Bombay High Court
Industrial Perfumes Ltd. vs Industrial Perfumes Workers Union on 23 April, 1998
Equivalent citations: [1998(79)FLR367], (1998)IILLJ1177BOM
Author: F.I. Rebello
Bench: F.I. Rebello
JUDGMENT F.I. Rebello, J.
1. Heard parties.
This petition is directed against the order dated January 29, 1998 whereby the Industrial Court at Mumbai in Complaint (ULP) No. 216 of 1997 has held the petitioner guilty of unfair labour practice under Item No. 9 of Schedule IV of the M.R.T.U. and P.U.L.P. Act. The Industrial Court has further directed the petitioner to desist from continuing the unfair labour practice with farther directions to pay wages to the employees concerned, under the terms and conditions of employment. The workmen have been directed to refund the balance amount from the amount received from the petitioner company after deducting upto date wages therefrom within a period of three weeks from the date of the order.
2. The Union of employees representing the workers has filed this complaint on the ground that the closure is not bonafide and in fact there was no closure. It was their further contention that the respondent Company had not closed down their business and was carrying on the business by shifting the work from one place to another. The complainant Union relied on the balance sheet of the petitioner Company as also various minutes of discussion that had taken place as well as the report of the Directors in support of their contention that the company was not closed. It was further contended that what the petitioner had done was merely shifting theproduction activities. This in fact could be seen from Exh. C-26 which is the draft copy of the minutes of the meeting held on December 7, 1995. One of the matters for discussion therein as set out was shifting of production. It was recorded asunder:-
"As regards shifting of production the Unit like Taloja, it was reported that management has done so because of its business exigencies."
3. At the hearing of the petition it is contended on behalf of the petitioner that the order of the Industrial Court is contrary to law in as much as the Industrial Court has not applied the correct test which have been set out in the judgment of the Apex Court. It is further pointed out that the petitioners could close down a part of the activities. Mere closure of the Unit or part of the activities would not result in the closure being not bonafide. It was further pointed out that merely because there u as a pending proceeding and that closure was effected without taking permission under Section 33(1)(a) of the I. D. Act by itself could not have given jurisdiction to the Industrial Court to pass the order. At any rate no relief could have been given in the case of closure. Reliance has been placed on the judgment of the Division Bench of this Court in the case of Shankarprasad s/o Gopalprasad Pathak v. Lokmat Newspapers Pvt. Ltd. Nagpur (1997-II-LLJ-195). In these circumstances it is pointed out that the judgment of the Industrial Court has to be set aside . The learned Counsel has relied on the judgments in the case of Banaras Ice Factory Ltd. v. Their Workmen, (1957-1- LU-253)(SC), in the case of Indian thane Pipe Company Ltd, and Their Workmen (1969-I-LLJ-242)(SC) in the case of Kalinga Tubes Ltd. v. Their Workmen (1969-I-LU-557)(SC) and in the case of The Workmen of Sur Iron and Steel Co., Pvt Ltd,, and another (1971-I-LLJ-570)(SC).
4. On behalf of the Respondent Union it is contended that the Industrial Court has given a finding that there is no closure. This is purely a finding of fact. In fact closure contemplates not merely closing down the place of business but the closure of the business itself. Reliance for that purpose has been placed on the judgment of the Apex Court in the case of Express Newspaper Ltd. v. Their Workers and Staff and others, (1962-II-LLJ- 227). It is further contended that during the pendency of a reference if there was violation of conditions of service, Section 33(1)(a) of the I.D. Act would be attracted and the Industrial Court was competent therefore to examine the matter and grant relief. Reliance is also placed on the judgment in the case of Dalanvalan Imarat Bandnkan and Patbandhare Kamgar Union v. The State of Maharashtra and Ors. (1993-III-LLJ-(Suppl)-744) (Bom), wherein a learned Single Judge has held that where there is breach of Section 33(1)(a) of the Industrial Disputes Act, it is only a short (sic) therefrom to come to the conclusion that there is an unfair labour practice within the meaning of Item 9 of Schedule IV of the Act, in view of the judgment of the Supreme Court in S. G. Chemical's case (1986-H-LLJ-490) (SC).
5. Having heard the parties I am of the considered view that there is no need to interfere with the impugned ordenit is true that the Apex Court in the case of Indian Hume Pipe Company Ltd. (supra) has observed that once the Tribunal finds that the employer has closed his factory as a matter of fact, it is not required to go into the question as to the motive which guided him and to come to a conclusion that because of the previous history of the dispute between the employer and the employees the closure was not justified. Such a closure cannot give rise to an industrial dispute. In Kalinga Tubes Ltd, (supra) again in the matter of closure the Apex Court has noted that the closure could arise due to various circumstances. In one case the management may decide to close down because of financial or purely business reasons. In another case it may decide in favour of closure when faced with a situation in which it considered either dangerous or hazardous from the point of view of safety of its administrative staff or members of the management or even the employees themselves to carry on the business and the essence of the matter is, therefore, factum of closure by whatever reason motived. In the case of the Workmen of Sur Iron and Steel Co. Pvt. Ltd. (supra) the Apex Court recorded a finding that merely because the company was buying manufactured articles from other factories and stamped them with their own trade mark, by itself, would not make the closure, no closure in the eyes of law. In Banaras Ice Factory Ltd. (supra) the Apex Court was pleased to observe that if there is no real: closure but a mere pretence of a closure or it is mala fide, there is no closure in the eyes of law and the workmen can raise an industrial dispute and may even complain under Section 23 of the Act. It is further observed that in case of termination of employment on account of closure then provisions of Section 22 of the Industrial Disputes (Appellate Tribunal) Act which is similar to Section 33(1)(c) would not apply. It is contended by Mr. Rele on behalf of the petitioners that in the instant case after considering the various reports it was found that the work site was not safe for carrying on manufacturing activities and it was environmentally hazardous and in these circumstances the company was compelled to close down its activities there.
6. The fact on record disclose that the petitioner is now a subsidiary of Hindustan Lever Limited. It became a subsidiary some time in December 1994. Thereafter various Schemes of VRS were floated. First 156 workers accepted the VRS. In November 1995 a further 63 workers accepted VRS and thereafter another 53 workers accepted VRS, leaving behind about 40 workers. It was contended that it was not possible to carry on production with those 40 workers. These 40 workers raised a dispute and the same was referred to the Industrial Tribunal on January?, 1997. The reference was as under:-
"That all the workers be given work with immediate effect in the factory of M/s Industrial Perfumes Ltd., at Hay Bunder Road, Sewri, Mumbai- 400 033.
It is pointed out that after this reference the closure was effected on April 10,1997. It is under these circumstances that the complaint came to be filed by the Union complaining of unfair labour practice under Item No.9 of Schedule IV on the ground that violation of Section 33(1)(a) would amount to unfair labour practice.
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 December 31, 1996 the company is shown to have made a profit before tax of Rs. 250.77 lakhs compared to Rs. 114.11 lakhs during the previous year ending December 31, 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 Road has been closed down the business of the company has not been closed down and manufacture or both items in respect of which the company holds licence are being carried on either at the plant of Hindustan Lever Limited of which it is a subsidiary at Taloja or through the General Per-fumes. 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.
7. The further argument on behalf of the petitioners is that this could not have been gone into in a complaint under Item 9 of Schedule IV of the MRTU & PULP Act. According to the teamed Counsel merely because there was a violation of Section 33(1)(a) that would not amount to an unfair labour practice in the case of closure as has been held in the case of Banaras Ice Factory Ltd, (supra). Further in such an event in the like manner Section 33(1)(a) has been interpreted for the purpose of I.D.Act namely that the dispute can be decided under Section 33-A, the Industrial Court was bound to consider the merits of the matter itself. Counsel relies on the judgment of the Division Bench Shankarprasad s/o Gopolprasad Pathak (supra). It may immediately be noted that the judgment of the single Judge of this Court in the case of Dalanvalan Imarat Bandhkam and Patband-here Kamgar Union (supra) was not considered by the Division Bench while passing the judgment in Shankar Prasad s/o Gopal Prasad Pathak (supra). Even otherwise what was in issue in that case was the matter of transfer. It is true that the Division Bench did consider the: question of contravention of Section 33 of the Industrial Disputes Act. In that case proceedings were at the stage of conciliation. The Division Bench noted that before amendment to the ID Act and also after amendment and observed that the Conciliation Officer can take into account such complaint in mediating in, and promoting the settlement of, such industrial dispute and that the remedy under Section 33-A as it then stood and under Section 33-A(b) as it now stands is not available if the employer contravenes the provisions of Section 33 while conciliation proceedings was pending before the Conciliation Officer or Board. Thereafter the Division Bench noted that when proceedings is pending before those authorities and complaint of breach of provisions of Section 33 is made under Section 33-A old or 33-A(b) new, the complaint under Section 28 of MRTTJ and PULP Act will not arise in view of the provisions of the Section 59 of MRTU and PULP Act. Then the Division Bench noted that Item I of Schedule IV of MRTU and PULP Act would be attracted. The Division Bench thereafter noted that while considering as to whether actual order of discharge or dismissal suiters from unfair labour practice the Labour Court will also consider the breach of contravention of Section 33 of I.D. Act along with main contention rendering the said order of discharge and dismissal being of unfair labour practice under Item I of Schedule IV of MRTU and PULP Act. In my view the judgment of Shankar Prasad s/o G.Pathak (supra) does not in any manner say that the complaint would not be maintainable if there is a contravention of the provisions of Section 33 of I.D. Act. After the judgment in S. G. Chemicals case (supra) as has been held by the single Judge of this Court in Dalan Vatan Imarat Bhandkham (supra) breach of Section 33 would invite Item 9 of Schedule IV of the MRTU and PULP Act.
8. In the instant case we may note that the Industrial Court has dealt with the issue that the closure was effected on account of safety, environmental and other reasons. True, even if the Court should not go into the sufficiency or adequacy of the material the Court can still consider whether in fact the closure is real or genuine and whether in fact there is closure at law. The Industrial Court in para. 24 has dealt with the contentions of the employer that closure was effected because of safety, health and environment. The Directors annual report for the year December 31, 1996 was considered wherein it was set out that the company had made arrangement to source the material on contract basis and operations have now started. Therefore, there is only a closure of the establishment, but there is no closure of business. As laid Down by the Apex Court in Express Newspapers Limited (supra) this is not a closure at law. I am, also, unable to accept the contentions on behalf of the employer that the closure being real the Court cannot go into the reasons for the closure. Courts today can lift the veil to see what lies behind it. It is no longer a secret room which cannot be entered into. On lifting the complete veil the unmistakable conclusion is that the company in the instant case has only closed down the manufacturing unit without closing its business which is being carried on. This cannot be said to be closing down of a pan of the establishment/factory. In fact the profits are on the increase. The work is being done in the plant at Taloja belonging of Hindustan Lever Ltd., of which the petitioner company is a subsidiary and in contract with another.
9. This is yet another typical case where the company continues its business by shifting production elsewhere. It is in that context that time has come when the Court will have to examine whether the right to work forms an integral part of Article 21 of the Constitution. In the instant case we have found that one group of workers are being sent home whilst another group of workers are allowed to do the same work under a different label. When it comes to interpretation of the Articles constituting part of Chapter IV of the Constitution, rules of interpretation tend to become blunt edged. One may pose the question as to whether any of the directive principles have precedence over the other, if at all the right to work must stand amongst the tallest. In our myopic vision we have forgotten this right while claiming that there are certain other principles in the Chapter on Directive Principles which are to be enforced. The people of this country are its soul. If the soul itself is starved to death what remains of the country. Fifty years is a long time to tell the men and women of this country', that there are no jobs nor can the State provide them their minimum food requirement in the from of public assistance. If by judicial interpretation protection of environment, right to, clean air, pure water, protection of culture are facts of the right to life, and if Courts can lament on the non-enforcement of some of the Directive Principles, what about the right to work and/ or the right to public assistance as enshrined in Article 39 and 41 of the Constitution of India. After fifty years of independence are they to remain only on paper. Some day soon the Courts will have to address themselves to this question.
10. Having said this, I find that there is no merit in this petition, which is accordingly rejected.