[Cites 11, Cited by 0]
Bombay High Court
M/S. Premsons Trading Pvt Ltd vs Hiraprasad Bindeshwar Yadav on 17 March, 2026
Author: Amit Borkar
Bench: Amit Borkar
2026:BHC-AS:12850
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Shabnoor
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 15103 OF 2024
SHABNOOR M/s. Premsons Trading Private Limited,
AYUB
PATHAN 63, Premsons House B, Desai Road,
Digitally signed
by SHABNOOR
Breach Candy, Mumbai - 400 026 ... Petitioner
AYUB PATHAN
Date: 2026.03.17
12:30:21 +0530
V/s.
Hiraprasad Bindeshwar Yadav,
C/o. Maharashtra Employees' Union,
Kokanipada, Kurar Vilage, Malad (E),
Mumbai - 400 097. ... Respondent
Mr. Shailesh S. Pathak, for the Petitioner.
Ms. Seema Chopda, for Respondent.
CORAM : AMIT BORKAR, J.
RESERVED ON : MARCH 5, 2026
PRONOUNCED ON : MARCH 17, 2026
JUDGMENT:
1. By the present Petition instituted under Article 227 of the
Constitution of India, the Petitioner assails the Award dated 29
April 2024 passed by the 8th Labour Court at Mumbai in Reference
(IDA) No. 74 of 2017. By the said Award, the Labour Court partly
allowed the reference and directed the Petitioner to reinstate the
Respondent in service with continuity and to pay 60% back wages
with effect from 17 August 2015.
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2. The Petitioner contends that the Respondent was engaged in
its establishment in the year 2013 as a Sales Person and was
assigned the work of collecting orders for the Petitioner's products
from various customers. The Petitioner disputes the case of the
Respondent that he had been in continuous employment since the
year 1994 as a Delivery Boy. It is further the case of the Petitioner
that the services of the Respondent were never terminated with
effect from 17 August 2015 as alleged, nor was any oral
termination communicated by Mr. Dheeraj Premji Gala, who is
stated to be the Director of the Petitioner Company. According to
the Petitioner, the Respondent himself remained absent from duty
from 14 April 2015 without any authorization. It is stated that
despite several communications issued by the Petitioner calling
upon the Respondent to resume duties, he failed and neglected to
report for work. The Petitioner asserts that the Respondent
remained absent from 14 April 2015 to 29 May 2015, that is for a
period of approximately forty five days, on the ground that he had
travelled to his native place. On this basis, the Petitioner submits
that the allegation of termination of service by the management
does not arise.
3. The Petitioner further contends that Premson Trading Pvt.
Ltd. and Premsons Bazaar are separate and distinct legal entities.
It is the case of the Petitioner that the Respondent was in fact
engaged by Premsons Bazaar and not by the present Petitioner. In
support of this contention, reliance is placed upon Form-16
produced by the Respondent himself, which indicates Premsons
Bazaar as the employer. The Petitioner further states that on 22
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August 2015 the Respondent addressed a demand letter alleging
illegal termination of service and calling upon the Petitioner to
reinstate him with continuity of service and full back wages with
effect from 17 August 2015. The Respondent also stated that in the
event of failure to comply with the demand he would initiate legal
proceedings. Thereafter, on 19 September 2015, the Respondent
filed a Justification Statement before the Deputy Commissioner of
Labour alleging that his services had been terminated and seeking
reinstatement with continuity of service and full back wages. In
the said Justification Statement, the Respondent admitted that
from the year 2011 onwards his wages were being paid by M/s.
Premsons Bazaar. The Petitioner, by its letter dated 08 February
2016, denied the allegations made by the Respondent and
reiterated that the Respondent's services had never been
terminated. It was asserted that the Respondent had voluntarily
remained absent from duty since 14 April 2015. The Respondent,
however, refuted this position by his reply dated 09 February 2016
and reiterated his demand for reinstatement in service. The
Petitioner thereafter filed its reply to the Justification Statement on
23 May 2016 reiterating that the Respondent had voluntarily
absented himself from duty.
4. The Petitioner submits that the Conciliation Officer, without
proper application of mind and without undertaking the
investigation contemplated under the Industrial Disputes Act,
issued a Failure Report dated 30 August 2016. On the basis of the
said report, the appropriate Government by order dated 22
February 2017 referred the alleged industrial dispute for
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adjudication to the Labour Court under Section 12(5) of the
Industrial Disputes Act. Pursuant thereto, the Respondent filed his
Statement of Claim before the Labour Court on 19 September
2017, wherein he again admitted that his wages were paid by
Premsons Bazaar. The Petitioner thereafter filed its Written
Statement dated 24 October 2017 before the Labour Court
denying the allegations made in the Statement of Claim. The
Petitioner reiterated that the Respondent had voluntarily remained
absent from duty since 14 April 2015 and that his services were
never terminated. During the course of evidence, the Respondent
filed an Affidavit in Lieu of Evidence. In his cross examination he
admitted that he was employed by Premsons Bazaar and relied
upon Form-16 which reflected Premsons Bazaar as his employer.
The Petitioner subsequently led evidence through its witness, who
was cross examined in the year 2023. During such cross
examination it was stated that the Respondent had at all times
been permitted to resume duties, since his services had never been
terminated by the management. The Respondent also placed on
record Form-16 issued by Premsons Bazaar dated 22 March 2022.
Thereafter, the Petitioner filed an application dated 23 January
2024 seeking to place on record various correspondences
exchanged between the parties.
5. Thereafter, by letter dated 17 February 2024, the Respondent
once again alleged that his services had been illegally terminated.
The Petitioner by its letter dated 20 February 2024 informed the
Respondent that the management had decided to permanently
close its operations pursuant to a notice dated 21 December 2022
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issued under Section 25-FFA of the Industrial Disputes Act and
therefore directed him not to report for duty. The Petitioner also
placed on record several correspondences to demonstrate that the
Respondent had been permitted to resume duties but had failed to
do so. It is further the case of the Petitioner that the Respondent
reported at the premises on 22 January 2024. However, according
to the Petitioner, he created disturbance at the establishment and
thereafter left the premises within a short time. The Respondent
thereafter addressed further communications seeking leave and
alleging that he was not permitted to resume duties. The Petitioner
denied these allegations and also issued a warning memorandum
dated 27 February 2024 on account of the Respondent's
unauthorized absence. The 8th Labour Court at Mumbai, upon
hearing the parties in Reference (IDA) No. 74 of 2017, passed the
Award dated 29 April 2024 partly allowing the reference and
directing the Petitioner to reinstate the Respondent with continuity
of service and to pay 60% back wages with effect from 17 August
2015. The Petitioner states that even thereafter the Respondent
continued to raise frivolous disputes and remained irregular in
attending duties. Being aggrieved by the said Award dated 29 April
2024 passed by the 8th Labour Court at Mumbai, the Petitioner
has filed the present Petition before this Court.
6. The learned Advocate appearing on behalf of the Petitioner
submitted that the appropriate Government, namely the
Government Labour Officer, ought to have conducted a proper
inquiry and applied its mind to the allegations made by the
Respondent workman before referring the dispute for adjudication.
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It was contended that by letter dated 08 February 2016 the
Petitioner had specifically denied the allegation that the services of
the Respondent were terminated and had clearly asserted that the
Respondent had remained absent from duty of his own accord. In
these circumstances, it was submitted that the appropriate
Government was required to verify the nature of the allegations
and undertake a preliminary scrutiny before making a reference.
According to the Petitioner, the reference was made mechanically
without due consideration of the material placed on record. It was
further submitted that the appropriate Government failed to take
note of the fact that the Respondent himself had admitted that his
wages were being paid by M/s. Premsons Bazaar and not by the
present Petitioner Company. According to the Petitioner, this
admission clearly indicates that there was no employer and
employee relationship between the Petitioner and the Respondent.
On this basis it was argued that the reference of the dispute
against the Petitioner was erroneous and contrary to law. The
learned Advocate submitted that when there was no material
showing termination of service and when the Respondent had
admittedly remained absent from duty, the reference itself ought
not to have been made.
7. The learned Advocate further submitted that the appropriate
Government ought to have considered that Premsons Bazaar and
Premson Trading Pvt. Ltd. are separate and distinct legal entities. It
was argued that if any dispute existed, it ought to have been
referred against Premsons Bazaar, which according to the
Respondent's own case was paying his salary. Attention was invited
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to paragraphs 2, 3 and 4 of the Justification Statement filed by the
Respondent before the Conciliation Officer, wherein the
Respondent had clearly admitted that his salary was being paid by
Premsons Bazaar and not by the Petitioner Company. It was
therefore submitted that the Labour Court failed to appreciate that
the Petitioner had never terminated the services of the Respondent
with effect from 17 August 2015 and that the Respondent had
voluntarily remained absent from duty from 14 April 2015 despite
several communications calling upon him to resume duties. It was
also contended that the learned Labour Court failed to properly
appreciate the evidence led on behalf of the Petitioner. In
particular, reliance was placed upon the cross examination of the
Petitioner's witness dated 09 January 2024 wherein it was
categorically stated that the Respondent was permitted to resume
his duties. It was further submitted that the Petitioner had called
upon the Respondent to report for duty by letters dated 10 January
2024 and 12 January 2024. However, according to the Petitioner,
the Respondent did not comply with the said communications and
instead proceeded to make unfounded allegations against the
Petitioner. The learned Advocate further argued that although
Premsons Bazaar may be described as a sister concern of Premson
Trading Pvt. Ltd., both establishments are separate and
independent legal entities. On this basis it was submitted that the
reference made against the Petitioner Company itself was not
maintainable in law and that the Labour Court ought to have
dismissed the reference on this ground alone.
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8. In support of the aforesaid submissions, reliance was placed
on several decisions, namely, M/s. Purafil Engineer, Pune v.
Shaikkh Anwar Abdul Rahman, 1999 SCC OnLine Bom 876; R.K.
Kitchen Equipments, Mumbai v. Majid Yusuf Hurape & Ors. , 2003
SCC OnLine Bom 1245; Competition Printing Press, Mumbai v.
Shri Jaiprakash Singh & Anr., 2002 (1) L.L.N. 727; Sonal Garments
v. Trimbak Shankar Karve, 2003 (1) L.L.N. 91; Raju Shankar
Poojary v. Chembur Warehouse Company & Anr., 2003 (4) L.L.N.
616; Suja Agencies v. Uday Singh B. Rawat & Anr. , 2003 (4) L.L.N.
1218; Milestone (Franki Stall), Mumbai v. Mathew D'souza & Anr. ,
2010 (6) Mh.L.J. 796; Vilas Ganpati Patil v. Suyog Backwell
Vasantdada Audyogik Vasahat, Sangli & Anr., 2018 (6) Mh.L.J.;
Extrusion Process Ltd. v. Rajendra A. Sav & Anr. , 2004 (3) L.L.N.
996; M/s. Zoom Communications Ltd. v. Sharad Dipchand Patil
(Writ Petition No.15687 of 2022 decided on 09 February 2024);
and Kanga & Co. v. State of Maharashtra & Ors. (Writ Petition
No.2451 of 2006 decided on 13 October 2006).
9. The learned Advocate appearing for the Respondent invited
the attention of the Court to the documentary evidence placed on
record and submitted that the same establishes the employment of
the Respondent with the Petitioner. It was pointed out that the
copy of Form-16 issued to the Respondent mentions his
designation as Driver and reflects the name of the employer as
Premsons Bazar. However, the witness examined on behalf of the
Petitioner admitted in his evidence that Premsons Bazar is a sister
concern of M/s. Premsons Trading Pvt. Ltd. It was further admitted
that in certain circumstances the cashier of Premsons Bazar used to
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make payment of salaries to the employees of the Petitioner
Company. The learned Advocate also relied upon the Provident
Fund receipt produced at Exhibit U-12, which according to the
Respondent demonstrates that he was an employee of the
Petitioner. On the basis of the oral and documentary evidence, it
was therefore submitted that the Respondent was working in the
establishment of the Petitioner as well as in its sister concern
Premsons Bazar. It was further submitted that the Respondent had
issued a demand notice dated 22 August 2015 to the Petitioner
alleging illegal termination. According to the Respondent, no reply
was given by the Petitioner to the said demand notice. The
Respondent has also sought to establish that he had availed leave
for a period of forty five days from 04 April 2015 to 29 May 2015.
It was contended that after the said period of leave the Respondent
reported for duty with the intention of resuming his work,
however he was not permitted to do so by the Petitioner. The
issuance of the demand notice dated 22 August 2015 was
therefore relied upon to show that the Respondent was willing to
resume his duties.
10. The learned Advocate for the Respondent further submitted
that although the witness of the Petitioner expressed before the
Court that the Respondent could resume his duties, the
Respondent had in fact addressed several letters dated 10 January
2024, 18 January 2024, 22 January 2024 and 17 February 2024
stating that the management of the Petitioner was not permitting
him to report for duty. These communications were relied upon to
demonstrate that the Respondent had consistently shown readiness
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to join work but was not allowed to do so by the management. It
was further contended that the evidence on record shows that no
show cause notice or charge sheet was ever issued to the
Respondent by the Petitioner for the alleged unauthorized
absenteeism. According to the Respondent, if the Petitioner was of
the view that the Respondent had remained absent from duty
without authorization, it was incumbent upon the Petitioner as the
employer to initiate disciplinary proceedings by issuing an
appropriate show cause notice or charge sheet. The failure of the
Petitioner to initiate any such disciplinary action in relation to the
alleged absenteeism was therefore relied upon to suggest that the
Petitioner did not intend to permit the Respondent to resume his
duties.
REASONS AND ANALYSIS:
11. This Court has carefully considered the rival submissions
advanced on behalf of both sides and has also examined the
material placed on record. When the entire controversy is viewed
in a proper manner, the dispute really turns around two questions
which require examination. The first question is whether the
industrial dispute was properly and legally referred for
adjudication against the Petitioner. The second question is whether
the Labour Court was justified in directing reinstatement of the
Respondent with continuity of service and payment of 60 percent
back wages with effect from 17 August 2015.
12. The first objection raised by the Petitioner relates to the
reference of the dispute itself. The Petitioner argues that the
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appropriate Government referred the dispute for adjudication
without conducting a proper preliminary inquiry. In this
connection reliance is placed on the letter dated 08 February 2016
issued by the Petitioner in which the allegation of termination was
clearly denied. In that letter it was specifically stated that the
Respondent had voluntarily remained absent from work. The
submission of the Petitioner is that once such a clear stand was
taken, the Government ought to have examined the matter more
carefully before making a reference.
13. There can be no dispute that before referring an industrial
dispute under Section 12(5) of the Industrial Disputes Act the
Government is expected to apply its mind to the material placed
before it. The law does not contemplate a mechanical reference.
The authority must at least look into the nature of the dispute and
see whether there exists a industrial dispute requiring
adjudication. However, the matter cannot be examined in a
technical manner. The Government at that stage does not conduct
a full trial. Its task is to see whether a dispute exists and whether
the matter should be examined by the adjudicating authority. In
the present case the record shows that the Respondent had filed a
Justification Statement before the Conciliation Officer. In that
statement the Respondent explained his grievance regarding
termination of service. It is true that in the said statement the
Respondent admitted that since the year 2011 his wages were
being paid by Premsons Bazaar. The Conciliation Officer thereafter
attempted conciliation between the parties. Since the dispute could
not be resolved, a Failure Report dated 30 August 2016 was
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submitted. On the basis of this report the appropriate Government
referred the dispute to the Labour Court on 22 February 2017. This
sequence of events indicates that the Government acted upon the
materials which were available before the Conciliation Officer.
Once conciliation proceedings fail and the material shows a
dispute regarding termination of service, the Government is
generally justified in making a reference so that the matter can be
examined by the Labour Court in detail. The mere fact that the
employer has denied termination in its reply cannot by itself
conclude the matter. Such denial only raises a factual dispute
which requires adjudication. Therefore, the argument that the
reference itself was illegal cannot be readily accepted.
14. The next question concerns the identity of the employer. The
Petitioner strongly contends that there was no employer and
employee relationship between the Petitioner and the Respondent.
According to the Petitioner, Premson Trading Pvt. Ltd. and
Premsons Bazaar are two distinct legal entities. The Petitioner
relies heavily upon the Form-16 document which shows Premsons
Bazaar as the employer. It is also pointed out that the Respondent
himself admitted that his wages were being paid by Premsons
Bazaar. On the basis of these facts the Petitioner argues that the
dispute ought not to have been directed against the Petitioner at
all.
15. This argument cannot be brushed aside lightly. In law each
company has a separate legal identity. Even if two concerns are
related or belong to the same group, they are normally treated as
independent establishments. Therefore, the mere fact that one
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concern is a sister concern of another does not automatically make
them a single employer. At the same time, the Court cannot ignore
the surrounding circumstances and the practical manner in which
the business was functioning. The evidence on record shows that
there was some level of interconnection between the two
establishments. The witness of the Petitioner himself admitted that
Premsons Bazaar is a sister concern of the Petitioner company. He
also admitted that in certain circumstances the cashier of Premsons
Bazaar used to pay salaries of employees working in the
Petitioner's establishment. This admission assumes importance
because it shows that the financial and employment arrangements
between the two concerns were not completely separate in
practice. The Respondent has also relied upon the Provident Fund
receipt produced at Exhibit U-12. Provident Fund records are
generally maintained with reference to the establishment where
the employee actually works. Such records therefore carry
evidentiary value regarding the existence of employment. When
this document is read together with the oral admissions made
during cross examination and the Form-16 produced on record, a
picture emerges that the Respondent was performing work
connected with the common enterprise of the sister concerns.
16. In such situations the Court cannot look only at the formal
label of the employer mentioned in one document. It must see the
real substance of the relationship. If the work performed by the
employee, the payment of salary and the control exercised over the
employee indicate a common management structure, the Court
may examine the matter beyond the strict corporate form. The
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question always remains who was exercising real control over the
employment of the workman. The Labour Court has examined
these aspects in detail. It considered the documentary evidence
and also the testimony of witnesses. On appreciation of this
material the Labour Court reached the conclusion that the
Respondent was working in connection with the establishment and
that he had not been permitted to resume duty after his absence.
17. The Petitioner emphasises that the Respondent remained
absent from 14 April 2015 to 29 May 2015. According to the
Petitioner, this prolonged absence justified the management in
treating him as having abandoned service. Absence from work is
undoubtedly a relevant circumstance. However, absence by itself
does not automatically result in termination of employment.
Normally, when an employee remains absent without
authorization, the employer initiates disciplinary proceedings. A
show cause notice is issued and the employee is asked to explain
the absence. If the explanation is unsatisfactory, appropriate
disciplinary action follows. In the present case the record does not
show that any such disciplinary proceedings were initiated at the
relevant time. No show cause notice or charge sheet was issued in
the year 2015 alleging misconduct on account of unauthorized
absence. This aspect assumes importance. If the management truly
believed that the Respondent had abandoned service, it would
have been expected to record such abandonment through a proper
disciplinary process. The absence of such action creates doubt
regarding the stand now taken by the Petitioner. It is also
significant that after the period of absence the Respondent issued a
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demand notice dated 22 August 2015 alleging illegal termination
and seeking reinstatement. Thereafter he pursued the matter
before the Conciliation Officer by filing a Justification Statement.
These steps indicate that the Respondent was asserting his right to
continue in employment. They do not suggest a situation where
the employee had willingly abandoned service.
18. The Petitioner further relies upon certain letters issued in
January 2024 inviting the Respondent to resume duties. The
Petitioner refers to communications dated 10 January 2024 and 12
January 2024 and also to a warning memorandum dated 27
February 2024. According to the Petitioner, these documents show
that the management was always ready to take the Respondent
back in service. The Respondent, however, has produced his own
letters dated 10 January 2024, 18 January 2024, 22 January 2024
and 17 February 2024 in which he complained that the
management was not permitting him to report for duty. These
conflicting versions were placed before the Labour Court. Such
matters essentially involve appreciation of evidence and
assessment of credibility of the parties. The Labour Court, which
had the opportunity to examine the witnesses and documents in
detail, was better placed to evaluate these facts.
19. The jurisdiction of this Court under Article 227 of the
Constitution is supervisory in nature. This Court does not sit as an
appellate authority over the findings of the Labour Court.
Interference is justified only when the findings are perverse, or
when relevant evidence has been ignored, or when the decision
suffers from serious legal error. If the Labour Court has considered
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the evidence and reached a possible conclusion, the High Court
normally does not substitute its own view.
20. In the present case, the Labour Court examined the Form-16,
the Provident Fund document, the correspondence exchanged
between the parties and the admissions made during cross
examination. It also noticed that no disciplinary proceedings were
initiated against the Respondent for alleged unauthorized absence.
After considering these circumstances the Labour Court concluded
that the Respondent had been unjustly kept out of employment
and therefore deserved reinstatement with continuity of service.
21. The Petitioner has also argued that the Failure Report
submitted by the Conciliation Officer was issued without adequate
inquiry. Even if this argument is considered, it does not materially
affect the final outcome. The Conciliation Officer had before him
the Justification Statement of the Respondent and the replies of
the Petitioner. After conciliation failed he submitted the Failure
Report. Once the dispute was referred, the Labour Court
independently examined the entire matter and recorded its
findings based on evidence. Therefore, the dispute cannot now be
rejected merely on the ground that the preliminary inquiry was not
elaborate.
22. Finally, the question of back wages requires consideration.
The Labour Court has granted only 60 percent back wages from 17
August 2015. This shows that the Labour Court attempted to strike
a balance between the rights of the workman and the
circumstances of the case. The Court appears to have taken into
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account that the Respondent had remained absent for a certain
period and that the entire situation was not free from controversy.
At the same time it recognised that the Respondent had been
deprived of employment for a long period. The adjudicating
authority has discretion to mould the relief depending upon the
facts of each case. By awarding only 60 percent back wages the
Labour Court appears to have exercised such discretion in a
reasonable manner. This Court does not find the amount to be
excessive or arbitrary. Moreover, Respondent has not filed separate
petition challenging refusal to grant balance 40% back wages.
23. For all these reasons, the findings recorded by the Labour
Court cannot be said to be unreasonable or unsupported by
evidence. The conclusions reached by the Labour Court are based
on appreciation of the material available on record. Therefore, no
ground is made out for interference with the Award in exercise of
supervisory jurisdiction.
24. In view of the foregoing discussion and the reasons recorded
hereinabove, the following order is passed.
(i) The Writ Petition fails and is accordingly dismissed;
(ii) The Award dated 29 April 2024 passed by the 8th
Labour Court at Mumbai in Reference (IDA) No. 74 of 2017
is upheld;
(iii) The Petitioner shall comply with the said Award and
implement the directions contained therein. The Respondent
shall be reinstated in service with continuity and shall be
paid 60 percent of the back wages with effect from 17
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August 2015, as directed by the Labour Court;
(iv) The Petitioner shall calculate the amount of back wages
payable to the Respondent and pay the same within a period
of twelve weeks from the date of this order. In the event the
amount is not paid within the stipulated period, it shall carry
interest at the rate of 9 percent per annum from the date it
became payable until realization;
25. Rule stands discharged. In the circumstances of the case,
there shall be no order as to costs.
(AMIT BORKAR, J.)
