Case Note & Summary
The case involves two appeals arising from a common order of a learned Single Judge of the Bombay High Court in Writ Petition No. 3146 of 2004. The background is that M/s Oriental Rubber Industries Limited (the employer) had a factory at Bhandup employing about 700 workmen. On 27th October 1980, the employer declared a lockout due to bad financial position, and in November 1980 decided to close the factory with effect from 5th January 1981. A closure notice dated 3rd November 1980 was issued under Section 25FFA of the Industrial Disputes Act, 1947. The trade union representing the workers filed a complaint (ULP No. 257 of 1980) before the Industrial Court, Thane, challenging the closure, which was dismissed on 8th March 1982, holding the closure notice valid. The factory was closed, and almost all workmen accepted their dues; unclaimed amounts were deposited with the Maharashtra Labour Welfare Board. The union filed another complaint (ULP No. 1006 of 1987) which was dismissed on 20th June 1988. The union then filed Writ Petition No. 2632 of 1988, dismissed by a Single Judge on 22nd June 1993, and an appeal against that was dismissed by a Division Bench on 9th March 1995. A Special Leave Petition to the Supreme Court was dismissed on 21st July 1997. Thereafter, 65 workmen who had not accepted their dues filed applications under Section 33C(2) of the Industrial Disputes Act before the Labour Court, claiming retrenchment compensation under Section 25FFF. The Labour Court allowed those applications. The employer challenged that order by filing Writ Petition No. 3146 of 2004, which was allowed by the learned Single Judge, setting aside the Labour Court's order. The workmen appealed (Appeal No. 517 of 2007) and the employer also appealed (Appeal (Lodging) No. 686 of 2007) against certain observations. The Division Bench dismissed both appeals, holding that the closure was valid, the workmen had already been compensated, and the claims were barred by limitation and res judicata.
Headnote
A) Industrial Law - Closure of Undertaking - Validity of Closure Notice - Section 25FFA, Industrial Disputes Act, 1947 - The closure notice dated 3rd November 1980 was held valid by the Industrial Court and upheld up to the Supreme Court; thus the closure was legal and valid. (Paras 2-4) B) Industrial Law - Retrenchment Compensation - Section 25FFF, Industrial Disputes Act, 1947 - Where closure is valid, workmen are entitled to compensation under Section 25FFF only if they have not been otherwise compensated; here, workmen had accepted their dues and the unclaimed balance was deposited with the Labour Welfare Board, hence no further compensation is payable. (Paras 5-6) C) Industrial Law - Limitation - Section 33C(2), Industrial Disputes Act, 1947 - Claims for retrenchment compensation filed after 20 years from closure are barred by limitation; the right to claim compensation accrues on the date of closure and must be claimed within a reasonable period. (Paras 7-8) D) Civil Procedure - Res Judicata - Constructive Res Judicata - The validity of closure having been finally adjudicated up to the Supreme Court, the workmen are precluded from reagitating the issue in subsequent proceedings under Section 33C(2). (Paras 4, 9)
Issue of Consideration
Whether the closure of the factory was valid and whether the workmen are entitled to retrenchment compensation under Section 25FFF of the Industrial Disputes Act, 1947, and whether the claim applications under Section 33C(2) were barred by limitation.
Final Decision
Both appeals dismissed. The order of the learned Single Judge setting aside the Labour Court's order is upheld. The workmen are not entitled to retrenchment compensation.
Law Points
- Closure of industrial undertaking
- validity of closure notice
- retrenchment compensation under Section 25FFF
- limitation for filing claims under Section 33C(2) of Industrial Disputes Act
- 1947
- res judicata
- constructive res judicata
