Delhi High Court
Municipal Corporation Of Delhi vs Shri Ramu Singh And Another on 8 December, 2010
Author: Valmiki J. Mehta
Bench: Valmiki J.Mehta
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) No. 4939/1998
% 8th December, 2010
MUNICIPAL CORPORATION OF DELHI ...... Petitioner.
Through: Mr. Rahat Bansal,
Advocate for Mrs.
Amita Gupta, Advocate.
VERSUS
SHRI RAMU SINGH AND ANOTHER .... Respondents
Through: Mr. Anuj Aggarwal,
Advocate.
CORAM:
HON'BLE MR. JUSTICE VALMIKI J.MEHTA
1. Whether the Reporters of local papers may be
allowed to see the judgment?
2. To be referred to the Reporter or not?
3. Whether the judgment should be reported in the Digest?
VALMIKI J. MEHTA, J (ORAL)
C.M. No.12223/2010 in W.P.(C) No.4939/1998 I may at the outset note that on the commencement of hearing, the counsel for the workman said that since the present application filed under Section 17B of Industrial Disputes Act, 1947 is pending this Court should decide this application under Section 17B first although the main matter is otherwise ripe for final arguments. I W.P.(C) No.4939/1998 Page 1 of 18 may note that the petition was admitted vide order dated 28.04.2004 after the workman was served and yet he chose not to appear. After Rule was issued the respondent No.1-workman as per the Rules applicable to this Court was served afresh and pleadings were completed thereafter. The matter came up for final hearing in Regular Matters on 22.03.2010 whereafter the application u/s 17 B was filed in September, 2010. Counsel for the applicant sought to place reliance upon the decision of the Division Bench of this Court in the case of Iklash Hussain Vs. M/s. Delhi Transport Corporation 2006 IX AD (Delhi) 187 and para 9 thereof which reads as under:
"9. The learned Counsel for the appellant also made a grievance that the application under Section 17B of the Act has been adjourned to be heard along with the writ petition itself in February, 2007. In our view this is contrary to the law laid down by the Hon'ble Supreme Court in Workmen represented by Hindustan V.O. Corporation Ltd. v. Hindustan Vegetables Oils Corporation (2000) 9 SCC 534 (supra), and a Division Bench of this Court in a judgment dated 8th September, 2006 in LPA No. 190/2006 titled Airport Authority of India v. Puran Chand and Ors. (supra) has held by applying the ratio of the Hon'ble Supreme Court in above decision of the Supreme Court that the Section 17B application should be disposed of with great promptitude and before the disposal of the writ petition. Paragraphs 2 and 3 of the said judgment of the Hon'ble Supreme Court read as follows:
2. The order under challenge has been passed by a Division Bench of the High Court at Calcutta. Its operative portion states that the writ petition filed by the present appellants and their application under Section 17B of the Industrial Disputes act should be disposed of together, expeditiously. We are of the view that an application W.P.(C) No.4939/1998 Page 2 of 18 under Section 17B should be disposed of before the principal petition and it should be disposed of most expeditiously.
3. We, thereforee, set aside the order under challenge to the extent that it requires the disposal of the writ petition and the Section 17B application together and we direct that Section 17B application should be disposed of with great promptitude and before the disposal of the writ petition."
In the facts of the present case, I am unable to agree with the contention of the counsel for the respondent/workman in this regard. At this stage, merely because an application has been filed under Section 17B cannot mean that the Court should not hear the main petition when the workman in execution of the impugned Award has already received substantial amounts at different points of time in different years aggregating to a total of about Rs. 3,30,000/-. Thus it is not that the workman has not got the benefit under the Award. In fact the workman had concealed the factum of having received the abovesaid amount pursuant to the Award in this application u/s 17 B where an impression has been given that he has not received any amount at all which conduct amounts to an abuse of the process of law. This court, is therefore, proceeding to dispose of the main petition and this application is dismissed.
W.P.(C) No.4939/1998
1. By the present writ petition under Article 226 of the W.P.(C) No.4939/1998 Page 3 of 18 Constitution of India, the petitioner Municipal Corporation of Delhi seeks quashing of the Award dated 15.10.1996 passed by the Labour Court directing reinstatement with full back wages to the workman- respondent No.1.
2. The facts of the case are that respondent/workman was appointed as a Mali/Beldar as a casual daily wager on 26.4.1983. His services were terminated on 22.10.1984 without assigning any reason. The workman had therefore worked for about one and half years. It could not be argued with any conviction on behalf of the petitioner that the termination of the workman was not wrongful and that the provision of Section 25F was actually not complied with. Clearly, therefore, termination of the workman was in violation of provision of Sections 2(oo) and 25F of the Industrial Disputes Act, 1947.
3. The only issue, however, which has been urged on behalf of the petitioner is that reinstatement is not automatic more so with respect to a casual labour who had worked just for about 18 months and compensation ought to have been an adequate remedy in a case such as the present.
4. It is also argued that the workman in spite of receiving minimum wages over different years after the Award has not worked for the petitioner. It is a fact agreed to by the counsel for the workman that the workman has till date received approximately an amount of W.P.(C) No.4939/1998 Page 4 of 18 Rs.2,58,985/- plus Rs.25,693/- plus Rs.20,346/- plus Rs.22,746/- at least. Possibly certain other amounts may have also been received which the counsels are not able to immediately verify. Therefore, the workman has, without putting in any work since he was terminated in the year 1984, received an amount of Rs.3,30,000/-.
5. The counsel for the workman has argued two points before this Court. The first point is that this Court should not interfere with the decision of the Labour Court in exercise of its discretion under Article 226 of the Constitution of India. The second argument is predicated upon a recent judgment of the Supreme Court reported as Ramesh Kumar Vs. State of Haryana 2010 II AD (SC) 333 that the workman was and is entitled to reinstatement with full back wages.
6. So far as the issue with regard to exercise of jurisdiction under Article 226 of the Constitution of India is concerned, I am of the firm view that no doubt exercise of this power is discretionary, however, it is well settled that this power has to be exercised to further the ends of justice and the ends of justice for the reasons given below require allowing of the petition. The workman‟s wages on the date of termination were the applicable minimum wages being approximately Rs.354/- as informed to this Court by the counsel for the workman. In law it was always open to the petitioner to legally terminate the services of the workman complying with Sections 2(oo) and Section W.P.(C) No.4939/1998 Page 5 of 18 25F by giving one month notice and 15 days pay for each year of completed service. In this case, the petitioner by complying with the requirements of Sections 2(oo) and Section 25F at best, would have been liable to pay the workman a sum of Rs.700/-. Because of the fault of the petitioner, and which indeed pains this Court because the petitioner is a corporation who has with it public monies, the fact of the matter is that workman has received about Rs.3,30,000/- till date pursuant to the impugned Award. The issue is comparison between Rs.700/- which would have been paid because the petitioner was well entitled to terminate the services of a casual labour after complying with Section 25F and the substantial amount of Rs.3,30,000/- received by the workman for which he has given no work in return. I may note that during the course of arguments in this case and on the last two dates of hearings it was put to the counsel for the workman that the workman can take the amount of Rs.3,30,000/- in full and final satisfaction, however, the counsel for the workman, on instructions, states that the workman still wishes to press his case.
7. This Court is persuaded to Award compensation by setting aside the Award for reinstatement with full back wages in the facts and circumstances of the present case which include the factum of the workman having worked only for 18 months, not having worked thereafter with the petitioner for a long period of 26 years and more W.P.(C) No.4939/1998 Page 6 of 18 so in spite of receiving minimum wages, entitlement of the petitioner to legally terminate the services of the workman on paying about Rs.700/-, the employment of the workman not being through regular modes of employment and the recent trends as found in the judgments of the Supreme Court under Section 25F.
There is also nothing appearing in the record that workman during this period was not gainfully employed elsewhere. Of course, it is the duty of the petitioner to point out whether the workman was gainfully employed however that cannot exempt the workman to be fair and honest and state as to whether he was gainfully employed during this long period of over 26 years since the date of his termination. All I can say is that the workman is not such a rich person that he could have afforded to sit at home and not worked at all.
8. I have recently had an occasion to consider the issue of reinstatement of a workman in case the workman before retrenchment has not worked for a long period of time in the case of M/S Genesis Printers VERSUS Shri Rati Ram Jatav Presiding Officers & Ors. W.P.(C) No.61/1997 decided on 27.10.2010, where this Court also referred to the recent developments pertaining to Section 25F as emerging from a catena of judgments of Supreme Court. It would be useful, at this stage, refer to certain paragraphs of W.P.(C) No.4939/1998 Page 7 of 18 the said judgment and which deal with the issue. These paras are paras 9 and 10 and the same read as under:-
"9 . A lot of water has flown since the early 80‟s when reinstatement was considered to be automatic and a matter of right on account of violation of Section 25-F. There are atleast now a few dozen judgments of the Supreme Court that reinstatement is not automatic and facts of each case have to be seen as to whether reinstatement should be granted or compensation is an adequate remedy. Various factors such as the industry in question, financial capacity of the employer, peculiar circumstances of each case, the nature and period of employment and so on have to be seen. In a recent judgment in the case of Incharge Officer and Anr. Vs. Shankar Shetty 2010 (8) Scale 583, the Supreme Court has referred to its various earlier judgments and has held that reinstatement is not automatically a matter of right because of violation of Section 25 F. Paras 2 and 3 of this judgment are relevant and the same read as under:-
"2. The only question to be considered in this appeal by special leave is with regard to the relief of reinstatement granted to the respondent by the Single Judge of the High Court of Karnataka in his judgment and order dated August 13, 2001 and affirmed by the Division Bench vide its judgment and order dated December 9, 2004 in the writ appeal. Should an order of reinstatement automatically follow in a case where the engagement of a daily wager has been brought to end in violation of Section 25F of the Industrial Disputes Act, 1947 (for short „ID Act‟)? The course of decisions of this Court in recent years has been uniform on the above question. In the case of Jagbir Singh v. Haryana State Agriculture Marketing Board and Anr, delivering the judgment of this Court, one of us (R.M.Lodha, J.) noticed some of the recent decisions of this Court-namely, U.P.State Brassware Corporation Ltd. & Anr. V. Uday Narain Pandey; Uttranchal Forest Development Corporation vs. M.C. Joshi; State of M.P.& Ors v. Lalit Kumar Verma; Madhya Pradesh Admn v.W.P.(C) No.4939/1998 Page 8 of 18
Tribhuban; Sita Ram & Ors. V. Motil Lal Nehru Farmers Training Institute; Jaipur Development Authority v. Ramasahai & Anr; Ghaziabad Development Authority & Anr. v. Ashok Kumar & Anr. and Mahboob Deepak v. Nagar Panchayat, Gajraula & Anr. and stated as follows:
"It is true that the earlier view of this Court articulated in many decisions reflected the legal position that if the termination of an employee was found to be illegal, the relief of reinstatement with full back wages would ordinarily follow. However, in recent past, there has been a shift in the legal position and in a long line of cases, this Court has consistently taken the view that relief by way of reinstatement with back wages is not automatic and may be wholly inappropriate in a given fact situation even though the termination of an employee is in contravention of the prescribed procedure. Compensation instead of reinstatement has been held to meet the ends of justice. It would be, thus, seen that by a catena of decisions in recent time, this Court has clearly laid down that an order of retrenchment passed in violation of Section 25-F although may be set aside but an award of reinstatement should not, however, be automatically passed. The award of reinstatement with full back wages in a case where the workman has completed 240 days of work in a year preceding the date of termination, particularly, daily wagers has not been found to be proper by this Court and instead compensation has been awarded. This Court has distinguished between a daily wager who does not hold a post and a permanent employee".
3. Jagbir Singh has been applied very recently in the case of Senior Superintendent Telegraph (Traffic) Bhopal v. Santosh Kumar Seal & Ors. (Civil Appeal No. 3815 of 2010) decided on April 26,2010 wherein this Court stated:
W.P.(C) No.4939/1998 Page 9 of 18
"In view of the aforesaid legal position and the fact that the workmen were engaged as daily wagers about 25years back and they worked hardly for 2 or 3 years, relief of reinstatement and back wages to them cannot be said to be justified and instead monetary compensation would subserve the ends of justice."
The learned counsel for the petitioner has also relied upon the case of Jagbir Singh Vs. Haryana State Agriculture Marketing Board and Anr.
MANU/SC/1213/2009 and in which the Supreme Court has held that reinstatement is not automatic. Paras 3, 6, 7, 8 and 12 of the said judgment are relevant and the same read as under:-
"3. The Presiding Officer, Industrial Tribunal- cum-Labour Court, Panipat, after recording evidence and hearing the parties held that the appellant had worked for more than 240 days in the year preceding the date of termination and that the Respondent No. 1 violated the provisions of Section 25F of the Act 1947 by not giving him notice, pay in lieu of notice and retrenchment compensation before his termination. The Labour Court, accordingly, vide its award dated September 16, 2005 declared that the appellant was entitled to reinstatement with continuity of service and full back wages from the date of demand notice, i.e., January 27, 1997.
6. The learned Counsel for the appellant strenuously urged that once the termination of service of the appellant was held to be in violation of Section 25F of the Act 1947, the Labour Court rightly ordered reinstatement with continuity of service and full back wages and the High Court was not justified in interfering with the just award passed by the Labour Court. On the other hand, the learned Counsel for the W.P.(C) No.4939/1998 Page 10 of 18 respondents supported the order of the High Court.
7. It is true that earlier view of this Court articulated in many decisions reflected the legal position that if the termination of an employee was found to be illegal, the relief of reinstatement with full back wages would ordinarily follow. However, in recent past, there has been a shift in the legal position and in long line of cases, this Court has consistently taken the view that relief by way of reinstatement with back wages is not automatic and may be wholly inappropriate in a given fact situation even though the termination of an employee is in contravention to the prescribed procedure. Compensation instead of reinstatement has been held to meet the ends of justice.
8. In U.P. State Brassware Corporation Ltd. v. Uday Narain Pandey MANU/SC/2321/2005:
(2006)ILLJ496SC , the question for consideration before this Court was whether direction to pay back wages consequent upon a declaration that a workman has been retrenched in violation of the provisions of the Section 6N of the U.P. Industrial Disputes Act, 1947 (equivalent to Section 25F of `the Act, 1947') as a rule was proper exercise of discretion. This Court considered a large number of cases and observed thus:
The Industrial Courts while adjudicating on disputes between the management and the workmen, therefore, must take such decisions which would be in consonance with the purpose the law seeks to achieve. When justice is the buzzword in the matter of adjudication under the Industrial Disputes Act, it would be wholly improper on the part of the superior courts to make them apply the cold letter of the statutes to act mechanically. Rendition of justice would bring within its purview giving a person what is W.P.(C) No.4939/1998 Page 11 of 18 due to him and not what can be given to him in law. (para 41) A person is not entitled to get something only because it would be lawful to do so. If that principle is applied, the functions of an Industrial Court shall lose much of their significance.(para 42) The changes brought about by the subsequent decisions of this Court, probably having regard to the changes in the policy decisions of the Government in the wake of prevailing market economy, globalisation, privatisation and outsourcing, is evident.(para 43) .....
12. In this case, the Industrial Court exercised its discretionary jurisdiction under Section 11A of the Industrial Disputes Act. It merely directed the amount of compensation to which the respondent was entitled had the provisions of Section 25F been complied with should be sufficient to meet the ends of justice. We are not suggesting that the High Court could not interfere with the said order, but the discretionary jurisdiction exercised by the Industrial Court, in our opinion, should have been taken into consideration for determination of the question as to what relief should be granted in the peculiar facts and circumstances of this case. Each case is required to be dealt with in the fact situation obtaining therein."
(Emphasis added)
10. A reading of the aforesaid judgment in the case of Incharge Officer (supra) and also various other judgments which have been referred to show that the reinstatement is not automatic and the facts and circumstances of each case have to be examined by the court. The learned counsel for the respondent sought to place reliance upon Harjinder Singh Vs. Punjab State W.P.(C) No.4939/1998 Page 12 of 18 Warehousing Corporation MANU/SC/0060/2010 to contend that this court should not interfere with the exercise of discretion by the labour court for granting reinstatement in service. I do not find that the reading of the judgment shows that the decisions referred to in the case of Incharge Officer (supra) are said to have laid down the incorrect law. Whether or not reinstatement is to be granted or only a compensation should be granted is surely in the realm of facts of each case, a legal position which is not disputed even by the counsel for the respondent. And, in the facts of this case, as already stated, the Labour Court had no occasion to examine the issue as to whether compensation should be granted instead of reinstatement as the Award is an ex parte Award."
9. So far as argument on the basis of the judgment in the case of Ramesh Kumar (supra) is concerned, I do not find that the said judgment in any manner holds that compensation ought not to be awarded and that the relief of reinstatement with full back wages ought to be granted in all cases.
10. Accordingly, I find that in the facts and circumstances of this case although the workman has been wrongly retrenched from service, the workman should be only entitled to compensation instead of reinstatement with full back wages considering inter alia the fact that his period of work was not long being only of one and half years and that too 26 years back. The impugned Award is thus set aside to the extent it directs reinstatement with full back wages.
11. The issue then to be decided is what should be the amount of compensation which ought to be paid to the workman.W.P.(C) No.4939/1998 Page 13 of 18
The fact is that the workman has not reported for work to the petitioner and has kept on receiving minimum wages over these years after the Award. Surely, fairness and honesty is not a one way street. It applies to all classes and all stratas of the society. It cannot be said that the provisions of Industrial Disputes Act can be used so as to further injustice and enable persons to make huge amounts of money without really working for the amount which they are receiving and although they possibly may be gainfully employed elsewhere or having other sources of income. Considering that for valid termination under Section 25F an amount of Rs.700/- approximately would have been payable, and applying maximum multiplier to such amount, an amount of Rs. 50,000/- in my opinion is adequate compensation which ought to be payable to the workman.
12. The next aspect to be considered is what should happen to the amount which the workman has received in excess of the compensation he ought to receive. In case of Genesis Printers (supra), I had considered the issue whether the amount received by the workman under Section 17B should or should not be directed to be refunded back in case the management succeeds. In this W.P.(C) No.4939/1998 Page 14 of 18 regard, after considering various aspects this Court made the following observations in the said judgment:
"12. The issue then arises is what should happen to the excess amount received by the workman pursuant to the orders under Section 17-B. Though an order under Section 17B is only an interim order which is subject to the final decision in the case, however, the Supreme Court in the case of Dena Bank Vs. Kirtikumar T.Patel (1999) 2 SCC 106 has held that the payment under Section 17 B is in the nature of subsistence allowance which would not be refundable or recoverable even if the Award is set aside by a higher court. On a careful reading of this judgment, I am of the opinion that this judgment cannot be said to be laying down an intractable position that even if the employee has other sources of income, although he has simultaneously received the payment under Section 17B, even then there can be no recovery of the amount received in excess of the compensation which is finally determined by the Court. The stand as taken on behalf of the petitioner by its counsel is quite fair as it is urged that as long as the Award is set aside, the petitioner is agreeable to not press the issue of recovery of compensation and that whatever amount which stands paid to the respondent /workman should be taken as full and final settlement of dues of the petitioner towards the workman for illegal retrenchment provided of course that the workman did not have other sources of income when he was receiving the payment under Section 17B. The counsel for the petitioner however submits that as per the information received by the petitioner, it is not as if the respondent workman is a poor person and has no source of income except the monies which were paid under Section 17B. The counsel for the petitioner states that the workman in fact owns a premises and he has let out a floor of these premises and is earning rent therefrom. This aspect of course has not been established on record and is also strongly disputed by the learned counsel for the workman.W.P.(C) No.4939/1998 Page 15 of 18
13.The object of the ratio of the judgment of the Supreme Court in the case of Dena Bank (supra) that the workman should not be asked to refund any amount received under Section 17B was because the workman is not a rich person who has various sources of income and his only source of income is the payment that he would be receiving under Section 17B. It is for this purpose, the payment under Section 17B has therefore being categorized "subsistence allowance" by the Supreme Court in Dena Bank's case. Surely, the payment under Section 17B cannot be treated as a subsistence allowance, if the workman is having other sources of income. Accordingly, in the opinion of this court in case, the workman during this period after passing of the order under Section 17B from 1.5.1997 is not having any other source of income except the payment which is received under Section 17B, then the workman will not be bound to refund the amount in excess of Rs.1 lac which has been decided by this court as compensation for illegal termination, however, in case during the said period if the workman has other additional source(s) of income including from other employment, then, the workman is bound to refund to the petitioner the amount in excess of Rs.1 lac. I may note that in compliance of the order under Section 17B, the petitioner has been making payments by cheque to the respondent and this amount of cheque is being regularly credited every month in the bank account of the workman/respondent no.2. The respondent/workman is therefore directed within a period of four weeks from the passing of this order to file an affidavit along with copies of his bank accounts that he had no other source(s) of income during the period he received payment pursuant to an order under Section 17B so that there is no need of any recovery from him."
I may note that technically the amount received by the workman in this case is not under Section 17B but in execution of the Award, however the same aforesaid principles would apply as in W.P.(C) No.4939/1998 Page 16 of 18 substance the amount received in execution of the Award will have some colour as the amount received pursuant to an application under Section 17B.
13. I find that the present is accordingly a fit case to direct that the workman should file with an affidavit, his statement of bank accounts right from the year 1984 or from whenever reasonably thereafter the same is available till date and also such other documents to show his income from other sources during this period of 26 years. This affidavit be filed within a period of two months from today and which must also state he had no earnings from alternative employment or sources for the period for which he has received payment from the petitioner. In case the workman has not had any alternative employment or alternative sources of income after reinstatement, then, whatever amount which has been received by the workman till now i.e. approximately Rs.3,30,000/- will be taken as full and final settlement of all the claims of the workman although he has been otherwise only held entitled to compensation of Rs.50,000/-. In case, however it is revealed that the workman had other sources of income including earning from alternative employment, then, since it would be a clear case of workman not acting fair and not revealing the complete facts the W.P.(C) No.4939/1998 Page 17 of 18 compensation which the workman will be entitled to would be only a sum of Rs.50,000/- and then he would be bound to refund a sum of Rs.2,80,000/-to the petitioner and for which the petitioner is free to take all steps in accordance with law to recover this amount from the workman.
The petition stands accordingly disposed of.
DECEMBER 08, 2010 VALMIKI J. MEHTA, J
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W.P.(C) No.4939/1998 Page 18 of 18