The provisions of Section 25-O of the Industrial Disputes Act are directory, allowing closure based on accumulated losses, and potential unemployment cannot prevent a company from closing a loss-making business.

JUDGMENT :

MILIND N. JADHAV, J.

1. Both these Writ Petitions are disposed of by the following common Judgment.

2. Writ Petition No. 7992 of 2023 is filed by the Petitioner-General Motors Employees Union (for short ‘the Union’ hereinafter) to challenge the order dated 28.04.2023 passed below Exhibit “U-25” in Reference (IT) No. 15 of 2021. This Application was filed during the pendency of Reference before the Industrial Tribunal.

3. General Motors India Private Limited is nomenclatured as ‘first party’ before the Tribunal in the Reference whereas the Union is nomenclatured as ‘second party’. They shall be referred to as “Company” and “Union” in this judgment for convenience. It was contended by the Union in the Application filed below Exhibit “U-25” that the Company has filed statutory Application for closing down of the Company under Section 25-O of the Industrial Disputes Act, 1947 (for short ‘the said Act’) on 20.11.2020, intending to close down the Company with effect from 20.04.2021. It is further stated that the Government after hearing both parties by order dated 18.01.2021, refused to grant permission to the Company for closure. The Company therefore preferred Review Application against the order dated 18.01.2021 and the appropriate Government on its request referred the matter under Section 25-O (5) of the said Act for adjudication to the learned Tribunal by order dated 19.03.2021.

4. The Union has submitted that the order of Reference dated 19.03.2021 was challenged in the Writ Petition No. 5139 of 2021 before this Court which came to be dismissed on 17.06.2022. This order of dismissal was reviewed before this Court vide Review Petition (St.) No. 17048 of 2022. However, in the meanwhile, the Company filed Special Leave Petition (Diary) No. 33610 of 2022 before the Supreme Court against the order of Reference dated 19.03.2021. The Supreme Court by order dated 13.12.2022 dismissed the Special Leave Petition. In the meanwhile, Review Petition (St.) No. 17048 of 2022 was also dismissed by this Court. Thereafter on 31.01.2023, the Company filed Special Leave Petition No. 4473 of 2023 before the Supreme Court to challenge the order dated 17.06.2022 passed by this Court dismissing Writ Petition No. 5139 of 2021. On 27.02.2023, the Supreme Court rejected Special Leave Petition No. 4473 of 2023.

5. It was contended by Union that as per Section 25-O(6) of the said Act, order of refusing to grant permission for closure has to remain in force for one year from the date of such order. It was further contended that if a Reference is made under Section 25-O(4) of the said Act to the Tribunal, then under sub-section 2 thereof, Award has to be passed within thirty days.

6. It is therefore contended that in the present case, Award is not passed within thirty days and further the order of Reference of the appropriate Government has a binding effect from the date of such order and if one year lapses then the Reference would become infructuous if undecided. Therefore, directions were sought for disposal of the Reference.

7. The Company opposed the Application on various grounds, inter-alia, stating that provisions under Section 25-O of the said Act requiring passing of the Award within a period of thirty days from the date of Reference, cannot be held to be mandatory and Reference validly made by the Government to the Tribunal cannot be rendered invalid if the Tribunal fails to pass the Award within thirty days for the circumstances beyond the control of the parties as well as the control of the Tribunal.

8. The learned Industrial Tribunal however by the impugned order dated 28.04.2023 rejected the Application. Both the learned Senior Advocates have referred to and relied upon several decisions of the Supreme Court and High Courts, including this Court. Five of those decisions are directly relevant and have been read ardently by both sides, na