Madhya Pradesh High Court
Manager Farseen Ruber Industries Ltd., ... vs Raj Bahadur Singh on 3 March, 2025
Author: Milind Ramesh Phadke
Bench: Milind Ramesh Phadke
NEUTRAL CITATION NO. 2025:MPHC-GWL:5749
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IN THE HIGH COURT OF MADHYA PRADESH
AT GWALIOR
BEFORE
HON'BLE SHRI JUSTICE MILIND RAMESH PHADKE
ON THE 3 rd OF MARCH, 2025
WRIT PETITION No. 3008 of 2012
MANAGER FARSEEN RUBER INDUSTRIES LTD., BANMORE
Versus
RAJ BAHADUR SINGH AND OTHERS
Appearance:
Shri Jitendra Sharma - Sr. Advocate with Ms. Yasika Nayak - Advocate for
petitioner.
Shri Nitin Goyal - Advocate for respondent [R-1].
ORDER
The present petition under Article 227 of the Constitution of India has been
filed by the petitioner against the order dated 29.04.2011 passed by Labour Court
No.1, Gwalior in case No.33/A/ID Act/04 (Ref.), by which the termination of the
services of the respondent No.1 has been held to be bad and direction was issued
for his reinstatement. The petitioner is further aggrieved by the order dated
20.01.2012 passed in Case No. 82/F/11/ID Act/04 passed by Labour Court No.1,
Gwalior whereby the review petition preferred against the order dated 29.04.2011
has been rejected.
2. Challenging the order/award passed by the Court below, the counsel for
the petitioner has submitted that the respondent had not completed 240 days of his
service in a calendar year but ignoring the said fact, the order had been passed
which is bad in law. It was further submitted that in cases where termination of an
employee is found to be illegal, reinstatement is not automatic and instead the
workman can also be compensated by giving monetary compensation, which
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would meet the ends of justice. It was further submitted that since the Court below
has come to a conclusion that the termination of the respondent is bad in law,
looking to the length of service and the period for which is out of employment, it
should not have directed for reinstatement, and could have awarded monetary
compensation in lieu of reinstatement.
3. So far as the compensation in lieu of reinstatement is concerned, the
counsel for the petitioner has relied upon the judgment of Supreme Court in the
case of Jeetubha Khansangji Jadeja Vs. Kutchh District Panchayat, decided on
23.09.2022 in Civil Appeal No.6890/2022.
4. Per contra, the petition is vehemently opposed by the counsel for the
respondent and it was submitted that the petitioner did not file any document to
prove that the respondent has not worked for more than 240 days in a calendar
year though the petitioner was in possession of every document and he could have
proved that the petitioner has not worked for the statutory period.
5. It was further submitted that it is well established principle of law that if a
party, who is in possession of best evidence, fails to produce the same then, an
adverse inference can be drawn. Furthermore, the finding recorded by the Court
below is a finding of fact and in absence of any perversity, the same may not be
interfered with.
6. Heard counsel for the parties and perused the record.
7. So far as the finding given by the Court below that the termination of the
respondent was illegal is concerned, the petitioner being the employer was in
possession of every document to show that the respondent had not worked for
more than 240 days. Admittedly, the petitioner did not bring any evidence on
record to rebut the claim of the respondent that he had worked for more than 240
days. It is well established principle of law that if a party is in possession of best
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evidence and fails to produce the same, then an adverse inference can be drawn
against it. Under these circumstances, this Court is of the considered opinion that
the Court below did not commit any mistake by holding that the respondent has
worked for more than 240 days.
8. So far as the question of reinstatement with back wages with
compensation of 10% amount is concerned, the Supreme Court in the matter
of Bharat Sanchar Nigam Limited Vs. Bhurumal reported in (2014) 7 SCC 177
has held 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.
Rationale for shifting in this direction is obvious."
9. Further, the Supreme Court in the matter of Jayant Vasantrao Hiwarkar
Vs. Anoop Ganaptrao Bobde reported in (2017)11 SCC 244 has upheld the grant
of compensation in lieu of reinstatement as the respondent had merely worked for
a period of one year.
10. The Supreme Court in the case of Hari Nandan Prasad Vs. Food
Corporation of India, reported in (2014) 7 SCC 190 has held as under:-
''19. The following passages from the said judgment would reflect the
earlier decisions of this Court on the question of reinstatement: (BSNL
case, SCC pp. 187-88, paras 29-30)
"29. The learned counsel for the appellant referred to two judgments
wherein this Court granted compensation instead of reinstatement. In
BSNL v. Man Singh, this Court has held that when the termination is set
aside because of violation of Section 25-F of the Industrial Disputes
Act, it is not necessary that relief of reinstatement be also given as a
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matter of right. In Incharge Officer v. Shankar Shetty, it was held that
those cases where the workman had worked on daily-wage basis, and
worked merely for a period of 240 days or 2 to 3 years and where the
termination had taken place many years ago, the recent trend was to
grant compensation in lieu of reinstatement.
30. In this judgment of Shankar Shetty, this trend was reiterated by
referring to various judgments, as is clear from the following
discussion: (SCC pp. 127-28, paras 2-4) '2. Should an order of
reinstatement automatically follow in a case where the engagement of a
dailywager has been brought to an end in violation of Section 25-F of
the Industrial Disputes Act, 1947 (for short "the ID Act")? The course
of the decisions of this Court in recent years has been uniform on the
above question.
3. In Jagbir Singh v. Haryana State Agriculture Mktg. Board, delivering
the judgment of this Court, one of us (R.M. Lodha, J.) noticed some of
the recent decisions of this Court, namely, U.P. State Brassware Corpn.
Ltd. v. Uday Narain Pandey, Uttaranchal Forest Development Corpn. v.
M.C. Joshi, State of M.P. v. Lalit Kumar Verma, M.P.
Admn. v. Tribhuban, Sita Ram v. Moti Lal Nehru Farmers Training
Institute, Jaipur Development Authority v. Ramsahai, GDA v. Ashok
Kumar and Mahboob Deepak v. Nagar Panchayat, Gajraul a and stated
as follows: (Jagbir Singh case, SCC pp. 330 & 335, paras 7 & 14)
"7. It is true that the earlier view of this Court articulated in many
decisions reflected the legal position that if the termination of an
employee was found to be illegal, the relief of reinstatement with full
back wages would ordinarily follow. However, in recent past, there has
been a shift in the legal position and in a long line of cases, this Court
has consistently taken the view that relief by way of reinstatement with
back wages is not automatic and may be wholly inappropriate in a given
fact situation even though the termination of an employee is in
contravention of the prescribed procedure. Compensation instead of
reinstatement has been held to meet the ends of justice.
***
14. It would be, thus, seen that by a catena of decisions in recent time,
this Court has clearly laid down that an order of retrenchment passed in
violation of Section 25-F although may be set aside but an award of
reinstatement should not, however, be automatically passed. The award
of reinstatement with full back wages in a case where the workman has
completed 240 days of work in a year preceding the date of termination,
particularly, daily-wagers has not been found to be proper by this Court
and instead compensation has been awarded. This Court has
distinguished between a daily-wager who does not hold a post and a
permanent employee."
4. Jagbir Singh has been applied very recently in Telegraph Deptt. v.
Santosh Kumar Seal, wherein this Court stated: (SCC p. 777, para 11)
11. In view of the aforesaid legal position and the fact that the workmen
were engaged as dailywagers about 25 years back and they worked
hardly for 2 or 3 years, relief of reinstatement and back wages to them
cannot be said to be justified and instead monetary compensation would
subserve the ends of justice.'"
****
21. We make it clear that reference to Umadevi, in the aforesaid
discussion is in a situation where the dispute referred pertained to
termination alone. Going by the principles carved out above, had it been
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a case where the issue is limited only to the validity of termination,
Appellant 1 would not be entitled to reinstatement...........''
11. The Supreme Court in the matter of O.P. Bhandari Vs. Indian Tourism
Development Corporation Limited & Others reported in (1986) 4 SCC 337 has
held as under :-
"6. Time is now ripe to turn to the next question as to whether it is
obligatory to direct reinstatement when the concerned regulation is
found to be void. In the sphere of employer-employee relations in
public sector undertakings, to which Article 12 of the Constitution of
India is attracted, it cannot be posited that reinstatement must invariably
follow as a consequence of holding that an order of termination of
service of an employee is void. No doubt in regard to "blue collar"
workmen and "white collar" employees other than those belonging to
the managerial or similar high level cadre, reinstatement would be a
rule, and compensation in lieu thereof a rare exception. Insofar as the
high level managerial cadre is concerned, the matter deserves to be
viewed from an altogether different perspective -- a larger perspective
which must take into account the demands of National Interest and the
resultant compulsion to ensure the success of the public sector in its
competitive co-existence with the private sector. The public sector can
never fulfil its life aim or successfully vie with the private sector if it is
not managed by capable and efficient personnel with unimpeachable
integrity and the requisite vision, who enjoy the fullest confidence of the
"policy-makers" of such undertakings. Then and then only can the
public sector undertaking achieve the goals of (1) maximum production
for the benefit of the community, (2) social justice for workers,
consumers and the people, and (3) reasonable return on the public funds
invested in the undertaking.
7. It is in public interest that such undertakings or their Boards of
Directors are not compelled and obliged to entrust their managements to
personnel in whom, on reasonable grounds, they have no trust or faith
and with whom they are in a bona fide manner unable to function
harmoniously as a team working arm-in-arm with success in the
aforesaid three- dimensional sense as their common goal. These factors
have to be taken into account by the court at the time of passing the
consequential order, for the court has full discretion in the matter of
granting relief, and the court can sculpture the relief to suit the needs of
the matter at hand. The court, if satisfied that ends of justice so demand,
can certainly direct that the employer shall have the option not to
reinstate provided the employer pays reasonable compensation as
indicated by the court."
12. In the present case, the termination of the respondent was held to be
illegal, but this Court, looking to the date of termination i.e. 29.01.2003 and the
length of the service which is about 05 years, is of the considered opinion that the
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Court below should have directed for payment of monetary compensation in lieu
of reinstatement.
13 . Accordingly, the impugned order dated 29.04.2011 passed by Labour
Court No.1, Gwalior in 33/A/ID Act/04(Ref.) is modified and in place of
reinstatement, it is directed that the respondent shall be entitled for monetary
compensation of Rs.2,00,000/- (Rupees Two Lakhs only).
14. Accordingly, the petition stands allowed to the extent indicated
hereinabove.
(MILIND RAMESH PHADKE)
JUDGE
ojha
