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1981 Supreme(AP) 50
Andhra Pradesh High Court
Judges : P.A.CHOUDHARY
T.GATTAIAH - Appellant
Versus
COMMISSIONER OF LABOUR HYDERABAD - Respondent
Decided On : 03-02-81
A writ of mandamus can issue against a private company to compel it to carry out directions of the Parliamentary enactment contained in Chapter V-B of the Industrial Disputes Act.
Headnote:
INDUSTRIAL DISPUTES ACT - LAY-OFF AND RETRENCHMENT - WRIT OF MANDAMUS - JURISDICTION OF HIGH COURT - PUBLIC DUTY - ARTICLE 226 OF THE CONSTITUTION.
Fact of the Case:
87 workmen of IDL Chemicals Limited, Hyderabad (hereinafter referred to as the Company) filed a writ petition under Article 226 of the Constitution complaining against their lay-off and retrenchment by the said company. The Company admitted the facts relating to lay-off and retrenchment and feebly attempting to justify the same raised an important question relating to the competence of the High Court to issue a Writ in the nature of Mandamus or any other appropriate Writ or direction directing the Commissioner of Labour, the first respondent herein to hold that their lay-off and retrenchment were in violation of the statutory provisions and are therefore null and void and to direct the laid Company to continue them in service with back wages.
Finding of the Court:
The High Court held that the lay-off of the petitioners on 8-2-1980 would be unjustifiable, unless it is justifiable on the ground of shortage of power. The High Court also held that the retrenchment of the petitioners by the Company with effect from 10th April 1980 was in terms of the Statute Section 25-N of chapter V-B of the Industrial Disputes Act dealing with retrenchment does not admit any exceptions of circumstances Unless the retrenchment was brought about in accordance with Section 25-M of the Industrial Disputes act, the retrenchment should be held to be null and void. The High Court further held that the respondent-Company is under a public duty to observe the conditions mentioned in Chapter V-B of the Industrial Disputes Act and a writ of mandamus is competent to issue to the respondent-Company.
Issues: 1. Whether the High Court has jurisdiction to issue a Writ of Mandamus against a private company under Article 226 of the Constitution? 2. Whether the lay-off and retrenchment of the petitioners by the Company were legally authorised or not?
Ratio Decidendi: 1. The High Court held that the word "person" occurring in Article 226 of the Constitution would include an incorporated body. Prima facie, therefore, a private person or an incorpated company cannot be taken out of the swetp and the contemplation of Article 226. The High Court further held that the restrictive meaning suggested to be given to the word "person" occurring in Article 226 would render that word a surplusage because according to that interpretation the word "person" can only mean another governmental authority. The rule of interpertation that the meaning of a word should be ascertained from the association it keeps, cannot therefore, be applied to the word "person" occurring in Article 226 of the constitution. 2. The High Court held that the lay-off of the petitioners on 8-2-1980 would be unjustifiable, unless it is justifiable on the ground of shortage of power. The High Court also held that the retrenchment of the petitioners by the Company with effect from 10th April 1980 was in terms of the Statute Section 25-N of chapter V-B of the Industrial Disputes Act dealing with retrenchment does not admit any exceptions of circumstances Unless the retrenchment was brought about in accordance with Section 25-M of the Industrial Disputes act, the retrenchment should be held to be null and void.
Final Decision: The High Court allowed the writ petition and issued a writ of mandamus to the respondent-Company not to retrench the p:titioners except in accordance with the conditions laid down by the Parliament.
( 1 ) THIS is an application under Article 226 of the Constitution filed by eighty seven workmen of IDL Chemicals Limited, Hyderabad (hereinafter referred to as the Company) complaining against their lay-off and retrenchment by the said company. These petitioners had been laid off on 8-2-1980 and they were later retrenched on 7-4-1980. The petitioners claim that their lay-off as well as retrenchment was brought about by the said Company contrary to the mandatory provisions of the Industrial Disputes Act, 1947 as amended by the Industrial Disputes (Amendment) Act, 1976 (Act No. XXXII of 1976 ). It is on that basis, that they pray this Court should issue a Writ in the nature of Mandamus or any other appropriate Writ or direction directing the Commissioner of Labour, the first respondent herein to hold that their lay-off and retrenchment were in violation of the statutory provisions and are therefore null and void and to direct the laid Company to continue them in service with back wages.
( 2 ) THE Commissioner of Labour, Hyderabad, although served with rule Nisi of this Court, entered no appearance and filed no counter. He virtually remained ex parte. The Company, the second respondent, had filed a counter and contested this application. The Company while admitting the facts relating to lay-off and retrenchment and feebly attempting to justify the same raised an important question relating to the competence of this Court to issue a Writ to the aforesaid Company under Article 226 of the Constitution. The Company s contention is that it was merely an association of private individuals incorporated under the Companies Act like many other companies and that its activities were purely private in nature without there ever being any control exercised by it over others or its activities being shared or participated in by th 5 State or Central Governments. The Company pleaded that it had no public duties to perform or responsibilities to discharge and that therefore it is not a proper person to be reached under Article 226 of the Constitution. In paragraph 3 of its counter, the Company said:"it is well settled that no writ can lie against a company merely incorporated under the Indian Companies Act and the second respondent is one such. It is not attracted to "other authorities" within the ambit of Article 12 of the Constitution and falls entirely outside the purview of the connotation of a state. The second respondent is not a corporation established by a statute and muchless, an instrumentality or agency of the state. The activities of the second respondent are purely private activities. No control over its functions is exercised by the State and the functions carried by the second respondent are not public functions. The second respondent is neither a statutory company nor one having public duties or responsibilities imposed on it by a statute. It is, therefore, submitted that no question of a writ of any kind, whether of Mandamus or otherwise, being issued against the second respondent Company would arise. "
( 3 ) ON merits, the Company justifies the lay-off on the ground of 30 percent power-cut imposed by the A P. State Electrictiy Board on the supply of electricity to all industries, with effect from 4th September, 1979 and also on the ground of non-availability of high speed diesel oil. According to the company as the lay-off was due to power cut and non-availability of diesel oil, no question of obtaining previous permission of the State authorities as provided under the Industrial Disputes Act could arise.
( 4 ) REGARDING retrenchment the case of the Company was that after the expiry of 45 days from the date of lay-off, the 87 workmen could be retrenched by the Company in pursuance of the second proviso to Section 25 C of the Industrial Disputes Act after giving them one month s notices as required under clause (a) of Section 25-F or after paying them the compensation due to them under that section and as that
