Gujarat High Court
Narendrasinh G Vansiya Since Decd ... vs Shree Valsad Sahakari Khand Udyog ... on 13 May, 2021
Bench: Sonia Gokani
C/SCA/20076/2017 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 20076 of 2017
With
R/SPECIAL CIVIL APPLICATION NO. 6571 of 2018
With
R/SPECIAL CIVIL APPLICATION NO. 6557 of 2018
With
R/SPECIAL CIVIL APPLICATION NO. 6579 of 2018
With
R/SPECIAL CIVIL APPLICATION NO. 6576 of 2018
With
R/SPECIAL CIVIL APPLICATION NO. 6615 of 2018
With
R/SPECIAL CIVIL APPLICATION NO. 6572 of 2018
With
R/SPECIAL CIVIL APPLICATION NO. 7346 of 2021
With
R/SPECIAL CIVIL APPLICATION NO. 20450 of 2018
With
R/SPECIAL CIVIL APPLICATION NO. 20077 of 2017
With
R/SPECIAL CIVIL APPLICATION NO. 20078 of 2017
With
R/SPECIAL CIVIL APPLICATION NO. 20079 of 2017
With
R/SPECIAL CIVIL APPLICATION NO. 20080 of 2017
With
R/SPECIAL CIVIL APPLICATION NO. 20081 of 2017
With
R/SPECIAL CIVIL APPLICATION NO. 20082 of 2017
With
Page 1 of 73
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C/SCA/20076/2017 JUDGMENT
R/SPECIAL CIVIL APPLICATION NO. 20083 of 2017
FOR APPROVAL AND SIGNATURE:
HONOURABLE MS. JUSTICE SONIA GOKANI
==========================================================
1 Whether Reporters of Local Papers may be allowed to see the
YES
judgment ?
2 To be referred to the Reporter or not ? YES
3 Whether their Lordships wish to see the fair copy of the
NO
judgment ?
4 Whether this case involves a substantial question of law as to
the interpretation of the Constitution of India or any order NO
made thereunder ?
==========================================================
VALSAD SAHKARI KHAND UDYOG MANDALI LTD.
Versus
NARENDRASINH G. VANSIYA - SINCE DECEASED THROUGH LEGAL
HEIRS & 1 other(s)
==========================================================
Appearance:
Ld. Senior Advocate Mr. Gautam Joshi with MR AK Clerk(235) for the
Petitioner(s) No. 1
for the Respondent(s) No. 1.1
Mr. Dipak Dave, Learned Advocate for the Respondent(s) No. 1,2
==========================================================
CORAM:HONOURABLE MS. JUSTICE SONIA GOKANI
Date : 13/05/2021
COMMON ORAL JUDGMENT
1. These are the petitions preferred under Articles 226 and
227 of the Constitution of India by the group of petitioners. There
C/SCA/20076/2017 JUDGMENT
are cross petitions preferred by the employers and employees in
the present group of petitions, the list of which is as under: -
NAME OF THE EMPLOYEE EMPLOYEE'S EMPLOYER'S
PETITION PETITION
RAMESH KIKABHAI PATEL SCA-6571/2018 SCA- 20078/2017
SUBHASHBHAI MANGALDAS PAJWANI SCA-6557/2018 SCA-20083/2017
ISUDAS GABRIEL MACWAN SCA-6579/2018 SCA-20082/2017
KANTILAL AMRUTLAL RANA SCA-6576/2018 SCA-20079/2017
RAMASHRAYA JAMUNA YADAV SCA-6615/2018 SCA-20077/2017
GULABBHAI JIVANJI PATEL SCA-6572/2018 SCA-20080/2017
ANIL KUMAR SINH PRADDUMAN SINH SCA-20450/2018 SCA-20081/2017
NARENDRASING VANSIYA THR' HEIR SCA-7346/2018 SCA-20076/2017
2. The facts of each pair of cross cases are briefly stated before
adjudicating all these matters by a common judgement because
of involvement of identical questions of facts and law in them.
2.1. SCA 20078/2017 (by the employer) and its cross
petition SCA 6571/2018 (by the employee)
2.1.1. The employer - petitioner has challenged the judgment
and order dated 16.06.2017 of the Industrial Court, Surat in
Appeal (IC) No. 54 of 2007 aggrieved by the grant of backwages to
the tune of 70%.
C/SCA/20076/2017 JUDGMENT
According to the petitioner, the respondent - employee was
working in the engineering branch of the petitioner whose date of
birth is 24.03.1958 and he reached the age of superannuation on
24.03.2018. He was issued the charge-sheet on 19.10.1994 for
disobeying the lawful order of the superiors and after a full-fledged
inquiry, he was dismissed from service on 03.05.1995. At that
time, he was paid gratuity at the tune of Rs. 26,281/- and other
retiral benefits to the tune of Rs. 5,896.80/-. Thus, the total
amount paid to the respondent was already sent by way of a
cheque and when he chose not to accept, the petitioner has
deposited the amount of Rs. 5,896/- with Gujarat Labour Welfare
Commissioner. Therefore, direction of paying gratuity of Rs.
26,281/- with 9% interest is erroneous. Other details with regard
to the examination of witnesses and the chronology of events
baring the number of appeal and SCA preferred before this Court
being 2963 and 2966 of 2007 are identical.
2.1.2. In the cross petition preferred by the employee being
SCA 6571/2018, the petitioner seeks to challenge the very
judgement and order terming the same as illegal and unjust order
dated 21.09.2007 passed by the Labour Court, Valsad in T
Application No. 14 of 1995 as well as the order dated 16.06.2017
passed by the Industrial Court, Surat in Appeal (IC) No. 54 of 2007
C/SCA/20076/2017 JUDGMENT
and 58 of 2007.
It is the say of the petitioner herein that the co employee,
Shri Kantilal Amrutlal Rana (Petitioner of SCA 6576/18) also on
similar facts and circumstances has preferred a petition and he
seeks to depend on the details provided in that petition. It is also
averred that the Labour Court had granted permission to conduct
inquiry by the respondent management vide order dated
21.04.2005. The said order was challenged by the respondent
before the Industrial Court, Surat however, the revision
application was dismissed on 07.07.2007. Against the said order,
the present respondent had preferred Special Civil Application
Nos. 6213 to 6223 of 2008 before this Court which have been
dismissed for having become infructuous. Accordingly, the orders
became final. After the said order also, the respondent authority
did not conduct any inquiry and accordingly the respondent was
directed to reinstate the petitioner however, the petitioner was not
allowed to resume the duty and he was held entitled to place the
petitioner on suspension and to hold departmental inquiry.
Neither the petitioner was placed under suspension nor the
departmental inquiry was conducted by the respondent.
When the Labour Court noticed this aspect, it said that the
order of the Court has not been obeyed and the respondent has
C/SCA/20076/2017 JUDGMENT
not availed any opportunity nor has it conducted any domestic
inquiry. The Labour Court and Industrial Court both restricted
the relief to the extent of grant of 70% backwages.
Relying on the petition of Shri Kantilal Amrutlal Rana it is
urged that the content of the same petition also would apply in
case of the present employee. The employee remained unemployed
all throughout despite the best efforts and even after the order of
Labour Court on 28.04.2005, he was not allowed to resume the
duties, therefore, he is entitled to the full wages after 28.04.2005.
The prayers sought for by the petitioner at para 10 is to
declare that petitioner shall be entitled to the full backwages from
the date of termination until order dated 28.04.2005 passed by
the Labour Court, Valsad and from 21.04.2005, he shall be
entitled to the full wages. He further has sought for the interest at
the rate of 12% on the backwages and the arrears.
2.2. SCA 20083/2017 (by employer) and its cross petition
SCA 6557/2018 (by employee):
2.2.1. The petitioner - employer in SCA 20083/2017 seeks to
challenge the judgment and order passed in Appeal (IC) No. 59 of
2007 by the Industrial Court, Surat on 16.06.2017 on the ground
of the same being contrary to law, perverse and in disregard of the
C/SCA/20076/2017 JUDGMENT
decisions of the Apex Court.
The respondent, according to the petitioner, was working in
the agricultural branch of the petitioner. His date of birth is
23.07.1952 and he reached the age of superannuation on
23.07.2012.
For the alleged disobedience of the lawful order of the
superiors under the standing orders, a charge-sheet came to be
filed against the present respondent on 17.10.1994 and pursuant
to a full-fledged departmental inquiry, the respondent was
dismissed from service on 03.05.1995. He was paid gratuity of Rs.
28,350/- calculated up to the date of dismissal and other retiral
benefits quantified into the sum of Rs. 6,482.25/-. The said
amount of retiral benefit since had not been accepted by the
respondent herein, the same had been deposited by the petitioner.
According to the petitioner, the challenge had been made by
the respondent to the order of Labour Court, Valsad in T
Application No. 13 of 1995.
The details as have been furnished in rest of the matters are
forming the part of this petition as well which eventually seeks the
very relief of quashing and setting aside the impugned judgment
and order dated 16.06.2017 passed by the Industrial Court, Surat
in Appeal (IC) No. 59 of 2007 so also the judgment and order dated
C/SCA/20076/2017 JUDGMENT
21.09.2007 passed by the Labour Court, Valsad in T Application
No. 13 of 1995.
It is also urged that the amount of 70% of the backwages
awarded in favour of the respondent also deserves to be quashed
as no evidence has been led by the respondent herein.
2.2.2. In the cross petition preferred by the employee being
SCA 6557/2018, the petitioner- employee seeks to challenge the
orders dated 21.09.2007 passed by the Labour Court, Valsad in T
Application No. 13 of 1995 as well as the order dated 16.06.2017
passed by the Industrial Court, Surat in Appeal (IC) Nos. 56 and
59 of 2007.
It is the grievance on the part of the petitioner that the
Courts have not granted 100% back wages even after holding
everything in favour of the petitioner - employee. He has
increasingly and heavily relied on the petition of his co-employee
- Shri Kantilal Amrutlal Rana who also has preferred a petition
before this Court. According to him, all the facts and
circumstances leading to the present petition are similar.
It is his grievance that once having allowed the matters in
favour of the petitioner, and having also realized that the
petitioner was not allowed to resume the duty and he had
C/SCA/20076/2017 JUDGMENT
remained unemployed all throughout despite his best of the
efforts, he is required to be given the 100% backwages from
17.04.2005 until retirement of the petitioner. He also is further
entitled to the backwages from the date of termination until
16.04.2005. The prayers sought for at para 10 also are to that
effect.
2.3. SCA 20082/2017 and its cross petition SCA 6579/2018:
2.3.1. The petitioner - employer in SCA 20082/2017 seeking
to challenge the judgment and order of Industrial Court, Surat in
Appeal (IC) No. 65 of 2007 dated 16.06.2017 on the ground of the
same being contrary to law and perverse.
The respondent herein was working in the administration
branch of the petitioner and his date of birth was 08.11.1941. He
reached the age of superannuation on 08.11.2001. He passed
away on 11.01.2015 and his heirs were joined during the
pendency of Appeal (IC) No. 55 of 2007 however, in Appeal (IC) No.
65 of 2007, the said fact was not declared and no application for
bringing heirs was brought on the record.
According to the petitioner, on 28.10.1994 for the alleged
disobedience of the lawful order of superiors under the standing
order, a full-fledged inquiry was conducted and the respondent
C/SCA/20076/2017 JUDGMENT
was dismissed from service on 03.05.1995. He was paid the
gratuity of Rs. 29,135/- and other benefit of Rs. 6706.13/-.
The challenge was made to the dismissal order by filing T
Application No. 15 of 1995 before the Labour Court, Valsad which
eventually was quashed.
According to the petitioner, a series of judgments of the Apex
Court on the issue of back wages by the Labour Courts and
Industrial Courts have not been taken into consideration. Ignoring
the fact that the employee has not given any evidence on the issue
of back wages or the order of back wages, 70% of the back wages
have been given. Therefore, as requested for in rest of the petitions
against other employees, request is made to quash and set aside
the order of Labour Court as well as Industrial Court in Appeal
(IC) No. 65 of 2007.
2.3.2. In the cross petition preferred by the heirs of
deceased - employee Isudash Gabriel Macwan being SCA
6579/2018, they have challenged allegedly illegal and unjust
order dated 28.09.2007 passed by the Labour Court, Valsad in T
Application No. 15 of 1995 as well as the order dated 16.06.2017
passed by the Industrial Court, Surat in Appeal (IC) Nos. 55 of
2007 and 65 of 2007.
C/SCA/20076/2017 JUDGMENT
Reliance heavily is placed on the co-employee's petition
preferred before this Court of Shri Kantilal Amrutlal Rana being
SCA 6576/18 and according to the petitioners, they are also
having almost similar facts and circumstances.
The grievance is that the Labour Court had permitted to
conduct the inquiry by the respondent management dated
21.04.2005 and the said order was challenged by the respondent
management before the Industrial Court, Surat, however, the said
revision application was dismissed on 07.07.2007 and against the
said orders, the present respondent preferred Special Civil
Applications No. 6213 to 6223 of 2008 before this Court. They
were dismissed as having become infructuous and thus, the order
had become final.
It is further the grievance on the part of the petitioner that
no inquiry was conducted by the respondent and though it was
directed to reinstate the deceased husband of the petitioner no.
1/1, he was not allowed to resume the duty. The respondent was
held entitled to place the husband of the petitioner on suspension
and to hold the departmental inquiry, however, neither he was
placed under suspension nor the departmental inquiry was
conducted and thus, the respondent has chosen not to obey the
order of this Court, therefore, the grant of relief to the tune of 70%
C/SCA/20076/2017 JUDGMENT
by both the authorities is severely lamented.
The prayers sought for at para 10 are similar to what had
been sought in other matters.
2.4. SCA 20079/2017 and its cross petition by employee
being SCA 6576/2018 :-
2.4.1. The petitioner - employer in SCA 20079/2017
challenges the judgment and order dated 16.06.2017 passed by
the Industrial Court, Surat in Appeal (IC) No. 60 of 2007, where
the challenge is to the alleged perversity of the judgment which
according to the petitioner is given in complete disregard to the
judgment of the Apex Court.
It is averred that the respondent was working in the
accounts/administration branch of the petitioner. His date of
birth is 10.08.1950 and he reached the age of superannuation on
10.08.2010.
It is further averred that for alleged disobedience of the
lawful order of superiors under the standing orders, a charge-
sheet came to be issued on 17.10.1994 against the present
respondent and after a full-fledged inquiry, he was dismissed from
the service on 03.05.1995. He was paid gratuity of Rs. 28,742/-
C/SCA/20076/2017 JUDGMENT
and other retiral benefits to the tune of Rs. 5653.30/-. Challenge
was made by the respondent to the said order of dismissal and
petitioner filed the written statement in the said application
producing along with its reply the record of departmental inquiry.
It is the say of the petitioner that on 18.03.1995 the
respondent and his representatives had sought for the
adjournment and on 31.03.1995 the respondent, though was
present, the inquiry was adjourned and on 12.04.1995 the
respondent and his representatives were not present and they
were informed by the Registered Post on 14.04.1995. Since on
12.04.1995 the respondent and his representatives did not remain
present, the inquiry was concluded on that day.
Subsequently, when the respondent approached the Labour
Court vide its order dated 15.04.1995, it held the inquiry to be
vitiated and directed the employee to be reinstated in the service
to his original post and further directed the petitioner to complete
the inquiry from 12.04.1995 by placing the respondent under
suspension, however, none of these things had been followed. By
challenging it further, as detailed hereinabove, and eventually by
the judgment of the Labour Court and confirmed by the Industrial
Court, the Court had allowed the application of employees and
granted 70% of the back wages.
C/SCA/20076/2017 JUDGMENT
2.4.2. In the cross petition being SCA 6576/2018, the details
given by this employee - respondent have been followed by other
co-workers and all the issues that he has raised factually as well
as legally, according to others, are also relevant in their petitions.
2.5. SCA 20077/2017 and its cross petition SCA
6615/2018:
2.5.1. The petitioner - employer in SCA 20077/2017 - Valsad
Sahkari Khand Udhyog Mandali Limited has also challenged the
judgment and order dated 16.06.2017 passed by the Industrial
Court, Surat in Appeal (IC) No. 63 of 2007.
According to the petitioner, the respondent was working in
engineering workshop branch. His date of birth is 01.01.1954 and
he reached the age of superannuation on 01.01.2014. A charge-
Sheet was issued on 19.10.1994 for disobeying the lawful order of
the superiors under the standing orders. Pursuant to a full-
fledged departmental inquiry, the respondent was dismissed from
service on 03.05.1995 and he was paid gratuity of Rs. 27,320/-
and other benefits to the tune of Rs. 6,241.65/-
This was challenged by the respondent by preferring the T
C/SCA/20076/2017 JUDGMENT
Application No. 16 of 1995 before the Labour Court, Valsad. The
oral evidence was given in respect of the legality and validity of the
departmental inquiry by the respondent, however, on the aspect
of backwages and the issue of penalty order of dismissal, nothing
was said.
According to the petitioner, the oral evidence of the
witnesses Shri Krishnabhai Balvantbhai Desai, the Inquiry Officer
Shri Suresh Narimal Raghuvanshi and the Presenting Officer Shri
Manharlal Durlabhai Patel had been recorded. On 09.03.1995, in
the departmental inquiry, the examination and the cross
examination of the management witnesses had been concluded.
Thereafter, the respondent was informed to bring the witnesses
and inquiry was adjourned to 18.03.1995. On 18.03.1995, the
evidence of all the four witnesses had been recorded of Shri
Natvarlal Patel, Dahyalal Ranchhodbhai Patel, Kautik Uttam Ahir
and Kuldip Rai. They were cross examined by the Presenting
Officer and as the evidence of the respondent had been concluded,
the respondent had wanted to bring more witnesses and the
inquiry was adjourned to 07.04.1995. However, on 07.04.1995,
there was an election of the Credit Society of the Employees and
inquiry was adjourned to 12.04.1995.
It is the say of the petitioner that the respondent had not
C/SCA/20076/2017 JUDGMENT
given its evidence in respect of the charges levelled against him.
According to the petitioner, the Labour Court passed an order on
26.04.2005 holding that the departmental inquiry was vitiated
w.e.f. 12.04.1995 and the employee shall be reinstated on his
original post. While so holding, the petitioner - employer was also
permitted to complete the inquiry from 12.04.1995 by placing the
respondent under suspension.
This was challenged by way of Revision (IC) No. 20 of 2005
before the Industrial Court, Surat which rejected the revision vide
its order dated 09.07.2007 and against this order, Special Civil
Application No. 22645 of 2007 had been preferred.
A Review Application was also filed being (IC) No. 04 of 2007
which was rejected by the Industrial Court. The petitioner
preferred Special Civil Application No. 2965 of 2008 before this
Court and in the meantime, the Labour Court decided the T
Application No. 16 of 1995 and therefore, the petitioner withdrew
the petition being SCA 2965 of 2008.
According to the petitioner, the employee had given the
evidence only on the issue of legality and validity of the
departmental inquiry and on the issue of backwages and order of
penalty, there has been no evidence adduced by the employee,
therefore, the Labour Court has erred in granting 70% backwages
C/SCA/20076/2017 JUDGMENT
and Industrial Court also has erred in confirming the same.
The grievance is also made that the amount of gratuity and
other benefits had been sent to the employee who did not accept
the same and therefore, the same has been deposited with the
Gujarat Labour Welfare Commissioner.
The prayers sought are of quashing and setting aside the
judgment and orders of the Industrial Court and that of the
Labour Court.
2.5.2. In the cross petition preferred by the employee being
SCA 6615/2018, the employee seeks to challenge the orders of
Labour Court, Valsad in T Application No. 16 of 1995 as well as
the order passed by the Industrial Court, Surat in Appeal (IC) Nos.
53 of 2007 and 63 of 2007 dated 16.06.2017.
According to this employee, he heavily relied on the petition
of Shri Kantilal Amrutlal Rana as according to him, his grievances
are identical to what have been narrated hereinabove in case of
other employees. The prayers sought for are also identical where
the arrears of back wages as well as the arrears of wages until the
date of retirement have been sought with 12% interest rate.
2.6. SCA 20080/2017 and its cross petition SCA
C/SCA/20076/2017 JUDGMENT
6572/2018:
2.6.1. The petitioner - employer in SCA 20080/2017
challenges the judgment and order dated 16.06.2017 passed by
the Industrial Court, Surat in Appeal (IC) No. 61 of 2007 on the
ground of the same being erroneous, perverse and in disregard of
the decisions of the Apex Court.
According to the petitioner, the respondent was working in
the agricultural branch of the petitioner. His date of birth is
01.06.1949 and he has reached the age of superannuation on
01.06.2009. It is alleged that for disobeying of the lawful order of
superiors, a charge-sheet came to be filed on 14.11.1994 against
the respondent who replied to the same on 16.11.1994 and a full-
fledged inquiry was conducted which resulted into his dismissal
from service on 03.05.1995. He was paid gratuity of Rs. 32,562/-
and other retiral benefits in the quantification of Rs. 6,627/-.
The challenge of the same was made by way of T Application
No. 19 of 1995 before the Labour Court, Valsad and eventually the
Labour Court held the departmental inquiry to have been vitiated
on 12.04.1995. It also further directed the employee to be
reinstated to his original post and directed the petitioner to
complete the inquiry from 12.04.1995.
C/SCA/20076/2017 JUDGMENT
The rest of the averments are similar to what have been
averred in other petitions with identical facts and circumstances.
Eventually what has been sought is to quash and set aside the
judgment and order dated 16.06.2017 passed by the Industrial
Court, Surat in Appeal (IC) No. 61 of 2007 as also to re-look at the
approach of the Court concerned of grant of 70% of backwages.
2.6.2. In the cross petition preferred by the employee -
Gulabbhai Jivanjibhai Patel being SCA 6572/2018, his grievances
are against the grant of 70% of the back wages by both the Courts
being Labour Court, Valsad in T Application No. 19 of 1995 as well
as the Industrial Court, Surat in Appeal (IC) Nos. 50 of 2007 and
61 of 2007 vide its judgment and order dated 16.06.2017.
According to this employee, the co-employee - Shri Kantilal
Amrutlal Rana's petition has similar details as those of his and
the permission of conducting the inquiry by the respondent
management vide order of Labour Court dated 03.05.2005,
according to him, had not been abided by. The challenge was
made by the employer before the Industrial Court and the Revision
Application also was dismissed on 07.07.2007. The Special Civil
Applications No. 6213 to 6223 of 2008 preferred before this Court
had become infructuous eventually.
C/SCA/20076/2017 JUDGMENT
It is the say of the respondent that the employer had been
though directed to reinstate the employee, he was not allowed to
resume the duty and the petitioner was also permitted to hold the
departmental inquiry while placing the respondent under
suspension and yet, neither the respondent was placed under
suspension nor the departmental inquiry was conducted, as was
directed. The Labour Court and Industrial Court both have held
that despite having availed the opportunity to the Petitioner, it had
chosen not to obey the order and yet the relief granted eventually
restricted to the grant of backwages to 70%.
According to this respondent, the age of retirement was 60
years and the retiral benefits have been restricted to a meagre
amount of gratuity and that too, had been restricted up to the year
1995 when the termination had taken place. It is the grievance
that when there has been a contemptuous defiance of the order
passed by all the Courts, the eventual relief is contrary to the
directions and observations and therefore, deserves indulgence.
It has sought to seek the prayers of issuance of writ of
certiorari or any other writ and has sought the full back wages
from the date of termination until the order dated 03.05.2005 and
from 04.05.2005, he has sought full back wages. It has also
sought the arrears of wages until the date of retirement with
C/SCA/20076/2017 JUDGMENT
interest at the rate of 12%.
2.7. SCA 20081/2017 and its cross petition SCA
20450/2018: -
2.7.1. The petitioner - employer in SCA 20081/2017 seeks to
challenge the judgment and order dated 16.06.2017 passed by the
Industrial Court, Surat in Appeal (IC) No. 64 of 2007 being
aggrieved by the grant of 70% of backwages as also for other reliefs
granted in favour of the respondent.
It is the say of the petitioner that the respondent was
working in an engineering workshop branch of the petitioner. His
date of birth is 01.01.1954 and he reached the age of
superannuation on 01.01.2014. For the alleged disobeying of the
lawful order of superiors, he was issued the charge-sheet
19.10.1994 and was dismissed from the service on 03.05.1995.
He was paid gratuity of Rs. 25,000/- and other retiral benefits to
the tune of Rs. 5354.55/- This the employee had not accepted and
therefore, the same had been kept by the petitioner with the
Gujarat Labour Welfare Commissioner. Thus, when the amount
of retiral benefit to the tune of Rs. 5354.55/- has been deposited,
no interest should run. The amount of gratuity with 9% interest
is also, according to the petitioner, exorbitant.
C/SCA/20076/2017 JUDGMENT
The challenge to the judgment and order of the Labour Court
and that of the Industrial Court along the line of the other
petitions which have been preferred by the very employer.
2.7.2. The employee in its cross petition (SCA
20450/2018), is aggrieved by the order of Labour Court, Valsad
dated 28.09.2007 in T Application No. 17 of 1995 as well as the
order dated 16.06.2017 passed by the Industrial Court, Surat in
Appeal (IC) Nos. 52 of 2007 and 64 of 2007.
He also has relied on the co-employee's petition being SCA
6576/18 for the purpose of challenge to the judgement and order
mentioned hereinabove.
According to the respondent, when the order of this Court in
Special Civil Applications No. 6213 to 6223 of 2008 had also not
been abided by and he was not permitted to resume the duty, as
was directed by both the Courts up to the revision and thereafter
by non-interference of the High Court in this regard, not only
nothing was done at the end of employer, but, instead it had
ensured that the employee attains the age of superannuation.
The respondent, therefore, has made a grievance that both
the Courts below ought to have granted the consequential back
wages as well as the wages and other retiral benefits bearing in
C/SCA/20076/2017 JUDGMENT
mind the conduct of the respondent authority. He also has sought
the prayers as have been mentioned above in case of others at
para 10.
❖ SCA 20076/2017 (OF EMPLOYER) AND SCA 7346/2021
(OF EMPLOYEE)
3. For the purpose of adjudication, the facts are drawn from
Special Civil Application No. 20076 of 2017 essentially and
reference of SCA 7346/21, wherever necessary, shall be given in
this petition.
4. The challenge in this petition is to the judgment and order
dated 16.06.2017 passed by the Industrial Court, Surat in Appeal
(IC) No. 62 of 2007 on the ground of the same being erroneous,
contrary to law, perverse and in disregard to the judgments of the
Apex Court and this Court.
4.1. The father of respondent was working in the agricultural
branch of the petitioner. The date of birth of the employee was
12.11.1951 and he reached the age of superannuation on
12.11.2011. He was charge-sheeted on 14.11.1994 for disobeying
the lawful orders of the superior under the standing orders. The
C/SCA/20076/2017 JUDGMENT
employee was dismissed from service on 03.05.1995 after full-
fledged inquiry. The amount of payment made to him was of
gratuity to the tune of Rs. 24,106/- and other benefits given were
quantified to the sum of Rs. 6,047.20/-. Son of the employee has
been impleaded as the party respondent as the employee died on
08/12/2017. Employee Narendrasinh's wife and mother of the
present respondent also passed away on 28.07.2001. He was
survived by two heirs and his daughter Hiralkumari
Satyendrasinh has forgone her right in favour of her brother, the
present Respondent, Digvijaysinh Narendrasinh. At the request of
the Petitioner, the son of the deceased employee has been
permitted to be joined as the respondent in place of the employee.
4.2. This action on the part of the petitioner had been challenged
by filing T Application No. 18 of 1995 before the Labour Court,
Valsad. The challenge on the part of the respondent - employee
was in respect of legality and validity of the departmental inquiry,
however, according to the Petitioner, nothing in relation to the
issue of penalty order of dismissal or back wages was questioned.
The grievance on the part of the petitioner is that the oral evidence
of the inquiry officer had been recorded on the issue of legality and
validity of the departmental inquiry, although, the respondent is
obligated to lead the evidence. The election of the credit society of
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the employees came in between and therefore, there was no
evidence adduced in respect of the charges levelled against him.
The respondent - employee gave pursis declaring that the evidence
of the inquiry officer in T Application Nos. 12 of 1995 and 13 of
1995 along with the cross-examination be taken on the record and
be exhibited. The Labour Court allowed such application and
thereafter, held that the departmental proceedings had been
vitiated. It also directed the petitioner to reinstate the respondent
to his original post with a further direction to complete holding of
inquiry by placing the respondent under suspension.
4.3. This had aggrieved the petitioner who preferred Revision
(IC) No. 22 of 2005 before the Industrial Court, Surat which
rejected the said application on 09.07.2007.
4.4. Being further aggrieved by the same, the petitioner has
preferred Special Civil Application No. 22644 of 2007 against the
said order of revision. The petitioner also preferred Review (IC) No.
10 of 2007 which was rejected by the Industrial Court. That also
was challenged by way of a separate petition being Special Civil
Application No. 2962 of 2008 before this Court. In the meantime,
the Labour Court decided the T Application No. 18 of 1995.
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4.5. Against the judgment and award of the Labour Court,
Valsad rendered in T Application No. 18 of 1995, the petitioner
preferred Appeal (IC) No. 62 of 2007 before the Industrial Court,
Surat. The respondent also preferred Appeal (IC) No. 51 of 2007
challenging the very judgment and award passed by the Labour
Court, where the Industrial Court, Surat delivered the judgment
and order on 16.06.2017 in both the appeals being Appeal (IC) No.
62 of 2007 and Appeal (IC) No. 51 of 2007 jointly. This has
aggrieved the petitioner who has challenged the same by way of
present petition and accordingly, has prayed for the following
reliefs: -
"(a) Quashing and setting aside the impugned
judgment and order dated 16.06.2017 passed by the
Industrial Court, Surat in Appeal (IC) No. 62 of 2007.
(b) Quashing and setting aside the impugned
judgment and order dated 20.09.2007 passed by the
Labour Court, Valsad in T Application No. 18 of 95.
(c) Granting such other and further reliefs and
passing such other and further orders as may be
necessary in the facts and circumstances of the case.
(d) During the pendency and final disposal of this
petition Your Lordships may be pleased to pass an
order staying the operation and implementation of the
judgment and order dated 16.06.17 passed by the
Industrial Court Surat in Appeal (IC) No. 62 of 2007 and
judgment and order dated 20.09.2007 passed by the
Labour Court, Valsad in T Application No. 18 of 95."
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5. It is the grievance on the part of the petitioner that the
Labour Court has materially erred in ignoring that no evidence is
adduced on the part of the employee on the issue of back wages
and the order of grant of more amount of gratuity. Evidence merely
on the aspects of legality and validity of departmental proceedings
without a semblance of evidence on back wages cannot be termed
sufficient. In absence of any evidence otherwise, grant of 70%
back wages is totally erroneous. Several factors which are
otherwise necessary to be regarded by the Court concerned have
been overlooked. Three witnesses had been examined by the
petitioner for proving the misconduct of the employee. The
application also was tendered to the effect that departmental
inquiry had been conducted by the petitioner by leading cogent
evidence, however, the evidence in relation to the said proceedings
in post 31.03.1995 period has not been duly proved. The
application to that effect (Exh.70) had been tendered where the
other side had objected to exhibit the same on the ground that the
same has not been proved.
5.1. It is further the say of the petitioner that it is wrong on the
part of the Court to hold that the petitioner has not availed
opportunity to prove the charges against the employee. The Court
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also, according to the petitioner, has wrongly paid the gratuity
with 9% interest when the amount was already sent to the
employee which had not been accepted and the same had been
returned to the petitioner. Similarly, the amount of other benefits
also had been sent to the employee had not been accepted and
therefore, the petitioner had deposited the same with the Gujarat
Labour Welfare Commission. Therefore, the interest at the rate of
9% is not desirable. The Court materially faulted in ignoring that
the financial condition of the petitioner which is not sound and
the petitioner is continuously incurring loss. Audit balance-sheet
also is reflecting the said fact and therefore, the award of 70%
back wages was undesirable.
6. On issuance of notice on 07.12.2017, learned advocate Mr.
Deepak Dave appeared for the respondent - employee. The
respondent had also filed a cross petition being Special Civil
Application No.7346 of 2021 where the challenge on the part of
the respondent - legal heir of the employee is of non-grant of the
full back wages as also of grant of meager amount of gratuity
without availing any other retiral benefits.
7. Both the sides have been heard extensively by this Court.
They also have tendered their respective written arguments.
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8. Learned advocate Mr. A.K.Clerk appearing for the petitioner
has strenuously urged that the judgment of the Labour Court as
well as Industrial Court in relation to the misconduct, suffer from
serious error of jurisdiction. The inquiry conducted by the
petitioner - management was held to be vitiated from 12.04.1995.
It would mean that those proceedings conducted till 31.03.1995
were absolutely legal and proper. There are sufficient evidence led
by the management to prove the misconduct. The findings of the
adjudicatory body to the effect that the proceedings have been
vitiated from 12.04.1995 were on the basis of the contention of
the delinquent workmen who according to the respondents, did
not get the opportunity to lead the evidence in support of their
case. It is grievance that the workmen did not enter the witness
box nor had led the evidence which by no stretch of imagination
can be termed as absence of opportunity during the inquiry. The
proceedings of the inquiry conducted till 31.03.1995 are already
on record so far as the charges which are held to be proved and
hence, the findings of the Court recording contrary to what has
been furnished in terms of the record, is a serious error of
jurisdiction.
8.1. According to the petitioner, in absence of any action on the
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part of the respondent - employee, misconduct stand proved on
the basis of the evidence led by the Inquiry Officer and hence, it
was not open to the Labour Court or the Industrial Court to come
to a conclusion that the misconduct was not proved as reported
in case of U.P State Road Transport Corporation v. Vinod Kumar.
[(2008) 1 SCC 115].
8.2. It is lamented that the directions of the Labour Court on the
question of back wages suffered from the serious error of the
jurisdiction as none of the respondents- workmen had led any
evidence on the question of back wages. Learned advocate has
relied upon the decision of P. Kaupaiah vs. Thruuvalluvar
Transport Corporation Limited [2018 (12) SCC 663] in support of
his submission.
8.3. It is further submitted that the reliance on the part of the
Labour Court on its own interim direction of reinstatement is
incorrect in as much as what is important is the final judgment of
adjudication. It is also urged that this Court needs to examine that
when only the legality and validity of the inquiry proceedings had
been challenged, the directions in relation to the back wages could
not have been examined by the Court below. It was obligatory for
the workmen to lead evidence on the question of alleged
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misconduct and the punishment that has been imposed. When
the Respondent leads the evidence only in respect of denial of
opportunity on 12.04.1995 instead of leading evidence before the
Inquiry Officer in respect of its defense, such stand of the
respondent should not be countenanced.
8.4. What has been argued by the petitioner in nutshell is that
the misconduct is proved by the management by examining the
witnesses before the Inquiry Officer which made it clear that the
respondent did not want to examine any other witness. The
workman never examined any of witnesses in the inquiry. The only
witness who was present was cross-examined on 31.03.1995. The
respondent chose not to examine himself or any of the witnesses
on the question of misconduct, role or the surrounding
circumstances or anything in relation to the back wages, in
absence of any such evidence, it was not open for the Labour
Court to hold that the misconduct is not proved. While so holding,
it has also ignored the settled position of law that once the
misconduct is held to have been proved in the departmental
inquiry on the basis of some evidence, it could not have allowed
the benefits of reinstatement and back wages as is done here.
More so, when the adjudicating authority, i.e. the labour court
holds that the inquiry till 31.03.1995 was legal and valid, no relief
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of reinstatement could have been granted and even if such a relief
was necessitated, surely the back wages could not have been
awarded. The scope of proceedings clearly barred grant of any
relief or awarding the amount of gratuity and other benefits in
monetary terms which had been sent to the workman who refused
to accept the same and therefore, the same had been deposited
with the Gujarat Labour Welfare Fund. There is no question of
grant of interest and such request is unsustainable.
8.5. Learned advocate Mr. Clerk has relied on the following other
judgments in support of his arguments: -
(i) Food Corporation of India Workers Union vs. Food
Corporation of India and Another [1996 (9) SCC 439];
(ii) J.K Synthetics Limited vs. K P Agrawal [2007 (2) SCC 433];
(iii) Prem Chandra Agarwal vs. Uttar Pradesh Financial
Corporation and Others [2009 (11) SCC 479];
(iv) State of Punjab vs. Labour Court, Jullundur [1980(1)SCC 4]
9. Learned advocate Mr. Dave appearing for and on behalf of
respondent, who is also the petitioner in Special Civil Application
No. 6576 of 2018, has tendered his written submissions, which
deserves reference at this stage.
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9.1. It is the say of the respondent - employee that two orders
have been challenged on the part of the employer, one passed by
the Labour Court, Surat in T Application as well as another passed
by the Industrial Court, which virtually confirmed the said order
modifying the award of the Labour Court by curtailing the retiral
benefits to certain extent. The respondent - employee, therefore,
has preferred the petition to the extent that full backwages have
not been granted and Industrial Court has granted meager sum
of gratuity without any other retiral benefits.
9.2. According to the respondent, all the employees have retired
and three of them have also died. They are clamoring for justice
since several years. They are victims of the unfair labour practice
adopted by the employer. According to the respondent, the
petition deserves to be dismissed on the ground of serious
suppression of facts. The employer has preferred several revision
applications before the Industrial Court during the pendency of
proceedings, challenging the interim orders of the Labour Court.
The employer also had preferred Special Civil Application No.
11544 of 2005 along with other allied matters where this Court
had confirmed the order of Labour Court of reinstatement which
had been confirmed by the Industrial Court. This Court on
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26.07.2005 has observed specifically that there was a
victimization and unfair labour practices were adopted on the part
of the employer. In case of two employees (i) Kantilal A. Rana
(Petitioner in SCA No. 6576 of 2018 and the respondent in SCA
No. 20076 of 2017) and (ii) Subhashbhai M. Panjwani (Petitioner
in SCA No. 6557 of 2018 and the respondent in SCA No. 20083 of
2017), the Labour Court had held that employer had absolutely
on false ground initiated the inquiry and the orders of termination
of the said employees were illegal. They were not only directed to
be reinstated, but, the back wages were also required to be
decided by way of interim order dated 15.04.2005. At an interim
stage itself, the Court had directed the reinstatement. It also did
not permit, considering the gross facts, to allow conducting of the
inquiry as the allegation against those two employees who are
Union Representatives was to an effect that they were not in
service for half a day and for the said charge, salary was also
deducted.
9.3. In SCA No. 11544 of 2005 and SCA 11547 of 2005, this
Court has observed the conduct of the employer by holding that
the order of dismissal was illegal and arbitrary. There is no
challenge in the Letters Patent Appeal and such findings and
observations have attained the finality. It is clearly reflective of the
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unfair labour practice on the part of the petitioner - employer.
9.4. Another grievance on the part of the respondent is that
though the petition of the employer had been dismissed at every
level, the employees had not been permitted to join the duties. All
the employees were intimated that since the proceedings are
pending, the employees were not permitted to resume the duties.
The pursis to that effect were also filed before the Labour Court.
The interim orders were also challenged and they were dragged
into litigations so that the employees reach the age of
superannuation. The Industrial Court also has observed all these
aspects and unhealthy designs of the employer.
9.5. It is further emphasized on the part of the respondent that
after the date of reinstatement, there is no question of back wages
but only the question of wages. Thus, until May, 2005 the
employer was required to pay 70% back wages as per the
direction, however, after May, 2005 where despite the valid order
of the Labour Court, confirmed by the Industrial Court, the
employer did not allow the employees to resume the duties, 100%
wages, as if the employees are in service, will be required to be
granted.
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9.6. As a trite law, no one can be permitted to reap benefit of its
own wrong. It is further his say that action of the employer being
highly arbitrary, the full back wages are needed to be given from
their illegal termination and in case from April, 2005 until
death/retirement.
9.7. It is the grievance on the part of the respondent that the
Industrial Court has restricted the retiral benefits to the extent of
gratuity only and that too, the amount which is quite meager.
Hence, the full gratuity, leave encashment and all other retiral
benefits unless given, no fruitful gains can be obtained of its
success in the litigation by the respondent - employees. The action
of the employer is unjustified, illegal and that of victimization. It
is further submitted that employees are in the evening of their life
and three of them have died. Not a single rupee so far has been
paid to them. These persons have taken participation in the union
activities and therefore, they have been victimized. There was a
deliberate attempt to initiate inquiry without availing the
opportunity. There was an absolute high handedness on the part
of the employer. All these aspects, cumulatively, suggest that the
employer would not be required to be granted any relief by the
Court.
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9.8. In view of the concurrent findings, it is submitted that the
dismissal/termination is illegal and no interference is desirable.
In fact, there had been retiral benefits required to be counted as
if the employees have put in continuous service for all these years.
Therefore, the Industrial Court could not have restricted itself to
the amount of gratuity only. It is further the say of the employees
that full wages are required to be allowed since the order has
attained finality and from the date of directions until May, 2005,
the employees are required to be paid full wages in view of the
illegal action on the part of the employer.
9.9. According to the respondent - employee, it is wrong to
contend that there is no evidence produced by the employees.
They were unemployed and were got out from the employment by
the employer itself. Several pursis were filed before the Labour
Court for allowing the employees to resume the duties. The letters
were also addressed to the employer by the employees that they
may be allowed to resume duty, however, despite that, they were
not permitted and therefore, the full back wages are necessary.
9.10. It is further stated by learned advocate Mr. Dipak Dave
that all the employees have retired and he emphasized that
retirement benefits have not been given. There are five litigations
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and no amount of wages were given to them since they are held to
be retired.
10. So far as other employees are concerned, more or less on the
same line, the employees have made their submissions. In case of
the employer also, the stand, legally as well as factually remains
virtually identical.
11. Having thus heard both the sides and also having carefully
examined the material on record, it is to be noted that, against the
judgment and award passed by the Labour Court, the challenge
has been made by both the sides, where essentially the challenge
on the part of the employer is of the authority having exceeded the
jurisdiction and the only challenge on the part of the employee
was to the legality and validity of the departmental proceedings,
absence of leading of any evidence on the part of the employee is
also another error and it is further urged by the employer that no
directions of the back wages or any retiral benefits would be
feasible in as much as there has been no error to that effect in any
of the litigations.
12. The Court cannot be oblivious of the fact that there are two
Courts who have concurrently decided in respect of legality and
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validity of the inquiry. So far as the consequential benefits are
concerned, both the Courts defer slightly, however, for present,
parameters which have been set-out for the interference of this
Court in the following decisions shall need to be regarded.
12.1. At the outset, the Court needs to take into consideration
the judgment rendered by the Apex Court in case of Shalini
Shyam Shetty and Another vs. Rajendra Shankar Patil [2010
AIR SCW 6387], where the Apex Court has held thus:-
"33. The High Court's power of superintendence under
Article 227 of the Constitution has its origin as early as
in Indian High Courts Act of 1861. This concept of
superintendence has been borrowed from English Law.
34. The power of superintendence owes its origin to the
supervisory jurisdiction of King's Bench in England. In
the Presidency towns of the then Calcutta, Bombay,
Madras initially Supreme Court was established under
the Regulating Act of 1793. Those Courts were
endowed with the power of superintendence, similar to
the powers of Kings Bench under the English Law. Then
the Indian High Courts in three Presidency towns were
endowed with similar jurisdiction of superintendence.
Such power was conferred on them under Section 15 of
the Indian High Courts Act, 1861.
35. Section 15 of the Indian High Courts Act of 1861
runs as under:
"15. Each of the High Courts established under this Act
shall have superintendence over all Courts which may
be subject to its Appellate Jurisdiction, and shall have
Power to call for Returns, and to direct the Transfer of
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any Suit or Appeal for any such Court to any other
Court of equal or superior Jurisdiction, and shall have
Power to make and issue General Rules for regulating
the Practice and Proceedings of such Courts, and also
to prescribe Forms for every Proceeding in the said
Courts for which it shall think necessary that a form be
provided, and also for keeping all Books, Entries, and
Accounts to be kept by the officers, and also to settle
Tables of Fees to be allowed to the Sheriff, Attorneys,
and all Clerks and Officers of Courts, and from Time to
Time to alter any such Rule or Form or Table; and the
Rules so made, and the Forms so framed, and the
Tables so settled, shall be used and observed in the
said Courts, provided that such General Rules and
Forms and Tables be not inconsistent with the
Provisions of any law in force, and shall before they are
issued have received the Sanction, in the Presidency of
Fort William of the Governor-General in Council, and in
Madras or Bombay of the Governor in Council of the
respective Presidencies."
48. The subsequent Constitution Bench decision of this
Court on Article 227 of the Constitution, rendered in the
case of State of Gujarat etc. vs. Vakhatsinghji
Vajesinghji Vaghela (dead) his legal representatives
and others reported in AIR 1968 SC 1481 also
expressed identical views. Justice Bachawat speaking
for the unanimous Constitution Bench opined that the
power under Article 227 cannot be fettered by State
Legislature but this supervisory jurisdiction is meant to
keep the subordinate tribunal within the limits of their
authority and to ensure that they obey law.
49. So the same expression namely to keep the Courts
and Tribunals subordinate to the High Court `within the
bounds of their authority' used in Manmatha Nath
Biswas (supra), to indicate the ambit of High Court's
power of superintendence has been repeated over
again and again by this Court in its Constitution Bench
decisions.
50. Same principles have been followed by this Court in
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the case of Mani Nariman Daruwala @ Bharucha
(deceased) through Lrs. & others vs. Phiroz N. Bhatena
and others etc. reported in (1991) 3 SCC 141, wherein
it has been held that in exercise of its jurisdiction under
Article 227, the High Court can set aside or reverse
finding of an inferior Court or tribunal only in a case
where there is no evidence or where no reasonable
person could possibly have come to the conclusion
which the Court or tribunal has come to. This Court
made it clear that except to this `limited extent' the High
Court has no jurisdiction to interfere with the findings
of fact (see para 18, page 149-150).
51. In coming to the above finding, this Court relied on
its previous decision rendered in the case of
Chandavarkar Sita Ratna Rao vs. Ashalata S. Guram
reported in (1986) 4 SCC 447. The decision in
Chandavarkar (supra) is based on the principle of the
Constitution Bench judgments in Waryam Singh (supra)
and Nagendra Nath (supra) discussed above.
52. To the same effect is the judgment rendered in the
case of Laxmikant Revchand Bhojwani and another vs.
Pratapsingh Mohansingh Pardeshi reported in (1995) 6
SCC 576. In paragraph 9, page 579 of the report, this
Court clearly reminded the High Court that under Article
227 that it cannot assume unlimited prerogative to
correct all species of hardship or wrong decisions. Its
exercise must be restricted to grave dereliction of duty
and flagrant abuse of fundamental principle of law and
justice (see page 579-580 of the report).
53. Same views have been taken by this Court in
respect of the ambit of High Court's power under Article
227 in the case of Sarpanch, Lonand Grampanchayat
vs. Ramgiri Gosavi and another, reported in AIR 1968
SC 222, (see para 5 page 222-234 of the report) and the
decision of this Court in Jijabai Vithalrao Gajre vs.
Pathankhan and others reported in (1970) 2 SCC 717.
The Constitution Bench ratio in Waryam Singh (supra)
about the scope of Article 227 was again followed in
Ahmedabad Manufacturing & Calico Ptg. Co. Ltd. vs.
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Ram Tahel Ramnand and others reported in (1972) 1
SCC 898.
54. In a rather recent decision of the Supreme Court in
case of Surya Dev Rai vs. Ram Chander Rai and others,
reported in (2003) 6 SCC 675, a two judge Bench of this
Court discussed the principles of interference by High
Court under Article 227. Of course in Surya Dev Rai
(supra) this Court held that a writ of Certiorari is
maintainable against the order of a civil Court,
subordinate to the High Court (para 19, page 668 of the
report). The correctness of that ratio was doubted by
another Division Bench of this Court in Radhey Shyam
and another vs. Chhabi Nath and others [(2009) 5 SCC
616] and a request to the Hon'ble Chief Justice for a
reference to a larger Bench is pending. But in so far as
the formulation of the principles on the scope of
interference by the High Court under Article 227 is
concerned, there is no divergence of views.
55. In paragraph 38, sub-paragraph (4) at page 695 of
the report, the following principles have been laid down
in Surya Dev Rai (supra) and they are set out:
"38 (4) Supervisory jurisdiction under Article 227 of the
Constitution is exercised for keeping the subordinate
courts within the bounds of their jurisdiction. When a
subordinate Court has assumed a jurisdiction which it
does not have or has failed to exercise a jurisdiction
which it does have or the jurisdiction though available
is being exercised by the Court in a manner not
permitted by law and failure of justice or grave injustice
has occasioned thereby, the High Court may step in to
exercise its supervisory jurisdiction."
56. Sub-paras (5), (7) and (8) of para 38 are also on the
same lines and extracted below: "(5) Be it a writ of
certiorari or the exercise of supervisory jurisdiction,
none is available to correct mere errors of fact or of law
unless the following requirements are satisfied: (i) the
error is manifest and apparent on the face of the
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proceedings such as when it is based on clear
ignorance or utter disregard of the provisions of law,
and (ii) a grave injustice or gross failure of justice has
occasioned thereby. (6) xxx xxx (7) The power to issue a
writ of certiorari and the supervisory jurisdiction are to
be exercised sparingly and only in appropriate cases
where the judicial conscience of the High Court dictates
it to act lest a gross failure of justice or grave injustice
should occasion. Care, caution and circumspection
need to be exercised, when any of the abovesaid two
jurisdictions is sought to be invoked during the
pendency of any suit or proceedings in a subordinate
court and the error though calling for correction is yet
capable of being corrected at the conclusion of the
proceedings in an appeal or revision preferred
thereagainst and entertaining a petition invoking
certiorari or supervisory jurisdiction of the High Court
would obstruct the smooth flow and/or early disposal
of the suit or proceedings. The High Court may feel
inclined to intervene where the error is such, as, if not
corrected at that very moment, may become incapable
of correction at a later stage and refusal to intervene
would result in travesty of justice or where such refusal
itself would result in prolonging of the lis.
(8) The High Court in exercise of certiorari or supervisory
jurisdiction will not covert itself into a Court of Appeal
and indulge in re-appreciation or evaluation of evidence
or correct errors in drawing inferences or correct errors
of mere formal or technical character."
57. Articles 226 and 227 stand on substantially
different footing. As noted above, prior to the
Constitution, the Chartered High Courts as also the
Judicial Committee of the Privy Council could issue
prerogative writs in exercise of their original
jurisdiction. [See 1986 (suppl.) SCC 401 at page 469)].
58. However, after the Constitution every High Court
has been conferred with the power to issue writs under
Article 226 and these are original proceeding. [State of
U.P. and others vs. Dr. Vijay Anand Maharaj - AIR 1963
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SC 946, page 951].
59. The jurisdiction under Article 227 on the other hand
is not original nor is it appellate. This jurisdiction of
superintendence under Article 227 is for both
administrative and judicial superintendence. Therefore,
the powers conferred under Articles 226 and 227 are
separate and distinct and operate in different fields.
62. On an analysis of the aforesaid decisions of
this Court, the following principles on the exercise
of High Court's jurisdiction under Article 227 of
the Constitution may be formulated:
(a) A petition under Article 226 of the Constitution
is different from a petition under Article 227. The
mode of exercise of power by High Court under
these two Articles is also different.
(b) In any event, a petition under Article 227
cannot be called a writ petition. The history of the
conferment of writ jurisdiction on High Courts is
substantially different from the history of
conferment of the power of Superintendence on
the High Courts under Article 227 and have been
discussed above.
(c) High Courts cannot, on the drop of a hat, in
exercise of its power of superintendence under
Article 227 of the Constitution, interfere with the
orders of tribunals or Courts inferior to it. Nor can
it, in exercise of this power, act as a Court of
appeal over the orders of Court or tribunal
subordinate to it. In cases where an alternative
statutory mode of redressal has been provided,
that would also operate as a restrain on the
exercise of this power by the High Court.
(d) The parameters of interference by High Courts
in exercise of its power of superintendence have
been repeatedly laid down by this Court. In this
regard the High Court must be guided by the
principles laid down by the Constitution Bench of
this Court in Waryam Singh (supra) and the
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principles in Waryam Singh (supra) have been
repeatedly followed by subsequent Constitution
Benches and various other decisions of this Court.
(e) According to the ratio in Waryam Singh (supra),
followed in subsequent cases, the High Court in
exercise of its jurisdiction of superintendence can
interfere in order only to keep the tribunals and
Courts subordinate to it, `within the bounds of
their authority'.
(f) In order to ensure that law is followed by such
tribunals and Courts by exercising jurisdiction
which is vested in them and by not declining to
exercise the jurisdiction which is vested in them.
(g) Apart from the situations pointed in (e) and (f),
High Court can interfere in exercise of its power
of superintendence when there has been a patent
perversity in the orders of tribunals and Courts
subordinate to it or where there has been a gross
and manifest failure of justice or the basic
principles of natural justice have been flouted.
(h) In exercise of its power of superintendence
High Court cannot interfere to correct mere errors
of law or fact or just because another view than
the one taken by the tribunals or Courts
subordinate to it, is a possible view. In other
words the jurisdiction has to be very sparingly
exercised.
(i) High Court's power of superintendence under
Article 227 cannot be curtailed by any statute. It
has been declared a part of the basic structure of
the Constitution by the Constitution Bench of this
Court in the case of L. Chandra Kumar vs. Union
of India & others, reported in (1997) 3 SCC 261
and therefore abridgement by a Constitutional
amendment is also very doubtful.
(j) It may be true that a statutory amendment of a
rather cognate provision, like Section 115 of the
Civil Procedure Code by the Civil Procedure Code
(Amendment) Act, 1999 does not and cannot cut
down the ambit of High Court's power under
Article 227. At the same time, it must be
remembered that such statutory amendment does
not correspondingly expand the High Court's
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jurisdiction of superintendence under Article 227.
(k) The power is discretionary and has to be
exercised on equitable principle. In an
appropriate case, the power can be exercised suo
motu.
(l) On a proper appreciation of the wide and
unfettered power of the High Court under Article
227, it transpires that the main object of this
Article is to keep strict administrative and
judicial control by the High Court on the
administration of justice within its territory.
(m) The object of superintendence, both
administrative and judicial, is to maintain
efficiency, smooth and orderly functioning of the
entire machinery of justice in such a way as it
does not bring it into any disrepute. The power of
interference under this Article is to be kept to the
minimum to ensure that the wheel of justice does
not come to a halt and the fountain of justice
remains pure and unpolluted in order to maintain
public confidence in the functioning of the
tribunals and Courts subordinate to High Court.
(n) This reserve and exceptional power of judicial
intervention is not to be exercised just for grant of
relief in individual cases but should be directed
for promotion of public confidence in the
administration of justice in the larger public
interest whereas Article 226 is meant for
protection of individual grievance. Therefore, the
power under Article 227 may be unfettered but its
exercise is subject to high degree of judicial
discipline pointed out above.
(o) An improper and a frequent exercise of this
power will be counter-productive and will divest
this extraordinary power of its strength and
vitality."
80. We may also observe that in some High Courts there
is tendency of entertaining petitions under Article 227
of the Constitution by terming them as writ petitions.
This is sought to be justified on an erroneous
appreciation of the ratio in Surya Dev (supra) and in
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view of the recent amendment to Section 115 of the Civil
Procedure Code by Civil Procedure Code (Amendment)
Act, 1999. It is urged that as a result of the amendment,
scope of Section 115 of CPC has been curtailed. In our
view, even if the scope of Section 115 CPC is curtailed
that has not resulted in expanding High Court's power
of superintendence. It is too well known to be reiterated
that in exercising its jurisdiction, High Court must follow
the regime of law.
81. As a result of frequent interference by Hon'ble High
Court either under Article 226 or 227 of the Constitution
with pending civil and at times criminal cases, the
disposal of cases by the civil and criminal courts gets
further impeded and thus causing serious problems in
the administration of justice.
13. It is thus clear that when there is a patent perversity in the
orders of tribunals and Courts subordinate to the High Court and
when there has been a gross and manifest failure of justice or
flouting of basic principles of natural justice, for mere correction
of law or fact or just because another view is feasible than the one
taken by the tribunal or subordinate Court, no interference is
desirable. In a nutshell, it is emphasized that power of
superintendence under Article 227 of the Constitution of India
though cannot be curtailed, such jurisdiction shall have to be
exercised sparingly. This Court is not to exercise the powers as a
Court of appeal on the order of tribunals.
14. Considering the broad principles which have been laid down
in case of Shalini Shyam Shetty (Supra), which has been
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reiterated in subsequent decisions, this Court is not to sit in an
appeal nor is it required to exercise the powers under Article 227
because there is a possibility of taking different view from the
evidence which has been adduced before the Labour Court or the
Industrial Court, as the object of superintendence, both
administrative and judicial, is to maintain efficiency, smooth and
orderly functioning of the entire machinery of justice in such a
way as it does not bring it into any disrepute. The power of
interference under this Article is to be kept to the minimum to
ensure that the wheel of justice does not come to a halt and the
fountain of justice remains pure and unpolluted in order to
maintain public confidence in the functioning of the tribunals and
Courts subordinate to High Court. This being an exceptional
power of the judicial intervention shall need to be exercised for
promotion of public confidence in the administration of justice in
the larger public interest unlike Article 226 which is meant for
protection of individual grievance. The powers under Article 227
although unfettered shall need to be exercised to a high degree of
discipline pointed out in the said decision of Shalini Shyam
Shetty. For maintaining its strength and vitality, there cannot be
an exercise that can prove to be counter-productive.
15. The Court, therefore, needs to examine as to whether there
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has been a gross and manifest failure of justice due to violation of
basic principles of natural justice or there has been a patent
perversity in the order of Tribunal and the Court subordinate to it
for it to interfere in this supervisory jurisdiction as held in case of
Waryam Singh and another vs Amarnath and another [1954 AIR
215] which has been followed in subsequent decisions.
16. This Court needs to examine the parameters as to whether
the jurisdiction of superintendence is necessary for keeping the
Labour Court and the Tribunal "within the bounds of their
authority". In the opinion of this Court, on examination of the
material on record and from the detailed examination of the
judgements and orders of both the courts below, the case does not
fall within the parameters of the interference by this Court in
exercise of its powers on superintendence as has been reiteratively
and in detail laid down so far as the core issue of dismissal is
concerned. Both the courts committed no error much less any
grave perversity of holding the very action on the part of the
employer illegal and contrary to the settled position of law.
Even without evaluating in detail the evidence, suffice to
note that subsequent to the 1st round of litigation, no
departmental inquiry has been conducted by the employer at all
and earlier when conducted, it has failed to avail the opportunity
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of hearing as was expected and thereby, violated fragrantly the
principles of natural justice.Both the authorities below have
threadbare examined the factual matrix as well as the law on the
subject to correctly and unfailingly conclude that the very action
of initiating the departmental inquiry lacked bonafide and the
entire exercise was an unpalatable design to ensure removal of
undesired employees. No interference is needed so far as these
findings and conclusions on the aspect of dismissal and
departmental proceedings are concerned.
17. If one looks at this stage the T Application No. 18 of 1995, it
was preferred under Sections 78 and 79 of the Bombay Industrial
Relations Act (hereinafter referred to as the 'BIR Act'). The
respondent was working as a supervisor for the past 15 years in
agricultural department as a permanent employee. It is a Sugar
Industry where the provisions of BIR Act are applicable. The
respondent and other employees were members of the union of
workers of Sugar Industry and this is the only union representing
the Sugar Industry Workmen. It had been alleged on the part of
the respondent that as they were needed to frequently attend to
various complaints which used to be received on the part of the
employees / co-workers, they needed to approach the employer
frequently and therefore, keeping a vendetta against them, a
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conspiracy was hedged to ensure that they are removed from the
service by any illegal means. He and others were suspended and
the departmental proceedings were initiated against them. The
charge-sheet had been filed on 14.11.1994 and the inquiry was
initiated on 23.01.1995. The last date when the respondent
remained present in the department inquiry was 07.04.1995,
however, on account of election of the co-operative society,
proceedings had been adjourned. They were ensured to be
intimated of the next adjourned date which had been given to
them after the adjourned date had passed. And thus, the right to
defend in the departmental proceedings had been closed and the
order had been passed against them without, in essence,
conducting any departmental proceedings. The issuance of
second show cause notice and the order of dismissal on
03.05.1995 had aggrieved the respondent. He also had written a
letter dated 10.05.1995 to the department making a request,
however, he was not taken back in the service. On 03.05.1995 he
was dismissed from the job. This, according to the respondent,
was contrary to the standing order passed on the basis of
principles of natural justice and other provisions of law. He
therefore, made a request for reinstatement and the back wages.
17.1. The other side appeared and clarified its stand that on
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12.04.1995, no one remained present from the side of the
employees in the departmental proceeding and therefore, officer
assumed that there was nothing further to be adduced and hence,
on holding that the charges were duly proved as had been laid,
the order of dismissal was passed on 03.05.1995. He was asked
to collect his pay and other monetary benefits, however, the
employee concerned did not attend on 10.05.1995 as had been
asked and hence, he was sent the cheque of his legal dues. The
cheque had not been deposited in the bank and therefore, on
31.05.1995, the amount had been sent to the Gujarat Labour
Welfare Fund. The amount of gratuity, according to the petitioner,
was Rs. 24,106/-.
17.2. The Labour Court examined the entire material and
had found the departmental inquiry to have been vitiated and
therefore, directed the reinstatement of the respondent. It also
further directed that the employee to be kept under suspension
from 12.04.1995 and such departmental proceedings to be
completed in three months' period. It was also directed that the
employer needed to pay Rs. 5000/- towards expenses to the
employee.
17.3. Aggrieved by this order of reinstatement and other
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directions, the petitioner had approached the Industrial Tribunal
by filing Revision (IC) No. 22 of 2005 where the revision also had
been rejected. The order passed on 02.05.2005 of reinstating the
respondent in the service has been upheld and it directed the
petitioner to comply with the same in seven days' time.
Considering the suffering of the respondent, the financial damage,
the delay in completing the proceedings and noticing the
incorrect, improper and inappropriate conduct of the petitioner,
the cost of Rs. 5,000/- had been directed to be paid to the
respondent. It further directed the completion of entire procedure
on the part of the Labour Court in sixty days' time which had been
attempted by the Labour Court. The Court also noted that the
petitioner did not obey the directions of the Labour Court dated
02.05.2005 as well as of Industrial Court dated 09.07.2007 and
there had been no challenge of the order of Industrial Court which
had confirmed the order of the Labour Court.
17.4. The Review (IC) No. 10 of 2007 had been preferred
against the order of Industrial Court where no injunction had been
granted. Later on, the order came to be passed on 03.08.2007 by
the Industrial Court directing the Labour Court, Valsad to
complete the hearing on merits on day-to-day proceedings. The
petitioner disclosed before the Industrial Court, Surat that it had
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preferred Special Civil Application No. 22644 of 2007 before this
Court, although before the Labour Court, no details of this
proceeding had been disclosed. In absence of any order from this
Court, the Labour Court proceeded on the basis of written and
oral evidence which have been adduced before it.
17.5. According to the Labour Court, the petitioner's act was
contrary to law when tested at the touchstone of the parameters
laid down by the Apex Court and this Court and therefore, chose
to direct the reinstatement with 70% back wages on the ground
that there has been a possibility of some work having been done
by the person concerned. The Court also noticed that in the
present time, it is impossible for anyone to survive without
working as the case is of the year 1995 and the decision has been
rendered in the year 2016 and therefore, within 30 days, it
directed the reinstatement with 70% back wages.
17.6. The employer had preferred an Appeal (IC) No. 51 of
2007 which had been heard with the appeal of the employee being
Appeal (IC) No. 62 of 2007 by the Industrial Court, Surat. The
tribunal noted that on 30.11.2008 as the respondent attained the
age of superannuation, there was no question of reinstatement of
his. There was a Revision Application No. 22 of 2005 and Review
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Application No. 10 of 2007. The Labour Court directed the
reinstatement with 70% back wages and the action of the
petitioner dated 03.05.1995 was held illegal. The tribunal has
noted the fact that the second show cause notice was not given
after concluding the inquiry inappropriately and this was held to
be without availing the opportunity to the employees. There was
already an opportunity given to the petitioner - employer to prove
the charges. It relied on Section 78(1)(A)(1) to hold that the legality
and validity of the action of employer can be always scrutinized by
the Labour Court and it can decide the same accordingly. The
Court also lamented the fact that from the year 1995, 22 years
had passed. The employer also ensured that the employee reaches
the age of superannuation. The amount of gratuity had also
returned to the institute. The petitioner did not reveal as to what
was the monthly pay nor has it paid the amount of cost which has
been directed at the time of passing of interim relief and therefore,
the orders of revision and review were passed. It, therefore,
directed the amount of gratuity being Rs. 24,106/- with 9%
interest thereon which is Rs. 6047.20/-. It did not accede to the
request of 100% back wages.
17.7. The orders passed in both the cross-appeals are not
suffering from any kind of error much less any illegality nor are
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the orders suffering from any perversity which requires
interference of this Court. It has taken very consistent stand of
the employer petitioner who has chosen not to obey the directions
of the interim order of reinstating the employee and thereafter
concluded the inquiry. It rather chose to go on challenging and
questioning every order which has been passed in favour of the
employee and against itself. It is unfortunate event which took
place and also has been, in detail, narrated by the Tribunal.
18. It is true that ordinarily the parties who approach the Courts
shall need to prove its case, as the burden would lie on the person
who approaches the Court, however, in the matters before the
Labour Court, strict law of evidence is not to be applied. The
respondent - employee succeeded in bringing on record the
closure of inquiry without following the due procedure of law. The
absence of the employee for one day and that too, on a valid
ground of election of co-operative society was usurped by the
employer to somehow drive away the unwarranted employee, who
according to the management, was interfering in their
administration and frequently attempting to seek redressal of the
grievance of many others being the union leader.
19. Assuming that the inquiry conducted till 31.03.1995 was
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legal and proper, it was sufficient on the part of the employee to
show that inquiry has been abruptly concluded. The authority
since asserted that the departmental proceedings had been rightly
and legally conducted, naturally the burden would lie upon the
authority concerned to then prove this aspect on the basis of the
material that it had. Both the authorities had an occasion to
examine the material at length and conclude with cogent and
convincing reasons. Unfailingly, both the Labour Court and
Tribunal correctly held that the employer - petitioner had
committed illegality in conducting the inquiry which should be
termed as vitiated. It also failed to show the reason for such
unpalatable rush.
20. Therefore, the say of the petitioner, that the workman had
not entered the witness-box nor led any evidence to narrate as to
what he had been deprived of during the inquiry, is not at all
necessary. It was the management which had laid the charges
against the employee, which was required to prove them by
ensuring that all tenets of conducting departmental proceedings
democratically and in accordance with law are followed
scrupulously. It is not a correct stand on the part of the petitioner
and on the contrary, a dishonest design that the order directing
reinstatement was the subject matter of other litigations in the
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form of revision before the Industrial Court, subsequent review
and thereafter, in the form of Special Civil Application before this
Court and by then, since the main matter before the Labour Court
had attained finality, the Special Civil Application was withdrawn
on the ground that a separate and independent challenge would
lie against the grievance.
20.1. In absence of any stay granted by the higher forum either
in the revision or in the review and thereafter, by this Court in
SCA, the employer could not have assumed the role of appellate
forum by becoming a self-styled judge and not obey the decision
of different authorities. If permitted, there cannot be any sanctity
of the interim orders which had been passed at different stages.
There appears to be total impudence on the part of the petitioner
- employer in not only not obeying the interim order which has
been passed, but also thereafter, urging that such directions had
merged into the final order. It cannot be oblivious of the fact that
the final judgment also came in the favour of the respondent -
employee. The purpose and object on the part of the Courts was
to ensure that, in the interregnum, the employees who are the
workers do not suffer and that direction was disobeyed all
throughout by ensuring that the employees attain to the age of
superannuation. The employer since has financial capacity to
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litigate tirelessly, to tire the workers who hail from the modest
socio-economic strata where feeding their dependents at the end
of the day also is a concern, is not difficult at all. In this fight of
two unequals, sufferers unquestionably is only the labour class
and the employees successfully defeated the reaping of fruits by
the employees.
21. In relation to the grant of back wages as well as other
benefits, for the reasons to follow, there would need some
indulgence tilting in favour of the employees from the robust
materials which has emerged on record.
Undoubtedly, as rightly pointed out by the petitioner by
relying on the decision of Food Corporation of India (Supra), there
should be an evidence to prove the facts as per the provisions of
the Evidence Act. There the workmen, 464 in numbers, of Siliguri
depot of FCI eventually were directed to be reinstated with
identification and they were employed by the contractor and
directly paid by the FCI and those reinstated after proper
identification were given 70% back wages. The Apex court also
expressed its dissatisfaction over the expected "fair and impartial"
dealing on the part of the FCI, an instrumentality of the State who
unnecessarily had delayed the final proceedings. This decision, in
fact, would aid the respondents herein. In the matter on hand, it
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is not a question of identification of employee nor a question
whether the employer was willing to allow the work and the
employees chose not to work.The employees being the permanent
employees were even otherwise entitled to their rightful
employment.
21.1. The petitioner is also right in pointing out from the
decision of Prem Chandra Agarwal (Supra) that once the final
order is passed, all the earlier interim orders would merge into the
final order and the interim orders would cease to exist. At the
same time, the Court cannot also be oblivious of the fact that the
interim orders passed by the Court or the Tribunal shall need to
be followed by the parties against whom they have been passed.
21.2. In the instant case, this Court also cannot fail to notice
the fact that there had been a challenge by the employees to the
non-action on the part of the employer in reinstating the
employees by way of interim order and this Court also had
affirmed the stand of the employees, therefore, even if, eventually
it is the final judgment and award which shall prevail and the
interim relief would merge into the final relief, all these aspects
cannot be simply overlooked by the Court at the time of
considering the issue of back wages.
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22. So far as back wages to the tune of 70% is concerned, the
Labour Court was right in pointing out that it is quite unlikely
that the employees, for such a long time, would remain without
any work and hence, instead of granting 100% back wages, it has
deducted 30% and granted 70% of the total amount of wages. The
Court noticed that there is no basic evidence on the part of the
employee of its not having worked for all these years or not having
earned any amount in the interregnum. The Court, therefore,
awarded 70% wages from the date of dismissal. However, what
has been missed out by the courts is the period from the time, the
court directed the reinstatement In the service i.e. from 2nd
May,2005 which was not obeyed nor stayed by the higher forum,
and hence, there shall need to be grant and award of 100% back
wages from 02/05/2005 till the date of payment as otherwise, it
would amount to emboldening those parties who are financially
sound, economically better of and enjoy comparatively a dominant
position in their professional relationship and deliberately chooses
to evade its legal obligations anyhow for a protracted period.
22.1. It would be relevant and profitable to refer to the decision
of the Apex Court in case of J.K.Synthetics Ltd. Vs. K.P.Agrawal
& Anr. [Appeal (civil) 7657 of 2004 on dated 01.02.2007] where
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back wages follow the decision of reinstatement.
"11. Learned counsel for the employee relied on several
decisions of this Court to contend that where the order
of dismissal or removal is set aside and the employee is
directed to be reinstated, full back-wages should follow
as a matter of course. Reliance is placed on the deci-
sions of this Court in Hindustan Tin Works Pvt. Ltd., vs.
Employees of Hindustan Tin Works Pvt. Ltd. [1979 (2)
SCC 80], Surendra Kumar Verma vs. Central Govern-
ment Industrial Tribunal-cum-Labour Court, New Delhi
[1981 (1) SCR 789], and Mohan Lal vs. Bharat Electron-
ics Ltd., [1981 (3) SCC 225].
12. Hindustan Tin Works Pvt. Ltd (supra), related to re-
trenchment of some workmen on the ground that the em-
ployer was suffering mounting losses. The labour court
held that the real reason for retrenchment was the an-
noyance felt by the management when the employees
refused to agree to its terms. Consequently, it directed
the reinstatement with full back wages. That was chal-
lenged by the employer. This Court granted leave to ap-
peal, only in regard to the question of back-wages, as it
did not consider it necessary to interfere with the direc-
tion for reinstatement. Ultimately, while reducing the
back-wages to 75%, this Court observed as follows :
"If thus the employer is found to be in the wrong as a
result of which the workman is directed to be reinstated,
the employer could not shirk his responsibility of paying
the wages which the workman has been deprived of by
the illegal or invalid action of the employer. Speaking
realistically, where termination of service is questioned
as invalid or illegal and the workman has to go through
the gamut of litigation, his capacity to sustain himself
throughout the protracted litigation is itself such an
awesome factor that he may not survive to see the day
when relief is granted. More so in our system where the
law's proverbial delay has become stupefying. If after
such a protracted time and energy consuming litigation
during which period the workman just sustains himself,
ultimately he is to be told that though he will be rein-
stated, he will be denied the back wages which would
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be due to him, the workman would be subjected to a sort
of penalty for no fault of his and it is wholly undeserved.
Ordinarily, therefore, a workman whose service has
been illegally terminated would be entitled to full back
wages except to the extent he was gainfully employed
during the enforced idleness. That is the normal rule.
Any other view would be a premium on the unwar-
ranted litigative activity of the employer. If the employer
terminates the service illegally and the termination is
motivated as in this case, viz., to resist the workman's
demand for revision of wages the termination may well
amount to unfair labour practice. In such circumstances
reinstatement being the normal rule, it should be fol-
lowed with full back wages.
In the very nature of things there cannot be a straight
jacket formula for awarding relief of back wages. All rel-
evant 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 circum-
stances necessitating departure. At that stage the Tri-
bunal will exercise its discretion keeping in view all the
relevant circumstances. But the discretion must be exer-
cised 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 hu-
mour."
[emphasis supplied]
13. Surendra Kumar Verma (supra) related to retrench-
ment of several workmen in violation of section 25-F of
the Industrial Disputes Act, 1947 ('ID Act' for short). This
Court held that when the order of termination is set
aside as being invalid and inoperative, it must ordinar-
ily lead to reinstatement as if the order of termination
was never made and that would necessarily lead to
back-wages too. This Court, however, observed that
there may be exceptional circumstances which may
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make it impossible or wholly inequitable vis-`-vis em-
ployer and workmen to direct reinstatement with full
back-wages as for example, when the industry might
have closed down or might be in severe financial dol-
drums or where the concerned employee might have se-
cured other employment elsewhere and in such situa-
tions, the court has the discretion to deny full back-
wages. In the concurring judgment Pathak J. (as he then
was), held as follows :
"Ordinarily, a workman who has been retrenched in
contravention of the law is entitled to reinstatement with
full back wages and that principle yields only where the
justice of the case in the light of the particular facts in-
dicates the desirability of a different relief. It has not
been shown to us on behalf of the respondent why the
ordinary rule should not be applied."
14. Mohan Lal (supra) also related to retrenchment not
in consonance with section 25-F of ID Act. This Court
held :
"As pre-condition for a valid retrenchment has not been
satisfied the termination of service is ab initio void, in-
valid and inoperative. He must, therefore, be deemed to
be in continuous service.. If the termination of service is
ab initio void and inoperative, there is no question of
granting reinstatement because there is no cessation of
service and a mere declaration follows that he continues
to be in service with all consequential benefits. Undoubt-
edly, in some decisions of this Court such as Ruby
General Insurance Co. Ltd., vs. Chopra (P.P) [1969 (3)
SCC 653] and Hindustan Steels Ltd., vs. A. K.
Roy [1969 (3) SCC 513], it was held that the court be-
fore granting reinstatement must weigh all the facts and
exercise discretion properly whether to grant reinstate-
ment or to award compensation. But there is a catena
of decisions which rule that where the termination is il-
legal especially where there is an ineffective order of re-
trenchment, there is neither termination nor cessation of
service and a declaration follows that the workman con-
cerned continues to be in service with all consequential
benefits. No case is made out for departure from this
normally accepted approach of the courts in the field of
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social justice and we do not propose to depart in this
case."
15. But the manner in which 'back-wages' is viewed,
has undergone a significant change in the last two dec-
ades. They are no longer considered to be an automatic
or natural consequence of reinstatement. We may refer
to the latest of a series of decisions on this question. In
U.P. State Brassware Corpn. Ltd. vs Udai Narain Pan-
dey [2006 (1) SCC 479], this Court following Allahabad
Jal Sansthan vs. Daya Shankar Rai [2005 (5) SCC
124], and Kendriya Vidyalaya Sangathan vs. S. C.
Sharma [2005 (2) SCC 363] held as follows :
"A person is not entitled to get something only because
it would be lawful to do so. If that principle is applied,
the functions of an Industrial Court shall lose much of
their significance."
"although direction to pay full back wages on a declara-
tion that the order of termination was invalid used to be
the usual result, but now, with the passage of time, a
pragmatic view of the matter is being taken by the
courts realizing that an industry may not be compelled
to pay to the workman for the period during which he
apparently contributed little or nothing at all to it and/or
for a period that was spent unproductively as a result
whereof the employer would be compelled to go back to
a situation which prevailed many years ago, namely,
when the workman was retrenched... The changes
(were) brought about by the subsequent decisions of the
Supreme Court, probably having regard to the changes
in the policy decisions of the Government in the wake of
prevailing market economy, globalization, privatization
and outsourcing, is evident.
No precise formula can be laid down as to under what
circumstances payment of entire back wages should be
allowed. Indisputably, it depends upon the facts and
circumstances of each case. It would, however, not be
correct to contend that it is automatic. It should not be
granted mechanically only because on technical
grounds or otherwise an order of termination is found to
be in contravention of the provisions of section 6- N of
the U.P. Industrial Disputes Act.. While granting relief,
C/SCA/20076/2017 JUDGMENT
application of mind on the part of the Industrial Court is
imperative. Payment of full back wages cannot therefore
be the natural consequence.
In General Manager, Haryana Roadways vs. Rudhan
Singh [2005 (5) SCC 591], this Court observed :
"There is no rule of thumb that in every case where the
Industrial Tribuanl gives a finding that the termination
of service was in violation of Section 25-F of the Act,
entire back wages should be awarded. A host of factors
like the manner and method of selection and appoint-
ment i.e. whether after proper advertisement of the va-
cancy or inviting applications from the employment ex-
change, nature of appointment, namely, whether ad
hoc, short term, daily wage, temporary or permanent in
character, any special qualification required for the job
and the like should be weighed and balanced in taking
a decision regarding award of back wages. One of the
important factors, which has to be taken into consider-
ation, is the length of service, which the workman had
rendered with the employer. If the workman has ren-
dered a considerable period of service and his services
are wrongfully terminated, he may be awarded full or
partial back wages keeping in view the fact that at his
age and the qualification possessed by him he may not
be in a position to get another employment. However,
where the total length of service rendered by a workman
is very small, the award of back wages for the complete
period i.e. from the date of termination till the date of the
award, which our experience shows is often quite large,
would be wholly inappropriate. Another important fac-
tor, which requires to be taken into consideration is the
nature of employment. A regular service of permanent
character cannot be compared to short or intermittent
daily-wage employment though it may be for 240 days
in a calendar year."
16. There has also been a noticeable shift in placing the
burden of proof in regard to back wages. In Kendriya
Vidyalaya Sangathan (supra), this Court held :
"..When the question of determining the entitlement of a
person to back wages is concerned, the employee has
to show that he was not gainfully employed. The initial
C/SCA/20076/2017 JUDGMENT
burden is on him. After and if he places materials in that
regard, the employer can bring on record materials to
rebut the claim. In the instant case, the respondent had
neither pleaded nor placed any material in that regard."
In U.P. State Brassware Corpn. Ltd. (supra), this Court
observed :
"It is not in dispute that the respondent did not raise any
plea in his written statement that he was not gainfully
employed during the said period. It is now well settled
by various decisions of this Court that although earlier
this Court insisted that it was for the employer to raise
the aforementioned plea but having regard to the provi-
sions of section 106 of the Evidence Act or the provi-
sions analogous thereto, such a plea should be raised
by the workman."
17. There is also a misconception that whenever rein-
statement is directed, 'continuity of service' and 'conse-
quential benefits' should follow, as a matter of course.
The disastrous effect of granting several promotions as
a 'consequential benefit' to a person who has not
worked for 10 to 15 years and who does not have the
benefit of necessary experience for discharging the
higher duties and functions of promotional posts, is sel-
dom visualized while granting consequential benefits
automatically. Whenever courts or Tribunals direct rein-
statement, they should apply their judicial mind to the
facts and circumstances to decide whether 'continuity of
service' and/or 'consequential benefits' should also be
directed. We may in this behalf refer to the decisions of
this Court in A.P.S.R.T.C. v. S. Narasa Goud [2003 (2)
SCC 212], A.P.S.R.T.C. v. Abdul Kareem [2005 (6)
SCC 36] and R.S.R.T.C. v. Shyam Bihari Lal
Gupta [2005 (7) SCC 406].
18. Coming back to back-wages, even if the court finds
it necessary to award back-wages, the question will be
whether back-wages should be awarded fully or only
partially (and if so the percentage). That depends upon
the facts and circumstances of each case. Any income
received by the employee during the relevant period on
account of alternative employment or business is a rele-
vant factor to be taken note of while awarding back-
C/SCA/20076/2017 JUDGMENT
wages, in addition to the several factors mentioned in
Rudhan Singh (supra) and Udai Narain Pandey (supra).
Therefore, it is necessary for the employee to plead that
he was not gainfully employed from the date of his ter-
mination. While an employee cannot be asked to prove
the negative, he has to at least assert on oath that he
was neither employed nor engaged in any gainful busi-
ness or venture and that he did not have any income.
Then the burden will shift to the employer. But there is,
however, no obligation on the terminated employee to
search for or secure alternative employment. Be that as
it may.
19. But the cases referred to above, where back-wages
were awarded, related to termination/retrenchment
which were held to be illegal and invalid for non-compli-
ance with statutory requirements or related to cases
where the court found that the termination was moti-
vated or amounted to victimization. The decisions relat-
ing to back wages payable on illegal retrenchment or
termination may have no application to the case like the
present one, where the termination (dismissal or re-
moval or compulsory retirement) is by way of punish-
ment for misconduct in a departmental inquiry, and the
court confirms the finding regarding misconduct, but
only interferes with the punishment being of the view
that it is excessive, and awards a lesser punishment,
resulting in the reinstatement of employee. Where the
power under Article 226 or section 11A of the Indus-
trial Disputes Act (or any other similar provision) is ex-
ercised by any Court to interfere with the punishment
on the ground that it is excessive and the employee de-
serves a lesser punishment, and a consequential direc-
tion is issued for reinstatement, the court is not holding
that the employer was in the wrong or that the dismissal
was illegal and invalid. The court is merely exercising
its discretion to award a lesser punishment. Till such
power is exercised, the dismissal is valid and in force.
When the punishment is reduced by a court as being
excessive, there can be either a direction for reinstate-
ment or a direction for a nominal lump sum compensa-
tion. And if reinstatement is directed, it can be effective
either prospectively from the date of such substitution of
C/SCA/20076/2017 JUDGMENT
punishment (in which event, there is no continuity of ser-
vice) or retrospectively, from the date on which the pen-
alty of termination was imposed (in which event, there
can be a consequential direction relating to continuity of
service). What requires to be noted in cases where find-
ing of misconduct is affirmed and only the punishment
is interfered with (as contrasted from cases where ter-
mination is held to be illegal or void) is that there is no
automatic reinstatement; and if reinstatement is di-
rected, it is not automatically with retrospective effect
from the date of termination. Therefore, where reinstate-
ment is a consequence of imposition of a lesser punish-
ment, neither back-wages nor continuity of service nor
consequential benefits, follow as a natural or necessary
consequence of such reinstatement. In cases where the
misconduct is held to be proved, and reinstatement is
itself a consequential benefit arising from imposition of
a lesser punishment, award of back wages for the pe-
riod when the employee has not worked, may amount
to rewarding the delinquent employee and punishing
the employer for taking action for the misconduct com-
mitted by the employee. That should be avoided. Simi-
larly, in such cases, even where continuity of service is
directed, it should only be for purposes of pension-
ary/retirement benefits, and not for other benefits like
increments, promotions etc.
20. But there are two exceptions. The first is where the
court sets aside the termination as a consequence of em-
ployee being exonerated or being found not guilty of the
misconduct. Second is where the court reaches a con-
clusion that the inquiry was held in respect of a frivolous
issue or petty misconduct, as a camouflage to get rid of
the employee or victimize him, and the disproportion-
ately excessive punishment is a result of such scheme
or intention. In such cases, the principles relating to
back-wages etc. will be the same as those applied in the
cases of an illegal termination.
21. In this case, the Labour Court found that a charge
against the employee in respect of a serious misconduct
was proved. It, however, felt that the punishment of dis-
missal was not warranted and therefore, imposed a
C/SCA/20076/2017 JUDGMENT
lesser punishment of withholding the two annual incre-
ments. In such circumstances, award of back wages
was neither automatic nor consequential. In fact, back
wages was not warranted at all."
23. So far as the decision of P. Karuvapaiah vs. The general
manager, Thiruvalluvar Transport Corporation (supra) is
concerned the Apex court was dealing with the appeal of employee
filed against the judgement and order of the High Court where the
High Court dismissed the appeal and the Appellant was denied
the back wages for a period of about five years. Apex court held
that the question of award of back wages has taken some shift
where the employee does not become entitled to claim back wages
as of right unless the order of reinstatement itself in express terms
directs payment of the same and other benefits Quoting the
decision of MP State Electricity Board versus Zarina Bee
reported in (2003) 6 SCC 141. The court also has held that the
employee to claim relief of back wages along with relief of
reinstatement is required to prove with the aid of evidence that it
was not gainfully employed anywhere and the employer also has
a right to show otherwise that an employee concerned was
gainfully employed during the relevant period. In absence of any
evidence brought on record by the employee to claim the back
wages for the period in question, the Apex Court denied to
entertain the relief.
C/SCA/20076/2017 JUDGMENT
23.1. Thus, in absence of any thumb rule to award 100%
back wages or all consequential benefits the moment the Labour
Court or the Industrial Court reinstate the person or declare the
action illegal of the employer, request on the part of the
Respondents of grant of 100% back wages may not be necessary
to be granted, however, some interference shall be needed as
ordinarily the party desiring departure would need to establish as
to why consequential reliefs be denied, once its action is declared
illegal and untenable. This court cannot be unmindful of the
conduct of the employer which is quite glaring and which chose
not to conduct the departmental inquiry nor reinstated any of the
employees, not even those two respondents in whose case even
subsequent inquiry had not been permitted. Petitioner employer
willfully allowed entire time period of their employment to lapse
despite its having lost at different stages before all the forums.
This conduct when looked at along with the detailed discussion
on the part of both the authorities below, no interference would
be necessary, except as mentioned hereinabove of grant of 100%
back wages from the date of first order of reinstatement in the year
2005 by the Labour Court.
23.2 So far as the amount of gratuity and other benefits are
C/SCA/20076/2017 JUDGMENT
concerned, the Court below has calculated the amount employees
wise. Therefore, for now, there is no requirement for this Court to
enter into the said aspects of gratuity which had been already
deposited with Gujrat welfare Labour commissioner. Over and
above the amount of gratuity, other retiral benefits be worked out
till their date of superannuation. If, it is more than what has been
specified by the Labour court, the same shall be paid to each one
of them. on the aspect of interest on the amount of gratuity, rate
of interest of 9% is not to be interfered. Back wages shall be 100%
from 2nd May, 2005 as discussed hereinabove with 9% interest in
case of each employee except two of the respondents namely, Shri
Kantilal Rana and Shri Subhash Panjwani (Petitioners of SCA
6576/18 and SCA 6557/2018 respectively) in whose cases, the
courts had not even permitted further proceedings and therefore,
their very dismissal from the beginning when has been found
unsustainable, they need to be given 100% back wages and other
consequential benefits.
24. It is unfortunate that some of them have already passed
away and have not survived to see the fruits of their own toils. Let
the monetary benefits be made available to the employees within
twelve weeks from the date of receipt of copy of this order.
C/SCA/20076/2017 JUDGMENT
25. Noticing throughout the conduct on the part of the
employer, this Court is of the opinion that in all the matters where
the employer has challenged the judgment and award, the cost is
to be imposed to the tune of Rs. 20,000/- (Rupees Twenty
Thousand Only).
26. All the appeals preferred by the employers are dismissed and
those preferred by the employees are allowed partly in the above
terms.
(SONIA GOKANI, J)
MAYA S. CHAUHAN/Bhoomi
FURTHER ORDER:
At this stage, learned Senior Counsel Shri Gautam Joshi
with learned advocate Mr. Abhilash Clerk have made a request to
stay the judgment and operation of the operative order. As this
Court has directed the monetary benefit to be made available to
the employees within 12 weeks from the date of receipt of copy of
this judgment and order, this request is not being acceded to as
in any case, the employer is already having the time of 12 week to
fulfill its obligations.
(SONIA GOKANI, J)
MAYA S. CHAUHAN/Bhoomi
