The petitioner Ramco Super Leather Footwear Division closed the factory due to financial crisis. The Government, after considering the failure report, issued G.O.(D) No.1093, Labour and Employment Department, dated 20.11.2003 and referred the matter to the first respondent, the Industrial Tribunal. The Presiding Officer, Industrial Tribunal, Chennai answered Issue No.2, which was framed for as hereunder:
"Issue No.2: The illegal lock out made by the respondent/management from 15.04.2002 and more than 100 workers are working in the respondent factories. Therefore, as per Chapter V-B of the Industrial Disputes Act, 1947 applies and the respondent/management has to get permission from the Government under
Section 25-M of the Industrial Disputes Act, 1947. The respondent/management have not produced any balance sheet to prove for fixing the bonus. The respondent/company has not discharged their burden to prove that they are not having any sufficient allocable surplus in their account to pay the bonus. Since they have not produced their profit and loss account, I am of the view that the workers are entitled for bonus at 8.33% for year in question."
The Tribunal passed the award directing the petitioner to pay the wages from the month of December 2002 and also directed the petitioner Management to pay bonus @ 8.33%.
2. The award passed by the Tribunal is based on two reasons. One is that the Management was not in a position to produce sufficient evidence to disprove the claim of the employees in respect of payment/wages for the said period and the other reason is that the Management has not produced any acceptable reason for fixing the bonus. It was also the finding of the Tribunal that when there are more than 100 workers working in any factory, as per Chapter V-B of the Industrial Disputes Act, the Management has to get the prior permission under
Section 25-M of the Industrial Disputes Act, 1947. In the present case, the Tribunal found that the Management did not obtain prior permission from the Government under
Section 25-M and as such answered the reference in favour of the employees by holding that the workers are entitled to full wages and other benefits as per Industrial Disputes Act 1947 and also held that the workers are also entitled to back wages from December 2002. It further held that the workers are also entitled to payment of bonus at 8.33% for the year 2002. The said order is under challenge before this Court.
3. The main contention raised by the learned counsel appearing for the petitioner to set aside the impugned order passed by the Tribunal is that the Tribunal has entertained the reference from the Government, which has been made based on the dispute raised by an unrecognised Union and relied upon a judgment of the Karnataka High Court reported in CDJ 2005 Karnataka High Court 403-The President Labour Organization of HAL Versus The Management of Hindustan Aeronautics Ltd., wherein it has been held as follows:
"Section 2: A Industrial Dispute by Trade Unions can be raised only by a recognised Trade Union Only a recognised Union in an Industry can represent the workers of the said union Any Industrial dispute touching the entire workers of the establishment could be raised only by a recognised Union and not by an unrecognised union."
4. Further, the petitioner Management remained closed for the period from December 2002 onwards and as such, the Tribunal ought not to have given direction to pay back wages for the period during the said period. The Tribunal had erroneously proceeded on the footing that the closure of the business for a short period of time cannot be wrongly appreciated as closure of the entire business in an establishment, which is not correct. The intention of the petitioner Management was to close the factory for a temporary period, since they were not able to run the factory due to financial constraint caused by the recession experienced not only in the State of Tamil Nadu but all over the world. While canvassing the other point that the workman cannot insist on payment of bonus for the year 2002, which period the petitioner Management had remained closed and did not earn profit, the Tribunal has wrongly proceeded to issue direction directing the petitioner management to pay bonus @ 8.33% to the workman for the year 2002 which is not justified. In entirety, it is contended that the Tribunal, while analysing the issues framed for adjudication has not legally analysed the issues. Therefore, counsel appearing for the petitioner management prayed to set aside the impugned order passed by the Tribunal on the ground that the petitioner Management is making all efforts to revive the industry soon and only thereafter it will be in a position to recover from the financial problem and therefore learned counsel prayed for setting aside the impugned order, by allowing this petition.
5. On the other hand, learned counsel appearing for the 2nd respondent/workman has brought to the notice of this Court Section 2K of the Industrial Disputes Act and contended that to improve the financial condition of the company, the petitioner management should have declared holiday and even now the petitioner management is trying to revive the factory and therefore the leave declared by the petitioner management would show their good intention to reopen the company. It is further stated that the union was not a recognised one and hence the provisions of Section 2K of Industrial Disputes Act will not be attracted. Further, learned counsel appearing for the 2nd respondent also submitted that the petitioner Management has closed the factory without seeking prior permission as contemplated under
Section 25-N and 25-O of the Industrial Disputes Act, which Sections specifically contemplate that the employer who intends to close the factory shall apply for prior permission atleast ninety days before the date on which the intended closure is to take place. In support of this submission, the judgment reported in 2005 3 SCC 224-Oswal Agro Furane Ltd. and another -vs- Oswal Agro Furane Workers Union and others was relied upon wherein the Apex Court has held that Section 25-O of the Industrial Disputes Act provides for the procedure for closing down an industrial undertaking with prior permission atleast ninety days before the date on which the closure is to take place. Therefore, the findings of the Industrial Tribunal directing the petitioner Management to pay the salary to the employees for the period during which the establishment remained closed cannot be found fault with. On the question of payment of bonus the Tribunal held that the respondent Management has not produced any balance sheet for fixing the bonus and has not discharged their burden to prove that they are not having any sufficient allocable surplus in their account to pay the bonus. Further, the petitioner Management also have not produced their profit and loss account so as to decide the factum of bonus to the employees for the year 2002.
6. In view of the aforesaid reasons as found by the Tribunal, this Court finds that the action of the petitioner is not justified and the workers are entitled for full wages and bonus as per the Industrial Disputes Act, 1947 and are also entitled for payment of bonus @ 8.33% for the year 2002. In view of the fact that the matter has been decided on the basis of the evidence produced before the Tribunal, in the absence of any error, indicated in the award passed by the Tribunal, this Court is not inclined to entertain the Writ Petition and the same is dismissed. No costs.
03.12.2009 vga To The Presiding Officer, Industrial Tribunal Tamil Nadu, Chennai-104 T.RAJA, J.
vga W.P. No.11996 of 2009 03.12.2009