Bombay High Court
Ramesh S/O. Pandharinath Taharabadkar vs Executive Engineer, Jayakwadi Project ... on 13 July, 2000
Equivalent citations: (2001)IIILLJ889BOM
Author: R.J. Kochar
Bench: R.J. Kochar
JUDGMENT R.J. Kochar, J.
1. The petitioner union appears to have espoused the cause of in all 107 employees who were employed by the State of Maharashtra under the Respondents Nos. 1 to 5 as the heads of their Divisions/ Departments respectively. The State Government had commenced and completed the gigantic project in the region of Marathwada for progress, welfare and benefits of the region, within a period of 30 years, namely Jayakwadi Project, under the Irrigation Department of the State. Admittedly the project was completed in 1976. On completion of the said project immediately next connected work of canal construction had to be started and the same was started in 1977 and was finally completed in 1984 in different phases as devised by the Respondents' engineers. Admittedly thousands of hands were required to complete such a gigantic project. As a result of the completion of the work/project retrenchment of workmen naturally becomes essential as they cannot be continued after the work is over. We are presently concerned with three groups of workmen who were amongst those retrenched as a result of closure of the divisions under the project. 86 workmen from the Division No. 1 were issued notices on December 29, 1984 and two workmen were issued such notices dated February 28, 1986 from the Division No. 3 and 11 workmen were issued such notices dated October 31, 1988 from Division No. 4. Another group of 7 workmen from a Division which is known as P.R.V.C. was also required to be issued such notices on October 31, 1988. The Respondents had issued aforesaid three sets of notices to the concerned workmen purportedly Under Section 25N of the Industrial Disputes Act, purportedly giving three months notice and purportedly saying in the notice that they would be retrenched after the expiry of three months. Since the notices were issued on different dates, three months expired on different dates. The contents of all the three sets of notices were identical. All the said notices informed the workmen that the work of the project was completed and that their services were not required and therefore, they had become redundant and therefore, their services were to be retrenched. In the said notices, they were further informed that they would be paid retrenchment compensation in accordance with law. It is an admitted fact that alongwith the said notices no, such retrenchment compensation was offered to them. The first notice dated June 30, 1984 expired on October 1, 1984, the second notice dated July 9, 1984 expired on October 9, 1984 and the third notice dated July 16, 1984 similarly expired on October 16, 1984. In respect of tender or offer of the retrenchment compensation Under Section 25-F of the Industrial Disputes Act, 1947 it has been the case of the Respondents that by a communication dated September 25, 1984, before the expiry of the three months notice period the workmen under the notices were informed that they should collect the retrenchment compensation from their respective offices of the divisions under which they were working. There is a dispute about the receipt of such letter.
2. The petitioner union challenged the aforesaid action of the retrenchment of the workmen by filing a complaint of unfair labour practice under items 5, 7 and 9 of Schedule IV of the M.R.T.U. and P.U.L.P. Act, 1971. The thrust of the complaint was only Item no. 9 of Schedule IV of the Act. Other items have not been even referred to by the learned Advocate for the complainant. The entire emphasis was on Item 9 i.e. "failure to implement award settlement or agreement". Based on the ratio of the judgment of the Supreme Court in the case of S. G. Chemicals and Pharmaceutical Company's case the petitioner questioned the orders of retrenchment issued by the Respondents being in violation of Sections 25-F, 25-N, 25-G and Section 33(2) of the Industrial Disputes Act, 1947. Since the Respondents have not implemented the aforesaid legal provisions of the Act, they have committed an unfair labour practice within the meaning of Item no. 9 of the Schedule IV of the Act, is the only submission on the part of the petitioner union.
3. Both the parties adduced their documentary and oral evidence before the Industrial Court. The learned Member of the Industrial Court framed as many as 14 issues and answered the same on the basis of the pleadings and evidence against the petitioner union and dismissed the complaint by his order dated April 28, 1989. The petitioners have challenged the aforesaid order before this Court under Article 227 of the Constitution of India. I have heard both the learned advocates for the petitioner union as well as the Respondents. I have carefully gone through the proceedings and the impugned judgment and order of the learned member of the Industrial Court. The learned member has recorded his reasons for the conclusions drawn by him. Generally, I do not find any illegality or infirmity in the conclusion part of the order. As far as the want or absence of evidence is concerned, the learned member is right as the petitioners have failed to bring on record the required evidence in support of their case that the retrenchment orders were void abinitio and illegal being in contravention of the mandatory provisions of Sections 25-F, 25-G and 33 of the Industrial Disputes Act, 1947. Not even a single workman has stepped in the witness box to say that no retrenchment compensation was offered to him or to say that he had not received a communication "requiring him to collect the amount of retrenchment compensation from the office of the Division where he was an employee. Even in the case of seniority no evidence was adduced to say that there was violation of rule of seniority framed Under Section 25-G of the Act. Similarly there is hardly any case for the petitioners to challenge the retrenchment orders on the ground of violation of Sections 33(1) and 33(2) of the Act. The challenge in respect of violation of Section 33(1) and (2) of the Act is on the ground that conciliation proceedings in respect of general demands of the employees of the Irrigation Department of the entire State of Maharashtra were pending and during the pendency of such conciliation proceedings 107 workmen have been issued retrenchment notices which amounted to alterations in their service conditions. It is clear from the record that no such conciliation proceedings were pending when the retrenchment notices under question were issued by the Respondents. Admittedly the conciliation proceedings were commenced on and from September 18, 1984 while retrenchment notices were issued much before this date. I am not able to accept the submissions on the part of the petitioners that the period of 3 months given in the said notices expired after the conciliation proceedings were commenced and therefore, there was violation of Section 33(1) and (2) of the Act. It would be a far fetched argument. The point of alteration in service, in the case of retrenchment was on the date of the notice and not after the expiry of notice period of 3 months. On the date of such notices the conciliation proceedings were not commenced and were not pending and therefore, the challenge to the legality of such notices Under Section 33(1) and (2) of the Act must fail. There is no substance in the submissions on behalf of the petitioner.
4. Similarly, there is absolutely no merit in the case of the petitioners that there was violation of Rule 81 read with Section 25-G of the Act. It is borne out from the record that a seniority list was displayed in accordance with the rules and that while resorting to retrenchment it was strictly complied with. There is no rebuttal from the workmen. The petitioners have not substantiated their allegations of violation of Section 25-G read with Rule 81 of the Industrial Disputes Act, 1947. The petitioner's case must fail even in this respect.
5. The next submission of Shri Shahane, the learned Advocate for the petitioners is that of violation of Section 25-N of the Industrial Disputes Act, 1947. By an amendment in the year 1976 a new Chapter V-B inserting special provisions relating to "lay off "retrenchment", and "closure" in certain establishments was brought in force. It is a self contained and complete Code in respect of the items mentioned in the title of the Chapter i.e. "lay-off, "retrenchment", and 'closure' in certain establishments. The Chapter applies to certain industrial establishments which are separately and independently defined in the Chapter. It is pertinent to note that the legislature has carved out separate "industrial establishments" to which this Chapter is made applicable. The words "industrial establishments" have been generally defined in the definition Section i.e. Section 2(ka). As it was specifically contemplated to apply this Chapter to certain industrial establishments only a special definition is given Under Section 25-L of the Act for the purposes of this Chapter. The industrial establishment is defined to mean a "factory", a "mine" and a "plantation" as defined in the respective statute applicable to them. At the threshold the irrigation department or the Divisions of the Irrigation Department established for the purpose of the project do not fall in the specific definition of the industrial establishment under Section 25-L of the Chapter. It is neither a "factory" nor a "mine" nor "plantation". According to me therefore, it is futile to argue that the divisions in which the retrenched workmen were employed attract the Chapter V-B of the Act. According to me these divisions ex-fade are not industrial establishments as specially defined for the purpose of the Chapter V-B itself. I am therefore, not able to accept the submissions of Shri Shahane, that Section 25-N of the Chapter V-B is attracted in the present case. The emphasis of the learned advocate is that the notices issued to the workmen have referred to the said Section and therefore, the Chapter V-B was applicable to the divisions and since no permission from the State Government was taken as required Under Section. 25-N of the Act, the retrenchment notices were void abinitio. I am not able to agree with this submission. It is a fact that in all the retrenchment notices under question, there is a reference to Section 25-N of the Act. It is the case of the Respondents that they had approached the State Government for such permission Under Section. 25-N of the Act, but they were informed that no such permission was required as the V-B Chapter was not applicable in the case. It appears that a layman in the department was under the impression that for every case of retrenchment permission from the State Government was mandatory. It was a layman's view and hence, we have to scrutinise closely whether the divisions of the project really answer the test laid down in the said definition clause given Under Section. 25-L of the Act. Only three types of establishments are covered by the Act by the definition i.e. "factory", a "mine" and a "plantation". Obviously and ex-fade the aforesaid divisions of the Jayakwadi Project of the Irrigation Department do not answer any of the descriptions. According to me therefore, Chapter V-B of the Act, is not at all applicable in the present case. Consequently, I hold that Section 25-N of the Act is also not attracted and the decision of the State Government that Chapter V-B of the Act was not applicable and therefore, there was no necessity of following Section 25-N of the Act was right. In these circumstances, I hold that there is no violation of Section 25-N of the Act. This challenge to the retrenchment orders also must fail.
6. In respect of the allegations of violation of Section 25-G and Section 33(1)(2) of the Industrial Disputes Act, 1947 I must mention that there has been a clear admission on the part of the petitioners that Rule 81 as well as the provisions of Section 25-G in respect of seniority were complied with. Secondly, I also find that the petitioner union was not one of the 31 unions which were representing before the Conciliation Officer. It therefore, cannot be said that the Respondents have violated the aforesaid provisions by not complying with the provisions of Section 33(1)(2) of the Industrial Disputes Act. The members of the petitioner union were not the concerned workmen before the conciliation proceedings. It is clear that such objections are taken by the petitioner union for the sake of raising such objections without pressing them seriously and without substantiating them by proper material. Same is the case with the objection of compliance of Section 25-N which I have already discussed in the foregoing paragraphs. There is absolutely no substance in all these objections of the petitioner union.
7. The last and main objection of the petitioner is that of violation of Section 25-F of the Industrial Disputes Act. Before dealing with this point I must mention as a matter of fact that the factum of closure of all the concerned Division is not all in dispute. There is no denial of the fact that the concerned project and its divisions were closed permanently, finally and irrevocably as the entire Jayakwadi project was completed long back. In the process as and when work gets completed, the divisions get closed and wound-up. Such work is never of perennial or permanent nature but has its own long or short duration. The State Government has also issued separate Government Resolutions to effect such closure of the divisions. The impugned retrenchment orders were the sequiter of such closure of the divisions. At the first blush one would be prima facie attracted to accept the contention of violation of Section 25-F of the Act by reading the common retrenchment notices which do not mention the offer of retrenchment compensation alongwith the notice. All the retrenchment notices have informed the employees that they would be paid retrenchment compensation in accordance with the law. It was three months notice and the employees were to stand relieved after expiry of three months period. There is no definite and specific offer or tender of the retrenchment compensation in this notice and therefore, it was vehemently contended that the order of retrenchment was ex-facie in violation of Section 25-F of the Act. There has been only an assurance in the notice that retrenchment compensation will be paid. It is also brought on record that after issue of the aforesaid notice a separate offer of retrenchment compensation was made by a letter dated September 25, 1984 requiring the employees to collect their retrenchment compensation from their concerned divisions. Considering the large number of employees employed in various distant divisions spread over miles of the distance, it will' be totally impracticable and impossible for the cashiers to carry the cash to the site of the employees and to offer or pay them the same alongwith retrenchment notices.
According to me it would be sufficient compliance of Section 25-F of the Act in such circumstances if the employees are requested to collect their retrenchment compensation from the cashier in the departments. The cashier or the accountant or the Manager or the employer cannot be expected to chase the employees on the site wherever they might be posted or they might be physically available on work particularly when such gigantic projects are undertaken by the Welfare State in the interest of the people at large. As is in our case the work of project and the work of canal construction spread over miles together and the workers were working at various places and spots, it would be totally unreasonable to expect the accountants and cashiers or the Executive Engineers to carry cheques or cash with them alongwith retrenchment notices/letters and to offer them at the site of the canal construction work under various divisions. I do not find anything wrong or breach of Section 25-F if the employer has requested the workman/ workmen to come to the accounts department or the office and collect the amount of retrenchment compensation as required Under Section 25-F of the Act. According to me in the present case the notice of retrenchment carried an assurance that retrenchment compensation would be paid and subsequently by a separate letter the workmen were informed and they were requested to collect the retrenchment compensation from the office. There is no violation of Section 25-F of the Act and therefore, I am not able to accept the contention of the petitioner that the retrenchment notices/orders were in violation of the mandatory provisions of the Act and therefore, they were null and void.
8. Besides, I am also of the opinion that the provisions of Section 25-F of the Act are not attracted and are not applicable in the cases which are covered by Section 25-FFF. The relevant portion of Section 25-FFF reads as under:
"25 FFF (1)....
25 FFF(2) Where any undertaking set-up for the construction of buildings, bridges, roads, canals, dams or other construction work is closed down on account of the completion of the work within two years from the date on which the undertaking had been set up, no workman employed therein shall be entitled to any compensation under Clause (b) of Section 25-F, but if the construction work is not so completed within two years, he shall be entitled to notice and compensation under that Section for every (completed year of continuous service) or any part thereof in excess of six months)."
The aforesaid provisions are crystal clear. The concerned divisions aptly answer the description of an undertaking as they were set up for the construction of canals/dams and other construction work. They were closed down on account of the completion of the work after a period of two years. In accordance with Section 25-FFF(2) the workmen are entitled to notice and compensation Under Section 25-F of the Act In the present case all the ingredients of Section 25-FFF are present and have been factually proved beyond any shred of doubt. According to me there is no provision incorporated in Section 25-FFF to tender or offer or pay retrenchment compensation at the time of retrenchment of the workmen as a condition precedent. If the case is covered by Section 25-FFF(2) the workmen are definitely entitled to get retrenchment compensation to be computed in accordance with Section 25-F of the Act but the payment of such compensation is not made a condition precedent. If the employer offers such compensation subsequently, such an act would not be illegal or in contravention of Section 25-F of the Act. What is required of the employer is that he should pay compensation in accordance with Section 25-F of the Act. In our case the construction of canal work was completed and the workmen were given three months' notice and were subsequently told and required to collect their retrenchment compensation from the respective offices of the divisions. The action of the Respondents was perfectly legal and proper and there was no breach or violation of any of the provisions of the Industrial Disputes Act, 1947. On the point of applicability of Section 25-F to a case of closure of an undertaking the Supreme Court has held that it did not apply in such case. The Supreme Court in the case of Avon Services Production Agencies (P) Ltd. v. Industrial Tribunal' Haryana and Ors. has compared both the provisions and has concluded as under in 1979-I-LLJ-1 at 8:
"17. A comparison of the language employed in Section 25-F and Section 25-FFF(1) would bring about in bold relief the difference between the phraseology employed by the Legislature and its impact on the resultant rights of the workmen. Under Section 25-F a workman employed in an industrial undertaking cannot be retrenched by the employer until the payment is made as provided in Clauses (a) and (b). Section 25-FFF(1) provides that the workman shall be entitled to notice and compensation in accordance with the provisions of Section 25-F if the undertaking closed for any reason, as if the workman has been retrenched. Taking note of this difference in language, this Court in State of Bombay v. The Hospital Mazdoor Sabha, held that the failure to comply with the provision prescribing conditions precedent for valid retrenchment in Section 25-F renders the order of retrenchment invalid and inoperative. Expounding this position, a Constitution Bench of this Court in Hatisingh Mfg. Co. Ltd. v. Union of India held that the Legislature has not sought to place closure of an undertaking on the same footing as retrenchment under Section 25-F. By Section 25-F a prohibition against retrenchment until the conditions prescribed by that Section are fulfilled, is imposed by Section 25-FFF.
(1) termination of employment on closure of the undertaking without payment of compensation and without either serving notice or paying wages in lieu of notice is not prohibited. Payment of compensation and payment of wages for the period of notice are not, therefore, conditions precedent to closure."
In a more recent judgment of the Supreme Court reported in Management of Dandakaranya Project, Koreput v. Workmen through Rehabilitation Employees Union and Anr. has observed as under to indicate that where a project is completed Section 25-FFF would be attracted and the affected workmen would be entitled to receive retrenchment compensation as provided thereunder 1997-I-LLJ-833 at 837.
"Under the Industrial Disputes Act if an industry is closed the employees thereof are entitled to compensation as provided under Section 25-FFF of the Industrial Disputes Act. During the pendency of this appeal on behalf of the Union a Scheme has been framed seeking 100 months' full pay as compensation, the Scheme being called the Golden Handshake Scheme, but even the said Scheme was found to be unworkable and the Ministry concerned filed an affidavit indicating the reasons for not implementing the said Scheme. On the admitted position that the Dandakaranya Project has been completely wound up since 1990 and these N.M.R. workers would have been otherwise retrenched but for the interim order of this Court in consequence of which the project authorities have been paying every month to these workers to the tune of Rs. 1.50 lakhs without getting them engaged in any work, we think that any direction to pay compensation in terms of the Scheme will not be in the interest of justice. But however, the workers would be entitled to their rightful dues on account of closure of the project as envisaged under Section 25-FFF of the Industrial Disputes Act."
9. It is an admitted position that out of 106 retrenched workmen 46 of them had accepted the amount of retrenchment compensation pursuant to the letter dated September 25, 1984 issued by the Respondents. It is also an admitted position that 15 of the retrenched workmen were absorbed at some other places. According to the Respondents they had genuinely bona fide tried to absorb as many workmen as possible and they had tried to avoid unemployment. I accept their genuine and bona fide efforts to try to absorb the maximum number of the retrenched workmen. I however, cannot direct to absorb the remaining workmen elsewhere. Shri Shahane, the learned advocate for the petitioner tried to persuade me to issue such orders in the interest of justice. While deciding the petition under Article 226 of the Constitution of India, I cannot forget the powers and jurisdiction of this Court. I have to do justice in accordance with law as I am not sitting tinder the banyan tree to do justice in accordance with my own concept of justice. I also cannot direct the Respondents to employ the retrenched workmen elsewhere in other scheme and regularize them and to continue them in other places. The Supreme Court has not approved such orders passed by another High Court. In the case of State of H. P. through the Secretary (Rural Development) to the Govt. of H.P. Shimla v. Ashwani Kumar and Ors. the judgment is conclusive on this point 1996-1- LLJ-869 at 869, 870:
"4. It is seen that when the project is completed and closed due to non-availability of funds, consequently, the employees have to go along with the closed project. The High Court was not right in giving the direction to regularize them or to continue them in other places. No vested right is created in temporary employment. Directions cannot be given to regularize their services in the absence of any existing vacancies nor can directions be given to create posts by the State to a non-existent establishment. The Court would adopt pragmatic approach in giving directions. The directions would amount to creating of posts and continuing them in spite of nonavailability of the work. We are of the considered view that the directions issued by the High Court are absolutely illegal warranting our interference. The order of the High Court is set aside."
Shri Shahane, has cited a judgment of this Court given by a Learned single Judge (F.I. rEBELLO, J.) reported in Executive Engineer, Yavatmal Medium Project Division and Anr. v. Anant s/o. Yadav Murate and Anr. 1998-11-LLJ-77 (Bom) I have carefully gone through the whole judgment of the learned Judge. The learned Judge has summarised the whole judgment in paragraph 19. I am in respectful agreement with him on all the points which he has very exhaustively dealt with. I however fail to understand how that will apply in the present case. There is no dispute regarding the Irrigation Department being an industry. In our case the question regarding applicability of Chapter V-B of the Act is concerned, while in the case before the learned Judge it was the applicability of V-A was involved. I therefore, hold that the ratio of the said judgment will not apply to the facts of the present case.
10. In view of the above discussion I hold and conclude that there is absolutely no substance and merits in the present case and the same deserves to be dismissed. The Writ Petition is hereby dismissed with no order as to costs. Rule is discharged. The issuance of certified copy is expedited.