Madhya Pradesh High Court
Krishi Upaj Mandi Samiti Pichhoreore ... vs Shiv Kumar Pathak on 29 January, 2026
NEUTRAL CITATION NO. 2026:MPHC-GWL:4156
1 WP-6390-2017
IN THE HIGH COURT OF MADHYA PRADESH
AT GWALIOR
BEFORE
HON'BLE SHRI JUSTICE AMIT SETH
WRIT PETITION No. 6390 of 2017
KRISHI UPAJ MANDI SAMITI PICHHOREORE THR. AND OTHERS
Versus
SHIV KUMAR PATHAK
Appearance:
Shri Shyam Prakash Jain - Advocate for the petitioners.
None for the respondent/workman, though served.
Reserved on : 29/01/2026
Delivered on : 03/02/2026
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ORDER
1. The instant writ petition under Article 226 of the Constitution of India takes exception to the Award dated 22.05.2017 passed by the Presiding Officer, Labour Court No. 2, Gwalior in Case No. 27A/I.D. Act/2017 (Ref.) whereby, the petitioner has been directed to reinstate the respondent-workman with 50% back wages.
2. Briefly stated, the facts of the case are as follows:
2.1 The respondent-workman was engaged as a daily-rated Nakedar on Collector's rate in the establishment of the petitioner-Mandi Samiti on 30.09.1992 and continued to work intermittently till 30.04.1995, that is, when his services were terminated.
2.2 Thereafter, the respondent raised an industrial dispute regarding his Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM NEUTRAL CITATION NO. 2026:MPHC-GWL:4156 2 WP-6390-2017 alleged oral termination dated 30.04.1995, which culminated in an award dated 26.07.2010 passed by the Labour Court directing his reinstatement without back wages, with liberty to the employer to proceed in accordance with law. The said award remained without interference in writ petition vide W.P. No. 6412 of 2012 filed by the respondent - workman. Thereafter, the respondent was reinstated on 01.09.2011 as a daily-rated employee and continued in service till 16.08.2012.
2.3 Subsequently, the petitioner-employer retrenched the respondent from service vide order dated 16.08.2012 after paying retrenchment compensation and one month's wages in lieu of notice as contemplated under Section 25-F of the Industrial Disputes Act, 1947 (hereinafter referred to as "the ID Act, 1947 ").
2.4 Challenging the said retrenchment order, the respondent raised a fresh industrial dispute. Upon failure of conciliation, the dispute was referred for adjudication to the Labour Court No. 2, Gwalior and was registered as Case No. 27A/I.D. Act/2015 (Ref.). Thereupon, the Labour Court, by the impugned award dated 22.05.2017, held the retrenchment dated 16.08.2012 to be illegal on the ground of non-compliance of Section 25-F(c) of the I.D. Act and directed reinstatement of the respondent with 50% back wages.
2.5 Aggrieved by the aforesaid award, the petitioner has approached this Court by way of the present writ petition.
3. The learned counsel appearing for the petitioner submits that the Labour Court No. 2, Gwalior erroneously passed the impugned award as the same suffers from misapplication of Section 25-F of the ID Act, 1947. He further contends that the order of retrenchment dated 16.08.2012 was passed after the mandatory compliance under clauses (a) and (b) of Section 25-F of the ID Act, 1947, as retrenchment compensation and one month's wages in lieu of notice were duly paid to the respondent-workman.Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM
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4. The learned counsel appearing for the petitioner further submits that the finding of the Labour Court holding non-compliance of clause (c) of Section 25-F of the ID Act, 1947 is incorrect as the retrenchment order was duly endorsed to the Labour Commissioner, Labour Department, M.P. Bhopal on the same date, thereby constituting substantial compliance of the statutory requirement. He further submitted that even otherwise, compliance of clause (c) of Section 25-F of the ID Act, 1947 is directory and not mandatory as held by the Apex Court in the case of Pramod Jha and Others vs. State of Bihar and Others, 2003 (4) MPLJ 1 and the same cannot be a ground for setting aside the order of retrenchment dated 16.08.2012.
5. The learned counsel for the petitioner further submits that, in respect of a similarly situated employee of the petitioner, whose services were terminated after due compliance of Section 25F of the ID Act 1947, an award of reinstatement on similar terms and on the same ground was passed by the Labour Court on 24.03.2018. The said award was challenged by the petitioner before this Court in MP No. 2923 of 2018, and vide order 08.11.2024, the said petition was allowed and the similar award passed by the Labour Court was set aside. He further submits that the aforesaid order dated 08.11.2024 in MP No. 2923 of 2018 has been affirmed by the Division Bench of this Court vide order dated 12.09.2025 passed in WA No. 3124 of 2024. He thus submits that the issue involved in the petition stands squarely covered by the aforesaid judgments of this Court.
6. No other point has been pressed by learned counsel for the petitioner.
7. Inspite of service of notice, the respondent-workman chose not the appear before this Court. Thus, none appears for the respondent though served.
8. Heard learned counsel for the petitioner and perused the material Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM NEUTRAL CITATION NO. 2026:MPHC-GWL:4156 4 WP-6390-2017 available on record.
9. The only point for consideration before this Court is whether non- compliance of clause (c) of Section 25-F of the Industrial Disputes Act, 1947 renders the retrenchment order dated 16.08.2012 illegal, and if not, whether the Labour Court was justified in directing reinstatement with 50% back wages, which aspect stands decided by this Court vide order dated 08.11.2024 passed in M.P. No. 2923 of 2018.
10. The relevant Paras of order dated 08.11.2024 vide MP No. 2923 of 2018 read as follows:
"10. Not only this, at that point of time vide award dated 26-07-2010 liberty was given to the employer to remove the employee if services are not required as per Section 25F of the Act. Therefore, it was a case where employee has to be retrenched but taking care of provisions contained in Section 25F of the Act. Therefore, the whole dispute is to be seen from that perspective also. Employer was given liberty by the labour Court itself. Although employer did not proceeded as per direction of the labour Court but later on course correction was made as per the order dated 29-06-2011 passed by the Division Bench of this Court in Writ Petition No.1513 of 2011. Direction was given to the employer to reinstate the employee first and thereafter had liberty to pass any suitable order. Therefore, exercising that liberty retrenchment order was passed.
11. So far as provisions for non compliance of Section 25F of the Act is concerned, before proceeding further, Section 25F of the Act is worth reproduction:
"25F. 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; (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 continuous service or any part thereof in excess of six months; and (c) notice in the prescribed manner is served on the appropriate Government [or such authority as may be specified by the appropriate Government by notification in the Official Gazette."Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM
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12. The Supreme Court in the case of Pramod Jha and others (supra) held that compliance of clause (c) of Section 25F of the Act is directory and not mandatory . Para 11 of the said judgment is reproduced for ready reference:
"11. Compliance with clauses (a) and (b) of Section 25F strictly as per the requirement of the provision is mandatory. However, compliance with clause (c) is directory, as held in Gurmail Singh and Ors. Vs. State of Punjab and Ors. (1991) 1 SCC 189 and a substantial compliance would be enough."
13. However in the case of Raj Kumar (supra) two judge Bench of the Apex Court held in para 34 to 39 in following manner:
"34. We are unable to agree with the reasoning adopted by the Tribunal as well as the High Court in the instant case. Admittedly, the notice under Section 25F(c) of the ID Act has not been served upon the Delhi State Government. In support of the justification for not sending notice to the State Government reliance has been placed upon the decision of this Court in the case of Bombay Journalists(supra). This decision was rendered in the year 1963 and it was held in the said case that the provisions of Section 25F
(c) of the ID Act is directory and not mandatory in nature. What has been ignored by the Tribunal as well as the High Court is that subsequently, the Parliament enacted the Industrial Disputes (Amendment) Act, 1964.Section 25F (c) of the ID Act was amended to include the words:
"25-F.(c) .... or such authority as may be specified by the appropriate Government by notification in the Official Gazette".
The statement of objects and reasons provides: "Opportunity has been availed of to propose a few other essential amendments which are mainly of a formal or clarificatory nature"
35. Nothing was done on part of the legislature to indicate that it intended Section 25F(c) of the ID Act to be a directory provision, when the other two sub-sections of the same section are mandatory in nature. The amendment was enacted which seeks to make it administratively easier for notice to be served on any other authority as specified.
36. Further, even the decision in the case of Bombay Journalists(supra) does not come to the rescue of the respondents. On the issue of interpretation of Section 25F(c) of the ID Act, it was held as under:
"12......The hardship resulting from retrenchment has been partially redressed by these two clauses, and so, there is every justification for making them conditions precedent. The same cannot be said about the requirement as to clause
(c). Clause (c) is not intended to protect the interests of the Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM NEUTRAL CITATION NO. 2026:MPHC-GWL:4156 6 WP-6390-2017 workman as such. It is only intended to give intimation to the appropriate Government about the retrenchment, and that only helps the Government to keep itself informed about the conditions of employment in the different industries within its region. There does not appear to be present any compelling consideration which would justify the making of the provision prescribed by clause (c) a condition precedent as in the case of clauses (a) & (b).
Therefore, having regard to the object which is intended to be achieved by clauses (a) & (b) as distinguished from the object which clause (c) has in mind, it would not be unreasonable to hold that clause (c), unlike clauses (a) & (b), is not a condition precedent." (emphasis laid by this Court) Thus, this Court read the ID Act and the relevant Rules thereunder together and arrived at the conclusion that Section 25F(c) is not a condition precedent for retrenchment. By no stretch of imagination can this decision be said to have held that there is no need for industries to comply with this condition at all. At the most, it can be held that Section 25F(c) is a condition subsequent, but is still a mandatory condition required to be fulfilled by the employers before the order of retrenchment of the workman is passed.
37. This Court in the case of Mackinon Mackenzie & Company Ltd. v. Employees Union held as under:
"34.......Further, with regard to the provision of Section 25F Clause
(c), the Appellant-Company has not been able to produce cogent evidence that notice in the prescribed manner has been served by it to the State Government prior to the retrenchment of the concerned workmen. Therefore, we have to hold that the Appellant-Company has not complied with the conditions precedent to retrenchment as per Section 25F Clauses (a) and (c) of the I.D. Act which are mandatory in law."
38. In the instant case, the relevant rules are the Industrial Disputes (Central) Rules, 1957. Rule 76 of the said Rules reads as under:
"76. Notice of retrenchment.- If any employer desires to retrench any workman employed in his industrial establishment who has been in continuous service for not less than one year under him (hereinafter referred to as 'workman' in this rule and in rules 77 and 78), he shall give notice of such retrenchment as in Form P to the Central Government, the Regional Labour Commissioner (Central) and Assistant Labour Commissioner (Central) and the Employment Exchange concerned and such notice shall be served on that Government, the Regional Labour Commissioner (Central), the Assistant Labour Commissioner (Central), and the Employment Exchange concerned by registered post in the Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM NEUTRAL CITATION NO. 2026:MPHC-GWL:4156 7 WP-6390-2017 following manner :- (a) where notice is given to the workman, notice of retrenchment shall be sent within three days from the date on which notice is given to the workman; (emphasis laid by this Court) Rule 76(a) clearly mandates that the notice has to be sent to the appropriate authorities within three days from the date on which notice is served on the workman. In the instant case, the notice of retrenchment was served on the appellant on 07.01.2003. No evidence has been produced on behalf of the respondents to show that notice of the retrenchment has been sent to the appropriate authority even till date.
39. That being the case, it is clear that in the instant case, the mandatory conditions of Section 25F of the ID Act to retrench a workman have not been complied with. The notice of retrenchment dated 07.01.2003 and the order of retrenchment dated 25.07.2003 are liable to be set aside and accordingly set aside."
14. Section 25F(a) of the Act contemplates two contingencies. One is that workman has to be given one month's notice in writing indicating reason for retrenchment and then workman shall be retrenched after expiry of one month's notice period. Another contingency is that if workman has been paid wages for the period of the notice in lieu of such notice then also he can be retrenched.
15. Both these contingencies are distinguished by incorporating the word "OR". In other words if employer gives one month's wages then he can dispense sending of one month's notice in writing. Since dispensation of notice is discretion of employer and if he pays wages for the period of notice and as per Section 25F(b) of the Act if he pays retrenchment compensation also at the time of retrenchment then requirement of notice to the appropriate Government as per Section 25F(c) of the Act would not exist. Notice is to be given to the appropriate Government when employer gives one month's notice in writing to the workman for retrenchment.
16. Once employer decided to pay one month's wages and compensation as per Section 25F(a) and (c) of the Act, then requirement of notice under Section 25F(c) of the Act is not attracted. Any contrary interpretation would impliedly obliterate or omit the word "OR" from the statute book as figured in Section 25F(a) of the Act. That would be contrary to the legislative intent.
17. So far as the judgment of Supreme Court in the case of Pramod Jha and others (supra) is concerned it holds the compliance of clause (c) as Directory whereas the judgment as pronounced in the case of Raj Kumar (supra) holds the compliance to be Mandatory. However, in the case of Raj Kumar (supra), management issued a notice to the workman in accordance with Section 25F(a) of the Act, stating that his services were no longer required by the School and that he would be retrenched from the services on the expiry of notice period of one month. This is not the position here. Workman was given wages of one month (Rs.4395/-) and compensation for retrenchment (Rs.23,257/-) thus totaling Rs.27,612/- to the workman vide order dated 16-08-2012. Therefore, compliance of Section 25F(c) of the Act has little meaning.
Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PMNEUTRAL CITATION NO. 2026:MPHC-GWL:4156 8 WP-6390-2017
18. Although in the present case from the documents filed with the petition it appears that on 16-08-2012 vide outward No.215 order of retrenchment (payment of wages for one month and compensation) was sent to the employee. Similarly vide outward No.216 and 217, it was informed to the Managing Director and Joint Director of the M.P. Agriculture Marketing Board respectively. Further vide outward No.218 copy of the order dated 16-08-2012 was sent to the Labour Commissioner, Bhopal. Said document is filed as Annexure P/4 (exhibited vide Ex-D-2C by DW-1. Therefore, order of retrenchment has been communicated to the appropriate Government.
19. Another ground raised by the employee was in respect of Section 25G of the Act. Section 25G of the Act reproduced for ready reference:
"25G. Procedure for retrenchment.--Where any workman in an industrial establishment, who is a citizen of India, is to be retrenched and he belongs to a particular category of workmen in that establishment, in the absence of any agreement between the employer and the workman in this behalf, the employer shall ordinarily retrench the workman who was the last person to be employed in that category, unless for reasons to be recorded the employer retrenches any other workman."
20. However, in the present case provisions of Section 25G of the Act are not attracted for two reasons; one is employee namely Virendra Singh Parihar who was the employee and working in the establishment of petitioner No.1 Krishi Upaj Mandi Samiti Pichhore on the post of Assistant Sub Inspector of Mandi was a permanent employee working in the regular pay scale on the date of issuance of order of retrenchment dated 16-08-2012. Therefore, being a regular and permanent employee said Virendra Singh Parihar was not similarly situated daily rated employee who was junior to the respondent/workman so as to attract the provisions of Section 25G of the Act. Another ground is that Section 25G of the Act itself gives leverage and liberty to the employer to retrench any workman for the reasons to be recorded. Here, the reason was obvious, liberty given by the labour Court vide its award dated 26-07- 2010. When labour Court itself given the liberty to proceed for retrenchment if desired then it was also one of the reasons for the employer to proceed further for retrenchment. Therefore, on this count also Section 25G of the Act is not attracted. Therefore, the findings (although scantly discussed) given by the labour Court is perverse and contrary to the record.
21. In the case of Dilip (supra) the Coordinate Bench of this Court has held that since M.P. Housing Board is a body corporate constituted under the provisions of the Madhya Pradesh Griha Nirman Mandal Adhiniyam, 1972, therefore, Section 25N of the Act is not applicable over the M.P. Housing Board. Therefore, it is neither a 'factory' as defined under the Factories Act, 1948, nor 'mines' as defined under the Mines Act, 1952, nor 'plantation' as defined under the Plantations Labour Act, 1951. Same is the situation in the present case as Krishi Upaj Mandi Samiti is an entity instituted under the M.P. Krishi Upaj Mandi Adhiniyam, 1972. Even otherwise no pleadings in this regard were made, therefore, case is bereft of merits on this count also.
22. Cumulatively, it appears that the compliance of Section 25F of the Act was made Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM NEUTRAL CITATION NO. 2026:MPHC-GWL:4156 9 WP-6390-2017 and the labour Court earlier vide award dated 26-07- 2010 given liberty to the petitioners for retrenchment and therefore, petitioners retrenched the workman by following due process of law. Even otherwise employee was working in a private school (since 1994-95) during that period and after almost 15 years rose from the slumber and started proceedings in year 2009. Therefore, it suffers from inordinate delay and laches without any explanation.
23. Resultantly, the case of petitioners is made out for interference. Award dated 24- 03-2018 (pronounced on 02-05-2018) passed by Labour Court No.2, Gwalior is hereby set aside and order of retrenchment dated 16-08-2012 is upheld. If the respondent/employee was not gainfully employed and payment has been made by the employer as per Section 17B of the Act then that amount given to the workman shall be governed by Section 17B of the Act and shall not be recovered.
[Emphasis Supplied]
11. The aforesaid judgment has been affirmed by the Division Bench in W.A. No. 3124 of 2024 vide order dated 12.09.2025. The relevant paras of W.A. No. 3124 of 2024 are reproduced herein:
"15. The violation, as alleged by the Workman, is with regard to sub-section (c) of Section 25-F of I.D. Act which provides for giving of notice of retrenchment to Appropriate Government or the authority specified in this regard by Appropriate Government. The records shows that the Employer has given notice of retrenchment to the Labour Commissioner, Bhopal vide communication dated 16.08.2012 which satisfies the requirement of Section 25-F(c) of I.D. Act also. Further, said provision has been held to be directory and not mandatory. The learned Single Judge has placed reliance upon Apex Court judgment in the case of Pramod Jha (supra) while holding that provisions of Section 25F(c) are directory and not mandatory. The similar view was taken by Apex Court in the case of Manju Saxena Vs. Union of India &Anr. reported in (2019) 2 SCC 628 wherein the Apex Court held in para 6.8 & 6.9 as under;
"6.8. In the present case, R-2 Bank has paid the appellant a sum of Rs 8,17,071, which included 6 months' pay in lieu of notice under Section 25-F(a) and an additional amount calculated on the basis of 15 days' salary multiplied by the number of years of service, in compliance with Section 25-F(b).
6.9. However, no notice was sent to the appropriate Government or authority notified, in compliance with Section 25-F(c) of the ID Act. A three-Judge Bench of this Court in Gurmail Singh v. State of Punjab [Gurmail Singh v. State of Punjab, (1991) 1 SCC 189 : 1991 SCC (L&S) 147] held that the requirement of clause (c) of Section 25-F can be treated only as directory and not mandatory. This was followed in Pramod Jha v. State of Bihar [Pramod Jha v. State of Bihar, (2003) 4 SCC 619 : 2003 SCC (L&S) 545] wherein it was held that compliance with Section 25-F(c) is not mandatory."Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM
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16. Thus, it is a settled legal proposition that provisions of Section 25-F(c) are directory and, therefore, learned Single Judge was justified in reversing the finding of Labour Court with regard to violation of Section 25-F of I.D. Act.
xxx-xxx-xxx-xxx-xxx-xxx-xxx-
21. In view of the aforesaid discussion, we are of the view that the learned Single Judge has properly appreciated the facts as also the legal position and is justified in allowing the Misc. Petition.
22. Consequently, the appeal is found to be without any substance and is accordingly, dismissed."
[Emphasis Supplied]
12. In view of the above consideration of facts as well as law settled in the identical case by this Court in MP No 2923 of 2018 vide order dated 08.11.2024, the present petition succeeds and is allowed on the same terms and the award dated 22.05.2017 passed by Labourt Court No. 2, Gwalior is hereby set aside. If the respondent/employee was not gainfully employed and payment has been made by the employer as per Section 17B of the ID Act, 1947 then that amount given to the workman shall be governed by Section 17B of the ID Act, 1947 and shall not be recovered.
(AMIT SETH) JUDGE Van Signature Not Verified Signed by: VANDANA VERMA Signing time: 03-Feb-26 7:15:33 PM