HARYANA LAND RECLAMATION AND DEVELOPMENT Vs. PAWAN KUMAR

JUDGEMENT

(1.) THIS judgment will also dispose of Letters Patent Appeal No. 820 of 1992, Civil Writ Petitions Nos. 13106, 14160 and 14161 of 1991, and Civil Writ Petition No. 6385 of 1992, as common question of law is involved therein and all these cases were heard together. For facility of reference, facts have been taken from Letters Patent Appeal No. 822 of 1992.

(2.) THE appellant is Haryana Land Reclamation and Development Corporation Limited hereinafter to be referred as "the Corporation") having its registered office at Chandigarh. Its main object is to undertake, assist, aid, finance, execute and promote measures for land development, conservation and improvement of soil and water resources. Pawan Kumar, respondent, was appointed as a clerk-cum-typist in the above Corporation on March 31, 1989, on ad hoc basis. His case is that he was retrenched by an order dated July 18, 1991. He filed a writ petition challenging the order of retrenchment on the ground that he had completed more than two years and in any case more than 240 days in the preceding twelve calendar months when the impugned order of retrenchment was passed. The retrenchment order has been annexed as Annexure P-1 to the writ petition. In the retrenchment order, it was categorically stated that while the turnover of the Corporation increased to Rs. 12 crores during the year 1990-91 as compared to Rs. 10. 80 crores during the year 1989-90, the increased expenditure on manpower and for other financial reasons, the Corporation suffered a net loss of Rs. 35 lakhs during the year 199091 as compared to a net profit of Rs. 49. 45 lakhs during the year 1989-90. In the light of heavy financial losses to the Corporation during the year 1990-91 and also in view of the fact that sale of fertilisers besides insecticides has been considerably less than anticipated in the last few months, and also due to other economic factors, it had become uneconomical to carry on the business activities of the Corporation at its present strength of staff. As such it was necessary to reduce clerical staff as well as peons who were recruited to assist in monitoring and maintaining the record of transaction as their services were no longer required. By the said order eleven clerks-cum-typists were declared surplus to the requirement of the Corporation as their retention in service any more would adversely affect the economic viability of the corporation and was likely to result in increased losses. Eleven employees, mentioned in the order, were consequently retrenched who were ad hoc employees of the Corporation. All the employees were served with a notice along with cash equivalent to one month's wages, in lieu of notice period, and the retrenchment compensation due under Section 25-F of the Industrial Disputes Act, 1947 (hereinafter to be referred to as "the Act") Pawan Kumar, respondent, was appointed, as already stated, as an ad hoc employee and it is admitted that he was working in the head office of the Corporation. He filed the writ petition on the ground that the order of retrenchment dated July 18, 1991 is violative of Section 25-N of the Act, and, consequently it is liable to be set aside. His case was that under Clause (b) of sub section (1) of Section 25-N of the Act, it was mandatory for the Corporation to obtain prior permission of the Government before retrenching a workman who has been in continuous service for not less than one year and since no permission had been taken for retrenchment, the retrenchment order was wholly invalid. His further case was that he was not given three month's notice in writing nor paid wages in lieu thereof as required by Clause (a) of Sub-section (1) of Section 25-N of the Act. The petition was allowed by the learned single judge, vide judgment dated July 15, 1992, holding that the Corporation is an industrial establishment and as such it was necessary before retrenchment of its employees that the Corporation should have complied with the requirements of Section 25-N of the Act and since this has not been done, the impugned retrenchment order was wholly invalid. The Corporation has now filed the present appeal against the order of the learned single judge, dated July 15, 1992.

(3.) SECTION 25-N of the Act is contained in Chapter V-B of the Act which provides for special provisions relating to lay-off, retrenchment and closure in certain establishments. Section 25-K of the Act specifically lays down that the provisions of this Chapter will apply to an industrial establishment in which not less than one hundred workmen were employed on an average per working day for the preceding twelve months. Section 25-L (a) defines "industrial establishment" for the purposes of this Chapter as follows: "industrial establishment' means