Allahabad High Court
U.P. Forest Corporation And Anr. Etc. ... vs Presiding Officer, Labour Court And ... on 10 December, 2004
Equivalent citations: 2005(1)ESC462
Author: Ashok Bhushan
Bench: Ashok Bhushan
JUDGMENT Ashok Bhushan, J.
1. These writ petitions raise common question of facts and law and challenge awards given by Labour Court, U.P., Rampur, in different adjudication cases registered before the Labour Court, in pursuance of the reference made by the State Government, under Section 4-K of U.P. Industrial Disputes Act, 1947.
2. Counter and rejoinder-affidavits have been exchanged in all the writ petitions, with consent of the parties the writ petitions are being finally decided by this common judgment.
3. Writ Petition No. 46578 of 2003 arises out of Adjudication Case No. 4 of 1998 with which case several other adjudication cases were consolidated by the order of the Labour Court and Adjudication Case No. 4 of 1998 was treated to be leading case. Facts and evidence of Adjudication Case No. 4 of 1998 are being noted in detail to appreciate and decide the issues raised in these cases.
4. Heard Sri Dhananjay Awasthi learned Counsel appearing for the petitioners in all the writ petitions, Smt. Suman Sirohi appearing for the workman in Writ Petition No. 46578 of 2003 and in some other writ petitions and Sri G.R. Jain appearing for the workman in Writ Petition No. 46453 of 2003 and in some other writ petitions.
5. Writ Petition No. 46578 of 2003 challenges the award dated 17th July, 2003 given by the Labour Court in Adjudication Case Nos. 4 of 1998, 84 of 1996, 5 of 1998 and 13 of 1998.
6. A reference was made by the Deputy Labour Commissioner vide letter dated 17th July, 1996 to the Labour Court as to whether the action of the employers in terminating the services of Rishi Pal Singh, Chowkidar, with effect from 27th August, 1995 was valid or not and if not then to what relief the workman is entitled for. Written statement was filed by the workman as well as the employer. The case of workman in the written statement was that U.P. Forest Corporation is a public Corporation, which is industry within the meaning of U.P. Industrial Disputes Act, 1947 (hereinafter referred to as the Act). Respondent No. 2 was engaged on 7th November, 1983 as Chowkidar and he worked thereafter in every year. In the seniority list of workmen his name was at Serial No. 83. The workman received letter dated 26th June, 1995 proposing to retrench his services with effect from 27th June, 1995. The workman was not given one month notice, nor given any retrenchment compensation. There was no compliance of Section 25M. Respondent No. 2 was a senior workman whereas several junior workmen were retained violating the principle of last come first go. A written statement was filed by the employer in which it was stated that in lieu of one month notice one month salary and retrenchment compensation was given to the workman which was accepted by the workman. It was further stated that workman has utilised the compensation. It was also stated that the workman is employed in gainful employment. On behalf of the employer, statement of one witness, namely, Kedar Singh Chauhan, was recorded who in his examination-in-chief stated that workman was a daily wager and was not made permanent, due to lessening of work the retrenchment was done. The workman was paid retrenchment compensation, which has been utilised by him, and no objection was raised by the workman against his retrenchment. The Corporation is in bad financial position. In his cross-examination he stated that he himself did not participate in the retrenchment proceedings. On behalf of the workman, statement of Rishi Pal, who in his examination-in-chief stated that employers have not fully complied the provisions of Section 6N of the Act and juniors have been retained and senior has been terminated. In his cross-examination, the workman stated that retrenchment compensation was received by post, which he and his co-workers have utilised. The workman also filed Photostat copy of certain documents along with list dated 16th January, 2002 containing certain letters of the employers and seniority list. The Labour Court vide its award dated 30th July, 2003 declared the termination violative of Section 6N of the Act. The Labour Court also observed that it is matter of surprise that juniors have been retained, whereas senior has been retrenched. On the aforesaid findings, the termination was held to be illegal and workman was treated to be in continuous service and was reinstated with full back wages. Similar awards were given in Adjudication Case Nos. 84 of 1996, 5 of 1998 and 13 of 1998.
7. In other writ petitions also, similar awards have been challenged declaring the termination illegal and reinstating the workmen with full back wages, e.g., in Writ Petition No. 46453 of 2003, U.P. Forest Corporation and Anr. v. Presiding Officer, Labour Court, Uttar Pradesh, Rampur and Ors., the award was given by Labour Court holding that workman has worked for 240 days and termination of his services was against the law.
8. Learned Counsel for the petitioners, challenging the awards, raised following submissions :
(i) U.P. State Forest Corporation is, hot covered by definition of word "industry" as contained in the Act. Reference made by the Labour Court was without jurisdiction. The provisions of the Act were not attracted.
(ii) One month salary in lieu of one month notice and retrenchment compensation was given to the workman and the Labour Court having itself recorded finding that workman has certainly received retrenchment compensation, has committed error in declaring the termination violative of Section 6N of the Act. No reasons have been given by the Labour Court for holding that provisions of Section 6N have not been followed. It has not been stated in the award that which part of provisions of Section 6N has been violated.
(iii) There was no violation of principle of last come first go. The seniority list which was filed by the workman was not a seniority list on the basis of which retrenchment was affected. The Photostat copy of the seniority list filed by the workman was an old list. There was several mistakes in the list filed by the workman. There is no consideration or finding that juniors to the workman have been retained, only a sweeping conclusion has been recorded.
9. Smt. Suman Sirohi, appearing for the workman replying the submission of counsel for the petitioners, contended that activities of the U.P. Forest Corporation is well within the meaning of industry as defined in the Act. The provisions of Section 6N of the Act was not fully complied by the employer. No details of compliance of Section 6N of the Act has been given by the employer. The employer did not lead any evidence before the Labour Court except the statement of Kedar Singh Chauhan. Various letters filed in this writ petition were not brought before the Labour Court, hence they cannot be looked into by this Court. It has been contended that juniors were retained and there was violation of provisions of Sections 6P and 6Q of the Act.
10. Sri G.R. Jain, learned Counsel for workmen in some of the writ petitions, contended that even after accepting the retrenchment compensation the workman has right to challenge the retrenchment. He further contended that U.P. Forest Corporation is an industry within the meaning of the Act.
11. Counsel for both the parties relied on various decisions which shall be referred to while considering the respective submissions.
12. The first submission of counsel for the petitioners is with regard to applicability of the Act on the ground that U.P. Forest Corporation is not an industry. Reliance has been placed on judgment of the Apex Court in State of Gujarat and Ors. v. Pratamsingh Narsinh Parmar, 2001 (2) ESC 307 (SC). The counsel for the workman on the other hand, submitted that Forest Corporation is involved in activity, which is covered by definition of industry. Reliance has been placed on judgment of the Apex Court in Corporation of the City of Nagpur v. Its Employees, AIR 1960 SC 675; State of Bombay and Ors. v. Hospital Mazdoor Sabha and Ors., AIR 1960 SC 61O; Bangalore Water Supply and Sewerage Board v. R. Rajappa, AIR 1978 SC 548 and Chief Conservator of Forests and Anr. v. Jagannath Maruti Kondhare, AIR 1996 SC 2898.
13. The definition of word industry as given in U.P. Industrial Disputes Act, 1947 is similar to the definition as given in Industrial Disputes Act, 1947. The Constitution Bench in Bangalore Water Supply's case (supra) considered various aspects of word 'industry' and the test was laid down by the Apex Court in following words :
"(a) Where a complex of activities, some of which qualify for exemption, others not, involves employees on the total undertaking, some of whom are not 'workmen' as in the University of Delhi case (AIR 1963 SC 1873) or some departments are not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the services and the integrated nature of the departments as explained in the Corporation of Nagpur, AIR 1960 SC 675, will be true test. The whole undertaking will be 'industry' although those who are not 'workmen' by definition may not benefit by the status.
(b) Notwithstanding the previous clauses, sovereign functions, strictly understood, alone qualify for exemption, not the welfare activities or economic adventures undertaken by Government or statutory bodies.
(c) Even in departments discharging sovereign functions, if there are units which are industries and they are substantially severable, then they can be considered to come within Section 2 (j).
(d) Constitutional and competently enacted legislative provisions may well remove from the scope of the Act categories which otherwise may be covered thereby."
(It may be stated that it is in pursuance to what was stated under (d) above that the aforesaid amendment of 1982 was made which provided for exclusions of some categories, one of which is "any activity of the Government relatable to the sovereign functions of the Government including all the activities carried on by the departments of the Central Government dealing with defense research, atomic energy and space." This is exception No. (6) of the 9 mentioned in the amended definitions).
14. The three Judges Bench in Chief Conservator of Forest's case (supra) had occasion to consider the nature of work being undertaken by the Forest Department with regard to social forestry. Considering the activity, in the above case, the Apex Court held that it cannot be regarded as a part of inalienable or inescapable function of the State and the word scheme undertaken by the Forest Department cannot be regarded as part of sovereign function. Paragraphs 13 and 17 of the said judgment is quoted below :
"13. The aforesaid shows that if we were to extended the concept of sovereign function to include all welfare activities as contended on behalf of the appellants, the ratio in Bangalore Water Supply case (AIR 1978 SC 548) would get eroded, and substantially. We would demur to do so on the face what was stated in the aforesaid case according to which except the strictly understood sovereign function, welfare activities of the State would come within the purview of the definition of industry; and, not only this, even within the wider circle of sovereign function, there may be an inner circle encompassing some units which could be considered as industry if substantially severable.
17. This being the position, we hold that the aforesaid scheme undertaken by the Forest Department cannot be regarded as a part of sovereign function of the State, and so, it was open to the respondents to invoke the provisions of the State Act. We would say the same qua the social foresting work undertaken in the Ahmednagar district. There was, therefore, no threshold bar in knocking the door of the Industrial Courts by the respondents making a grievance about adoption of unfair labour practice by the appellants."
15. The Apex Court in the case of Corporation of the City of Nagpur (supra), while considering the definition of word 'industry', held that Forest Department of the Nagpur Corporation engaged in welfare activities, are covered by Industrial Disputes Act, 1947. In State of Bombay's case (supra), the Apex Court held that activity of hospital is an industry within the meaning of the Industrial Disputes Act, 1947. The Apex Court observed that definition is an inclusive definition which denote extension and cannot be treated as restricted in any sense. Much reliance has been placed by counsel for the petitioners in State of Gujarat's case (supra). In the aforesaid case, the Court was considering termination of Clerk of Forest Department. The services of the Clerk of the Forest Department were governed by service rules, namely, Clerks-Typists and Typists (Direct Recruitment Procedure) Rules, 1970. The above judgment is not attracted in the facts of the present case since present is not a case of Forest Department of the State Government, rather petitioner is a Forest Corporation which is engaged in activities which activities cannot be treated to be sovereign activities so as to carve an exception as laid down in Bangalore Water Supply's case (supra). The judgment in State of Gujarat's case (supra) is not attracted in the facts of the present case.
16. The petitioners, in paragraph 5 of the writ petition, themselves, have stated that it is engaged in maintenance of felling of trees and selling of timber. The activities, as stated in paragraph 5 of the writ petition, do not cover the petitioners' activity in expected category. The activities being welfare activities undertaking by the Corporation, the petitioners' corporation is fully covered by definition industry and the first submission of counsel for the petitioners cannot be accepted.
17. The second and third submissions of the petitioners are being taken together. In award dated 30th July, 2003, the Labour Court while holding the termination as illegal, recorded following findings :
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18. The Labour Court noted the contention of the employer that the retrenchment of the workman was done in accordance with Section 6N of the Act. The Labour Court further observed that certainly the workman has received compensation. The contention of the workman that retrenchment compensation was sent by post has also been noted. Section 6N of the Act is quoted below :
"6N. 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 :
Provided that no such notice shall be necessary if the retrenchment is under an agreement which specifies a date for the termination of service;
(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 service or any part thereof in excess of six months, and
(c) notice in the prescribed manner is served on the State Government."
19. The Labour Court has not recorded any finding as to which part of provisions of Section 6N of the Act has not been complied with. No findings have been recorded that one month notice or one month pay in lieu thereof has not been given. With regard to retrenchment compensation, there is observation of the Labour Court that workman has certainly received retrenchment compensation. The Labour Court further notes the contention of the workman that retrenchment compensation was sent by post.
20. Smt. Suman Sirohi, learned Counsel for the workman, has much emphasized that no evidence was led by the employer to prove that retrenchment compensation was given to the workman. As noted above, the employers have pleaded that one month pay in lieu of notice and retrenchment compensation was given to the workman which was utilised by him. The witness of the Employer in his examination-in-chief supported the above pleading. However, in cross-examination, he stated that he did not participate in the retrenchment proceeding. On behalf of the workman only one witness, namely, Rishi Pal, was examined. Rishi Pal in his statement before the Labour Court clearly admitted in his cross-examination that retrenchment compensation was sent by post which was utilised by him and his co-workers. The workman, thus, admitted receiving of retrenchment compensation before the Labour Court and on the basis of the said admission, the Labour Court has observed that retrenchment compensation has been received. In the present writ petition a counter affidavit has been filed by the workman. In paragraph 11 of the counter-affidavit this much is admitted that one month salary was paid to the workman-respondent but in the counter-affidavit it has been denied that retrenchment was paid. Relevant portion of paragraph 11 of the counter-affidavit is extracted below :
"11. That the contents of paragraph 11 of the writ petition are admitted to the extent that one month salary was paid to the respondent workman. But they have not been paid the retrenchment compensation which is condition precedent under Section 6N of the U.P. Industrial Disputes Act."
21. There being evidence on record that retrenchment compensation was received by the workman which was also noted by the Labour Court, no basis has been given in the award as to which part of provisions of Section 6N has been violated. From the findings of the Labour Court, as noted above, it is clear that neither any reason has been given by the Labour Court, nor there is consideration of any pleading or evidence on the record. There cannot be any dispute that non-compliance of Section 6N of the Act shall vitiate the retrenchment, but Labour Court has to record a finding regarding non-compliance of Section 6N. In the present case, when the workman has admitted in his oral evidence that retrenchment compensation was received by him, the burden lies on the workman to prove that compensation paid, was not in accordance with Section 6N of the Act. The Labour Court erred in declaring the termination illegal on the aforesaid finding. There is no proper consideration of material on record while holding that provisions of Section 6N of the Act have not been complied. The Labour Court ought to have considered the pleadings and evidence, and then recorded finding as to which part of provisions of Section 6N of the Act has not been complied with. Without there being any finding as to which part of Section 6N of the Act has not been complied merely recording a conclusion that Section 6N of the Act has not been complied with, the award is unsustainable.
22. Similarly, while considering the case of the workman regarding non-compliance of Sections 6P and 6Q of the Act, only one line conclusion has been recorded by the Labour Court that it is a matter of surprise that juniors have not been retrenched, whereas senior has been retrenched. The Labour Court has not referred to any material or evidence on the record to come to the said conclusion.
23. Although the petitioner has filed certain documents in this writ petition to emphasize that Sections 6P and 6Q of the Act were not violated, but as rightly contended by counsel for the workman relying on judgment of Apex Court in Karnani Properties Ltd. v. State of West Bengal, 1990 Lab IC 1677, that High Court should not generally take into consideration materials which were not before the Tribunal. In view of the above, it is not necessary for this Court to consider various letters/documents which were filed by the petitioners in this writ petition and were not before the Labour Court.
24. Sri G.R. Jain learned Counsel appearing for workman in some of the writ petitions, relied on judgment of the Apex Court in All India Radio v. Santosh Kumar and Anr., AIR 1998 SC 941; and Nar Singh Pal v. Union of India and Ors., AIR 2000 SC 1401. In All India Radio's case (supra), the Apex Court considered the question regarding definition of word industry which has already been discussed while considering the first submission. In Nar Singh Pal's case (supra), the Apex Court laid down that encashment of cheque by retrench employee does not debar him from challenging the order terminating his services. There cannot be any dispute with the proposition laid down by the Apex Court in the above case. Despite workman having received the cheque of retrenchment compensation he can contend that retrenchment compensation was not paid in accordance with Section 6N of the Act. In the present case, there is no finding of the Labour Court that retrenchment compensation received by the workman is not in accordance with Section 6N of the Act. In above view of the matter, the question of violation of Section 6N of the Act as well as Section 6P and Section 6Q require fresh consideration by the Labour Court.
25. In result, the awards of the Labour Court impugned in the writ petitions are quashed. The matter is remanded to the Labour Court for a fresh decision. The question that Corporation is an industry has already been considered in this judgment, the Labour Court shall consider the other submissions of the parties apart from above. It will be open for both the parties to lead any further evidence in support of their claim subject to permission of the Labour Court. Looking to the facts and circumstances of the present cases, the Labour Court is directed to decide the cases expeditiously, preferably, within a period of six months from the date of production of a certified copy of this judgment.
26. All the writ petitions are disposed of accordingly.