Punjab-Haryana High Court
Mani Ram vs The Presiding Officer, Labour Court on 27 February, 1996
Equivalent citations: [1997(75)FLR132], (1998)IILLJ519P&H, (1996)113PLR39
Author: R.L. Anand
Bench: R.P. Sethi, R.L. Anand
JUDGMENT R.L. Anand, J.
1. By this Judgment we dispose of Civil Writ Petition Nos. 12538, 12718 to 12721, 14418 and 16919 to 16921 of 1994 as common question of law and tact is involved in all of them with regard to the compliance of the provisions of Section 25F ot the Industrial Disputes Act, 1947 (for short 'the Act').
2. The petitioners in all the petitions have given challenge to the award dated December 30, 1993 of the Presiding Officer, Lahour Court, Ambala, vide which it was held that there was no merit in the reference of the workmen. Resultantly, none of the workmen was entitled to any relief. It is the admitted case of the parties that each of the petitioners had completed 240 days of service before their services were terminated by the management. It is also the common case of the parties that retrenchment compensation was not paid in cash on the day when the services of the petitioners were terminated. The management took the action which can be incorporated as follows:-
"It may be noted from ail persons as mentioned in the list attached that they should collect their retrenchment compensation on February 17, 1983 and February 18, 1983 from this office.
Sd/-
Executive Engineer U.O.N0.568/HC II Dated February 16, 1983.
Yet another letter was written by the office, which reads as follows :-
"Your retrenchment compensation, pay & allowances for the month of 2/83 have been drawn and are lying in this office. You are requested to collect the same at once.
Please acknowledge the receipt of this letter.
Sd/-
Executive Engineer/HC II WYC, PE Project, HSEB, Bhudkalan".
This letter is dated February 25, 1983. The services of all the petitioners were terminated on February 20, 1983. The stand of the management before the Labour Court was each of the workmen was asked to collect the compensation before February 20, 1983. Every effort has been made by the management but the offer to receive the retrenchment compensation has not been accepted by the workmen. Thus the provisions of Section 25F of the Act have been complied with. It was also the case of the management before the Labour Court that the workmen served the demand notice after a period of four years and for that reason the workmen are not entitled to be reinstated into service. The claim is stale. The Labour Court came to the conclusion that the workmen had the knowledge with regard to the collection of the retrenchment compensation amount from the office of the Executive Engineer, Bhudkalan and that the workmen could collect the compensation on February 17, 1983 and February 18, 1983 before the expiration of the notice, which was to expire on February 20, 1983. Since the workmen failed to collect the amount from the office on the said dates, the management sent the amount through the money order, which was not accepted by the workmen and the report of the Postal Authorities indicating "refused" cannot be doubted in this regard. The Labour Court also came to the conclusion that since the management had offered retrenchment compensation to the workmen well within time and the workmen, in fact, deliberately chose not to accept the same, for this reason there is no justification in the reference of the workmen and they are not entitled to any relief either by way of reinstatement into service, continuity of service or the payment of backwages.
3. As I submitted at the very first instance, the point for determination in this case is whether the provisions of Section 25F of the Act have been complied with properly by the management when it simply gave a notice to the workmen to collect the retrenchment compensation on February 17, 1983 and February 18, 1983. It has also to be seen whether the management is absolved of its statutory duty by sending the money order after the expiry of the date of the notice, i.e. February 20, 1983.
Section 25F of the Act lays down as follows :-
"25-F. 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 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 retrenchment notice is dated January 20, 1983 and it is mentioned in it that since there was less work in progress against which the service of the workmen could be utilised, hence one month's notice under Section 25F of the Act was given and further it was mentioned that every workman should treat himself being relieved from service with effect from February 20, 1983, i.e., the expiry of one month's notice period. Also it was mentioned in the letter dated January 20, 1983 that the workman can collect the retrenchment compensation if payable under Section 25B of the Act on February 22, 1983. No retrenchment compensation was given on February 20, 1983. Rather on February 16, 1983 the management wrote the letter calling upon the workmen to collect the retrenchment compensation on February 17, 1983 and February 18, 1983. After the appointed date, i.e., February 20, 1983 the management wrote letter dated February 25, 1983 calling upon the workman that their retrenchment compensation, pay and allowances for the month of February 1983 had been drawn and were lying in the office. The workmen were requested to collect the same at once.
4. A perusal of the provisions of Section 25F would reveal that these provisions are mandatory in nature and Clause (b) of Section 25F postulates that no workman shall be retrenched until he has been paid compensation at the time of retrenchment. This Section contains mandate that the employer shall not retrench a work-
; man unless retrenchment compensation has been paid prior or at the time of the retrenchment. In the present case the condition postulated in Section 25-F(b) has not been complied with. It is no doubt correct that the workmen were directed to collect the retrenchment compensation on February 17 & 18, 1983 but by this letter the management is not exonerated of its statutory liability. Also the management is not exonerated nor it can be said that it has complied with the provisions of Section 25F by sending the money order, which was sent after the relevant date, i.e., February 20, 1983. Even the letter dated February 25, 1983 is not a compliance of the provisions of Section 25F of the Act. The learned Labour Court while passing the award has not correctly appreciated or inter-
preted the legal effect of the statutory provisions of Section 25F of the Act. The erroneous approach of the Labour Court while applying the provisions of Section 25F to the facts has caused miscarriage of justice to each of the . workmen and which finding of the learned Labour Court cannot be upheld. It has been held in Shri Mohan Lal v. The Management of Bharat Electronics Ltd. (1981-II-LLJ-70) (SC), that it is well settled that where pre-requisite for ] valid retrenchment as laid down in Section 25F has not been complied with, retrenchment bringing about termination of service is ab initio void. Similar view was also taken in State of Bombay and Others v. The Hospital Mazdoor Sabha and Ors. (1960-I-LLJ-251) (SC), that failure to comply with the requirement of Section 25F which prescribes a condition precedent for a valid retrenchment renders the order of retrenchment invalid and inoperative. In other words it does not bring about cessation of service of the workman. The workman continues to be in service.
5. Realising the above difficulty posed by the provisions of Section 25F of the Act, the learned counsel appearing on behalf of the management argued before us that the claim of the workmen is stale when they took steps for adjudication of the industrial disputes in the year 1986. On this ground the award of the Labour Court should be upheld. We are not in agreement with the argument raised by the learned counsel for the respondents. The Legislature purposely in its wisdom has not mentioned any limitation about the raising of the industrial disputes by the workmen. The stale claim of a workman, however, can compel us to think as to what relief should be given to them. Mere delay in raising an industrial issue does not disentitle a workman from raising the industrial dispute. Termination of service is admittedly an industrial dispute within the meaning of Section 2(k) of the said Act.
6. During the course of arguments, learned counsel appearing on behalf of the petitioners fairly conceded before us that his clients would be satisfied if they are reinstated into service with the benefit of continuity of the same and that they shall not claim backwages. In our view, the offer made by the workmen is quite judicious. This squarely meets the arguments of the learned counsel for the respondents that the demand of the workmen was stale. Since the mandatory provisions of Section 25F of the Act have not been complied with the management when it did not pay the retrenchment compensation simultaneously with the enforcement of the retrenchment notice, therefore, we have no hesitation to hold that the retrenchment of the petitioners was illegal and the retrenchment orders are liable to be quashed and we order accordingly.
7. Resultantly, all the writ petitions are allowed. The retrenchment notice placed in each of the writ petitions is quashed. The petitioners shall be deemed to have been reinstated into service with effect from February 20, 1983 and they shall be given the benefit of continuity of 5 service but without backwages. There shall be no order as to costs.