Gujarat High Court
Gujarat Agro Industries Corporation ... vs Makwana Natubhai Bhailalbhai on 3 July, 2025
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 8619 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MRS. JUSTICE M. K. THAKKER
==========================================================
Approved for Reporting Yes No
==========================================================
GUJARAT AGRO INDUSTRIES CORPORATION LTD & ANR.
Versus
MAKWANA NATUBHAI BHAILALBHAI
==========================================================
Appearance:
MR NIRAV C THAKKAR(2206) for the Petitioner(s) No. 1,2
==========================================================
CORAM:HONOURABLE MRS. JUSTICE M. K. THAKKER
Date : 03/07/2025
ORAL JUDGMENT
1. This petition is filed under Article 226 and 227 of the Constitution of India challenging the order passed by the learned labour court whereby, learned labour court has allowed the recovery application filed under section 33(C)(2) by the respondent whereby, the petitioner was directed to pay the amount of leave encashment of Rs.6,85,620/- with interest at the rate of 8% considering the retirement dated of 31.05.2020 till the recovery and further ordered to pay expenses of Rs.10,000/-.
2. It is the case of the present petitioner that the Page 1 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025 NEUTRAL CITATION C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025 undefined respondent was serving as an in-charge Officer and he completed his 28 years of service and retired on 31.05.2020. At the time of retirement in the leave card of the respondent, there was 300 leave which was credited which was not paid by the respondent, therefore, the application under section 33(C)(2) of the Industrial Disputes Act, 1947 (hereinafter referred to as the "I.D.Act") was filed which was not paid by the present petitioner. Application under section 33(C)(2) of the I.D.Act was filed before the learned labour court, learned labour court, after considering the evidence, more particularly, the cross-examination of the witness of the present petitioner who admitted in his evidence that there were 300 leave credited as stated in the leave card which was withheld by the petitioner without following due procedure of law, has allowed the application filed under section 33(C)(2) of the I.D.Act which is subject matter of challenge before this Court.
3. Heard learned advocate Mr.Nirav.C.Thakkar for the petitioner.
4. Learned advocate Mr.Thakkar submitted that instead of filing the reference with regard to the leave encashment, Page 2 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025 NEUTRAL CITATION C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025 undefined application under section 33(C)(2) of the I.D.Act is filed. It is submitted by the learned advocate Mr.Thakkar that learned court would not have jurisdiction to decide the first claim of the respondent with regard to the entitlement and then to proceed by computing the benefits. Learned advocate Mr.Thakkar submits that the claim which was raised is first required to be adjudicated by the learned reference court under section 10 of the I.D.Act. However, instead of same, application which is in the nature of execution application came to be filed, hence the impugned award deserves to be set aside by allowing the present petition.
5. Having considered the arguments advanced by the learned advocate for the petitioner as well as referring to the reasons assigned by the learned labour court, it emerges from the record that at the time of retirement i.e. on 31.05.2020, payment of leave encashment of 300 days was not made as per the documentary evidence produced below mark 7/1 300 days' leave encashment was in the credit of the leave card. The explanation offered by the present petitioner for withholding the said benefit was with regard to the recovery of the amount Page 3 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025 NEUTRAL CITATION C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025 undefined from one AGRO Industries who has taken goods on credit. It is not disputed by the witness of the present petitioner that no departmental inquiry was initiated, neither any separate order was passed withholding the said benefits.
6. At this stage, reference of the decision rendered by this Court in the case of Ahmedabad Municipal Corporation Versus Sadgunbhai Semulbhai Solanki in Special Civil Application No.12834 of 2018 is required to be referred to which is reproduced herein below:-
"7.1 The gratuity case which was filed by the respondent was also awarded in favour of the respondent by holding that respondent would be entitled for the gratuity amount considering the date of retirement i.e 07.06.2013. Though above order is challenged before the higher forum but is ultimately accepted by the petitioner Corporation and amount is paid to the respondent workman. So far as the claim of unauthorized leave from 07.03.2013 to 30.04.2014 is concerned, it is undisputed that there is no departmental proceedings initiated claiming that this period would be considered unauthorized leave or any intimation was addressed to the respondent to resume duty immediately in absence of deposit of one month notice pay. Claim of the petitioner that he did not pay the one month notice pay is also misconceived as from the application dated 07.03.2013 itself it clarifies that respondent has shown his willingness to deposit Page 4 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025 NEUTRAL CITATION C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025 undefined this amount in the event of acceptance of application. As there was no acceptance for the period of three months no necessity arose for payment of one month notice pay. At this stage, for determining issue with regard to leave encashment period Rule 22 of GCSR, 2002 as well as Rule 63 is required be referred which is reproduced hereinbelow:
"22.Leave at credit to cease on removal or resignation:
(1) Except as provided in rule-63 and this rule, any claim to leave to the credit of a Government employee, who is dismissed or removed or who resigns from Government service, ceases from the date of such dismissal or removal or resignation, as the case may be.
(2) A temporary Government employee who is discharged due to shaliction of establishment and re-employed, the leave at his credit bhall be carried forward provided employed, the leaveservice or the break in service not exceeding thirty days is converted into joining time with or without pay. (3) A Government employee, who is removed or dismissed from service but is re-instated on appeal or revision. shall be entitled to count his service prior to dismissal or removal, as the case may be, for leave.
63.Leave beyond the date of compulsory retirement or quitting of service :
(1) Except as provided hereinafter, no leave shall be granted to a Government employee beyond -
a) the date of his compulsory retirement, or
b) the date of his final cessation of duties, or
c) the date of his resignation from service. (2) Where the service of a Government has been extended in the public interest beyond the date of his compulsory retirement, he Page 5 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025 NEUTRAL CITATION C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025 undefined may be granted earned leave, subject to maximum of three hundred days."
8. As the claim of the respondent is based on certificate issued by the Corporation produced below mark 15/1 it cannot be said that learned Labour Court has committed error in awarding the reference in favour of the respondent. Leave encashment is akin to salary which is property and depriving a person of his property without valid statutory provision is violation of the provision of Constitution of India. If an employee has earned the leave and employee has chosen to accumulate his earned leave to his credit then encashment becomes his right and in absence of any authority that right cannot be infringed by the petitioner Corporation. Considering the same, this Court deems it fit to dismiss the petition being devoid of merits and confirm the order passed by the learned Labour Court in Recovery Application No.558 of 2013 dated 23.01.2018."
7. The decision rendered by this Court was upheld by the Division Bench in the intra court appeal by observing as under:-
"3. Learned advocate Mr. H.S. Munshaw has contended that the order passed by the learned Single Judge and the controlling authority require to be set aside since the respondent employee has tendered his resignation by the communication dated 07.03.2013 to be made effective from 26.03.2013 and he has not paid the amount of Rs.9,090/- towards three months notice pay and hence, the respondent employee would not be entitled to the amount of leave encashment. No further submissions are advanced.
4. The learned Single Judge after recording the above and after Page 6 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025 NEUTRAL CITATION C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025 undefined perusing the impugned order passed by the Labour Court rejected the writ petition. We do not find any illegality in the order passed by the learned Single Judge confirming the award passed by the Labour Court. The award passed by the Labour Court is also just and proper. The learned Single Judge after appreciating the provisions of Rule 49(1)(2) of Gujarat Civil Service (Pension) Rules, 2002 has held that the respondent-AMC done has not accepted or rejected the application filed by the respondent employee after tendering his resignation.
5. It is noticed by us that while tendering the resignation on 07.03.2013, the employee had also clarified that the notice pay of 1/2/3 months will be paid by him. However, the appellant-AMC did not do anything on the resignation and only called upon the respondent employee by the communication dated 07.03.2013 and thereafter, also on 19.10.2013, the employee was informed to pay the aforesaid amount. Thus, if it was the case of the appellant- AMC that the resignation became ineffective for non payment of notice pay, they could have passed appropriate order of refusing to accept. It is also very pertinent to note that the employee has tendered his resignation before he reached the age of superannuation while on reaching the age of 58 years, it was from 30.04.2014, i.e. after a period of 1 year. The respondent employee had tendered his resignation after completion of 57 years and had completed his service from 1975 till the order of 2013, i.e. more than 38 years. The appellant cannot approbate and reprobate. Curiously, the stand of the appellant-AMC is that the resignation tendered by the respondent-employee cannot be accepted, and simultaneously, he is allowed to retire at the age of 57 years, without extending the benefit of leave encashment. In case, his resignation was not found suitable for acceptance, then as a Page 7 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025 NEUTRAL CITATION C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025 undefined necessary sequel, he has to be treated as retired on superannuation with the benefit of leave encashment. There is no provision pointed before us that in case an employee resigns, he would not be entitled to the amount of leave encashment.
6. Thus the present appeal is devoid of merits and fails. We further clarify that we have not expressed any opinion on the resignation tendered by the respondent-employee."
8. The second ground on which the petition is filed i.e. regarding the jurisdiction of the learned Labour Court to entertain the application filed under Section 33-C(2) of the Industrial Disputes Act,1947, this issue is also decided by the Division Bench of this Court in L.P.A. No.1653 of 2017 in the judgment dated 30.07.2019 wherein following observations are made in para 4:
"4. Having heard learned advocates appearing for the respective parties, we are not inclined to entertain the present appeals when the issue involved in present appeals has already been heard and decided by this Court by way of order dated 07.05.2018 rendered in Letters Patent Appeal No. 558 of 2018. Paragraph no. 3 of the said order reads as under: "3. We have perused the order passed by the Labour Court as well learned Single Judge and circular dated 2.12.2015 applicable in the case of workman. Even objections raised and reply filed by the employer in the application filed under Section 33 (C) (2) of I.D.Act, 1947 towards claim of leave encashment and interest etc., and other resolutions including that of 17.10.1988, we find that it is not in dispute that on completion of number of years of service so envisaged in the Page 8 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025 NEUTRAL CITATION C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025 undefined G.R. Dated 17.10.1988 namely, 15, 20 and 25 years w.e.f. 1.10.1988 such rojamdar/workman is entitled for various benefits available to the regular and permanent employee. Even DCRG and pension is also available to such employees. We find no reason that such workman should not be entitled for leave encashment available to other employees and accordingly, we do not find any reason to interfere with the order impugned passed by learned Single Judge."
9. Considering the above decisions, this Court is of the view that merely denial of the right by the employer may not be sufficient to negate the claim made under Section 33-C(2) of the Industrial Disputes Act, 1947 before the learned Labour Court and would not take away the jurisdiction of the learned Labour Court. The jurisdiction of the learned Labour Court is not confined to the admitted claim and existing rights does not mean any admitted rights, it only means that right to claim exist and vested with the workman.
10. In view of the above, this Court did not find any substance in the merits of the present petition, hence this petition deserves to be dismissed.
11. Resultantly, this petition is dismissed.
(M. K. THAKKER,J) NIVYA A. NAIR Page 9 of 9 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Fri Jul 04 2025 Downloaded on : Sat Jul 05 02:28:38 IST 2025