The court established that under Section 25FFF of the Industrial Disputes Act, compensation is the exclusive remedy for termination due to closure of an undertaking.

ORDER :

(PER : HONOURABLE MR. JUSTICE A.S. SUPEHIA)

1. The present Letters Patent Appeal filed under Clause 15 of the Letters Patent, 1865, is directed against the judgment and order dated 13.09.2022 passed by the learned Single Judge in the captioned writ petition, wherein and whereby the respondent-Port has assailed the award dated 02.03.2019 passed by the Labour Court, Ahmedabad in Reference (T) No.383 of 2015. By the said award, the Labour Court has directed the respondent to reinstate the appellant-workman in service with 25% back-wages.

2. The learned Single Judge has altered the reinstatement with 25% back-wages to that of awarding an amount of Rs.7,00,000/- as compensation.

3. Learned advocate Mr.Jigar D. Dave, appearing for the appellant – workman has submitted that the appellant-workman may be ordered to be reinstated in service, instead of payment of compensation. He has alternatively submitted that an amount of Rs.7,00,000/- is too meagre and the same may be enhanced.

4. Learned advocate Mr.Jigar Dave, has further submitted that in fact, before the Labour Court, the respondent – Port was ready and willing to appoint the workman as an Operator on contractual basis at Chhatisgarh Port however, the Labour Court has finally thereafter directed reinstatement in service with 25% back-wages. Thus, it is submitted that the impugned judgment and order passed by the learned Single Judge may be set aside.

5. Learned advocate Mr.Dipak Dave, appearing for the respondents, while opposing the aforesaid submissions, has submitted that the judgment and order passed by the learned Single Judge may not be set aside, as the same is appropriately passed since the termination of the workman was due to the closer of unit at Belekeri Port in Karnataka and hence, the termination of the appellant would be in violation of Section 25FFF of the Industrial Disputes Act, 1947 (in short, the I.D. Act). It is submitted by the learned advocate Mr.Dave, that in fact, the appellant had worked for a period 7 years and hence, the amount awarded by the learned Single Judge on consensus shown by the respondent – Port of paying an amount of Rs.7,00,000/- is appropriate and the same may not be interfered with.

6. It is not in dispute that the appellant, who was working at Belekeri in Karnataka was terminated from service due to closer of their operation at that port. Thus, the termination is in violation of Section 25FFF of the I.D. Act. The learned Single Judge, after placing reliance on the judgment of the Supreme Court on the issue has finally, looking to the service of 7 years rendered by the appellant-workman, has awarded the compensation of Rs.7,00,000/-.

7. The learned Single Judge in the impugned judgment and order has held thus : -

“7.1 Section 25FFF of the Act particularly sub section (1) provides that where an undertaking is closed down for any reason, every workman who has been in continuous service for not less than one year in that undertaking is entitled to notice and compensation in accordance with the provisions of Section 25F of the Act as if the workman had been retrenched. There is between the text of Section 25F and Section 25FFF of the Act a significant difference in phraseology. Section 25FFF(1) of the Act merely imposes liability to give notice and to pay compensation on closure of the undertaking which results in termination of employment of the workman. Evidently, therefore, payment of compensation is the only relief that can be granted.

7.2 In the case of Hathising Manufacturing Company Ltd. (supra), the Apex Court appreciating the provisions of Section 25FFF has held as under:

“20. Does the impugned provision impose an unreasonable restriction because it imposes liability to pay compensation which is not related to the capacity of the employer ? Before the impugned section was enacted, the industrial tribunals undoubtedly decided the individual claims for compensation for termination of employment submitted to them on their merits and some