CHEMICAL MAZDOOR SABHA Vs. VITAL ORGANICS PRIVATE LIMITED

JUDGEMENT

(1.) THIS writ petition under Articles 226 and 227 of the Constitution of India is directed against an Award dated 30th July, 1987 made by the Industrial Tribunal, Thane, in Reference (IT) No. 3 of 1985 and raises an important question as to the true construction of Rule 81 of the Industrial Disputes (Bombay) Rules, 1957.

(2.) THE petitioner is a registered Trade union which represents workmen employed in the Chemical Industry. The first respondent is an Employer carrying on the business of manufacture of Organic Chemicals at Roha in District Raigad. During the Financial Year, 1984-1985, changes were made in the import policy for the year; which had adverse effect on the Companys business, as a consequence of which the first respondent Company decided to retrench as many as 51 workmen out of the total work-force of about 67. By a notice dated 31st August, 1984 displayed on the Notice Board, the first respondent Company retrenched 51 workmen on the ground that they had become surplus to requirement as its operations had become uneconomical consequent upon change in import policy of the Government of India. The first respondent Company also simultaneously displayed on the Notice Board a seniority list, as required by Rule 81 of the Industrial Disputes (Bombay) Rules, 1957. It is not disputed that the said notice was not displayed seven days prior to the proposed date of retrenchment. All the workmen retrenched on 31st August, 1984 were unconditionally tendered wages in lieu of notice of one month and retrenchment compensation, as required respectively under Clauses (a) and (b) of section 25-F of the Industrial Disputes Act (hereinafter referred to as the Act ). Some of the workmen accepted the offered Notice Wages and compensation. The petitioner Union raised an industrial dispute demanding that the 51 workmen retrenched by the first respondent Company on 31st August, 1984, be reinstated with continuity of service and full back wages. The said industrial dispute was referred to the Industrial Tribunal, Thane and marked as Reference (IT) No. 3 of 1985.

(3.) THE Industrial Tribunal recorded detailed evidence and accepted the case of the first respondent Employer that there was a change in the import policy of the Government of India during the relevant financial year which had an adverse impact on the first respondents business. It also accepted the case of the first respondent Employer that the change in the import policy had rendered the operations of the manufacturing activity uneconomical, leading to large scale retrenchment. In other words, the Industrial Tribunal completely accepted the case of the first respondent Employer that there were bona fide circumstances justifying the retrenchment of 51 workmen. The Industrial Tribunal then examined the question as to whether there was contravention of the provisions of section 25-F and section 25-G of the Act. After having carefully appraised the evidence, the Industrial Tribunal recorded its finding that the retrenchment had been effected in full compliance with the provisions of section 25-F, particularly, Clauses (a) and (b) thereof and that the principle of "last come first go" had been complied with. The Industrial Tribunal, however, held that there was no strict compliance with Rule 81 of the Industrial Disputes (Bombay) Rules, though it was of the view that there was substantial compliance therewith. Purportedly following the law laid down by the Division Bench of this Court in (Nav Bharat Hindi Daily, Nagpur v. Nav Bharat Shramik Sangha and another) 1985 (1) L. L. J. 474, the Industrial Tribunal held that Rule 81 was mandatory and non-compliance therewith would render the retrenchment illegal, non-est and non-est ab initio. In this view of the matter, the Industrial Tribunal held that retrenchment of the 51 concerned workmen by the first respondent Company on 31st August, 1984, was invalid and illegal. It also directed that, in addition to the payment of legal dues of the workmen concerned, the first respondent Company should also pay three months wages as compensation to each of the workmen, in lieu of reinstatement, and pay Rs. 100/- each as costs. Though the first respondent Employer has not challenged the Award the petitioner Union has challenged the Award by the present writ petition.