General Labour Union (Red Flag) Bombay vs B. V. Chavan

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

1984 Supreme(SC) 332

SUPREME COURT OF INDIA
D.A. DESAI, V. BALAKRISHNA ERADI AND V. KHALID,JJ.
General Labour Union (Red Flag), Bombay, Appellant
Versus
B.V. Chavan and others, Respondents.
Civil Appeals Nos.6092 and 6093 of 1983, D/-16-11-1984.
Versus
Mr. M.K. Ramamurthi, Sr. Advocate, Mrs. Urmila Sirur, Advocate with him, for Appellant; Mr. Gobind Das, Sr. Advocate, Mr. P. H. Parekh and Ms. Indu Malhotra, Advocates with him, for Respondents.

Advocates:
GOBIND DAS, Indu Malhotra, M.K.RAMAMURTHY, P.H.Parekh, URMILA SIRUR

Headnote:
Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 - Section 28 - Industrial Disputes Act, 1947 - Section 2(1), 22(2), 23, 26 - Constitution of India, 1950 – Article 226 - Guilty of Imposing and Continuing Lock-Out - Unfair Labour Practice - General Labour Union Bombay filed two complaints, one against M/s Delta Wires Pvt. Ltd. and second against M/s Delta Spokes Manufacturing Company - Broadly stated complaints were that employers were guilty of imposing and continuing a lock-out and had thus committed unfair labour practice - Employers contended that they had finally and irrevocably closed industrial undertaking and were not guilty of any unfair labour practice - Whether employers had committed an unfair labour practice by imposing and continuing a lock-out as provided in Item 6 of Schedule II of the Act - Whether employers have imposed a lockout or have closed establishment it is necessary to find out what was intention of employer at time when it resorts to lockout or claims to have closed down industrial undertaking - Whether employer, had imposed a lock-out or had closed down business - Whether closure is brought about mala fide and whether it could have been avoided are matters irrelevant and what is to be ken is whether in fact and in effect there is a closure or not – Held, Change of circumstances may encourage an employer to revive industrial activity which was really intended to be closed - Therefore true test is that when it is claimed that employer has resorted to closure of industrial activity, industrial court in order to determine whether employer is guilty of unfair labour practice must ascertain on evidence produced before it whether closure was a device or pretence to terminate services of workmen or whether it is bona fide and for reasons beyond control of employer - Duration of closure may be a significant fact to determine intention and bona fides of employer at time of closure but is not decisive of matter - To accept view taken by Industrial Court would lead to a startling result in that if an employer who has resorted to closure, bona fide wants to reopen, revive and re-start the industrial activity he cannot do so on the pain that the closure would be adjudged a device or pretence - Therefore correct approach ought to be that when it is claimed that employer is not guilty of imposing a lockout but has closed industrial activity, Industrial Court before which, action of employer is questioned must keeping in view all relevant circumstances at time of closure decide and determine whether closure was a bona fide one or was a device or a pretence to determine services of workmen - Answer to this question would permit Industrial Court to come to conclusion one way or other – Appeal Disposed of.

Judgment

DESAI, J.:- General Labour Union (Red Flag) Bombay filed two complaints, one against M/s Delta Wires Pvt. Ltd. and second against M/s Delta Spokes Manufacturing Company, two sister concerns (employers for short) under Sec. 28 read with Items 1(a), 1(b), 2, 4(a), 4(f) and 6 of Schedule II of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 (Act for short). Broadly stated the complaints were that the employers were guilty of imposing and continuing a lock-out and had thus committed unfair labour practice. The employers contended that they had finally and irrevocably closed the industrial undertaking and were not guilty of any unfair labour practice. The complaints were filed in the Industrial Court, Maharashtra, Bombay.

2. The learned Judge framed an issue whether the employers had committed an unfair labour practice by imposing and continuing a lock-out as provided in Item 6 of Schedule II of the Act.

3. After hearing the parties, the learned Judge answered the issue in negative and dismissed the complaints.

4. The appellant-Union filed two special civil applications in Bombay High Court under Art. 226 of the Constitution questioning the correctness of the decision of the Industrial Court. Both the applications were dismissed in limine. The Union thereupon filed these two appeals by special leave.

5. At the hearing of the appeals, Mr. Govind Dass, learned counsel for the employers stated that the employers have reopened the industrial units and there is partial resumption of manufacturing process. He further stated that the emoloyers are willing to take back all the old workmen and in order to satisfy the court about the bona fides of the employers he pointed out that nearly 16 old workmen, who responded to the advertisement in a local newspaper, have already been re-employed will put on record an unconditional undertaking as afffidavit in these appeals that no new workman will be recruited in afore-mentioned two industrial undertakings who had not been in previous employment with them without giving first preferece to the workmen who were in employment of the two concerns on April 8, 1980 when they were closed down. Mr. M. K. Ramamurthy learned counsel for the appellant union, on the other hand, contended that the industrial undertakings of the employers had never been closed or at any rate have resumed working in full and that the old workmen are not being employed and new hands are being recruited.

6. We record the unequivocal undertaking given on behalf of the employers by the learned counsel Shri Govind Dass. that all the old. workmen who were in service of the employers at the time of the alleged closure, that is up to and inclusive of April 8, 1980, will be re-inducted in service as resumption of work is gradually expanding and that till all the old workmen are re-inducted in service no, new hand will be recruited. An undertaking to that effect by Dr. P. D. Meghani s/o Dharam Chand Meghani has been placed on. record and is treated as an integral part of this judgment. In order to be assured that the undertaking is carried out in letter and spirit we direct the Industrial Court Maharashtra Bombay to depute its senior ministerial officer to visit the industrial undertakings of the employers and to satisfy itself that the old workmen are being re-inducted in service and that as resumption of production is gradually expanded, the old workmen will be re-inducted in service. There will be a continuous watch by the ministerial officer to be appointed by the Industrial Court till all the old workmen. who are willing to be re-inducted in service are taken back in service.

7. In fact this undertaking should have concluded the matter. But there is a statement of law made by the Industrial Court while rejecting the complaints filed by the appellant union which does not commend to us and to avoid any such error being repeated in future, we, with a view to set right the matter proceed t

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