Air Noise Company Private Ltd. was suffering continuous losses as there was no work for employees for a long period. Considering the condition that there is no sufficient work for many of the employees, the company retre
CS Professional · Labour Laws and Practice · PYQS · June 2025
Air Noise Company Private Ltd. was suffering continuous losses as there was no work for employees for a long period. Considering the condition that there is no sufficient work for many of the employees, the company retrenched its 297 employees. The retrenchment was carried out under Section 25F of the Industrial Disputes Act, 1947 for three categories of employees namely Attender, Transmission and Engineering. The Company issued notices notifying retrenchment of 297 employees and the retrenchment letters were sent to the last known addresses of the employees by registered post citing reasons for retrenchment. The retrenchment letters were uploaded on the website of the Company and were pasted at the prominent places of each office of the Company. Each retrenchment letter had details of payment of notice pay and retrenchment compensation with the basis of calculation and the notice pay and retrenchment compensation were transferred in the bank account of each of the retrenched employees. The retrenched employees were requested to approach the company along with the relevant forms in case of any inadvertent calculation error. The Company also notified the Appropriate Authority in the prescribed form along with necessary formalities in compliance of Section 25F of the Industrial Disputes Act. The Company also displayed the notice giving the Seniority List of three categories of employees in compliance with Section 25G read with Rule 77 of the Industrial Disputes Act and it has strictly followed the principle of last come first go in the process of retrenchment. In the retrenchment letters, it was categorically mentioned that in case of re-employment the Company shall comply with Section 25G read with Rule 78 of the Industrial Disputes Act, 78 retrenched employees have accepted their retrenchment and have also withdrawn their gratuity amount. The Employee Union of the Company has filed writ petition challenging the retrenchment of 297 employees on various grounds that the Company is amenable to writ jurisdiction as it satisfies the public function test. Decide on the maintainability of the writ petition in brief. (Cite relevant case laws also, if applicable).
Answer & Explanation:
The law is well settled by the Supreme Court that a writ petition should not be entertained in respect of industrial disputes for which a statutory remedy is available under the Industrial Disputes Act, 1947 unless 'exceptional circumstances' are made out. The writ jurisdiction is a discretionary jurisdiction and the discretion should not ordinarily be exercised, if there is an alternative remedy available. The Sole Test laid down by the Supreme Court for entertaining a writ petition relating to an industrial dispute is the existence of 'exceptional circumstances'. If the Court is satisfied on the existence of 'exceptional circumstances', then and only then, the Court shall proceed to ascertain whether the writ involves disputed questions of fact. If the Court finds 'exceptional circumstances' but the writ involves disputed questions of fact, then the writ petition shall not be entertained, meaning thereby that the writ petition may be entertained only if the Court is satisfied firstly, on the existence of 'exceptional circumstances' and secondly, the writ petition does not involve disputed questions of fact. In Rajasthan SRTC case [(1995) 5 SCC 75: 1995 SCC (L&S) 120: (1995) 31 ATC 110] , the Court observed that the idea has been to ensure that the workmen do not get caught in the labyrinth of civil courts with their layers upon layers of appeals and revisions and the elaborate procedural laws, which the workmen can ill afford. The procedures followed by civil courts would not facilitate a prompt and effective disposal of these disputes. As against this, the courts and tribunals created by the Industrial Disputes Act are not shackled by these procedural laws nor is their award subject to any appeals or revisions. Because of their informality, the workmen and their representatives can themselves prosecute or defend their cases. These forums are empowered to grant such relief as they think just and appropriate. They can even substitute the punishment in many cases. They can make and remake the contracts, settlements, wage structures etc. Their awards are amenable to jurisdiction of the High Court under Article 226 as also to the jurisdiction of this Court under Article 32, but they are extraordinary remedies subject to several self-imposed constraints. It is, therefore, always in the interest of the workmen that disputes concerning them are adjudicated in the forums created by the Act and not in a civil court. That is the entire policy underlying the vast array of enactments concerning workmen. This legislative policy and intendment should necessarily weigh with the courts in interpreting these enactments and the disputes arising under them. The retrenched employees have a statutory remedy to raise an industrial dispute under the Industrial Disputes Act. The petitioners have based their claims on the alleged violation of the provisions of the Industrial Disputes Act. There are no exceptional circumstances for exercise of the writ jurisdiction under Article 226 of the Constitution in these writ petitions. Based on above, the writ petition by the employees against Air Noise Company Pvt. Ltd. is not maintainable. This case is similar to a decided case, PTI Employees Union vs Press Trust Of India Ltd on 18 September, 2020 and also covered by State of Uttar Pradesh v. Uttar Pradesh Rajya Khanij Vikas Nigam Sangharsh Samiti .
Topics: Industrial Disputes Act, 1947
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