Gujarat High Court

Jetpur Navagadh Municipality vs Pathan Yunuskhan Jamyalkhan on 18 April, 2024

Author: Biren Vaishnav

Bench: Biren Vaishnav

                                                                         NEUTRAL CITATION




C/LPA/1091/2023                           ORDER DATED: 18/04/2024

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       IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

          R/LETTERS PATENT APPEAL NO. 1091 of 2023
                             In
        R/SPECIAL CIVIL APPLICATION NO. 17944 of 2021
                            With
           R/LETTERS PATENT APPEAL NO. 700 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 18321 of 2021
                            With
          R/LETTERS PATENT APPEAL NO. 1182 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 17944 of 2021
                            With
         CIVIL APPLICATION (FOR STAY) NO. 1 of 2023
                              In
          R/LETTERS PATENT APPEAL NO. 1182 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 17944 of 2021
                            With
          R/LETTERS PATENT APPEAL NO. 1092 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 18321 of 2021
                            With
         CIVIL APPLICATION (FOR STAY) NO. 1 of 2023
                              In
          R/LETTERS PATENT APPEAL NO. 1092 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 18321 of 2021
                            With
          R/LETTERS PATENT APPEAL NO. 1093 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 18334 of 2021
                            With
         CIVIL APPLICATION (FOR STAY) NO. 1 of 2023
                              In
          R/LETTERS PATENT APPEAL NO. 1093 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 18334 of 2021
                            With
          R/LETTERS PATENT APPEAL NO. 1094 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 17941 of 2021
                            With
         CIVIL APPLICATION (FOR STAY) NO. 1 of 2023
                              In
          R/LETTERS PATENT APPEAL NO. 1094 of 2023
                              In
        R/SPECIAL CIVIL APPLICATION NO. 17941 of 2021
                            With
          R/LETTERS PATENT APPEAL NO. 1095 of 2023


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                                                                            NEUTRAL CITATION




     C/LPA/1091/2023                        ORDER DATED: 18/04/2024

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                                      In
            R/SPECIAL CIVIL APPLICATION NO. 1794 of 2022
                                   With
             CIVIL APPLICATION (FOR STAY) NO. 1 of 2023
                                     In
              R/LETTERS PATENT APPEAL NO. 1095 of 2023
                                      In
            R/SPECIAL CIVIL APPLICATION NO. 1794 of 2022
                                   With
               R/LETTERS PATENT APPEAL NO. 701 of 2023
                                      In
            R/SPECIAL CIVIL APPLICATION NO. 18334 of 2021
==================================================

JETPUR NAVAGADH MUNICIPALITY Versus PATHAN YUNUSKHAN JAMYALKHAN ================================================== Appearance:

MR BHAVESH P TRIVEDI(2731) for the Appellant(s) No. 1

MR DHRUV K DAVE(6928) for the Respondent(s) No. 1 ==================================================

CORAM:HONOURABLE MR. JUSTICE BIREN VAISHNAV and HONOURABLE MR. JUSTICE PRANAV TRIVEDI

Date : 18/04/2024

ORAL COMMON ORDER

(PER : HONOURABLE MR. JUSTICE PRANAV TRIVEDI)

1. The present Letters Patent Appeals under Clause 15 of the

Letters Patent are directed against the judgment and order of the

learned Single Judge passed in two group of matters dated

02.03.2023 and 03.03.2023 respectively. Since the issue involved

is common, we are taking all the Letters Patent Appeals together

for adjudication. By the said judgment and order, the learned

Single Judge held that the Municipality shall pay lump sum

compensation to the respondent - workmen modifying the

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judgment and award of the labour court accordingly. Being

aggrieved by the said order, the Municipality has preferred Letters

Patent Appeals challenging the quantum of compensation. The

cross-appeals are preferred by the workmen for quashment of the

order of the learned Single Judge granting compensation and,

therefore, prayed for reinstatement along with backwages. Thus,

we have taken cross appeals together for adjudication.

2. The facts in the background inter alia are that the workmen

had invoked jurisdiction of labour court, Rajkot by way of

preferring Reference. The judgment and award was delivered by

the labour court holding that the action of the termination of the

workmen by the employer was illegal. The workmen were directed

to be reinstated with continuity of service on original posts with

20% backwages.

3. The labour court on the basis of evidence led before it

recorded a finding that there was a breach of Sections 25F, 25G

and 25H of the Industrial Disputes Act, 1947 in terminating the

services of the workmen.

3.1. It appears that it was the municipality who had filed Special

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Civil Application challenging the judgment and award passed by

the labour court, which culminated into order of the learned

Single Judge whereby the learned Single Judge found it fit to

modify the lump sum compensation in-lieu of reinstatement qua all

the workmen. Thus, it has resulted into cross appeals being filed

by the Municipality as well as the workmen. It would be pertinent

to mention that out of the common order passed by the learned

Single Judge, one of the petitioners had already preferred Letters

Patent Appeal being Letters Patent Appeal No. 1090 of 2023 in

Special Civil Application No. 18336 of 2021. This Court had

dismissed the appeal preferred by the Municipality and confirmed

the order passed by the learned Single Judge. The relevant part of

the order passed by the Division Bench is reproduced hereunder :

"4. Although learned advocate for the appellant wanted to submit that learned single Judge has not given any reasons in modifying the award by granting lump-sum compensation and that the lump-sum compensation is on higher side since the workman was daily rated workman and was getting only Rs.286/- per day as wages, this court has considered the controversy applying the above aspects.

5. It is not in dispute that the workman was appointed in the year 1998, she served as Labourer in the PWD Department of the Municipality throughout. Her termination was on 1.8.2015. In other words, she worked long 15 years with the Municipality. 5.1 Looking to the time gap which has intervened between the date of termination and the date of granting relief of reinstatement, when learned single Judge has thought it fit to award lump-sum compensation, the approach on part of learned single Judge could not be faulted.

5.2 Looking to the various aspects and factors considered above,

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including the length of service, nature of employment, the time gap intervening, etc., in overall view, the compensation awarded to the tune of Rs.4,25,000/- could not be said to unreasonable."

3.2. Thus, the co-ordinate Bench of this Court on the common

issue raised has come to the conclusion that order granting lump

sum compensation was just and proper.

4. Over a passage of time, the law has developed to lay down

the proposition that even in case where the labour court or

Industrial Tribunal comes to a conclusion that there was a breach

of provisions of Section 25F of the Industrial Disputes Act, it

cannot necessarily or automatically entail the relief of

reinstatement for the workmen.

4.1. The shift in law on this count was highlighted by the

Supreme Court in Bhopal Vs. Santosh Kumar Seal [(2010) 6

SCC 773] relying on its own another decision in Jagbir Singh

Vs. Haryana State Agriculture Marketing Board [(2009) 15

SCC 327], observing that the relief of payment of lump-sum

compensation could be a proper relief in a given set of facts and

circumstances.

"In the last few years it has been consistently held by this Court that relief by way of reinstatement with back wages is not automatic

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even if termination of an employee is found to be illegal or is in contravention of the prescribed procedure and that monetary compensation in lieu of reinstatement and back wages in cases of such nature may be appropriate. (See U.P. State Brassware Corpn. Ltd. v. Uday Narain Pandey [2006 (1) SCC 479], Uttaranchal Forest Development Corpn. v. M.C. Joshi [2007 (9) SCC 353], State of M.P. v. Lalit Kumar Verma [2007 (1) SCC 575], M.P. Admn. v. Tribhuban [2007 (9) SCC 748], Sita Ram v. Moti Lal Nehru Farmers Training Institute [2008 (5) SCC 75], Jaipur Development Authority v. Ramsahai [2006 (11) SCC 684], GDA v. Ashok Kumar [2008 (4) SCC 261] and Mahboob Deepak v. Nagar Panchayat, Gajraula [2008 (1) SCC 575].)"

4.2. In subsequent decision in Rajasthan Development

Corporation Vs.Gitam Singh [(2013) 5 SCC 136], the

Supreme Court stated,

"From the long line of cases indicated above, it can be said without any fear of contradiction that this Court has not held as an absolute proposition that in cases of wrongful dismissal, the dismissed employee is entitled to reinstatement in all situations. It has always been the view of this Court that there could be circumstance(s) in a case which may make it inexpedient to order reinstatement. Therefore, the normal rule that the dismissed employee is entitled to reinstatement in cases of wrongful dismissal has been held to be not without exception. Insofar as wrongful termination of daily-rated workers is concerned, this Court has laid down that consequential relief would depend on host of factors, namely, manner and method of appointment, nature of employment and length of service. Where the length of engagement as daily wager has not been long, award of reinstatement should not follow and rather compensation should be directed to be paid. A distinction has been drawn between a daily wager and an employee holding the regular post for the purposes of consequential relief."

4.3. In Uttaranchal Forest Development Corporation Vs.

M.C.Joshi [(2007) 9 SCC 353], the Supreme Court held that the

question of grant of compensation in place of relief of

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reinstatement could be guided by relevant factors to be that

whether the appointment was made in accordance with the

statutory Rules or not.

4.4. It is to be observed that the decisions of the Supreme Court

have carved out the circumstances and aspects which may guide

the discretion of the court in awarding lump-sum compensation

instead of granting relief of reinstatement even if there is a breach

of Section 25F, 25G and 25H of the Industrial Disputes Act.

4.5. These factors were highlighted in Bantva Municipality Vs.

Amritlal Harji Chauhan being Special Civil Application No.9135

of 2013 decided on 31.3.2014 as under :

"(i) The fact that the workman is daily-rated workmen, not permanently employed; (ii) He is not holding a permanent post; (iii) Nature of his employment; (iv) Span of service, viz. The period during which he worked upto the date of termination of services; (v) Manner and method of appointment. Whether it was a backdoor entry; (vi) The time gap from the date of termination; (vii) Delay in raising the Reference is also considered to be a germane factor;

(viii) Any special feature peculiar to the facts of the particular case.

For instance, in Bhurumal (supra), the Supreme Court noticed that post which the workman held was of Lineman in the Telephone Department, and that the work of Lineman was drastically reduced in view of advancement of the technology."

4.6. In the case of BSNL v. Bhurumal, reported in (2014) 7

SCC 177, it was categorically observed that even after

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reinstatement, it is always open to the management to terminate

the services of that employee by paying him the retrenchment

compensation. Even as a daily-wage worker, no useful purpose is

going to be served in reinstating such a workman and he can be

given monetary compensation by the Court itself.

4.7. It is apt and appropriate to reproduce the relevant

observation made by the Hon'ble Apex Court in the case of BSNL

(supra), which reads as under :

"33. It is clear from the reading of the aforesaid judgments that the ordinary principle of grant of reinstatement with full back wages, when the termination is found to be illegal is not applied mechanically in all cases. While that may be a position where services of a regular/permanent workman are terminated illegally and/or mala fide and/or by way of victimisation, unfair labour practice, etc. However, when it comes to the case of termination of a daily-wage worker and where the termination is found illegal because of a procedural defect, namely, in violation of Section 25-F of the Industrial Disputes Act, this Court is consistent in taking the view that in such cases reinstatement with back wages is not automatic and instead the workman should be given monetary compensation which will meet the ends of justice. 4 Rationale for shifting in this direction is obvious.

34. The reasons for denying the relief of reinstatement in such cases are obvious. It is trite law that when the termination is found to be illegal because of non-payment of retrenchment compensation and notice pay as mandatorily required under Section 25-F of the Industrial Disputes Act, even after reinstatement, it is always open to the management to terminate the services of that employee by paying him the retrenchment compensation. Since such a workman was working on daily-wage basis and even after he is reinstated, he has no right to seek regularisation [see State

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of Karnataka v. Umadevi (3) [State of Karnataka v. Umadevi (3), (2006) 4 SCC 1 : 2006 SCC (L&S) 753] ]. Thus when he cannot claim regularisation and he has no right to continue even as a daily-wage worker, no useful purpose is going to be served in reinstating such a workman and he can be given monetary compensation by the Court itself inasmuch as if he is terminated again after reinstatement, he would receive monetary compensation only in the form of retrenchment compensation and notice pay. In such a situation, giving the relief of reinstatement, that too after a long gap, would not serve any purpose.

5. Therefore, looking to the gap which intervened between the

date of termination and the date of granting reinstatement, the

approach of the learned Single Judge granting lump sum

compensation cannot be faulted with.

6. Looking to the various aspects and factors which are

considered above, like the nature of employment, time gap

intervened, length of service, the compensation awarded to the

tune could not be said to be unreasonable. Therefore, Letters

Patent Appeals preferred by the Municipality on the question of

amount of compensation as well as appeals preferred by the

workmen seeking reinstatement are liable to be dismissed.

However, in one of the matters being Letters Patent Appeal No.