Full Judgment Text
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PETITIONER:
ASHOK KUMAR JAIN AND OTHERS
Vs.
RESPONDENT:
THE STATE OF BIHAR AND OTHERS
DATE OF JUDGMENT08/12/1994
BENCH:
RAY, G.N. (J)
BENCH:
RAY, G.N. (J)
HANSARIA B.L. (J)
CITATION:
1995 SCC (1) 516 JT 1995 (1) 150
1994 SCALE (5)187
ACT:
HEADNOTE:
JUDGMENT:
G.N.RAY, J.:
1. The appellants in these criminal appeals arc Chairman,
Managing Director and other senior officials in the
management of the Rohtas Industries Limited a company
registered under the Indian Companies Act and engaged in the
manufacture and sale of variety of products namely cement,
vanaspati, paper asbestos, cement products etc. The
factories owned by the company were situated at Dalmianagar
in the district of Rohtas, Bihar, wherein about 15000
workers were engaged. The Company had a contract with Bihar
State Electricity Board for the supply of 25000 KVA of
electricity and the Company was to pay 75% of the
electricity charges irrespective of the fact whether such
supply for running its factories and establishments were
made. The case of the Company is that due to chronic
shortage of power supply ever since 1981 varying between
11.5 to 7.3 MW. of electricity per diem, the productive
activities of the Company suffered immensely. The.
Electricity: Board made demand for payment of Bill including
enhanced fuel surcharge for the period 1977-80 and 1980-81
which stood at Rs. 72,61,010,70.00. The Company moved writ
petitions in Patna High Court for quashing supplementary
Bills but such writ petitions were dismissed. The Company’s
attempt to clear dues of the Electricity
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Board by instalments also failed. The Board disconnected
electric connection to the Company’s factories and
establishments for which the Company suffered a serious set
back. The Company resorted to lay off of its workers without
obtaining prior permission of the concerned authority. For
such action of lay off, complaints were filed by the
Superintendent of Labour, Dalmianagar before the Chief
Judicial Magistrate’ Sasaram who took cognizance of the
offence under Section 25-M read with Section 25-O of the
Industrial Disputes Act. The appellants moved the Patna High
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Court for quashing the complaint by challenging the
maintainability of the said criminal cases by contending
that Section 25-M in so far as it required permission tO lay
off was ultra vires the Constitution of India. The
appellants also contended that lay off was necessitated
because of power failure on account of insufficient and
irregular supply of power by the Electricity Board and some
other reasons beyond the control of the Company or the
appellants. It was also contended that the appellants could
not be held an employer for the purpose of prosecution for
the offence under Section 25-M read with Section 25-Q of the
Industrial Disputes Act. The High Court of Patna held inter
alia that the Section 25-M was ultra vires the Constitution
and the complaint prima facie disclosed offence under the
said provisions. Hence, taking of cognizance by the Chief
Judicial Magistrate could not be held illegal or invalid
warranting quashing of the complaint. The High Court,
however, held that it was only just and proper in the facts
and circumstances of the case, that the Magistrate would
hold enquiry under Section 202 of the Code of Criminal
Procedure for the purpose of ascertaining as to whether the
appellants or any one of them could be held to be employer
so that they could be summoned to stand trial for the
aforesaid offence. The High Court therefore allowed the said
applications for quashing the criminal proceedings only to
the extent indicated above.
2. Against the aforesaid decisions of the High Court
special leave petitions were moved before this Court which
have been admitted giving rise to these appeals. Further
proceedings and prosecution of the criminal cases have been
stayed by this Court on 22.2.1985. Mr. Jain, learned Senior
Advocate appearing for the appellants has contended that the
vires of Section 25-M(2) cannot be upheld for the reasons
indicated by this Court in Excel Wear’s case. He has
submitted that Madras High Court has held the said provision
as constitutionally invalid and the appeal from such
decision is pending disposal before this Court. That apart,
lay off became inevitable on account of power failure
occasioned by short supply and irregular supply of power
seriously affecting productive activities. In the facts of
the case it is more than evident that the lay off was not
motivated or unjustified but such lay off had to be resorted
for compulsive circumstances beyond the control of the
company and its management including the appellants. He has
submitted that the Company became sick beyond revival and
all attempts to revive have failed. The Company is no longer
in the management of the factories and productive units.
Even if the vires of Section 25-M is upheld, in the facts of
the case, there is no difficulty in finding that there was
no lack of bonafide on the part of the Company and its
management in resorting to lay off. Such action had to be
taken to save the Company from being permanently sick. The
situa-
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tion was so grave that the management felt the need of
immediate lay off without waiting for permission as
contemplated under Section 25-M. That apart, Section 25-O
was declared ultra vires by this Court in Excel Wear’s case
and constitutional validity of Section 25-M for the reasons
indicated in Excel Wear’s case was seriously doubted. In
the aforesaid circumstances, the lay off without taking
prior permission cannot be held to be per se illegal and
unjustified and mala fide. The liability of the appellants
for being prosecuted under Section 25-M read with Section
25-Q, in any event, are doubtful. AS a matter of fact, the
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High Court has directed the Chief Judicial Magistrate to
first ascertain the liability of the appellants before
proceeding further with the criminal cases. In view of order
of stay granted by this Court, such enquiry has not yet been
held. After such a long lapse of time, resumption of
enquiry and the criminal proceedings will not serve any
practical purpose but the appellants are bound to suffer
irreparable loss and prejudice because of the changed
circumstances and long lapse of time. Mr. Jain has
submitted that the criminal cases should be quashed to
secure ends of justice. He has submitted that such power
has been exercised by this Court when the ends of justice
demanded such quashing although the criminal case was
validly instituted and was otherwise maintainable.
3. As the question of vires of Section 25-M of
Industrial Disputes Act was involved in these appeals and
also a Civil Appeal No. 807 of 1982 (arising out of the
decision of Madras High Court), all these matters were heard
analogously. We have upheld the vires of Section 25-M in the
decision rendered in Civil Appeal No. 807 of 1982. Hence,
the contention that Section 25-M being ultra vires, no
prosecution on account of violation of the provisions of
Section 25-M is maintainable, cannot be accepted.
4. It however appears to us that there is enough force in
the contention of Mr. Jain that in the special facts of the
case and in the altered scenario, the enquiry as directed by
the High Court need not be made and the criminal cases
instituted against the appellants need not be pursued any
further. Such course of action in our view is not only
within the scope and ambit of Section 482 of the Code of
Criminal Procedure but in the special facts of the case will
also secure the ends of justice. We, therefore, allow these
appeals and quash the criminal cases instituted against the
appellants for the alleged violation of Section 25-M of
Industrial Disputes Act, 1947.
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