Dismissed

Ramesh Kumar v. M.D.Forest Corporation Ltd.

Himachal Pradesh HC2 Nov 2017CWP/5324/2012

Case brief

AI extract

What is this about?

Workman, engaged as daily-wage Chowkidar, was reinstated with continuity and seniority by the Labour Court after termination without domestic inquiry, but back wages were denied. The High Court upheld the denial, holding that compensation, not back wages, is the norm for daily wagers terminated for procedural defects, and the workman's delay in raising the dispute weighed against relief.

What the court decided

AI extract

Ramesh Kumar Vs M.D.Forest Corporatio… — Labour and Industrial Disputes | Himachal Pradesh HC (2017)

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IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA.

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CWP No.5324 of 2012.

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Judgment reserved on : 25.10.2017 Date of decision: 2^nd November, 2017.

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Ramesh Kumar .….Petitioner.

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Versus

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Managing Director and another …..Respondents.

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Coram

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The Hon’ble Mr. Justice Tarlok Singh Chauhan, Judge. Whether approved for reporting?¹ No

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For the Petitioner : Mr.R.S.Chandel, Advocate.

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For the Respondents: Mr.Pranay Pratap Singh, Advocate.

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Tarlok Singh Chauhan, Judge.

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This petition at the instance of the workman is directed against the award passed by the learned Industrial Tribunal-cum-Labour Court, Shimla (for short ‘Labour Court’) on 11.01.2012 whereby the back wages have been denied to him, though he has been ordered to be reinstated in service along with seniority and continuity.

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The facts lie in a narrow compass.

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The petitioner in the year 1992 was engaged as daily waged Chowkidar by the respondents and posted at Banga Pani Depot at Shimla and while working a theft took place on the intervening night of 22/23.06.1999. The respondents conducted a preliminary inquiry by associating the petitioner and thereafter show cause notice was issued on 12.07.1999 which was followed by another notice dated 17.08.1999. It

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Whether the reporters of the local papers may be allowed to see the Judgment?Yes

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was alleged that the respondents without considering the replies submitted to these show cause notices terminated his services without holding any domestic inquiry and following any procedure. The petitioner challenged the order before the learned State Administrative Tribunal, however, the petition so preferred was dismissed for want of jurisdiction. It is thereafter that the petitioner resorted to the remedy as available to him under the Industrial Disputes Act (for short ‘Act’).

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The respondents filed their reply to the claim petition wherein it was contended that the services of the petitioner were dispensed with on account of willful absence of the petitioner on the intervening night of 22/23.06.1999 when there was a theft of sixty scants of ‘Deodar’.

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The learned Labour Court framed the following issues:-

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“1. Whether the termination of the services of the petitioner by the respondents w.e.f. 14.10.1999 without conducting any proper domestic enquiry and without complying the provisions of Industrial Disputes Act, 1947 is illegal and improper as alleged? OPP.

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If issue No.1 is proved, to what amount of back wages, seniority, past service benefits and compensation the petitioner is entitled to? OPP.

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Whether the petition is not maintainable as alleged? OPR.

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Whether the petitioner has no locus standi to file and maintain the petition? OPR.

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Whether the petitioner is estopped from filing the petition by his own acts, deed and conduct as alleged? OPR.

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Whether the petition is time barred? OPR.

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Relief.”

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After recording evidence and evaluating the same, the learned Labour Court passed the award as aforesaid.

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It is vehemently argued by Shri R.S.Chandel, learned counsel for the petitioner that the award of the learned Labour Court insofar as it

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relates to the denial of the back wages to the petitioner is contrary to law, more particularly, when there was ample evidence available on record to suggest that the petitioner was not gainfully employed during the intervening period from the date of termination of his services till the date of his re-engagement.

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I have heard the learned counsel for the parties and have also gone through the material placed on record.

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It is more than settled that ordinary principle of grant of reinstatement with full back wages, when the termination is found to be illegal is not applied mechanically in all cases and may be applied where the services of a regular/permanent workman are terminated illegally and/or malafide and/or by way of victimization, unfair labour practice etc. However, where services of a daily wager are terminated illegally for some procedural defect, he is normally to be granted monetary compensation and not reinstated with back wages since it is always open to the management to terminate the services of an employee by paying him the retrenchment compensation because he has no right to seek regularization. This was so observed by the Hon’ble Supreme Court in Bharat Sanchar Nigam Limited versus Bhurumal (2014) 7 SCC 177 and paragraphs 29 to 37 read thus:-

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“29. The learned counsel for the appellant referred to two judgments wherein this Court granted compensation instead of reinstatement. In BSNL vs. Man Singh (2012) 1 SCC 558, this Court has held that when the termination is set aside because of violation of Section 25-F of the Industrial Disputes Act, it is not necessary that relief of reinstatement be also given as a matter of right. In Incharge Officer vs. Shankar Shetty (2010) 9 SCC 126, it was held that those cases where the workman had worked on daily wage basis, and worked merely for a period of 240 days or 2 to 3 years and where the termination had taken place many

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years ago, the recent trend was to grant compensation in lieu of reinstatement.

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30. In this judgment of Shankar Shetty (supra), this trend was reiterated by referring to various judgments, as is clear from the following discussion: (SCC pp. 127-28, paras 2-4)

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“2. Should an order of reinstatement automatically follow in a case where the engagement of a daily wager has been brought to end in violation of Section 25-F of the Industrial Disputes Act, 1947 (for short “the ID Act”)? The course of the decisions of this Court in recent years has been uniform on the above question.

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3. In Jagbir Singh v. Haryana State Agriculture Mktg..Board (2009) 15 SCC 327, delivering the judgment of this Court, one of us (R.M.Lodha,J.) noticed some of the recent decisions of this Court, namely, U.P.State Brassware Corpn. Ltd. V. Uday Narain Pandey (2006) 1 SCC 479, Uttaranchal Forest Development Corpn. V. M.C. Joshi (2007) 9 SCC 353, State of M.P. v. Lalit Kumar Verma (2007) 1 SCC 575, M.P.Admn v.Tribhuban (2007) 9 SCC 748, Sita Ram v.Moti Lal Nehru Farmers Training Institute (2008) 5 SCC 75, Jaipur Development Authority v. Ramsahai (2006) 11 SCC 684,, GDA v. Ashok Kumar (2008) 4 SCC 261, and Mahboob Deepak v.Nagar Panchyat, Gajraula (2008) 1 SCC 575 and stated as follows: (Jagbir Singh case, SCC pp.330 & 335 paras 7 & 14)

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‘7. It is true that the earlier view of this Court articulated in many decision reflected the legal position that if the termination of an employee was found to be illegal, the relief of reinstatement with full back wages would ordinarily follow. However, in recent past, there has been a shift in the legal position and in a long line of cases, this Court has consistently taken the view that relief by way of reinstatement with back wages is not automatic and may be wholly inappropriate in a given fact situation even though the termination of an employee is in contravention of the prescribed procedure. Compensation instead of reinstatement has been held to meet the ends of justice.

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14. It would be, thus, seen that by a catena of decisions in recent time, this Court has clearly laid down that an order of retrenchment passed in violation of Section 25-F although may be set aside but an award of reinstatement should not, however, automatically passed. The award of reinstatement with full back wages in a case where the workman has completed 240 days of work in a year preceding the date of termination, particularly, daily wagers has not been found to be proper by this Court and instead compensation has been awarded. This Court has distinguished between a daily wager who does not hold a post and a permanent employee.’

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4. Jagbir Singh has been applied very recently in Telegraph Deptt. V. Santosh Kumar Seal (2010) 6 SCC 773, wherein this Court stated: (SCC p.777, para 11)

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‘11. In view of the aforesaid legal position and the fact that the workmen were engaged as daily wagers about 25 years back and they worked hardly for 2 or 3 years, relief of reinstatement and back wages to them cannot be said to be justified and instead monetary compensation would subserve the ends of justice.’”

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31. In Deptt. of Telecommunications v. Keshab Deb (2008) 8 SCC 402, the Court emphasized that automatic direction for reinstatement of the workman with full back wages is not contemplated. He was at best entitled to one months’ pay in lieu of one month’s notice and wages of 15 days of each completed year of service as envisaged under Section 25-F of the Industrial Disputes Act. He could not have been directed to be regularized in service or granted /given a temporary status. Such a scheme has been held to be unconstitutional by this Court in A.Umarani v. Registrar, Coop. Societies (2004) 7 SCC 112 and Secy.,State of Karnataka v. Umadevi(3) (2006) 4 SCC 1.

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32. It was further submitted by the learned counsel for the appellant that likewise, even when reinstatement was ordered, it does not automatically follow full back wages should be directed to be paid to the workman. He drew our attention of this Court in the case of Coal India Ltd. Vs. Ananta Saha(2011) 5 SCC 142 and Metropolitan Transport Corporation v. V.Venkatesan (2009) 9 SCC 601.

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33. It is clear from the reading of the aforesaid judgments that the ordinary principle of grant of reinstatement with full back wages, when the termination is found to be illegal is not applied mechanically in all cases. While that may be a position where services of a regular/permanent workman are terminated illegally and/or malafide and/or by way of victimization, unfair labour practice etc. However, when it comes to the case of termination of a daily wage worker and where the termination is found illegal because of procedural defect, namely in violation of Section 25-F of the Industrial Disputes Act, this Court is consistent in taking the view in such cases reinstatement with back wages is not automatic and instead the workman should be given monetary

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compensation which will meet the ends of justice. Rationale for shifting in this direction is obvious.

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34. Reasons for denying the relief of reinstatement in such cases are obvious. It is trite law that when the termination is found to be illegal because of non-payment of retrenchment compensation and notice pay as mandatorily required under Section 25-F of the Industrial Disputes Act, even after reinstatement, it is always open to the management to terminate the services of that employee by paying him the retrenchment compensation. Since such a workman was working on daily wage basis and even after he is reinstated, he has no right to seek regularization (See: State of Karnataka vs. Uma Devi(3) (2006) 4 SCC 1). Thus when he cannot claim regularization and he has no right to continue even as a daily wage worker, no useful purpose is going to be served in reinstating such a workman and he can be given monetary compensation by the Court itself inasmuch as if he is terminated again after reinstatement, he would receive monetary compensation only in the form of retrenchment compensation and notice pay. In such a situation, giving the relief of reinstatement, that too after a long gap, would not serve any purpose.

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35. We would, however, like to add a caveat here. There may be cases where termination of a daily wage worker is found to be illegal on the ground it was resorted to as unfair labour practice or in violation of the principle of last come first go viz. while retrenching such a worker daily wage juniors to him were retained. There may also be a situation that persons junior to him wee regularized under some policy but the concerned workman terminated. In such circumstances, the terminated worker should not be denied reinstatement unless there are some other weighty reasons for adopting the course of grant of compensation instead of reinstatement. In such cases, reinstatement should be the rule and only in exceptional cases for the reasons stated to be in writing, such a relief can be denied.

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36. Applying the aforesaid principles, let us discuss the present case. We find that the respondent was working as a daily wager. Moreover, the termination took place more than 11 years ago. No doubt, as per the respondent he had worked for 15 years.

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However, the fact remains that no direct evidence for working 15 years has been furnished by the respondent and most of his documents are relatable to two years i.e. 2001 and 2002. Therefore, this fact becomes relevant when it comes to giving the relief. Judicial notice can also be taken of the fact that the need of lineman in the telephone department is drastically reduced after the advancement of technology. For all these reasons, we are of the view that ends of justice would be met by granting compensation in lieu of reinstatement.

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37. In Man Singh (supra) which was also a case of BSNL, this Court had granted compensation of Rs.2 Lakh to each of the workmen when they had worked for merely 240 days. Since the respondent herein worked for longer period, we are of the view that he should be paid a compensation of Rs.3 lakhs. This compensation should be paid within 2 months failing which the respondent shall also be entitled to interest at the rate of 12% per annum from the date of this judgment. Award of the CGIT is modified to this extent. The appeal is disposed of in the above terms. The respondent shall also be entitled to the cost of Rs.15,000/-(Rupees Fifteen Thousand only) in this appeal.”

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As regards the back wages, a three Judge Bench of the

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Hon’ble Supreme Court in Hindustan Tin Works Private Limited versus Employees of M/s Hindustan Tin Works Private Limited and others (1979) 2 SCC 80 has held that there cannot be a straightjacket formula for awarding relief of back wages and all relevant considerations will enter the verdict. The Tribunal will have to exercise its discretion keeping in view all the relevant circumstances, but the discretion must be exercised in a judicial and judicious manner. The reason for exercising discretion must be cogent and reliable and must appear on the face of the record. It is not to be arbitrary, vague and fanciful, but legal and regular.

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Adverting to the facts, it would be noticed that the learned Labour Court had set aside the termination only on the ground that the respondents after having conducted preliminary inquiry have not

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conducted a regular inquiry and, therefore, the termination of services of the petitioner was in violation of Section 25-F of the Act. No findings have been recorded on the merits of the allegations against the petitioner and, therefore, the ratio of the judgment in Bhurumal’s case (supra) is fully attracted and applicable to the facts of the instant case. Moreover, it would be noticed that the services of the petitioner had been terminated with effect from 14.10.1999, whereas, the reference came to be instituted only on 01.08.2008.

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No doubt, the reference was held to be within time, but the delay in filing of the same is a circumstance which has to be considered at the time of granting or declining relief to a party and, therefore, in the given circumstances, it wi ll be wholly inequitable to award back wages.

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It is vehemently argued by Shri R.S. Chandel, learned counsel for the petitioner that he had been pursuing his remedy before the learned Administrative Tribunal and, therefore, cannot be said to be sleeping over his rights. However, I find myself unable to accept this contention for the simple reason that pursuing a remedy before a Forum having no jurisdiction will not entitle the petitioner to claim back wages as it was for him to have chosen the right Forum for the redressal of his grievance.

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Once, it is established on record that it is the petitioner, who is to be blamed for delay in pursuing his remedy, then obviously, the respondents cannot be penalized for no fault on their part.

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Similar issue has already been considered by me in Rajinder Singh versus State of H.P. and another 2015-I-LLJ-108(HP) wherein it was observed as under:-

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“4. Undisputedly, the petitioner at the first instance had approached the Labour Court after more than 13 years and yet was fortunate to have been awarded the relief of reengagement from

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the date of reference. Going by the recent trend of judgements of the Hon’ble Supreme Court, the reference was bound to have been rejected on the ground of delay and laches, whereby the petitioner was seeking to enforce a stale claim. This would be clear from the following observations of the Hon’ble Supreme Court in its recent decision of Hari Nandan Prasad and another vs. Employeer I/R to Management of FCI and another 2014 AIR SCW 1383: AIR 2014 SC 1848: (2014) 7 SCC 190: LNIND 2014 SC 303:

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“15. We have given considerable thoughts to the submissions made by the learned counsel for the parties on either side. It is clear from the aforesaid narratives that this case has two facets, which are reflected even in the terms of references as well on which the disputes were referred to the CGIT. First refers to the validity of the termination and the other one pertains to the regularization. Twin issues, which have, thus, to be gone into, are:

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(1) whether termination of service of the appellants was illegal?

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Related issue here would be that if it is illegal, then whether in the facts and circumstances of this case, the appellants would be entitled to reinstatement in service or monetary compensation in lieu of reinstatement would be justified? (2) whether the appellants are entitled to regularization of their services?

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We would also record that both the issues, in the facts of this case, are somewhat overlapping which would become apparent, with the progression of our discussion on these issues.

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Reg.: Validity of termination.

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16. This issue hardly poses any problem. Admitted facts are that both the appellant had worked for more than 240 days continuously preceding their disengagement/termination. At the time of their disengagement, even when they had continuous service for more than 240 days (in fact about 3 years) they were not given any notice or pay in lieu of notice as well as retrenchment compensation. Thus, mandatory pre-condition of retrenchment in paying the aforesaid dues in accordance with Section 25-F of the I.D. Act was not complied with. That is sufficient to render the termination as illegal. Even the High Court in the impugned judgment has accepted this position and there was no quarrel on this aspect before us as well. With this, we advert to the issue of relief which should be granted in such cases, as that was the topic of hot debate before us as well.

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17. Admittedly, both the workmen were engaged on daily wages basis. Their engagement was also in exigency of situation. In so far as appellant No.1 is concerned, he was disengaged way back in the year 1983. The dispute in his case was referred for adjudication to CGIT in 1992 only. There is a time lag of 9 years. Though no reasons are appearing on record for such an abnormal delay, it seems that he had raised the industrial dispute few years after his disengagement which can be inferred from the reading of the award of the CGIT as that reveals that after his disengagement he kept on making representations only and he took recourse to judicial proceedings only after Circular dated 6.5.1997 was issued as per which the FCI had decided to regularize the services of all casual workmen who had completed more than 90 days before 1996. Be that as it may, at this juncture what we are highlighting is that appellant No.1 had worked on daily wages basis for barely 3 years and he is out of service for last 30 years. Even when the Tribunal rendered his award in 1996, 13 years had elapsed since his termination. On these facts, it would be difficult to give the relief of reinstatement to the persons who were engaged as daily wagers and whose services were terminated in a distant past. And, further where termination is held to be illegal only on a technical ground of not adhering to the provisions of Section 25-F of the Act. Law on this aspect, as developed over a period of time by series of judgments makes the aforesaid legal position very eloquent. It is not necessary to traverse through all these judgments. Our purpose would be served by referring to a recent judgment rendered by this very Bench in the case of BSNL vs. Bhurumal 2013 (15) SCALE 131 which has taken note of the earlier case law relevant to the issue. Following passage from the said judgment would reflect the earlier decisions of this Court on the question of reinstatement:

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“The learned counsel for the appellant referred to two judgments wherein this Court granted compensation instead of reinstatement. In the case of BSNL vs. Man Singh (2012) 1 SCC 558, this Court has held that when the termination is set aside because of violation of Section 25-F of the Industrial Disputes Act, it is not necessary that relief of reinstatement be also given as a matter of right. In the case of Incharge Officer & Anr. vs. Shankar Shetty (2010) 9 SCC 126, it was held that those cases where the workman had worked on daily wage basis, and worked merely for a period of 240 days or 2-3 years and where the termination had taken place many years ago, the recent trend was to grant compensation in lieu of reinstatement. In this judgment of Shankar

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Shetty, this trend was reiterated by referring to various judgments, as is clear from the following discussion.

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Should an order of reinstatement automatically follow in a case where the engagement of a daily wager has been brought to end in violation of Section 25-F of the Industrial Disputes Act, 1947 (for short “the ID Act”)? The course of the decisions of this Court in recent years has been uniform on the above question.

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In Jagbir Singh vs. Haryana State Agriculture Mktd. Board (2009) 15 SCC 327 delivering the judgment of this Court, one of us (R.M.Lodha,J.) noticed some of the recent decisions of this Court, namely, U.P.State Brassware Corpn. Ltd. Vs. Uday Narain Pandey (2006) 1 SCC 479, Uttaranchal Forest Department Corpn. Vs. M.C.Joshi (2007) 9 SCC 353, State of M.P. vs. Lalit Kumar Verma (2007) 1 SCC 575,M.P.Admn. vs. Tribhuban (2007) 9 SCC 748, Sita Ram vs. Moti Lal Nehru Farmers Training Institute (2008) 5 SCC 75, Jaipur Development Authority vs. Ramsahai (2006) 11 SCC 684, GDA vs. Ashok Kumar (2008) 4 SCC 261 and Mahboob Deepak vs. Nagar Panchayat, Gajraula (2008) 1 SCC 575 and stated as follows: (Jagbir Singh case, SCC pp.330 & 335 paras 7 & 14).

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It is true that the earlier view of this Court articulated in many decision reflected the legal position that if the termination of an employee was found to be illegal, the relief of reinstatement with full back wages would ordinarily follow. However, in recent past, there has been a shift in the legal position and in a long line of cases, this Court has consistently taken the view that relief by way of reinstatement with back wages is not automatic and may be wholly inappropriate in a given fact situation even though the termination of an employee is in contravention of the prescribed procedure. Compensation instead of reinstatement has been held to meet the ends of justice.

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It would be, thus, seen that by a catena of decisions in recent time, this Court has clearly laid down that an order of retrenchment passed in violation of Section 25-F although may be set aside but an award of reinstatement should not, however, automatically passed. The award of reinstatement with full back wages in a case where the workman has completed 240 days of work in a year preceding the date of termination, particularly, daily wagers has not been found to be proper by this Court and instead compensation has been awarded. This Court has distinguished between a daily wager who does not hold a post and a permanent employee.

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Jagbir Singh has been applied very recently in Telegraph Deptt. Vs. Santosh Kumar Seal (2010) 6 SCC 773, wherein this Court stated: (SCC p.777, para 11)

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In view of the aforesaid legal position and the fact that the workmen were engaged as daily wagers about 25 years back and they worked hardly for 2 or 3 years, relief of reinstatement and back wages to them cannot be said to be justified and instead monetary compensation would subserve the ends of justice.

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Taking note of the judgments referred to in the aforesaid paragraphs and also few more cases in other portion of the said judgment, the legal position was summed up in the following manner:

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“It is clear from the reading of the aforesaid judgments that the ordinary principle of grant of reinstatement with full back wages, when the termination is found to be illegal is not applied mechanically in all cases. While that may be a position where services of a regular/permanent workman are terminated illegally and/or malafide and/or by way of victimization, unfair labour practice etc. However, when it comes to the case of termination of a daily wage worker and where the termination is found illegal because of procedural defect, namely in violation of Section 25-F of the Industrial Disputes Act, this Court is consistent in taking the view in such cases reinstatement with back wages is not automatic and instead the workman should be given monetary compensation which will meet the ends of justice. Rationale for shifting in this direction is obvious.

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Reasons for denying the relief of reinstatement in such cases are obvious. It is trite law that when the termination is found to be illegal because of nonpayment of retrenchment compensation and notice pay as mandatorily required under Section 25-F of the Industrial Disputes Act, even after reinstatement, it is always open to the management to terminate the services of that employee by paying him the retrenchment compensation. Since such a workman was working on daily wage basis and even after he is reinstated, he has no right to seek regularization (See: State of Karnataka vs. Uma Devi (2006) 4 SCC 1). Thus when he cannot claim regularization and he has no right to continue even as a daily wage worker, no useful purpose is going to be served in reinstating such a workman and he can be given monetary compensation by the Court itself inasmuch as if he is terminated again after reinstatement, he would receive monetary compensation only in the form of retrenchment compensation and notice pay. In such a situation, giving the relief of reinstatement, that too after a long gap, would not serve any purpose.

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We would, however, like to add a caveat here. There may be cases where termination of a daily wage worker is found to be illegal on the ground it was resorted to as unfair labour practice or in violation of the principle of last come first go viz. while retrenching such a worker daily wage juniors to him were retained. There may also be a situation that persons junior to him were regularized under some policy but the concerned workman terminated. In such circumstances, the terminated worker should not be denied reinstatement unless there are some other weighty reasons for adopting the course of grant of compensation instead of reinstatement. In such cases, reinstatement should be the rule and only in exceptional cases for the reasons stated to be in writing, such a relief can be denied”.

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5. Apart from that even if the petitioner had moved the tribunal below promptly, even then probably what would have been awarded to him would be probably a lump sum compensation taking into consideration the recent trend of the Hon’ble Supreme Court. Reference can conveniently be made in Assistant Engineer, Rajasthan Development Corporation and another vs. Gitam Singh (2013) 5 SCC 136 : LNIND 2013 SC 390: 2013-II-LLJ-141, wherein the Hon’ble Supreme Court has held as follows:-

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“4. It is not in dispute that respondent was engaged as a daily wager. The Labour Court, Bharatpur, in its award dated 28.06.2001 has recorded the findings that the respondent had worked as technician (Mistri) under the appellant for 240 days for the period from 01.03.1991 to 31.10.1991 and the termination of his service by an oral order on 31.10.1991 was violative of Section 25-F of the ID Act. We are not inclined to disturb the findings recorded by the Labour Court; we take them to be correct. The question, as noted above, is whether direction for reinstatement of respondent with continuity in service along with 25 per cent of back wages in view of the above findings is just and proper.

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5 . More than five decades back, this Court in Assam Oil Company Limited, New Delhi v. Its Workmen [AIR 1960 SC 1264] observed that the normal rule in cases of wrongful dismissal was reinstatement but there could be cases where it would not be expedient to follow this normal rule and to direct reinstatement. Having regard to the facts of that case, this Court set aside the order of reinstatement although dismissal of the employee was found to be wrongful and awarded compensation. In Hindustan Steels Ltd., Rourkela v. A.K. Roy and Others [(1969) 3 SCC 513], this Court noted that there have been cases where reinstatement has not been considered as either desirable or expedient.

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6 . In Ruby General Insurance Co. Ltd. v. Shri P.P. Chopra [(1969) 3 SCC 653], this Court reiterated what was stated in Assam Oil Company Limited. In paragraph 6 (pgs. 655-656) of the Report, this Court said (P.P. Chopra case, SCC pp.655-56) :

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“6. The normal rule is that in cases of invalid orders of dismissal industrial adjudication would direct reinstatement of a dismissed employee. Nevertheless, there would be cases where it would not be expedient to adopt such a course. Where, for instance, the office of the employer was comparatively a small one and the dismissed employee held the position of the secretary, a position of confidence and trust, and the employer had lost confidence in the concerned employee, reinstatement was held to be not fair to either party……………”

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7. This Court in Panitole Tea Estate v. The Workmen [(1971) 1 SCC 742], while dealing with the judicial discretion of the Labour Court or the Tribunal under ID Act in directing appropriate relief on setting aside the wrongful dismissal of a workman, stated in paragraph 5 as follows: (SCC pp. 746-47):

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“5…. The question whether on setting aside the wrongful dismissal of a workman he should be reinstated or directed to be paid compensation is a matter within the judicial discretion of the Labour Court or the Tribunal, dealing with the industrial dispute, the general rule in the absence of any special circumstances being of reinstatement. In exercising this discretion, fairplay towards the employee on the one hand and interest of the employer, including considerations of discipline in the establishment, on the other, require to be duly safeguarded. This is necessary in the interest both of security of tenure of the employee and of smooth and harmonious working of the establishment. Legitimate interests of both of them have to be kept in view if the order is expected to promote the desired objective of industrial peace and maximum possible production. The past record of the employer, the nature of the alleged conduct for which action was taken against him, the grounds on which the order of the employer is set aside, the nature of the duties performed by the employee concerned and the nature of the industrial establishment are some of the broad relevant factors which require to be taken into consideration. The factors just stated are merely illustrative and it is not possible to exhaustively enumerate them. Each case has to be decided on its own facts and no hard and fast rule can be laid down to cover generally all conceivable contingencies……”

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8. In Tulsidas Paul v. The Second Labour Court, W.B. and Others [(1972) 4 SCC 205 (2)], this Court relied upon M/s. Hindustan Steels Ltd. (10 Hindustan Steels Ltd. V. A.K.Roy, (1969)3SCC 513) and held as under ( Tulsidas Paul case, SCC P.208, para 9):

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“9. In Hindustan Steels Ltd. v. Roy [(1969) 3 SCC 513] we recently held, after considering the previous caselaw, that though the normal rule, in cases where dismissal or removal from service is found to be unjustified, is reinstatement, Industrial Tribunals have the discretion to award compensation in unusual or exceptional circumstances where the tribunal considers, on consideration of the conflicting claims of the employer on the one hand and of the workmen on the other, reinstatement inexpedient or not desirable. We also held that no hard and fast rule as to which circumstances would constitute an exception to the general rule can be laid down as the tribunal in each case must, in a spirit of fairness and justice and in keeping with the objectives of industrial adjudication, decide whether it should, in the interest of justice, depart from the general rule.”

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9. In L. Robert D'Souza vs. Southern Railway (1982) 1 SCC 645), this Court in paragraph 27 held as under: (SCC p.664)

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“27. ……….Therefore, assuming that he was a dailyrated worker, once he has rendered continuous uninterrupted service for a period of one year or more, within the meaning of Section 25-F of the Act and his service is terminated for any reason whatsoever and the case does not fall in any of the excepted categories, notwithstanding the fact that Rule 2505 would be attracted, it would have to be read subject to the provisions of the Act. Accordingly the termination of service in this case would constitute retrenchment and

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for not complying with pre- conditions to valid retrenchment, the order of termination would be illegal and invalid.”

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What has been held by this Court in L. Robert D'Souza vs. Southern Railway (1982) 1 SCC 645), is that Section 25-F of the ID Act is applicable to a daily-rated worker. We do not think that there is any dispute on this proposition.

¶105

10. In RBI v. S. Mani and Others [(2005) 5 SCC 100], this Court in paragraph 54 of the Report held as under: (SCC p.120):

¶106

“54. Mr. Phadke, as noticed hereinbefore, has referred to a large number of decisions for demonstrating that this Court had directed reinstatement even if the workmen concerned were daily- wagers or were employed intermittently. No proposition of law was laid down in the aforementioned judgments. The said judgments of this Court, moreover, do not lay down any principle having universal application so that the Tribunals, or for that matter the High Court, or this Court, may feel compelled to direct reinstatement with continuity of service and back wages. The Tribunal has some discretion in this matter. Grant of relief must depend on the fact situation obtaining in a particular case. The industrial adjudicator cannot be held to be bound to grant some relief only because it will be lawful to do so.”

¶107

11. In Nagar Mahapalika (Now Municipal Corpn.) v. State of U.P. and Others[(2006) 5 SCC 127], this Court, while dealing with the non-compliance with the provisions of Section 6-N (which is pari materia to Section 25-F) of U.P. Industrial Disputes Act held that the grant of relief of reinstatement with full back wages and continuity of service in favour of retrenched workmen would not automatically follow or as a matter of course. Instead, this Court modified the award of reinstatement with compensation of Rs. 30,000/- per workman. In Municipal Council, Sujanpur v. Surinder Kumar [(2006) 5 SCC 173], this Court after having accepted the finding that there was violation of Section 25-F of the ID Act, set aside the award of reinstatement with back wages and directed the workman to be paid monetary compensation in the sum of Rs. 50,000 /-. In Haryana State Electronics Development Corpn. Ltd. Vs. Mamni (2006) 9 SCC 434, this Court modified the award of reinstatement passed by the Labour Court, though the termination of the workman was in violation of Section 25-F of the ID Act, by directing that the workman should be compensated by payment of a sum of Rs. 25,000/-.

¶108

12. In SBI v. Mahatma Mishra [(2006) 13 SCC 727], this Court observed that: (SCC p. 734, para 12)

¶109

“12……It [was] one thing to say that services of a workman [were] terminated in violation of mandatory provisions of law but it [was] another thing to say that relief of reinstatement in service with full back wages would be granted automatically. “

¶110

13. In HUDA v. Om Pal[(2007) 5 SCC 742], this Court in paragraphs 7 and 8 of the Report held as under: (SCC p. 745):

¶111

¶112

“7. Moreover, it is also now well settled that despite a wide discretionary power conferred upon the Industrial Courts under Section 11-A of the 1947 Act, the relief of reinstatement with full back wages should not be granted automatically only because it would be lawful to do so. Grant of relief would depend on the fact situation obtaining in each case. It will depend upon several factors, one of which would be as to whether the recruitment was effected in terms of the statutory provisions operating in the field, if any.

¶113

8. The respondent worked for a very short period. He only worked, as noticed hereinbefore, in 1994-95. The Industrial Tribunal-cum-Labour Court, therefore, in our opinion committed an illegality, while passing an award in the year 2003, directing the reinstatement of the respondent with full back wages. Although we are of the opinion that the respondent was not entitled to any relief, whatsoever, we direct the appellant to pay him a sum of Rs. 25,000.”

¶114

14. In Uttaranchal Forest Development Corporation v. M.C.Joshi [(2007) 9 SCC 353], the Court was concerned with a daily wager who had worked with Uttaranchal Forest Development Corporation from 01.08.1989 to 24.11.1991 and whose services were held to be terminated in violation of Section 6-N of the U.P. Industrial Disputes Act. The Labour Court had directed the reinstatement of the workman with 50 per cent back wages from the date the industrial dispute was raised. Setting aside the order of reinstatement and back wages, this Court awarded compensation in a sum of Rs. 75,000/- in favour of the workman keeping in view the nature and period of service rendered by the workman and the fact that industrial dispute was raised after six years.

¶115

15. In Madhya Pradesh Administration v. Tribhuban [(2007) 9 SCC 748] , this Court upheld the order of the Industrial Court passed in its jurisdiction under Section 11A of the ID Act awarding compensation and set aside the judgment of the Single Judge and the Division Bench that ordered the reinstatement of the workman with full back wages. The Court in paragraph 12 of the Report held as under (SCC p. 755):

¶116

“12. In this case, the Industrial Court exercised its discretionary jurisdiction under Section 11-A of the Industrial Disputes Act. It merely directed the amount of compensation to which the respondent was entitled had the provisions of Section 25-F been complied with should be sufficient to meet the ends of justice. We are not suggesting that the High Court could not interfere with the said order, but the discretionary jurisdiction exercised by the Industrial Court, in our opinion, should have been taken into consideration for determination of the question as to what relief should be granted in the peculiar facts and circumstances of this case. Each case is required to be dealt with in the fact situation obtaining therein.”

¶117

16. In Mahboob Deepak v. Nagar Panchayat, Gajraula (2008) 1 SCC 575, this Court stated that an order of retrenchment passed in violation of Section 6-N of the U.P. Industrial Disputes Act may be set aside but an order of reinstatement should not however be automatically passed. The Court observed in paragraphs 11 and 12 of the Report as follows (SCC p. 578):

¶118

¶119

“11. The High Court, on the other hand, did not consider the effect of non-compliance with the provisions of Section 6-N of the U.P. Industrial Disputes Act, 1947. The appellant was entitled to compensation, notice and notice pay.

¶120

12. It is now well settled by a catena of decisions of this Court that in a situation of this nature instead and in place of directing reinstatement with full back wages, the workmen should be granted adequate monetary compensation. (See M.P. Admn. v. Tribhuban).”

¶121

17. In Deptt. Of Telecommunications v. Keshab Deb[(2008) 8 SCC 402], this Court said that even if the provisions of Section 25-F of the I.D. Act had not been complied with, the workman was only entitled to just compensation.

¶122

18. In Talwara Co-operative Credit and Service Society Limited v. Sushil Kumar[(2008) 9 SCC 486], this Court in paragraph 8 of the Report held as under (SCC p.489) :

¶123

“8. Grant of a relief of reinstatement, it is trite, is not automatic. Grant of back wages is also not automatic. The Industrial Courts while exercising their power under Section 11- A of the Industrial Disputes Act, 1947 are required to strike a balance in a situation of this nature. For the said purpose, certain relevant factors, as for example, nature of service, the mode and manner of recruitment viz. whether the appointment had been made in accordance with the statutory rules so far as a public sector undertaking is concerned, etc., should be taken into consideration.”

¶124

19. In Jagbir Singh v. Haryana State Agriculture Mktg. Board (2009) 15 SCC 327, this Court, speaking through one of us (R.M. Lodha, J.) while dealing with the question of consequential relief arising from the facts quite similar to the present case, ordered compensation of Rs. 50,000/- to be paid by the employer to the workman instead of reinstatement. In paragraph 14 of the Report, this Court held as under (SCC p.335) :

¶125

“14. It would be, thus, seen that by a catena of decisions in recent time, this Court has clearly laid down that an order of retrenchment passed in violation of Section 25-F although may be set aside but an award of reinstatement should not, however, be automatically passed. The award of reinstatement with full back wages in a case where the workman has completed 240 days of work in a year preceding the date of termination, particularly, daily wagers has not been found to be proper by this Court and instead compensation has been awarded. This Court has distinguished between a daily wager who does not hold a post and a permanent employee.”

¶126

20. In U.P.SEB v. Laxmi Kant Gupta[(2009) 16 SCC 562], this Court stated, (SCC P.564, para 9)

¶127

“…. now there is no such principle that for an illegal termination of service the normal rule is reinstatement with back wages, and instead the Labour Court can award compensation”.

¶128

¶129

21. In Telegraph Deptt. V. Santosh Kumar Seal (2010) 6 SCC 773, while dealing with a case of workmen who were engaged as daily wagers about 25 years back and had hardly worked for two or three years, this Court speaking through one of us (R.M. Lodha, J.) held that reinstatement with back wages could not be said to be justified and instead monetary compensation would subserve the ends of justice. It was held that compensation of Rs. 40,000/- to each of the workmen would meet the ends of justice.

¶130

22. From the long line of cases indicated above, it can be said without any fear of contradiction that this Court has not held as an absolute proposition that in cases of wrongful dismissal, the dismissed employee is entitled to reinstatement in all situations. It has always been the view of this Court that there could be circumstance(s) in a case which may make it inexpedient to order reinstatement. Therefore, the normal rule that dismissed employee is entitled to reinstatement in cases of wrongful dismissal has been held to be not without exception. Insofar as wrongful termination of daily-rated workers is concerned, this Court has laid down that consequential relief would depend on host of factors, namely, manner and method of appointment, nature of employment and length of service. Where the length of engagement as daily wager has not been long, award of reinstatement should not follow and rather compensation should be directed to be paid. A distinction has been drawn between a daily wager and an employee holding the regular post for the purposes of consequential relief.

¶131

23. We shall now consider two decisions of this Court in Harjinder Singh v. Punjab State Warehousing Corpn. (2010) 3 SCC 192 and Devinder Singh vs. Municipal Council, Sanaur (2011) 6 SCC 584 upon which heavy reliance has been placed by the learned counsel for the respondent.

¶132

24. In Harjinder Singh, this Court did interfere with the order of the High Court which awarded compensation to the workman by modifying the award of reinstatement passed by the Labour Court. However, on close scrutiny of facts it transpires that that was a case where a workman was initially employed by Punjab State Warehousing Corporation as work-charge motor mate but after few months he was appointed as work munshi in the regular pay-scale for three months. His service was extended from time to time and later on by one month's notice given by the Managing Director of the Corporation his service was brought to end on 05.07.1988. The workman challenged the implementation of the notice in a writ petition and by an interim order the High Court stayed the implementation of that notice but later on the writ petition was withdrawn with liberty to the workman to avail his remedy under the ID Act. After two months, the Managing Director of the Corporation issued notice dated 26.11.1992 for retrenchment of the workman along with few others by giving them one month's pay and allowances in lieu of notice as per the requirement of Section 25-F(a) of the ID Act. On industrial dispute being raised, the Labour Court found that there was compliance of Section 25-F but it was found that the termination was violative of Section 25-G of the ID Act and, accordingly, Labour Court passed an award for reinstatement of the workman with 50 per cent back wages. The Single Judge of that High Court did not approve the award of reinstatement on the premise that the initial appointment of the workman was not in consonance with the statutory regulations and Articles 14 and 16 of the Constitution and accordingly, substituted the award of reinstatement with 50 per cent back wages by directing that the

¶133

¶134

workman shall be paid a sum of Rs. 87,582/- by way of compensation. It is this order of the Single Judge that was set aside by this Court and order of the Labour Court restored. We are afraid the facts in Harjinder Singh are quite distinct. That was not a case of a daily- rated worker. It was held that Single Judge was wrong in entertaining an unfounded plea that workman was employed in violation of Articles 14 and 16. Harjinder Singh turned on its own facts and is not applicable to the facts of the present case at all.

¶135

25. In Devinder Singh, the workman was engaged by Municipal Council, Sanaur on 01.08.1994 for doing the work of clerical nature. He continued in service till 29.09.1996. His service was discontinued with effect from 30.09.1996 in violation of Section 25-F of ID Act. On industrial dispute being referred for adjudication, the Labour Court held that the workman had worked for more than 240 days in a calendar year preceding the termination of his service and his service was terminated without complying with the provisions of Section 25-F. Accordingly, Labour Court passed an award for reinstatement of the workman but without back wages. Upon challenge being laid to the award of the Labour Court, the Division Bench set aside the order of the Labour Court by holding that Labour Court should not have ordered reinstatement of the workman because his appointment was contrary to the Recruitment Rules and Articles 14 and 16 of the Constitution.

¶136

26.In the appeal before this Court from the order of the Division Bench, this Court in Devinder Singh held that the High Court had neither found any jurisdictional infirmity in the award of the Labour Court nor it came to the conclusion that the award was vitiated by an error of law apparent on the face of the record and notwithstanding these the High Court set aside the direction given by the Labour Court for reinstatement of the workman by assuming that his initial appointment was contrary to law. The approach of the High Court was found to be erroneous by this Court. This Court, accordingly, set aside the order of the High Court and restored the award of the Labour Court. In Devinder Singh, the Court had not dealt with the question about the consequential relief to be granted to the workman whose termination was held to be illegal being in violation of Section 25-F.

¶137

27. In our view, Harjinder Singh and Devinder Singh do not lay down the proposition that in all cases of wrongful termination, reinstatement must follow. This Court found in those cases that judicial discretion exercised by the Labour Court was disturbed by the High Court on wrong assumption that the initial employment of the employee was illegal. As noted above, with regard to the wrongful termination of a daily wager, who had worked for a short period, this Court in long line of cases has held that the award of reinstatement cannot be said to be proper relief and rather award of compensation in such cases would be in consonance with the demand of justice. Before exercising its judicial discretion, the Labour Court has to keep in view all relevant factors, including the mode and manner of appointment, nature of employment, length of service, the ground on which the termination has been set aside and the delay in raising the industrial dispute before grant of relief in an industrial dispute.

¶138

28. We may also refer to a recent decision of this Court in Bharat Sanchar Nigam Limited v. Man Singh [(2012) 1 SCC 558]. That was a case where the workmen, who were daily

¶139

¶140

wagers during the year 1984-85, were terminated without following Section 25-F. The industrial dispute was raised after five years and although the Labour Court had awarded reinstatement of the workmen which was not interfered by the High Court, this Court set aside the award of reinstatement and ordered payment of compensation. In paragraphs 4 and 5 of the Report this Court held as under (SCC p.559):

¶141

“4. This Court in a catena of decisions has clearly laid down that although an order of retrenchment passed in violation of Section 25-F of the Industrial Disputes Act may be set aside but an award of reinstatement should not be passed. This Court has distinguished between a daily wager who does not hold a post and a permanent employee.

¶142

5. In view of the aforementioned legal position and the fact that the respondent workmen were engaged as “daily wagers” and they had merely worked for more than 240 days, in our considered view, relief of reinstatement cannot be said to be justified and instead, monetary compensation would meet the ends of justice.”

¶143

29. In light of the above legal position and having regard to the facts of the present case, namely, the workman was engaged as daily wager on 01.03.1991 and he worked hardly for eight months from 01.03.1991 to 31.10.1991, in our view, the Labour Court failed to exercise its judicial discretion appropriately. The judicial discretion exercised by the Labour Court suffers from serious infirmity. The Single Judge as well as the Division Bench of the High Court also erred in not considering the above aspect at all. The award dated 28.06.2001 directing reinstatement of the respondent with continuity of service and 25% back wages in the facts and circumstances of the case cannot be sustained and has to be set aside and is set aside. In our view, compensation of Rs.50,000/- by the appellant to the respondent shall meet the ends of justice. We order accordingly. Such payment shall be made to the respondent within six weeks from today failing which the same will carry interest @ 9 per cent per annum.”

¶144

6. This trend has been reiterated in Rajasthan State Agriculture Marketing Board vs. Mohan Lal 2013(14) SCC 543, in the following terms:

¶145

“19. We are clearly of the view that though Limitation Act, 1963 is not applicable to the reference made under the I.D. Act but delay in raising industrial dispute is definitely an important circumstance which the Labour Court must keep in view at the time of exercise of discretion irrespective of whether or not such objection has been raised by the other side. The legal position laid down by this Court in Rajasthan Development Corpn. V. Gitam Singh (2013) 5 SCC 136 that before exercising its judicial discretion, the Labour Court has to keep in view all relevant factors including the mode and manner of appointment, nature of employment, length of service, the ground on which termination has been set aside and the delay in raising industrial dispute before grant of relief in an industrial dispute, must be invariably followed.

¶146

20. Now, if the facts of the present case are seen, the position that emerges is this: the workman worked as a workcharged employee for a period from 01.11.1984 to 17.02.1986

¶147

¶148

(in all he worked for 286 days during his employment). The services of the workman were terminated with effect from 18.02.1986. The workman raised the industrial dispute in 1992, i.e., after 6 years of termination. The Labour Court did not keep in view admitted delay of 6 years in raising the industrial dispute by the workman. The judicial discretion exercised by the Labour Court is, thus, flawed and unsustainable. The Division Bench of the High Court was clearly in error in restoring the award of the Labour Court whereby reinstatement was granted to the workman. Though, the compensation awarded by the Single Judge was too low and needed to be enhanced by the Division Bench but surely reinstatement of the workman in the facts and circumstances is not the appropriate relief.

¶149

21. In our opinion, interest of justice will be subserved if in lieu of reinstatement, the compensation of Rs.1,00,000/- (one lac) is paid by the appellant (employer) to the respondent (workman). We order accordingly. Such payment shall be made by the appellant to the respondent within six weeks from today failing which the same will carry interest @ 9% per annum.”

¶150

7. In view of the aforesaid exposition of law, the petitioner should be contended with what has been awarded in his favour as no fault whatsoever can be found with the impugned award. Moreover, the petitioner has already accepted the award without any protest or demonour. There is no explanation what prevented the petitioner from approaching this court for the last seven years. Not only this, based upon the order passed by the tribunal, the petitioner has also accepted his appointment to the temporary post of Beldar on regular basis offered to him vide office order dated 6.5.2010. Therefore, also the petitioner is estopped from filing the present petition.”

¶151

In view of the aforesaid discussion, I find no merit in this petition and accordingly the same is dismissed, leaving the parties to bear their own costs. Pending application, if any, also stands disposed of.

¶152

(Tarlok Singh Chauhan), 2^nd November, 2017. Judge. (krt)

Ramesh Kumar v. M.D.Forest Corporation Ltd.

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Ramesh Kumar v. M.D.Forest Corporation Ltd.

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