Surender Kumar vs Dcm Ltd. & Ors.
2011 Latest Caselaw 2642 Del

            *IN THE HIGH COURT OF DELHI AT NEW DELHI

                                              Date of decision: 18th May, 2011
+                                  W.P.(C) 7744/1999
%        SURENDER KUMAR                                      ..... Petitioner
                    Through:              Mr. Vinay Sabharwal & Ms. Neha
                                          Sabharwal, Advocates

                                     Versus
         DCM LTD. & ORS.                                   ..... Respondents
                      Through:            Mr. Harvinder Singh & Mr. Prateek
                                          Kohli, Advocates
CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1.       Whether reporters of Local papers may               No
         be allowed to see the judgment?

2.       To be referred to the reporter or not?              No

3.       Whether the judgment should be reported             No
         in the Digest?

RAJIV SAHAI ENDLAW, J.

1. The writ petition impugns the award dated 13th September, 1999 of

the Industrial Adjudicator on the following reference:

"Whether the services of Sh. Surender Kumar have been terminated illegally and / or unjustifiably, if so, to what directions are necessary in this regard?"

holding the termination of employment of the petitioner workman by the

respondent employer to be illegal and unjustified but granting the relief

only of five years pay at the rate of last drawn wages to the petitioner

workman.

2. The writ petition was filed impugning the award declining the relief

of reinstatement with full back wages, continuity of service and all other

consequential benefits to the petitioner workman and seeking the said

reliefs against the respondent employer.

3. Notice of the writ petition was issued and vide order dated 18 th July,

2002, the respondent employer directed to deposit the amount awarded by

the Industrial Adjudicator with the Registrar General of this Court, to be

kept in a fixed deposit for a period of six months. On 11 th December,

2002, it was informed that in pursuance to the said direction an amount of

`38,400/- had been deposited by the respondent employer and kept in a

fixed deposit. The fixed deposit was directed to be renewed from time to

time. Rule was issued in the petition. The counsels for the parties have

been heard. The counsels have confined the submissions to the quantum of

compensation.

4. The petitioner workman was working in the Weaving Department of

the respondent employer with effect from 10 th March, 1976; on 18 th

November, 1981 while on duty, he was indisposed and was granted

medical leave from 19th November, 1981 to 25th November, 1981; he

claimed to have again fallen ill and reported back for duty on 3rd

December, 1981 when he was not allowed. The respondent employer

claimed that the petitioner workman owing to absence without leave from

26th November, 1981 for more than 10 days, under the Standing Orders,

had lost lien on his employment. The said action of the respondent

employer has been held to be illegal and unjustified by the Industrial

Adjudicator. There is no challenge to the said finding and the said facts

have been mentioned only for their relevance in the determination of

quantum of compensation.

5. The Industrial Adjudicator in the award though having held the

termination by the respondent employer of the employment of the

petitioner workman to be illegal, did not grant the relief of reinstatement

for the reason of it having come on record that the mill in which the

petitioner workman was employed had been closed in 1989 pursuant to an

order of the Lieutenant Governor, Delhi. It was even otherwise held that it

was not proper to order reinstatement after lapse of 18 years.

6. The Industrial Adjudicator while calculating the quantum of

compensation to which the petitioner workman was entitled to in lieu of

reinstatement noted that the petitioner workman had not alleged in the

Statement of Claim that he was out of job; that he did not depose so in his

examination in chief; that in his cross examination, he admitted that he

made no efforts to seek gainful employment. The Industrial Adjudicator

held that the petitioner workman had a duty to mitigate the loss.

7. It was the claim of the petitioner workman before the Industrial

Adjudicator and is, before this Court also, that the petitioner workman was

entitled to compensation equivalent to salary / emoluments till the closure

of the mill i.e. from 1981 till 1989, plus closure compensation equivalent

to 5 years' salary which the respondent employer had paid to the other

workmen employed in the Mill.

8. The respondent employer opposes the claim for compensation on the

basis of aforesaid on the ground that closure compensation could not be

granted being beyond the scope of reference; that the petitioner workman

ought to have got the reference amended if he wanted to claim closure

compensation before the Industrial Adjudicator; that closure compensation

could be paid only to those employees who were on the rolls of the

respondent employer on the date of closure.

9. The Industrial Adjudicator justified the grant of compensation of

five years pay at the rate of last drawn wages as meeting the ends of justice

by also observing that at the most, the petitioner workman could claim

50% wages from the date of filing the claim in 1983 till closure in 1989 i.e.

three years salary and the remaining amount would be towards closure

compensation.

10. The counsel for the petitioner workman has contended that once the

termination was held to be illegal, the effect thereof would be to deem the

petitioner workman to be in employment till the date of closure and in

which event he would have been entitled to the closure compensation paid

to the other employees. He has thus contended that the closure

compensation of five years at the rate of the emoluments which the

petitioner workman would have earned in the year 1989 could not have

been denied in any case to the petitioner workman; in addition, the

petitioner workman is also entitled to emoluments from the date of illegal

termination till closure.

11. Per contra, the counsel for the respondent employer has relied on:

(i) Parry & Co. Ltd. Vs. P.C. Pal (1969) 2 SCR 976 to contend

that this Court in exercise of jurisdiction of judicial review

under Article 226 of the Constitution of India ought not to

interfere in the discretion exercised by the Industrial

Adjudicator as to the quantum of compensation. The Supreme

Court in the said judgment held that a mere wrong decision

cannot be corrected by a writ of certiorari as that would be

using it as the cloak of an appeal in disguise and that only a

manifest error apparent on the face of the proceedings based

on a clear ignorance or disregard of the provisions of law or

absence of or excess of jurisdiction, when shown, can be so

corrected.

(ii) Regional Manager, S.B.I. Vs. Rakesh Kumar Tewari (2006)

1 SCC 530 laying down that if a plea in respect of Section

25G of the I.D. Act is not put forward, it is not open to the

Tribunal to "go off on a tangent" and conclude that the

termination of service of the respondent was invalid. The said

judgment has been cited to contend that the aspect of closure

compensation could not have been gone into by the Industrial

Adjudicator.

(iii) Anoop Sharma Vs. Executive Engineer (2010) 5 SCC 497

also on the aspect of interference in labour matters and laying

down that when the award of the Industrial Adjudicator is not

vitiated by error of law apparent on the face of the record, the

High Court should not interfere.

12. The counsel for the respondent after the close of hearing has also

filed copies of the following judgments:-

a. J.K. Iron & Steel Company Ltd. vs. Iron & Steel Mazdoor

Union 1956(I) LLJ 227 SC - however the said judgment is not

found applicable;

b. Rolston John v. Central Government Industrial Tribunal-cum-

Labour Court AIR 1994 SC 131 where the Supreme Court had

awarded lump sum compensation of `50,000/- for failure to

follow procedure under Section 25F of the Act;

c. Smt. J. Twari v. Smt. Jawala Devi Vidya Mandir 1979 (1) SLR

614 SC - on the aspect of the employee being required to

mitigate the damages by trying to obtain an alternative

employment;

d. Kendriya Vidyalaya Sangathan v. S.C. Sharma (2005) 2 SCC

363 laying down that initial burden is on the employee to show

that he was not gainfully employed and it is only thereafter that

the employer can bring on record materials to rebut the claim of

the employee and without the employee pleading or proving any

such material, full back wages cannot be awarded;

e. U.P.State Brassware Corporation Ltd. v. Uday Narain Pandey

(2006) 1 SCC 479 laying down that full back wages cannot be

allowed automatically or mechanically only because an order of

termination is found to be unsustainable;

f. State of M.P. v. Arjunlal Rajak (2006) 2 SCC 711 laying down

that for non-compliance of Section 25F, ordinarily workman

could be directed to be reinstated with or without back wages, but

when a project or scheme or an office itself is abolished, relief of

reinstatement is not to be granted;

13. The counsel for the petitioner also, after the close of hearing, has

filed copies of the following judgments;

(i) Anoop Sharma (supra) laying down that non-compliance

Section 25F renders the termination to be nullity and the

employee is entitled to continue in employment as if his

services were never terminated. I may however note that the

said case was not concerned with the quantum of

compensation;

(ii) Mohan Lal v. Management of Bharat Electronics Ltd. AIR

1981 SC 1253 laying down that where pre-condition for a

valid retrenchment is not satisfied, termination of services is

ab initio void, inoperative and invalid and the workman

continues in service with consequential benefits. This

judgment again was not concerned with the aspect of

compensation;

(iii) DCM Ltd. v. Lt. Governor, Delhi 37 (1989) DLT 425 to

contend that the workman is legally entitled to closure

compensation under the golden handshake scheme according

to which every affected workman is to be granted an amount

equivalent to six years' wages as closure compensation.

14. I am unable to agree with the contention of the counsel for the

respondent employer that the aspect of retrenchment compensation could

not have been considered for the reason of the petitioner workman having

not got the reference amended. The Industrial Adjudicator after holding

the action of the respondent employer of terminating the employment of

the petitioner workman to be bad and which would have ordinarily led to

the relief of reinstatement, held the relief of reinstatement to be not

possible for the reason of the closure. The respondent employer cannot be

heard to, on the one hand contend that owing to closure the relief of

reinstatement should be denied and on the other hand that the closure

compensation should not be considered.

15. However, I tend to agree with the contention of the counsel for the

respondent employer of the computation of compensation by the Industrial

Adjudicator being subject to judicial review only on limited grounds. This

Court would interfere in the computation of compensation only when

finding the computation to be without any basis whatsoever or perverse or

preposterous considering the facts of the case. The Industrial Adjudicator

in the present case has given reasons for computation done by him. He has

taken into consideration the period of about 4 to 5 years only for which the

petitioner workman had worked with the respondent employer, the lack of

any plea and evidence by the petitioner workman of after termination

having remained unemployed and of the possibility of the petitioner

workman continuing in the employment of the respondent employer till the

age of working being non-existent owing to the closure aforesaid.

Considering all the said factors, the thumb rule of compensation at the rate

of five years' salary last drawn was arrived at.

16. The question which arises is that, should this Court exercising power

under Article 226 of the Constitution of India interfere with such

computation. The counsel for the petitioner workman has not controverted

any of the factors aforesaid taken into consideration by the Industrial

Adjudicator for computing the compensation. The only ground is that

computation should have been at the rate of 100% of the wages from the

date of termination till closure plus closure compensation paid to others.

There is no principle of law entitling an employee to 100% back wages.

The Industrial Adjudicator even while granting reinstatement has the

discretion extending from not awarding any back wages to awarding 100%

of the back wages. The Industrial Adjudicator in the present case for the

reason of the petitioner workman having not even pleaded non

employment since termination appears to have not found the petitioner

workman entitled to any back wages. As far as compensation for

reinstatement was concerned, the Industrial Adjudicator has followed the

principle of closure compensation of 5 years' salary. The Industrial

Adjudicator has looked at the same from the alternative angle of the

compensation so awarded being equivalent to 50% of back wages and two

years' salary as compensation. The petitioner workman whose services

were terminated eight years prior to closure and who had not even pleaded

being without a job for the said eight years cannot certainly claim parity

with other employees who were rendered jobless on closure.

17. I therefore do not find any case for interference to have been made

out. I am however pained to see that even the awarded amount does not

appear to have been paid to the petitioner workman. I am surprised that the

petitioner workman in the last 12 years since when the petition has

remained pending in this Court has not even applied for release of the

money deposited in the Court. Be that as it may, the same together with

interest accrued thereon be now released to the petitioner workman

forthwith.

18. The petition is accordingly dismissed. No order as to costs.

RAJIV SAHAI ENDLAW (JUDGE) MAY 18, 2011 'gsr'..