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Updated: Mar 5, 2022

Closure- industrial dispute ACT 1947

INTRODUCTION section 2ccof industrial dispute ACT 1947 closure means permanent closing down of the whole place of employment or part there on Closure procedure section 25(o)undertaking

The employer has to obtain permission at least 90 days before the actual closing down of the undertaking from the appropriate government.The Employer shall also give notice as to the closer. Representative of workmen in the prescribed manner.Workman shall be entitled to all the to all benefit from the date of closure

THE GRANT OF PERMISSION Where the permission for closure is deemed to be granted Every workman shall be entitled to receive compensation. Compensation shall be equivalent to 15-day average pay for every completed year of continuous service or any part in excess of 6 months When the employer makes an application for closing down his establishment the government shall make an inquiry to satisfy itself with the reason and circumstances as mentioned in the application While making the inquiry the government shall follow the principle of natural justice While Granting the permission the government sall record the reason for such grant or refusal and a copy of the order shall be communicated to the employer and the workmen.

· Deemed permission · Finality of order · Illegal clouser · Penality section 25(r)

· Case law closuer ( EXCEL WEAR V/s UNION OF INDIA AIR 1979) Excel wear was Registred firm and manufacturing garment for export purpose Located Bombay The compney was under a heavy debt the government refused approvel under section 25O ,25R of industrial dispute ACT 1947 management file writ under Article 32 and challenging the validity of section 25(O) and section 25(R) Containing that these two provision violated ART 19(1)g of the Indian constitution Decision –supreme court that section 25O of the industrial disputes ACT 1947 As whole was unconstitutional and invalid for violation of ART 19(1)g of the constitution Close down the business.

In case the employer is not in to pay even minimum wages to the laborers is unreasonable Closer is permanent Closer is generally for trade reasons Closer is shutting employment and thereby ending bargaining Closer there is no intention on the part of the employer to continue the business



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