Deemed closure under industrial law survives unless the appropriate Government issues a valid reasoned order on the closure application.

Under Section 25-O of the Industrial Disputes Act, a closure application can be defeated only by a lawful written order of the appropriate Government passed after due consideration and reasons; an informal communication that does not decide the request on merits is insufficient and does not prevent deemed permission after sixty days. The Deputy Secretary was not the competent authority, as the statutory power lay with the appropriate Government and the Minister for Labour had to apply mind independently. Internal file notings could not cure the defect, so the application remained undisposed of in law and deemed closure followed.

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Issues: (i) Whether the communication dated 25 September 2019 could be treated as an order under Section 25-O of the Industrial Disputes Act, 1947 so as to prevent deemed permission for closure under Section 25-O(3); (ii) Whether the Deputy Secretary was the competent authority to deal with the closure application and, if not, what was the legal consequence.

Issue (i): Whether the communication dated 25 September 2019 could be treated as an order under Section 25-O of the Industrial Disputes Act, 1947 so as to prevent deemed permission for closure under Section 25-O(3)

Analysis: The statutory scheme requires an employer seeking closure to apply at least ninety days in advance, state reasons, and serve the workmen's representatives. The appropriate Government must then enquire, hear all concerned, and pass a written order recording reasons. If no order is communicated within sixty days, deemed permission follows. The closure application here disclosed that the unit had been manufacturing only for one customer, that the job work contract had been terminated, and that there was no alternative manufacturing avenue. The later correspondence supplied additional particulars about efforts made to obtain other work, which confirmed the application's substance and the commercial impossibility asserted by the employer. The communication of 25 September 2019 did not decide the application on merits in the manner required by the statute and did not constitute a valid order refusing permission.

Conclusion: The communication dated 25 September 2019 was not a valid order under Section 25-O and did not defeat deemed permission under Section 25-O(3).

Issue (ii): Whether the Deputy Secretary was the competent authority to deal with the closure application and, if not, what was the legal consequence

Analysis: The power under Section 25-O vested in the appropriate Government, and the record showed that the competent decision-making authority was the Minister for Labour. There was no reliable basis to treat the Deputy Secretary's communication as an order of the appropriate Government. Internal file notings could not substitute for lawful exercise of power or establish the requisite application of mind by the competent authority. Since the Minister did not independently decide the matter and the communication was issued without proper authority, the application remained undisposed of in law within the statutory period, attracting the deeming fiction. The Court also noted that the employer had shown compelling circumstances for closure because the undertaking had no other viable manufacturing work.

Conclusion: The Deputy Secretary was not the competent authority and the defect in authority and decision-making entitled the appellants to deemed closure.

Final Conclusion: The closure application was held to have satisfied the statutory requirements for deemed permission, and the interference made through the impugned communications was set aside, resulting in relief to the employer.

Ratio Decidendi: In proceedings for closure under Section 25-O of the Industrial Disputes Act, 1947, only a lawful order of the appropriate Government passed with application of mind and in the statutory form can prevent deemed permission; an unauthorised communication or internal administrative noting cannot substitute for such an order.

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