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TMI Blog1956 (11) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... and worked a light railway between Barsi Town and Barsi Road Station on the railway system, known then as the Great Indian Peninsular Railway. It is not necessary to state here the various clauses of the aforesaid indenture of agreement except to mention that it contained a Clause under which the Secretary of State could purchase and take over the undertaking after giving the railway company not less than twelve calendar months' notice in writing of the intention so to do. On 19 December 1952 a notice was given to the railway company, for and on behalf of the President of India, by the Director of the Railway Board to the effect that the undertaking of the railway company would be purchased and taken over as from 1 January 1954. The notice stated inter alia: The President of India hereby gives this notice to the company of the determination of the original contract of the first day of August 1895 and the contract of the 26 day of August 1902 between the Secretary of State in Council and the Barsi Light Railway Company, Ltd., and of all the contracts supplemental thereto, at the expiration of twelve calendar months next after the current month and the contract shall terminate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hough the pay which they actually drew at the time of re-employment was not affected; only about 24 of the former employees of the railway company declined service under the Government. 2. Soon after, Respondent 1 filed some sixty-one applications on behalf of the erstwhile workmen of the railway company Under Section 15 of the Payment of Wages Act, 1936, for payment of retrenchment compensation to the said workmen Under Clause (b) of Section 25F of the Industrial Disputes Act, 1947 (hereinafter called the Act). The applications were made to Respondents, Civil Judge (Junior Division), Madha, who was the relevant authority under the Payment of Wages Act, 1936. 3. These applications were contested by the present Appellants and several issues were framed. Three of the issues were: (1) whether the authority under the Payment of Wages Act. 1936, had jurisdiction to deal with and adjudicate on the claim of retrenchment compensation; (2) whether the erstwhile workmen were entitled to claim compensation Under Clause (b) of Section 25F of the Act; and (3) whether they had been retrenched by their former employer, the present Appellants on 31 December 1953 within the meaning o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ills, Ltd., Baroda, and the principal Respondent is the district labour officer and inspector under the Payment of Wages Act, 1936, at Baroda. The Appellant company was running a woollen mill at Baroda for several years and had in its employ at the relevant time 450 workmen and 20 clerks. The work was done in shifts, day and night. On or about 31 October 1953, the Appellant put up a notice declaring its intention to close down the entire mills from 1 December 1953. On 19 November 1953 this notice was withdrawn and Anr. notice was put up declaring the intention of the Appellant to close down the second shift with effect from 20 December 1953. A third notice was put up saying that the second shift would be closed on 20 December 1953, as notified earlier, and the first shift would be closed as from 8 January 1954. A similar notice was put up on the same date terminating the services of the clerks with effect from 19 January 1954. It was not disputed that though the steps in the process of closure of the business of the Appellant company were staggered, the process was really one, and as a result of the closure the services of all 450 workmen and 20 clerks were terminated. The Appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laim for retrenchment compensation, if found to be legally valid, can still be enforced against the Appellants. Section 19 of the Industrial Disputes (Amendment and Miscellaneous Provisions) Act, 1956, purports to repeal Section 25I of the principal Act, but that Section has not yet been brought into force with the result that the provisions of Section 25I are still available for the recovery of retrenchment compensation. Learned Counsel has, therefore, submitted before us that these Appellants will be content to abide by our decision on the principal question in these two appeals, namely the validity or otherwise of the claim for retrenchment compensation Under Clause (b) of Section 25F of the Act. 9. The Act which has been in force since 1 April 1947 has had a plexus of amendments, and some of the recent amendments have been quite extensive in nature. Section 25F occurs in Chap. VA of the Act; that chapter dealing with lay-off and retrenchment was inserted by an amending Act (Act XLIII of 1953) in 1953. Section 25F is in these terms: No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nition is in very wide terms. The question, however, before us is: does this definition merely give effect to the ordinary, accepted notion of retrenchment in an existing or running industry by embodying the notion in apt and readily intelligible words or does it go so far beyond the accepted notion of retrenchment as to include the termination of services of all workmen in an industry when the industry itself ceases to exist on a bona fide closure or discontinuance of his business by the employer ? Learned Counsel for the Appellants contend that the first gives the correct meaning of the definition, while learned Counsel for the principal Respondents urge that by reason of the wide words used in the definition, the second gives the correct meaning of the expression retrenchment. 13. There is no doubt that when the Act itself provides a dictionary for the words used, we must look into that dictionary first for an interpretation of the words used in the statute. We are not concerned with any presumed intention of the legislature; our task is to get at the intention as expressed in the statute. Therefore, we propose first to examine the language of the definition and see if the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of reasons, e.g., for economy, rationalization in industry, installation of a new labour-saving machinery, etc. The legislature in using the expression any reason whatsoever says in effect: It does not matter why you are discharging the surplus; if the other requirements of the definition are fulfilled, then it is retrenchment. 15. In the absence of any compelling words to indicate that the intention was even to include a bona fide closure of the whole business, it would, we think, be divorcing the expression altogether from its context to give it such a wide meaning as is contended for by learned Counsel for the Respondents. What is being defined is retrenchment, and that is the context of the definition. It is true that an artificial definition may include a meaning different from or in excess of the ordinary acceptation of the word which is the subject of definition; but there must then be compelling words to show that such a meaning different from or in excess of the ordinary meaning is intended. Where, within the framework of the ordinary acceptation of the word, every single requirement of the definition Clause is fulfilled, It would be wrong to take the definition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State of Madras [1954--I L.L.J. 469], fall outside the purview of the Industrial Disputes Act. 18. In view of these observations, it would be against the entire scheme of the Act to five the definition Clause relating to retrenchment such a meaning as would include within the definition termination of service of all workmen by the employer when the business itself ceases to exist. Learned Counsel for the Appellants in the two appeals have pointed out that the definition Clause is inartistically drawn up and Sub-cls. (a) and (b) of Section 2(oo) are not easily intelligible with reference to one of the essential requirements of the definition, namely, that the termination of service of the workman must be by the employer. It has been submitted that voluntary retirement of the workman cannot be termination of service by the employer. We do not, however, think that Sub-cls. (a), (b) and (c) are conclusive of the question before us; they, no doubt, apply to a running or continuing business only, but whether inserted by way of abundant caution or on account of excessive anxiety for clarity, they merely exclude certain categories of termination of service from the ambit of the definit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e way--that the Act contemplates an existing or continuing industry and not a dead industry. 21. This brings us to two other arguments advanced by the learned Attorney-General. One is that before the enactment of the amending Act of 1953 (Act XLIII of 1953) retrenchment had acquired a special meaning--a meaning which included the payment of compensation on a closure of business, and the legislature gave effect to that meaning in the definition Clause and by inserting Section 25F. The second argument is that Section 25FF inserted in 1955 (Act XLI of 1956) is parliamentary exposition of the meaning of the definition Clause and of Section 25F. We shall now consider these two arguments. 22. As to the first argument, a large number of decisions of industrial or Labour Appellate Tribunals have been placed before us. The learned Attorney-General has relied particularly on three decisions: Hyderabad Vege-table, Oil Products, Ltd. v. their workers [1950 L.L.J. 1281], Employees of India Reconstruction Corporation, Ltd., Calcutta v. India Reconstruction Corporation (1953 L.A.C. 563], Kandan Textiles, Ltd. v. their workers [1954--II L.L.J. 249]. The decision in Employees of India Recon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business the legislature would have said so instead of being content by merely adding a definition clause, every requirement of which is fulfilled by the ordinary, accepted meaning of the word retrenchment. 23. We turn now to the second argument. We have said that Section 25FF was inserted in 1956 by amending Act XLI of 1956, which came into force on 4 September 1956. Before that date the two decisions under appeal had been given by the Bombay High Court as also a further decision in Hospital Mazdoor Sabha v. State of Bombay [58 Bom. L.R. 769 : 1957--I L.L.J. 55] where it was held that the failure to comply with the condition for payment of compensation to an employee at the time of his retrenchment Under Section 25F(b) of the Act gave the employee the right to challenge his retrenchment and to contend that his services were not legally and effectively terminated. Faced with the situation created by those decisions, the legislature stepped in and enacted Section 25FF. That Section is in these terms: Notwithstanding anything contained in Section 25F. no workman shall be entitled to compensation under that Section by reason merely of the fact that there has been a change of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re could not declare the decision to be incorrect, but could partially supersede their effect by an amendment of the law. These were the circumstances in which Section 25FF was enacted. We agree with learned Counsel for the Appellants that the aim or object of the enactment was to supersede partially the effect of the aforesaid judicial decisions, at least with regard to the argent matter of change of ownership or management of a business undertaking which is of quite frequent occurrence, rather than parliamentary exposition of the pre-existing law: the general question of closure of business, of a lesser degree of urgency, was naturally left to be dealt with, if necessary, after the appeals had been disposed of. We are fortified in this view by an examination of the provisions of the Industrial Disputes (Amendment and Miscellaneous Provisions) Act, 1956. Be it noted that this Act was passed on 28 August 1956 only about seven days before the enactment of Section 25FF. Section 29 of the Industrial Disputes (Amendment and Miscellaneous Provisions) Act, 1956, inserts now schedules to the Act, and item 10 of Sch. III (matters within the jurisdiction of industrial tribunals) is: Retre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of Congress (Parliament in our case) and in construing a statute, we may with propriety recur to the history of the times when it was passed. 27. That history shows indubitably the aim and purpose of the enactment of Section 25FF. As Lord Atkinson pointed out in his speech in Ormond Investment Company v. Betta [1928 A.C. 143, 146]: an Act of Parliament does not alter the law by merely betraying an erroneous opinion of it. 28. Legislation founded on a mistaken or erroneous assumption has not the effect of making that the law which the legislature had erroneously assumed to be so. In the cases before us, the legislature proceeded on the basis of the judicial decisions then available to it, and on that basis enacted Section 25FF. We do not think that the general principle of parliamentary exposition or subsequent legislation as an aid to construction of prior Acts can be called in aid for construing the definition Clause and Section 25F of the Act. 29. For the reasons given above, we hold, contrary to the view expressed by the Bombay High Court, that retrenchment as defined in Section 2(oo) and as used in Section 25F has no wider meaning than the ordinary, accepted conn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a restriction on that right, if the Section is so widely interpreted as to include a closure of business. The restriction, it is submitted, is not a reasonable restriction in the interests of the general public because (a) it is unrelated to the capacity of the employer to pay and (b) unrelated to the needs of the employee. From the other point of view, the argument is that even in respect of a running or continuing industry, Section 25F imposes an unreasonable restriction. Reasonableness, it is submitted, has to be considered with regard to the object of the legislation and if the direct and immediate object of Section 25F is relief against involuntary unemployment, then the restriction imposed is excessive, because a provision for such relief unrelated to the period of unemployment and other relevant factors is over-simplification of a complex problem. Such over-simplification, it is stated, itself amounts to an unreasonable restriction. 32. On the construction which we have adopted of the definition Clause and of Section 25F of the Act, we are relieved of the task of making any final pronouncement on this constitutional question. On our construction, Section 25F has no appli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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