Case: Hindalco Inds. Ltd Vs. U O I

The appellant is a Public Limited Company having its registered office at Bombay, engaged, in the business of producing aluminium metal and its alloys and its factory is located at Renukoot in Uttar Pradesh Bauxite being a raw material required for the manufacture of aluminium, the appellant obtained various mining leases in Bihar under the provisions of the Mines & Minerals Regulations and Development Act, 1957. Appellant was thus having a bauxite mining lease which was known as Maidanpat Bauxite Mine. The mining operations at the Maidanpat Bauxite Mine were being done in forest land as well as non-forest land. On 24th July, 1993, the Divisional Forest Officer, Ranchi West Forest Division Bench, issued a letter to the appellant to stop the mining activities in the forest land of the Maidanpat Bauxite Mines. The appellant was asked to submit map and the records for decision to be taken in the matter. The appellant sent a reply stating that their lease was valid upto January, 1997 and that they may be permitted to continue mining operations. According to the appellant, the Divisional Forest Officer did not accede to its request and the mining operations were abruptly stopped and as there was no work for the workmen, a lay off was declared from 31st July, 1993. The appellant alleged that lay off compensation was paid to the workmen.2. The learned counsel for the appellant further contended that request was made to the forest authorities but no favourable response was received from them and the appellant had to close the mine w.e.f. 19th August, 1993 and this fact was intimated to the Divisional Forest Officer on 20th August, 1993. Thereafter, a notice of closure under Section 25-FFF of the Industrial Disputes Act, 1947 (hereinafter being referred as the I.D. Act) was sent to the concerned, authorities. The appellant further contended that though Section 25-O of the I.D. Act had no application, in abundant caution the appellant made an application to the Union of India for permission to effect closure. The application filed by the appellant was not entertained, as it was not filed within ninety days before the date of intended closure. The thereafter explained the position of closing of the mine on 19th August, 1993 for which the permission could not be obtained in advance. The first respondent after hearing the appellant as well as the representatives of the workman passed an order on 6th December, 1993. In that Order passed by the first respondent, the permission was granted subject to the followingThe closure would be as per provisions of Section 25-O of the Industrial Disputes Act, 1947;(ii) Compensation and notice salary would have to be paid to the workmen as per provisions contained under Section 25-O(8) of the Industrial Disputes Act, 1947;(iii) Whenever a fresh permission is granted to the Management for mining in the State of Bihar, the retrenched workmen would be employed as per the provisions contained in Section 25-H of the Industrial Disputespermission shall take effect from the date of issue of this letter.The appellant challenged the order of the first respondent dated 6th December, 1993 before the High Court by contending that Section 25-O of the I.D. Act had no application to the facts of the case as the closure of the work was not intended by the appellant but as a result of the direction given by the Divisional Forest Officer. According to the appellant, a voluntarily, planned and intended closure of an undertaking alone would attract Section 25-O of the I.D. Act and only under such circumstances, prior permission of at least ninety days before the date of intended closure is required to be obtained by the employer. The appellant had also contended before the High Court that the various conditions incorporated in the impugned order of the first appellant were not warranted. But all the pleas raised by the appellant were rejected by the Division Bench of the High Court and aggrieved by the same, the present appeal is filed.

Court's reasoning:
The appellant hadan establishment where more than 100 workmen were employed on an average per working day. This fact is not disputed by the appellant. In that event, the provisions contained in Chapter V-B of the I.D. Act would apply to the appellant. Section 25-O being the provision contained in Chapter V-B of the I.D. Act, they are the relevant provisions regarding the procedure for closing down of an undertaking. This clearly shows that Section 25-FFA and Section 25-FFF of Chapter V-A would not apply in respect of the closure of the mining operations of the appellant. The appellant admits that about 211 employees had been retrenched. Under sub-Section 8 of Section 25-O special provision has been made for the payment of compensation to workers when a permission for closure is granted.8. In view of the aforesaid circumstances, the plea of the appellant that Section 25-O of the I.D. Act applies to only planned and intended closure by the employer is devoid of merits and Section 25-O of the I.D. Act will govern the situation. We find no error of jurisdiction or illegality in the impugned judgment.