CIVIL APPEAL NO 1817 2007 [Arising out of S.L.P. (C) No. 17917 of 2005]
S.B. Sinha ,
State of Madhya
Pradesh runs an establishment in Delhi known as Madhya Pradesh Bhawan.
Respondent was appointed on temporary basis from time to time with
breaks in services. He worked for the period 13.12.1991 to 1.3.1994.
After his services were terminated, an industrial dispute was raised.
The said dispute was referred for its determination before the
Industrial Tribunal. The Industrial Tribunal by an Award dated
26.7.2002, while holding that in terminating the services of the
respondents the appellant has failed to comply with the statutory
requirements contained in Section 25 F of the Industrial Disputes Act,
awarded only retrenchment compensation alongwith notice pay together
with interest @ 9% per annum. Validity of the said Award was not
questioned by the appellant. Respondent, however, filed a Writ Petition
thereagainst. By a Judgment and Order dated 24.2.2005 and 15.4.2005, a
learned Single Judge of the Delhi High Court allowed the said Writ
Petition directing re-instatement of the respondent with full back
wages. An intra-court appeal preferred thereagainst has been dismissed
by a Division Bench of the said Court by reason of the impugned
Mr. Vikas Singh,
learned Additional Solicitor General appearing on behalf of the
appellant would submit that Madhya Pradesh Bhawan being merely a Circuit
House of the Government of Madhya Pradesh, is not an "Industry" within
the meaning of Section 2(j) of the Industrial Disputes Act. Learned
counsel urged that in that view of the matter, it was not a fit case
where a direction of re-instatement with full back wages should have
Mr. Sujoy Ghosh,
learned counsel appearing on behalf of the respondent, on the other
hand, would submit that although the question as to whether sovereign
functions of the State would come within the purview of the definition
of "Industry" is pending for consideration before the Seven Judges'
Bench having been referred to by a Constitution Bench in State of U.P.
v Jai Bir Singh [(2005) 5 SCC 1], but so long the existing law is
not set aside, Madhya Pradesh Bhawan wherein even the private guests are
also entertained would bring the establishment within the purview of
"Industry". In any event, the industrial court having arrived at a
finding to that effect in its Award dated 26.7.2002 which having not
been questioned, the appellant cannot be permitted to raise the same
before this Court. It was contended that artificial breaks after 89 days
of service being not bonafide, the termination of the services of a
workman would not come within the exceptions envisaged under Section
2(oo) (bb) of the Act. It was urged that Industrial Disputes Act does
not make any distinction between a daily wager and the permanent
employee, in view of the definition of "workman" as contained in Section
2(s) thereof. The High Court, therefore, cannot be said to have
committed any illegality in directing the re-instatement of the
respondent with full back wages as admittedly the provisions of Section
25 F of the Industrial Disputes Act had not been complied with.
The question as to
whether the activities of the Appellant satisfy the tests laid down in
the statutory definition of "Industry" as contained in Section 2(j) of
the Industrial Disputes Act or not, in our opinion need not be gone into
in this case. Industrial Court opined that it was an Industry. The
legality of the Award of the Industrial Court was not questioned. So far
as the appellant is concerned, it, thus, attained finality. It,
therefore, in our opinion cannot now be permitted to turn round and
contend that its Delhi establishment does not come within the purview of
the definition of "Industry".
however, which arises for consideration is as to whether in a situation
of this nature, the learned Single Judge and consequently the Division
Bench of the Delhi High Court should have directed re-instatement of the
respondent with full back wages. Whereas at one point of time, such a
relief used to be automatically granted, but keeping in view several
other factors and in particular the doctrine of public employment and
involvement of the public money, a change in the said trend is now found
in the recent decisions of this Court. This Court in a large number of
decisions in the matter of grant of relief of the kind distinguished
between a daily wager who does not hold a post and a permanent employee.
It may be that the definition of "workman" as contained in Section 2(s)
of the Act is wide and takes within its embrage all categories of
workmen specified therein, but the same would not mean that even for the
purpose of grant of relief in an industrial dispute referred for
adjudication, application for constitutional scheme of equality
adumbrated under Articles 14 and 16 of the Constitution of India, in the
light of a decision of a Constitution Bench of this Court in Secretary,
State of Karnataka and Others v Umadevi (3) and Others [(2006) 4
SCC 1], and other relevant factors pointed out by the Court in a catena
of decisions shall not be taken into consideration.
The nature of
appointment, whether there existed any sanctioned post or whether the
officer concerned had any authority to make appointment are relevant
See M.P. Housing
Board and Another v Manoj Shrivastava [(2006) 2 SCC 702], State of M.P.
and Others v Arjunlal Rajak [(2006) 2 SCC 711] and M.P. State Agro
Industries Development Corpn. Ltd and Another v S.C. Pandey [(2006) 2
Our attention has
been drawn to a recent decision of this Court in Jasbir Singh v.
Punjab & Sind Bank and Others reported in [(2007) 1 SCC 566] by the
learned counsel appearing on behalf of the respondent. We do not see as
to how the said decision is applicable to the fact of the present case.
In Jasbir Singh
(supra), the Order of termination was passed on the ground of
misconduct. The said question was also the subject matter of a suit,
wherein the Civil Court had held that the appellant therein was not
guilty of the misconduct. In that context only, the question in regard
to the relief granted by the Court was considered in the light of the
relief which may be granted by the Industrial Court under Section 11A of
the Industrial Disputes Act stating;
"It was, however,
urged that no back wages should be directed to be paid. Reliance in this
behalf has been placed on U.P. State Brassware Corpn. Ltd. v. Uday
Narain Pandey. In that case, this Court was dealing with a power of
the Industrial Courts under Section 11-A of the Industrial Disputes Act.
Therein, as the establishment was closed, the question of reinstatement
of the workman did not arise. Still then, 25% back wages were directed
to be paid as also the compensation payable in terms of Section 6-N of
the U.P. Industrial Disputes Act.
The judgments of
both the civil court and the criminal court established that the
appellant was treated very unfairly and unreasonably. For all intent and
purport, a criminal case was foisted upon him. A confession, according
to learned Chief Judicial Magistrate, was extracted from him by the bank
officers in a very cruel manner. It is, therefore, not a case where back
wages should be denied. The respondent Bank has tried to proceed against
the appellant in both in civil proceedings as well as in criminal
proceedings and at both the independent forums, it failed."
We may notice that
recently in Muir Mills Unit of NTC (U.P.) Ltd. v. Swayam Prakash
Srivastava and Another [(2007) 1 SCC 491], a Bench of this Court
"With regard to the
contention of the respondents that in the present fact scenario
retrenchment is bad under law as conditions under Section 6-N, which
talks about a reasonable notice to be served on an employee before
his/her retrenchment, is not complied with; we are of the view that even
under Section 6-N the proviso states that "no such notice shall be
necessary if the retrenchment is under an agreement which specifies a
date for the termination of service". In the present case on the perusal
of the appointment letter it is clear that no such notice needs to be
issued to Respondent No. 1.
The respondents had
referred to many cases with regard to back wages to be paid to the
retrenched workman. The learned counsel cited a string of decisions of
this Court in support of this contention. We are however not addressing
this plea of the respondents as we have already observed that Respondent
1 is not a workman under the Industrial Disputes Act, 1947 and the U.P.
ID Act, 1947 and also that the retrenchment was not illegal and
therefore the question of back wages does not arise."
We may also notice
that in Uttranchal Forest Development Corporation v M.C. Joshi
[2007 (3) SCALE 545], this Court held;
"Although according to the learned counsel appearing on behalf of the
appellant the Labour Court and the High Court committed an error in
arriving at a finding that in terminating the services of the
respondent, the provisions of Section 6N of the UP Industrial Disputes
Act were contravened, we will proceed on the basis that the said finding
is correct. The question, however, would be as to whether in a situation
of this nature, relief of reinstatement in services should have been
granted. It is now well-settled by reason of a catena of decisions of
this Court that, the relief of reinstatement with full back wages would
not be granted automatically only because it would be lawful to do so.
For the said purpose, several factors are required to be taken into
consideration, one of them being as to whether such an appointment had
been made in terms of the statutory rules. Delay in raising an
industrial dispute is also a relevant fact.
In Haryana State
Electronics Development Corporation v Mamni [AIR 2006 SC 2427], this
Court directed payment of compensation. Similar orders were passed in
North-Eastern Karnataka Rt. Corporation v. Ashappa [(2006) 5 SCC
137] and U.P. State Road Transport Corporation v. Man Singh
[(2006) 7 SCC 752]
In Man Singh (supra)
it was held :-
"7. The respondent admittedly raised a dispute in 1986, i.e. after a
period of about 12 years, it may be true that in an appropriate case, as
has been done by the Labour Court, delay in raising the dispute would
have resulted in rejection of his claim for back wages for the period
during which the workman remains absent as has been held by this Court
in Gurmail Singh vs. Principal, Govt. College of Education. But the
discretionary relief, in our opinion, must be granted upon taking into
consideration all attending circumstances. The appellant is a statutory
corporation Keeping in view the fact that the respondent was appointed
on a temporary basis, it was unlikely that he remained unemployed for
such a long time. In any event, it would be wholly unjust at this
distance of time. i.e. after a period of more than 30 years, to direct
reinstatement of the respondent in service. Unfortunately, the Labour
Court or the High Court did not consider these aspects of the matter.
8. Keeping in view
the particular facts and circumstances of this case, we are of the
opinion that instead and in place of the direction for reinstatement of
the respondent together with back wages from 1986, interest of justice
would be subserved if the appellant is directed to pay a sum of Rs.
50,000 to him. Similar orders, we may place on record, have been passed
by this Court in State of Rajasthan v. Ghyan Chand, State of MP vs.
Arjunlal Rajak, Nagar Mahapalika (now Municipal Corporation) v.
State of U.P., and Haryana State Electronics Development Corporation
Ltd. v. Mamni."
It was further held
"The legal position has since undergone a change in the light of a
Constitution Bench decision of this Court in Secretary, State of
Karnataka & Ors. vs. Uma Devi (3) & Ors. [(2006) 4 SCC 1] wherein
this Court held that 'State' within the meaning of Article 12 of the
Constitution of India is under a constitutional obligation to comply
with the provisions contained in Articles 14 and 16 of the Constitution
In this case, the
Industrial Court exercised its discretionary jurisdiction under Section
11A of the Industrial Disputes Act. It merely directed the amount of
compensation to which the respondent was entitled to, had the provisions
of Section 25 F been complied with should be sufficient to meet the ends
of justice. We are not suggesting that the High Court could not
interfere with the said order, but the discretionary jurisdiction
exercised by the Industrial Court, in our opinion, should have been
taken into consideration for determination of the question as to what
relief should be granted in the peculiar facts and circumstances of this
case. Each case is required to be dealt with in the fact situation
We, therefore, are
of the opinion that keeping in view the peculiar facts and circumstances
of this case and particularly in view of the fact that the High Court
had directed re-instatement with full back wages, we are of the opinion
that interest of justice would be subserved if appellant herein be
directed to pay a sum of Rs. 75,000/- by way of compensation to the
respondent. This appeal is allowed to the aforementioned extent.
However, in the
facts and circumstances of this case, there shall be no order as to
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