Back
IN THE HIGH COURT OF ALLAHABAD
S. R. Singh, J.
PRAG VANASPATI PRODUCTS - Appellant
Versus
STATE OF U.P - Respondents
C. M. W. P 21615 Of 1982
Decided On : 11/11/1992
INDUSTRIAL DISPUTES ACT, 1947 - SECTION 3(A) - LOCK-OUT - PROHIBITION - VALIDITY - CONDITIONS PRECEDENT - OPINION FORMATION - FAIR PROCEDURE - AUDI ALTERAM PARTEM - NATURAL JUSTICE - POST DECISIONAL HEARING - SCOPE OF JUDICIAL REVIEW - GOVERNMENT'S POWER UNDER SECTION 3 - NATURE AND EXTENT - LEGISLATIVE, ADMINISTRATIVE, AND QUASI-JUDICIAL FUNCTIONS - DISTINCTION - U. P. INDUSTRIAL DISPUTES ACT, 1947 - SECTION 3(A) - PROVISION FOR PROHIBITING LOCK-OUT - MEANING AND SCOPE - FINANCIAL ASSISTANCE AND SECURITY TO FACTORY - NECESSITY.
Fact of the Case:
The petitioner, a registered firm engaged in the manufacture of vanaspati, faced labor unrest and financial difficulties. The workers allegedly engaged in slow-go tactics, causing damage to the factory property. The petitioner declared a lock-out to protect its property and employees. Despite a settlement agreement, the workers continued to harass the petitioner, leading to an extension of the lock-out. The State Government, acting under Section 3(a) of the U. P. Industrial Disputes Act, 1947, issued a notification prohibiting the lock-out for 180 days to maintain public order and employment.
Finding of the Court:
1. The State Government's power under Section 3(a) of the Act to prohibit lock-outs is not limited to proposed lock-outs but also extends to lock-outs already declared. 2. The expression "the State Government may make provision for prohibiting lock-outs" in Section 3(a) includes making provisions beyond merely issuing an order prohibiting lock-outs. 3. The State Government's opinion that it is necessary or expedient to prohibit a lock-out must be based on valid material and formed in a fair and reasonable manner. 4. The audi alteram partem rule is impliedly excluded from the purview of Section 3 of the Act, but the State Government must act fairly, without arbitrariness or mala fide, and in accordance with the principles of natural justice. 5. Post-decisional hearing may be sufficient to satisfy the audi alteram partem requirement in the context of Section 3 of the Act. 6. The State Government's order prohibiting the lock-out was invalid because it did not make any provision beyond issuing the order and failed to address the underlying financial and security concerns of the petitioner.
Issues: 1. Whether the State Government can prohibit a lock-out under Section 3(a) of the Act after it has already been declared. 2. Whether the State Government is required to observe the audi alteram partem rule before issuing an order under Section 3(a) of the Act. 3. Whether the State Government's opinion that it is necessary or expedient to prohibit a lock-out must be based on valid material and formed in a fair and reasonable manner. 4. Whether the expression "the State Government may make provision for prohibiting lock-outs" in Section 3(a) includes making provisions beyond merely issuing an order prohibiting lock-outs. 5. Whether the State Government's order prohibiting the lock-out was valid and effective.
Ratio Decidendi: 1. The State Government's power under Section 3(a) of the Act to prohibit lock-outs is not limited to proposed lock-outs but also extends to lock-outs already declared. 2. The audi alteram partem rule is impliedly excluded from the purview of Section 3 of the Act, but the State Government must act fairly, without arbitrariness or mala fide, and in accordance with the principles of natural justice. 3. The State Government's opinion that it is necessary or expedient to prohibit a lock-out must be based on valid material and formed in a fair and reasonable manner. 4. The expression "the State Government may make provision for prohibiting lock-outs" in Section 3(a) includes making provisions beyond merely issuing an order prohibiting lock-outs. 5. The State Government's order prohibiting the lock-out was invalid because it did not make any provision beyond issuing the order and failed to address the underlying financial and security concerns of the petitioner.
Final Decision: The petition was allowed, and the impugned orders dated June 16, 1992, and August 1, 1992, were held invalid, inoperative, and ineffective. The State Government was directed to make fresh orders in accordance with the law and the observations made in the judgment.
( 1 ) THE writ petition is directed against the Notification dated June 16, 1992 issued by the State government under Section 3 (a) of the U. P. Industrial Disputes Act, 1947 (herein after referred to as the Act) published in Extra Ordinary Official Gazette Uttar Pradesh under Section 19 of the said Act on the same date. The State Government in purported exercise of its power under section 3 (a) of the Act has prohibited lock-out in M/s. Prag Vanaspati Product for a period of 180 days w. e. f. the date of publication of the Notification in the Official Gazette. The notification being relevant for the purposes of discussing the controversy involved the case is quoted below:
( 2 ) M/s. Prag Varnaspati Product, the petitioner is a registered firm engaged in manufacture of vanaspati. It is an Industry within the meaning of the term defined in Section 2 (k) of the Act. The production in the petitioner-factory was, it is alleged, quite smooth and normal upto 1990 but in the month of January, 1991, the workers of the factory are said to have adopted go slow tactice and subsequently they are said to have indulged in further activities of lawlessness and of causing damage to the factory property as a result whereof, it is alleged, the petitioner was compelled to suspend the production in the factory in the month of February, 1991, though the payment of salary to the workers was not stopped and in order to discharge its liability to pay the salary to its workers continuously the petitioner took job work from the National Dairy development Board, Noida which according to the petitioner was not liked by the workers and their union and therefore, they deliberately commuted mischeifs by their action and in actions so as to delay the completion of job work undertaken by the petitioner from the national Dairy development Board, Noida. In the circumstances stated herein before and as a result of acts of commission and omission amounting to mischief and negligence on the part of the workers, the petitioner had to pay about Rs. 3,00,000/- (three lacs only) as damages to the National Dairy development Board. It is alleged that on the one hand workmen made it impossible for the petitioner to run the factory and on the other they were not allowing by their illegal and unlawful activities, the finished stock to be moved out of the factory. The petitioner had to write a letter to the secretary, Vanaspati Workers Union on November 20, 1991 stating therein that in that the members of the Union were indulging in anti-social and unlawful activities and they were not permitting the petitioner to have access to the record of the factory nor were they permitting the petitioners executives and officials to load, unload, shift and remove the raw materials, chemicals and their products lying in the factory premises resulting in great monetary loss to the petitioner. It is also alleged that illegal and unlawful activities and unruly behaviour of the workers continued despite informations to the District Administration, namely, the District magistrate and the police authorities and, therefore, it is alleged, the petitioner was compelled to issue notice to the workmen informing them that the petitioner proposed to declare lock-out w. e. f. November 30, 1991 in various Departments of the factory specified in the notice dated november 9, 1991.
( 3 ) DESPITE notice to declare lock-out the situation did not improve and workmen, it is alleged continued to harass the petitioner in every possible manner due to which the petitioner had to declare lock-out in the factory premises w. e. f. November 30, 1991 at 8 a. m. It is also alleged that despite declaration of lockout the situation did not improve and the District Administration viz. the District Magistrate and the Senior Superintendent of Police, Aligarh failed to provide requisite, protection despite request.
( 4 ) IT is also alleged in the writ petition that in the wake of ever increasing incidents of
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
