Sections 25N and 25Q of the Industrial Disputes Act are unconstitutional and invalid for violating Article 19(1)(g) of the Constitution as they impose unreasonable restrictions on the right to carry on business.

Ramanujam, J.

1. The petitioner is a director of Sri Ganapathy Mills Co. Ltd., Tirunelveli, hereinafter referred to as the company and he seeks a writ of mandamus directing the first respondent herein to forbear from taking any further action under S. 25Q for violation of S. 25N of the Industrial Disputes Act, hereinafter referred to as the Act on the ground that Ss. 25N and 25Q are unconstitutional.

2. The company is a spinning mill employing more than 300 workmen. In or about the beginning of 1977 it found the posts of two clerks, one store assistant and one office boy to be superflous to its needs and as a measure of economy it decided to abolish those posts. By a notice dated 16-1-77, the company retrenched respondents 2 to 5 holding the posts occupied by them to be surplus in accordance with S. 25F of the Act. Each of them was given one month's pay in lieu of notice and retrenchment compensation as per S. 25F. Further, by a notice in Form R dated 16-1-77 the company informed the Government of Tamil Nadu about the retrenchment of the four employees with effect from 17-1-1977 for the reasons set out in the said notice.

3. The Deputy Commissioner of Labour, the first respondent herein, however, issued a show-cause notice dated 16-4-1977 calling upon the petitioner and the other Directors of the company to show cause why prosecution should not be launched against each of them under S. 25Q of the Act for non-compliance with S. 25N(i) of the Act as amended by the Amending Act of 1976. Apprehending that prosecution may be launched against him, the petitioner has come forward with this writ petition challenging the constitutional validity of S. 25N and S. 25Q of the Act.

4. According to the petitioner, S. 25N is violative of Art. 19(1)(g) of the Constitution as the provisions of the said section are unreasonable as well as onerous and cannot, therefore, be treated as reasonable restrictions saved by clause (6). It is also his case that S. 25N in so far as it provides for a prior permission before effecting retrenchment affects the autonomy and discretion of the employer in matters which are legitimately and solely within its province and as such it is an unreasonable restriction on the right of the employer to carry on his business and that in any event, S. 25N in so far as it does not lay down any guidelines to control the discretion of the Government in granting or refusing permission for retrenchment, the power should be taken to be arbitrary and violative of Art. 14 of the Constitution. It is also submitted that in so far as S. 25N applies only to employers employing more than 300 persons and not to all employers, it is discriminatory in that an employer employing less than 300 persons will have an absolute discretion to retrench his surplus labour while the employers employing more than 300 persons will have no such discretion and the discretion in such cases is left to the Government and this classification of employees into two categories has no nexus at all to the objects sought to be achieved and, therefore, S. 25N introducing such a classification is discriminatory and as such violative of Art. 14 of the Constitution.

5. In the counter-affidavit filed by the Union of India, the 6th respondent herein it is stated that there is nothing unconstitutional or illegal in S. 25N or 25Q of the Act, that S. 25N does not prohibit an employer from retrenching his workmen but before doing so, he must satisfy the specified authority about the reasonableness of the proposed action, that the Act being a social welfare legislation the Government is entitled to cheek up unreasonable and indiscriminate actions of the employers in the interest of the working class, that Chapter VB of the Act was inserted by the Amending Act of 1976 with a view to check the incidence of lay-off, retrenchment and closure in larger industrial establishments to avoid labour unrest resulting from indiscriminate action on the part of the employers and that there