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Madras High Court· 25 September 2026

Does mere closure of shops imply that the tenure of workmen accommodated in other shops stood terminated under the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981?

The District Manager v. The Assistant Commissioner of Labour (Enforcement)
WA(MD).2017/2025 · 2026:MHC:3941 · W.A.(MD)No.2017 of 2025
Coram: Justice C.V. Karthikeyan · Justice R.Sakthivel
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Answer

Mere closure of shops does not imply that the tenure of workmen accommodated in other shops stood terminated.

No. Mere closure of shops does not imply that the tenure of workmen accommodated in other shops stood terminated. The workmen of the closed shops had not been terminated but accommodated in other shops, which itself showed that the Government recognised their status. Though the Government has a right to close down any shop, that does not give it a right to terminate the services of the workmen of those shops.

Headnote

Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981 — Ss.2(3)(e), 3, 9 — Tamil Nadu Shops and Establishments Act, 1947 — Ss.2(6), 4(1)(c) — Conferment of permanent status — TASMAC salesmen — Exemption of Government establishments — Letter of the Principal Secretary — Closure of shops — Permanent Status Act, 1981 — S.9 — Exemption — Letter of the Principal Secretary to the Government — Held: A letter of the Principal Secretary to the Government opining that no exemption is required is at most a private opinion of its author; it is not the law of the land, does not bind the Court and is not a notification granting exemption. When the law directs a particular act to be performed in a particular manner, it must be done only in that manner. (¶27, 34) Shops and Establishments Act, 1947 — S.4(1)(c) — Incorporation by reference — Definition of establishment — Held further: Only the definition of establishment is incorporated from the Shops Act into the Permanent Status Act, so the exemption in s.4(1)(c) of the Shops Act is of no consequence, and the Permanent Status Act continues to apply unless exemption is obtained from the State Government under s.9. V. Elayaperumal v. State Bank of India, 2007 (2) LLN 212, followed. (¶35, 36) Permanent Status Act, 1981 — S.3 — 480 days of continuous service — Closure of shops — Held further: A workman with 480 days of continuous service within 24 consecutive months must automatically be made a permanent employee; mere closure of shops does not imply that the tenure of workmen accommodated in other shops stood terminated. Writ appeals dismissed. (¶28, 37, 40, 43)

Headnote

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In the Court's own words
Paragraph 40The learned Additional Advocate General further argued that the State had closed 717 liquor shops and that therefore, the workmen cannot claim any recognizable status. However, what had been missed is that the services of the workmen or salesmen, who were working in those 717 shops, had not been ordered to be terminated, but they had been accommodated in other shops, which fact itself would show that their status had been recognised by the Government and that mere closure of shops can never be stretched to imply that the tenure of the workmen also stood terminated . They continued to work. They continued to work only because they were recognised as permanent workmen. Their status can never be disputed by the appellant. Therefore, though the Government has a right to close down any shop, it would not mean that the Government has a right to terminate the services of the workmen of those shops.
Paragraph 41The Government has to abide by the law of the land and grant permanent status to their employees who had been rendering service continuously and definitely for more than the mandatory period stipulated by law.
Acts & Sections
Section 3 Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981Section 9 Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981Section 2(6) Tamil Nadu Shops and Establishments Act, 1947Section 4(1)(c) Tamil Nadu Shops and Establishments Act, 1947

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Also decided in this judgment
Is a letter of the Principal Secretary to the Government a notification granting exemption under Section 9 of the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981?Is Section 4(1)(c) of the Tamil Nadu Shops and Establishments Act, 1947 of no consequence to the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981, which incorporated only the definition of establishment?Must a workman with 480 days of continuous service within 24 consecutive months automatically be made a permanent employee under the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981?
Plain-language answer prepared by the LexStreak Editorial Desk — verify against the judgment. Source: Madras High Court. Corrections