Gujarat High Court
Gujarat Agro Industries Corporation ... vs Makwana Natubhai Bhailalbhai on 3 July, 2025
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 8619 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MRS. JUSTICE M. K. THAKKER
==========================================================
Approved for Reporting Yes No
==========================================================
GUJARAT AGRO INDUSTRIES CORPORATION LTD & ANR.
Versus
MAKWANA NATUBHAI BHAILALBHAI
==========================================================
Appearance:
MR NIRAV C THAKKAR(2206) for the Petitioner(s) No. 1,2
==========================================================
CORAM:HONOURABLE MRS. JUSTICE M. K. THAKKER
Date : 03/07/2025
ORAL JUDGMENT
1. This petition is filed under Article 226 and 227 of the
Constitution of India challenging the order passed by the
learned labour court whereby, learned labour court has
allowed the recovery application filed under section
33(C)(2) by the respondent whereby, the petitioner was
directed to pay the amount of leave encashment of
Rs.6,85,620/- with interest at the rate of 8% considering
the retirement dated of 31.05.2020 till the recovery and
further ordered to pay expenses of Rs.10,000/-.
2. It is the case of the present petitioner that the
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
respondent was serving as an in-charge Officer and he
completed his 28 years of service and retired on
31.05.2020. At the time of retirement in the leave card
of the respondent, there was 300 leave which was
credited which was not paid by the respondent,
therefore, the application under section 33(C)(2) of the
Industrial Disputes Act, 1947 (hereinafter referred to as
the "I.D.Act") was filed which was not paid by the
present petitioner. Application under section 33(C)(2) of
the I.D.Act was filed before the learned labour court,
learned labour court, after considering the evidence,
more particularly, the cross-examination of the witness
of the present petitioner who admitted in his evidence
that there were 300 leave credited as stated in the leave
card which was withheld by the petitioner without
following due procedure of law, has allowed the
application filed under section 33(C)(2) of the I.D.Act
which is subject matter of challenge before this Court.
3. Heard learned advocate Mr.Nirav.C.Thakkar for the
petitioner.
4. Learned advocate Mr.Thakkar submitted that instead of
filing the reference with regard to the leave encashment,
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
application under section 33(C)(2) of the I.D.Act is filed.
It is submitted by the learned advocate Mr.Thakkar that
learned court would not have jurisdiction to decide the
first claim of the respondent with regard to the
entitlement and then to proceed by computing the
benefits. Learned advocate Mr.Thakkar submits that the
claim which was raised is first required to be
adjudicated by the learned reference court under section
10 of the I.D.Act. However, instead of same, application
which is in the nature of execution application came to
be filed, hence the impugned award deserves to be set
aside by allowing the present petition.
5. Having considered the arguments advanced by the
learned advocate for the petitioner as well as referring
to the reasons assigned by the learned labour court, it
emerges from the record that at the time of retirement
i.e. on 31.05.2020, payment of leave encashment of 300
days was not made as per the documentary evidence
produced below mark 7/1 300 days' leave encashment
was in the credit of the leave card. The explanation
offered by the present petitioner for withholding the said
benefit was with regard to the recovery of the amount
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
from one AGRO Industries who has taken goods on
credit. It is not disputed by the witness of the present
petitioner that no departmental inquiry was initiated,
neither any separate order was passed withholding the
said benefits.
6. At this stage, reference of the decision rendered by this
Court in the case of Ahmedabad Municipal
Corporation Versus Sadgunbhai Semulbhai Solanki
in Special Civil Application No.12834 of 2018 is
required to be referred to which is reproduced herein
below:-
"7.1 The gratuity case which was filed by the respondent was
also awarded in favour of the respondent by holding that
respondent would be entitled for the gratuity amount considering
the date of retirement i.e
07.06.2013. Though above order is challenged before the higher
forum but is ultimately accepted by the petitioner Corporation and
amount is paid to the respondent workman. So far as the claim of
unauthorized leave from 07.03.2013 to 30.04.2014 is concerned, it
is undisputed that there is no departmental proceedings initiated
claiming that this period would be considered unauthorized leave
or any intimation was addressed to the respondent to resume duty
immediately in absence of deposit of one month notice pay. Claim
of the petitioner that he did not pay the one month notice pay is
also misconceived as from the application dated 07.03.2013 itself
it clarifies that respondent has shown his willingness to deposit
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
this amount in the event of acceptance of application. As there
was no acceptance for the period of three months no necessity
arose for payment of one month notice pay. At this stage, for
determining issue with regard to leave encashment period Rule 22
of GCSR, 2002 as well as Rule 63 is required be referred which is
reproduced hereinbelow:
"22.Leave at credit to cease on removal or resignation:
(1) Except as provided in rule-63 and this rule, any claim to leave
to the credit of a Government employee, who is dismissed or
removed or who resigns from Government service, ceases from the
date of such dismissal or removal or resignation, as the case may
be.
(2) A temporary Government employee who is discharged due to
shaliction of establishment and re-employed, the leave at his
credit bhall be carried forward provided employed, the
leaveservice or the break in service not exceeding thirty days is
converted into joining time with or without pay.
(3) A Government employee, who is removed or dismissed from
service but is re-instated on appeal or revision. shall be entitled to
count his service prior to dismissal or removal, as the case may
be, for leave.
63.Leave beyond the date of compulsory retirement or quitting
of service :
(1) Except as provided hereinafter, no leave shall be granted to a
Government employee beyond -
a) the date of his compulsory retirement, or
b) the date of his final cessation of duties, or
c) the date of his resignation from service.
(2) Where the service of a Government has been extended in the
public interest beyond the date of his compulsory retirement, he
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
may be granted earned leave, subject to maximum of three
hundred days."
8. As the claim of the respondent is based on certificate
issued by the Corporation produced below mark 15/1 it cannot be
said that learned Labour Court has committed error in awarding
the reference in favour of the respondent. Leave encashment is
akin to salary which is property and depriving a person of his
property without valid statutory provision is violation of the
provision of Constitution of India. If an employee has earned the
leave and employee has chosen to accumulate his earned leave to
his credit then encashment becomes his right and in absence of
any authority that right cannot be infringed by the petitioner
Corporation. Considering the same, this Court deems it fit to
dismiss the petition being devoid of merits and confirm the order
passed by the learned Labour Court in Recovery Application
No.558 of 2013 dated 23.01.2018."
7. The decision rendered by this Court was upheld by the
Division Bench in the intra court appeal by observing as
under:-
"3. Learned advocate Mr. H.S. Munshaw has contended that the
order passed by the learned Single Judge and the controlling
authority require to be set aside since the respondent employee
has tendered his resignation by the communication dated
07.03.2013 to be made effective from 26.03.2013 and he has not
paid the amount of Rs.9,090/- towards three months notice pay
and hence, the respondent employee would not be entitled to the
amount of leave encashment. No further submissions are
advanced.
4. The learned Single Judge after recording the above and after
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
perusing the impugned order passed by the Labour Court rejected
the writ petition. We do not find any illegality in the order passed
by the learned Single Judge confirming the award passed by the
Labour Court. The award passed by the Labour Court is also just
and proper. The learned Single Judge after appreciating the
provisions of Rule 49(1)(2) of Gujarat Civil Service (Pension)
Rules, 2002 has held that the respondent-AMC done has not
accepted or rejected the application filed by the respondent
employee after tendering his resignation.
5. It is noticed by us that while tendering the resignation on
07.03.2013, the employee had also clarified that the notice pay of
1/2/3 months will be paid by him. However, the appellant-AMC
did not do anything on the resignation and only called upon the
respondent employee by the communication dated 07.03.2013 and
thereafter, also on 19.10.2013, the employee was informed to pay
the aforesaid amount. Thus, if it was the case of the appellant-
AMC that the resignation became ineffective for non payment of
notice pay, they could have passed appropriate order of refusing
to accept. It is also very pertinent to note that the employee has
tendered his resignation before he reached the age of
superannuation while on reaching the age of 58 years, it was from
30.04.2014, i.e. after a period of 1 year. The respondent employee
had tendered his resignation after completion of 57 years and had
completed his service from 1975 till the order of 2013, i.e. more
than 38 years. The appellant cannot approbate and reprobate.
Curiously, the stand of the appellant-AMC is that the resignation
tendered by the respondent-employee cannot be accepted, and
simultaneously, he is allowed to retire at the age of 57 years,
without extending the benefit of leave encashment. In case, his
resignation was not found suitable for acceptance, then as a
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
necessary sequel, he has to be treated as retired on
superannuation with the benefit of leave encashment. There is no
provision pointed before us that in case an employee resigns, he
would not be entitled to the amount of leave encashment.
6. Thus the present appeal is devoid of merits and fails. We
further clarify that we have not expressed any opinion on the
resignation tendered by the respondent-employee."
8. The second ground on which the petition is filed i.e.
regarding the jurisdiction of the learned Labour Court to
entertain the application filed under Section 33-C(2) of
the Industrial Disputes Act,1947, this issue is also
decided by the Division Bench of this Court in L.P.A.
No.1653 of 2017 in the judgment dated 30.07.2019
wherein following observations are made in para 4:
"4. Having heard learned advocates appearing for the respective
parties, we are not inclined to entertain the present appeals when
the issue involved in present appeals has already been heard and
decided by this Court by way of order dated 07.05.2018 rendered
in Letters Patent Appeal No. 558 of 2018. Paragraph no. 3 of the
said order reads as under: "3. We have perused the order passed
by the Labour Court as well learned Single Judge and circular
dated 2.12.2015 applicable in the case of workman. Even
objections raised and reply filed by the employer in the
application filed under Section 33 (C) (2) of I.D.Act, 1947 towards
claim of leave encashment and interest etc., and other resolutions
including that of 17.10.1988, we find that it is not in dispute that
on completion of number of years of service so envisaged in the
NEUTRAL CITATION
C/SCA/8619/2025 JUDGMENT DATED: 03/07/2025
undefined
G.R. Dated 17.10.1988 namely, 15, 20 and 25 years w.e.f.
1.10.1988 such rojamdar/workman is entitled for various benefits
available to the regular and permanent employee. Even DCRG and
pension is also available to such employees. We find no reason
that such workman should not be entitled for leave encashment
available to other employees and accordingly, we do not find any
reason to interfere with the order impugned passed by learned
Single Judge."
9. Considering the above decisions, this Court is of the
view that merely denial of the right by the employer may
not be sufficient to negate the claim made under Section
33-C(2) of the Industrial Disputes Act, 1947 before the
learned Labour Court and would not take away the
jurisdiction of the learned Labour Court. The jurisdiction
of the learned Labour Court is not confined to the
admitted claim and existing rights does not mean any
admitted rights, it only means that right to claim exist
and vested with the workman.
10. In view of the above, this Court did not find any
substance in the merits of the present petition, hence
this petition deserves to be dismissed.
11. Resultantly, this petition is dismissed.
(M. K. THAKKER,J)
NIVYA A. NAIR
