HINDOOSTAN CROWN MILLS SIDDHIVINAYAK KAMGAR KARMACHARI SANGHARSHA SANGHATANA Vs. HINDOOSTAN SPG AND WVG MILLS LTD

JUDGEMENT

(1.) HINDOOSTAN Spinning and Weaving Mills Ltd. moved two applications before the Commissioner of Labour on 10th April 2003 to seek permission to close down two of its industrial establishments: (i) The Crown Mills Division situated at Gokhale Road, Prabhadevi, Mumbai and (ii) The Process House Unit at Yadav Patil Lane, Veer Savarkar Marg, Prabhadevi, Mumbai. The Commissioner of Labour granted permission, the result whereof would be to render 597 workmen destitute of work and, destitute of a gainful source of employment. An application for review of this order under Section 25-O(5) of the Industrial Disputes Act, 1947, was filed by the Siddhivinayak Kamgar Karmachari Sangharsha Sanghatana of Crown Mills and the Process House Unit. On 15th July 2003, the Commissioner of Labour made a reference to adjudication. That reference has culminated in an award of the Industrial Tribunal dated 21st February 2004 confirming the closure permission subject to (i) closure compensation being paid within 30 days of the publication of the award; (ii) a direction that the workmen would be paid either the closure compensation under Section 25-O or the payment due under an agreement arrived at with the Rashtriya Mill Mazdoor Sangh for offering Voluntary Retirement on 29th December 2002, whichever is more beneficial, within 30 days; and (iii) The payment to those employees who had opted for voluntary retirement, of the moneys due and payable under the agreement dated 29th December 2002 within 30 days. The Court has two proceedings - W.P. 1097 of 2004 by the Union and W. P. 1762 of 2003 by the management. The management is aggrieved by the conditions which the award imposes, while the Union is in a fundamental sense aggrieved by the grant of closure permission. When these Writ Petitions came up for hearing, there was an agreement between Learned Counsel before the Court from all sides that both in the interests of enabling the parties to understand their own positions with certainty and having regard to the seminal issues that are involved, it would be in the interests of justice that the petitions be disposed of finally at the stage of admission. Pleadings have been completed and the matters have been heard, with the consent of Counsel, for hearing and final disposal at the stage of admission. Rule is accordingly issued and the petitions are, by consent taken up for hearing and final disposal, the Counsel having waived service.

(2.) THE history of the City of Mumbai is in a significant manner interlinked with the fortunes of textile mills which dot its landscape. Land prices increased over the last few decades, perhaps beyond the wildest expectations of the enterprenuers who set up these enterprises in the century before Independence. The lands where the Mills are situated provide a fertile avenue for commercial exploitation. The Industrial Units, or at least such of them as survive the vicissitudes of time, provide gainful employment to thousands of industrial workers. Upon the fate of these workers rest the hopes and aspirations of thousands of families whom they support here in Mumbai and in rural Maharashtra. In a fundamental sense, the social fabric of an industrial society based in middle class neighbourhoods of metropolitan Mumbai, depends upon the outcome of proceedings such as the one here, under Section 25-O. Bereft of a source of gainful employment upon the closure of industrial establishments which are the source of their earnings, industrial workers are confronted with destitution and marginalization. The role of the Court is undoubtedly to interpret and apply the legal principles governing its jurisdiction under Section 25-O. The jurisdiction of the High Court is in a sense structured by restraints which we observe while discharging our obligations under Article 226 of the Constitution. Equally, and this is necessary as a prefatory comment, the jurisdiction under Article 226 is a jurisdiction in aid of justice. In an era of globalization, Courts are conscious as they must be, of the needs of industry in a competitive business environment. The Court as an expounder of constitutional precept cannot, however, lose sight of the fundamentals underlying our social order based as they are on the Directive Principles of State Policy under the Constitution and the social ethos underlying statutory provisions such as Section 25-O. So long as Section 25-O remains a part, and I may add a vibrant part, of the statute book, the Court must discharge its solemn duty of enquiring as to whether genuine and adequate grounds for closure have been made out. More so, in a case such as the present, where industrial history spanning over a hundred years is sought to be substituted by the exigencies of real estate development raising fundamental questions of existence for 600 workmen and their families.

(3.) ON 29th December 2002, VRS agreements were entered into by the Company with Rashtriya Mill Mazdoor Sangh (RMMS) -the recognised Union in respect of Crown Mills and the Process House Division. The VRS agreements inter alia brought within their coverage, employees who had not completed 60 years of age as on the date of the submission of the application for voluntary retirement and who were on the muster rolls of the Company. Clause 2 of the agreement lays down the compensation that was payable and clause 3, the schedule of payment. The Company agreed to issue post-dated cheques but clause 3(g) laid down that in the event that the Company was unable to raise funds as visualized therein, due to unavoidable circumstances, after relieving the employees, the Company in consultation with RMMS would inform both RMMS and the employees individually, not to deposit the cheques in their Bank Accounts. In such cases, the employees would be paid interest at a rate 1% higher than what is payable by nationalized Banks for fixed deposits, on the delayed part of payment. The employees, it was provided, will not take recourse to any legal proceedings. Clause 4(k) of VRS Agreement is material for the present purposes, for it provided that employees who will not opt for voluntary retirement, would be re-deployed by the Company, if necessary, by reorganizing and restructuring manufacturing activities in any of the Industrial Units of the Company. Clause 4(k) inter alia provided as follows: