Allowed

Association of Enginering Workers v. M/S. Killick Nixon Ltd.

Bombay HC3 Jul 2006WP/760/2004

Case brief

AI extract

What is this about?

Petitioners challenged a Labour Court award denying 50% back wages and offering an employer option to pay lump sum dues instead of reinstatement. The High Court held the award suffered from non-application of mind due to lack of recorded reasons and reversed the decision to uphold full back wages and reinstatement.

What did the court decide?

Full back wages ordered to be paid to petitioners; award denying 50% of back wages and offering reinstatement option set aside.

IN THE HIGH	COURT OF	JUDICATURE	AT BOMBAY
ORDINARY	ORIGINAL	CIVIL	JURISDICTION
WRIT	PETITION	NO.760	OF 2004

IN
THE
HIGH

COURT
OF

JUDICATURE

AT
BOMBAY

ORDINARY

ORIGINAL

CIVIL

JURISDICTION

WRIT

PETITION

NO.760

OF
2004

Association of Engineering Workers			...Petitioners
v/s
M/s Killick Nixon Ltd.			...Respondents
Mr N.M.	Ganguli		for	Petitioners.
None	for			Respondents.
CORAM :	D.K.		DESHMUKH	J.
DATE :		3RD	JULY	2006.

Association of Engineering Workers

...Petitioners

v/s

M/s Killick Nixon Ltd.

...Respondents

Mr
N.M.

Ganguli

for

Petitioners.

None

for

Respondents.

CORAM
:

D.K.

DESHMUKH

DATE
:

3RD

JULY

2006.

1.	By this petiti	on, the petitioners challenge
the	award dated 28th	July 2003 passed by	the	Labour
Court	in Reference (IDA)	No.383 of 1994 in so	far	as it
denies	50 % back wages	to the petitioners and	gives	an
option	to the employer	to pay Rs.85,000/-	to	the
petitioners	in lieu of	reinstatement and bac	k	wages.
The	submission of	the learned counsel app	earing	for
petitioners	is that once	the Court found	that	the
petitioners	were entitled	to reinstatement in		service,
if	the Court wanted to	deprive the petitioners of	50	%
of	the back wages, it	was for the Court to	give	reasons
for	doing so. Similarl	y, if the Labour Court	want	ed to
give	to the employer	an option of not reins	tating	the
petitioners	in service an	d not paying 50 % ba	ck	wages
and	paying only Rs.85,0	00/- in lieu thereof, it	wa	s for
the	Labour Court to	give reasons, firstly why	it	was
necessary	for the Cou	rt to follow such a	course	and
secondly	to indicate ho	w the Court has arrived	at	the
figure	of Rs.85,000/-	as adequate compensation.		None
appears	for the respondents.	I have perused	the	record.
The	Labour Court fou	nd that the termination	of	the
petitioners	was illegal	and then it referred	to	the
normal	rule that if the	Court finds that th	e te	rmination
is	illegal and the	employee is e	ntitled	to

By this petiti

on, the petitioners challenge

the

award
dated
28th

July
2003
passed
by

the

Labour

Court

in
Reference
(IDA)

No.383
of
1994
in
so

far

as
it

denies

50
%
back
wages

to
the
petitioners
and

gives

option

to
the
employer

to
pay
Rs.85,000/-

the

petitioners

in
lieu
of

reinstatement
and
bac

wages.

The

submission
of

the
learned
counsel
app

earing

for

petitioners

is
that
once

the
Court
found

that

the

petitioners

were
entitled

to
reinstatement
in

service,

the
Court
wanted
to

deprive
the
petitioners
of

the
back
wages,
it

was
for
the
Court
to

give

reasons

for

doing
so.
Similarl

y,
if
the
Labour
Court

want

ed
to

give

to
the
employer

an
option
of
not
reins

tating

the

petitioners

in
service
an

d
not
paying
50
%
ba

wages

and

paying
only
Rs.85,0

00/-
in
lieu
thereof,
it

s
for

the

Labour
Court
to

give
reasons,
firstly
why

was

necessary

for
the
Cou

rt
to
follow
such
a

course

and

secondly

to
indicate
ho

w
the
Court
has
arrived

the

figure

of
Rs.85,000/-

as
adequate
compensation.

None

appears

for
the
respondents.

I
have
perused

the

record.

The

Labour
Court
fou

nd
that
the
termination

the

petitioners

was
illegal

and
then
it
referred

the

normal

rule
that
if
the

Court
finds
that
th

e
te

rmination

illegal
and
the

employee
is
e

ntitled

reinstatement, then he will	be entitled	for full	back
wages. The Court also re	ferred to the	rule that	the
Court can depart from this	general rule	in	exceptional
circumstance. The Court	has also found	that if	the
Court finds that it is	inequitable	to direct	the
employer to pay full back	wages, then	the Court	can
mould the relief. The	Court refers t	o the	submission
made on behalf of the	employer th	at the	financial
position of the Company is	not good,	but the	Court
observes that there are no	pleadings to	that effe	ct and
there is no material placed	on record	by the	employer
that the financial position of	the employer	is not	good.
Though the Court records th	at the emplo	yer has	neither
placed material on record to	show that	there are	reasons
in existence for denying 50	% back	wages t	o the
employees, the Court neverthel	ess denies 50	% of	the
back wages to the employe	es. Thus, I	find that	the
submission made on behalf	of the pet	itioners that	the
Labour Court has not given	any reason why	50 % of	the
back wages are to be withhe	ld has substan	ce and has	to
be accepted. Now in so	far as the	aspect of	option
given to the employer is	concerned, the	Court ref	ers to
the argument of the employer	that the	employer is	unable
to pay, but the Court itself	observes tha	t there is	no
evidence placed on record by	the employer	to prove	that.
The Labour Court, however,	proceeds to	give option	to
the employer of not rein	stating the em	ployees and	not

reinstatement,
then
he
will

be
entitled

for
full

back

wages.
The
Court
also
re

ferred
to
the

rule
that

the

Court
can
depart
from
this

general
rule

exceptional

circumstance.
The
Court

has
also
found

that
if

the

Court
finds
that
it
is

inequitable

to
direct

the

employer
to
pay
full
back

wages,
then

the
Court

can

mould
the
relief.
The

Court
refers
t

o
the

submission

made
on
behalf
of
the

employer
th

at
the

financial

position
of
the
Company
is

not
good,

but
the

Court

observes
that
there
are
no

pleadings
to

that
effe

ct
and

there
is
no
material
placed

on
record

by
the

employer

that
the
financial
position
of

the
employer

is
not

good.

Though
the
Court
records
th

at
the
emplo

yer
has

neither

placed
material
on
record
to

show
that

there
are

reasons

in
existence
for
denying
50

%
back

wages
t

o
the

employees,
the
Court
neverthel

ess
denies
50

%
of

the

back
wages
to
the
employe

es.
Thus,
I

find
that

the

submission
made
on
behalf

of
the
pet

itioners
that

the

Labour
Court
has
not
given

any
reason
why

50
%
of

the

back
wages
are
to
be
withhe

ld
has
substan

ce
and
has

be
accepted.
Now
in
so

far
as
the

aspect
of

option

given
to
the
employer
is

concerned,
the

Court
ref

ers
to

the
argument
of
the
employer

that
the

employer
is

unable

to
pay,
but
the
Court
itself

observes
tha

t
there
is

evidence
placed
on
record
by

the
employer

to
prove

that.

The
Labour
Court,
however,

proceeds
to

give
option

the
employer
of
not
rein

stating
the
em

ployees
and

not

paying them 50 % back wages by referring to the	period
of their non-employment, their wages and total period	of
employment with the employer till the date of award	and
the remaining period of employment. In my opinion,	the
reasons given by the Labour Court for giving the	opinion
to the employer are vague. Once the labour Court	did
not accept the submission on behalf of the employer	that
it has no capacity to pay and it cannot reinstate	the
employees, then there was no justification for	giving
option to the employer not to reinstate the e	mployees
and not to pay them 50 % of back wages by paying	only
Rs.85,000/- to them. I find that no cogent reason	has
been given by the Labour Court for giving this optio	n to
the employer. The award made by the Labour	Court
denying 50 % of the back wages to the petitioners	and
giving option to the employer not to reinstate	the
employees suffers from non-application of mind and	has
been passed in breach of the principles of natural

paying
them
50
%
back
wages
by
referring
to
the

period

of
their
non-employment,
their
wages
and
total
period

employment
with
the
employer
till
the
date
of
award

and

the
remaining
period
of
employment.
In
my
opinion,

the

reasons
given
by
the
Labour
Court
for
giving
the

opinion

to
the
employer
are
vague.
Once
the
labour
Court

did

not
accept
the
submission
on
behalf
of
the
employer

that

it
has
no
capacity
to
pay
and
it
cannot
reinstate

the

employees,
then
there
was
no
justification
for

giving

option
to
the
employer
not
to
reinstate
the
e

mployees

and
not
to
pay
them
50
%
of
back
wages
by
paying

only

Rs.85,000/-
to
them.
I
find
that
no
cogent
reason

has

been
given
by
the
Labour
Court
for
giving
this
optio

n
to

the
employer.
The
award
made
by
the
Labour

Court

denying
50
%
of
the
back
wages
to
the
petitioners

and

giving
option
to
the
employer
not
to
reinstate

the

employees
suffers
from
non-application
of
mind
and

has

been passed in breach of the principles of natural

Association of Enginering Workers v. M/S. Killick Nixon Ltd.

Case brief

What is this about?

What did the court decide?

Association of Enginering Workers v. M/S. Killick Nixon Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Statutes considered

Parties & counsel

Coram

Case details

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