Gujarat High Court
Operations Research Group Employees ... vs State Of Gujarat on 12 September, 2022
Author: A.Y. Kogje
Bench: A.Y. Kogje
C/SCA/138/2017 JUDGMENT DATED: 12/09/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 138 of 2017
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE A.Y. KOGJE
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1 Whether Reporters of Local Papers may be allowed No
to see the judgment ?
2 To be referred to the Reporter or not ? No
3 Whether their Lordships wish to see the fair copy No
of the judgment ?
4 Whether this case involves a substantial question No
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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OPERATIONS RESEARCH GROUP EMPLOYEES UNION
Versus
STATE OF GUJARAT & 2 other(s)
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Appearance:
MS SHIKHA PANCHAL, ADVOCATE for ADITI S RAOL(8128) for the
Petitioner(s) No. 1
MS. SURBHI BHATI, AGP, for the Respondent(s) No. 1
MR. NISARG DESAI, ADVOCATE for GANDHI LAW ASSOCIATES(12275) for
the Respondent(s) No. 2
NOTICE SERVED for the Respondent(s) No. 1,3
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CORAM:HONOURABLE MR. JUSTICE A.Y. KOGJE
Date : 12/09/2022
ORAL JUDGMENT
[1] Rule. Learned advocate Mr. Nisarg Desai waives service of rule on behalf of respondent No.2 and learned Assistant Government Pleader waives service of rule on behalf of respondent-State.
Page 1 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 [2] This petition under Article 226/227 of the Constitution of India is filed against the judgment and award dated
24.05.2016 by the Industrial Tribunal No.3, Vadodara in Reference (IT) No.36 of 2013. The relief is also prayed for directing the respondent company to reinstate the retrenched workmen to their original posts with full back-wages and continuity in service. It is a case where the petitioner union had raised an industrial dispute against 10 workmen of the respondent establishment whose services were terminated on 02.03.2012 by written order without following required procedure and handing over the work to the contract employees. The petitioner is employees' union, which is representing the case of the workmen engaged with respondent company and details of the workmen are at Annexure-A, consisting of 10 workmen.
[3] Learned advocate Ms.Shikha Panchal, appearing for the petitioner has argued that the Industrial Tribunal has not considered the case of the petitioner-Union and while doing so, it has accepted the contention of the respondents that the requirement of workmen was not there on account of rationalization and mechanization. In that eventuality 4 th Schedule of Industrial Disputes Act, 1947 is directly attracted and hence notice under Section 9A of the Industrial Disputes Act, 1947 (for short "the Act") ought to have been issued and hence, in absence of such notice, the action of the respondents would be rendered illegal.
[3.1] Learned advocate thereafter submitted that even if the case of the respondents for retrenchment is accepted, still the Page 2 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 respondents are required to follow the principles of 'last come first go' and that would be evident only if the seniority list is displayed on the notice board which the respondents have not done and therefore, violated the provisions of Section 25G of the Act. It is submitted that the list which is placed on the notice board which the respondents are now relying upon, is a list of those individuals who have been retrenched. The respondents ought to have displayed the list of all the employees in their establishment as per their seniority list and then only it would be evident whether juniors to the retrenched employees were continued or not. Learned advocate has submitted that the nature of work in which the workmen were engaged has continued. The only thing is that the respondents are getting such work done through engaging contract labour. The petitioner has specifically named Shri Rang Enterprise Private Limited, which is hired on contract. It is submitted that the Government in due recognition of retrenchment of services of the workmen without following due process of law which amounted to a criminal offence for this, criminal cases have been filed before the Court of Judicial Magistrate at Vadodara for violating Sections 9A and 25G of the Act. Learned advocate submitted that the workmen have been working for long period with the respondent company, ranging from 16 years to 35 years.
[3.2] Learned advocate has argued that finding given by the Tribunal with regard to the seniority is complete mis- appreciation of evidence as it has proceeded to rely upon the cross examination of one retrenched workman who has deposed that serial number at which his name is appeared and Page 3 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 the date of joining shown in the list of retrenched workmen was correct and thereafter proceeded to hold that the principle of 'last come first go', has been violated. It is submitted that such exercise is incomplete exercise undertaken by the Tribunal. As per the case of the petitioner the list was required to be displayed on the notice board which contained the name of the employees and their respective seniority. It is submitted that the seniority list which has to be prepared as per the Rule 81 of the Bombay Industrial Dispute Rules, which is not complied.
[3.3] Learned advocate on same point has submitted that by citing instances with the Administrative Assistant that one Shri Kailash Patro, whose date of joining was 01.08.1981 was discharged, whereas his junior Shri H.L. Trivedi and Shri Kiran J. Vyas, whose date of joining was in the year 1996-1997 respectively were retained in service. Similarly in case of Shri G.M.Solkar, his date of joining was 01.12.1977 he was retrenched, whereas his junior Shri Ratilal Rana, whose date of joining was 1980 was retained. Despite such material on record, which clearly indicates violation of Section 25G of the Act, the Industrial Tribunal has held that there is no violation of Section 25G of the Act. Learned advocate has drawn attention of this Court to Exh.21 which is the list which, according to the respondents, was displayed.
[3.4] In support of the argument for compliance of Section 9A of the Act being mandatory has relied upon the decision of the Division Bench of Bombay High Court in case of Navbharat, Hindi Daily, Nagarpur v/s. Navbharat Shramik Sangh, Page 4 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 reported in 1984 LAB IC 445. The reliance is also placed on the decision in case of Rajkot Municipal Corporation v/s. Kishor Govind, reported in 1996 (2) GLR 246.
[4] As against this learned advocate appearing for the respondent-company submitted that the Industrial Tribunal has taken into consideration the nature of evidence led by the petitioner-Union and as the petitioner could not establish the fact that the respondents had resorted to rationalization, as a result of which, 10 workmen have been retrenched, has arrived at a correct conclusion that there is no violation of Section 9A of the Act. The petitioner had failed to prove that the retrenchment was on account of rationalization. It is further submitted that Section 9A of the Act is attracted only when change in service condition was covered under 4 th Schedule of the Act. It is submitted that item Nos.10 and 11 of the 4 th Schedule will not be attracted in the facts of this case. Learned advocate submitted that the respondents have violated the principle of 'last come first go' and based on this evidence the Tribunal has arrived at such finding of fact which cannot be interfered with.
[4.1] It is submitted that as matter of fact, the respondents have not engaged the said Shri Rang Enterprise Private Limited as a contractor, but carried out the work for which workmen were engaged. The petitioner-Union was not able to establish that there was commonality of work which was rendered by the retrenched employees with the work performed by the contractor. It is submitted that prior notice was given to 10 workmen and the procedure envisaged for retrenchment has Page 5 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 been followed is evident from the letter dated 02.03.2012 of retrenchment. It is submitted that the petitioner is representing only 10 workmen, whereas the retrenchment was given for approximately 16 workmen, but only 10 have raised an industrial dispute. Learned advocate for the respondents has tried to explain that the workmen which were retrenched were performing the duties of Dispatch Department and the activity of the said Department was closed down entirely. Similarly, some of the workmen who were retrenched were working as peons and their services were also no more required on account of change in policy of the respondents by installing self service vending machines, work for which peons were engaged. It is lastly submitted that the petitioner is not an industry, but is a research organization.
[4.2] Learned advocate has relied upon the decision of this Court in case of Ranjit Natvarlal Chauhan v/s. Morbi Nagar Palika, reported in 2011 (2) GLR 1783 to contend that it is the burden of workmen who claimed that the juniors were retained in service in violation of Section 25G of the Act, if the workman is to claim the benefit of Section 25G of the Act. Reliance is placed on the decision of in case of State Bank of Bikaner and Jaipur, reported in 2006 (5) SCC 123 to submit that even if the seniority list is not maintained, then also violation of Section 25H of the Act has to be independently established. Reliance is also placed upon the unreported decision of Rajasthan High Court in case of Regional M of anager, State Bank of Bikaner and Jaipur, Regional Office, Bikaner v/s. Shri Bhanwar Lal Saini s/o Kashi Ram Saini in Civil Writ (CW) No.5868 of 2004 in support of his Page 6 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 argument that burden of proof lies on the workman to show that any person junior to him has been retained in service.
[5] The Court has heard learned advocates for the parties and perused the documents placed on record. On the part of the respondents, a feeble attempt is made that the provisions of the Industrial Disputes Act is not applicable by considering the nature of work in which the respondent company is involved being of marketing research and not in any manufacturing activity, but by elaborate reasons, the Industrial Tribunal has not considered this contention. Similarly, though initially Section 25N of the Act was invoked by the petitioner, the issue of Section 25N of the Act is not persuaded. According to this Court also, provisions of Industrial Disputes Act would apply as the respondent company would fall in definition of an "industry" as contemplated under Section 25 of the Act and has discussed elaborately in the decision of Supreme Court in case of Banglore Water Supply & Sewerage Board v/s. A. Rajapppa and others, reported in (1978) 2 SCC 213 and the activities of the respondent is falling within the categories of discussed by the Apex Court in the aforesaid judgment. The relevant paras are as under:-
"140. 'Industry, as defined 'in Sec. 2(j) and explained in Banerji (Supra) has a wide import.
I.(a) Where (i) systematic activity, (ii) organized by cooperation between employer and employee (the direct and substantial element is chimerical); (iii) for the production and/or distribution of goods and services calculated to satisfy human wants and wishes (not spiritual or religious, but inclusive of material things or services geared to celestial bliss e.g. making, on a large scale prasad or food), prima facie there is an 'industry' in that enterprise.Page 7 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022
C/SCA/138/2017 JUDGMENT DATED: 12/09/2022
(b) Absence of profit motive or gainful objective is irrelevant, be the venture in the public, joint, private or other sector.
(c) The true focus is functional and the decisive test is the nature of the activity with special emphasis on the employer-employee relations.
(d) If the Organisation is a trade or business it does not cease to be one because of philanthropy animating the undertaking."
[6] The industrial dispute has arisen on account of the services of 16 workmen being brought an end by a letter dated 02.03.2012. Out of 16 employees, 10 workmen have raised an industrial dispute through petitioner union. The first claim of the petitioner union is that the action of terminating the services of the workmen is in violation of Section 9A of the Act. In support of the contention, it was argued that the case of the respondent company was that services of the retrenched employees were no more required as those workmen were engaged in Dispatch Department and such Department has been closed down altogether and some of the workmen were working as peon for attending the visitors and office staff, their work was also no more required as the respondent had installed Tea and Coffee Vending Machines and therefore, their services were no more required. Section 9A of the Act provides for notice of change and no employment can affect any change in the condition of service in respect of any matters specified in the 4th Schedule, without giving notice to the workman regarding such change being affected. The 4 th Schedule specifies the conditions of service for change for which notice is to be given. Item 10 of the 4 th Schedule mentions procedure of rationalization, standardization or improvement of plant or Page 8 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 technique which is likely to led to retrenchment of workmen and therefore, when the respondents resorted to installing of Vending Machines and closing down of the Dispatch Department in view of the development, then it was incumbent upon the respondent company to comply Section 9A of the Act.
[7] It is pertinent to observe admitted evidence on record namely retrenchment letter dated 02.03.2012 in case of one of the workers namely Shri Kailash Parto who was Administrative Assistant and according to this letter issued by the respondent, his main work was of ticket booking and as there was change in the working for the purpose of ticking booking, the service of the workman was no more required and hence, was retrenched and alongwith the retrenchment order, retrenchment compensation in form of cheque was also issued which has been refused. Similarly, in case of G.M.Solkar, working as a Clerk in a Dispatch Department, order of retrenchment indicates that the respondent department has undertaken some changes, as a result of which, the work related to dispatch has been closed down and hence, services were not required. The Court has found that in each of such retrenchment letter reason given by the respondent is that the establishment has brought about some change in the working of the particular Department, as a result of which, the services of the workmen were not required.
[8] Over and above this, the Industrial Tribunal has also recorded that in so far as peons are concerned, their services were not required on account of installing of Vending Machines to serve their staff as well as guest. In the opinion of the Court, Page 9 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 retrenchment letter itself clearly indicates that the company has resorted to the procedure of rationalization and standardization in the respective department, which according to this Court, is covered under item No.10 of 4 th Schedule and hence, notice under Section 9A of the Act would be necessary. The Industrial Tribunal has committed an error in coming to the conclusion that Section 9A of the Act is not attracted and the reasons given by the Industrial Tribunal is only by accepting the version of the respondent company that the work in which the workmen were involved have been closed down.
[9] It is pertinent to observe at this stage that the contention was raised from the beginning with regard to engaging of Shri Rang Enterprise Private Limited for carrying out the work which was being carried out by the workmen and therefore, it was a case of outsourcing of the work which was being performed by the workmen. It would be appropriate to refer to the evidence of the workman Kailsh Patro at Exh.48 who has deposed that Shri Rang Enterprise Private Limited was doing work of Coder and was also engaged in supplying staff to the respondent company. It is only that the witness workman was not able to give the name of the employee of Shri Rang Enterprise who was actually carrying out the work of these workmen. This would not falsify the evidence of a witness to the extent that the work of the retrenched workmen is no more existed in the company, this in the opinion of the Court is mis-appreciation of the evidence by the Industrial Tribunal.
[10] From the evidence on record, it is apparent that the nature of work in which the retrenched workmen were engaged Page 10 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 still existed in the company, but appears to have been outsourced. In that view of the matter, the respondent company has also violated Sections 25G and Section 25H of the Act. The respondent has tried to establish that the seniority list has been followed while retrenching. For that purpose, Exh.21 was the seniority list. From Exh.21, the dates on which the retrenched workmen were respectively employed with the respondent company is clearly indicated and therefore, it is apparent that that the retrenched workmen have been employed way back from 1977 onwards till 1999. Exh.21 in column of remarks indicates against the name of the respective workman as to whether he has been retrenched or retained. In the opinion of the Court, list at Exh.21 is not the complete list of employees, but is the list which only indicates the name of the employees who have been retrenched. The Court is able to conclude that all these workmen have been serving since long before the date on which they were retrenched and the seniority list relied upon by the respondent does not appear to be a seniority list of all the employees. The Court observes that Exh.21 list also indicates that name of some of the workmen who have been retained. For example, the name of G.M.Solkar who was appointed on 12.01.1977 was given designation of Clerk is shown to have resigned, whereas the documents on record would go on to indicate that by letter dated 02.03.2012, Shri G.M.Solkar has been retrenched. Therefore, this seniority list cannot be termed to be a reliable seniority list which is followed and relied upon by the respondent company.
Page 11 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 [11] The Court has therefore, no hesitation to hold that Section 25G of the Act is violated by the respondent. One more example is that one G.R.Patel, who is appointed in the year 1988 has been retained by giving him a nomenclature of General Service Assistant, whereas Shri Kailash Patro, whose appointment is of the year 1981 and giving the nomenclature of Administrative Assistant has been retrenched. This also is of indicative of violation of Section 25G of the Act, which the Industrial Tribunal has failed to consider. The case which is apparent to the Court is that with the act of the respondents by retrenching workmen have engaged the private limited company for supplying of manpower to overcome violation of Section 25H of the Act as the respondent No.2 has resorted to outsourcing of work being carried out by the retrenched workmen. The Court is of the view that this aspect ought to have been considered by the Industrial Tribunal instead of holding that the work in which retrenched workmen have been engaged has been stopped completely.
[12] For the foregoing reasons, the Court finds that the award of the Industrial Tribunal is required to be interfered with and required to be quashed and set aside. Accordingly. , the impugned judgment and order dated 24.05.2016 passed by the Industrial Tribunal No.3, Vadodara in Reference (I.T.) No.36 of 2013 is quashed and set aside. As a consequences, the order of retrenchment dated 02.03.2012 has to be declared as illegal and set aside and the workmen are ordered to be reinstated to their original posts. it would be appropriate to observe that pending the litigation many of the workmen have Page 12 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022 C/SCA/138/2017 JUDGMENT DATED: 12/09/2022 attained the age of superannuation however, with no credible details on the record the court refrains to pass any order in this regards except to observe that in such an individual case the necessary consequence must follow.
[13] In so far as the issue of back-wages is concerned, the Court does not find enough evidence led by the workmen before the Industrial Tribunal regarding their employment or possibility of employment subsequent to the order of retrenchment. Moreover, adopting a principle of "No Work No Pay", the Court is not inclined to pass an order of back-wages.
[14] The petition stands allowed. Rule is made absolute to the aforesaid extent.
(A.Y. KOGJE, J) SIDDHARTH Page 13 of 13 Downloaded on : Thu Sep 15 21:26:18 IST 2022