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D.C.M. Ltd. Vs. Lt. Governor, Delhi and Others - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtDelhi High Court
Decided On
Case NumberC.W.P. No. 2476/88
Judge
Reported in37(1989)DLT425; 1989LabIC1652; (1989)IILLJ250Del; 1989RLR210
Acts Industrial Disputes Act, 1947 - Sections 9(2), 11, 11A, 14, 25-O, 25-O(2) and (8) and 29
AppellantD.C.M. Ltd.
RespondentLt. Governor, Delhi and Others
Cases ReferredNew Delhi and Another v. K. S. Jagannathan and Another
Excerpt:
the case debated on whether it was arbitrary within article 14 of the constitution of india, to levy of fuel adjustment charges under section 283 of the delhi municipal corporation act, 1957, on one class of consumers - it was observed that the consumers of other categories were charged at different rates, on the basis of total consumption - it was specified that the classification of bulk consumers had a valid relation to the object and purpose of the supply and collection of price of electricity sold - in view of the facts, it was ruled that the levy of fuel adjustment charges, on one class of consumers, was not discriminatory - - for the existing units in different zones it is recommended. governor rejecting the petitioner's application dated march 27, 1985 and refusing the.....s.s. chadha, j.1. this petition under article 226 of the constitution of india challenges the decision of the lt. governor, delhi dated october 29, 1988. refusing the petitioners permissions under section 25-o of the industrial disputes act 1947 to close its industrial undertaking delhi cloth mills at bara hindu rao, delhi.2. the petitioners had earlier filed a petition, being c.w.p. 1281/85 ('d.c.m. ltd. v. union of india and others') under article 226 of the constitution of india seeking a writ of certiorari to quash the decisions of the lt. governor, delhi communicated in the letter dated april 16, 1985 rejecting the petitioners application dated march 27, 1985 and refusing the petitioners permission under section 25-o of the industrial disputes act, 1947 (for short called the 'i.d......
Judgment:

S.S. Chadha, J.

1. This petition under Article 226 of the Constitution of India challenges the decision of the Lt. Governor, Delhi dated October 29, 1988. Refusing the petitioners permissions under Section 25-O of the Industrial Disputes Act 1947 to close its industrial undertaking Delhi Cloth Mills at Bara Hindu Rao, Delhi.

2. The petitioners had earlier filed a petition, being C.W.P. 1281/85 ('D.C.M. Ltd. v. Union of India and Others') under Article 226 of the Constitution of India seeking a writ of certiorari to quash the decisions of the Lt. Governor, Delhi communicated in the letter dated April 16, 1985 rejecting the petitioners application dated March 27, 1985 and refusing the petitioners permission under Section 25-O of the Industrial Disputes Act, 1947 (for short called the 'I.D. Act') to close its industrial undertaking Delhi Cloth Mills at Bara Hindu Rao, Delhi (for short called 'the Mill') with effect from July 1985. The further relief claimed was to declare that the provisions of Section 25-O, ID Act, as inserted by Act 46 of 1982 are ultra virus Articles 14 and 19(1)(g) of the Constitution of India.

3. The stand of the petitioners of that petition was that the Mill is located in a non-confirming area and it can no longer continue the industrial activities at the present site and in fact the heavy and large scale industries are not permitted to be located in the Union Territory of Delhi. Apart from it. the contention was that the industrial undertaking per se is economically enviable and unprofitable. The losses suffered by the industrial undertaking of the petitioners over the past years from 1978-79 to 1983-84 were detailed in para 36 of the amended writ petition. The reasons for the alleged recurring heavy losses being suffered by the Mill were detailed in para 37 of the amended writ petition. According to the petitioners, it is not possible to convert the present industrial undertaking into a modern plant at the present site for various reasons, inter alias that the industrial undertaking is located in a non-conforming area, that the building are very old and not designed for the installation of modern equipments and that the cost of renovation and modernization will not be substantially less than the cost of installing a new and modern unit projected about Rs. 50 cores. It was submitted that in view of the recurring loss being suffered, the Mill being located in non-confirming area and other factors the petitioners were compelled to take the decisions to close down the industrial undertaking.

4. A Full Bench of this Court comprising of S. S. Chadha, G. C. Jain and Sunanda Bhandare, JJ. upheld the virus of the provisions of Section 25-O of the ID Act. That Full Bench recalled the provisions of the Delhi Development Authority Act, 1957 (for short called the Act) and the provisions of the Master Plan prepared in accordance with the procedure laid down by the Act by the Delhi Development Authority (for short called the Authority). The Master Plan as prepared by the Authority was approved by the Central Government under Section 9(2) of the Act. It was published in the Gazette of India on September 1, 1962 in compliance with the provisions of Section II of the Act and regulation 2(1) of the Delhi Development Authority (Publication of approval of Plan) Regulations, 1962. It was duly published by affixing copies thereof in the offices of the Authority, M.C.D.N.D.M.C. and Delhi Administration Secretariat. It was also published by advertisement in the local newspapers. The Master Plan thus came into operation from the date of first publication of notice of September 1, 1962. Once a plan has come into force/operation, it cannot be altered or modified except as provided in Section 11A of the Act. The user of land and buildings in contravention of the Plan is prohibited by Section 14 of the Act. Any person using any land or building contrary to the provisions of the Master Plan, after it came into operation, would contrivance the provisions of Section 14 and would be liable to be penalised under Section 29 of the Act.

5. The full Bench also noticed the submission of the respondents that the Central Government, in exercise of its powers under Section 11A of the Act, proposed extensive modifications in the Master Plan and had called for suggestions/objections. The Authority has published a notification dated April 6, 1985 in the Gazette of India Extraordinary in compliance with the requirement of Section 11A(3) of the Act. It says that 'the following extensive modification which the Central Government proposes to make in the Master Plan for Delhi, keeping in view the perspective for Delhi 2001 and new dimensions in the Urban Development are hereby published for public information. Any person having objections or suggestion with respect to the proposed modifications may sent his objection or suggestion in writing to the Secretary, D.D.A...' Then the proposed modification are detailed in notification. We were again taken through the proposed modification and we find there is no proposal at all for change of the land use of D.C.M. site. On the contrary, there is reiteration of the land use of D.C.M. site for flatted factories and residential area and the policies of the Master Plan that the heavy and large scale industries should not be located in the Union Territory of Delhi. At page 81 of the Gazette it is stated that industrial activity in DUA 81 shall be conducted at all following locations in the prescribed use zones as indicated in the land use plan :

'(i) Light-Industry flatted Factories and Service Industry, Jhandewalan, Birla Mills Site on G.T. Road, near Shanker Market, D.C.M., Anand Parbat, Kirti Nagar near Pusa Institute.'

At the same page it is stated that new industrial units in shall be permitted in different use zones as per conditions prescribed in Annexure III-Classification of Industries. For the existing units in different zones it is recommended. '(e) Industrial Units of the type given in Annexure III H are not permitted in Union Territory of Delhi'. Annexure H at pages 132-134 of the Gazette specifies the industries prohibited within Union Territory of Delhi. Under the Hazardous/Noxious Industrial Units is included under sub-head textiles, finishing, bleaching and dying with the characteristic of 'acid water waste'. Under the sub-head Heavy and Large Scale Industries is included the Cotton Textiles (large scale). The proposed modification thus expressly declare that the heavy and large scale industry of Cotton textiles such as of the petitioner is noxious/ hazardous industry not permitted in the Union Territory of Delhi. Regulations framed under Section 57 read with the proviso to Section 14 of the Act were notified on January 18, 1986 and are called Delhi Development Authority (Zoning) Regulations 1986 (for short called 'Regulation'). 'Noxious Industry has has been defined in Regulation 2(K) - means 'such industry which may be dangerous to life, or injurious to health or property caused by fumes, effluent or smoke or by producing or storing inflammable material' Regulation 5 provides for a period of three years to shift noxious industries to a conforming area or to stop the non-conforming use on the expiry of the said period. The extensive modification proposed in the Master Plan for Delhi with perspective 2001 do not contain any proposal for change of land use of the D.C.M. site. On the contrary, there is reiteration of land use of the D.C.M. site for flatted factories and residential area and the policies of the Master Plan that the heavy and large scale industries should not be located in the Union Territory of Delhi. In C.W.P. 268/87 - 'D.C.M. v. D.D.A.' decided by that Full Bench of this court, it was held that there is no proposal at all for the change of the land use of the D.C.M. site. Similarly is the opinion expressed in C.W.P. 1281/85 - 'D.C.M. v. U.O.I', decided on July 22, 1988 by that Full Bench.

6. During the course of hearing of the earlier writ petition, some suggestion were mooted for an out of Court settlement. A Joint application which has set out terms and conditions that had been discussed and all settled between the petitioner and all the unions except one relating to the compensation payable to the workmen on the closure of the Mill, had been filed. That Full Bench, in view of the subsequent events and the settlement arrived at, considered that it would be in the interest of justice, particularly for the management and the workmen who had agreed to the recording of the settlement, to direct the Lt. Governor to exercise the power of suo motu review of its order dated April 15, 1985 refusing to grant permission for the closure of the Mill. This review was directed to be undertaken considering the terms and conditions of the settlement set out in that application and in accordance with law. The Lt. Governor passed the order on May 5, 1988 and did not find it appropriate to accede to the request of the closure of the Mill.

7. That Full Bench in the judgment dated July 22, 1988 quashed the impugned order dated April 15, 1985 communicating the decision of the Lt. Governor rejecting the petitioner's application dated March 27, 1985 and refusing the petitioners permission under Section 25-O of the ID Act to close its undertaking as well as the order in review dated May 5, 1985. That Full Bench directed the Lt. Governor to determine afresh the application of the petitioners for permission to close its undertaking within a period of 60 days in the light of the observations made in that judgment and in accordance with law.

8. The Governor in the impugned order dated October 29, 1988 in the present petition has once again refused permission to the petitioners to close the Mill. It would be apposite to reproduce the main reasons advanced by the petitioners in support of their request for closure of the Mill as noticed in the impugned order :-

'[I] that the present use of the land for running of a large scale heavy textile mill is contrary to the land user stipulated under the Master Plan of Delhi. Further that in view of the provisions of the Regulations dated 18th January 1986 issued by the DDA, the present non-conforming use has got to be stopped by January, 1989 :

[ii] that their textile mill is a heavy, large-scale and noxious industry discharging toxic effluents and causing pollution, and the consent required from the Central Board for Prevention of Water Pollution has been denied; and

[iii] that the undertaking is suffering heavy losses, and the plant and machinery are old and cannot be modernised as the closure of the mill is imminent in view of the provisions of the Master Plan of Delhi.'

9. In addition to the above reasons, the Lt. Governor also noticed that in their representations, the workers had demanded the closure of the Mill and the permission being accorded in terms of the settlement dated July 28, 1987. The further plea advanced by the workman was also noticed that the workers' interest would be better served if the Mill is allowed to close and they are allowed to avail of the benefits of the additional compensation agreed to be paid to them under this settlement.

10. The impugned order of the Lt. Governor does not deal with any of the reasons advance by the petitioners for closure of the Mill in accordance with or in the light of the observations made by that Full Bench in the earlier writ petition. One of the compelling reasons urged in the earlier writ petition by the petitioners to take the decisions to close down the industrial undertaking was that it is located in non-conforming area as prescribed by the Authority under the Master Plan for Delhi and under the Act it cannot any longer continue the industrial activities at the present site and in fact the Heavy and Large scale industries are not permitted to be located in the Union Territory of Delhi. That Full Bench in the case reported as 'D.C.M. Ltd., v. Union of India and Others' 1988[1] DL 55 [full Bench] had dealt with the question in paras 59 to 63 of the report. It had ruled that the Administrator did not express that this correct reason given by the petitioners is not correct or genuine, that if the requirement of the law is that the industrial undertaking is to be closed in the not too distant future, then surely one would expect that aspect would be dealt with and met by the order as to why it cannot be permitted to be closed and that even in the order May 5, 1988 the Lt. Governor did not deal or meet this reason for closure, or how he balanced it with the public interest. The main thrust of the arguments of Shri F. S. Nariman, Sr. Advocate, the learned council for the petitioners, is that in the impugned order, Lt. Governor noticed the main reason advanced by the petitioners that the mandatory provisions of the Master Plan require the Mill to permanently stop its operations at the present site with effect from January 8, 1989, yet he did not meet it at all, and in our view, he is right.

11. That Full Bench held that the petitioners are obliged to stop the heavy and large industry of cotton textile-finishing, bleaching, dyeing which unit is declared as hazardous/noxious industrial unit within a maximum period of three years now prescribed under the Regulations of January 16, 1986. There is nothing to indicate in the impugned order that the Lt. Governor took into account these observations. In our view, there is a total non-application of mind to the relevant and germane consideration of the effect of the master plan read with the provisions of the Act and the statutory regulations which make it obligatory on the petitioners to stop the present non-conforming use definitely by January 18, 1989. In 'Excel Wear v. Union of India' : (1978)IILLJ527SC the attack to the invalidity of old Section 25-O of the ID Act was on the ground, inter alia, that Section 25-O does not require giving of reasons in the order. It was ruled there that 'Section 25-O(2) does not require the giving of reasons' thus 'whimsically and capriciously the authority can refuse permission to close down'. In para 32 of the report, their Lordships came to the conclusion that it 'permits the authority to pass a cryptic, capricious, whimsical and one-sided order'. The procedural safeguard of recording of reasons has now been incorporated in Section 25-O(2) of ID Act by Act 46 of 1982. The reason are now required to be set out and should not only be intelligible which determine the right of the petitioner to close the Mill but should also deal with the substantial points that have been urged. Reasons are required to be recorded in writing for granting or refusing to grant permission for closure. We do no not expect a reasoned judicial decision but the Lt. Governor must indicate how his mind worked and what was his basis to reject the ground of mandatory provisions of the Master Plan requiring the Mill to be permanently closed at the present site with effect from January 18, 1989. When an adjudicating authority is called upon to decide a question and is obliged to record his reasons in writing, but advances no reasons, the necessary inference is that he has no good reasons to advance in 'Padfield v. Minister of Agriculture & Fisheries' 1968 AC 997, it was held that 'if he does not do so, the court may infer that he has no good reasons'. The impugned order is thus capricious and entitled to be struck down on this short ground.

12. Shri Milon Banerjee, Solicitor General of India wanted this Full Bench to reopen the question that there is no compulsion for the petitioners to close down its Mill although this reason is not advanced by the Lt. Governor and cannot be supplemented in these proceedings. The submission is that the Master Plan only contemplates shifting of non-conforming industries to alternative locations and shifting, in common parlance implies re-locating. Our attention is invited to various provisions of the Master plan to contended that the Master Plan of Delhi while dealing with the non-conforming use of industry has clearly provided that of shifting of such industry according to Plan and that is only possible if suitable land for the purpose is available. Reliance is placed on the draft Master Plan containing the proposed modifications in the Master Plan. In the draft modified Master Plan published in June 1987 the cotton textile is no longer a noxious industry and the Mill of the petitioner comes in the category of only a heavy and large scale industry. The submission is that by virtue of Regulation 7, the heavy and large industry has a period of six years. For its closure and not three years. These submissions cannot stand close scrutiny. As noticed earlier, the proposed modifications in the Master Plan were published in the Gazette of India on April 6, 1985. Under the hazardous/noxious industry is included under the sub-head textiles, finishing, bleaching and dyeing with the characteristic of 'acid water waste'. The proposed modifications of 1985 are notified in the Official Gazette of India but no longer exists in the modified draft proposal of June, 1987. There are two reasons why we cannot accept the draft modified Master Plan. It is intended for limited circulation in the Authority and has not been published in the Official Gazette. The draft modified Master Plan would come into force only after it is approved by the Central Government under Section 9(2) of the Act and them published in the Gazette of India in compliance with the provisions of Section 11 of the Act and Regulation 2(1) of the said Regulations. The proposals if any, thereforee, do not have the effect of modification of the existing Master Plan and the Regulations. Secondly, the proposal cannot have the effect of amending or altering the statutory Delhi Development Authority (Zoning) Regulations, 1983, published in the Gazette on January 18, 1986. 'Noxious Industry' as defined in Regulation 2(K) includes the industry which is injurious to health or property caused by fumes, effluent or smoke. Regulation 5 enjoins upon the persons to shift that industry within three years to any conforming area or stop non-conforming use on the expiry of the said period.' The statutory regulations prevail over any proposed amendment in the draft Master Plan. Apart from it, the request of the petitioners for the allotment of alternative land in Delhi for the purposed of shifting the industrial undertaking was turned down by the Delhi Administration vide their letter dated July 15, 1983 on the ground that large and heavy industries are not permitted within the Union Territory of Delhi. The counsel, thereforee, cannot be heard to say that the Master Plan only contemplates shifting of non-conforming industries to alternative sites.

13. Another reason advanced in support of their request for closure of the Mill is that the Mill is discharging Toxic effluents and causing pollution. Material had been placed before the Lt. Governor. Delhi in the representation dated September 15, 1987 that the petitioners had received letters dated August 21/24, 1987 and September 1/9, 1987 from the Central Board of Prevention and Control of Pollution informing the petitioners that its consent to discharge/continue to discharge effluents is refused. The copies of the test reports filed indicated that the effluents from the Mill is highly toxic and would cause pollution as it also contains organic and inorganic elements injurious to the public at large, to the environment and to the plant and animal life including aquatic organisms. The petitioners are required to obtain a consent order from the Central Board of Prevention and Control of Water Pollution under Section 26 of the Waster (Prevention and Control of Pollution) Act, 1974 This consent was earlier granted to the petitioners vide Central Board's letter dated September 30, 1978 but subject to various conditions contained therein. One of the pre-conditions imposed by the Central Boards is the installation of an effluent treatment plant and a separate 'closed conduit system' to provide for collecting industrial process and cooling and domestic effluents. Further terminal manholes are required to be provided at the end of each collecting system for treatment work. It was the case of the petitioners that such conditions imposed by the Central Board could not be fully complied with on account of non-availability of required space at the Mill for the setting up of a secondary treatment plant and also for laying of a new drainage. The Central Board has issued its consent order to the petitioners valid up to May 31, 1987 subject to various conditions stipulated therein including an obligation to set up the secondary treatment plant. The petitioners had advanced the reasons that they are unable to comply with the conditions, that apart from the cost of the plant amounting to Rs. 25 lacs, it will require a minimum area of one acre for installation which is not available. The existing primary treatment plant cannot achieve the standard stipulated and can be achieved only on the installation of a complete separate 'closed conduit system' for carrying the effluents and for installing a secondary treatment plant for the treatment of effluents but this is not possible on account of the non-availability of land.

14. Lt. Governor in the impugned order had noticed that the consent had been denied by the Central Pollution Control Board as the unit is discharging heavy toxic effluents. He is, thereforee, satisfied with the genuineness of this reason. The only comments is that the D.C.M. appears to be using this as a ground for closure rather than making serious efforts to find appropriate solutions in consultations with technical experts. No enquiry is made as to whether any solution is possible or feasible. He has entered into the realm of conjectures. The application of the petitioners for consent for discharge/continuation of discharge is refused by the Central Board with the result that the penal provisions of the said Act are attracted. The continuous discharge of the toxic effluents is against the larger interest of the public. It exposes the general public as also the environment to the hazards of pollution. There is wisdom in the Master Plan that the hazardous and noxious industrial units are not permitted in Delhi. Noxious and hazardous industrial units are required to shift or close and depending upon the pollution and hazardous nature, the Administration is enjoined to force these industrial units to shift within a maximum prescribed period of three years or stop the non-conforming use. The finding of the Lt. Governor that the petitioners appear to be using this as a ground for closure is in complete disregard of the material on the record and large public interest. His decision is also vitiated on this ground.

15. The third main reason advanced by the petitioners is in regard to the heavy losses incurred. In the original application dated March 27, 1985 the petitioner had indicated that Mills had been suffering substantial losses and details of losses suffered had been given therein. Since the filing of the earlier application, the substantial losses suffered by the Mills are detailed in the application dated August 31, 1985. The total loss suffered by the Mills since 1978-79 is given as over Rs. 40.85 crores. In the earlier writ petition, the petitioners' case was that the industrial establishment of the petitioners at Bara Hindu Rao per se is economically enviable and unprofitable and is suffering heavy losses. That question is dealt with in paras 64 to 66 of the said reported case. It was expressed that it was a vital reason advanced for permission for closure that the undertaking is economically not viable and suffering heavy losses and it was queried whether the petitioners should be compelled to go on incurring losses year after year or for what justifiable reasons. The only reason given by the Lt. Governor in the impugned orders is 'that the losses cannot be said to be representative of an irretrievable situation.' It is in complete disregard of the observations of the Court

16. Under section 25-O(2) where an application for closure has been made, the appropriate Government, after making such enquiry as it thinks fit, has to pass the order. It was thus open to the Lt. Governor to make an enquiry into the question of the figures of the losses furnished by the petitioners. The Lt. Governor does not question the losses suffered by the petitioner and proceeds to express his opinion that the losses cannot be said to be representative of an irretrievable situation. It is thereforee, legitimate to draw the inference that the Lt. Governor accepted the figures furnished by the petitioners as to the losses incurred. This is also clear from the words used 'in regard to losses suffered' In Excel Wear's case (supra), their Lordships posed several questions suggestive of answer, inter alia, 'Can they be compelled to go on incurring losses year after year ?' or 'As in the present case, so in many other situations, a situation may arise both on point of view of law and order and the financial aspect that the employer finds it impossible to carry on the business any longer ?' The Lt. Governor may be right in his conjecture that it is not an irretrievable situation and the Mill can become an economical and financially viable unit. But it would depend upon several uncertain factors. There is no possibility for change or amendment in the mandatory provisions of the Master Plan that the Mill is to close and stop its non-conforming use by January, 1989. The Mill is discharging highly toxic and poisonous effluents into the river and further consent of the Central Board may not be forthcoming. The old and obsolete plant and machinery cannot be renovated except at a substantial cost which, according to the petitioners, would not be less than the cost of installing a new and modern unit estimated to cost Rs. 50 crores. Setting up of a modern textile plant at Delhi is rightly not thought of by the petitioners in view of the prohibition to set up a large and heavy industry in the Union Territory of Delhi. thereforee, the hope expressed by the Lt. Governor is wholly illusory

17. The supporting demand of the workers for the closure of the Mill has been negatived on the ground that the benefits under the settlement to the workers are conditional on the redevelopment of the land at Bara Hindu Rao by the management and dependent on clearances and sanctions from various agencies in terms of their own laws, regulations and guidelines. The Lt. Governor is unduly swayed, in our view, by these considerations. The right to close a business is an integral part of the fundamental right to carry on business and is guaranteed under Article 19(1)(g) of the Constitution. Section 25-O has been enacted and puts restrictions and restraints on employers in closure of industrial undertaking. The Lt. Governor does not say that the petitioners have not brought out specific reasons or they are not genuine and adequate entitling them to secure the permission sought for. The Lt. Governor could only decline the permission after balancing it with public interest. Hypothetically. The purported public interest of security of labour could be considered. An overwhelming majority of over 98% of the workmen have opted for the closure of the Mill in the hope of the receipt of adequate compensation. The closure of any industrial undertaking is likely to have adverse impact on the long term interest of the working class and, thereforee, the legislature enacted the provisions of Section 25-O of the ID Act to consider the interest of the workers employed in a large industrial undertaking. The interest of the labour has not to be ignored and it is for this reason that the legislature had provided under Section 25-O(8) the compensation in the event of the closure of an industrial undertaking. Otherwise, in no case, the closure of an industrial undertaking can be allowed as it would always have an impact on the working class.

18. The earlier Full Bench had dealt with this question in paras 67 to 70 of the said reported case. It was observed that there are no doubt conditions contained in the settlement between the management and workmen for securing the requisite approval and sanctions from appropriate statutory authorities. The fact remains that the redevelopment of the site of the Mill is sought strictly in accordance with the provisions of the Master Plan. The proposed land use for flatted factories is admittedly within the purview of the land use prescribed under the Master Plan and has in no way been affected by the proposed modifications of the Master Plan. The Authority has already been directed in C.W.P. 268/86-'D.C.M. v. DDA' to issue the no-objection certificate to the petitioners and there is no stay from the Supreme Court. The Municipal Corporation of Delhi is enjoined to sanction the building plans if they are in accord with the building byelaws or the land use prescribed thereforee, under the Master Plan. There is also no reasonable basis that the clearance may not be forthcoming under the Slum Areas (Improvement and Clearance) Act, 1956. It had to be presumed that the authorities will act reasonably and in accordance with law.

19. Mr. M. K. Ramamurthy, Senior Advocate, who is appearing for the Unions who are party to the settlement, has categorically urged that the workmen were never in favor of the closure of the Mill but because of the Government's adamant attitude in not amending the Master Plan to permit the non-conforming user beyond January, 1989, that the workers are taking a calculated risk to join the prayer for closure on receipt of the compensation under the settlement. Under the settlement, the workers are to receive an amount virtually equivalent to their present wages that they would have received if they had continued in employment for a period of 72 months. This is a reasonable period during which the workmen may obtain alternative employment in the flatted factories which may come up at a future date and which are to be constructed at the present site well within a period of six years. The statutory compensation under Section 25-O(8) of ID Act is to be paid in accordance with law. In the scheme of settlement, the workmen have to be paid for a period of two years after closure an amount equal to interest at 11% which interest amount will be roughly equivalent to the present carry home wages of the workmen. The interest of the labour, in our view, has been safeguarded by filing another settlement before this Full Bench during the hearing. The settlement between the petitioners and the 12 workmen's unions along with annexure I, affidavit of Dr. Vinay Bharat Ram, in support and the affidavits of the office bearers of the workmen's unions in support are taken on the record. The undertakings given by Dr. Vinay Bharat Ram on behalf of the petitioners and by the office-bearers of the 12 workmen's unions on behalf of the workmen are hereby recorded and accepted by the Court.

20. The law is well-settled that if the action or decision is perverse or is such that no reasonable body of persons, properly informed, could come to or has been arrived at by the authority misdirecting itself by adopting a wrong approach, or has been influenced by irrelevant or extraneous matters, the Court would be justified in interfering with the same (see 'Income-tax Commissioner, Bombay v. Mahindra and Mahindra : [1983]144ITR225(SC) ) In Smt. Shalini Soni v. Union of India : 1980CriLJ1487 , it was held that whenever a decision making function is entrusted to the subjective satisfaction of a statutory functionary, there is an implicit obligation to apply his mind to pertinent and proximate matters only, eschewing the irrelevant and the remote. In our view, the Lt. Governor has not genuinely addressed himself to the pertinent question of the mandatory provisions of the Master Plan requiring the Mill to permanently stop its operations from the present site with effect from January, 1989. As to the nuisance of the discharging of toxic effluents and causing pollution by the Mill, the Lt. Governor has adopted an entirely wrong approach. The consent had been denied by the statutory Central Pollution Control Board for discharging toxic effluents. The continued discharge of the toxic effluents is against the larger interest of the public and this relevant factor has been completely lost sight of. The possibility of the Mill becoming a financially and economically viable unit is dependent on so many uncertainties. The interest of the labour has not been ignored by the management because of the golden hand-shake in the settlement between the petitioners and 12 Unions of the Workers. There is no compelling public interest when the workman are satisfied.

21. We share the concern of the Delhi Administration as urged by the Solicitor General for safeguarding the interest of and the welfare of the workman. He has relied upon Gujarat Steel Tubes Ltd v. Its. Mazdoor Sabha (A.I.R.) 1986 S.C. 1986, State of Kerala v. U. S. Roshan, : [1979]2SCR974 . He is right that 'law is not a brooding omnipresence in the sky but an operational art in the society' and the court in the exercise of writ jurisdiction should do substantial justice between the parties. But the established facts do not tilt the balance of public interest in favor of case set up by the Delhi Administration. On the contrary it is fit case for the grant of permission to close the industrial undertaking of the petitioners at Bara Hindu Rao, Delhi (the Mill). The High Court has power to issue a writ of mandamus to direct the public authority to exercise its direction in a particular manner. In Comptroller. And Auditor General of India, Gian Prakash, New Delhi and Another v. K. S. Jagannathan and Another : [1986]2SCR17 , it was held :-

'There is thus no doubt that the High Courts in India exercising their jurisdiction under Article 226 have the power to issue a writ of mandamus or a writ in the nature of mandamus or to pass orders and give necessary directions where the government or a public authority has failed to exercise or has wrongly exercised the discretion conferred upon it by a statute or a rule or a policy decisions of the government or has exercised such discretion mala fide or on irrelevant consideration or by ignoring the relevant consideration and materials or in such a manner as to frustrate the object of conferring such discretion or the policy for implementing which such discretion has been conferred. In all such cases and in any other fit and proper case a High Court can, in the exercise of its jurisdiction under Article 226, issue a writ of mandamus or a writ in a nature of mandamus or pass orders and give directions to compel the performance in a proper and lawful manner of the discretion conferred upon the government or a public authority, and in a proper case, in order to prevent injustice resulting to the concerned parties, the court may itself pass an order or given directions which the government or the public authority should have passed or given had it properly and lawfully exercised its discretion'

22. In the result, the impugned orders of the Lt. Governor, Delhi dated October 29, 1988 are quashed. We direct the Lt. Governor, Delhi to grant permission prayed for forthwith, in any case not later than 7 days from today, to close the Mill. The petitioners shall be bound by the undertaking given to this Court in the scheme of settlement for payment of compensation to the workmen on the term and conditions as set out in the written agreements filed in this Court. It will be open to the parties to approach this Court for directions. On the facts of this case, we leave the parties to bear their own costs.


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