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2007 Supreme(Bom) 513
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
DR. S.RADHAKRISHNAN & SMT.V.K. TAHILRAMANI, JJ.
Biddle Sawyer Ltd.— Petitioner
V.
Chemical Employees Union — Respondents
WRIT PETITION NO.427 OF 2006
Decided on : 11th April, 2007
Advocates appeared :
Mr. P.K. Rele, Senior Advocate with Mr. Nutan Patankar,
Mr. R.P. Rele and Mr. Piyush Shah for the Petitioner.
Mr. J.P. Cama, Senior Advocate with Mr. Arshad Shaikh i/by
M/s. Sanjay Udeshi & Co. for the Respondents.
Mr. K.K. Singhvi, Senior Advocate with Mr. Sanjay Singhvi,
Bennet D’Souza and Mr. K.S. Bapat for the Intervenor.
Headnote:Industrial Disputes Act, 1947, Section 2 (cc)-Industrial dispute--"Closure" and "Place of employment"-Meaning and extent of meaning--"Closure" means permanent closure of the "place of employment" or a part thereof and could never mean only "Place" of employment--Closure of "place of employment" means closure of undertaking or establishment wherein employees are provided employment in the sence business is closed and not mere place of employment.
Closure is the closing down permanently of the source of employment of the workmen, i.e. the place where the employment is actively generated. It thus follows that closing down of a “place” of business would not amount to closure as that would be over simplification which would lead to various negative ramifications as they have been extensively dealt with in the earlier part of the judgment in various quotations from various judgments. Labour legislation is a social welfare legislation. It is an umbrella of protection provided to workmen to shield them from the employer exploiting their vulnerable position. But it cannot be said that merely because a place of manufacture has been closed down and restarted at another place or transferred to another employer that the undertaking has been closed down. The business itself is still alive, the source of employment is still present and there is no valid closure in law.
“Closure” would really mean permanent closure of the “place of employment” or a part thereof and the same could never mean only “place” of employment. One has to read the above definition of Section 2 (cc) of Industrial Disputes Act in a comprehensive manner and not in a disjointed manner. A “place of employment” means a place which generates employment or where business is carried on, and the same should not be construed in a superficial manner to indicate only a building or factory.
A place can never be permanently closed if it has no relationship with the business or industry. Therefore, if the business is not closed, then one cannot permanently close a “place” of business. Similarly closure of a place of employment i.e. any one of the establishment will have no meaning unless the industry or establishment is closed and the employment comes to an end. This is because without closing the business closure of a “place” in which business is carried on cannot be permanently closed, as some other business will start in that place. Therefore closure of a “place of employment” would mean closure of the undertaking or the establishment wherein employees are provided employment in the sense business is closed and not merely the place where business is carried on.(Paras 38 to 41)
1. The present petition had been referred to us by the Hon’ble the Chief Justice with regard to a dispute about the interpretation of Section 2 (cc) of Industrial Disputes Act, 1947. The dispute arises from conflicting judgments of this Court. The learned Senior Counsel appearing for the Petitioners has brought to our notice the judgment of a Learned Single Judge in the case of Voltas Employees Union, Mumbai V/s. Voltas Limited, Bombay & Another - (2003) 1 CLR 205. The relevant paragraph of the said judgment reads as under:-
"The definition of "closure" has been included in the I.D. Act by an amendment of 1982. This amendment is in terms different from the meaning attributed by the Apex Court to the word "closure" in the Express Newspapers. There the Apex Court has held that closure meant not only closing down place of business but the business itself and that indicated the final and irrevocable termination of the business itself. Closure as defined under the I.D. act means closure of a place of employment or part thereof permanently. Now, the first submission of the learned Counsel for the Union that the CABD is part of the Thane establishment and, therefore, cannot be closed down on its own since the Thane works are to be considered as a single legal entity cannot be accepted as the definition of "closure" permits the closing down of part of the place of employment. Assuming the CABD is part of the Thane works, the closing down of that part is permitted by the I.D. Act. Significantly, this definition does not speak of closure of the business as the Apex Court has had in the Express News papers case (supra). Therefore, the CABD is not a closure in the eyes of law as the business itself has been shifted to Dadra is of no avail."
2. On the other hand, the learned Senior Counsel appearing for the Respondents has brought to our attention the judgment in the case of Industrial Perfumes Limited V/s. Industrial Perfume Workers Union - 1998 (II) CLR 273, particularly the following portion:-
"It may be noted that the Petitioners main business was processing and making of general perfumes. In so far as aroma chemicals are concerned, since September 1995 the production had been shifted to the plant of Hindustan Lever Ltd at Taloja and in so far as perfumes are concerned the work is being done by General Perfumes since early 1996. The licence continued in the name of the Petitioners. In fact the balance sheet of the company would show that there has been increase in profits. Apart from that in the year ending 31st December, 1996 the company is shown to have made a profit before tax of Rs.25077 lakhs compared to Rs.11411 lakhs during the previous year ending 31st December, 1995. Further an amount of Rs.330 lakhs were made for restructuring of manufacturing operation in the year 1996. What this indicates as held by the Industrial Court is that though the plant at Hay Bunder has been closed down the business of the company has not been closed down and manufacture of both items in respect of which the company holds licence are being carried on either at the Plant of Hindustan Lever Ltd of which it is a subsidiary at Taloja or through the General Perfumes. In other words it is clear that there is no closure of business which is one of the tests to be satisfied as laid down by the Apex Court in the case of Express Newspapers Ltd.(supra). Apart from Hay Bunder the petitioner had no other manufacturing unit."
3. The learned Senior Counel has also brought to our notice the judgment in the case of Vazir Glass Works V/s. Bharat R. Tayade and Others - 2000 II CLR 640, of which the relevant paragraph reads as under:-
"Bearing in mind these findings recorded in the earlier judgment and their present guarantee given and the stand by the complainant herein that the petitioners and Respondent No.2 have functional integrity to my mind the issue of Relationship between the Petitioner and Respondent No.2 will have to be
