Management Of M/S Electric ... vs Presiding Officer & Anr.
2009 Latest Caselaw 529 Del

*             IN THE HIGH COURT OF DELHI AT NEW DELHI

                  WRIT PETITION(C) No. 2580 OF 1986

                                Date of Decision : February 13, 2009

Management of M/s. Electric                     ...Appellants
Control Switchboards                Through :   Mr. Manjit Singh,
                                                Advocate

                           Versus

Presiding Officer & Anr.                        ...Respondents.

Through : NEMO

CORAM :

HON'BLE MR. JUSTICE SUDERSHAN KUMAR MISRA

1. Whether Reporters of local papers may be allowed to see the judgment? Yes

2. To be referred to the Reporter or not? Yes

3. Whether the judgment should be reported in the Digest? Yes

SUDERSHAN KUMAR MISRA, J. :

1. The petitioner is aggrieved by an award dated 31.3.1986,

passed in ID No.78/80 by the Labour Court No.I, Tis Hazari

Courts, Delhi. It is the petitioner's case that the decision of the

Labour Court to the effect that the management has illegally and

unjustifiably terminated the services of the workmen and

ordering their reinstatement in service with continuity of service

and full back wages, is perverse and has occasioned a failure of

justice of a nature warranting interference in the exercise of writ

jurisdiction under Article 226 of the Constitution of India by this

Court.

2. A reference was made by the Secretary (Labour), Delhi

Administration, to the Labour Court, for adjudication of a labour

dispute in the following terms;

"Whether the removal from service of the workmen S/Shri Sushil Kumar and Mallu is legal/ justified and, if not, what directions are necessary in this behalf."

3. In their statement of claim, the workmen, Sh. Sushil Kumar

and Sh. Mallu, submitted that they were working with the

management as welder and tin smith at Rs.330/- and 350/- per

month respectively. The service of Sh. Sushil Kumar was

terminated with effect from 7.8.78 and that of Sh. Mallu from

9.9.78. The petitioner management contested the claim.

According to it, the reference made by the Delhi Administration

was without jurisdiction as the workmen had already settled

their claim in full before the conciliator. Further, the service of

Sh. Sushil Kumar was terminated on account of recession in

business and compensation in accordance with Section 25-F of

the Industrial Disputes Act, 1947 was duly tendered to him. Sh.

Mallu's employment was terminated because he never appeared

in the departmental enquiry pending against him, and thus

voluntarily abandoned his employment. The petitioner also

claimed that its factory has been closed with effect from

15.5.1982, thus the workmen cannot claim relief for the period

beyond that date. A rejoinder was filed by the workmen denying

all the allegations made in the written statement. The following

issues were framed;

1. Whether the appropriate Government made this reference, without considering all the facts and materials before it? If so, its effect?

2. Whether the appropriate Government made this reference mechanically as alleged by the management? If so, its effect?

3. As in terms of reference.

An additional issue framed on 28.11.83, which was;

4. Whether the management has closed its factory w.e.f. 15.5.1982 as is alleged in the written statement? If so, its effect?

4. On 18.5.1984, the Labour Court closed the evidence of the

petitioner management because it failed to produce any

evidence despite many opportunities. On 30.10.1984, the matter

was posted for evidence of the workmen. Since no one appeared

on behalf of the petitioner on that day, it was directed that the

matter shall proceed ex-parte. However, on 19th February, 1985,

on an application moved by the petitioner, the Labour Court set

aside the ex parte order. The relevant portion of the order

reads;

"He further submitted that the management has not adduced any evidence in this case and he would not cross examine the workman who had already been examined and would only advance arguments. In view of the submissions the representative of the workman has submitted that the application may be allowed and the Ld.

Representative of the management be permitted to advance arguments. Even otherwise under the law the Ld.

Representative of the management can participate during the arguments. Thus the application of the management is allowed without any order as to costs."

5. Ultimately, vide order dated 31.3.1986, termination of the

workmen, Sh. Sushil Kumar and Sh. Mallu, was declared illegal

and the Labour Court directed their reinstatement along with

continuity in service and full back wages.

6. The petitioner contends that the impugned award is

perverse because firstly the workmen failed to discharge the

onus placed on them under Section 25-B of the Industrial

Disputes Act, 1947 of showing that they were in continuous

service for 240 days. Consequently, the directions of the learned

Labour Court to the petitioner to lead its evidence without first

determining whether the workmen have placed sufficient

evidence on the record to prove 240 days of continuous service

by them, was contrary to law. In this behalf, counsel for the

petitioner has also relied on the decision of the Supreme Court

in Surendernagar District Panchayat Vs. Dahyabhai

Amarsinh (2005) 8 SCC 750, holding that where the claim of

the workman that he had worked for 240 days in the year

preceding his termination is denied by the management, the

Labour Court is obliged to first determine this question on the

basis of cogent evidence. In that context, the Supreme Court

further held that filing of his own affidavit by the workman

cannot be regarded sufficient evidence of that fact, and that

before the onus is placed on the management, further cogent

proof in the form of receipt of salary or wages for that period or

other record of appointment or engagement during this period

must be produced by the workman. Although the decision of the

Supreme Court in Surendernagar District Panchayat's case

(supra) is unexceptionable, to my mind, that authority cannot be

of any help to the petitioner because in this case it is the

petitioner's specific case that the respondent, Sh. Sushil Kumar,

was retrenched from service with effect from 7.7.1978 on

account of the recession in business, and that, "compensation in

accordance with Section 25-F of the Industrial Disputes Act was

duly tendered to him." This averment of the petitioner places

this case on an entirely different footing. In the case of

Surendernagar District Panchayat relied upon by the

petitioner, apart from a bald statement made by the workmen,

no cogent proof was tendered by them to prove that they had, in

fact, worked for more than 240 days. Here, in this case, it is the

petitioner's own stand that compensation in terms of Section 25-

F of the Industrial Disputes Act was tendered to the workman,

Sushil Kumar. To my mind, such an averment is an admission of

the fact that the workman was indeed entitled to compensation

under Section 25-F. Since the liability to pay compensation

under Section 25-F can only arise as on the date of retrenchment

where the workman has been in continuous service for not less

than one year, or where he was not in continuous service for

that period but has rendered 240 days' service, by tendering the

compensation to the workman under that Section, the only

presumption can be that the petitioner management itself was of

the view that the workman has worked for more than 240 days

in the year preceding his termination. Otherwise there was no

question of the aforesaid compensation under Section 25-F being

tendered by the petitioner to the workman. If this compensation

was tendered by the petitioner to the workman on any other

consideration, such as compassion, or ex gratia, then nothing

prevented it from saying so specifically. Consequently, once the

petitioner itself concedes that the workman was entitled to the

protection of Section 25-F, there was no need for the Labour

Court to go into the question whether the workman had

rendered continuous service for 240 days. Under the

circumstances, decision of the Labour court directing the

management to lead its evidence cannot be faulted.

7. As regards Sh. Mallu, the petitioner's case is that he

voluntarily abandoned his employment. The Supreme Court in

the case of Buckingham and Carnatic Co. Vs. Venkatiah AIR

1964 SC 1272 was of the view that abandonment or

relinquishment of service is always a question of intention, and

normally, such an intention cannot be attributed to an employee

without adequate evidence in that behalf. The law regarding the

onus of proving abandonment is no longer res integra. In Nicks

(India) Tools Vs. Ram Surat and Anr. (2004) 8 SCC 222 the

Supreme Court held that since the workman was in the service

of the management, the burden of proving that the workman

voluntarily left the service falls on the management.

8. Similarly a Division Bench of this Court in Shiv Dayal Soin

and Ors. Vs. The Presiding Officer, Labour Court in LPA No.

801/2002 decided on 20.12.2007 held that;

"11. However, it is pertinent to note that a mere accusation that the Workers had abandoned their jobs is not enough to accept the said imputation, degree of proof required to establish abandonment of service, is rather strict and the management in this case has failed miserably to discharge the said burden of proof..."

In Chandra Prabhu International Ltd Vs. Shri Ram Avtar,

WP(C) No.949/2008 decided on 21.2.2008, this Court again

held that the onus of proving abandonment lies upon the

management.

9. In the light of the above authorities the position is clear. It

was for the petitioner to prove that Sh. Mallu has voluntarily

abandoned his employment. It follows therefore that it was not

incumbent upon the workman Sh. Mallu to adduce evidence as

to his continuous service with the petitioner. For that reason

also, the Labour Court was justified in calling upon the

petitioner to lead its evidence first.

10. The next ground of challenge urged by counsel for the

petitioner is that the statements of petitioner's representative

that has been noted by the learned Labour Court in the

impugned order on 19th February, 1985 to the effect that, "he

would not cross examine the workman who had already been

examined and would only advance arguments" were, in fact,

never made by Mr. Anup Trehan, Advocate who had appeared

for the petitioner before the Labour Court. In support, Mr.

Trehan has also filed an affidavit in this Court in support of

above averment. In that affidavit, he states as follows;

"I did not make any statement before the court nor any submission to give up the right of the management to cross examine the workmen."

It is contended that since the right to cross examine the

workmen was, in fact, not given up by the petitioner

management before the Labour Court, the Labour Court ought

to have given it an opportunity to cross examine the workmen.

11. In addition, learned counsel for the petitioner has also

stated that in fact the petitioner's establishment was closed on

15th May, 1982. Consequent upon this closure, a settlement was

also arrived at between the management and its employees.

This is stated to have been entered into in the presence of one

Mr. K. R. Sahni, the Conciliation Officer.

12. In terms of this settlement entered into on 3.6.1982,

closure compensation in the amounts mentioned against the

name of each employee was paid on that date itself. In addition,

bonus was also undertaken to be paid by 30.11.1982. A copy of

the said settlement has been placed on the record of this Court

by the petitioner as annexed to the writ petition. Although this

document has not been produced before the Labour Court the

same has not been denied by the respondents-workmen in these

proceedings.

13. Learned counsel for the petitioner has further contended

that in terms of interim order of this Court dated 3 rd December,

1986, the petitioner has deposited back wages due to the

workmen calculated with effect from 1st August, 1978 upto the

date of closure of the establishment on 15 th May, 1982. It is the

petitioner's case that there could be no claim against the

management for any payment after the date of closure of the

establishment itself. He submits that even in the event that the

workmen are found to have been illegally retrenched at the

highest, the Labour Court could have directed payment of back

wages upto the date on which the factory was closed along with

any retrenchment compensation that would have become

payable as on the date of the closure of the factory. Counsel for

the respondent has not been able to produce any authority for

the proposition that in case the establishment is closed and the

workman is retrenched illegally, the management would be

liable to continue to pay the last drawn wages to the workman

forever.

14. The Labour Court can proceed ex parte against any party

and also has power to recall any such order. This power has

been conferred on the Labour Court by virtue of Rule 10-B.(9) of

The Industrial Disputes (Central) Rules, 1957. The said rule

reads as follows;

"10B.(9). In case any party defaults or fails to appear at any stage the Labour Court, Tribunal or National Tribunal, as the case may be, may proceed with the reference ex parte and decide the reference application in the absence of the defaulting party.

Provided that the Labour Court, Tribunal or National Tribunal, as the case may be, may on the application of the either party filed before the submission of the award revoke the order that the case shall proceed ex parte, it is satisfied that absence of the party was on justifiable grounds."

15. In the case at hand, in its order setting aside the ex parte

order, whilst noting that the order is made in view of the

submission of the representative of the management that he

would not cross examine the workmen, the Labour Court also

noted;

"Even otherwise under the law the Ld. Representative of the management can participate during the arguments."

It is difficult to presume that the petitioner's representative

would have taken a position before the Labour Court which

would result in nullifying the relief sought. It is apparent that

the application for setting aside the ex parte order was moved by

the petitioner with a view to be relegated to the position as they

were on the date from which they were proceeded ex parte. If

the petitioner was satisfied with exercising the limited rights of

appearing and advancing arguments before the Tribunal, then

there was no need for it to move this application at all. The

effect of the order is that although the application is stated to

have been allowed in terms of the so-called statement of the

petitioner's representative, the same has in effect been

dismissed since no relief has in fact been granted. Looked at in

another way, once the application is allowed, the ex parte order

dated 30.10.1984 is set aside, but strangely, despite this, the

management was precluded from proceeding further from that

stage. The so-called concession by the respondent recorded in

that order is in fact no concession at all. This is because by it the

petitioner has secured no benefit and the respondent's position

has not changed at all. In addition, the crucial facts, inter alia,

demonstrating the fact that the petitioner establishment itself

was closed on 15.5.1982, and that consequent upon its closure, a

settlement was also arrived at between the management and its

employees in the presence of a conciliation officer whereby

compensation was paid to all the employees, could only have

been proved by the evidence of the petitioner and by cross-

examining the respondents-workmen. It is inconceivable for the

petitioner management to have decided to give up the only plea

that could have enabled it to successfully prove its case. Also,

once the learned Labour Court allowed the application of the

management on 19.2.1985, the automatic effect would be that

the order dated 30.10.1984 directing that the matter shall

proceed ex parte was recalled, and it relegated the petitioner to

the position it was on 30.10.1984. Furthermore, an affidavit by

Mr. Trehan, Advocate, who represented the petitioner on that

date, stating that no such submissions or concessions were made

by him on 19.5.1985, has been placed on record. To my mind,

there is no reason to disbelieve the same.

16. During the course of arguments, learned counsel for the

petitioner submitted that at best the Tribunal could have

directed payment of back wages upto the date of closure of the

factory along with retrenchment compensation that would have

become payable due to such closure. He had also submitted that

if the court thinks fit, it might direct some compensation to be

paid in a lump-sum to meet the ends of justice keeping in mind

the circumstances of the case. Looking at the totality of

circumstances and specially in view of the fact that services of

the workmen in question were terminated in the year 1978 i.e.,

more than 30 years ago, and the fact that the establishment was

also closed in the year 1982 i.e., nearly 27 years ago; and also in

view of the fact that consequent upon its closure, a settlement

was also arrived at between the Management and its employees

in the presence of a Conciliation Officer, which included an

undertaking to pay bonus, all of which has not been controverted

by the workmen before this Court; to my mind, at this belated

stage, no useful purpose would be served in remanding the

matter once again to the labour court after setting aside the

impugned order with a view to enable the Tribunal to record

further evidence of the parties in support of their claims. The

interest of justice would be served if the workman is permitted

to withdraw the amount towards back wages calculated from Ist

August, 1978 to the date of closure of the establishment on 15 th

May, 1982 that has been deposited by the petitioner in terms of

this interim order of this Court dated 3 rd December, 1986 along

with any interest that may have accrued thereon. It is ordered

accordingly.

17. The impugned award dated 31st March, 1986 in I.D. No. 78

of 1980 is, therefore, set aside and the writ petition is disposed

off on the above terms.

Sudershan Kumar Misra, J.

February 13, 2009