Gujarat High Court
Vajesinh Ganpatsinh Raulji vs State Of Gujarat on 28 January, 2025
NEUTRAL CITATION
C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025
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IN THE High Court OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 25783 of 2022
With
R/SPECIAL CIVIL APPLICATION NO. 25789 of 2022
With
R/SPECIAL CIVIL APPLICATION NO. 25790 of 2022
With
R/SPECIAL CIVIL APPLICATION NO. 25786 of 2022
With
R/SPECIAL CIVIL APPLICATION NO. 25784 of 2022
FOR APPROVAL AND SIGNATURE:
HONOURABLE MRS. JUSTICE M. K. THAKKER
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Approved for Reporting Yes No
Yes
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VAJESINH GANPATSINH RAULJI
Versus
STATE OF GUJARAT & ORS.
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Appearance:
SENIOR ADVOCATE MR.SHALIN MEHTA assisted by MS.SHIKHA D
PANCHAL(10764) for the Petitioner(s) No. 1
DELETED for the Respondent(s) No. 1
MR.VARUN K.PATEL(3802) for the Respondent(s) No. 2
NOTICE SERVED BY DS for the Respondent(s) No. 3
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CORAM:HONOURABLE MRS. JUSTICE M. K. THAKKER
Date : 28/01/2025
ORAL JUDGMENT
1. Rule returnable forthwith. Learned advocate Mr.Varun Page 1 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined Patel waives service of Rule on behalf of respondent.
2. With the consent of the parties, the matter was heard finally
3. The petitioners who are employees of respondent no.2, Kalki chemical industries has filed present petitions, challenging the judgement and order dated 27.04.2022 passed in approval Application No.86 of 2018 in Reference IT No.72 of 2018 whereby, Approval Application filed by respondent no.2 came to be allowed and approval to dismissal order dated 18.09.2018 was given.
4. The facts needed for disposal of present case is as under:
4.1. The petitioner, along with other employees working and in respondent no.2 Company raised an industrial dispute which came to be referred to the learned Industrial Tribunal No.2, Vadodara and was numbered as reference IT No.72 of 2018. The dispute was with regard to increment in pay and payment of other allowances. Pending reference, by letter dated 08.02.2018, respondent no.2 has informed to the petitioners that they were suspended with effect from Page 2 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined 08.02.2018 on the ground that petitioner had allegedly misbehaved with an officer of the firm and has participated in and supported an illegal strike. Charge-
sheet dated 14.02.2018 was served alleging that petitioner, while on duty, had misbehaved with senior Company Officer on 21.12.2017, the petitioner had initiated a strike and had instigated workers working with him to join such a strike the workers coming on duty and had stopped them from working. The petitioner was informed that departmental inquiry will be conducted by an independent Officer and was intimated to remain present on 24.02.2018. The petitioner submitted written statement on 23.02.2018 and requested the firm to supply the copies of certain documents in relation to the charge-sheet. The Inquiry Officer had submitted his Inquiry Report on 16.08.2018 with the finding that charges framed against the present petitioners are held to be proved. The show cause notice was issued on 18.02.2018 stating that, on the basis of the inquiry report, respondent no.2 has decided to dismiss the petitioner on the ground of proven misconduct and petitioner was called upon to give his Page 3 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined reply that why he should not be terminated from service. 4.2. On 18.09.2018, service of the petitioner was dismissed and was paid the one month notice pay by cheque. The respondent no.2 filed an approval application in reference under section 32 of the Industrial Dispute Act, 1947. The petitioner raised an objection mainly that petitioner has not been paid complete wages of one month's notice pay and an amount of Rs.210/- towards ESIC and an amount of Rs.150/- towards Professional Tax has been deducted at the time of making payment of one month notice pay to the petitioner. It was contended that as per the provision of section 33(2)(b), no deduction can be made from one month notice pay and as respondent no.2 made illegal deduction, approval application was sought to be rejected. Learned Tribunal, after hearing to the the parties, allowed the applications filed for approval to dismissal order. The same is subject matter of challenge before this Court.
5. Heard learned senior advocate, Mr.Shalin Mehta, along with learned advocate Ms.Shikha.D.Panchal, for the petitioners and learned advocate Mr.Varun.K.Patel for Page 4 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined the respondent.
5.1. Though many grounds were raised in the memo of the petition, however, learned senior advocate Mr.Shalin Mehta has mainly relied on section 32B of the Act, 1947 and submitted that petitioner's wages for one month amounted to Rs.12,000/-, however, at the time of dismissal, he was paid an amount of Rs.11,640/- towards one month notice pay, after making deduction of Rs.210/- towards E.S.I.C (Employees State Insurance Contribution) and Rs.150/- towards Professional Tax. Learned senior advocate Mr.Shalin Mehta relies on the definition of Section 2(R)(R) of the Act, 1947, which defines 'wages' and submitted that as per this section wages do not include (i) any bonus to any contribution paid or payable by employer (ii) any pension fund or provident fund or the benefit of development under any law for the time being in force and (iii), any gratuity payable on the termination of service. It is submitted by learned senior advocate Mr.Shalin Mehta that under section 2(R)(R) of the Act, 1947, it is made clear that wages do not include any contribution paid or payable for the benefit of workmen under any law for time being Page 5 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined in force, which in the present case would be the contribution towards Employee State Insurance and Professional Tax and learned Tribunal committed error in not rejecting the application for approval on the above above ground.
5.2. Learned senior advocate Mr.Shalin Mehta has relied on the decision rendered by the Rajasthan High Court, Jaipur Bench in the case of Dinesh Khare Vs. Industrial Tribunal & Ors., Rajasthan and submitted that respondent no.2 has failed to pay the wages as required by proviso to section 33(2)(B) of the Act in lieu of notice to be paid without deduction of Professional Tax and ESI Contribution and therefore, the application filed by the respondent no.2 for approval under section 33(2)(B) was required to be dismissed. Learned senior advocate Mr.Shalin Mehta submits that, without applying the aforesaid judgment in a proper spirit, order is passed and therefore, same is required to be set aside. 5.3. Learned advocate Mr.Varun Patel appearing for the respondent has relied on the provisions of Employee State Insurance Act and submitted that employer has been foisted with the liability to pay contribution Page 6 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined towards E.S.I.C. Act. It is further submitted that prior to their order of dismissal, such deductions were being made and there was no objection raised by the petitioners to such deduction at any point of time. Failure to comply with the provisions of the E.S.I.C. Act, exposes the respondent to penalties and the prosecution and therefore, being a statutory deduction, employer has to deduct the said amount from the wages. It is further submitted by learned advocate Mr.Varun Patel that when the approval is of dismissal order in respect of proved misconduct, it cannot be withheld only on amount of shortfall of a minor sum which is otherwise accountable on showing total amount which is payable by employer to employee for the month. It is submitted that no straight jacket formula can be applied in respect of all deductions or entitlement of every minor shortfall. Learned advocate Mr.Varun Patel submitted that no error has been committed by learned Tribunal, allowing the application for approval of dismissal. Therefore, no interference is required and petition is required to be dismissed.
6. Having considered the arguments advanced by learned Page 7 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined advocates for the respective parties, the question which fall for consideration in this petition is whether in computing the amount of one month wages, to be paid under section 33(2)(b) of Act, 1947, the employer is justified in deducting the amount by statutory payment of payment under E.S.I.C Act as well as Professional Tax.
7. Before deciding the case on merits. The statutory provisions which come into action leading to answer is required to referred hereinbelow:
Section 2(rr) of the Industrial Disputes Act, 1947 (rr) "wages" means all remuneration capable of being expressed in terms of money, which would, if the terms of employment, expressed or implied, were fulfilled, be payable to a workman in respect of his employment or of work done in such employment, and includes--
(i) such allowances (including dearness allowance) as the workman is for the time being entitled to;
(ii) the value of any house accommodation, or of supply of light, water, medical attendance or other amenity or of any service or of any concessional supply of foodgrains or other articles;
(iii) any travelling concession; 1 [(iv) any commission payable on the promotion of sales or business or both;] but does not include--
(a) any bonus;
(b) any contribution paid or payable by the employer to any pension fund or provident fund or for the benefit of the workman under any Page 8 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined law for the time being in force;
(c) any gratuity payable on the termination of his service;]
8. section 33(2)(b):
"for any misconduct not connected with the dispute, or discharge or punish, whether by dismissal or otherwise, that workman:
Provided that no such workman shall be discharged or dismissed, unless he has been paid wages for one month and an application has been made by the employer to the authority before which the proceeding is pending for approval of he action taken by the employer."
9. In the instant case, the interpretation of the proviso to clause (b) which says that no such workman shall be discharged or dismissed, unless he has been paid wages for one month and an application has been made by the employer to the Authority before which the proceedings is pending for approval of action taken by the employer. We may refer the circumstances in which section 33(2) came to be enacted. Originally there was no such provisions like section 33(2) in the Act and the only provision to be found therein correspondent to the present section 33(1), the object behind enacting section 33 as it was before the amendment of 1956 was to allow continuance of industrial proceedings pending before any authority prescribed by Act in a calm and peaceful Page 9 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined atmosphere undisturbed by any other industrial dispute. The plain object of section was to maintain the status qua as far as possible during pendency of industrial dispute before a Tribunal. It seems to have been felt that section 33, as it stood before amendment of 1956, was too stringent for it completely took away the right of the employer to make any alteration in the condition of service or to make any order of discharge or dismissal without making any distinction as to whether such alteration or such an order of discharge or dismissal was in any manner connected with the dispute pending before an industrial authority. It seems to have been felt therefore that the strangency of the provision should be softened and the employer should be permitted to make changes in the condition etc. which were no connected to the dispute pending before an industrial Tribunal. For the same reasons, it was felt that the Authority of the employer to dismiss or discharge a workman should not be completely taken away where the dismissal or discharge dependent on matter unconnected with the matter pending before the Tribunal. At the same time, it seems to have been felt that some safeguard should be Page 10 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined provided for workman who may be discharged or dismissed during the pendency of dispute on account of same matter unconnected with the dispute.
10. Consequently, section 33 was redrafted in 1956 and considerably expanded. It is now in 5 sub-sections while before 1956 is consisted practically of what is now sub- section 1. The proviso lays down that no workman shall be discharged or dismissed unless he has been paid wages for one month and an application has been made by the employer to the authority before which the proceeding is pending for approval of action taken by the employer. There are two kinds of punishment are subject to the conditions of the proviso namely discharge or dismissal. Further, the proviso lays down two conditions namely (i) payment of wages for one month and (ii) making an application by the employer to the Authority before which the proceedings is pending for approval of action taken.
11. The payment of one month's salary or wages, is to soften the rigour of unemployment that will face the workman, against whom an order of discharge or dismissal, has been passed are conceptually for the month to follow the Page 11 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined month of unemployment and in the context wages for the month following date of dismissal or repetitive wages for the month previous to the date of dismissal. It is undisputed in the instant case that payment of wages is made, however, it is made after statutory deductions. The legal character of months wage would undergo a change depending on result of approval application. If the Tribunal where to refuse the approval the incoherent and incomplete order of discharge and dismissal would end in the legal character of one months wages would transform to be the same as before, from which statutory deductions could legitimately be made by the employer. In the event of approval of the application by the Tribunal the legal character of one month wages would on the other hand would be wages without employment. This is a field in which interest of both the parties is to be kept in view, for the same circumstances would be precarious for the employer if he were not to deduct tax or contribution towards the ESI Act. The same would be exposing him to the dangers of penalties and prosecutions. In the case of statutory tax deductions, his justificatory burden is less, for he has the Page 12 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined shelter of the laws. The employer makes a deductions which are compulsive under the law. Otherwise, not a paisa was kept with him for the legitimate dues of the employee. The Court has to adopt a usual approach in deciding the matter without ignoring the purpose, aim and object of the provision.
12. This Court has referred the decision relief in the case of S.Ganapathy and Ors. versus Air India and Anr. reported in (1993) 3 SCC 429. The judgment which was relied by the learned advocate for the petitioner in the case of Dinesh Khare Vs. Industrial Tribunal & Ors., Rajasthan was also considered by the Apex Court in the case of S.Ganapathy (supra) and the Apex Court has held and observed as under:
"It was the case where the employee of where the case was that the workman was employed in Air India, the approval for his dismissal was not accorded on the ground that one month salary or wages were paid to the employee by reducing some of Rs.15/- as deductible on account of monthly payment of tax on employment, imposed on salary and wage earners, under the provisions of West Bengal State Tax on Professions, Trades, Callings and Employment Rules, 1979. Rejection order when challenged was not sustained by the Bombay High Court. On appeal, affirming order. Passed by the Bombay High Court, the supreme court held that this is a field in which the interest of both parties has to be kept in view, for the situation would be precarious for the employer if he were not to deduct tax under s.Page 13 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025
NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined 4 of the tax act and exposing him to the dangers of penalties and prosecution. If approval was to be rejected on merit and otherwise to be rejected for not making complete payment of one month wage, it would thus be just and proper to let the employer deduct the statutory tax deduction from that one month wage, since the relationship of employer and an employee has effectively not been terminated, to meet the eventuality, let the approval application be dismissed on merit. On the other hand it would be just and proper either for the employer on his own or on the asking of the tribunal to let the sum representing statutory tax deduction be deposited in the tribunal for payment to the workman in the event of the approval application being allowed. In the case of statutory tax deductions, his justificatory burden is less, for he has the shelter of the tax law."
13. In the opinion of this Court, employer has not committed any error in making payment of wages by deducting the amount and learned Tribunal has also assigned detailed reasons while granting the approval of dismissal order, this Court did not find any merit in the submissions made by the learned senior advocate Mr.Shalin Mehta. Hence, this petition deserves to be dismissed.
14. Considering the over all circumstances this Court is of the opinion that learned Tribunal has not committed any error in granting the approval Application No.86 of 2018 in Reference IT No.72 of 2018 and therefore, no interference is called for and the petition being devoid of any merits, deserves to be dismissed.
15. Resultantly, this petition is dismissed. Rule is Page 14 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025 NEUTRAL CITATION C/SCA/25783/2022 JUDGMENT DATED: 28/01/2025 undefined discharged.
(M. K. THAKKER,J) ARCHANA S. PILLAI Page 15 of 15 Uploaded by MRS. ARCHANA SAJEEVKUMAR PILLAI(HC01899) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:48 IST 2025