HINDALCO INDUSTRIES LTD. versus UNION OF INDIA AND ORS.

Citation: [2003] SUPP. 6 S.C.R. 293 · Decided: 27-11-2003 · Supreme Court of India · Bench: K.G. BALAKRISHNAN · Disposal: Dismissed

Judgment (excerpt)

HINDALCO INDUSTRIES LTD. 
A-
v. 
UNION OF INDIA AND ORS. 
NOVEMBER 27, 2003 
[K.G. BALAKRISHNAN AND P. VENKATARAMA REDDI, JJ.] 
B 
Industrial Disputes Act, 1947: 
Section 25-0 and 25-0(8)-Procedure for closing down an under-
taking-Application of Section-On facts, company asked to stop mining C 
activWes and submit records for taking decision, letter not to the effect that 
undertaking will be closed immediately or with effect from any particular 
date-Company declaring lay off and subsequently mine closed-Company 
pleading that Section 25-0 not aplicable-Held: Section 25-0 is appli-
cable since the undertaking of an industrial establishment had to be closed D 
for reason beyond the control of employer-It cannot be said that it is 
attracted only to a voluntary and intended closure of an undertaking-
Further, when permission for closure of undertaking is granted where more 
than 100 workmen are employed on the average per working day, Section 
25-0(8) will apply for payment ofcompensation. 
Appellant-public limited company was carrying out mining ac-
tivities in the forest land. Divisional Forest Officer asked the appellant 
E 
to stop mining activities in the forest land and submit map and records 
for taking a decision in the matter. Appellant replied that their lease 
was valid upto January, 1997 and they may be permitted to continue F 
mining operations but the officer did not agree. Mining activities were 
stopped and lay off was declared from 31st July, 1993. Appellant closed 
the mine and sent notice of closure. Appellant filed application for 
permission to effect closure in abundant caution, even though Section 
25-0 of the Industrial Disputes Act, 1947 had no application as it was G: 
not a .voluntarily and intended closure of an undertaking. Appellant 
also contended that he was liable to pay compensation to the workers 
under Section 25-FFF. Application was not entertained as it was not 
filed before ninety days. Thereafter, the first respondent granted 
permission for closure as per the provisions of section 25-0 of the Act; 
and that compensation was to be paid under Section 25-0(8). H 
293 
294 
SUPREME COURT REPORTS (2003] SUPP. 6 S.C.R. 
A Appellant challenged the order but the same was rejected. Hence the 
present appeal. 
Appellant contended that Section 25-0 has no application to the 
instant case; that section 25 would apply only to a voluntary and 
B intended closure of an undertaking; that no prior permission was 
required for the closure of the mining activities as the appellant never 
intended to close it down before the expiry of the lease period; that as 
the mining operations were stopped due to unavoidable reasons, the 
appellant is liable to pay compensation to the workmen only under 
Section 25-FFF of the Act. 
c 
Dismissing the appeal, the Court 
HELD: 1.1. Section 25-0 of the Industrial Disputes Act, 1947 states 
that if an employer intended to close down an undertaking ofan industrial 
D establishment, he shall seek permission at least ninety days before the · 
date ofintended closure is to become effective. The reason for the intended 
closure also should be given in detail and the copy of such application 
shall be served on the representatives of the workmen in the prescribed 
manner. It cannot be accepted that Section 25-0 would apply only to a 
E voluntary and intended closure of an undertaking. If the undertaking of 
an industrial establishment is to be closed for reasons beyond the control 
of the employer, provision have been made under sub-Section 7 of Section 
25-0 of the Act. {299-H; 300-A~BJ . 
· 1.2. In the instant case, SeCtion 25-0 would govern the situation 
F as the appellant was asked to stop the mining activities in the forest 
land by the Divisional Forest Officer. It did not say that the mining 
activity shall be closed immediately or with effect from any particular . 
date; The appellant was asked to. produce map and other relevant 
records within a period of 5 days on which a decision was to be taken 
G in the matter. The appellant declared lay .off on 31st July, 1993 itself 
and the ~ines were closed on 19th August, 1993. No order has been 
produced by the appellant to· show from which date the mining 
operations were directed to be stopped by th~ forest au tho rides; n~r 
any other documents. -Furthermore, from the facts, it is not very clear 
H whether the appellant was disabled from obtaining prior perniissioit 
HINDALCO INDUSTRIES LTD. v. U.0.l. [BALAKRISH

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