Andhra Pradesh High Court Upholds Labour Court's Decision in Industrial Dispute Case

Court dismisses petition challenging retrenchment, emphasizes limited scope of interference in Labour Court findings

In a significant judgment, the Andhra Pradesh High Court has dismissed a writ petition challenging the award of the Industrial Tribunal-cum-Labour Court, Guntur, which upheld the retrenchment of a worker by M/s. Krishna Industrial Corporation Ltd. The case, G. Ram Babu v. State of Andhra Pradesh, centered around the closure of a unit due to unavoidable circumstances and the subsequent retrenchment of its employees.

The petitioner, G. Ram Babu, initially joined M/s. Krishna Industrial Corporation Ltd. as a probationary worker and was later confirmed. However, due to a stoppage in the supply of raw materials from M/s. KCP Sugar & Industrial Corporation Ltd., the operations of the company came to a halt, leading to the retrenchment of the petitioner and other workers in April 2007. The company cited the closure due to unavoidable circumstances and provided compensation as per Section 25FFF of the Industrial Disputes Act, 1947.

Aggrieved by the retrenchment, Ram Babu filed an industrial dispute seeking reinstatement with back wages. However, the Labour Court dismissed his claim, leading to the present writ petition before the High Court.

Justice Maheswara Rao Kuncheam, hearing the petition, emphasized that the High Court's scope to interfere with the Labour Court's findings is limited. The court does not act as an appellate authority to re-assess the facts or re-appreciate the evidence unless there is a glaring error of law, breach of natural justice, or excess of jurisdiction by the Labour Court.

The court further clarified that under Section 25FFF of the Industrial Disputes Act, the closure of a unit due to unavoidable circumstances entitles workmen to compensation but not reinstatement. The judgment referenced the Supreme Court's rulings, affirming that the provisions of Section 25FFF apply in cases of closure and that compensation is the remedy provided, not reinstatement.

The court found no violation of statutory provisions in the actions of the 3rd respondent corporation and concluded that the Labour Court's decision was justified based on the evidence and circumstances presented.

In conclusion, the High Court dismissed the writ petition, upholding the Labour Court's award and reiterating the legal position that compensation, not reinstatement, is the remedy under Section 25FFF in cases of closure due to unavoidable circumstances.

Bottom Line:

Industrial Disputes Act, 1947 - Closure of unit due to unavoidable circumstances - Compensation to workmen under Section 25FFF - High Court's limited scope to interfere with Labour Court's findings under Article 226 of Constitution of India.

Statutory provision(s): Industrial Disputes Act, 1947 Sections 25F, 25FFF; Constitution of India, 1950 Article 226.

G. Ram Babu v. State of Andhra Pradesh, (Andhra Pradesh) : Law Finder Doc Id # 2800345