Sriram Industrial Enterprises Ltd Vs. Mahak Singh & Ors  Insc 254 (8 March
Dr.AR. Lakshmanan & Altamas Kabir
ALTAMAS KABIR, J.
Five different writ petitions were filed by the different respondents in
these special leave petitions before the High Court of Judicature at Allahabad
against the awards made by the Industrial Tribunal on 20th June, 1998. The said writ petitions having been allowed by a common judgment dated 15th April,
2005, the petitioner herein, which was the common respondent in all the writ
petitions, has filed these special leave petitions questioning the judgment and
order of the Allahabad High Court.
The writ petitioners/respondents herein claimed to have been appointed by
the petitioner between the years 1987-1991 and it is their case that they
worked continuously from the date of their appointment till they were
retrenched in the years 1994 and 1995 respectively. The specific case made out
by the respondents is that although they have worked continuously from the date
of their appointment for more than 240 days in a calendar year, they have been
illegally retrenched from service in violation of the provisions of Section 6 N
of the U.P. Industrial Disputes Act, 1947 ( for short 'the U.P. Act').
The respondents raised a dispute relating to their retrenchment which was
ultimately referred by the State Government to the Tribunal under Section 4 K
of the aforesaid Act to determine as to whether the termination of the services
of the workmen by the employer was just and/or illegal.
Pursuant to the said References, five separate Adjudication Cases, being
Nos. 134,139,132, 129 and 127 of 1995 were registered by the Presiding Officer,
Industrial Tribunal (V), U.P.
In support of their contention that they had been illegally retrenched, the
respondents submitted that not only had they worked continuously from the date
of their appointment till their services were terminated, but that they had
been allowed grade number and provident fund number and other service benefits.
It is also the case of the respondents that as they had demanded other benefits
to which they were entitled, their services were terminated without any notice
and compensation being given to them. They accordingly claimed reinstatement in
service with all back wages.
The case of the petitioner herein is that since the sugar industry is a
seasonal industry, most of the work force are engaged as casual and temporary
hands during the operational season and that this state of affairs is common to
the entire sugar industry. It was also the case of the petitioner that the real
dispute was not with regard to the termination of the services of the workmen,
but with regard to their claim for regularisation of their services. It was
also the case of the petitioner that the services of the workmen had never been
terminated since none of them had worked for 240 days in the last 12 calendar
months immediately preceding their alleged date of termination.
As recorded by the Tribunal, the respondents had produced bonus slips, wage
slips, deduction of provident fund slips and attendance cards for various
months and other documents available to them. They had also requested the
petitioner herein to produce certain documents which were in its custody and
included the Attendance Register, payment of bonus record and various other
documents relating to the engagement of the respondents as workmen under it.
Admittedly, on behalf of the petitioner herein, only the extract of the
attendance record of the last 12 calendar months of the workmen immediately
preceding the date of their retrenchment had been produced from which it was
evident that none of the workmen had worked for more than 240 days during the
said period. The Tribunal also noted that the petitioner had failed to assign
any cogent reason for not producing the Attendance Registers of the previous
years and allowed the workmen to lead secondary evidence in support of their
The Tribunal did not lay any importance to the non- production of the
documents asked for on the ground that the petitioner did not keep such record
relating to the temporary hands and relied on the documents that had been
produced to come to a finding that the workmen had not put in 240 days of
service in a calendar year preceding the termination of their services.
Being aggrieved by the awards passed by the Tribunal, the workmen filed
separate writ petitions praying for quashing of the impugned awards and
declaring their retrenchment to be illegal, together with a prayer to reinstate
them in service with full back wages and continuity of service.
Drawing an adverse inference against the petitioner herein for
non-production of the documents in its possession and holding that the
petitioner had failed to discharge the onus and disprove the workmens' claim,
the High Court held that under the circumstances the Tribunal should have drawn
an adverse presumption under Section 114 Illustration (g) of the Indian Evidence
Act, 1872 against the petitioner.
Taking further note of the expression "continuous service"
under Section 2 (g) of the U.P. Act, the High Court found that the
termination of service of the workmen was in violation of Section 6 N of the
aforesaid Act. Basing its decision on its aforesaid findings, the High Court
quashed the awards passed in the adjudication cases referred to above and
directed the petitioner herein to reinstate the workmen/respondents herein with
continuity of service and half back wages with effect from 1995, being the date
of their illegal retrenchment.
These special leave petitions have been filed against the common judgment of
the High Court by which the five writ petitions were disposed of with the
The case made out by the petitioner herein before the Tribunal and the High
Court was reiterated by Mr. Ashok Desai, learned senior advocate, appearing for
The main thrust of his submission was that since the respondents had not
completed 240 days of service in the year preceding the date of alleged
termination, the High Court had erroneously reversed the findings of the
Tribunal on such score. Mr. Desai reiterated the contention of the petitioner
that work in the sugar industry was of a seasonal nature and most of the work
force was engaged as casual labour on a temporary basis, which was generally
confined to six to seven months in a year. Mr. Desai submitted that the
Tribunal had correctly assessed the situation and the High Court by drawing an
adverse presumption for non-production of the Attendance Register of prior
years, had erroneously arrived at the conclusion that the respondents-workmen
had, in fact, worked for more than 240 days in a calendar year prior to
termination of their services.
Mr.Desai submitted that it is settled law that the onus of proof of having
worked for 240 days within a calendar year is on the employee. According to Mr.
Desai, the employee was required to discharge the burden of proving that he had
actually worked for 240 days in a calendar year, but the High Court had wrongly
shifted the onus on the employer in contravention of the law as laid down by
this Court in Range Forest Officer vs. S.T. Hadimani, reported in (2002) 3 SCC
25. In the said case, this Court while considering a similar issue observed
as follows:- "In our opinion, the Tribunal was not right in placing the
onus on the Management without first determining on the basis of cogent
evidence that the respondent had worked for more than 240 days in the year
preceding his termination. It was the case of the claimant that he had so
worked but this claim was denied by the appellant. It was then for the claimant
to lead evidence to show that he had, in fact, worked for 240 days in the year
preceding his termination."
Mr. Desai also referred to the decision of this Court in the case of
Municipal Corporation, Faridabad vs. Siri Niwas, reported in (2004) 8 SCC 195.
In the said case, the respondent's case relating to his termination from
service had been referred to the Labour Court. His case before the Tribunal was
that he had completed working for 240 days in a year and the order of
retrenchment was, therefore, illegal as conditions precedent for passing such
an order as contained in Section 25F of the Industrial Disputes Act, 1947, (for
short 'the Central Act') had not been complied with. Section 25F of the Central
Act is reproduced hereinbelow:- Conditions precedent to retrenchment of
"25F. No workman employed in any industry who has been in continuous
service for not less than one year under an employer shall be retrenched by
that employer until (a) the workman has been given one month's notice in
writing indicating the reasons for retrenchment and the period of notice has
expired, or the workman has been paid in lieu of such notice, wages for the
period of the notice;
(b) the workman has been paid, at the time of retrenchment, compensation
which shall be equivalent to fifteen days' average pay for every completed year
of continuous service or any part thereof in excess of six months; and (c)
notice in the prescribed manner is served on the appropriate Government or such
authority as may be specified by the appropriate Government by notification in
the Official Gazette."
The contention of the appellant in the said case however was that the
respondent had worked only for 136 days during the preceding 12 months on daily
wages and had no lien over the said job. In that background, this Court held
that the burden of proof was on the respondent-workman to show that he had
worked for 240 days in the preceding 12 months prior to his retrenchment.
The same view was expressed by this Court in Surendranagar District
Panchayat vs. Dahyabhai Amarsinh, reported in (2005) 8 SCC 750, wherein this
Court while referring to the decisions of this Court in the case of Range
Forest Officer (supra) and Municipal Corporation, Faridabad (supra) and two
other decisions in the case of Rajasthan State Ganganagar S. Mills Ltd. vs.
State of Rajasthan and Anr., reported in (2004) 8 SCC 161 and M.P.
Electricity Board vs. Hariram, reported in (2004) 8 SCC 246, reiterated that
the burden of proof lies on the workman to show that he had worked continuously
for 240 days in the preceding one year prior to his retrenchment and it is for
the workman to adduce evidence apart from examining himself to prove the fact
that he had been employed for the said period by the employer.
Various other decisions were also referred to by Mr.
Desai on the aforesaid point which are in consonance with the decision of
this Court in Range Forest Officer (supra).
Mr. Desai also contended that drawing an adverse presumption for
non-production of evidence is not applicable in all cases where other
circumstances may exist on the basis whereof such intentional non-production
may even be found to be justifiable on reasonable grounds. In the instant case,
Mr. Desai submitted that since in paragraph 11 of the respondent's written
statement before the Industrial Tribunal the pleading was restricted to the
fact that he had worked for more than 240 days in the year preceding the date
of termination, the appellant had thought it fit to produce the Attendance
Register for the said period only, namely, for the period comprising the year
preceding the date of termination of the services of the respondents. In fact,
it was the case of the appellant before the Tribunal, as also the High Court,
that the Appellant-company did not maintain the records in respect of temporary
posts. He urged that since the workmen had produced various documents in
support of their claim that they had worked continuously for more than 240 days
they should also have proof of their having worked for 240 days in any
preceding year which could have been produced before the Tribunal in order to
prove that they had actually worked for 240 days continuously during 12
calendar months in any year prior to termination of their services. Mr.
Desai submitted that the respondents had failed to discharge their onus of
proving the aforesaid fact and the Tribunal had rightly rejected their contention.
Mr. Desai reiterated the fact that in one case, the respondent had worked
for only 162.5 days in the 12 months preceding the date of termination of his
services. Mr. Desai also stated that the respondent had not worked at all in
the months of April, May, July, September and December, 1994 which fact had not
been denied on behalf of the respondents.
Mr. Desai contended that most of the documents asked to be produced on
behalf of the respondents were irrelevant to the fact at issue since even the Tribunal
had framed an issue as to whether the concerned workman had worked for more
than 240 days during the last one year of service. It is on such basis that the
Attendance Register for the preceding year had been produced on the basis
whereof the Tribunal came to the finding that the respondent had not put in
more than 240 days of service on 1st February, 1995.
Mr. Desai urged further that the mere statement on affidavit of a workman
that he had worked for 240 days continuously does not constitute sufficient
proof in the absence of other evidence. The said principle was referred to in
the Range Forest Officer (supra) case wherein it was held that filing of an
affidavit is only the statement made by the workman in his own favour which
could not be regarded as sufficient evidence for any Court or Tribunal to
arrive at a conclusion that the workman had, in fact, worked for 240 days in a
year. It was submitted that the same principle was reiterated by this Court in
the case of RBI vs. S. Mani, reported in (2005) 5 SCC 100.
Mr. Desai submitted that while the Tribunal had correctly assessed the legal
position, the High Court had wrongly shifted the burden of proving that the
workman had worked for 240 days or more in a calendar year on the employer. It
was submitted that having proceeded on such erroneous basis, the High Court had
arrived at a wrong conclusion, in the absence of any other material evidence,
that the respondents had, in fact, worked for more than 240 days in a calendar
year preceding the date of termination of their services and such finding was,
therefore, liable to be set aside.
Mr. Viswanathan, learned advocate, who appeared for the workmen submitted
that while the High Court had not disturbed the findings of fact, it had only
corrected the jurisdictional error of the Labour Court which failed to consider
the difference in the definition of "continuous service" mentioned in
Section 25B 2(a) of the Central Act and in Section 2 (g) of the U.P. Act. He
pointed out that in the definition given in the U.P. Act, the word
"preceding" has not been used. Consequently, it was urged that
Section 2 (g) of the U.P. Act does not require a workman to prove that he had
worked for 240 days continuously only during the preceding period of 12 months
prior to termination of his services. The workman was, therefore, entitled to
show that he had worked for 240 days continuously in a calendar year for any
year prior to termination of his services. Mr. Viswanathan submitted that the
said period was not confined under the U.P. Act only to the year preceding the
date of termination.
In support of his submissions Mr. Viswanathan relied on the decision of this
Court in U.P. Drugs and Pharmaceuticals Company Ltd. vs. Ramanuj Yadav and Ors.
reported in (2003) 8 SCC 334, where the said position has been examined and
Regarding Mr. Desai's submissions that this Court had consistently laid down
that it is for the workmen to prove that they had worked for 240 days in a
calendar year, Mr.
Viswanathan submitted that this Court had in the case of R.M. Yellatty vs.
Assistant Executive Engineer, reported in (2006) 1 SCC 106, observed as under:-
"Analysing the above decisions of this Court, it is clear that the
provisions of the Evidence Act in terms do not apply to the proceedings under
Section 10 of the Industrial
Disputes Act. However, applying general principles and on reading the
aforesaid judgments, we find that this Court, has repeatedly taken the view
that the burden of proof is on the claimant to show that he had worked for 240
days in a given year. This burden is discharged only upon the workman stepping
up in the witness box. This burden is discharged upon the workman adducing
cogent evidence, both oral and documentary. In cases of termination of services
of daily-waged earners, there will be no letter of appointment of termination.
There will also be no receipt of proof of payment. Thus in most cases, the
workman (the claimant) can only call upon the employer to produce before the
court the nominal muster roll for the given period, the letter of appointment
of termination, if any, the wage register, the attendance register, etc.
Drawing of adverse inference ultimately would depend thereafter on the facts of
each case. The above decisions however make it clear that mere affidavits or
self-serving statements made by the claimant workman will not suffice in the
matter of discharge of the burden placed by law on the workman to prove that he
had worked for 240 days in a given year. The above judgments further laid down
that mere non- production of muster rolls per se without any plea of
suppression by the claimant workman will not be the ground for the Tribunal to
draw an adverse inference against the management.
Lastly, the above judgments lay down the basic principle, namely, that the
High Court under Article 226 of the Constitution will not interfere with
concurrent findings of fact recorded by the Labour Court unless they are
perverse. This exercise will depend upon the facts of each case."
Mr. Viswanathan submitted that in these cases, the workmen had discharged
their initial onus by producing whatever documents were in their custody. The
onus had thereafter shifted to the petitioner when the workmen asked for
production of Attendance Registers and the Muster Rolls from 1991 onwards. On
the failure of the petitioner to produce the said documents, the High Court had
rightly drawn an adverse presumption.
Mr. Viswanathan then urged that in appropriate cases, the High Court in Writ
Jurisdiction could interfere with the findings of fact of the courts below as
had been held by this Court in the case of Trambak Rubber Industries Ltd. vs.
Nashik Workers Union And Ors., reported in (2003) 6 SCC 416. In any event,
the powers of judicial review of the High Court under Article 227 are very wide
and it empowered the High Court to ensure that the courts and tribunals,
inferior to the High Court, discharged their duties and obligations.
Mr. Viswanathan urged that the workmen had produced whatever documents were
in their possession, such as, attendance cards, wage slips, bonus slips,
provident fund deduction slips from 1991 onwards and since other relevant
documents such as attendance registers and muster rolls were with the
petitioners, the workmen filed an application for summoning the said documents
which were, not however, produced by the petitioner on account whereof the High
Court was compelled to draw an adverse presumption in terms of Section 114,
Illustration (g) of the Evidence Act.
Mr. Viswanathan submitted that while the Tribunal had failed to notice the
difference in the definition of the expression "continuous service"
in Section 6 N of the U.P. Act as against its definition in Section 25 B in the
Central Act, the High Court had correctly interpreted the same in the judgment
impugned in these proceedings.
Mr. Viswanathan submitted that no case had been made out on behalf of the
petitioner to interfere with the findings of the High Court and the directions
ultimately given therein to reinstate the respondents-workmen and to pay them
half their back wages with effect from 1995 when their services were illegally
Having carefully considered the submissions made on behalf of the respective
parties and the statutory provisions, we are of the view that a decision in
this matter will depend on the understanding of the expression "continuous
as used in Section 6 N read with Section 2 (g) of the U.P. Act as against
its usage in Section 25 B (2) (a) (ii) of the Central Act. In order to
appreciate the difference between the two provisions, Sections 6N and 2(g) of
the U.P. Act and Section 25 B 2 (a) (ii ) of the Central Act are reproduced
hereinbelow:- "6-N. Conditions precedent to retrenchment of workmen.-- No
workman employed in any industry who has been in continuous service for not
less than one year under an employer shall be retrenched by that employer until
(a) the workman has been given one month's notice in writing indicating the
reasons for retrenchment and the period of notice has expired or the workman
has been paid in lieu of such notice wages for the period of notice:
Provided that no such notice shall be necessary if the retrenchment is under
an agreement which specifies a date for the termination of service;
(b) the workman has been paid, at the time of retrenchment, compensation
which shall be equivalent to fifteen days' average pay for every completed year
of service or any part thereof in excess of six months, and (c) notice in the
prescribed manner is served on the State Government.
2g. 'Continuous service' means uninterrupted services, and includes service
which may be interrupted merely on account of sickness or authorized leave or
an accident or a strike which is not illegal, or a lock-out or a cessation of
work which is not due to any fault on the part of the workman, and a workman,
who during a period of twelve calendar months has actually worked in an
industry for not less than two hundred and forty days shall be deemed to have
completed one year of continuous service in the industry.
Explanation.In computing the number of days on which a workman has actually
worked in an industry, the days on which
(i) he has been laid off under the
agreement or as permitted by standing order made under the Industrial
Employment (Standing Orders) Act, 1946, or under this Act or under any other law
applicable to the industrial establishment, the largest number of days during
which he has been so laid off being taken into account for the purposes of this
(ii) he has been on leave with full
wages, earned in the previous year, and
(iii) in the case of a female, she
has been on maternity leave; so however that the total period of such maternity
leave shall not exceed twelve weeks, shall be included;
Definition of continuous service.
25B. For the purposes of this Chapter,- (2) Where a workman is not in
continuous service within the meaning of clause (1) for a period of one year or
six months, he shall be deemed to be in continuous service under an employer
(a) for a period of one year, if the workman, during a period of twelve
calendar months preceding the date with reference to which calculation is to be
made, has actually worked under the employer for not less than (ii) two hundred
and forty days, in any other case;"
As pointed out by Mr. Viswanthan, the exclusion of the word
"preceding" from Section 2 (g) of the U.P. Act indicates that a
workman in order to be in continuous service may have worked continuously for a
period of 240 days in any calendar year during his period of service. In fact,
such an interpretation has already been given by this Court in the case of U.P.
Drugs and Pharmaceuticals Company Ltd.
(supra). The case made out by the respondents before the Tribunal was also
on the same lines in the Adjudication cases filed before the labour court,
where the respondents had made out a case that they had never worked as
temporary hands but had worked continuously from 26th February, 1991 to 31st
January, 1995 without break.
In the light of the aforesaid case made out by the respondents, the Tribunal
was persuaded on behalf of the petitioner herein to decide the case of the
workmen on the basis of the materials produced by the petitioner for the year
preceding the date of termination of their services from which it was shown
that the workmen had not completed 240 days of continuous service in the said
The said approach, in our view, was erroneous in view of the decision of
this Court in the case of U.P. Drugs and Pharmaceuticals Company Ltd. (supra).
The petitioner had wrongly described the documents relating to attendance for
the years 1991 onwards as far as the respondents are concerned, as being
irrelevant and the Tribunal has also accepted the said reasoning. Consequently,
instead of drawing an adverse presumption for non-production of the said
records, the Tribunal accepted the contention of the petitioner that the
workmen had not worked for more than 240 days in the year preceding the date of
their termination nor had the workmen filed any proof to show otherwise.
In our view, the High Court adopted the correct approach while deciding the
controversy between the parties upon a correct understanding of the law as
contained in Section 6 N read with Section 2 (g) of the U.P. Act which is
applicable to these petitions.
Having correctly interpreted the provisions of Section 6 N of the U.P. Act,
the High Court rightly drew an adverse presumption for non-production of the
Attendance Registers and the Muster Rolls for the years 1991 onwards. The best
evidence having been withheld, the High Court was entitled to draw such adverse
inference. The views expressed by this Court on the question of burden of proof
in Range Forest Officer's case (supra) were watered down by the subsequent
decision in R.M. Yellatty's case (supra) and in our view the workmen had
discharged their initial onus by production of the documents in their
On the question of judicial review, the submissions made by Mr. Viswanathan
has force and we are inclined to accept the same.
In view of what has been indicated hereinabove, we are satisfied that no
interference is called for with the judgment and directions given by the High
Court which had been impugned in these petitions and the special leave
petitions are accordingly dismissed. Interim order dated 16th August, 2005, stands vacated.
There will be no order as to costs.
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