Keru Kisan Rokade vs Geoffery Manners & Co. Ltd.
2010 Latest Caselaw 136 Bom

                                                                  WP/6513/1998
                                   :1:

                IN THE HIGH COURT OF JUDICATURE AT BOMBAY




                                                                       
                      CIVIL APPELLATE JURISDICTION
                      WRIT PETITION NO.6513 OF 1998




                                               
    Keru Kisan Rokade                              ..       Petitioner
           V/s.
    Geoffery Manners & Co. Ltd., Nasik             ..       Respondent




                                              
    Mr. M.S. Karnik with Mr. H.M. Inamdar
    for the Petitioner.
    Mr. J.P. Cama, Sr. Advocate, i/b.




                                        
    Crawford Bayley & Co., for the
    Respondent.           
                         CORAM           :SMT. NISHITA MHATRE, J.
                         
                         RESERVED ON     :21ST SEPTEMBER, 2010.

                         PRONOUNCED ON :29TH OCTOBER, 2010.
           


    JUDGMENT:

1. The Award in Reference (IDA) No.48 of 1991 passed by

the Presiding Officer, Labour Court, Nasik on 5th January,

1998 has been challenged in this Writ Petition. The said

Reference has been dismissed.

2. The petitioner was initially appointed on a temporary

basis with the respondent-Company. Although his appointment

was for a fixed period, he was continued in service from

time to time. According to the petitioner, he worked for

several years without being made permanent. His services

were terminated by the respondent on 5th September, 1989.

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The petitioner, therefore, approached the machinery

available under the Industrial Disputes Act, 1947, (for

short "the I.D. Act"), and obtained a Reference for

adjudication of his dispute with respect to reinstatement

with continuity of service and back-wages.

3. In his statement of claim, the petitioner pleaded

inter alia that heig had worked continuously with the

respondent from 4th August, 1984 to 4th September, 1989 and

had put in more than 240 days in each year of service. He

contended that his services were terminated without

following the due process of law. According to him, he has

not been paid any retrenchment compensation, nor wages in

lieu of notice prior to terminating his services.

4. The respondent contested the claim of the petitioner

and contended that the appointment orders issued to the

petitioner from time to time were for fixed periods of

time. These orders were issued depending on the specific

exigencies of work. The respondent contended that the non

renewal of the contract of employment for the period from

6th May, 1989 to 5th September, 1989 could not amount to

termination of service which should be preceded by payment

of retrenchment compensation.

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5. The petitioner examined himself before the Labour

Court in support of his demands. The Personnel Officer of

the respondent deposed on its behalf. The Labour Court

after considering the evidence on record and hearing the

parties has dismissed the Reference (IDA) No.48 of 1991.

The Labour Court has found that the order terminating the

services of the petitioner was justified and therefore the

petitioner was not entitled to reinstatement with

continuity of service and full back-wages.

6. Mr. Karnik, the learned Advocate appearing for the

petitioner, pointed out that the appointment orders which

were issued to the petitioner-workman from 13th March, 1986

onwards indicated that the petitioner was being appointed

because of exigencies of work. His services were terminated

within 15 days and he was reappointed on 8th June, 1986,

again for a period of one month. After completion of that

period of one month, he was appointed immediately

thereafter without a break for another period of 2½ months.

An order of termination was issued to him again on 5th

December, 1986. Then from 8th September, 1988, he worked

continuously till 5th September, 1989, albeit with

different appointment letters being issued to him during

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this period. There was no break in service during this

period, according to Mr. Karnik, and in any case the

petitioner had completed 240 days in service during the 12

months preceding his date of termination i.e. 5th

September, 1989. Mr. Karnik then submitted that the salary

slips which were produced on record indicate that there was

no break in service during this period and therefore it was

established before the Labour Court that the petitioner-

workman had completed 240 days in service. Mr. Karnik

submitted that the fresh appointment orders were issued to

the petitioner-workman from time to time only in order to

avoid making him permanent. He also drew my attention to

the fact that the pay slips which were filed before the

Labour Court indicated that the petitioner-workman had not

only worked for 303 days from September, 1988 to September,

1989, but had also worked overtime during this period.

Mr. Karnik submitted that there was no question of the

employment being for a fixed term, as envisaged under

Section 2(oo)(bb) of the I.D. Act, as contended by the

respondent. According to him, the very fact that several

appointment orders were issued to the petitioner-workman

indicated that the work was of a perennial nature and that

he had been deprived of the benefits of permanency.

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7. Mr. Cama, the learned Counsel appearing for the

respondent, submitted that the petitioner had willingly

accepted the short term employments. These terms of

employment indicated the duration of employment, at the end

of which the petitioner-workman was liable to be terminated

from service. According to Mr. Cama, these were fixed term

appointments and the termination of service at the end of

the term could not be considered as retrenchment but falls

within the exception carved out to Section 2(oo), namely,

Section 2(oo)(bb) of the I.D. Act. Mr. Cama, therefore,

submitted that the fact that the petitioner-workman had put

in 240 days of service in the preceding 12 calendar months

prior to his termination of services is irrelevant in a

fixed term employment and therefore Section 25F of the I.D.

Act has no application. He termed the petitioner as an

"unscrupulous workman who had accepted employment on a

fixed term with eyes open". The petitioner-workman,

therefore, cannot contend now that the termination of

service was bad in law, urged Mr. Cama.

8. Both the learned Counsel have referred to several

judgments which I will presently advert to. The fact that

the petitioner had worked for more than 240 days in the 12

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preceding calendar months prior to termination of services

is not disputed. However, the Labour Court has found that

the non renewal of the contract of employment after 5th

September, 1989 was not a termination of service which fall

within the ambit of Section 2(oo) of the I.D. Act.

9. In the case of M. Venugopal vs. Life Insurance

Corporation of India, Machilipatnam, A.P. & Anr., reported

in 1994 I CLR 544, the Supreme Court was dealing with a

case where the services of a probationer had been

terminated because he did not fulfill the targets

stipulated in his letter of appointment.These targets were

with regard to the performance of the workman during the

period of probation stipulated in Regulation 14 of the Life

Insurance Corporation of India (Staff Regulations),1960.

The workman in that case had not achieved these performance

targets and, therefore, it was held that the termination of

a probationer in such circumstances would be covered by the

exception contained in Clause (bb) of Section 2(oo) of the

I.D. Act. The Supreme Court further observed that where no

stipulation is provided or prescribed in the contract of

employment, such a contract shall not be covered by Clause

(bb) of Section 2(oo) of the I.D. Act. In the case before

it, the Court noted that the termination of service of the

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employee was as a result of the contract of employment

having been terminated under the stipulations specifically

provided under Regulation 14 and the order of appointment.

In this background, the non compliance of the requirement

of Section 25F of the I.D. Act did not vitiate or nullify

the order of termination of service of the employee. This

judgment which has been cited by Mr. Cama has no

application in the present case. The contract of employment

in the present case did not require the worker to achieve a

particular target for satisfactorily completing the period

of probation. In the present case the petitioner-worker was

appointed on a temporary basis and not on probation and,

therefore, this judgment has no application.

10. In the case of Alexandar Yesudas Maikel vs. Perfect

Oil Seals and IRP & Ors., reported in 1996 I LLJ 533, a

learned Single Judge of this Court (B.N. Srikrishna, J., as

he then was) has opined that Section 2(oo)(bb) of the I.D.

Act has been restrictively interpreted and the judicial

consensus appeared to be that if the post continues and the

work continues, clause (bb) cannot be said to operate as a

charter for unscrupulous employers to jettison their

workmen. The learned Judge has relied on several judgments

including in the case of Dilip Hanumantrao Shirke & Ors.

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vs. Zilla Parishad, Yavatmal & Ors., reported in 1990 I

LLJ 445. It appears however the judgment in M. Venugopal's

case was not brought to the notice of the Court.

11. However, in the case of Maharashtra State Electricity

Board vs. Suresh Vaidyanath Pagar & Anr., reported in 1995

II CLR 1046, Srikrishna, J. after considering the judgment

of the Supreme Court in the case of M. Venugopal (supra)

held that the view taken in the case of Dilip Hanumantrao

Shirke & Ors. (supra) must be held to be impliedly

overruled. The learned Judge therefore followed the

interpretation placed by the Supreme Court on the

provisions of Section 2(oo)(bb) of the I.D. Act in the case

of M. Venugopal (supra) and held that the termination of

services of the workmen in the case before him was a

consequence of non fulfillment of certain stipulations

incorporated in the letters of appointment. The learned

Judge therefore was of the view that the termination of

service falls squarely within the exception contemplated by

Clause (bb) of Section 2(oo) of the I.D. Act.

12. In the case of Executive Engineer, District Panchayat

Bharuch vs. Shankarbhai Jivabhai Patel, reported in 2006

II CLR 1027, a learned Single Judge of the Gujarat High

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Court after considering various judgments of the Supreme

Court on the interpretation of Section 2(oo)(bb) of the

I.D. Act has held that the very fact that the workman was

continued in service without a break for more than four

years indicated that the work performed by the workman was

of a perennial nature and, therefore, the provisions of

Section 2(oo)(bb) of the I.D. Act would not apply.

13. In the present case, a few appointment letters have

been annexed to the Petition. The appointment letters do

not indicate any stipulations which are required to be

fulfilled by the workman. The only condition in the

appointment letters is as follows :

"5. It must be clearly understood that your

fixed period of appointment will automatically come to an end or be terminated without notice or compensation

on the expiry of the period as stipulated in clause 1 above. However, should it be deemed necessary, your contract will be terminated earlier without notice and without assigning any reason whatsoever."

14. Therefore, M. Venugopal's case does not apply to the

facts in the present case. Mr. Cama, the learned Counsel

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for the respondent, has submitted that the workman was

employed for a fixed period due to exigencies of work. He

was employed only for execution of certain contracts

obtained by the Company and, therefore, must be considered

to be employed on a project for a fixed period of time. In

the case of S.M. Nilajkar & Ors. vs. Telecom District

Manager, Karnataka, reported in (2003) 4 SCC 27, the

Supreme Court has laid down certain criteria which could be

considered to ascertain whether a workman is engaged in a

scheme or project and whether the termination of service of

such a workman would fall within Clause (bb) of Section

2(oo) of the I.D. Act. The Supreme Court has observed thus:

"The termination of service of a workman engaged in a scheme or project may not amount to

retrenchment within the meaning of sub-clause (bb) subject to the following conditions being satisfied :

(i).that the workman was employed in a project or scheme of temporary duration;

(ii).the employment was on a contract, and not as a daily-wager simpliciter, which provided inter alia that the employment shall come to an end on the expiry of the scheme or project;

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(iii).the employment came to an end

simultaneously with the termination of the scheme or project and consistently with the terms of the

contract; and

(iv).the workman ought to have been apprised or

made aware of the abovesaid terms b y the employer at the commencement of employment.

The engagement of a workman as a daily-wager

does not by itself amount to putting the workman on notice that he was being engaged in a scheme

or project which was to last only for a particular length of time or upto to the occurrence of some event, and therefore, the

workman ought to know that his employment was short-lived. The contract of employment

consciously entered into by the workman with the employer would result in a notice to the workman on the date of the commencement of the employment

itself that his employment was short-lived and as per the terms of the contract the same was liable to termination on the expiry of the contract and

the scheme or project coming to an end. The workman may not therefore complain that by the act of employer his employment was coming to an abrupt termination. To exclude the termination of a scheme or project employee from the definition of retrenchment it is for the employer to prove the abovesaid ingredients so as to attract the applicability of sub-clause (bb) abovesaid. In the case at hand, the respondent-employer has

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failed in alleging and proving the ingredients of

sub-clause (bb), as stated hereinabove. All that has been proved is that the appellants were

engaged as casual workers or daily-wagers in a project. For want of proof attracting applicability of sub-clause (bb), it has to be

held that the termination of the services of the appellants amounted to retrenchment." [Emphasis supplied].

15. The respondent has not placed any evidence on record

indicating that the petitioner was appointed on a

particular scheme or project. Therefore, the petitioner

cannot be considered a project employee whose termination

from service falls within the mischief of Section 2(oo)(bb)

of the I.D. Act.

16. Mr. Cama was at pains to point out that the employment

of the petitioner was purely a contractual employment and

the completion of 240 days in service would make no

difference to the termination of service if it is for a

fixed period of time. He relied on the judgment in the case

of Harmohinder Singh vs. Kharga Canteen, Ambala Cantt.,

reported in (2001) 5 SCC 540, in support of his submission.

The Supreme Court noted that the basic question which arose

in the Appeal was whether an employee's service can be

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terminated in accordance with the Standing Orders

introduced subsequent to his entering into service. The

issue was whether a notice under Section 9A of the I.D. Act

was required to be furnished on the employee when such a

term was introduced in the Standing Orders. The Court noted

that the termination of service was as a result of

superannuation and in these circumstances it observed that

the services of a workman can be terminated on the expiry

of the contract of service under Section 2(oo)(bb) of the

I.D. Act without following the principles of natural

justice.

17. Mr. Cama has argued that the respondent is an

unscrupulous workman who had accepted employment with his

eyes open and knowing full well that it would be for a

fixed term. He cannot therefore now contend that the

termination of service is bad in law. The initial

appointment of the petitioner was on 13th March, 1986,

wherein there was a stipulation that the appointment was

being made on a temporary basis and that the respondent

would not be entitled to a permanent employment. Less than

a month thereafter, a letter was issued to the workman

indicating that his services have been terminated. A fresh

letter of appointment was issued on 8th June, 1986, wherein

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it was mentioned that the period of appointment would be

for two months. It was also mentioned that his appointment

would be subject to the rules and regulations / Standing

Orders of the Company. This appointment order came to an

end and a termination order was issued on 8th July, 1986,

even prior to the completion of two months period for which

the petitioner was appointed. A fresh order of appointment

was issued on 13th July, 1986 within the period of two

months fixed in the letter of appointment dated 8th June,

1986. The employment was to continue upto 30th September,

1986. The stipulation contained in the letter again

mentioned that the petitioner was appointed as a temporary

workman and would not be entitled to permanency. Soon

thereafter, the order of termination of service was passed

on 19th August, 1986. A fresh order of appointment for 2½

months was issued on 5th December, 1986. Several such

appointment orders were issued to the workman, the last of

which appears to have been issued on 6th May, 1989 for a

period of two months i.e. from 6th May, 1989 to 15th July,

1989. Again a stipulation contained in the letter was that

the appointment being temporary in nature would

automatically cease without notice or compensation on the

expiry of the period stipulated in the letter. The workman,

it appears, was continued in service right upto 4th

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September, 1989 on which date his services came to an end.

In my opinion, the contention of Mr. Cama that these

appointments are for a fixed term is unsustainable. The

workman has been continued in service over many years by

continuously issuing appointment orders for a month or two.

There is evidence on record to indicate that work was

available with the respondent. In any case, the petitioner-

    workman    has   completed
                            ig   240      days    in    service          in     the      12

preceding calendar months. The appointment letters were

merely a ruse of the employer to get out of the clutches of

Section 25F of the I.D. Act which mandates the payment of

compensation in case it terminates the services of the

workman. It is difficult to appreciate the submission of

Mr. Cama that the employment of the workman was on a

contractual basis and, therefore, the provisions of Section

25F of the I.D. Act had no application.

18. Accordingly, the Award in Reference (IDA) No.48 of

1991 passed by the Presiding Officer, Labour Court, Nasik

on 5th January, 1998 is set aside.

19. The petitioner-workman is entitled to reinstatement

with continuity of service. However, it would be necessary

to remand the Reference (IDA) No.48 of 1991 to the Labour

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Court, Nasik, for quantification of the back-wages payable

to the workman.

20. Accordingly, the Reference (IDA) No.48 of 1991 is

remanded to the Labour Court, Nasik, for determining the

back wages payable to the workman.

21. Parties are permitted to lead evidence on this count.

The Labour Court, Nasik, will decide this issue within a

period of three months from today.

22. Rule is made absolute accordingly.

23. No order as to costs.