MESSRS ANTI BIOTIC STORES PRIVATE LIMITED Vs. SHRI K.D. PRASAD, UNDER SECRETARY TO THE GOVERNMENT OF BIHAR, LABOUR & EMPLOYMENT DEPARTMENT, PATNA & OTHERS

JUDGEMENT

(1.) This writ application under Articles 226 and 227 of the Constitution of India has been filed by the petitioner for quashing a notification, dated the 12th December, 1975, issued by the State Government in exercise of powers conferred on it by rule 70 (3) of the Defence of India Rules, 1971 (hereinafter referred to as the 'Rules'), directing the petitioner -Company "to take immediate necessary measures to open its Patna Branch within ten days from the date of the issue of "the order" and to keep it open for the unimpeded employment of persons employed therein." A copy of the said notification is annexure "4" to the writ application. According to the petitioner, it carries on trade and business in medicine and thing connected therewith. The petitioner had sole selling and distribution agency in the State of Bihar of the goods manufactured by M/S. Borroughs Welcome Ltd., M/S. Neo Pharma Private Ltd., and others. Some time between January and April, 1975, the sole selling agency in the States of Bihar and Uttar Pradesh in respect of such Companies came to an end and the petitioner was left with no option but to close its business both at Patna and Lucknow. It is alleged that, on the 27th May, 1975, the petitioner notified the closure of its business and notices with respect to the same were given to all authorities concerned saying that the said closure of the business would be effective from the 1st August, 1975. A copy of the said notice given to the Secretary to the Government of Bihar in the Department of Labour and Employment, Patna, is annexure '1' to the writ application. According to the petitioner, the workmen were also informed by a notice, dated the 25th June, 1975. A copy of the said notice is annexure '2' to the writ application. It is the further case of the petitioner that, on receipt of the said notice of closure of its business, the workmen instituted Title Suit No. 95 of 1975 in the Third Court of the Munsif at Patna, who initially granted an ad interim injunction; but, later, on hearing the parties, vacated the same. An appeal against the said order was filed before the District Judge, which was heard by an Additional District Judge, who by his order, dated the 11th August, 1975, dismissed the said appeal filed on behalf of the workmen. A copy of the said order is annexure '3' to the writ application. The petitioner alleges that the closure of the business was complete after the dismissal of the aforesaid appeal on the 11th August, 1975. It is said that, out of 33 employees, 20 have already accepted retrenchment compensation. The remaining, however, are challenging the legality of the closure. The petitioner has stated in the writ application that the Labour Department wanted the petitioner to reopen its Patna office, but the petitioner expressed its inability in view of the termination of the agencies. Thereafter, the petitioner received the impugned notification directing the petitioner to take immediate measures to reopen its Patna Branch and keep it open for the unimpeded employment of the persons employed therein. The petitioner sent a reply to the said notice on the 18th December, 1975, setting out the circumstances in which the business at Patna had been closed. Petitioner's counsel, who went to hand over the said letter, was told that the notification issued was final and operative and that, if the Branch was not opened, action under sub -rule (4) of rule 70 of the Rules shall be taken against the petitioner. According to the petitioner the impugned notification is illegal, ultra vires and the purported exercise of the power under the Rules amounts to an invasion over the right of the petitioner to carry on trade and business.

(2.) A counter -affidavit has been filed on behalf of the respondents saying that the statement made in the writ application that the petitioner, had lost all agencies and has no business at Patna is incorrect; that only the agency of M/s. Burroughs Welcome & Co. (India) Private Ltd. had been terminated; that the petitioner continues to have the agency of M/s. Dolphin Laboratories Private Ltd., Calcutta and M/s. Lyka Laboratories, Bombay; and, as such, the petitioner has adequate business to keep its Patna Branch going on. It is further stated that the notice of closure, given by the petitioner was opposed by the Antibiotic Stores Employees' Union which raised an industrial dispute. The State Conciliation machinery intervened in the matter and tried to persuade the management not to close the establishment. The matter was discussed between the management and the union before the Assistant Labour Commissioner, Patna and also before the Deputy Labour Commissioner, Bihar, with no positive results and the establishment was finally closed with effect front the 11th August, 1975. It has been further stated that, in course of discussion, it had come to the notice of Government that the petitioner -Company had lost just a fraction of its business, that is, its agency of M/s. Burroughs Welcome & Co. Private Ltd; but it had still agencies of the other, manufacturers and that business was enough at least to keep and maintain 13 employees in its employment, and, as such, the State had to issue the impugned notification in exercise of the powers under rule 70 (3) of the Rules, after being satisfied that a place of employment had been closed for reasons other than the furtherance of an industrial dispute. It has also been asserted on behalf of the State in the said counter -affidavit that the representation of the petitioner, dated the 18th December, 1975 (annexure "3") was considered by the State Government and rejected and the decision was communicated by a letter, dated the 23rd December, 1975, a copy whereof is annexure 'X' to the counter -affidavit. According to the respondent -State, the closure of the Patna Branch is not a "closure of business," but is the "closure of a place of employment", inasmuch as the business of the petitioner is still flourishing and thriving and only its establishment at Patna has been closed.

(3.) After the writ application was admitted and rule was issued to the respondents to show cause, an application under rule 5 of Chapter XXs (C) of the Patna High Court Rule, was filed on behalf of three persons who are 3 of the 13 employees of the petitioner, referred to above, on the 16th January, 1976, praying that the order of admission passed by this Court on the 22nd December, 1975 be recalled. Another application was filed on the 19th January, 1976 on behalf of these persons seeking permission to add an additional prayer to the application filed on the 16th January, 1976. The said additional prayer was that the aforesaid three persons may be heard in opposition to the writ application under rule 5 of Chapter XXI (C) of the rules of this Court. During the course of the hearing of the writ application, on the 6th February, 1976, an order was passed saying that, as the aforesaid three persons were persons to be directly affected by the result of this writ application, they should be heard in accordance with the rules of this Court.