A.F. Ferguson And Co. vs Presiding Officer And Kanwaljeet ...
2006 Latest Caselaw 2271 Del

JUDGMENT

Shiv Narayan Dhingra, J.

1. By this writ petition, the petitioner has challenged the validity of award dated 22.10.2001 passed by Labour Court III, Karkardooma, Delhi whereby the Labour Court held that the termination of the respondent No. 2 by the petitioner was illegal and directed the petitioner to pay a compensation of Rs. 5 lacs in lieu of the reinstatement and full back wages.

2. Briefly, the facts are that the respondent was working with the petitioner firm as Executive Secretary since 12.11.1986. Her services were terminated w.e.f. 10.3.1992 vide letter dated 17.2.1992. She made a representation to the management vide letter dated 28.2.1992 and 20.3.1992. The management revoked the earlier letter of termination and extended her services up to 31.3.1992. Finally, her services were terminated w.e.f. 1.4.1992 vide letter dated 31.3.1992. The respondent raised an industrial dispute alleging that her termination was illegal and the same was referred to the Labour Court in following terms:

Whether the termination of services of Smt. Kanwaljeet Ghura is illegal and/or unjustified and if so, to what relief is she entitled and what directions are necessary in this respect?

3. It is undisputed that the designation of the respondent was Executive Secretary and she was attached to Mr. Ashok Behl, Director Management (hereinafter called the Director). The respondent claimed that nature of her duties was to take shorthand dictation notes, typing those notes on electronic typewriter or computer, handling of correspondence, fixing of appointments of the Director, doing filing work, handling petty cash and operating PABX board. She was a 'workman' within the definition of Section 2(s) and her designation was a misnomer. The petitioner claimed that the respondent's responsibility included distribution of client enquiries and letters amongst the various professional staff. She used to fix schedule and allocate Director's time to candidates, who were to be interviewed by the Director. She had a discretion to change the time and venue of interviews. She was responsible for checking professional qualifications as well as testimonials of the candidates. She used to ensure medical examination and completion of other formalities of the candidates. She used to interact with Head Office of the management located in Bombay and in addition use used to appoint part-time employee such as typists after conducting typing test. She was also responsible for ensuring preparation and submission of reports within time.

4. The Tribunal after considering the entire evidence which had come on record came to the conclusion that the respondent's main work was clerical in nature and even if she was doing some supervisory work that was only incidental, she was a 'workman'. This finding of the Tribunal has been assailed by the management. The other issue raised by the management is that the petitioner was not an industry being a firm of Chartered Accountants and giving consultancy. The petitioner had also taken the stand that the respondent had voluntarily resigned from the job and her services were not terminated. One of the stands of the petitioner is that the services of the respondent were terminated on account of her irresponsible behavior and she was not even liable to be given three months notice or pay in lieu thereof. However, upon insistence by the respondent and in order to avoid any unnecessary litigation the petitioner had acceded to the request of the respondent and paid a sum of Rs. 13,205.55/- to her in addition to three months salary paid in lieu of the notice period. Thus, the act of the petitioner in terminating the services was with the consent of the respondent. The respondent got the cheque of Rs. 26,336.55/- encashed without any protest. The respondent raised the Industrial Dispute despite after settling her claims with the petitioner. The petitioner also assailed the awarding of compensation to the tune of Rs. 5 lacs to the respondent taking into account the full back wages of the respondent. It is stated that the respondent in her cross examination admitted that she never tried for a job anywhere else after termination of services and under this circumstance, compensation should not have been determined on the basis of full back wages. Her last drawn salary was Rs. 4377/- and she had worked with the management only for a period of less than six years she had been awarded full salary of more than 10 years as compensation. This would have serious repercussions for the petitioner and jeopardize the cordial relationships of the petitioner with its other employees.

5. The respondent in its counter affidavit has replied to the grounds taken by the petitioner and supported the Tribunal's orders. She stated that she was a workman, she used to do the clerical work and follow the directions of the Director. She was not a supervisor. Her services were terminated wrongly she was entitled for full back wages and service benefits amounting to Rs. 18,69,671/-. However, the Labour Court had granted her only a sum of Rs. 5 lacs as compensation. Her services were wrongfully terminated and a new lady secretary was appointed in her place. No enquiry was held before her termination.

6. It is argued by the counsel of the petitioner that the learned Labour Court's award was perverse because Industrial Tribunal relied upon judgment of S.K. Verma v. Mahesh Chandra 1983 (4) SSC 214. This judgment was overruled by the Supreme Court in H.R. Adyanthaya and Ors. v. Sandoz (India) Ltd. and Ors. 1994 (5) SCC 737. The Labour Court has wrongly held that the respondent was a 'workman'. It is also argued that the issue of the workman being basic issue and going to the root of the matter can be agitated by way of writ petition under Article 226 and this Court can look into the fact whether the respondent was a 'workman' or not.

7. A perusal of the evidence led by the parties would show that the respondent was not having any independent charge. She was attached to the Director and used to carry out the orders of the Director. Fixing up of time or venue of interviews as per Director's order does not amount to supervisory work neither maintenance of Diary of engagements of Director would amount to supervisory work. Taking dictation, typing letters and handling correspondence with the Head Office and doing other things at the behest of her boss only amounted to clerical work and not supervisory work. It has come in evidence that she used to type reports and submit typed reports. These reports were not her creation and used to be sent by others would also show that she had no independent power of taking decision and had no supervisory work. A supervisor is a person who supervises the work of others . No regular employees were working under her. The fact that whenever there was some extra work, she was asked to engage part-time typists get the extra work done does not mean, that she had power to appoint regular employees and supervise their work. She was in fact exercising powers delegated by her by the Director, she had no independent power to do any work without the instructions of the Director. It is normal for all personal or executive secretaries attached with senior management personnels or Directors to carry out the orders of their bosses. By no stretch of imagination a secretary can be termed as a 'supervisor'. It is settled law that it is not the nomenclature of the post or the designation which is decisive to hold whether a person was a 'workman' or not, but the nature of duties being performed by the person are decisive. In order to be a 'workman' a person has to satisfy that he is performing duties as described under Section 2(s) i.e. manual, semi-skilled, skilled, operational, technical, clerical or supervisory. If a person is performing any of these duties he is a 'workman'. The test as laid down in H.R. Adyanthaya Case (supra) is also the same that the person who claims to be a 'workman' has to satisfy that he is performing the jobs enumerated under Section 2(s). In this case the respondent successfully showed that she was performing the jobs of clerical nature, she had no independent supervisory powers. She was attached with the Director (Management) and was just carrying out the orders of Director Management that also of clerical nature and not of any supervisory nature. I, therefore, consider that the Industrial Tribunal rightly came to the conclusion that the respondent was a 'workman'.

8. The plea of the petitioner that it was not an industry must fail. So long as Bangalore Water Supply and Sewerage Board v. K. Rajappa and Ors. 1978 (2) SSC 213 holds the ground, the petitioner is an 'industry'. The petitioner is providing services to the members of society with the help of his employees. The activities of petitioners are commercial activities. Since the petitioner satisfies the test as laid down by Bangalore Case (supra) the petitioner is an 'industry' and the Industrial Tribunal rightly came to this conclusion.

9. The contention of the petitioner that the respondent herself resigned from the service is not supported by any evidence. No resignation letter was given by the respondent. In fact letter dated 17.2.1992 would show that the management referred to certain discussions between the petitioner and respondent and told the respondent that her services were not required after 10.3.1992 for the reasons communicated to her orally. While receiving this letter of 17.2.1992 the respondent appended her remarks that her termination was not as per her appointment letter dated 12.11.86 and the reasons given by the management as communicated were not valid and justified reasons. This would show that she had neither accepted her termination nor resigned from the service. The management wrote another letter dated 31.3.1992 informing the respondent that her services were terminated w.e.f. 1.4.1992. In the letter, it is stated that she was being paid three months notice pay in lieu of notice period, she received a cheque of Rs. 26,336.55/- on 2.6.1992 towards full and final settlement of her dues. No details of this amount were given to her. I consider that there was no option with the respondent but to receive her dues. Once the company had terminated her services, the receiving of full and final dues does not amount to voluntarily resignation or any settlement arrived at between the petitioner and the respondent. Thus the receiving of dues by the respondent is of no help to the petitioner.

10. An argument has been raised by the petitioner that the amount of Rs. 26,336.55/- included the amount of retrenchment compensation. The petitioner relied upon a letter dated 9.8.2001 written by petitioner to its advocate Rajender Dhawan. This letter does not form part of evidence nor was sent to the respondent at any point of time. It seems this letter was placed before the Labour Court at the time of final decision. In this letter the amount of Rs. 26,366.55/- has been split into three months' notice period salary as Rs. 13131/- and three months' salary as retrenchment compensation. I consider that these details cannot be relied upon to show that retrenchment compensation was paid. Since according to petitioner the respondent had worked for about six years in the petitioner corporation she would have been entitled to gratuity equivalent to approximately three months salary @ 15 days salary per year. This splitting up of the amount paid to her as a notice period pay and retrenchment compensation seems to be an after thought. No notice of retrenchment was served by the petitioner upon the respondent nor it was told to the respondent that she was being retrenched and retrenchment compensation was being paid to her. She would have been entitled to gratuity, leave encashment etc. as well.

11. It is argued by the petitioner counsel that the compensation of Rs. 5 lacs was excessive and disproportionate to the salary being drawn by her. On the other hand it is argued by the counsel for respondent that compensation of Rs. 5 lacs was rather on the lower side looking into the fact that the respondent would have got promotions in the company and her salary would have increased with the passage of time.

12. It is now settled law that the Courts have to have a pragmatic approach in respect of labour disputes. Where no contribution has been made by an employee all along after termination during the pendency of dispute allowing of full back wages is not considered as good law. The holding of an order of termination illegal by Labour Court does not necessarily mean grant of full back wages and reinstatement. The Court has to frame the relief keeping in view all facts and circumstances. The respondent in this case was working in a reputed Chartered Accountant firm as a secretary. Her termination though illegal was done simpliciter without putting any stigma on her. If she was interested in doing job, she could have got alternate job elsewhere, she had about six year experience and knew all secretarial jobs. It is admitted that she made no attempt to seek any alternate job. If she had not been terminated, she would have earned wages only by working during her duty hours and not by sitting idle. But after termination she enjoyed idleness and made no attempt to find a job for her. Though her termination was illegal as per labour laws, but it gave an opportunity to her to prove her mettle. It is not a case where she remained unemployed because she could not get a job, but it is a case where she chose not to do any job further.

13. Even if the termination was illegal the Court was not bound to award full back wages and to reinstate her, more so, when the nature of the job of the respondent was that of a personal secretary. A personal secretary has to work in total rhythm with the person to whom he or she is attached. If the wavelength of the personal secretary of the Director (Management) is not the same or the attitude of the personal secretary is not the one that is liked by the person she is attached to, the work does not go smoothly and in such cases either the personal secretary has to be removed after giving payment of retrenchment compensation or she has to be given some alternate job within the company. Since, in this case no retrenchment compensation was given and the removal was done in contravention of Section 25F of the Industrial Disputes Act, the Labour Court had rightly held that the termination was invalid. However, the grant of compensation has to reasonable considering all facts and circumstances. The last drawn salary of the petitioner was Rs. 4377/- p.m. including HRA. Accordingly, her annual Salary would amount to Rs. 52,524/-. I consider that a compensation of Rs. Two lacs Fifty Thousand would be a reasonable compensation in such case. I, therefore, hold that the compensation of Rs. 5 lacs granted by the Labour Court was excessive in nature and compensation of Rs. 2.5 lacs would be a reasonable compensation.

14. An amount of Rs. 2.5 lacs as F.D. was deposited by the petitioner under the directions of this Court with the Registrar General and is earning interest. The amount along with interest be released in favor of the respondent. The writ petition is allowed to the above extent.