Delhi High Court
Surender Kumar vs Dcm Ltd. & Ors. on 18 May, 2011
Author: Rajiv Sahai Endlaw
Bench: Rajiv Sahai Endlaw
*IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 18th May, 2011
+ W.P.(C) 7744/1999
% SURENDER KUMAR ..... Petitioner
Through: Mr. Vinay Sabharwal & Ms. Neha
Sabharwal, Advocates
Versus
DCM LTD. & ORS. ..... Respondents
Through: Mr. Harvinder Singh & Mr. Prateek
Kohli, Advocates
CORAM :-
HON'BLE MR. JUSTICE RAJIV SAHAI ENDLAW
1. Whether reporters of Local papers may No
be allowed to see the judgment?
2. To be referred to the reporter or not? No
3. Whether the judgment should be reported No
in the Digest?
RAJIV SAHAI ENDLAW, J.
1. The writ petition impugns the award dated 13th September, 1999 of the Industrial Adjudicator on the following reference:
"Whether the services of Sh. Surender Kumar have been terminated illegally and / or unjustifiably, if so, to what directions are necessary in this regard?" W.P.(C) 7744/1999 Page 1 of 14
holding the termination of employment of the petitioner workman by the respondent employer to be illegal and unjustified but granting the relief only of five years pay at the rate of last drawn wages to the petitioner workman.
2. The writ petition was filed impugning the award declining the relief of reinstatement with full back wages, continuity of service and all other consequential benefits to the petitioner workman and seeking the said reliefs against the respondent employer.
3. Notice of the writ petition was issued and vide order dated 18 th July, 2002, the respondent employer directed to deposit the amount awarded by the Industrial Adjudicator with the Registrar General of this Court, to be kept in a fixed deposit for a period of six months. On 11 th December, 2002, it was informed that in pursuance to the said direction an amount of `38,400/- had been deposited by the respondent employer and kept in a fixed deposit. The fixed deposit was directed to be renewed from time to time. Rule was issued in the petition. The counsels for the parties have W.P.(C) 7744/1999 Page 2 of 14 been heard. The counsels have confined the submissions to the quantum of compensation.
4. The petitioner workman was working in the Weaving Department of the respondent employer with effect from 10 th March, 1976; on 18 th November, 1981 while on duty, he was indisposed and was granted medical leave from 19th November, 1981 to 25th November, 1981; he claimed to have again fallen ill and reported back for duty on 3rd December, 1981 when he was not allowed. The respondent employer claimed that the petitioner workman owing to absence without leave from 26th November, 1981 for more than 10 days, under the Standing Orders, had lost lien on his employment. The said action of the respondent employer has been held to be illegal and unjustified by the Industrial Adjudicator. There is no challenge to the said finding and the said facts have been mentioned only for their relevance in the determination of quantum of compensation.
5. The Industrial Adjudicator in the award though having held the termination by the respondent employer of the employment of the W.P.(C) 7744/1999 Page 3 of 14 petitioner workman to be illegal, did not grant the relief of reinstatement for the reason of it having come on record that the mill in which the petitioner workman was employed had been closed in 1989 pursuant to an order of the Lieutenant Governor, Delhi. It was even otherwise held that it was not proper to order reinstatement after lapse of 18 years.
6. The Industrial Adjudicator while calculating the quantum of compensation to which the petitioner workman was entitled to in lieu of reinstatement noted that the petitioner workman had not alleged in the Statement of Claim that he was out of job; that he did not depose so in his examination in chief; that in his cross examination, he admitted that he made no efforts to seek gainful employment. The Industrial Adjudicator held that the petitioner workman had a duty to mitigate the loss.
7. It was the claim of the petitioner workman before the Industrial Adjudicator and is, before this Court also, that the petitioner workman was entitled to compensation equivalent to salary / emoluments till the closure of the mill i.e. from 1981 till 1989, plus closure compensation equivalent W.P.(C) 7744/1999 Page 4 of 14 to 5 years' salary which the respondent employer had paid to the other workmen employed in the Mill.
8. The respondent employer opposes the claim for compensation on the basis of aforesaid on the ground that closure compensation could not be granted being beyond the scope of reference; that the petitioner workman ought to have got the reference amended if he wanted to claim closure compensation before the Industrial Adjudicator; that closure compensation could be paid only to those employees who were on the rolls of the respondent employer on the date of closure.
9. The Industrial Adjudicator justified the grant of compensation of five years pay at the rate of last drawn wages as meeting the ends of justice by also observing that at the most, the petitioner workman could claim 50% wages from the date of filing the claim in 1983 till closure in 1989 i.e. three years salary and the remaining amount would be towards closure compensation.
W.P.(C) 7744/1999 Page 5 of 14
10. The counsel for the petitioner workman has contended that once the termination was held to be illegal, the effect thereof would be to deem the petitioner workman to be in employment till the date of closure and in which event he would have been entitled to the closure compensation paid to the other employees. He has thus contended that the closure compensation of five years at the rate of the emoluments which the petitioner workman would have earned in the year 1989 could not have been denied in any case to the petitioner workman; in addition, the petitioner workman is also entitled to emoluments from the date of illegal termination till closure.
11. Per contra, the counsel for the respondent employer has relied on:
(i) Parry & Co. Ltd. Vs. P.C. Pal (1969) 2 SCR 976 to contend that this Court in exercise of jurisdiction of judicial review under Article 226 of the Constitution of India ought not to interfere in the discretion exercised by the Industrial Adjudicator as to the quantum of compensation. The Supreme Court in the said judgment held that a mere wrong decision W.P.(C) 7744/1999 Page 6 of 14 cannot be corrected by a writ of certiorari as that would be using it as the cloak of an appeal in disguise and that only a manifest error apparent on the face of the proceedings based on a clear ignorance or disregard of the provisions of law or absence of or excess of jurisdiction, when shown, can be so corrected.
(ii) Regional Manager, S.B.I. Vs. Rakesh Kumar Tewari (2006) 1 SCC 530 laying down that if a plea in respect of Section 25G of the I.D. Act is not put forward, it is not open to the Tribunal to "go off on a tangent" and conclude that the termination of service of the respondent was invalid. The said judgment has been cited to contend that the aspect of closure compensation could not have been gone into by the Industrial Adjudicator.
(iii) Anoop Sharma Vs. Executive Engineer (2010) 5 SCC 497 also on the aspect of interference in labour matters and laying W.P.(C) 7744/1999 Page 7 of 14 down that when the award of the Industrial Adjudicator is not vitiated by error of law apparent on the face of the record, the High Court should not interfere.
12. The counsel for the respondent after the close of hearing has also filed copies of the following judgments:-
a. J.K. Iron & Steel Company Ltd. vs. Iron & Steel Mazdoor Union 1956(I) LLJ 227 SC - however the said judgment is not found applicable;
b. Rolston John v. Central Government Industrial Tribunal-cum-
Labour Court AIR 1994 SC 131 where the Supreme Court had awarded lump sum compensation of `50,000/- for failure to follow procedure under Section 25F of the Act; c. Smt. J. Twari v. Smt. Jawala Devi Vidya Mandir 1979 (1) SLR 614 SC - on the aspect of the employee being required to mitigate the damages by trying to obtain an alternative employment;
W.P.(C) 7744/1999 Page 8 of 14
d. Kendriya Vidyalaya Sangathan v. S.C. Sharma (2005) 2 SCC 363 laying down that initial burden is on the employee to show that he was not gainfully employed and it is only thereafter that the employer can bring on record materials to rebut the claim of the employee and without the employee pleading or proving any such material, full back wages cannot be awarded;
e. U.P.State Brassware Corporation Ltd. v. Uday Narain Pandey (2006) 1 SCC 479 laying down that full back wages cannot be allowed automatically or mechanically only because an order of termination is found to be unsustainable;
f. State of M.P. v. Arjunlal Rajak (2006) 2 SCC 711 laying down that for non-compliance of Section 25F, ordinarily workman could be directed to be reinstated with or without back wages, but when a project or scheme or an office itself is abolished, relief of reinstatement is not to be granted;
13. The counsel for the petitioner also, after the close of hearing, has filed copies of the following judgments;
W.P.(C) 7744/1999 Page 9 of 14
(i) Anoop Sharma (supra) laying down that non-compliance Section 25F renders the termination to be nullity and the employee is entitled to continue in employment as if his services were never terminated. I may however note that the said case was not concerned with the quantum of compensation;
(ii) Mohan Lal v. Management of Bharat Electronics Ltd. AIR 1981 SC 1253 laying down that where pre-condition for a valid retrenchment is not satisfied, termination of services is ab initio void, inoperative and invalid and the workman continues in service with consequential benefits. This judgment again was not concerned with the aspect of compensation;
(iii) DCM Ltd. v. Lt. Governor, Delhi 37 (1989) DLT 425 to contend that the workman is legally entitled to closure compensation under the golden handshake scheme according to which every affected workman is to be granted an amount equivalent to six years' wages as closure compensation. W.P.(C) 7744/1999 Page 10 of 14
14. I am unable to agree with the contention of the counsel for the respondent employer that the aspect of retrenchment compensation could not have been considered for the reason of the petitioner workman having not got the reference amended. The Industrial Adjudicator after holding the action of the respondent employer of terminating the employment of the petitioner workman to be bad and which would have ordinarily led to the relief of reinstatement, held the relief of reinstatement to be not possible for the reason of the closure. The respondent employer cannot be heard to, on the one hand contend that owing to closure the relief of reinstatement should be denied and on the other hand that the closure compensation should not be considered.
15. However, I tend to agree with the contention of the counsel for the respondent employer of the computation of compensation by the Industrial Adjudicator being subject to judicial review only on limited grounds. This Court would interfere in the computation of compensation only when finding the computation to be without any basis whatsoever or perverse or preposterous considering the facts of the case. The Industrial Adjudicator W.P.(C) 7744/1999 Page 11 of 14 in the present case has given reasons for computation done by him. He has taken into consideration the period of about 4 to 5 years only for which the petitioner workman had worked with the respondent employer, the lack of any plea and evidence by the petitioner workman of after termination having remained unemployed and of the possibility of the petitioner workman continuing in the employment of the respondent employer till the age of working being non-existent owing to the closure aforesaid. Considering all the said factors, the thumb rule of compensation at the rate of five years' salary last drawn was arrived at.
16. The question which arises is that, should this Court exercising power under Article 226 of the Constitution of India interfere with such computation. The counsel for the petitioner workman has not controverted any of the factors aforesaid taken into consideration by the Industrial Adjudicator for computing the compensation. The only ground is that computation should have been at the rate of 100% of the wages from the date of termination till closure plus closure compensation paid to others. There is no principle of law entitling an employee to 100% back wages. W.P.(C) 7744/1999 Page 12 of 14 The Industrial Adjudicator even while granting reinstatement has the discretion extending from not awarding any back wages to awarding 100% of the back wages. The Industrial Adjudicator in the present case for the reason of the petitioner workman having not even pleaded non employment since termination appears to have not found the petitioner workman entitled to any back wages. As far as compensation for reinstatement was concerned, the Industrial Adjudicator has followed the principle of closure compensation of 5 years' salary. The Industrial Adjudicator has looked at the same from the alternative angle of the compensation so awarded being equivalent to 50% of back wages and two years' salary as compensation. The petitioner workman whose services were terminated eight years prior to closure and who had not even pleaded being without a job for the said eight years cannot certainly claim parity with other employees who were rendered jobless on closure.
17. I therefore do not find any case for interference to have been made out. I am however pained to see that even the awarded amount does not appear to have been paid to the petitioner workman. I am surprised that the W.P.(C) 7744/1999 Page 13 of 14 petitioner workman in the last 12 years since when the petition has remained pending in this Court has not even applied for release of the money deposited in the Court. Be that as it may, the same together with interest accrued thereon be now released to the petitioner workman forthwith.
18. The petition is accordingly dismissed. No order as to costs.
RAJIV SAHAI ENDLAW (JUDGE) MAY 18, 2011 'gsr'..
W.P.(C) 7744/1999 Page 14 of 14