Punjab-Haryana High Court
Angrejo Devi vs Presiding Officer Industrial Tribunal ... on 13 November, 2014
Author: Rajiv Narain Raina
Bench: Rajiv Narain Raina
CWP No.14256 of 2012
-1-
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
CWP No.14256 of 2012
Date of Decision: 13.11.2014
Angrejo Devi ... Petitioner
Versus
The Presiding Officer, Industrial
Tribunal-cum-Labour Court,
Panipat and another ... Respondents
CORAM:- HON'BLE MR. JUSTICE RAJIV NARAIN RAINA
Present: Ms. Abha Rathore, Advocate,
for the petitioner.
Mr. Paul S.Saini, Advocate,
for respondent No.2.
1. To be referred to the Reporters or not? Yes.
2. Whether the judgment should be reported in the Digest? Yes.
RAJIV NARAIN RAINA, J.
The respondent-Delhi Public School, Panipat Refinery Township, Panipat is run from a building provided by the Panipat Refinery which is owned and managed by the Indian Oil Corporation Ltd (IOC). The school is established mostly to impart education to the children of employees of the Panipat Thermal Plant. Hithertofore, the housekeeping activities in the respondent school were managed on its own till the work involved was outsourced from April 01, 2005. It cannot be said that the integral activity of housekeeping was shut down since it continued in the hands of the IOC. Afterward, no person was engaged directly by the school to carry out its housekeeping activities. The petitioner who was employed by the school since April 01, 1998 became a victim of the new system introduced. She MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -2- used to be paid a monthly salary of Rs.2500/- while in service. She was disengaged from service on April 01, 2005 after seven years of continuous work. This gave rise to a dispute which was referred to the Presiding Officer, Labour Court, Panipat for adjudication.
What is urged by the respondent in defence of the award is that closure compensation under Section 25 FFF was offered to the petitioner vide cheque Ex.M1 but the same was refused by the workman. However, before the Labour Court, no direct evidence of closure was adduced on record by the management. It is argued that closure of a part of the activities of the school amounts to closure with all consequences arising therefrom under the Industrial Disputes Act, 1947 (the 'ID Act') In the written statement filed by the management before the Labour Court the defence taken in order to rebut the claim of the workman was that the school authorities had abandoned housekeeping work and since this type of work was stopped the workman was offered compensation but she did not collect the amount of compensation and by this act she had disentitled herself to the relief of reinstatement and back wages. In the demand notice under Section 2-A of the ID Act [treated as a statement of claim before the Labour Court] it was pleaded by the worker that she worked as a Sweeper from 1998 to 2005 and her services were terminated without notice or inquiry and without complying with the mandatory provisions of Section 25 [sic 25-F] of the Act as well as Sections 25-N and 25-G. In para.4 the workman asserted that she had completed 240 days in a calendar year. She was a member of the Provident Fund and was issued an Identity Card by the management. In reply to para.4 the management in MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -3- rebuttal pleaded that when the housekeeping activities were closed by the school management the worker was offered compensation in compliance with the provisions of Section 25-F of the Act and it was the worker who had deliberately and purposely not accepted the said amount of compensation and had instead served a demand notice on the school management. The amount was offered through cheque No.695572 dated April 12, 2006 for a sum of Rs.12,361/- drawn on State Bank of India, Panipat Branch (Ex.M-1) which was tendered by way of evidence through an application accompanying the written statement and, therefore, there was no violation of the provisions of Section 25-F of the Act.
If that is so then it is quite apparent from the date of retrenchment and offer of money by the management that the offer was not simultaneous but separated by a little under one year and thus was not legally acceptable as payment of compensation in terms of section 25-F of the ID Act and refusal by the worker to accept what was offered long after the termination of service was due compliance of the law. In the written statement, a plea was not taken that the payment offered was in terms of Section 25 FFF of the Act. As a matter of fact, Section 25 FFF is not pleaded in defence in the written statement. Section 25 FFF provides for compensation to workmen in case of closing down of undertakings. Where an undertaking is closed down for any reason whatsoever, every workman who has been in continuous service for not less than one year in that undertaking immediately before such closure shall, subject to the provisions of sub-section (2) of section 25 FFF, be entitled to notice and compensation in accordance with the provisions of Section 25F, as if the workman had been retrenched. The MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -4- proviso to Section 25 FFF provides that where the undertaking is closed down on account of unavoidable circumstances beyond the control of the employer, the compensation to be paid to the workman under Clause (b) of Section 25-F shall not exceed his average pay for three months. The written statement was filed on April 17, 2006 before the Labour Court. Section 25 FFF deals with closure of undertakings and not an integral part of cleaning and maintenance of movable or immovable property of the management since the petitioner was engaged in the activity of sweeping which activity was not shut down but continued in another form and character directly under IOC. This is not to say that outsourcing an activity is impermissible. After all the school was not closed down but one of its integral activities was closed down for accommodating the system of outsourcing human resources through the agency of contractors. Any termination brought about in such a situation would nevertheless amount to "retrenchment" within the meaning of Section 2(oo) of the ID Act be it whatever reason which compelled such a course to be adopted. If the defence under section 25 FFF was not taken in the written statement by the management then it is settled that what is not pleaded is not open to proof by adducing evidence. When the management admits categorically and without any ambiguity in para.4 of the written statement that they complied with the provisions of Section 25-F of the Act and offer thereunder was not accepted then payment of compensation was offered on April 12, 2006 while the retrenchment had been effected about a year before that on April 01, 2005. There was no contemporaneous compliance of Section 25-F (a) and (b) of the Act which are mandatory and non-compliance thereof renders the retrenchment of an MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -5- employee a nullity. The employee would then be assumed to have continued in employment as if her services were never terminated by reason of breach of mandatory procedure in section 25 F. For this proposition, the judgment of the Supreme Court in Anoop Sharma vs. Executive Engineer Public Health Division No-1, Panipat (Haryana), 2010(3) SCC 497 can be read with profit.
To examine the case from the standpoint of closure under section 25 FFF then it would be seen that if it had been a case of bona fide closure of an undertaking of severable part of it, then possibly the management could have contended that simultaneous compliance of the mandatory part of Section 25 FFF was not an essential ingredient to be satisfied simultaneously and payment could well be offered ex post facto and be legally sustainable. However, since the defence was not taken it cannot be permitted to be taken for the first time in writ proceedings in the written statement filed in defence of challenge to the award of the Labour Court. For this proposition, we can profitably refer to Harjinder Singh vs. Punjab State Warehousing Corporation, (2010) 3 SCC 192 in which the Supreme Court has laid down dicta for the writ court to refrain from opening and starting a de novo examination of issues not taken or pressed before the Court a quo and raised for the first time in writ jurisdiction.
In the circumstances, this Court would not embark upon a journey on any other consideration except what was in issue before the labour court, in the matter of grant of relief to the workman when the termination amounts to retrenchment within the meaning of Section 2(oo) of the Act. This is also not a case which could ever be brought within the fold of MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -6- Section 2(oo) (bb) of the Act in absence of a contract of employment or any stipulation that the engagement is limited by time or tenure.
The only moot issue that remains for consideration of this Court is whether the workman had put in continuous service for 12 calendar months preceding the date of retrenchment, closure or whatever you may call it. In the demand notice, the worker had categorically asserted in the opening line of para.4 that she had completed 240 days in the calendar year. In response to para.4 there was a general denial that its contents are incorrect and the averments are wrong. There is no specific averment in the statement of defence claim that the workman had not completed 240 days as required by law. It was only explained in para.4 that housekeeping activities were closed which led to the disengagement of the worker. It was further assured that the worker can always claim the amount of cheque dated April 12, 2006 for which reason the management says that there was no violation of Section 25-F. It is well settled that what is not specifically denied is admitted. In this factual scenario the question of completion of 240 days of continuous service ceased to be a triable issue by tacit admission in pleadings. When a fact asserted is not specifically denied no amount of evidence can be led to prove facts which are not in issue. The management did not amend its written statement and went to trial on it. The reliance of the management on case law which has weighed with the Labour Court was inappropriate to the adjudication on the question of completion of 240 days of continuous service. Those rulings were distinguishable. There can be no dispute that the burden is on the workman to prove as a jurisdictional fact that he had put in 240 days of continuous service as required by law. But if MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -7- the assertion of the worker is not denied in para.4 of the written statement then neither the question of burden nor onus was involved before the Labour Court which misdirected itself to deny relief to the claimant- petitioner. A reason cannot be found beyond the pleadings to non-suit a workman. The Labour Court has failed to appreciate the fine distinction between pleadings and evidence, admission and denial of facts and evidence based on issues. It is rudimentary that only facts-in-issue can be put to trial and the labour court is no exception to this rule. Though the Labour Court was not bound by strict rules of evidence or of procedure under the Civil Code or the evidence Act but is adjudication has to be based on the fundamental and cardinal principles underlining those acts which are universal in its application to Tribunals. No doubt the Labour Court can follow such procedure as it thinks fit but such procedure has to conform to the law and the rules of natural justice. It cannot also ignore statutory mandates and limitations placed in the Industrial Disputes Act, 1947 under which it is created.
Attention of this Court is drawn to the attendance register (Ex.M-
24) by an assertion that it was produced at the instance of the worker from a witness drawn from the management for the period April 2004 to March 2005 by summoning WW-2, an Upper Division Clerk in the school, but the witness during his cross-examination admitted that he has no record for the working days for which payment of contribution was deposited to the EPF. It also came through WW-3 who brought the attendance and payment records of the workman that did not show work for 240 days during the last 12 calendar months preceding April 01, 2005. What is to be noted is that the MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -8- management did not take the lead to rely on its evidence based on record then by its act of non-production of the attendance and payment records serious suspicion is cast that everything was not alright there.
Even though the management did not take any specific defence or stand before the labour court in writing with respect to the question of completion of 240 days of continuous service, probably obsessed with its plea of closure of housekeeping activity and the success such a defence plea might meet before this Court for the first time but still this Court has read the written statement filed by the management in response to the writ petition and especially at page 31 of the paper book where a chart is given of days actually worked by the petitioner during the months April 2004 to March 2005 totalling 229 days. No implicit faith can be placed on the figures as it is fraught with danger by the use of the word "actually worked"
which might exclude the possibility of counting out Sundays, rest days and Gazetted and local holidays which are to be included in the count of continuous service of 12 months. From the impugned award, I find no discussion on this vital aspect and I would, therefore, go by non-denial of the assertion in para.4 of the demand notice as made in its corresponding paragraph in the written statement where such particulars were not pleaded. In any case, it is 11 days short of the magical figure. Moreover, March 31, 2005 remains an artificial date to visit retrenchment in the absence of cogent evidence produced by the management of handing over housekeeping services to the IOC under an agreement or otherwise with the Corporation which runs Panipat Refinery to run the housekeeping activity to the exclusion of the school or that the management of the school had no say in MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -9- the manner in which the work would be performed through outsourcing system. It is not known who the contractors were, if any, and what the terms of the contract were. If there was an agreement or contract it was not produced on record from where this case could have been examined as well. Even in the written statement filed in this court, the agreement, if any, has not being placed on record. Therefore, the management has more to hide than reveal. An adverse inference can be reasonably drawn from the conduct and the facts collectively analysed that the management has failed to establish the connection between termination and Section 25-F or closure and Section 25 FFF of the ID Act. The Labour Court has not understood this fine distinction in labour law while rendering the award. It has blindly accepted the stand of the management that the workman had not completed 240 days of service in the preceding 12 calendar months. It is also noteworthy that the management did not produce the best evidence in proof of non-completion of 240 days and it sadly fell upon the worker who was compelled by silence of the management to seek out the record when faced with a situation which she herself may not have understood the implications of. Had the workman not summoned the record by producing a witness of the management as her own witness there would have been not even an iota of evidence for the management to have supported its defence of non- existence of jurisdictional facts on which alone relief can follow that is of completion of 240 days of "continuous service" as defined in section 25-B of the ID Act.
To appreciate the argument from the standpoint of Section 25-B. Continuous service means uninterrupted service for a period of one year. MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -10- The expression "actually worked" in Section 25-B of the Act would include Sundays, weekly off days, holidays as enunciated by courts of law to give flesh and blood and practical meaning to continuous service in the preceding 12 calendar months from the retrenchment. [See Workmen of Americn Express International Banking Corporation v. Management of Americn Express International Banking; AIR 1986 SC 458 and the observations of the Supreme Court:-
"The expression which we are required to construe is 'actually worked under the employer' {s.25B}. This expression, according to us, cannot mean those days only when the workman worked with hammer, sickle or pen, but must necessarily comprehend all those days during which he was in the employment of the employer and for which he had been paid wages either under express or implied contract of service or by compulsion of statute, standing orders etc."] For the foregoing reasons, I would have no reservations in setting aside the findings of the Labour Court on issue No.1.
In reaching this conclusion, I do not mean to say that an activity or part of it cannot be closed down by the management but the mandates of and obligations of ID law cannot be ignored and a process of reasoning deserves to be adopted which aims at not denying relief because relief should be denied as appears to be the view of the Labour Court. In Surendra Kumar Verma vs. CGIT-cum LC, New Delhi, (1981) the Supreme Court had occasion to say:-
"Semantic luxuries are misplaced in the interpretation of 'bread and butter' statutes. Welfare statutes must, of necessity, receive a MANJU broad interpretation. Where legislation is designed to give relief 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -11- against certain kinds of mischief, the Court is, not to make inroads by making etymological excursions".
This is not a case of a factory where a part of a manufacturing process is closed down leading to retrenchment and consequential payment of closure compensation. Here is a school. The petitioner; a Sweeper. If housekeeping activities are closed as part of school's obligations the services of the petitioner could have been continued in consultation with the IOC who if were asked may have readily continued the services of the petitioner as a Sweeper in the school through their agent instead of bringing a local fresher to do her job since the school was not being closed down only one of its essential activities was brought under the outsourcing policy. An outsourcing policy does not necessarily mean lock, stock and barrel change of human faces to run the show in the presence of existing workforce unless the old hands are not good enough or lack in efficiency or character and material prima facie supports such a view on judicial review. If the petitioner was only a menial daily wage Sweeper she could have been made to continue in the school where she worked for 7 years but under the direct control of the Corporation or its contractor, as the case may be. This would have been a more human thing to do. She was not claiming permanency or regularization of her services nor was such a dispute referred. If this arrangement was not offered then the petitioner may have a right of re-entry under Section 25-H of the ID Act, although there may have been a change of management from school to Corporation as the manager of the outsourced agent, by lifting the corporate veil. The hand that gave could have been changed without visiting the petitioner with such evil civil MANJU consequences of abruptly stopping her meagre livelihood for her family. 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -12-
The IOC is not a rank outsider who may not be saddled with any liability he did not bargain for. The school runs in IOC premises/building and for the benefit of the children of its employees. I think that both had a human and ethical duty to continue with the engagement of the petitioner as a daily wage employee when her work and conduct was not commented upon as adverse to the interest of the school or her work was in any way found lacking in its due performance or standard of care required for the job.
Thus, it is held that the petitioner was within her rights to refuse to accept cheque No.695572 dated April 12, 2006 after almost a year of termination which offer had no legal significance on her statutory rights but the deprivation of which fell significantly on the shoulders of the school in failing to comply with the obligations of the ID law and to have acted in breach of it. The petitioner is reinstated to service. She is held entitled to full back wages since the defence of closure was misconceived and based on falsehood.
A false defence in an action tends to prolong litigation while truthful statements in pleadings abridge it and make for speedier resolution of disputes. The labour Court unfortunately has no jurisdiction to grant stay of termination orders pending reference or to order the status quo ante. This leads to inequitable results weighted clearly in favour of the management who more often than not take advantage of the situation at the cost of the hapless worker. Long drawn out litigation in an industrial tribunal obfuscates relief to be granted or denied at the end of it. But delay should not by itself be used against a workman as an instrument of right deprivation, leaving courts to fathom what relief is to be granted searching MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -13- for a via media in selecting appropriate relief such as reinstatement with or without back wages, compensation in lieu of reinstatement or a percentage of arrears of back wages instead of full, in cases where relief is eminently grantable, depending in its measure from case to case. It is always difficult if not impossible for court to adequately compensate past suffering and this can only be equated in terms of money, reinstatement etc., but by that time the recipient of the wrong-doing is worn thin, the management usually euphoric and victorious on its wrong doing. The tempo has been set by the Supreme Court in Harjinder Singh v. Punjab State Warehousing Corporation Ltd, on breach of mandatory provisions of the ID Act while observing:-
" The courts have readily accepted such plea unmindful of the accountability of the wrong doer and indirectly punished the tiny beneficiary of the wrong ignoring the fact that he may have continued in the employment for years together and that micro wages earned by him may be the only source of his livelihood. It needs no emphasis that if a man is deprived of his livelihood, he is deprived of all his fundamental and constitutional rights and for him the goal of social and economic justice, equality of status and of opportunity, the freedoms enshrined in the Constitution remain illusory..."the Directive Principles of State Policy constitute an integral part and justice due to the workman should not be denied by entertaining the specious and untenable grounds put forward by the employer - public or private. "
What more can be said or better?
Resultantly, this petition is allowed with costs of Rs.50,000/- for putting a low paid marginal worker to a long battle fighting for her daily MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh CWP No.14256 of 2012 -14- survival and at much expense which she could ill-afford for which she deserves to be adequately compensated and therefore the costs are imposed. The impugned award dated May 16, 2011 is set aside. It is held that the petitioner was within her legal rights to refuse to accept cheque No.695572 dated April 12, 2006 after almost a year of termination which offer had no legal significance or bearing on her statutory rights under the ID law but the deprivation of which fell significantly on the shoulders of the school in failing to comply with its obligations and to have acted in breach of it. The petitioner is reinstated to service to her original position with continuity but would be paid current wages from the date of joining which should not be more than two months from the date this order is on the official website of the High Court to enable respondents to appeal against it. Failing which, the right to receive current wages will accrue irrespective of the actual date of rejoining and continue to run till satisfied.
(RAJIV NARAIN RAINA) 13.11.2014 JUDGE manju MANJU 2014.11.26 11:16 I attest to the accuracy and authenticity of this document High Court Chandigarh