HINDUSTAN LEVER EMPLOYEES UNION Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) The Hindustan Lever Limited, the second respondent herein, discontinued the manufacture of their product Rin in their Sewri Plant at Bombay with effect from April 1988. The petitioners, the employees Union, have come up with a grievance that this amounts to a closure as contemplated under section 2(c) of the Industrial Disputes Act. Since the Management has not obtained permission under section 25-O to close down they are liable for being prosecuted under section 25-O. The petitioners seek a writ of mandamus directing the State of Maharashtra, the first respondent herein, to prosecute the second respondent and its Chairman for their unlawful closure of the Rin Department.

(2.) Mr. Singhvi, the learned Advocate appearing in support of the petition, strenuously submitted that though the discontinuance of the manufacture of the product Rin has not brought about retrenchment of the workers, since the workers have been re-employed in other departments, this was a modus operandi which would enable the Management to seek retrenchment at a later date on the ground that the workers have become surplus. He further contended that the Management had transferred the manufacture of Rin from the Sewri Plant to its Plant at Mangalore and Chhindwara where the workers were not as well organized as the petitioners. The Management would thus employ cheaper labour and this would adversely affect the workers in Bombay in the long run. He placed reliance on the definition of the term "Closure" found in section 2(cc) wherein it is provided Closure means the permanent closing down of a place of employment or part thereof. According to him, discontinuance of the manufacture of Rin amounts to permanent closing down of a part of a place of employment. He further placed reliance on the provisions of section 25-O and submitted that before such a closure could be resorted to, an application was required to be made for obtaining permission. Placing reliance on sub-section (2) of section 25-O, he submitted that on such an application being made, the appropriate Government was required to be satisfied that the reasons given for intended closure of the undertaking are adequate and sufficient and are urged in good faith and are fair and just. It is further required to be satisfied that the closure would not be prejudicial to the interest of the general public. It is only on such satisfaction being reached that permission to close down can be granted. Thus, according to Mr. Singhvi, retrenchment of workmen is not a sine qua non for making an application for permission to close down. Even if there was no retrenchment, permission to close down can adequately be refused if the aforesaid reasons are not satisfied.

(3.) In my judgment, there is no merit in the aforesaid contentions. Merely because the second respondent has chosen to discontinue the manufacture of one of its products, it cannot be held that it has closed down a part of its undertaking. The Second Respondent is multi-product manufacturing company. It manufactures various products in its Sewri factory. Under Clause 8 of the Standing Orders confirmed by the Industrial Court, the management has been given authority to transfer an employee from one department to another or from one shift to another. This is one of the terms and conditions of service of the employees. I am not impressed by the contention of Mr. Singhvi that a closure which is contemplated under section 25-O need not be related to the retrenchment of workers. Sub-clause (8) of section 25-O provides---