Krishna Bahadur Vs. M/S Purna Theatre & Ors  Insc 495 (25 August 2004)
N. Santosh Hegde & S.B.
Sinha S.B. Sinha, J :
The workman is in appeal before us being aggrieved by and dissatisfied with
the judgment and order dated 13.10.2000 passed by the Division Bench of the
High Court of Calcutta in Appeal No.434 of 1996.
The case at hand has a chequered history. The appellant herein was appointed
in the post of Messenger-cum-Bearer in the establishment of the respondent
herein, a Cinema House, on 31.3.1978. He was subsequently confirmed on the said
post. A disciplinary proceeding was initiated against him wherein he was found
guilty, whereupon he was dismissed from services. The said order of dismissal
was the subject-matter of an industrial dispute. The Industrial Tribunal by
reason of an award set aside the said order of dismissal with full back-wages
and compensation. On or about 1.5.1991, the appellant was permitted to join his
duties but back-wages were not paid. He was, however, retrenched from services
within one month from his joining i.e. 30.5.1991. A sum of Rs.9,030/- was paid
as retrenchment compensation which the appellant is said to have received under
protest. A trade union known as Bengal Motion Pictures Employees Union took up
the cause of the Appellant, inter alia, on the ground of contravention of the
legal requirements as contained in Section 25-G of the Industrial
Disputes Act, 1947 as also insufficiency of the amount of compensation paid
to the appellant in terms of Section 25-F(b) thereof. An industrial dispute as
regard his retrenchment was raised before the Assistant Labour Commissioner
which failed; whereupon the Industrial Tribunal was approached by the Appellant.
In the meanwhile, the appellant had also initiated a proceeding under Section
33-C(2) of the Industrial
Disputes Act, 1947 which
ended in an amicable settlement in terms whereof the Appellant allegedly agreed
to receive a sum of Rs.39,000/- as full and final settlement.
He had accepted a cheque for the aforementioned sum of Rs.9,030/- issued by
the management allegedly as part payment of his compensation of Rs.39,000/-
which was deducted from the aforementioned settled amount of Rs.39,000/-. The
Industrial Tribunal by its order dated 28.12.1995 held :
"Having regard to the facts and circumstances and in consideration of
the evidence and record I hold that the retrenchment of the concerned workman
was illegal and as such he should be deemed to be in continuous service with
all benefits. The issues are answered accordingly." A writ petition was
filed by the respondent herein questioning the correctness or otherwise of the
said award before the Calcutta High Court which was marked as Writ Petition
No.1872 of 1996. The said writ petition was dismissed by a learned Single
Judge, holding :
"Thus, regarding (sic regard) being had the principles of law discussed
above in the light of the fact and circumstances of the instant case, I have no
hesitation to hold that the impugned retrenchment was effected without
complying with the mandatory requirements of Section 25F(b) of the Industrial
Disputes Act and that the Tribunal was well within its jurisdiction in
recoding a finding to that effect. Such a retrenchment must, accordingly, be
held to be void ab intio and consequently, the respondent must be deemed to be
in service and entitled to all consequential benefits. I, therefore, find no
justification for quashing the impugned Award. In such view of the matter, the
petitioner is not entitled to any relief and the instant writ application
fails. The writ application is, accordingly, dismissed without, however, any
order as to costs." The respondent herein preferred an appeal thereagainst
before a Division Bench of the Calcutta High Court which was marked as Appeal No.434
of 1996. A plea as regard substantial compliance of the requirements of law on
the part of the workman was raised for the first time.
Accepting the said plea, the Division Bench by reason of the impugned
judgment allowed the appeal holding :
"So, the fact remains that the employer bona fidely paid the said
amount of Rs.9030.30 along with the notice of retrenchment and the workman duly
accepted the said amount. Hence, the plea of waiver in a case of this nature as
argued by the ld.
Advocate for the appellant can be upheld. Above all, when the employer bona
fidely paid the major part of retrenchment compensation after a bona fide
calculation, not opposed by anybody till the argument before the Tribunal, we
fail to understand as to why the employer can be punished by ordering him to
pay the entire backwages with the privilege of immediate reinstatement as
ordered in the award. Following the principle adopted by the Apex Court in 1980
(II) LLJ 124 (SC) (Workman of Sudder Workshop of Jhorhat Tea Company vs. The
Management), we deem, it proper not to punish the employer as above only for an
alleged shortfall of Rs.552..87 which was not pleaded in the written statement
of the workman. We do not think that non-payment of Rs.552.87 as calculated in
the award at the argument stage only, can make the retrenchment order nugatory.
On the other hand, we take the view, following the principle adopted in Workmen
of Coimbatore Pioneer 'B' Ltd. (supra) that for non non-payment of the short
compensation of Rs.552.87, a substantial amount can be paid as compensation.
Accordingly, in setting aside the award and allowing this appeal, the
appellant is directed to pay a sum of Rs.552.87 (rounded off to Rs.553) along
with a compensation of Rs.6634.50 (equivalent to wages for six months) to the
workman the respondent no.4 within six weeks." The workman, thus, is in
appeal before us from the said judgment.
The respondent management has not appeared despite service of notice.
Mr. Bijan Kumar Ghosh, learned counsel appearing on behalf of the appellant,
would submit that the Division Bench of the High Court committed a manifest
error in passing the impugned judgment and order insofar as it failed to take
into consideration that Section 25-F(b) of the Industrial
Disputes Act is imperative in character. Keeping in view the fact that
admittedly the said legal requirements thereof had not been complied with and
furthermore plea of waiver having not been raised before the Tribunal or before
the learned Single Judge, it was impermissible for the Division Bench to pass
the impugned judgment.
We may usefully refer to the submissions made on behalf of the respondent management
in writ proceedings as had been noticed by the learned Single Judge of the High
Court in his judgment:
"Mr. Arunava Ghosh, ld. Advocate appearing for the petitioner company,
raised the following points.
First, it was urged that the Tribunal fell into error of law in coming to a
conclusion that there was non-compliance of requirements of Sec.25- F(b) in as
much as such a plea was never put forward on behalf of the workman in his
written statement nor was it substantiated by any evidence.
Secondly it was contended that when the Workman did neither raised any plea
of inadequacy of the retrenchment compensation nor adduce any evidence in this
regard, the Tribunal should not have embarked upon an inquiry for the purpose
of ascertaining whether the compensation money was adequate or not. Thirdly, it
was contended that as there was neither any pleading nor any evidence regarding
the shortfall in the payment of retrenchment compensation, the Tribunal could
not go into that question at the stage of argument. Fourthly, it was urged that
omission to maintain seniority list under Rule 77A does not render the
retrenchment illegal or bad in law, particularly when there was clear admission
on the part of the workman in his evidence that he was the last person to be
employed in the category of workman to which he belonged and as such the
Tribunal's finding, if there be any, regarding the observance of the principles
of 'last come first go' as contemplated under Section 25G was perverse and was
not based on evidence. Mr. Ghosh cited a number of decisions in support of his
contentions." It is, therefore, evident that the question of a bona fide
action on the part of the employer or waiver on the part of the appellant
herein had not been raised. The respondent before the learned Single Judge was
although very emphatic as regard compliance of requirements of Section 25-F(b)
of the Industrial
Disputes Act but no contention as regard the plea of waiver was raised.
Even the question of substantial compliance or bonafide action on the part of
the said respondent was not raised.
The principle of waiver although is akin to the principle of estoppel;
the difference between the two, however, is that whereas estoppel is not a
cause of action; it is a rule of evidence; waiver is contractual and may
constitute a cause of action; it is an agreement between the parties and a
party fully knowing of its rights has agreed not to assert a right for a
A right can be waived by the party for whose benefit certain requirements or
conditions had been provided for by a statute subject to the condition that no
public interest is involved therein. Whenever waiver is pleaded it is for the
party pleading the same to show that an agreement waiving the right in consideration
of some compromise came into being.
Statutory right, however, may also be waived by his conduct.
In Bank of India and Others etc. vs. O.P. Swarnakar and Others etc.
[(2003) 2 SCC 721], it was noticed :
"115.The Scheme is contractual in nature. The contractual right derived
by the employees concerned, therefore, could be waived. The employees concerned
having accepted a part of the benefit could not be permitted to approbate and
reprobate nor can they be permitted to resile from their earlier stand."
It is neither in doubt nor in dispute that the provision of Section 25- F(b) is
imperative in character. The provision postulates the fulfillment of the
following three conditions :
(i) One month's notice in writing indicating the reasons for retrenchment or
wages in lieu of such notice;
(ii) Payment of compensation equivalent to fifteen days, average pay for
every completed year of continuous service or any part thereof in excess of six
months; and (iii) Notice to the appropriate Government in the prescribed
The requirement to comply with the provision of Section 25-F(b) has been
held to be mandatory before retrenchment of a workman is given effect to. In
the event of any contravention of the said mandatory requirement, the
retrenchment would be rendered void ab initio.
In Workmen of Sudder Workshop of Jorehaut Tea Co. Ltd. vs. The Management
[(1980) 2 L.L.J. 124], whereupon reliance had been placed by the Division
Bench, this Court held :
"That apart, if there be non-compliance with S.
25F, the law is plain that the retrenchment is bad." In that case,
however, compensation had been computed on the basis of wages previously paid
and not on the basis of the Wage Board Award.
The retrenchment took place on 5.11.1986. No plea as regard non-payment of
compensation calculated on the basis thereof was taken before the Tribunal.
Even the award did not proceed on that basis.
The new plea based on the facts was not permitted to be raised by the High
Court. This Court noticed that the Wage Board Award was subsequent to the
retrenchment; although it was applied retrospectively i.e. with effect from
1.4.1966. In that situation, it was observed :
"In the absence of any basis for this new plea we are unable to reopen
an ancient matter of 1966 and, agreeing with the High Court, dismiss the
appeal. But the 16 workmen, being eligible admittedly for the Wage Board scale,
will be paid the difference for the period between 1.4.1966 to 5.11.1966."
We may furthermore notice that the learned Industrial Tribunal interfered with
the retrenchment of the appellant not only on the ground of non-compliance of
the provisions of Section 25-F(b) of the Industrial Disputes Act
but also on the ground of contravention of Rule 77-A of the West Bengal
Industrial Disputes Rules, stating :
"Moreover the company has not shown by means of a seniority lists that
the concerned workman was the junior most amongst the same category of workers.
When there is such a controversy and when no such lists was maintained by the
company although maintaining of such lists can be said to be a compulsory
compliance of the rules framed under the Industrial
Disputes Act on the part of the Company (Vide 77A of the West Bengal
Industrial Disputes Rules) it must be held that the retrenchment was illegal.
Mere evidence to show the seniority of the workman of a particular category is
not enough to justify a retrenchment of a workman on the ground of surplus
hand." After a detailed reference to the evidence adduced on behalf of the
Management, the Tribunal held :
"I do not understand why the company keeps lacuna in observing the
legal procedure provided by the rules framed under the statute to maintain
peace and harmony. In the industry particularly which are very much formal and
not at all difficult to be maintained and can be done with least effort.
This has been very much necessary and essential in this case in its peculiar
background when the concerned workman is going to be retrenched within a very
short period after his reinstatement with full back wages and incidental
benefits by virtue of an award by the Seventh Industrial Tribunal in an earlier
reference Case No.1647- I.R./IR/11L-24/85 corresponding to Case NO.VIII- 152/86
after he was dismissed from service. The Company should have maintained the
seniority lists as required under the rule to show from impartial attitude
towards the workman in the category to which Krishna Bahadur belongs. That
having not been done the action of the Company suffers from informative (sic
for infirmities) and it deserves to be nullified." It would appear from
the judgment of the learned Single Judge dated 25.9.1996 in Writ Petition
No.1872 of 1996 that correctness or otherwise of the finding of the Industrial
Tribunal as regard non-compliance of the provisions of Rule 77A of the West
Bengal Industrial Disputes Rules had been questioned. The said contention must
be held to have negatived by the learned Single Judge also keeping in view the
provisions analogous to Explanation-V appended to Section 11 of the Code of
Civil Procedure. The Division Bench of the High Court unfortunately did not
address itself to the said question at all.
For the reasons aforementioned, the impugned judgment of the Division Bench
cannot be upheld. It is set aside accordingly and the judgment of the learned
Single Judge upholding the award passed by the Industrial Tribunal is restored.
The appeal is allowed. In the facts and circumstances of the case, there shall
be no order as to costs.