Shanghai Banking Corp.Ltd. Vs. Govt. of India & ANR.  INSC 552 (18
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.1718 OF 2009 (Arising out
of SLP(C) No. 29419 of 2008) Hongkong & Shanghai Banking Corp. Ltd. ....
Appellant Versus Government of India & Anr. .... Respondents
V.S. SIRPURKAR, J.
respondent No. 2 herein Mrs. Manju Saxena was the employee of the
appellant-Hongkong & Shanghai Banking Corporation Ltd.
`the bank' for short). According to the appellant, she drew a salary of
Rs.58,330/- per month with a total annual remuneration of Rs.7,32,736/-. In
May, 2005, the Bank reviewed its working norms, staff structure and other
relevant issues governing its operations and it was decided that the various
posts and positions held by the staff were to be 2 discontinued. One such post
to be discontinued was held by the second respondent. A severance package
and/or alternate employment to all such persons whose posts were to be
discontinued were offered. Accordingly such proposal was made to the second respondent
also, but she declined to accept the package.
01.10.2005 her services were terminated after paying her six months' salary as
compensation in lieu of notice period as provided in the contract of employment
and compensation equivalent to 15 days' salary for each completed year of
service amounting to Rs.8,17,071/-. This sum was allegedly accepted by the
a dispute was raised regarding this termination and hence the Government of
India, the first respondent herein referred the dispute to the Central
Government Industrial Tribunal (CGIT). The reference was as under:
action of the Chief Executive, HSBC, India Area Management Office, 52/60,
Mahatma Gandhi Road, P.O.128, Mumbai-400 001, in terminating the services of
Mrs Manju Saxena, Staff Officer w.e.f. 01.10.2005 without giving her full
terminal benefits is just, valid and legal? If not, to what benefits the
workman is entitled for and what directions are necessary in the matter."
the second respondent, by her various applications sought for interim relief
along with her pleadings before the Industrial Tribunal (hereinafter called
`Tribunal'). The application came to be allowed and vide order dated
30.06.2006, the Tribunal directed the appellant-Bank to pay a sum of
Rs.30,000/- per month to the claimant regularly till the disposal of the said
case. This was to be treated as an interim award.
appellant Bank challenged the said award by way of a Writ Petition No.
12606/2006 wherein the learned Single Judge of the Delhi High Court stayed the
interim order till further orders. The learned Single Judge was pleased to
direct vide his order dated 15.12.2006 that the second respondent should be
paid a sum of Rs.25,000/- towards the litigation expenses. It was also ordered
that the proceedings before the Tribunal would continue, however, final award
would not be passed. This order dated 15.12.2006 was, of course, an interim
order. This order was confirmed by the Division Bench in LPA No.33/207 by order
08.02.2007 the second respondent filed an application under Section 17-B of the
Industrial Dispute Act. On 07.09.2007 a letters patent appeal No.1194/2007
challenging the order of the learned Single Judge restraining the Tribunal from
pronouncing the award pending the disposal of the writ petition was disposed
of. The matter thus was pending before the learned Single Judge when the order
dated 07.09.2007 disposing of the letters patent appeal No.1194/2007 came up before
this Court by way of a 4 special leave petition. This Court dismissed the same
on 07.03.2008 and directed the High Court to dispose of the Writ Petition on
merits and in accordance with law preferably within three months from the date
of communication of the order.
the meantime, the appellant also filed the rejoinder affidavit to the counter
filed by the second respondent. On 23.05.20008, the application under Section
17-B of the Industrial Dispute Act was decided by the learned Single Judge. In
that order, no relief was granted under Section 17-B. On 24.09.2008, the Writ
Petition No.12602/2006 was also disposed of. It was held that the reference
could not be challenged at that stage of the proceedings when in fact the
proceedings under reference were pending final adjudication.
learned Single Judge, however, upheld the interim industrial award stating that
there was no infirmity in the interim award of the Industrial Adjudicator which
directed the appellant to pay Rs.30,000/- per month to the second respondent
regularly till the disposal of the industrial dispute. The said order was
challenged before the Division Bench in LPA No.684/2008 which came to be
disposed of by the impugned order.
the impugned order the Division Bench observed in paragraph 5 as under:
"We are informed
that the case before the Tribunal is at the stage of arguments. We request the
Tribunal to pronounce its final order in the matter within a period of six
weeks from 5 today, uninfluenced by any observation on merits that may have
been made in the impugned judgment dated 24th September, 2008, passed by the
learned Single Judge or in the order dated 30.06.2006 of the Tribunal."
The Division Bench
however dismissed the matter as also other pending applications. It is against
this that the present appeal has been filed.
senior counsel Shri Ashok H. Desai urged before us that he had no difficulty
with the direction of the Division Bench to the Tribunal for disposing of the
matter. He, however, raised a serious dispute regarding the direction passed by
the Tribunal by way of an interim award whereby a direction was given to pay
Rs.30,000/- per month to the second respondent. The learned senior counsel also
pointed out that an employee earning Rs.58,330/- per month could not be called
a `workman' within the definition of the term in Industrial Disputes Act, 1947.
The learned senior counsel further pointed out that as per the contract of service
the second respondent was already paid full compensation amounting to almost
Rs.9 lakhs which she had accepted without demur and, thus, there was no
justification in passing an interim award directing payment of Rs.30,000/- per
month to her. Learned counsel also argued on merits that the learned Single
Judge erred in holding that the Bank could not question the propriety of the
Reference made by the first respondent. As against this Smt. Manju Saxena who
appeared in person argued that there would be no 6 question of denying the
reinstatement to her, particularly, in view of the interim award passed and if
the Bank was not in a position to reinstate her, the Bank was bound to pay
Rs.30,000/- per month as ordered by the Tribunal in lieu of reinstatement. Smt.
Saxena further argued that the Bank was deliberately depriving her of legal
a careful consideration of the contentions raised herein we are of the clear
opinion that it will be futile at this stage to go into the question regarding
the status of the employee as the same is pending before the Tribunal and the
trial in the Tribunal is complete. We would not therefore go, at this stage,
into the question as to whether the learned Single Judge and the Division Bench
were right in continuing the proceedings before the Tribunal. We must note, at
this juncture, that the appellant Bank is taking part in the trial before the
Tribunal. Everything would, therefore, depend upon the verdict of the Tribunal.
The question is, however, of the interim award and the directions given
do not see any reason to stay the interim award, particularly because of the
detailed reasons given in support thereof by the Tribunal.
senior counsel expressed his apprehension that in case the verdict goes against
the second respondent regarding her status as a workman then it would be very
difficult for the appellant to recover the amounts paid by way of the interim
award. There can be no dispute that the payment of Rs.30,000/- per month as
ordered by the Tribunal would amount to almost Rs.9 lakhs. The apprehension of
the learned counsel is 7 not altogether unjustified. However, the fact remains
that in the interim award itself, the Tribunal has secured the interests of the
appellant by ordering that in case the final award goes against the second
respondent still the amount paid to her by way of interim award could be
adjusted against the retiral benefits which she is entitled to receive. We have
specifically put this to the learned senior counsel Shri Ashok H. Desai,
appearing on behalf of the appellant as to how much amount would be receiveable
by the respondent by way of her retiral benefits. The learned counsel very
frankly put the whole account before us.
the overall situation, we are of the opinion that the amount of Rs.8 lakhs
should be payable to the second respondent by way of arrears. She would also
continue to get the amount of Rs.30,000/- per month till the award is finally
decided by the Tribunal. This amount shall be adjustable against the amount
receivable by her by way of retiral benefits in case the award goes against
her. We also request the Tribunal to dispose of the proceedings, if not already
disposed of by now, within two months from the date when the orders reach the
Tribunal. We make it clear that we have not expressed anything in respect of
the merits of the award or the status of the second respondent. The Tribunal
shall decide the question regarding status on merits without being influenced
by this judgment or for that matter any other judgment including the interim
these directions we dispose of this appeal. The payment shall be made within
six weeks from the date of judgment.
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