IN THE HIGH COURT AT CALCUTTA Constitutional Writ Jurisdiction APPELLATE SIDE Present: The Hon‟ble Justice Shampa Dutt (Paul) WPA 28269 of 2025 Himalaya Wellness Company Vs Kunal Lodh & Anr. with WPA 28272 of 2025 Himalaya Wellness Company Vs Khokan Ghosh & Anr. with WPA 28274 of 2025 Himalaya Wellness Company Vs Arindam Barua & Anr. with WPA 28280 of 2025 Himalaya Wellness Company Vs Mukesh Patra & Anr. For the Petitioner : Mr. Soumya Majumder, ld. Sr. Adv. Mr. S.K. Singh, Mr. Sujit Sharma, Mr. R.K. Dubey, Mr. S.R. Singh. For the respondent No. 1 : Mr. Anindya Lahiri, Mr. Bikash Chakraborty. For the State : Mr. Kaustav Seal, Mr. Saikat Koley. 2 Judgment reserved on : 02.07.2026 Judgment delivered on : 27.07.2026 Shampa Dutt (Paul), J.: 1. The writ application has been preferred challenging awards dated 03.10.2024 passed by the learned Second Industrial Tribunal at Kolkata, in Case No. 18/2021, Case No. 19/2021, Case No. 20/2021 and Case No. 21/2021 and the order dated 18.08.2025 passed in review in these cases by the learned 5th Industrial Tribunal at Kolkata (while in-Charge of 2nd Industrial Tribunal, West Bengal at Kolkata) against the review applications filed by the petitioners. 2. It appears that vide the impugned awards the learned Tribunal declared the termination of the private respondents as illegal and unjustified and further directed their reinstatement as permanent Medical Representative and also directed payment of all back wages. 3. Being aggrieved with the said order, the writ application has been preferred by the respondent/establishment. 4. Mr. Majumder, learned senior counsel appearing for the petitioner submits that the petitioner herein vide its service closure letter dated 12th January, 2021, as part of restructuring the company decided to temporarily reduce its workforce and it was due to such decision of the company, the services of the private respondents herein were terminated on and from 30.01.2021. 5. It is the contention of the petitioner herein that the termination of the private respondents was only for the sole reason to temporarily 3 reduce its workforce and, as such, there being no complaints against the private respondents, no disciplinary proceeding was initiated. 6. It is brought to the notice of this Court that the learned Tribunal in its award at page 4 paragraph 2 held as follows:- “The service closure letter mentions that for the purpose of restructuring of Hospital Strategic Business Unit of the OP company was compelled to temporarily reduce the workforce for development of the OP company. So it means that the petitioner was not permanently or conclusively terminated from his service. On the other hand, he was temporarily terminated from his service for the principle of restructuring followed by the OP company.” 7. It is submitted that the learned Tribunal completely misunderstood the terminology “to temporarily reduce its workforce” with the word “temporarily terminated”. 8. Considering the said fact and on the basis of evidence, the Court directed the reinstatement of the private respondents as a permanent medical representatives. 9. On the other hand, Mr. Lahiri, the learned counsel for the private respondents submits that subsequently some of the persons who had been terminated during the said „temporary reduction‟ of its workforce, were reinstated, but the private respondents in these case were not reinstated and as such, the private respondents also claim the benefit of Section 25H of the Industrial Disputes Act. 4 10. The petitioner‟s case in the writ applications is that the private respondents filed applications under Section 2A (2) of the Industrial Disputes Act, 1947 (hereinafter referred to as the „said Act‟) before the learned Second Industrial Tribunal, West Bengal, at Kolkata, registered as Case No. 20/2021/2A(2) alleging their termination and/or retrenchment to be illegal and that in order to terminate the workmen, the company has taken false plea of restructuring. It was further alleged that the company also did not comply with the provisions of law under the Act for such retrenchment of the workman. 11. On completion of hearing the learned Tribunal by its awards dated 03.10.2024 declared that the orders of termination dated 30.01.2021 issued by the company was illegal and directed for reinstatement with full back wages with consequential benefits with compound interest of 10% per annum. Cost of Rs.3,00,000/- was also imposed upon the petitioner. 12. The petitioner herein has also raised the point of territorial jurisdiction in the present case, in view of the fact that the concerned employee used to work in the capacity of Business Development Officer and his nature of duty was to tour to various states of the company in order to supervise the sale of the products of the company and had been reporting to Bangalore office. 13. The address of the opposite party as mentioned in the cause title i.e. Himalaya Wellness Company C/o. Sinha Coal Storage, Alampur, National Highway 6, near Indian Oil Pump, Howarh-711302 is the company‟s CFA (Carrying and Forwarding Agents) address and not a 5 Himalaya office address. All the employees used to report to the Bangalore office. The CFA address has been set up as a meeting point in order to conduct any meets/conferences with the employees by the managers. As mentioned, the office of Himalaya is Bangalore. All the employees report to the Bangalore office. The appointment letters, termination, promotion, or any other official communication to the employees are from the employees are from the Bangalore Office. It is also evident from the Service Rules Book that is issued to every employee at the time of appointment are aware that the jurisdiction is in Bangalore and the employees are aware that the H.O. is Bangalore. Therefore, the appropriate Government for the purpose of the jurisdiction was State of Karnataka. 14. It is the further case of the petitioners that it was forced to restructure its Zeus strategic Business unit as a part of the business organization by reducing its work force. Hence, the company had to discontinue with the service of some of the employees which includes the applicants as well. But the company had provided adequate compensation to the people working for the organization who had to be terminated due to unforeseen and unfortunate situation. The company had partnered with placement agency to support through this transition period and provided assistance to the terminated employees to find a suitable job opportunity and requested for authority to get in touch with the other employer on behalf of the terminated employees to find a suitable placement in this transition stage. The company has settled all legal dues of the applicants with two months additional pay with 6 the one-month notice. The said amount was duly received by the applicant without demur of any protest. But the learned Tribunal has considered the same as a case of “retrenchment” and “unfair labour practice” which is erroneous and thus liable to be reviewed. 15. It is further stated that while accepting the employment with the petitioners vide letter of appointment the respondent no.1 had accepted clause 9 therein, which provides that in case of any dispute between the parties the same would be referred to sole arbitrator for arbitration to be held at Bangalore, Karnataka. 16. The petitioners have challenged the impugned award on the grounds that:- (i) The 2nd Industrial Tribunal did not have territorial jurisdiction, in view of the fact that clause 9 in the letter of appointment was duly accepted by the respondents. The matter is subject to arbitration to be held in Bangalore, Karnatana. (ii) The learned Tribunal wrongly held that the termination of the respondents was bad and illegal on the ground that the retrenchment benefits were not provided. The tribunal then completely overlooked the fact, that the dues of final settlement was duly accepted by the respondents. (iii) The learned Tribunal also wrongly interfered with the discretion of a company in the matter of closing down some of its units, even if such closer do not amount to closer of business. 7 (iv) The tribunal has traveled beyond the order of reference/issues, framed adjudication and the impugned order was passed without proper application of mind and the same is thus to be set aside. 17. Supplementary affidavit has been filed by the petitioners, enclosing copies of evidence as recorded before the Tribunal. Parties herein have filed their respective written notes along with the judgments relied upon. 18. On filing written notes, Mr. Majumder, argues that the respondent no.1 claiming himself to be a Medical Representative/Sales Promotion Employee within the meaning of the Sales Promotion Employees (Conditions of Service) Act, 1976 had invoked jurisdiction under section 2A(2) of the I.D. Act, 1947 claiming that his termination from service on account of restructurization of ZEUS Strategic Business Unit of the Company was unjustified, and he ought to be absorbed in some other Divisions/Units of the Company and re-employed thereat. 19. The respondent No.1 had rendered service in the Company from April 18, 2012 till January 30, 2021 i.e. for a period of 8.8 years. 20. It is further stated that vide a termination notice dated January 12, 2021, the respondent no.1 was paid compensation of 6 months plus one month's notice pay i.e. for 7 months instead of the mandatory requirement of compensation and notice pay of 6 months in his case under the provisions of section 25F of the I.D. Act, 1947. Even without mentioning retrenchment compensation, if an ex-gratia payment fulfils the requirement of compensation to be paid; then the same is reckoned as sufficient compliance of Section 25F. 8 21. In support of the said contention the petitioner relies upon a judgment reported in 1996 (1) LLN 106 (Cal-DB) GKW Limited -vs- 5th I.T., West Bengal & Ors. 22. Mr. Majumder also relies upon the following judgments in support of his contention:- (i) (2005) 5 SCC 91 (para 18) – Haryana State Cooperative Land Development Bank vs. Neelam; (ii) (2004) 1 SCC 68 (para 9, 10) – Pondichery Khadi and Village Industries Board vs. P. Kulothangan & Anr. 23. It is stated that the respondent refused to take the credited amount of compensation as he wanted to re-employed by the company which reveals that he did not face any financial hardship caused by such termination. 24. The respondent has admitted in evidence that he had received all his dues from the company fully and finally. 25. The respondent no.1 himself applied for gratuity on January 31, 2021 and received the same. 26. It is further argued by Mr. Majumder, that the requirement of sending notice to the authorities of the Government under section 25F(c) of the I.D. Act, 1947 has been held to be a directory provision and hence non- compliance thereof does not invalidate a retrenchment. In any event, this had not been the case of the respondents before the Industrial Tribunal. 27. The decision in the case of Manju Saxena -Vs- Union of India & Anr. reported in (2019) 2 SCC 628 (para 6.9) is also relied upon. Mr. 9 Majumder submits that when the company had closed down the business unit, it had endeavoured to procure employment for all the terminated employees without any discrimination through application to be made to the Placement Agency identified by the Company. In response to the same, the respondents had refused to offer themselves for a possible employment elsewhere, thus exhibiting total reluctance to work, or to mitigate their hardship due to termination from service. 28. It is further stated that the respondents had themselves exhibited their unwillingness to procure employment elsewhere and thus in the matter of awarding relief, their conduct is hit by Explanation to section 73 of the Indian Contract Act. 29. It is further argued that the respondents through their cases as made out before the Learned Tribunal have admitted that the Business Unit was closed. They have not been able to make out any case of discrimination as regards retention of any other employee of the business unit where they were working. Their only case was that they ought to be posted in some other division, where the company had subsequently recruited other persons. 30. It is further stated that Section 25G of the I.D. Act, 1947 will have no manner of application, since all employees of the Division/ Business Unit had been terminated. 31. It is further argued that the justifiability of closure of the Unit has not been challenged, nor could it have been a subject-matter of an adjudicatory process; since the reality of closure can only be referred to the Tribunal at the behest of a trade union or a substantial 10 number of workmen. A closure issue is not an individual dispute referable to a Tribunal, at the instance of an individual workman. 32. In fact, the dispute of closure is pending at the behest of a trade union before an Industrial Tribunal in Case No. VIII-28/2024/10. 33. Regarding the issue of the respondents claiming absorption or posting in some other division of the company, when all employees in the business unit where they had been working have been terminated, is addressed by Mr. Majumder as follows:- (i) It is stated that this closure is not of a premises of the Company. It is a business decision to close a particular type of business in the process of restructurization, the grounds whereof had been explained by the Management Witness in his deposition before the Industrial Tribunal. (ii) Argument on behalf of the Respondents, that they have a right of re-employment in terms of section 25H of the I.D. (West Bengal Amendment) Act, 1947 is mutually inconsistent to their case. Section 25H operates only when a Unit is closed. The said provision only confers a right upon a workman to offer himself for re-employment. The language of section 25H is thus a mere right of workman to offer himself for re-employment, and nothing beyond that. Thus, breach of condition or dispute in relation to Section, 25H is once again not an individual dispute as understood within the meaning of section 2A of the I.D. 11 Act, 1947, which is capable of being raised by an individual workman. A dispute with regard to re- employment has to be necessarily raised by a trade union or substantial number of workmen of the industry. It has not been the case of the Respondent no.1 that on his termination from service, some other workmen had been appointed in his place. In any event, the provision of section 25H cannot apply in this case since the closed Unit is not being reopened or has not been reopened by the company. 34. It is further submitted that the learned Tribunal erroneously held that the respondents were not permanently or conclusively terminated from service. In respect of the findings of the learned Tribunal which records that four persons were appointed by the company in other divisions without offering to the respondent no.1 in those divisions and this has been held to be an Unfair Labour Practice in terms of Section 25T of the I.D. Act, 1947. The Tribunal made a finding of victimization under the Vth Schedule to the Act and awarded compensation of Rs.3 lacs on such account. The Tribunal held that Company should have re-appointed the Respondent no.1 in any of its other divisions. 35. It is thus stated that the said findings are perverse for the following reasons:- 12 (i) The respondents prayed for reinstatement in the said status and not re-appointment and re-employment in some other division. It was thus a relief granted beyond prayer. (ii) The Tribunal had accepted the closure of the business unit at many places in the Award, but contradicted its own finding by holding that the said Unit is still in existence. Conversely, the Tribunal granted the relief of reinstatement in the closed Business Unit "or any other Divisions under the Company". (iii) Unfair Labour Practice under section 25T was not an issue to be adjudicated. The finding to that effect is beyond the terms of reference. (iv) Even if there be a finding of Unfair Labour Practice, the Award of compensation amount of Rs. 3 Lakhs is without any evidence and beyond jurisdiction since Section 25T itself prescribes punishment for that purpose. Industrial Tribunal does not have wherewithal to assess compensation or loss by way of torts or civil damages. 36. Hence, the petitioners have prayed for setting aside of the said award. 37. Written notes have been filed on behalf of the respondents and on filing the said notes, Mr. Lahiri appearing for the respondents has argued that there was no justification to throw the respondents out of employment in the name of restructuring and the Petitioner could have transferred them to any other business unit temporarily till completion of the process of restructuring but the petitioner has simply retrenched the respondents illegally from service and the 13 Petitioner published advertisement for filling up vacancies but did not ask the respondent to join in any such vacant post and the Petitioner did not pay any notice pay and compensation for such retrenchment and the said Zeus Strategic Business Unit has not been legally closed and after 30.01.2021 the respondents never worked in any place for his earning. 38. Mr. Lahiri, further argued that the service closure letter mentions that for the purpose of restructuring of Hospital Strategic Business Unit of the Petitioner was compelled to temporarily reduce the workforce for development of the Petitioner. So it means that the respondent was not permanently or conclusively terminated from his service. On the other hand, he was temporarily terminated from his service for the principle of restructuring followed by the petitioner. So it is clear that though the service closure letter mentions about temporary termination of the respondent from his service, actually the respondent has been terminated forever by the petitioner for the said issue of restructuring. So such type of termination comes under the purview of retrenchment ring, according to Section 2 Clause (oo) of The Industrial Disputes Act, 1947. 39. It is further argued that there has been non-compliance of Section 25(F) of the Industrial Disputes Act. The respondents relies upon the following judgments:- (i) Narottam Chopra Vs. Presiding Officer as reported in 1988(36) 636; 14 (ii) Pramod Jha and Ors. Vs. State of Bihar and Ors. reported in Indian Kanoon in case no. Appeal (Civil 4157) of 2000; (iii) Anoop Sharma Vs. Executive Engineer, Public Health, Division No. 01, Panipath (Haryana) reported in (2010) 5 Supreme Court 497); (iv) Raj Kumar vs. Director of Education and Ors. in Civil Appeal No. 1020 of 2011. 40. It is further argued by Mr. Lahiri that the petitioner after retrenchment of their services of the respondents, appointed some other persons in different divisions of the petitioner and the petitioner did not given any offer to the petitioner to join in those divisions of the petitioner after his termination. 41. It is further submitted that the petitioner after retrenching the respondents has given appointment to 9(nine) new candidates in its other divisions. The respondent like Zenith Strategic Business Unit, Zeal Pure Herbs Strategic Business Unit & Zandra Strategic Business Unit of the petitioner. Therefore, the conduct of the petitioner invariably goes to show the blatant violation of Section 25H of the Industrial Dispute Act, 1947. 42. Mr. Lahiri further argues that the termination of the respondents is retrenchment as per Section 2(OO) of the Industrial Disputes Act, in view of the fact that the retrenchment turn out to be an “illegal retrenchment” because the conditions precedent to retrenchment of workmen as featured in Section 25F of the Industrial Disputes Act, 15 1947, has been blatantly violated of the petitioner while retrenching the respondent no. 1 from the service. 43. Mr. Lahiri further submits that the impugned award is in accordance with law and requires no interference. 44. The respondents have filed their additional written notes and the learned counsel for the respondents has argued on filing the same, that as the termination letter was served upon the respondents within the State of West Bengal, the Tribunal had territorial jurisdiction. 45. Mr. Lahiri, relies upon the judgment of the Full Bench of Chhattisgarh in Surit Ram vs. State of Chhattisgarh & Anr. reported in 2025 (187) FLR 285, wherein it is submitted that the Full Bench has clearly explained as to the relief to which a terminated employee is entitled:- Relief Parameters Full Back Wages Illegal termination + permanent/long service + no misconduct + prompt challenge + no gainful employment Partial Back Wages Delay in dispute + short tenure + possible gainful employment + financial hardship of employer No Back Wages Long unexplained delay + gainful employment elsewhere + misconduct by workman + bona fide but technically defective termination 46. Regarding the respondents‟ company that compliance of Section 25(f) of the Industrial Disputes Act is directory and not mandatory in nature, he has relied upon the following judgments:- 16 (i) Armed Forces Ex Officers Multi Services Co-operative Society Ltd. vs Rashtriya Mazdoor Sangh (INTUC) reported in 2022 (175) FLR 544; (ii) Jeetubha Khansangji Jadeja vs Kutchh District Panchayat reported in 2022 (175) FLR 625. 47. Jurisdiction Regarding the point of jurisdiction raised by the respondent/company it appears that though the company is Headquarter in Bengaluru, Karnataka, India with primary registered corporate fall with the legal jurisdiction of Karnataka, the petitioners were appointed with their Headquarter at Kolkata. 48. But clause 9 of the appointment letter is as follows:- “Clause 9. Any dispute or differences which may arise between you and the Company shall be subject to the jurisdiction of Bangalore Courts only.” 49. The rules were duly accepted by the petitioner as per clause 10 of the said appointment letter. 50. As such as per the terms and conditions in the appointment letter, the dispute was to be raised within Bangalore, State Karnataka. 51. But the company/respondent had not raised the said issue before the tribunal, which proceeded to decide the case. 52. In the present case, the issue of maintainability does not solely depend on pure questions of law, considering that herein it is on the point of territorial jurisdiction and as the matter was adjudicated by the tribunal on merit, and also the fact that the petitioner‟s on being appointed were 17 posted in the Headquarters of the company at Kolkata, the impugned award is taken up for consideration as to whether the same is subject to review by this Court. 53. Closure By a letter dated 12th January, 2021, the petitioner was served with a service closure letter where in it was stated:- “..........As part of having a sustainable business, we at Himalaya too have been constrained to review our current business model. Under the given circumstances, we are restructuring Zeus, Strategic Business Unit of The Himalaya Drug Company. As part of the restructuring, it has become necessary for the company to temporarily reduce its workforce. In view of this development, your services are no longer required in the Company. Consequently, your services are hereby terminated with effect from closing hours of 30.01.2021. You would be relieved from service with effect from the closing hours of 30.01.2021. To help you through this transition stage, as a special gesture, considering your number of years of service with the Company, we will be paying you 6 months additional pay, as compensation apart from one month notice pay. You are hereby requested to return the Company belongings and submit the 'No Dues Certificate' from reporting manager at the earliest, in order to process your full and final settlement. We want you to know this termination is not a statement about your work for Himalaya. You have been a dedicated, contributing employee for 8.8 years. We will extend career assistance for placement opportunities with potential employers. We have partnered with placement agency to support you through this transition stage and assist you in finding a suitable job opportunity. If you wish us to speak on your behalf to potential employers, please reach us out. It gives us your permission to discuss your employment with potential employers. You will receive separate communication on career assistance program shortly.........” 18 54. Yes, a company can reduce its workforce during restructuring, but it must follow strict legal rules. This type of job cut is often called a reduction in force, downsizing, or retrenchment. Companies do this to cut costs, combine roles, or fix overlapping duties after a merger. 55. It is clear from the language used in the letter that the company informed that it was necessary to “temporarily reduce its workforce”. 56. As such it is clear that the tribunal wrongly interpreted the same to means “that the petitioner was not permanently or conclusively terminated from his service. On the other hand, he was temporarily terminated from his service for the principle of restructuring followed by the OP company.” 57. The term “temporarily terminated” is solely the interpretation of the tribunal, which is clearly erroneous and total wrong interpretation of the phrase “temporarily reduce its workforce”. 58. The term “temporarily terminated” constitutes two words totally contradictory to each other. 1) Temporary-meaning-lasting for a short time. Not permanent. 2) Terminated-meaning-the act of bringing something to an end or the State of being finished. The final end. 59. As such the tribunal putting the words together, has come to an completely erroneous finding. 60. Section 25F of the I.D. Act, lays down:- “25F. Conditions precedent to retrenchment of workmen.- No workman employed in any industry who has 19 been in continuous service for not less than one year under an employer shall be retrenched by that employer until- (a)the workman has been given one month 's notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice;[* * *] (b)the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days 'average pay [for every completed year of continuous service] or any part thereof in excess of six months; and (c)notice in the prescribed manner is served on the appropriate Government [or such authority as may be specified by the appropriate Government by notification in the Official Gazette.]” 61. On being terminated, the respondents were paid compensation and notice pay. 62. As such the provision of Section 25F of the Industrial Dispute Act was duly complied with. The following judgments support the case of the petitioner herein:- i) The Supreme Court in District Red Cross Society vs Babita Arora & Ors. AIR 2007 SC 2879, decided on 14 August, 2007, the Court held:- “8. The question which arises for consideration is whether the respondent is entitled to protection of Section 25F and 25G of the Act if the establishment in which she was working itself has been closed down though certain other wings or units of the appellant District Red Cross Society, Karnal, have not been closed down and are still functioning. Section 25F of the Industrial Disputes Act lays down the conditions precedent to retrenchment of workmen and it reads as under: 25F. Conditions precedent to retrenchment of workmen.- No workman employed in any industry who has been in 20 continuous service for not less than one year under an employer shall be retrenched by that employer until-- (a) the workman has been given one month's notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice: (b) the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days' average pay [for every completed year of continuous service] or any part thereof in excess of six months; and (c) notice in the prescribed manner is served on the appropriate Government [or such authority as may be specified by the appropriate Government by notification in the Official Gazette]. Section 25FFF deals with compensation to workmen in case of closing down of undertakings. The relevant part of Sub-section (1) of Section 25FFF (omitting the proviso) reads as under : 25FFF. Compensation to workmen in case of closing down of undertakings.- (1) Where an undertaking is closed down for any reason whatsoever, every workman who has been in continuous service for not less than one year in that undertaking immediately before such closure shall, subject to the provisions of sub-section (2), be entitled to notice and compensation in accordance with the provisions of section 25F, as if the workman had been retrenched: Provided ............................ Therefore, the legislature has treated closing down of undertakings which automatically result in termination of services of all workmen working therein differently from a retrenchment simplicitor as defined in Section 25F of the Act. In Workmen of the Indian Leaf Tobacco Development Co. Ltd., Guntur v. The Management of Indian Leaf Tobacco Development Co. Ltd., Guntur AIR 1970 SC 860, it was held as under : "No Industrial Tribunal, even in a reference under Section 10(1)(d) can interfere with 21 discretion exercised by a company in the matter of closing down some of its branches or depots. Even if such closure may not amount to closure of business of the Company, the Tribunal has no power to issue orders directing a Company to reopen a closed depot or branch, if the Company, in fact, closes it down and that closure is genuine and real. The closure may be treated as stoppage of part of the activity or business of the Company. Such stoppage of part of a business is an act of management which is entirely in the discretion of the Company carrying on the business. ...................." In Management of Hindustan Steel Ltd. v. The Workmen & Ors. 1973 Labour & Industrial Cases 461, it was held by this Court as under in para 10 of the reports : "10. The word undertaking as used in S.25FFF seems to us to have been used in its ordinary sense connoting thereby any work, enterprise, project or business undertaking. It is not intended to cover the entire industry or business of the employer as was suggested on behalf of the respondents. Even closure or stoppage of a part of the business or activities of the employer would seem in law to be covered by this sub-section. The question has indeed to be decided on the facts of each case. ........................." In workmen of the Straw Board Manufacturing Company Limited v. M/s Straw Board Manufacturing Company Limited (1974) 1 LLJ 499, this Court laid down the test of closure of a unit by observing that the most important aspect in a case relating to closure is whether one unit has such componental relation that the closing of one must lead to the closing of the other or the one cannot reasonably exist without the other. Functional integrity will assume an added significance in the case of closure. 9. It appears that after the aforesaid decisions of the Supreme Court, the legislature by an amendment made in the year 1982 to the Industrial Disputes Act defined the word "closure" by adding Section 2(cc). Section 2(cc) of the Act reads as under : 2(cc). "closure" means the permanent closing down of a place of employment or part thereof. 22 It is, therefore, clear that in order to attract Section 25FFF it is not necessary that the entire establishment of an employer should be closed. If a unit or part of an undertaking which has no functional integrity with other units is closed, it will amount to closure within the meaning of Section 25FFF of the Act. In J.K. Synthetics v. Rajasthan Trade Union Kendra & Ors. (2001) 2 SCC 87, it has been observed that the closure need not be of the entire plant. A closure can also be of a part of the plant. In Maruti Udyog Ltd. v. Ram Lal & Ors. (2005) 2 SCC 638, it was held as under in para 21 of the report : "21. How far and to what extent the provisions of Section 25F of the 1947 Act would apply in case of transfer of undertaking or closure thereof is the question involved in this appeal. A plain reading of the provisions contained in Section 25FF and Section 25FFF of the 1947 Act leaves no manner of doubt that Section 25F thereof is to apply only for the purpose of computation of compensation and for no other. The expression "as if" used in Section 25FF and Section 25FFF of the 1947 Act is of great significance. The said term merely envisages computation of compensation in terms of Section 25F of the 1947 Act and not the other consequences flowing therefrom. Both Section 25FF and Section 25FFF provide for payment of compensation only, in case of transfer or closure of the undertaking. Once a valid transfer or a valid closure comes into effect, the relationship of employer and employee does not survive and ceases to exist. Compensation is required to be paid to the workman as a consequence thereof and for no other purpose." The position in law is, therefore, well settled that if the entire establishment of the employer is not closed down but only a unit or undertaking is closed down which has no functional integrity with other units or undertaking, the provisions of Section 25FFF of the Act will get attracted and the workmen are only entitled to compensation as provided in Section 25FFF of the Act which has to be calculated in accordance with Section 25F of the Act. The Tribunal and also the High Court clearly erred in holding that as other units of the appellant Red Cross Society like Drug De-Addiction-cum-Rehabilitation Centre, Family Planning Centre and Viklang Kendra were 23 functioning, the termination of services of the respondent would amount to retrenchment. The Maternity Hospital was functioning as a distinct entity. It was not receiving any grant from the Government and was being run entirely on charitable basis from donations received from public. Due to financial stringency, the Maternity Hospital had to be closed down. The other three units, viz., Drug De- Addiction- cum-Rehabilitation Centre, Family Planning Centre and Viklang Kendra are receiving grants from government and are functioning as separate entities and the mere fact that they have not been closed down, cannot lead to the inference that the termination of services of the respondent was by way of retrenchment which was illegal on account of non- compliance of the provisions of Section 25F of the Act. 10. In view of the findings recorded above, the respondent would be entitled to compensation only in accordance with Section 25FFF of the Act and the award for reinstatement in service with back wages passed by the Tribunal which was affirmed by the High Court cannot be sustained and must be set aside.” 63. In the present case, the respondents were duly paid compensation in accordance with Section 25FFF of the Act and also one month notice pay/compensation under Section 25F of the Act. 64. In the present case also one unit had admittedly closed down, which has no functional integrity with other units and as such the respondents are entitled to compensation (paid) and not reinstatement as directed by the tribunal. 65. The Andhra Pradesh High Court in G. Ram Babu vs The State of Andhra Pradesh Rep by its Secretary, Labour, Employment, Training & Factories (Labour-II) Department, Secretariat, Hyderabad & Ors., in Writ Petition No. 5020 of 2016, the Court held:- 24 “23. The core issue fell for consideration in the instant lis is, whether the 3rd respondent Corporation is entitled to take shelter under Section 25F and 25G of the Industrial Disputes Act. If the 3rd respondent Corporation, in which the petitioner worked is closed, whether the petitioner is entitled for absorption in other units of the 3rd respondent Corporation situated in far places which are not closed and still functioning. MRK,J 24. In order to answer the above point, it is appropriate to note the relevant section, i.e., Section 25F of the Industrial Disputes Act, 1947, which enunciated specific conditions precedent to retrenchment of workmen, is extracted hereunder:- "......25F. Conditions precedent to retrenchment of workmen.-- 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 that employer until- (a) the workman has been given one month's notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice; 1[*] (b) the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days average pay [for every completed year of continuous service] or any part thereof in excess of six months; and (c) notice in the prescribed manner is served on the appropriate Government [or such authority as may be specified by the appropriate Government by notification in the Official Gazette]......" 25. The above provision governs the conditions precedent to retrenchment of workmen by an employer. The said provision lays down the mandatory requirements that an employer must fulfil before effecting retrenchment, failing which such 25 retrenchment would be deemed illegal and invalid under the law. 26. It is apposite to refer Section 25 FFF relating to the compensation of the workmen in the event of closing down of said MRK,J establishments/undertakings. For the sake of comprehensive view, the relevant portion of Sub- section (1) of Section 25 FFF of the Industrial Disputes Act., is reproduced hereunder:- "......225FFF. Compensation to workmen in case of closing down of undertakings.-(1) Where an undertaking is closed down for any reasonwhatsoever, every workman who has been in continuous service for not less than one year in that undertaking immediately before such closure shall, subject to the provisions of sub-section (2), be entitled to notice and compensation in accordance with the provisions of section 25F, as if the workman had been Provided that where the undertaking is closed down on account of unavoidable circumstances beyond the control of the employer, the compensation to be paid to the workman under clause (b) of section 25F, shall not exceed his average pay for three months. '[Explanation.--An undertaking which is closed down by reason merely of- (i) financial difficulties (including financial losses); or (ii) accumulation of undisposed stocks; or (iii) the expiry of the period of the lease or licence granted to it; or (iv) in case where the undertaking is engaged in mining operations, exhaustion of the minerals in the area in which such operations are carried on, shall not be deemed to be closed down on account of unavoidable circumstances beyond the control of the employer within the meaning of the proviso to this sub-section.] 2[(1A) Notwithstanding anything contained in sub-section (1), where an undertaking engaged in mining operations is closed down by 26 reason merely of exhaustion of the minerals in the area in which such operations are carried on, no workman referred to in that sub-section shall be entitled to any notice or compensation in accordance with the provisions of section 25F, if- (a) the employer provides the workman with alternative employment - with effect from the date of closure at the same remuneration as he was entitled to receive, and on the same terms and conditions of service as were applicable to him, immediately before the closure; MRK,J (b) the service of the workman has not been interrupted by suchalternative employment; and (c) the employer is, under the terms of such alternative employment or otherwise, legally liable to pay to the workman, in the event of his retrenchment, compensation on the basis that his service has been continuous and has not been interrupted by such alternative employment.]......." 27. The legislature by an amendment i.e., Act 46 of 1982 w.e.f. 21.08.1984 has officially defined the term „closure‟ by inserting Section 2(CC) in the year 1982 to the Industrial Disputes Act, 1947. The complete text of Section 2(CC) is reproduced below:- "....2. (cc) 'closure' means the permanent closing down of a place of employment or part thereof;" 28. The above provision crystal clears that if the establishment falls within the ambit of Section 25FFF of the Industrial Disputes Act, 1947, it is not necessary that the entire establishment of the employer be closed; rather, the closure of a unit or part of the undertaking that has functional integrity with other units amounts to closure within the meaning of Section 25FFF of the Industrial Disputes Act. In other words, if the entire establishment is not shut down but only a specific unit or an undertaking is closed, provided, such unit has no operational stability with other units or undertakings, the provisions of Section 25FFF of the „Act‟ come into operation. Thus, in view of peculiar facts and 27 circumstances involved in the instant case, the petitioner is entitled only for compensation as enunciated under Section 25FFF of the Industrial Disputes Act, 1947. MRK,J 29. In this backdrop, it is relevant to note the case of Maruti Udyog Ltd. Vs. Ram Lal 1 , wherein, the Hon‟ble Supreme Court had held as under:- "......21. How far and to what extent the provisions of Section 25-F of the 1947 Act would apply in case of transfer of undertaking or closure thereof is the question involved in this appeal. A plain reading of the provisions contained in Section 25-FF and Section 25-FFF of the 1947 Act leaves no manner of doubt that Section 25-F thereof is to apply only for the purpose of computation of compensation and for no other. The expression 'as if' used in Section 25-FF and Section 25-FFF of the 1947 Act is of great significance. The said term merely envisages computation of compensation in terms of Section 25-F of the 1947 Act and not the other consequences flowing therefrom. Both Section 25-FF and Section 25-FFF provide for payment of compensation only, in case of transfer or closure of the undertaking. Once a valid transfer or a valid closure comes into effect, the relationship of employer and employee does not survive and ceases to exist. Compensation is required to be paid to the workman as a consequence thereof and for no other purpose......" 66. The petitioner/company relies upon the judgment in Guest keen Williams, Ltd. Vs Fifth Industrial Tribunal, West Bengal & Ors., 1996 1 L.L.N. 106, decided on 8th February, 1995, wherein the Calcutta High Court held:- “25. If those 32 employees are workmen within the meaning of the Act, then if their services are terminated amounting to retrenchment within the meaning of S. 25- 28 F of the Act, then they would be entitled to notice or one month's pay in lieu of notice and compensation, on the computation as indicated in S. 25-F of the Act. If their case is taken as retrenchment within the meaning of S. 25-F, then all the mandatory conditions are fulfilled by the management, namely, notice or one month's pay in lieu of notice and the compensation. 26. In the facts of the case we, therefore, hold that on the interpretation of S. 25-F of the Act that before terminating the services of those 32 employees all the mandatory conditions as contemplated by S. 25-F of the Act, were complied with namely, the notice or one month's pay in lieu of notice and the compensation. 27. It appears from the award that the Tribunal by its award held that the retrenchment was invalid as the mandatory conditions were not fulfilled. The Tribunal, however, held that the concerned workmen should not be entitled to reinstatement which would jeopardise the administration of the company, but they should be entitled to back-wages on the terms as indicated in the award. We have set out above, the operative portion of the impugned award. As we have found on interpretation of S. 25-F of the Act and on the facts of the case that the mandatory conditions of S. 25-F of the Act have been complied with by the management and, as such, the termination of services of those 32 workmen amounting retrenchment within the meaning of the Act was valid, the said 32 employees, the respondent workmen in this appeal are not entitled to any further sum as has been directed by the Tribunal by its impugned award. 28. 28. During the pendency of the proceedings, both before the Trial Court as also before this Appeal Court, it has been brought to the notice of the Court that some employees have died in the meantime, some employees had taken employment elsewhere and considering the said fact, the Tribunal had directed the management to pay the back-wages in the manner as indicated in the award. 29. Considering the facts of the case, we direct that whatever payment has been made by the management in terms of the award and also in terms of the interim 29 order passed by the Trial Court from time to time, the company should not realise or recover the amount already paid in terms of the award or in term of the interim order passed by the Appeal Court from time to time. As it appears to us that the retrenchment compensation as contemplated by S. 25-F of the Act, has been paid by the management to the said 32 employees, at the time of termination of their services, may be it is under the description of ex gratia payment, there would be no further entitlement of compensation by those 32 employees or their heirs and legal representatives. The learned trial Judge, however, refused to interfere with the award on the ground that the Writ Court was not sitting in appeal over the findings of the Tribunal by the impugned award, but we feel that since the very decision-making process was made by the Tribunal on the basis of interpretation of S. 25-F of the Act, the Tribunal took some pedantic view not commensurate with the object for which the said S. 25-F of the Act was introduced. We, therefore, feel that some interference is called for and on the reasoning as indicated above, we feel inclined to interfere with the impugned award and set aside the award as we hereby do.” 67. Respondent/workmen rely upon the following judgments:- 1) Anoop Sharma vs Executive Engineer, Public Health Division No. 1, Panipat (Haryana), (2010) 5 SCC 497. 2) Pramod Jha & Ors. Vs State of Bihar & Ors., AIR 2003 SC 1872, decided on 3rd March, 2003. 3) Armed Forces Ex Officers Multi Services Co-operative Society Ltd. Vs Rashtriya Mazdoor Sangh (INTUC), 2022 (175) FLR 544, decided on August 11, 2022. 30 4) Jeetubha Khansangji Jadeja vs Kutchh District Panchayat, 2022 (175) FLR 625, decided on September 23, 2022. 68. The said judgments do not help in the present case, as there is due compliance of the relevant provisions by the petitioner in this case. 69. The judgment in Deepali Gundu Surwase vs Kranti Junior Adhyapak & Ors. in Civil Appeal No. 6767 of 2013 (arising out of SLP (C) No. 6778 of 2012) decided on 12 August, 2013, relates to reinstatement, which again is not applicable in this case as the respondents are not entitled to reinstatement/reemployment in respect of a closure of unit. (District Red Cross Society (Supra) and G. Ram Babu (Supra)). 70. Regarding compliance of Section 25(F)(c) of the act being directory or mandatory, the petitioner relies upon the judgment of the Supreme Court in Manju Saxena vs Union of India & Anr., (2019) 2 SCC 628, decided on December 3, 2018, the wherein Court held:- “6.9. However, no notice was sent to the appropriate Government or authority notified, in compliance with Section 25-F(c) of the ID Act. A three-Judge Bench of this Court in Gurmail Singh v. State of Punjab [Gurmail Singh v. State of Punjab, (1991) 1 SCC 189 : 1991 SCC (L&S) 147] held that the requirement of clause (c) of Section 25-F can be treated only as directory and not mandatory. This was followed in Pramod Jha v. State of Bihar [Pramod Jha v. State of Bihar, (2003) 4 SCC 619 : 2003 SCC (L&S) 545] wherein it was held that compliance with Section 25-F(c) is not mandatory.” 71. The judgment of 2019 shows that the Supreme Court was clearly of the view that the compliance of Section 25F(c) of the Act was only 31 directory and not mandatory as claimed by the respondent/workers. The Court also relied upon judgments of the Court in 1991 and 2003. 72. On the other hand, the respondent/workers, have relied upon the judgment of 2016 in Raj Kumar vs Director of Education & Ors.(Supra) to support their case that the provisions of 25F(c) of the Act was not complied with even though the same is mandatory. 73. The Court in the said judgment of 2016 relied upon a judgment of the year 1963. 74. Thus the judgment in Manju Saxena (Supra) being later in time shall prevail. 75. The documents at page 42, 43-44, show that the respondent/workman applied for gratuity and also received the same. The other document relate to the final settlement calculation cum pre-receipt of the compensation paid to these employees. 76. Documents at page 55-56 are the petitioner‟s letter extending assistance for placement of the respondent/workman, which was refused in this case. 77. Documents at 57 shows that the respondents refused to accept the compensation and dues credited to their accounts by refusing to use the same. 78. As such the petitioner has taken the stand that this itself shows that the respondents did not require any financial assistance and this does not justify back wages. 79. The closure of the unit is admitted. 32 80. Admittedly none of the persons terminated to reduce work force due to closure for restructuring, were reemployed in other units. 81. The recruitment in other units were independently done and had no connection with the unit closed. 82. The respondents do not have any right to be automatically absorbed in other units of the company in such cases (District Red Cross Society (Supra) and G. Ram Babu (Supra)). 83. Regarding the scope of judicial review in writ jurisdiction, the parties have relied upon judgments which lays down the law:- a) In M/s. Bharti Airtel Limited vs A.S. Raghavendra, in Civil Appeal No. 5187 of 2023, decided on 2nd April, 2024, the Supreme Court held:- “26. As regards the power of the High Court to reappraise the facts, it cannot be said that the same is completely impermissible under Articles 226 and 227 of the Constitution. However, there must be a level of infirmity greater than ordinary in a tribunal's order, which is facing judicial scrutiny before the High Court, to justify interference.………………..” b) West Bengal Central School Service Commission and Ors. Vs Abdul Halim & Ors. (2019) 18 SCC 39, Para 29,30,31,32,33. “29. The High Court in exercise of its power to issue writs, directions or orders to any person or authority to correct quasi-judicial or even administrative decisions for enforcement of a fundamental or legal right is obliged to prevent 33 abuse of power and neglect of duty by public authorities. 30. In exercise of its power of judicial review, the Court is to see whether the decision impugned is vitiated by an apparent error of law. The test to determine whether a decision is vitiated by error apparent on the face of the record is whether the error is self-evident on the face of the record or whether the error requires examination or argument to establish it. If an error has to be established by a process of reasoning, on points where there may reasonably be two opinions, it cannot be said to be an error on the face of the record, as held by this Court in Satyanarayan Laxminarayan Hegde v. Millikarjun Bhavanappa Tirumale [Satyanarayan Laxminarayan Hegde v. Millikarjun Bhavanappa Tirumale, AIR 1960 SC 137] . If the provision of a statutory rule is reasonably capable of two or more constructions and one construction has been adopted, the decision would not be open to interference by the writ court. It is only an obvious misinterpretation of a relevant statutory provision, or ignorance or disregard thereof, or a decision founded on reasons which are clearly wrong in law, which can be corrected by the writ court by issuance of writ of certiorari. 31. The sweep of power under Article 226 may be wide enough to quash unreasonable orders. If a decision is so arbitrary and capricious that no reasonable person could have ever arrived at it, the same is liable to be struck down by a writ court. If the decision cannot rationally be supported by the materials on record, the same may be regarded as perverse. 32. However, the power of the Court to examine the reasonableness of an order of the authorities 34 does not enable the Court to look into the sufficiency of the grounds in support of a decision to examine the merits of the decision, sitting as if in appeal over the decision. The test is not what the Court considers reasonable or unreasonable but a decision which the Court thinks that no reasonable person could have taken, which has led to manifest injustice. The writ court does not interfere, because a decision is not perfect. 33. In entertaining and allowing the writ petition, the High Court has lost sight of the limits of its extraordinary power of judicial review and has in fact sat in appeal over the decision of Respondent 2.” c) Satyanarayan Laxminarayan Hegde and Ors. Vs Millikarjun Bhavanappa Tirumale, 1959 SCC OnLine SC10. 84. Thus the impugned award suffers from inherent errors in the findings of the tribunal, as already discussed. Points as summarised are:- a) The tribunal has clearly misinterpreted the term “temporarily reduce it‟s workforce” with the term “temporarily terminated”, more so in the present case, when admittedly the unit which was to be restructured, was closed down permanently. b) In such circumstances, the question of reinstatement/or automatic reemployment in other units/divisions of the company does not arise and thus also there is no question of granting back wages (District Red Cross Society (Supra) and G. Ram Babu (Supra)). 35 c) The provision of Sections 25F, 25FFF and 25F(C) of the Act have been duly complied with. d) The finding of the tribunal as to “unfair labour practice” is also completely without any basis. 85. Thus the impugned award(s) dated 03.10.2024 passed by the 2nd Industrial Tribunal, Kolkata in Case No. 18/2021, Case No. 19/2021, Case No. 20/2021 and Case No. 21/2021 being based on no evidence, wrong interpretation and findings are set aside, being not in accordance with law, and thus an abuse of the process of law. 86. Consequently the order in review dated 18.08.2025, in all the cases herein also are quashed and set aside. 87. WPA 28269 of 2025 with WPA 28272 of 2025 with WPA 28274 of 2025 with WPA 28280 of 2025 are allowed. 88. Applications, if any, connected thereto stand disposed of consequently. 89. Interim order, if any, stands vacated. 90. Photostat certified copy of this Judgment, if applied for, be given to the parties on priority basis upon compliance of all formalities. (Shampa Dutt (Paul), J.)