Management Of Electronics ... vs The Secretary (Labour) And Anr.
2006 Latest Caselaw 2314 Del

JUDGMENT

Shiv Narayan Dhingra, J.

1. By this writ petition, the petitioner has challenged the validity of the award dated 19th August, 1999, passed by the Labour Court VI, in I.D. No. 76/96 whereby the Labour Court directed reinstatement of the respondent with full back wages.

2. Briefly the facts are that the respondent was working with the petitioner at a monthly salary of Rs. 1420/-. He alleged that his services were terminated by the management on 4th March, 1995 when, on his complaint, the Labour Inspector Mr. D.S. Gautam had visited the factory and the Labour Inspector asked the management to provide appointment letter to him and pay minimum wages. The management got annoyed due to this and in the revenge, his services were terminated. he sent demand notice dated 11.3.95 and 24.3.95 but the management gave no reply. Following dispute was referred for adjudication to the Labour Court by the appropriate Government:

Whether Sh. Rakesh Kumar has abandoned his services or his services have been terminated illegally and/or unjustifiably by the management and if so, to what relief is he entitled and what directions are necessary int his respect?

3. The stand of the management was that it had not terminated the services of the claimant but in fact the claimant stopped coming on duty from that day. The management gave him several opportunities. He was treated to have abandoned his service because of unauthorized absence without proper sanction of leave and intimation. The management had also paid an advance of Rs. 5000/- to workman on 22.2.95 and that amount was still due from him. His wages for February, 1995 fell due for payment on 7.3.1995, which could not be paid because he had been absenting from 4.3.95. The workman was working as a helper and minimum wages, as payable to a helper(unskilled workman) were being paid to him. However, the workman insisted that he should be paid wages of a semi skilled workman which the management had refused to pay because he was not a semi skilled workman. The management had engaged him as a helper and continued to pay him till he worked with the management. The claim of the workman was not tenable.

4. The Labour Court, after recording evidence of both sides, came to conclusion that it was not a case of abandonment of services. The management had admitted that the respondent workman was absenting from duty but his name was not struck off from attendance register. Mere absence from duty was not abandonment of a job. The Labour Court observed that the Labour Inspector had visited the management for reinstatement of workman and sent a letter dated 27.3.95 to union that the management had not agreed to take back the workman and had also not agreed to pay wages as applicable to the semi-skilled workman so the dispute was not settled and the union may proceed further. In view of the letter of the Labour Inspector and the testimony of witnesses, the Labour Court concluded that it was proved that the management had terminated the services of the workman without following the provisions of Section 25F of the Industrial Disputes Act.

5. It is argued by learned Counsel for the petitioner that the award of the Labour Court, awarding full back wages and reinstatement was bad in law. The awarding of full wages was not the automatic result of holding the termination as illegal. The Labour Court should have kept all facts and circumstances in view. He further argued that the petitioner management had closed down in October, 1999. The award was passed in August, 1999 and the closure could not have been pleaded by the management before the Labour Court because at that time management had not closed down. Even if the respondent had been reinstated, with the closure of the management, his services would have come to an end and he would have been entitled to the benefit of closure. The management was a small partnership firm and it needed no permission from the Government for closure. He submitted that despite closure, one of the partners of the firm had already paid more than Rs. 1.25 lac to the respondent by way of paying him minimum wages under Section 17-B of the I.D. Act from August, 1999 till date. It is submitted that the Court should consider all facts and circumstances and the amount already paid to the workman should be considered as sufficient compensation paid to him.

6. In the counter affidavit filed by the workman, he denied the factum of closure of establishment and took a stand that the management had shifted to NOIDA.

7. It is now settled law that full back wages is not the natural consequence of holding termination as illegal and the court can suitably modify the relief taking into account all facts and circumstances. In the instant case, there was earlier also a dispute between the petitioner and the respondent and that dispute was settled by the petitioner with the intervention of the Labour Inspector. The petitioner paid to the respondent full back wages and re-employed him. It is not disputed that the report of Labour Inspector shows that the respondent was only an unskilled workman and he was being paid wages of an unskilled workman. The respondent had made complaint to the Labour Inspector that he was not being paid wages of semi skilled workman and wanted the Inspector to ask the management to pay him wages of semi skilled workman. That seems to be the root case of management being aggrieved and gave rise to the dispute between the petitioner and the respondent.

8. It is a fact that the management had been paying back wages to the respondent under the directions of this Court from August, 1999 onwards till date. It is submitted by counsel for the petitioner that this payment was being made by the erstwhile partner from his personal account, since LPA of the petitioner against order under Section 17-B of the Act, was dismissed. A perusal of order of LPA would show that the Division Bench of this Court observed that since the plea of the closure was not taken by the petitioner before the Labour Court, this plea cannot be considered in LPA challenging the order under Section 17-B of the Act.

9. In Allahabad Jal Sansthan v. Daya Shankar Rai and Anr. 2005 SCC(L&S) 631, Supreme Court held:

In law in absolute terms cannot be laid down as to in which cases, and under what circumstances, full back wages can be granted or denied. The Labour Court and/or Industrial Tribunal before which industrial dispute has been raised, would be entitled to grant the relief having regard to the facts and circumstances of each case. For the said purpose, several factors are required to be taken into consideration. It is not in dispute that Respondent 1 herein was appointed on a ad hoc basis; his services were terminated on the ground of a policy decision, as far back as on 24.1.1987. Respondent 1 had filed a written statement wherein he had not raised any plea that he had been sitting idle or had not obtained any other employment in the interregnum. The learned Counsel for the appellant, in our opinion, is correct in submitting that a pleading to that effect in the written statement by the workman was necessary. Not only no such pleading was raised, even in this evidence, the workman did not say that he continued to remain unemployed. In the instant case, the respondent herein had been reinstated from 27.2.2001. (para 6)

In Tapan Kumar Bhattacharya this Court noticed that there was no pleading or evidence as to whether the respondent therein was employed elsewhere during the long interregnum and in the fact situation obtaining therein, the appellant was directed to pay 50% of the back wages till the date of reinstatement. (Para 7)

Yet again in Jarina Bee this Court observed that the award of full back wages was not the natural consequence of an order of reinstatement. (para 8)

In Rahmat Ullah , a Bench of this Court held that as the respondent therein was out of service since 1990 as an ordinary worker, he must have been working elsewhere to earn his livelihood; and there was no material to show that he was not gainfully employed, direction to pay 50% of the back wages was made. (para 9)

In Ram Ashrey Singh v. Ram Bux Singh (2003) 9 SCC 154, questioning the order of termination after six years was considered to be one of the factors for denying an order of reinstatement with back wages to the workman. In the fact situation obtaining therein, it was held that ends of justice would be subserved if the appellants therein were directed to pay a sum of Rs. 35,000/- by way of compensation in addition to what has already been paid (See also Sonepat Coop. Sugar Mills Ltd. v. Ajit Singh ). (para 10)

In Indian Rly. Construction Co. Ltd. (2003) 4 SCC 602 this Court merely stated:(SCC pp.593-94, para 30).

"30. Question then would be how the conflicting interests can be best balanced. By an interim order dated 5.5.2000 the appellant was directed to reinstate the respondent subject to an interim payment of Rs. 3 lakhs towards the back wages. Directions for reinstatement does not automatically entitle an employee to full back wages. In Hindustan Tin Works(P) Ltd. v. Employees a three-Judge Bench of this Court laid down:(SCC p.86, para 11)

'11. In the very nature of things there cannot be a straitjacket formula for awarding relief of back wages. All relevant considerations will enter the verdict. More or less, it would be a motion addressed to the discretion of the Tribunal. Full back wages would be the normal rule and the party objecting to it must establish the circumstances necessitating departure. At that stage the Tribunal will exercise its discretion keeping in view all the relevant circumstances. But the discretion must be exercised in a judicial and judicious manner. The reason for exercising discretion must be cogent and convincing and must appear on the face of the record. When it is said that something is to be done within the discretion of the authority, that something is to be done according to the rules of reason and justice, according to law and not humour. It is not to be arbitrary, vague and fanciful but legal and regular(see Susannah Sharp v. Wakefield 1891 AC 173, AC at p. 179) (para 14)

In Nicks (India) Tools this Court again in the fact situation obtaining therein refused to interfere with the discretionary jurisdiction exercised by the High Court particularly having regard to the fact that it was for the first time before the writ court, such plea was raised by way of additional evidence, which had been rejected. (para 15)

We have referred to certain decisions of this Court to highlight that earlier in the event of an order of dismissal being set aside, reinstatement with full back wages was the usual result. But now with the passage of time, it has come to be realized that industry is being compelled to pay the workman for a period during which he apparently contributed little or nothing at all, for a period that was spent unproductively, while the workman is being compelled to go back to a situation which prevailed many years ago when he was dismissed. It is necessary for us to develop a pragmatic approach to problems dogging industrial relations. However , no just solution can be offered but golden mean may be arrived at. (para 16)

In view of the fact that the respondent had been reinstated in service and keeping in view the fact that he had not raised any plea or adduced any evidence to the effect that he remained unemployed throughout from 24.1.1987 to 27.2.2001, we are of the opinion that the interest of justice would be subserved if the respondent is directed to be paid 50% of the back wages. (para 17)

10. I consider that Court has to take a pragmatic approach in each case. The termination was alleged in 1994. Twelve years have elapsed. It is not disputed that the management closed down at Ansari Road. The workman was working as an unskilled helper and there is no presumption that the workman remained unemployed throughout. The workman had already received an amount of Rs. 1,25,000/- under Section 17-B of the Act as wages for the period for which he had not worked. I consider that this was enough compensation to be given to the workman. Accordingly, the award is modified and the amount already received by the workman is considered as sufficient compensation in lieu of reinstatement and wages.

11. In view of the above, the writ petition is allowed to the above extent. The award of the Labour Court is set aside. No orders as to costs.