02-15-2005, 11:29 PM
<!--emo&:thumbdown--><img src='style_emoticons/<#EMO_DIR#>/thumbsdownsmileyanim.gif' border='0' style='vertical-align:middle' alt='thumbsdownsmileyanim.gif' /><!--endemo--> <!--QuoteBegin-->QUOTE<!--QuoteEBegin--><b>Industries need State's nod for closure: SC </b>
New Delhi
In an order having a significant bearing on industrial relations, the Supreme Court has ruled that an industrial unit cannot be closed down without prior permission of the State Government even if its management and the workers union arrive at an agreement to this effect.
A bench comprising Justice N Santosh Hegde and Justice SB Sinha said that Section 25-N and 25-O of the Industrial Disputes Act was clear that <b>the employer, who wanted to close down the industrial unit or retrench workmen, must apply for prior permission of the State at least 90 days before the date of intended closure</b>.
"Obtaining a prior permission from the appropriate Government, thus, must be held to be imperative in character," Justice Sinha, writing for the bench, said.
The case pertained to closure of Oswal Agro Furane Ltd on the basis of an agreement between the management and the workers union and the question for determination before the court was that whether the prior permission of State was still a condition precedent despite the agreement.
Answering the question in the affirmative, the bench said, "Section 25-N and Section 25-O being imperative in character would prevail over the right of the parties to arrive at a settlement. Such a settlement must conform to the statutory conditions laying down a public policy."
An agreement which opposed public policy as laid down in terms of Section 25-N and 25-O of the act would be void and of no effect, it said.
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New Delhi
In an order having a significant bearing on industrial relations, the Supreme Court has ruled that an industrial unit cannot be closed down without prior permission of the State Government even if its management and the workers union arrive at an agreement to this effect.
A bench comprising Justice N Santosh Hegde and Justice SB Sinha said that Section 25-N and 25-O of the Industrial Disputes Act was clear that <b>the employer, who wanted to close down the industrial unit or retrench workmen, must apply for prior permission of the State at least 90 days before the date of intended closure</b>.
"Obtaining a prior permission from the appropriate Government, thus, must be held to be imperative in character," Justice Sinha, writing for the bench, said.
The case pertained to closure of Oswal Agro Furane Ltd on the basis of an agreement between the management and the workers union and the question for determination before the court was that whether the prior permission of State was still a condition precedent despite the agreement.
Answering the question in the affirmative, the bench said, "Section 25-N and Section 25-O being imperative in character would prevail over the right of the parties to arrive at a settlement. Such a settlement must conform to the statutory conditions laying down a public policy."
An agreement which opposed public policy as laid down in terms of Section 25-N and 25-O of the act would be void and of no effect, it said.
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