Rajasthan Lalit Kala
Academy Vs. Radhey Shyam [2008] INSC 1099 (11 July 2008)
Judgment
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 4331 OF 2008 [Arising
out of S.L.P. (C) No. 6853 of 2006] RAJASTHAN LALIT KALA ACADEMY -- APPELLANT
(S) VERSUS
D.K. JAIN, J.:
1.
Leave
granted.
2.
The
appellant-management has challenged in this appeal the judgment and order dated
1st December, 2005, passed by the High Court of Judicature for Rajasthan at
Jaipur in D.B.
Special Appeal (Writ)
No. 279 of 2001, dismissing the intra- court appeal against the order of a
learned Single Judge in 1 S.B. Civil Writ Petition No.1895 of 1998. The learned
Single Judge had affirmed the award of the Labour Court in L.C.R. No. 348 of
1985, directing reinstatement of the respondent- workman with continuity of
service and 25% back-wages from the date of termination of his services to the
date of award.
3.
A
few material facts leading to these proceedings, are as follows:
The respondent was
appointed on 7th June, 1980 on a monthly salary of Rs.300/- to do the work of a
Junior Clerk. On 4th April, 1981 his services were terminated. On an industrial
dispute being raised, the Industrial Tribunal, Jaipur, by an award dated 24th
September, 1983, set aside the order of termination and directed reinstatement
of the respondent with effect from 24th September, 1983 with 50% back-wages.
The respondent claims to have submitted his joining report on the very next
date of award. The award was published under Section 17 of the Industrial
Disputes Act, 1947 (for short `the Act') on 17th April, 1984. The respondent
again submitted his joining report to the Secretary of the appellant but was
not taken back on duty.
4.
The
validity of the award was questioned by preferring a Civil Writ Petition
No.1317 of 1984. During the pendency of the writ petition, the High Court
granted stay of the direction in regard to payment of back-wages. However,
direction regarding reinstatement of the respondent was not stayed. Yet the
respondent was not taken back on duty. Ultimately, the writ petition was
dismissed.
5.
Since
the appellant did not permit the respondent to join duty, the respondent took
recourse to proceedings under Section 29 of the Act against the appellant.
According to the respondent, he again reported for duty on 17th November, 1984,
but the appellant did not permit him to join. Instead, vide order dated 31st
January, 1985, the appellant terminated the services of the respondent,
treating him to be in service with effect from 17th November, 1984.
6.
The
respondent raised an industrial dispute. The dispute was referred to the Labour
Court for adjudication, and was registered as L.C.R. No.348 of 1985. The
respondent also 3 filed an application under Section 33C (2) of the Act for
computation of wages for the period from 24th September, 1983 to 17th November,
1984 the same was registered as L.C.R. No. 438 of 1986.
7.
Before
the Labour Court, the stand of the appellant was that the respondent was
temporarily appointed on 7th June, 1980 for a period of three months to do the
work of gallery attendant; he had himself abandoned the work but rejoined
service pursuant to order in the writ petition and that his services were
terminated due to non requirement of his services, after complying with the
provisions of Section 25-F of the Act by paying an amount of Rs.1800/- by means
of a demand draft. The plea of the respondent, on the other hand, was that his
services were terminated without service of any notice, disclosing reasons for
his retrenchment nor any amount was paid to him in lieu of such notice.
8.
On
appraisal of evidence led by both the sides, the Labour Court, by award dated
26th April, 1997, came to the conclusion that the management had failed to
adduce any evidence in support of its plea that a demand draft in the 4 sum of
Rs.1800/- was given to the respondent in lieu of notice in terms of Section
25-F of the Act. Thus, the Labour Court found that in terminating the services
of the respondent, the appellant had failed to comply with the statutory
requirements and, therefore, order dated 31st January, 1985 was arbitrary and
illegal and had been passed in a mala fide manner in order to victimize the
respondent. Accordingly, the Labour Court directed reinstatement of the
respondent with continuity in service and payment of 25% back-wages from the
date of termination of services to the date of award. In the other application
for computation of wages (L.C.R. No. 438 of 1986), the Labour Court held that
the respondent was entitled to wages for the period from 4th September, 1983 to
17th November, 1984.
9.
The
award (in L.C.R. No. 348 of 1985) was challenged by the appellant by preferring
a writ petition in the Rajasthan High Court. However, Labour Court's award in
L.C.R. No.438 of 1986 was not challenged.
10.
10.The
learned single Judge as well as the Division Bench have dismissed the writ
petition and the appeal filed by the appellant against the award of the Labour
Court. That is how the appellant is before us.
11.
11.We
have heard learned counsel for the parties.
12.
Learned
counsel appearing on behalf of the appellant submitted that in the light of the
evidence on record, the Labour Court as well as the High Court have committed
an error in arriving at a finding that in terminating the services of the
respondent, the appellant has contravened the provision of Section 25-F of the
Act. It was contended that the courts below ignored cogent and credible
evidence which suggested that a demand draft in the sum of Rs.1800/- was issued
to the respondent and, therefore, the finding regarding non compliance with the
provision of Section 25-F is erroneous and perverse. Learned counsel also urged
that since the respondent had not rendered any services, the courts below erred
in awarding back-wages to the respondent and that too on the basis of salary 6
equivalent to that of junior employee. Lastly, it was urged that assuming that
the appellant had failed to comply with the provision of Section 25-F of the
Act but having regard to the fact that the services of the respondent had been
terminated over two decades ago, it would not be proper to reinstate the
respondent with back-wages and instead some reasonable amount of compensation
could be awarded to him in lieu of his reinstatement. In support of the
proposition that award of back-wages is not necessary in every case where the
termination of service is held to be violative of Section 25-F of the Act,
reliance is placed on a decision of this Court in General Manager, Haryana
Union of India & Anr.2; Haryana State Electronics sum amounts had been
awarded in lieu of reinstatement. 1 (2005) 5 SCC 591 2 (2005) 9 SCC 171 3 (2006)
9 SCC 434 4 (2007) 9 SCC 748 7
13.
Per
contra, Mr. S.K. Keshote, learned senior counsel appearing on behalf of the
respondent, submitted that on the basis of the material on record, all the
courts have returned a finding that the appellant had not only failed to pay to
the respondent any amount in lieu of notice in terms of clause (a) of Section
25-F and compensation in terms of clause (b) thereof, they had also committed
unfair labour practice by victimizing the respondent. The submission was that
these being pure findings of fact, this Court should decline to interfere with
the award of the Labour Court, affirmed by the High Court. Learned counsel
asserted that having regard to the conduct of the appellant, where they
deliberately did not comply with the first award despite the fact that the High
Court had declined to stay the direction with regard to reinstatement, no fault
could be found with the direction of the Labour Court regarding reinstatement
of the respondent with only 25% back-wages.
14.
It
is trite that in the event of retrenchment of a workman, employed in any
industry, continuously for not less than one year under an employer, compliance
with the 8 provisions of Section 25-F of the Act, in particular clauses (a) and
(b) thereof is mandatory. A bare reading of Section 25-F of the Act shows that
retrenchment within the meaning of Section 2 (oo) of the Act, which admittedly
is the case here, must satisfy the following conditions:
i.
the
workman is given one month's notice - (a) in writing (b) indicating the reasons
for retrenchment;
ii.
(ii)the
retrenchment must take effect after the expiry of the period of notice. i.e.,
one month or else, the workman should be paid in lieu of such notice, wages for
the period of the notice:
iii.
(iii)at
the time of retrenchment, the workman has been paid compensation, equivalent to
fifteen days' average pay for every completed year of continuous service or any
part thereof in excess of six months; and
iv.
(iv)The
notice in the prescribed manner is served on the appropriate government or such
authority as may be specified.
15.
As
noted above, the specific plea of the appellant- management before the Labour
Court was that services of the respondent were terminated on 31st January, 1985
after payment of Rs.1800/- by demand draft, in compliance with the provision of
Section 25-F of the Act. However, in the award, the Labour Court has observed
that the management has not adduced any such evidence wherefrom a conclusion
could be drawn that the workman had received the said amount of Rs.1800/-. It
is pointed out that neither any receipt, acknowledging receipt of draft was
produced nor the workman was cross-examined on this aspect. Even the
computation of compensation allegedly paid was not correct. The labour court,
thus, held that payment of compensation in accordance with Section 25-F of the
Act was not proved. In the light of the pleadings and undisputed documents
available on record, we are convinced that the finding of the Labour Court to
the effect that the appellant has failed to adduce any evidence in support of
their plea that an amount of Rs.1800/- had been paid to the respondent, does
not suffer from any perversity 10 as pleaded by learned counsel for the
appellant. Thus, it cannot be said that the Labour Court or the High Court has
committed any illegality, warranting interference with the said concurrent
finding of fact. In that view of the matter, we deem it unnecessary to examine
the issue whether termination of respondent's services was by way of
victimisation and thus, the appellant was guilty of unfair labour practice, as
held by the Labour Court.
16.
The
question which now survives for consideration is whether on facts in hand,
relief of reinstatement with continuity of service and 25% back-wages should
have been granted to the respondent?
17.
Once
the termination of service of an employee is held to be illegal, the relief of
reinstatement is ordinarily available to the employee. But the relief of
reinstatement with full back-wages need not be granted automatically in every case
where the Labour Court/Industrial Tribunal records the finding that the
termination of services of a workman was in violation of the provisions of the
Act. For this purpose, 11 several factors, like the manner and method of
selection;
nature of appointment--ad
hoc, daily-wage, temporary or permanent etc., period for which the workman had
worked and the delay in raising industrial dispute, are required to be taken
into consideration.
18.
On
this aspect, in General Manager, Haryana Roadways case (supra), a three-Judge
Bench of this Court has observed thus:
"There is no
rule of thumb that in every case where the Industrial Tribunal gives a finding
that the termination of service was in violation of Section 25-F of the Act,
entire back wages should be awarded. A host of factors like the manner and
method of selection and appointment, i.e., whether after proper advertisement
of the vacancy or inviting applications from the employment exchange, nature of
appointment, namely, whether ad hoc, short term, daily wage, temporary or
permanent in character, any special qualification required for the job and the
like should be weighed and balanced in taking a decision regarding award of
back wages.
One of the important
factors, which has to be taken into consideration, is the length of service,
which the workman had rendered with the employer. If the workman has rendered a
considerable 12 period of service and his services are wrongfully terminated,
he may be awarded full or partial back wages keeping in view the fact that at
his age and the qualification possessed by him he may not be in a position to
get another employment. However, where the total length of service rendered by
a workman is very small, the award of back wages for the complete period, i.e.,
from the date of termination till the date of the award, which our experience
shows is often quite large, would be wholly inappropriate.
Another important
factor, which requires to be taken into consideration is the nature of
employment. A regular service of permanent character cannot be compared to
short or intermittent daily wage employment though it may be for 240 days in a
calendar year."
19.
It
appears to us that in the present case there has not been due application of
mind either by the Labour Court or the High Court on the question of
reinstatement and payment of 25% back-wages. The only ground on which
reinstatement and continuity of service has been ordered is because the order
of termination has been held to be unlawful. Similarly, 25% back-wages have
been awarded for the reason that the services of the petitioner were terminated
with immediate effect but no specific reason as 13
such has been
assigned for the award of the said back- wages. In our opinion, though,
illegality of the order of termination is one of the prime considerations for
determining the question and quantum of back-wages, but it cannot be the sole
criterion therefor. A host of other factors, a few enumerated above, are
required to be taken into consideration before issuing directions in that
behalf.
Therefore, the award
of the Labour Court to that extent cannot be sustained. However, we feel that
at this distant time, it would not be fair to the respondent-workman to remit
the matter back to the Labour Court or the High Court for fresh consideration
of the issue. In the light of the observations referred to supra and having
regard to the nature and the period of services rendered by the respondent and
the fact that his services were terminated initially on 4th April, 1981 and
then on 31st January, 1985 and the vicissitudes of long-drawn litigation, the
respondent has undergone for over 27 years, interest of justice would be met if
instead and in place of direction for reinstatement and back-wages--a sum Rs.3
lakhs is directed to be paid to 14 the respondent by way of compensation. We
direct accordingly. The payment shall be made within eight weeks from today,
failing which it shall carry interest @ 9% per annum from the date of this
judgment till the date of actual payment. We may note that in the affidavit,
filed in response to the query raised by the Court on 29th April, 2008, it is
stated that if the present appeal is dismissed, the appellant would be liable
to pay to the respondent more than Rs.8 lakhs. It goes without saying that the
said amount of compensation is over and above the amount, the respondent is
entitled to receive in terms of award dated 24th September, 1983, which has
attained finality.
20.
20.Resultantly,
the appeal is allowed to the extent indicated above. However, in the facts and
circumstances of the case, there shall be no order as to costs.
................................................J.
(C. K. THAKKER)
.................................................J.
( D.K. JAIN)
NEW
DELHI;
JULY
11, 2008.
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