Jj
THE MANAGING DIRECTOR HARYANA SEEDS
DEVELOPMENT CORPN. LTD.
v.
THE PRESIDING OFFICER AND ANR. ETC.
JULY 7, 1997
[K. RAMASWAMY AND D.P. WADHWA, JJ.]
Labour Laws:
Industrial Disputes Act, 1947:
S. 25-F-Retrenchment compensation-Non-payment on the ground of
closure of the industry--Labour Court passing an award that the retrenchment
A
B
c
was bad in law-High Court affi1ming the award-On appeal held, as a
consequence of closure of industry, S. 25-F not attracted and the rigour
impo:.ed thereunder stands excluded-Hence the award of Labour Court set D
aside-If juniors retrenched had been appointed subsequently, respon-
dent-workmen also entitled, for appointment afresh.
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4609 of
1997 etc.
From the Judgment and Order dated 23.8.96 of the Punjab &
Haryana High Court in C.W.P. No. 12867 of 1996.
Ashok K. Patharia, Rajesh K. Sharma, Shalu Sharma and Goodwill
Indeevar for the Appellant.
K.B. Rohtagi and Ms. Aparna Rohtagi for tl.e Respondents.
The following Order of the Court was delivered :
Leave granted.
These appeals by special leave arise from the orders of the Punjab
& Haryana High Court, made on 23.8.1996 in CWP No. 12867/96 and
12866/96.
E
F
G
The admitted position is that the Haryana Seeds Development Cor-
poration Ltd. has been carrying on the business of distribution of the H
465
466
SUPREME COURT REPORTS (1997] SUPP. J S.C.R.
A
certified varieties of the crop seeds to the farmers during Rabi and Kharif
sowing seasons. As a consequence, a number of employees including the
salesman like the respondents came to be appointed. It is also on record
that due to heavy flood etc., a number of units including the seeds sales
counter were closed. As a consequence, the services of the employees have
B been dispensed with. The respondents have sought a reference under
Section lO(l)(c) of the Industrial Disputes Act, 1947 (for short, the "Act"].
The Labour Court held that the dispensation of the services of the respon-
dents amounts to retrenchment within the meaning of Section 25-F of the
Act. As a result without giving one month's notice or salary in lieu thereof,
the retrenchment is bad in law. Accordingly, it passed the award which was
C affirmed by the High Court. Thus, these appeals by special leave.
D
E
F
Section 25-FFF of the Act regulates the closure of the industry which
envisages as under:
"25-FFF. Compensation to workman in case of closing down of
undertaking - (1) where an undertaking is closed down for any
reason whatsoever, every workman who has been in continuous
service for not less than one year in that undertaking immediately
before such closure shall, subject to the provisions of sub-section
(2), be entitled to notice and compensation in accordance with the
provisions of Section 25-F, as if the workman had been retrenched;
Provided that where the undertaking is closed down on account
of unavoidable circumstances beyond the control of the employer
the compensation to be paid to the workman under clause (b) of
Section 25-F shall not exceed his average pay for three months."
As a consequence 'of the closure. of the industry, Section 25-F of the
Act is not attracted and the rigour imposed thereuqder stands excluded.
'That was the view taken by this Court. In other cases, that was also followed
by another learned Single Judge of the High Court. In that view of the
G matter, the learned Single Judge has committed grievous error of law in
not admitting the writ petition.
The appeals are accordingly allowed. The order of the Labour Court
stands set aside. No costs.
"
H
However, Shri K.B. Rohtagi, learned counsel appearing for the
MANAGING DIRECTOR HAR YANA SEEDS DEVELOPMENT CORPN. v. PRESIDING OFFICER
467
respondents in paragraph 5 of the counter-affidavit has stated that all other A
junior persons whose services were dispensed with along with the respon-
dents came to be appointed subsequently. If that be so, it would be open
to the respondents to make represent;itions to the Corporation and the
Corporation would consider their representations. If any of the other junior
persons were appointed, necessarily the respondents also are entitled for B
appointment afresh.
G.N.
Appeals allowed.
Lex