DECISION This joint appeal by nine workmen is directed against a decision of the learned Fourth Labour Court, given on 22nd February, 1981, dismissing their grievance petition, seeking re-instatement in the service of the respondent-Company with back benefits.
2. The facts, which form the background of this appeal, shortly stated or that on 4th June, 1980, some workmen of the respondent-Company made an application to the Joint Director (East Division) alleging that the Management of the respondent-Mills had stopped work in the Mills with effect from 1st June, 1980, had paid off the temporary workers and had stopped supply of electricity and water to the worker's colony and was pressurising the permanent workmen to settle their accounts. All this, according to the complaint of the workmen, was being done as the Management wanted to give the Mills on contract after getting rid of the assisting workmen. On this complaint the Assistant Director called a joint meeting of the Management and the workmen wherein the Management agreed to make payment to aggrieved workmen upto May, 1980, and assured the Assistant Director that the Management had not terminated the services of any workman.
However, on 16th June, 1980 the Joint Director (East Division), received an intimation from the respondent-Company that due to heavy accumulation of yarn, lack of demand for accumulated stocks, adverse market conditions and stringent financial conditions it was found necessary to stop work and accordingly twenty-eight workers have been laid off for a period of 14 days with effect from 9th June, 1980. Subsequently, by a notice, dated 2nd June, 1980, the services of twenty-nine workmen, including the nine appellants herein, were terminated on the grounds of disconnection/stoppage of power supply by the K.E.S.C. On account of non-payment of accumulated arrears of electrical hills, and other factors beyond the control of the management.
Notice of termination of service of the said workmen was published in the Daily 'Amman' on 24th June, 1980 and also individual termination notices were sent to the workmen affected. The appellants challenged the orders of termination of their services through a joint grievance petition filed before the learned Fourth Labour Court on 26th July, 1980. The said application has been dismissed by the learned Fourth Labour Court on the ground that the respondent mills were justified in effecting retrenchment of the workmen, which was necessitated on account of stoppage of power supply by the K.E.S.C.
3. I have heard Ch. Rasheed Ahmed, who appeared for the appellant workmen, and Mr. Mohammad Humayun, who represented the respondents.
4. Before touching upon the merits of the appeals it may be pointed out that although the appeal has been made on behalf of nine workmen, the Memo. Of Appeal has been signed by eight of the appellants and has not been signed by appellant Mahmood, whose name appears at Serial No, 9 of the Memo. Of Appeal. Furthermore, the letter of authority in favour of Ch. Rasheed Ahmed has been signed by only seven of the appellants and has not been signed by appellants Mahmood and Aurangzeb. As such, there is no valid appeal filed on behalf of appellant Mehmood and no representation on behalf of appellant Aumngzeb.
5. It was contended by Ch. Rasheed Ahmed that the closure of the Mills by the respondent- establishment and subsequent termination of service of the appellants was not based on good faith and at any rate was not in accordance with the provisions of Standing Order 11-A. According to the learned counsel, an establishment could be validly closed and the services of the workmen terminated under the said Standing Order only for reasons beyond the control of the Management.
The learned counsel submitted that since-the power supply of the responden-Mtills had been cut off/disconnected by the K. E. S. C. On account of failure of the respondents to pay the electric bills, it could not be pleaded by them that power supply was stopped for reasons beyond their control. On the other hand, Mr. Mohammad Humayun submitted that Standing Order 11-A provides for the closure of an establishment and termination of services of workmen on account of stoppage of power supply. According to the learned counsel the law does not require any specific ground or reason for the stoppage of power supply and hence once it is established that power supply has been stopped, whatever may be the reasons for which such stoppage has occurred, the Management will be entitled to close the mills and terminate the services of the workmen. Since both the learned counsel have relied upon the provisions of Standing Order 11-A of the 1 Sind Industrial and Commercial Employment (Standing Orders) Ordinance, 1968, it would be advantageous, in order to examine their respective contention, to set down the same in extenso. It reads as follows :- "11-A. Closure of establishment. - Notwithstanding anything contained in Standing Order 11, no employer shall terminate the employment of more than fifty per cent of the workmen or close down the whole of the establishment without prior permission of the Labour Court in this behalf except in the event of fire, catastrophe, stoppage of power supply, epidemics or civil commotion.
' Explanation.-'Close down' in this Standing Order includes lay-off of workmen beyond fourteen days where such lay-off results in closure of an establishment but does not include lock-out declared, commented or continued in accordance with the provisions of the Industrial Relations Ordinance, 1969 (XXIII of 1969)."
Although the expression "stoppage of power supply", as used in the aforesaid Standing Order, is not qualified by any words signifying that such stoppage must be for reasons beyond the control of the Management, the above expression cannot be read in isolation and has to be considered in the context in which it is used. It is a cardinal principle of interpretation of Statutes that the words used in a Statute are not to be construed in isolation but in the context in which they are used and according to their association with other words used in the said Statute.
"Words," says Professor H. A. Smith, in his article 'Interpretation in English and Continental Law', published in the November, 1927, issue of the Journal of Comparative Legislation, "are only one form of conduct, and the intention which they convey is necessarily conditioned by the context and circumstances in which they are written and spoken. No word has an absolute meaning for no word can be defined in vacus, or without reference to some context."
It was said by Lord Rornilly, speaking for the Privy Council in the case of The Lion at p. 530 of the report:- "The meaning of particular words in an Act of Parliament, to use the words of Abbot, C. J., in Rex v.
Hall (1822) 1 B. & C. 123, is to be found not so much in a strict etymological propriety of language, nor even in popular use, as in the subject or occasion on which they are used."
6. The expression "stoppage of power supply'', as used in Standing Order 11-A, has thus to be construed and understood in the context in which it occurs and the word "stoppage" has to be understood in association with other words used in the said Standing Order. It will be seen that according to Standing Order 11-A, closure of an establishment and termination of services of the workmen can be effected by the management, without permission of the Labour Court, in cases of
(1) even of fire, (2) catastrophe, (3) stoppage of power supply, (4) epidemics, or (5) civil commotion. It will be seen that all the cases in which an establishment can be rightly closed and the services of the workmen terminated are those when such closure and termination can necessitated for reason beyond the control of the employer. The expression "stoppage of power supply", thus, is to be understood in a limited sense and cannot be made applicable to those cases where there has been stoppage of power supply due to a voluntary act of the Management, such as shutting off the power supply, disconnecting the electricity lines, removing any necessary part or component of the electricity supply lines which results in the disruption of or interruption in the electricity supply, etc.
7. It may also be pointed not that there is a great distinction between stoppage of power supply and disruption in power supply. Disruption would appear to have wider connotation than stoppage which envisages every form of disruption, including disruption by a voluntary act of the management. On the other hand, "stoppage" itself seems to suggest the act of an external agency.
In Ballentin Law Dictionary, the word "stoppage" has been defined as "an obstruction or hindrance to the doing of a particular thing". In the Arden S. S. Co. Ltd. v. Nathwinand Son Lord Dunedin, as Lord President of the Court, while examining the issue whether suspension of operations in the colliery by the owner, constituted "stoppage" as defined in Charter party, observed as follows :- "Stoppage in the ordinary sense implies something that compels the owner of the colliery to suspend his operations, such as a general strike of the men who are working, or a break-down of the machinery, or an inrush of water into the pit. All those things cause stoppage of a colliery, but I do not think a colliery is stopped when simply one or more of its pits are purposely kept idle because enough ships are not available to carry away one class of coal they produce."
8. It next falls to be considered whether the stoppage of power supply to the respondent mills in the instant case was for reasons beyond the control of the respondent. The respondent mills have relied upon two letters from the K.E.S.C. In support of their contention that the stoppage of power supply was on account of their inability to pay the accumulated arrears of electricity charges. The first letter is dated 4th March 1980 and calls upon the respondent mills to pay the instalment of Rs, 72,466.50 within a week, failing which the electricity supply would be disconnected. The second letter is dated 17th June, 1980 and it requires the respondent mills to pay the total electricity charges of Rs, 6,28,460.63 within seven days, failing which the electricity supply would be disconnected. It is the case of the respondent mills that as they were unable to pay this huge1 2 amount of arrears on account of their financial difficulties, the power supply was cut off by the K. E.
S. C. The financial position of the respondent mills can be clearly inferred from two documents produced before the learned Labour Court by the respondent mills. The first is the letter, dated 15th April, 1980 from the Assistant Collector, Central Excise and Land Customs, granting permission to the respondent mills to store yarn in a godown other than the approved E. B. IV Store Room. This permission was granted on the request of respondent-Mills contained in their letter, dated 15th April, 1980 stating that on account of market slump and loss demand of yarn they had huge stocks of accumulated yarn which could not store in the approved store room in the factory. The letter of the Assistant Collector, thus, supports the contention of the respondent mills that there were huge stocks of accumulated yarn in the respondent mills which had not been disposed of. The second document is the letter, dated 4th May, 1980 from the Assistant Vice-President of the United Bank Limited, intimating the respondent establishment that their present LIM liability amounted to Rs, 17,96,218.20, and requiring them to arrange for adjustment of such liability immediately. Thus, on the one hand, the respondent mills were faced with the demand from the Bank to pay up a huge liability exceeding seventeen lacs and on the other hand they ware saddled with huge stocks of accumulated yarn which had no market on account of slump in the market. In the circumstances, the failures on the part of the mills to pay the huge accumulated arrears o electricity charges amounting to over Six lacs was not practicable o possible. I am, therefore, of opinion that the mills financial position was unsound and its failure to pay electricity charges was for reasons beyond C its control. The necessary corollary to this finding is that the stoppage o power supply in the respondent-Mills was due to circumstances beyond the control of the respondents.
9. It was not disputed by Ch. Rasheed Ahmed that a company has a right to effect retrenchment or to close down its establishment if it Is either consistently running into losses or is unable to operate due to lack of funds.
10. The upshot of the above discussion is that I find no merit in this appeal and would, accordingly, concur in the view taken by the learned Labour Court and would dismiss the appeal. L R 2 P C 525 1912 SC 211