Retrenchment law excludes bona fide closure: termination of all workmen on shutdown or takeover is not retrenchment.

Retrenchment under Section 2(oo) and Section 25F of the Industrial Disputes Act, 1947 was construed as applying to discharge of surplus labour in a running or continuing industry, not to termination of all workmen on a real and bona fide closure of business or on takeover of the undertaking. The statutory scheme was treated as proceeding on the basis of an existing industry, so the wide words "for any reason whatsoever" did not extend to a dead industry. Section 25FF was not treated as enlarging the earlier law to cover closure cases. On that construction, retrenchment compensation was not payable on bona fide closure or takeover.

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Issues: Whether termination of all workmen on a real and bona fide closure of business, or on takeover of the undertaking by another employer, amounts to retrenchment within the meaning of Section 2(oo) and Section 25F of the Industrial Disputes Act, 1947.

Analysis: The definition of retrenchment was read in the context of an existing or continuing industry. The wide words "for any reason whatsoever" were held to govern discharge of surplus labour in a running business, not the termination of every workman when the business itself ceases to exist by bona fide closure or takeover. The scheme of the Act, including the provisions relating to lay-off, retrenchment and related safeguards, was treated as proceeding on the footing of a continuing industry. Section 25FF was not accepted as a parliamentary exposition of the earlier law sufficient to enlarge Section 25F so as to cover closure cases. The constitutional challenge was not finally decided because, on the construction adopted, Section 25F did not apply to a dead industry.

Conclusion: Termination of all workmen on bona fide closure or takeover is not retrenchment under Section 2(oo) and Section 25F, and no retrenchment compensation was payable.

Ratio Decidendi: Retrenchment under Section 2(oo) and Section 25F means discharge of surplus labour in a running or continuing industry, and does not include termination of all workmen on a real and bona fide closure of business or similar cessation of the undertaking.

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