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CASE NO.: Appeal (civil)  3202 of 2008

PETITIONER: STATE OF U.P. & ANR.

RESPONDENT: U.P. RAJYA KHANIJ VIKAS NIGAM S.S. & ORS

DATE OF JUDGMENT: 02/05/2008

BENCH: C.K. THAKKER & D.K. JAIN

JUDGMENT: J U D G M E N T REPORTABLE

CIVIL APPEAL NO. 3202 OF 2008 ARISING OUT OF SPECIAL LEAVE PETITION (CIVIL) NO. 20071 OF 2006

C.K. THAKKER, J.

1.              Leave granted. 2.              The present appeal is directed against  the judgment and final order dated July 14,  2006 passed by the High Court of judicature at  Allahabad, (Lucknow Bench) in Writ Petition No.  338 (S/B) of 1997. By the said order, the writ  petition filed by Uttar Pradesh Rajya Khanij  Vikas Nigam Sangharsh Samiti (’Samiti’ for  short) and Others against the U.P. State  Mineral Development Corporation Ltd. and the  State of U.P. was allowed and a writ of  mandamus was issued to the respondents to  absorb the employees of the Corporation in  various organizations of State Government/  Public Sector Undertakings and to pay  compensation in accordance with law. 3.              The case has a chequered history and  it is necessary to highlight it to understand  the controversy raised in the present  proceedings. 4.              On March 23, 1974, U.P. State Mineral  Development Corporation Ltd. (’Corporation’ for  short) was incorporated as a Government Company  under Section 617 of the Companies Act, 1956.  The Corporation was established with a view to  provide acceleration in the field of mining and  other incidental activities. Initially, the  Corporation was floated with authorized share  capital of Rs.20 crores which was subsequently  increased to Rs.60 crores. It was a Government  Company wherein 100% paid up share capital was  by the State.  It was thus completely owned by  the Government. It was under the direct control  and supervision of the State Government. The  Corporation was thus an ’instrumentality’ of  the State. In the beginning, the Corporation  showed profits. Subsequently, however, the  financial status was deteriorated and it

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started incurring losses. The Board of  Directors, therefore, on December 19, 1996  decided to retrench 460 employees. The Board  was required to pay retrenchment compensation  to those employees. Accordingly, a request was  made to the State Government to advance loan of  Rs.5 crores to enable the Corporation to pay  retrenchment compensation to the employees. A  resolution to that effect was also passed by  the Board of Directors. In the resolution,  reasons were indicated which impelled the  Corporation to take a decision to retrench more  than 50% of its staff. There were 838 employees  out of which 744 were regular employees and 94  were on consolidated salary. 5.              Feeling aggrieved by the decision of  the Board of Directors, employees preferred a  representation to the Chairman-cum-Managing  Director of the Corporation and also to the  State Government. In the representation,  grievance was made by them that the proposed  action was illegal and they should not be  retrenched.  It was indicated that financial  position of the Corporation could be improved.  A prayer was also made to absorb employees of  the Corporation in other Departments of the  State or other Public Sector Undertakings if  they were to be relieved. No final order of  retrenchment was, however, passed. Since  neither the Corporation nor the Government gave  assurance with regard to continuation or  otherwise of the Corporation, nor as to  absorption of employees working in the  Corporation in the State Government or any  other Corporation, the Samiti was constrained  to file a writ petition in the High Court of  Judicature at Allahabad, (Lucknow Bench) in  1997 for the following reliefs;         Whereas, it is most respectfully  prayed that this Hon’ble Court may  kindly be pleased to-

(i)     To issue a writ, order or  direction in the nature of  mandamus directing the  respondent to absorb the  services of the employees of the  Corporation on suitable posts in  any of the Corporation under its  control in any of its  department;

(ii)    To issue a writ, order or  direction in the nature of  mandamus commanding the State of  U.P. to prepare a list of  retrenched employees of the  various Corporations and absorb  them in accordance with length  of their services;

In the alternative, issue a  writ, order or direction in the  nature of mandamus commanding  the State of U.P. and the

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Corporation to pay compensation  at the rate admissible under the  provision of the Industrial  Disputes Act, 1947 and  additional wages at the rate of  six years salary to the member  of the petitioner-Association  who are sought to be retrenched;

(iii)   To issue a writ, order or any  direction which the Hon’ble  Court may deem just and proper  in the circumstances of the  case; and

(iv)    To allow the writ petition with  all costs in favour of the  petitioner.

6.              It was the allegation of the Samiti in  the writ petition that loss has been sustained  by the Corporation because of various wrong  policy decisions taken by the U.P. Government  and the Corporation. Several employees of the  Corporation were not paid their salary and they  were facing great hardship. Their family  members had also suffered a lot and they were  on the verge of starvation. 7.              A counter-affidavit was filed on  behalf of the Corporation through its Managing  Director. By way of preliminary objections, it  was contended that the petition was premature  inasmuch as no action of retrenchment was taken  by the Corporation.  Moreover, alternative and  efficacious remedy under the U.P. Industrial  Disputes Act was available to the petitioners.  On merits, it was contended that in view of  shrinkage in the activities of the Corporation  and also increase of wage bill because of huge  surplus manpower, the Board of Directors of the  Corporation took a decision on December 19,  1996 to retrench excess employees in accordance  with law. According to the deponent, the  Corporation was in acute financial crisis and  totally dependant on grant-in-aid from the U.P.  Government.  The Corporation had closed down  its mining activities in Lambidhar Mines at  Mussorie as per the direction issued by the  Supreme Court (this Court). Even at other  places, it had to face competition from private  sector. Because of drastic change in global  industrialization and liberalized economic  policy introduced by the Government, non- resident Indians (NRIs) were attracted and  several industrial entrepreneurs in the State  entered into the business of mining. Various  projects had been developed in joint sector as  well as in private sector which had also  adversely affected the Corporation. The  Corporation was not able to pay salary to its  employees in its various Units at Dehradun,  Chopan, Allahabad, Lalitpur etc. It was stated  that an Undertaking cannot be forced to run its  business on continuous loss and be directed to  carry on huge surplus manpower and work force

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without work. It was, therefore, submitted that  the writ petition filed by the Samiti was  liable to be dismissed. 8.              It is clear from the record that  several interim orders were passed by the High  Court from time to time and the Corporation was  directed to pay salary to the employees. The  matter was then placed for hearing which came  up before a Division Bench of the High Court.  The Bench consisted of two Hon’ble Judges, viz.  Hon’ble Mr. Justice M. Katju (as His Lordship  then was) and Hon’ble Mr. Justice U.K. Dhaon.  Hon’ble Mr. Justice Katju, vide an order dated  December 17, 1999 held that the petitioners  should have availed of alternative remedy  available under the Industrial Law and should  not have straightaway filed a writ petition in  the High Court under Article 226 of the  Constitution. According to His Lordship, if an  industry was closed down, a remedy available to  the workers was to apply for closure  compensation under Section 25 FFF of the  Industrial Disputes Act, 1947 (hereinafter  referred to as ’the Act’) before the Labour  Court/Tribunal. If it was not closed down,  their remedy was to apply to the prescribed  authority under the Payment of Wages Act or to  a Labour Court/Tribunal under Section 33C(2) of  the Act or under Section 6H(2) of the U.P.  Industrial Disputes Act. But, it was not proper  for the High Court to entertain such prayer in  a writ jurisdiction under Article 226 of the  Constitution. It was also observed that in  spite of the fact that virtually the  Corporation had stopped its activities and the  business had come to an end, by several interim  orders passed from time to time, the High Court  directed the Corporation and the State to pay  salary to the workmen though they had not  worked. By such interim orders, crores of  rupees had been paid to the workmen.  Highlighting the difficulties of the Government  and Public Sector Undertakings in commercial  establishments, His Lordship made larger and  wider observations as to the policy of the  Government in commercial matters.  His Lordship  recommended the Central and State Governments  to rapidly privatize most of the public sectors  and services like banks, telephone,  electricity, water works, municipal services,  etc.  We, however, express no opinion on that  issue.   9.              As regards, the appellant-Corporation,  His Lordship said that it was a ’totally sick’  unit. On the prayers of the Samiti, it was  observed that the workers had been treated  over-indulgently. Most of them had been without  work and were surplus and crores of rupees had  been paid to them for doing nothing. The money  had come from public purse and it was unfair to  grant relief in such a petition. Accordingly,  the petition was ordered to be dismissed. 10.             The other Judge (Hon’ble Mr. Justice  U.K. Dhaon), however, did not concur with the  view expressed by Hon’ble Mr. Justice Katju.

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According to His Lordship, the petitioners  approached the Court by invoking Article 226 of  the Constitution on April 10, 1997. Notice was  issued by the Court on the petition on the next  day i.e. on April 11, 1997 and several interim  orders were passed thereafter from time to  time. It would not be proper to dismiss the  petition on the ground of availability of  alternative remedy after the writ-petition was  entertained, observed Hon’ble Mr. Justice  Dhaon.  His Lordship stated that the  Corporation had considered the problem and in  the counter-affidavit, it was said that  attempts had been made to absorb employees of  the Corporation either in the Government or in  other Public Sector Undertakings. It was  further observed that several interim orders  which were passed by the Court came to be  challenged by the Corporation in this Court and  this Court also did not interfere with those  orders. It was, therefore, not a fit case to  dismiss the petition.  11.             Moreover, as held by the High Court of  Allahabad in Suresh Chandra Tewari v. District  Supply Officer, AIR 1992 All 331, a petition  cannot be dismissed on the ground of  alternative remedy if the same had been  entertained and interim order had been passed.  Relying on another decision of the same Court  in Methodist Church in India v. Bareilly  Development Authority, AIR 1988 All 151, it was  indicated that alternative remedy does not oust  the jurisdiction of the High Court to grant  relief under Article 226 of the Constitution  and in spite of availability of such remedy, it  is open to a High Court to grant relief if      it is found necessary for promotion of    justice or prevention of injustice which is the  object of constitutional provision. Reliance  was also placed on a decision of this Court in  Whirlpool Corporation v. Registrar of  Trademarks, AIR 1999 SC 22 that alternative  remedy is no bar in case of infringement of  fundamental rights enshrined in Part III of the  Constitution. 12.             Hon’ble Mr. Justice Dhaon then  considered the merits of the case and possible  absorption of employees of the Corporation in  Government Departments or Public Sector  Undertakings. Various meetings were held for  the said purpose and assurance was given to the  Court by the Corporation as also on behalf of  the Government.  His Lordship, in the  circumstances was of the view that the writ  petition was required to be allowed. The  petition was accordingly allowed and a writ in  the nature of mandamus was issued directing the  respondents to pay salary to the employees  within four months from the date of the order  and also to take necessary steps for their  absorption in various organizations of the  State Government/Public Sector Undertakings  expeditiously. Liberty, however, was granted to  the respondents to take appropriate steps for  the retrenchment of the employees keeping in

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view the resolution passed by the Corporation. 13.             In view of difference of opinion  between two Hon’ble Judges of the Division  Bench, an order was passed on the same day,  signed by both the Hon’ble Judges to place the  papers before the Hon’ble Chief Justice for  constituting an appropriate Bench. 14.             It appears that in view of cleavage of  opinion, the matter was placed before a third  Judge (Hon’ble Mr. Justice S.H.A. Raza), who  after hearing the parties and considering  opinions of two judges, held that he was in  agreement with the view expressed by Hon’ble  Mr. Justice Dhaon. His Lordship, however,  observed that the State Government had stated  that the employees of the Corporation would be  absorbed and as such nothing remained to be  decided except that the State Government should  expedite their absorption in the State service  or Public Sector Undertakings on suitable post  within a period of three months from the date  of receipt of a certified copy of the order.  15.             His Lordship then stated;  "List the petition before the  Division Bench for appropriate  orders".   16.             The above order was passed on January  5, 2001. 17.             In view of the above direction, it was  incumbent on the Registry to place the matter  before a Division Bench. It was, however, not  done. 18.             Meanwhile, a Review Petition No. 70  s/s of 2001 was filed by the State Government  highlighting difficulties in the process of  absorption.  It was, therefore, prayed to  review the order, dated January 5, 2001.  19.             When the review was placed before  Hon’ble Mr. Justice Raza, it was dismissed by  the Court observing that the learned Additional  Chief Standing Counsel pressed only one point  in the review petition that the direction of  the Court to absorb employees of the  Corporation be extended so that the majority  judgment of the Court could be implemented by  the State Government. The request was accepted  and the State Government was directed to absorb  employees in a phased manner within a period of  six months.  20.             The Court then stated; "As the State Government itself has  derived a policy of absorption, the  matter need not put up before the  Division Bench".

21.             Review petition was thus disposed of  on July 13, 2001. In view of the above  observations, the matter was not placed before  a Division Bench and no order was passed by the  Bench.  Contempt proceedings were also  initiated by the employees that the orders  passed by the Court were not obeyed and not  implemented.  22.             On March 19, 2005, the appellants

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moved an application before the Senior Judge of  the High Court (Lucknow Bench) for listing the  writ petition before an appropriate Bench for  final disposal; since there was no final  decision on the writ petition except opinions  of three Hon’ble Judges.  The application moved  by the Corporation was registered as Civil  Miscellaneous Application No. 12153 of 2005.   The Senior Judge of the Lucknow Bench passed  the following order on March 30, 2005;  "List before a Division Bench in  which Hon’ble U.K. Dhaon is a  member in next week."

23.             The matter was then placed before a  Division Bench (Coram : U.K. Dhaon & J.M.  Paliwal, JJ.)  The Corporation on May 9, 2005,  filed supplementary counter-affidavit placing  on record inter alia the following facts and  materials; (i)     Absorption Rules, 1991; (ii)    Policy of the State Government  regarding absorption of employees,  dated July 10, 2000; (iii)   Application for modification of  undertaking of Harminder Raj Singh  recorded in the order dated August  4, 1999; (iv)    Absorption Rules, 2003. 24.             On July 19, 2005, the Division Bench  of the High Court, instead of deciding the writ  petition decided the application, dated March  10, 2005 (which was for listing of the matter  before a Division Bench).  It was observed that  the matter was heard and finally decided by the  Hon’ble Third Judge in accordance with Rule 3  of Chapter VIII of the Allahabad High Court  Rules, 1952 and, hence, no further order was  required to be passed.  The application was,  therefore, rejected. 25.             The High Court was obviously in error  in passing the above order.  The State and the  Corporation, therefore, filed Special Leave  Petition in this Court which was registered as  Civil Appeal No. 5473 of 2005. It was contended  before this Court that after difference of  opinion between two Hon’ble Judges, the matter  was placed before a third Judge who decided it  and directed to place it before a Division  Bench which ought to have been done and the  case ought to have been placed before a  Division Bench. Even if Review was rejected  against the order passed by the third Judge,  proper procedure was required to be followed  which was not done.  The Senior Judge (Lucknow  Bench) also ordered to place the matter before  a Division Bench.  The order passed by the  Single Judge, therefore, could not be said to  be legal and lawful.  26.             This Court referred to the  relevant rules and upheld the contention of the  State and observed that the matter ought to  have been placed before a Division Bench. On  September 2, 2005, a two Judge Bench of this  Court to which one of us (C.K. Thakker, J.) was

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a party, inter alia, passed the following  order: "In the aforesaid circumstances, we  set aside the impugned judgment and  direct that Writ Petition No. 338  (S/B) of 1997 shall be listed before  appropriate Bench for orders in  accordance with law, considering the  orders passed by two learned Single  Judges on 17th December, 1999  disagreeing with each other and also  the opinion of the learned third Judge  in the matter, dated 5th January, 2001.  The Division Bench will decide the  matter expeditiously, without being  influenced by any observations made by  this Court and in accordance with law,  preferably within a period of three  months."

27.             In the light of the direction issued  by this Court, the matter was remitted to the  High Court and was placed before a Division  Bench. The Division Bench of the High Court  allowed the writ petition filed by the  petitioners and issued the following direction; "On a thoughtful consideration of the  matter, we are also of the view that  when the matter was referred to  Hon’ble Third Judge and he recorded  his opinion and issued a specific  direction to the office that the  matter be placed before the Division  Bench of appropriate orders, it was  duty of the office to have placed the  matter before the Division Bench for  suitable orders. The application dated  09/13.05.2005 moved by the State of  U.P. for taking on record the  supplementary counter-affidavit  pointing out difficulties in  absorption of the employees of the  corporation, is not maintainable. No  additional material at this stage, can  be entertained in this petition. The  application is, therefore, rejected.  The writ petition is finally disposed  of in the following terms;

The writ petition is allowed and a  writ of mandamus is issued directing  the opposite parties to absorb the  employees of the petitioners- association within four months from  today in various organizations of the  State Government/Public Sectors and to  pay compensation, in accordance with  law. However, it will be open for the  opposite parties to take necessary  steps for the retrenchment of the  employees of the petitioners- association keeping in view the  resolution dated 19.12.1996 of the  Board of Directors of the Corporation.  Parties shall bear their own costs."

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                               (emphasis supplied)

28.             It is this order which is challenged  by the appellants in the present appeal. 29.             Notice was issued on December 11,  2006. The respondents appeared, accepted the  notice and prayed time to file counter  affidavit. Meanwhile, operation of the judgment  was stayed. The Registry was thereafter asked  to place the matter for final hearing on a non- miscellaneous day and that is how the matter  has come up before us. 30.             We have heard learned counsel for the  parties. 31.             The learned counsel for the appellants  contended that the High Court was wholly wrong  in entertaining a petition under Article 226 of  the Constitution and in not relegating the writ  petitioners to avail of alternative remedy  available under the Industrial Law. It was also  submitted that disputed questions of fact were  involved in the petition which could not be  appropriately dealt with and decided in  exercise of extraordinary jurisdiction by a  writ court and on that ground also the Court  ought to have directed the writ petitioners to  approach an appropriate forum.  Moreover, no  action of retrenchment of employees had been  taken and, as such, the writ petition was  premature and not maintainable.   32.             On merits, it was submitted that it is  settled law that creation, continuation and  abolition of post is a ’sovereign function’ and  such a decision cannot be interfered with by a  court of law in exercise of power of judicial  review on limited parameters unless it is  contrary to law, inconsistent with the  provisions of the Constitution or mala fide. It  has been clearly stated in the affidavit in  reply by the Corporation that the activities of  the Corporation were virtually stopped and ’no- work’ resulted in taking a decision to close  down the Corporation. It was urged that apart  from earning profits, the Corporation had  incurred huge losses. There were financial  problems and economic difficulties. There was  excess of manpower and hence a policy decision  was taken to retrench surplus employees. Such a  decision cannot be made subject matter of  ’judicial review’ when no provision of law had  been violated. The counsel contended that even  if there was violation of some provision of law  and legitimate dues of employees were not paid  or they were deprived of other benefits, such  questions could have been agitated before an  appropriate forum under appropriate law and not  by a writ Court. So far as absorption of  employees of the Corporation is concerned, an  action can be taken by a Corporation which is  an instrumentality of State within the meaning  of Article 12 of the Constitution as also by  the State of U.P. only in accordance with  statutory rules framed by the State in exercise  of power under proviso to Article 309 of the  Constitution, viz. Uttar Pradesh Absorption of

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Retrenched Employees of Government or Public  Corporations in Government Service Rules, 1991,  as amended from time to time. A public  authority cannot act inconsistent with or  contrary to statutory rules. It was stated that  no statement was made by any officer on behalf  of the Corporation that the employees of the  Corporation would be absorbed by the Government  either in Government service or in any Public  Sector Undertaking. But, even if some statement  was made, it had no legal force and binding  effect and cannot be enforced inasmuch as no  statement could have been made which is not in  consonance with law or against statutory rules.  In the instant case, an application was also  made by the Secretary of the Corporation  stating therein that no assurance was given by  him to the Court that the retrenched employees  would be absorbed nor such assurance could be  given by any one else.  But the High Court,  unfortunately, rejected the said application  and proceeded to decide the matter on so-called  assurance. According to the learned counsel,  there can be no estoppel against a statute. If  the relevant provisions of law do not entitle  an employee after retrenchment to be absorbed  in any other Department or Undertaking, no such  right can flow from a statement, assurance or  even undertaking if it is not in consonance  with law. It was submitted that the Court ought  to have appreciated the fact that no employer  can be compelled by a Court of Law to continue  its business in losses and if the employer  decides to close down its Undertaking, it has  right to do so subject of course to law in  force. If there is violation of any provision  of law, appropriate authority can always pass  an appropriate order but a writ Court cannot  direct the employer to continue the employees  in service, to pay salary to them nor it can  order the State Government to absorb excess  employees of such Corporation either in  Government or any other Public Sector  Undertaking. The counsel also made grievance  against the direction to the Corporation to pay  ’compensation’. On all these grounds, it was  submitted that the appeal deserves to be  allowed by setting aside the order passed by  the High Court. 33.             The learned counsel for the Samiti and  the employees, on the other hand, supported the  final order passed by the High Court. It was  submitted that one of the Judges of the  Division Bench was clearly in error in  dismissing the petition on the ground of  availability of alternative remedy. The other  Judge was right in observing that an  alternative remedy is not an ’absolute’ bar to  a writ remedy under Article 226 of the  Constitution particularly when it relates to  enforcement of fundamental rights guaranteed by  Part III of the Constitution. Moreover, the  writ petition had already been entertained,  several orders were passed from time to time  and as held in several decisions, once a

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petition is entertained, it cannot be dismissed  on the ground of availability of alternative  remedy and must be decided on merits. That was  done by the other Judge and that part of the  decision could not be said to be contrary to  law.  34.             On merits, it was submitted that the  High Court was right in granting relief to the  employees. The Corporation was established in  1974, employees were working since many years  and keeping in view the facts and circumstances  in their entirety, the High Court directed the  State Government to absorb them in the  Government Departments or other Public Sector  Undertakings and such a decision cannot be said  to be contrary to law. On behalf of the  Corporation, an assurance was given that the  employees would be absorbed. The Court was  requested to grant time for the said purpose  which has been done. No fault can be found  against such an action and the grievance raised  by the Corporation is not well-founded. The  Court, considering all the facts and  circumstances, issued certain directions which  are in consonance with law. It was also stated  that several interim orders which were passed  by the Court from time to time were confirmed  even by this Court. It was only because the  matter was not placed before a Division Bench  of the High Court and the earlier order was not  complied with that this Court allowed the  appeal filed by the State and remitted the  matter to the High Court to be dealt with and  decided by a Division Bench.  But once the  Division Bench has decided the matter and  passed an order, no interference is called for.   It was also submitted that the Government has  absorbed several employees by adopting ’pick  and choose’ method which shows that it wants to  oblige ’fortunate few’ without any legal basis  or principle.  It was further stated that it is  not true that the Corporation has closed its  activities and mining work.  It is working and  several persons are still in service performing  their functions and discharging their duties.   For all these reasons, the appeal deserves to  be dismissed. 35.             We have given most anxious and  thoughtful consideration to the rival  contentions of the parties. So far as  preliminary objection raised by the Corporation  before the High Court is concerned, in our  considered view, the same was well-founded and  ought to have been upheld. It was urged before  the High Court on behalf of the Corporation and  the State Government that the writ petition was  premature inasmuch as no retrenchment had been  effected. Several disputed questions of fact  were involved in the petition. If the  contention of the Samiti was that there was  illegal closure of Undertaking or there was  non-payment of wages by the employer,  appropriate proceedings could have been  initiated under Industrial Law. In fact, one of  the Judges of the Division Bench upheld the

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contention and observed that the employees  could have claimed closure compensation under  Section 25 FFF of the Act or could have  approached prescribed authority under the  Payment of wages Act relying upon Section  33C(2) of the Act or Section 6H(2) of the U.P.  Industrial Disputes Act. The other Single Judge  of the Division Bench, however, held that the  writ petition had been entertained and interim  orders were also passed. Relying upon Suresh  Chandra Tewari, the learned Judge held that  "the petition cannot be dismissed on the ground  of alternative remedy if the same has been  entertained and interim order has been passed".  (emphasis supplied). 36.             With respect to the learned Judge, it  is neither the legal position nor such a  proposition has been laid down in Suresh  Chandra Tewari that once a petition is  admitted, it cannot be dismissed on the ground  of alternative remedy. It is no doubt correct  that in the ’head note’ of All India Reporter  (AIR), it is stated that "petition cannot be  rejected on the ground of availability of  alternative remedy of filing appeal".  But it  has not been so held in the actual decision of  the Court.  37.             The relevant paragraph 2 of the  decision reads thus: "2. At the time of hearing of this  petition a threshold question, as to  its maintainability was raised on the  ground that the impugned order was an  appealable one and, therefore, before  approaching this Court the petitioner  should have approached the appellate  authority. Though there is much  substance in the above contention, we  do not feel inclined to reject this  petition on the ground of alternative  remedy having regard to the fact that  the petition has been entertained and  an interim order passed".                                                        (emphasis supplied) 38.             Even otherwise, the learned Judge was  not right in law.  True it is that issuance of  rule nisi or passing of interim orders is a  relevant consideration for not dismissing a  petition if it appears to the High Court that  the matter could be decided by a writ-Court. It  has been so held even by this Court in several  cases that even if alternative remedy is  available, it cannot be held that a writ- petition is not maintainable. In our judgment,  however, it cannot be laid down as a  proposition of law that once a petition is  admitted, it could never be dismissed on the  ground of alternative remedy. If such bald  contention is upheld, even this Court cannot  order dismissal of a writ petition which ought  not to have been entertained by the High Court  under Article 226 of the Constitution in view  of availability of alternative and equally  efficacious remedy to the aggrieved party, once  the High Court has entertained a writ-petition

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albeit wrongly and granted the relief to the  petitioner. 39.             On the facts and in the circumstances  of the case, particularly in view of assertions  by the Corporation that its work had been  substantially reduced; it was running into  losses; the question was considered by the  Board of Directors and it was resolved to  retrench certain employees, it would have been  appropriate, had the High Court not entertained  the writ petition under Article 226 of the  Constitution. [See also Scooters India v. Vijai  E. V. Eldred, (1998) 6 SCC 549] 40.             The matter, however, did not rest on  averments and counter-averments. The record  reveals that the Corporation was convinced that  retrenchment of certain employees was  absolutely necessary. According to the  Corporation, because of globalization and entry  of private sector in the business and also  because of various orders passed by this Court  from time to time in Public Interest Litigation  (PIL), the activities of the Corporation had  been considerably curtailed. It was incurring  losses and was not able to pay salaries and  wages to its employees. It was, therefore,  decided to take recourse to retrenchment in  accordance with law.  41.             Now, whether such action could or  could not have been taken or whether the action  was or was not in consonance with law could be  decided on the basis of evidence to be adduced  by the parties. Normally, when such disputed  questions of fact come up for consideration and  are required to be answered, appropriate forum  would not be a writ court but a Labour Court or  an Industrial Tribunal which has jurisdiction  to go into the controversy. On the basis of  evidence led by the parties, the Court/Tribunal  would record a finding of fact and reach an  appropriate conclusion. Even on that ground,  therefore, the High Court was not justified in  allowing the petition and in granting relief. 42.             There is yet one more reason. In the  High Court, the Corporation filed an  application stating therein that regarding  absorption of employees, statutory rules had  been framed by the State Government in exercise  of power under the proviso to Article 309 of  the Constitution. A prayer was, therefore, made  to allow the application to bring statutory  rules on record and to consider them. The  Court, however, rejected the prayer.  In our  opinion, the High Court was not right in  rejecting such prayer. If there were statutory  rules and such rules provide for absorption of  employees on certain grounds and on fulfillment  of some conditions laid down in those rules, it  was the duty of the High Court to consider  those rules and to decide whether under the  statutory rules, such absorption could be  ordered. 43.             After all, the High Court was  considering the prayer of the petitioners to  grant a writ in the nature of mandamus.  It

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was, therefore, expected of the High Court to  keep in view the relevant provisions of law.   The High Court mainly relied upon an assurance  said to have been given by the Secretary on  behalf of the Corporation that excess employees  would be absorbed either in the Government  Department or in other Public Sector  Undertakings. From the record it appears that  it was the case of the Secretary of the  Corporation that no such assurance was given by  him to the Hon’ble Court.  But even if he had  given such assurance, it was of no consequence  since in the teeth of statutory rules, such  assurance had no legal efficacy. Moreover, an  application was made on affidavit by the  Secretary of the Corporation clarifying the  position and praying for modification of the  earlier order passed by the High Court in which  such statement on behalf of the Corporation  appeared. The High Court, however, rejected  even that application.  In our considered  opinion, even on that ground, the High Court  ought not to have issued final directions.  44.             It is settled law that there can be no  estoppel against a statute. If the field was  occupied by statutory rules, the employees  could get right only under those rules.  The  High Court was equally bound to consider those  rules and to come to the conclusion whether  under the statutory rules, the retrenched  employees were entitled to absorption either in  Government Department or in any other Public  Sector Undertaking. Statement, assurance or  even undertaking of any officer or a counsel of  the respondent-Corporation or of the Government  Pleader of the State is irrelevant. The High  Court, in our view, ought to have considered  the prayer of the Corporation and decided the  question if it wanted to dispose of the matter  on merits in spite of availability of  alternative remedy to the employees. 45.             Again, in our considered opinion, it  was incumbent on the employees to show the  right of absorption of retrenched employees in  Government Department or other Public Sector  Undertakings. The petitioners had prayed for a  writ of mandamus which presupposes a legal  right in favour of the applicant. Such right  must be a subsisting right and enforceable in a  Court of Law. There must be corresponding legal  duty on the part of the respondent-Corporation  or Government which required the Corporation or  Government ’to do that which a statute required  it to do’. No such right of absorption has been  shown by the petitioners. Nor any such  corresponding duty of the respondents could be  shown to the High Court by the employees. As  noted above, the case of the Corporation was  that the retrenched employees could be absorbed  only in accordance with statutory rules framed  under proviso to Article 309 of the  Constitution. No such direction of absorption  of all employees, hence, could be issued by the  High Court. The High Court failed to appreciate  all these relevant considerations. Even the

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application by which the Corporation sought to  place on record statutory rules was rejected by  the Court and a writ of mandamus was issued.  46.             It is well settled that a Court of Law  can direct the Government or an instrumentality  of State by mandamus to act in consonance with  law and not in violation of statutory  provisions. Unless a Court records a finding  that act of absorption of all employees of the  Corporation either in Government Department or  in any other Public Sector Undertaking is in  accordance with law, no writ can be issued.  Therefore, even on that ground, the directions  of the High Court deserve to be set aside. 47.             Regarding payment of compensation to  the employees also, the High Court was not  right. We have extracted the operative part of  the order of the High Court in earlier part of  the judgment.  The High Court has stated that  the appellants herein would absorb the  employees of the Corporation and would "pay  compensation in accordance with law". It was  contended by the Corporation that there was no  foundation in the entire writ petition as to  the provisions of law under which such  compensation could be claimed and violation of  the law by the Corporation or by the State. No  finding has been recorded by the High Court  that a specific or particular provision of law  had been violated which entitled the workers to  claim compensation.  No reasons had been  recorded by the High Court in the impugned  judgment for issuing such direction nor any  basis for such direction has been shown. In our  opinion, therefore, no such blanket direction  could have been issued by the High Court which  was not even capable of implementation.   48.             To us, one of the considerations in  such matters is whether an order passed or  direction issued is susceptible of  implementation and enforcement, and if it is  not implemented whether appropriate proceedings  including proceedings for willful disobedience  of the order of the Court can be initiated  against the opposite party.  The direction  issued by the High Court falls short of this  test and on that ground also, the order is  vulnerable.  49.             It is contended on behalf of the  employees that the Corporation was not right  when it stated that there was no work and  several projects came to be closed. It was also  contended that many employees were absorbed by  the Corporation and there was an element of  ’pick and choose’.  The said action was  arbitrary, discriminatory, unreasonable and  violative of Articles 14, 19 and 21 of the  Constitution. Regarding loss caused to the  Corporation, according to the Samiti, it was  the result of wrong and improper decisions of  the Corporation and the State Government.  Poor  employees should not suffer on that count.  50.             In our considered view, however, all  such actions could be examined by an  appropriate Court/Tribunal under the Industrial

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Law and not by a writ Court exercising power of  judicial review under Article 226 of the  Constitution. If the impugned action of the  Corporation of retrenchment of several  employees is not in consonance with law, the  employees are certainly entitled to relief from  an appropriate authority. If any action is  taken which is arbitrary, unreasonable or  otherwise not in consonance with the provisions  of law, such authority or Court/Tribunal is  bound to consider it and legal and legitimate  relief can always be granted keeping in view  the evidence before it and considering  statutory provisions in vogue. Unfortunately,  the High Court did not consider all these  aspects and issued a writ of mandamus which  should not have been done. Hence, the order  passed and directions issued by the High Court  deserve to be set aside. 51.             For the foregoing reasons, the appeal  deserves to be allowed and the order passed by  the High Court is liable to be set aside and is  accordingly set aside. 52.             Since we are of the view that one of  the Hon’ble Judges of the Division Bench of the  High Court which decided the matter at the  initial stage was right in relegating the  petitioners to avail of alternative remedy  under the Industrial Law and as we hold that  the High Court should not have entertained the  petition and decided the matter on merits, we  clarify that though the writ petition filed by  the petitioners stands dismissed, it is open to  the employees to approach an appropriate  Court/Tribunal in accordance with law and to  raise all contentions available to them. It is  equally open to the Corporation and the State  authorities to defend and support the action  taken by them. As and when such a course is  adopted by the employees, the Court/Tribunal  will decide it strictly in accordance with law  without being influenced by the fact that the  writ petition filed by the writ petitioners is  dismissed by this Court. 53.             The appeal is allowed accordingly.   Considering the facts and circumstances of the  case, however, there shall be no order as to  costs.