Gujarat High Court
Operations Research Group Employees ... vs State Of Gujarat on 13 October, 2023
Author: Sunita Agarwal
Bench: Sunita Agarwal, N.V.Anjaria
NEUTRAL CITATION
C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023
undefined
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/LETTERS PATENT APPEAL NO. 276 of 2023
In R/SPECIAL CIVIL APPLICATION NO. 138 of 2017
With
R/LETTERS PATENT APPEAL NO. 507 of 2023
In
R/SPECIAL CIVIL APPLICATION NO. 138 of 2017
With
CIVIL APPLICATION (FOR STAY) NO. 2 of 2023
In R/LETTERS PATENT APPEAL NO. 507 of 2023
In
R/SPECIAL CIVIL APPLICATION NO. 138 of 2017
FOR APPROVAL AND SIGNATURE:
HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA AGARWAL
and
HONOURABLE MR. JUSTICE N.V.ANJARIA
==========================================================
1 Whether Reporters of Local Papers may be
allowed to see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the
fair copy of the judgment ?
4 Whether this case involves a substantial
question of law as to the interpretation
of the Constitution of India or any order
made thereunder ?
==========================================================
OPERATIONS RESEARCH GROUP EMPLOYEES UNION
Versus
STATE OF GUJARAT
==========================================================
Appearance:
MS SHIKHA D PANCHAL(10764) for the Appellant(s) No. 1
for the Respondent(s) No. 3
MR KRUTIK PARIKH, AGP for the Respondent(s) No. 1
MR KM PATEL, SR. ADVOCATE with MR NISARG DESAI, ADVOCATE
for GANDHI LAW ASSOCIATES(12275) for the Respondent(s)
No. 2
==========================================================
Page 1 of 20
Downloaded on : Mon Oct 16 20:43:19 IST 2023
NEUTRAL CITATION
C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023
undefined
CORAM:HONOURABLE THE CHIEF JUSTICE MRS. JUSTICE SUNITA
AGARWAL
and
HONOURABLE MR. JUSTICE N.V.ANJARIA
Date : 13/10/2023
CAV JUDGMENT
(PER : HONOURABLE MR. JUSTICE N.V.ANJARIA) These two are the cross Letters Patent Appeals preferred by the respective appellants under clause 15 of the Letters Patent, which are directed against judgement and order dated 12.09.2022 of learned Single Judge.
2. Industrial Tribunal, Vadodara, by its judgment and order 24.05.2016, rejected Reference (IT) No. 36 of 2013 filed by the second party Union - Operations Research Group Employees Union, the appellant in Letters Patent Appeal No. 276 of 2013. Challenging the aforesaid judgment and order of the Industrial Tribunal, the Union filed Special Civil Application No. 138 of 2017.
2.1 Learned Single Judge, as per the impugned judgment and order, allowed the said petition of the Union. The judgement and order of the Industrial Tribunal was set aside, thereby upturning the order of retrenchment passed by the employer. The workmen were directed to be reinstated to their original posts without granting Page 2 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined any backwages.
2.2 Against the aforementioned judgment and order of learned Single Judge, two Letters Patent Appeals arose. In so far as learned Single Judge denied the backwages to the workmen, the workmen's union filed the Appeal, which is No. 276 of 2023. The other Letters Patent Appeal No. 507 of 2023 was preferred by the employer seeking to call in question the order of of learned Single Judge reinstating the workmen.
2.3 Since both the appeals involve common facts and interactive issues, they were heard together to be treated for final disposal by this judgment.
3. The 10 workmen, members of the Union, while invoking the jurisdiction of the Industrial Tribunal, stated in their Statement of Claim (Exhibit 9), inter alia that the had been working under the first party employer since 16 to 35 years. It was the grievance that they came to be driven out from their services by the employer upon passing order dated 02.03.2013 and by in turn, taking the work they were doing, from the contract employees.
3.1 It was the case that the first party employer had not displayed any seniority list and no Page 3 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined seniority was taken into reckoning, thereby violating the provisions of section 25G of the Industrial Disputes Act, 1947. It was stated that in all services of 16 workmen were terminated and the work which they had been performing at the time of dispensing with their services, has been presently got done through the contractor. In the Statement of Claim, it was alleged that there was also a breach of section 9A of the Industrial Disputes Act, 1947 (hereinafter referred to as the "Act").
3.2 It was also the case that before retrenching the workmen, prior approval was not taken as required under section 25N of the Act and the conditions precedent to the retrenchment were not observed. It was the case that the action of terminating the services was illegal and that the workmen were entitled to be reinstated on the original posts with all consequential benefits.
3.3 In the reply (Exhibit 16) to the Statement of Claim, the employer contended that there was no breach of Section 25F or Section 25G of the Act. It was claimed that some workmen were engaged in providing the service of tea and coffee to the guests and visitors and that they were not required for such services as the vending machine was installed at the premises. Those workmen who were Page 4 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined assigned the work of dispatching, were also not required. Furthermore, the work of ticket booking was also rationalised by the employer, therefore the workmen engaged in such activities were not continued in service, it was stated.
3.4 The Tribunal inter alia found that the retrenchment of the workmen was as per the seniority list, therefore according to the Tribunal, whether the seniority list was placed on the notice board or not was not a material aspect. It was held that breach of section 25G was not proved. Similarly, it was the view of the Tribunal that since the work was not available, which guided the employer to retrench the workmen, question of giving notice under Section 9A of the Act did not arise.
4. Learned Single Judge while dealing with the challenge to the judgment and order of the Industrial Tribunal, considered the facts of the case and the evidence before the Tribunal as well as the findings recorded by the Tribunal to come to the conclusion that there was a breach of section 9A of the Act as there was change of condition of services of the workmen. It was observed that item 10 of 4th Schedule in the Act mentioned the procedure to be adopted at the time of rationalisation, etc., which was done away with by Page 5 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined the employer. Learned Single Judge considered the seniority list (Exhibit 21) as also the specific instances of the workmen who were retrenched and those who were retained or appointed, holding that it marked a clear violation of section 25G of the Act.
4.1 Learned Single Judge in light of reasons recorded by him, set aside the judgment and order of the Industrial Tribunal, directing reinstatement of the workmen. However, the Court found that enough evidence was not led before the Tribunal regarding their employment or possibility of employment, subsequent to the order of retrenchment and in that view, resting upon the principle of 'no work no pay', the grant of backwages were declined.
4.2 First dealing with the appeal by the employer, assailing the judgment and order of learned Single Judge as it directed reinstatement of the workmen, learned senior advocate Mr.K.M. Patel assisted by learned advocate Nisarg Desai submitted that not only that the findings arrived at by the Tribunal that there was no breach of sections 25F, 25G and section 9A of the Act, were in no way perverse to warrant interference. It was sought to be argued that the activities in which the workmen were engaged, were permanently closed, which was the real cause for doing away with their services and Page 6 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined that there was no rationalisation or standardisation of work as alleged. It was also contended that the workmen failed to establish in the pleadings as well as in the evidence that the appellant-employer had violated the principles of 'last come first go', and that there was no evidence to show that senior workmen were retained so as to give rise to situation of breach of section 25G of the Act. It was also contended that similarly, violation of sections 25F or 25N of the Act was not established. It was contended by learned senior advocate for the appellant-employer that learned Single Judge failed to appreciate that evidence of the workmen about the work carried out through another agency was not reliable.
5. Referring to the provisions of the Act, the violation of which is alleged in action of the employer in retrenching the workmen, section 25G deals with the procedure for retrenchment to state that where any workman in an industrial establishment is to be retrenched and he belongs to a particular category of workman in that establishment, the employer shall ordinarily retrench the workman who was the last employed unless for reasons to be recorded, any other workman is to be retrenched. In other words, the provisions represents the principle of 'last come Page 7 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined first go'. Section 25 H is about re-employment of workman to cast an obligation on the employer to give opportunity to the retrenched workmen, giving preference to them for employment over other persons. Section 25N deals with the conditions precedent to be observed by the employer in retrenching the workman.
5.1 The stand of the employer in respect to the above aspect was rightly not found acceptable when it tried to establish that the seniority was adhered to while retrenching by showing the list (Exhibit 21). There is no gainsaying that the said seniority list contained the names of only those workmen who were retrenched. It was not the seniority list of all the workmen on the basis of which only it could have been established that principle of 'last come first go' was acted upon and followed by the employer.
5.1.1 In paragraph 7 of the impugned judgment and order, learned Single Judge pertinently observed on the basis of the admitted evidence on record that the retrenchment letter dated 02.03.2012 in case of one of the workers named Shri Kailash Patro, who was administrative assistant, to indicate that his main work was ticket booking but in view of the change of the working style in relation to ticket booking, the services of the Page 8 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined said workman was dispensed with.
5.1.2 The similar instances of the workmen from the seniority list available from record were highlighted by learned Single Judge to suggest that not only the seniority list was incomplete, it was misleading. One G.M. Solkar given designation as Clerk and appointed on 12.01.1977 was shown to have been resigned, whereas the documentary evidence suggested that he was retrenched as per letter dated 02.03.2012 observing that seniority list was not reliable. Another instance was of one G.R. Patel, appointed in the year 1988 with nomenclature of General Service Assistant, as against him, one Shri Kailash Patro whose appointment was of the year 1988 came to be retrenched from service. Therefore, the violation of section 25G of the Act was clearly established.
5.3 A feeble, faint and failed attempt was made by learned senior advocate for the employer that there were different categories of workmen holding different posts and that the retrenchment was accordingly made, which did not amount to violation of section 25H. In that regard, in course of the hearing, he produced a typed tabular list of workmen showing their designation, date of joining, etc. Not only that, the said list had no origin in the authenticated record and was produced for the Page 9 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined first time. It did not inspire credibility as there was nothing to fortify that the employer was maintaining such list of categories, except branding the workmen with different nomenclatures.
5.4 About breach of section 25H of the Act, learned Single was justified in drawing conclusion from the evidence that the work which was performed by the retrenched workmen was outsourced through the contractor, by further indicating as to by which mode, the services were terminated. It came into evidence that one Rang Enterprise was engaged and the persons were employed. Again an erroneous and inconsequential submission was advanced on behalf of the employer that in the evidence led by the workmen did not disclose the name of the said agency.
5.4.1 Learned Single Judge in his following observations, discarded the view taken by the Tribunal in above respect, extracting from paragraph 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 Page 10 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined 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."
5.4.2 Thus, what emerged was that on one hand, the employer retrenched the workmen and on the other hand, engaged Private Limited Company for supplying the manpower. Learned Single Judge was right in observing that this was an attempt to overcome violation of section 25H of the Act, as the employer engaged the outsourced agency to carry out the work which was done by the retrenched workmen.
5.4.3 The following conclusions were correctly drawn by learned Single Judge in paragraph 10, about Exhibit 21, which was the details of the workmen concerned, "10....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 onward till 1999. Exh.21 in Page 11 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined 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. "
5.5 Merely because the workmen did not accurately mention or could not recollect the name of the agency through whom other persons were employed for the same work, but when unequivocally stated that the work was available and was got done even subsequent to their retrenchment by other persons engaged through an agency, such assertion could be said to be a sufficient discharge of the burden, as the aspect stood specifically surfaced in the evidence that Rang Enterprise was engaged through whom the persons were engaged to do the work.
5.6 Equally weighty aspect was commission of breach of section 9A of the Act. Section 9A deals with notice of change. It provides that no employer who proposes any change in the condition of service applicable to any workmen in respect of any matter specified in Fourth Schedule shall effect such change without giving to the workman a Page 12 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined notice regarding such change, etc., unless the change falls within the purview of the Proviso. Item 10 in the Fourth Schedule is one of the 11 conditions of service mentioned for the change of which, notice will be required to be given. Item 10 speaks of rationalisation, standardisation, or improvement of plant or technique, which is likely to lead to retrenchment of workmen.
5.6.1 It could indeed be figured out from the record in the present case that dispensation of the services of the workmen concerned was pursuant to the measures of rationalisation undertaken by the employer. The work of serving tea, coffee, etc. was started getting done through installation of vending machines. Rationalisation was introduced in the work of dispatch and stamping. It is this rationalisation and the use of modern tools and techniques which resulted into doing away with the services of the workmen who were engaged for that job. The conclusion was inescapable that the termination of the workmen's services could not have been effected without compliance of section 9A of the Act since the termination amounted to violation of conditions of service statutorily contemplated under the Act.
5.6.2 From the evidence of the workman Kailash Patro (exhibit 48), it clearly came out that when Page 13 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined he was retrenched, his nature of work was to get railway and air tickets booked for the staff and officers of the company. However, the employer stopped taking that work as the same was done through email and other electronic facilities. He also stated about the engagement of Shree Rang Enterprises whose services were obtained in respect of Coder, and it was also used to supply the staff.
5.6.3 Not only that, the aspect of rationalisation introduced by the employer became evident and an admitted fact from the very contents of the order dated 02.03.2012 retrenching the workmen. In the retrenchment order, it was clearly communicated to the workmen by the employer that the work they had been doing was permanently discontinued in view that for better facilities and rationalisation, the vending machines were installed from where the tea, coffee could be straightway served without the help of manual assistance. It was stated that accordingly and therefore, the services of the workmen were not required. The finding was correctly recorded by learned Single Judge that employer had introduced the procedure of rationalisation and standardisation in the respective department and that the same was covered under Item 10 of Fourth Schedule leading to violation of mandatory Page 14 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined provision of section 9A of the Act.
5.7 In light of the above discussion, this Court endorses to the findings recorded by learned Single Judge about the breach of section 9A as well as non-observance of sections 25G and 25F of the Act in terminating the services of the workmen. These provisions are rightly held to have been breached and violated.
5.7.1 In view of the above discussion, the challenge in Letters Patent Appeal No. 507 of 2023, which is filed by the Company lacks merit. The said Letters Patent Appeal deserves to be dismissed.
5.8 This takes the court to the aspect of denying the backwages to the workmen-subject matter of grievance in Letters Patent Appeal No. 276 of 2023 preferred by the Union. The backwages are denied on the premise that evidence led by the workmen was not enough, on that score. Seen in this context, learned advocate for the appellant Union Ms. Shikha Panchal drew attention of the Court to the statement on oath in the evidence (Exhibit 48) of the workman Kailash C. Patro, who in paragraph 13 of the affidavit, in terms stated that after he was retrenched from the services, he personally went to seek employment in 2 or 3 companies, but could not Page 15 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined secure the employment.
5.8.1 Similar evidence is offered by the other workman. The companies were also named which were Maruti Courier, Nandan Courier, etc., where the workman had attempted in vain to secure employment. In similar way, exhibits 41, 42, 43, 44, 45, 46 and 47 were the affidavits by other workmen in which the similar assertion was made. These workmen were cross-examined by the first employer. Even after the cross-examination, nothing otherwise was brought out, rather it stood reaffirmed that the workmen failed to get the job.
5.8.2 In the above view, when the workmen have stated on affidavit that they have attempted to secure employment during the interregnum, and they have also stated that they were not employed though tried to seek the employment, if could not have been concluded therefore by the learned Single Judge that the workmen did not lead evidence on the aspect of backwages and that there was no enough evidence regarding their employment or possibility of employment.
5.9 Learned advocate for the appellant relied on the decision of Supreme Court in Deepali Gundu Surwase vs Kranti Junior Adhyapak Mahavidyalaya (D. Ed.) and Others[(2013) 10 SCC 324], in which the Page 16 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined Supreme Court enlisted the principles in respect of payment of backwages. Firstly, it was observed by the Apex Court that in the case of wrongful termination of service, reinstatement with continuity of service and bacwages is a normal rule. It was secondly observed that the same is subject to the rider that while deciding about the issue of backwages, the Court may take into consideration, the length of service of the workmen, nature of misconduct, financial conditions of the employer and similar other factors. It was observed that ordinarily an employee whose services are terminated, has to make atleast a statement that he was not gainfully employed. It is also the onus on the part of the employer, stated the Supreme Court, if the employer wants to avoid the payment of full backwages, it has to plead and lead cogent evidence to prove that the employee was gainfully employed and was getting wages.
5.9.1 The decision in Deepali Gundu Surwase (supra) was referred to by the Apex Court in its subsequent decision in Pradeep s/o Rajkumar Jain vs. Manganess Ore (India) Ltd. [(2022) 3 SCC 638], in which the Supreme Court made following observations, "...It is, undoubtedly, true when the question arises as to whether the backwages is to be Page 17 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined given and as to what is to be the extent of backwages, these are matters which will depend on the facts of the case as noted in Deepali Gundu Surwase (supra). In a case where it is found that the employee was not at all at fault and yet, he was visited with illegal termination or termination which is actually activised by malice, it may be unfair to deny him the fruits of the employment which he would have enjoyed but for the illegal / malafide termination. The effort of the Court must be to then to restore the status quo in the manner which is appropriate in the facts of each case. The nature of the charges, the exact reason for the termination as evaluated and, of course, the question as to whether the employee was gainfully employed would be matters which will enter into the consideration by the Court."
(para 12)
6. Evaluated in light of the above principles, in the present case the workmen in their evidence asserted that they could not secure employment though they tried. It was thus suggested by the workmen that they had no source of earning during the interregnum after their retrenchment. In the cross-examination, nothing could be brought out adverse, which may help the employer on this score. Once the workmen stated that they were unemployed, the onus shifted on the employer to show that the employee was gainfully employed and was getting substantial amount. This proposition of law stands supported by the observations of the Supreme Court in Deepali Gundu Surwase (supra) found in paragraph Page 18 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined 38.4, "Therefore, once the employee shows that he was not employed, the onus lies on the employer to specifically plead and prove that the employee was gainfully employed and was getting the same or substantially similar emoluments."
6.1 Thus, when the breach of provisions of section 9A as also sections 25G and 25H of the Act are clearly established and further that the set of evidence on the aspect of backwages has been as discussed and highlighted above, learned Single Judge could be said to have committed a clear error in denying the backwages.
6.2 The termination of the services was effected on 02.03.2012. The judgment and order of the Industrial Tribunal rejecting the Reference was dated 24.05.2016. Learned Single Judge passed the order setting aside the said judgement and order dated 24.05.2016 holding that there was a breach of mandatory provisions of the Act and reinstated the workmen denying the backwages as per the judgment and order dated 12.09.2022.
6.3 Taking into account the totality of the facts emerging as above, this Court is of the view that the interest of justice would be sub-served if 50% backwages are granted to the workmen for the period from the date of termination of service, which was Page 19 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023 NEUTRAL CITATION C/LPA/276/2023 CAV JUDGMENT DATED: 13/10/2023 undefined 02.03.2012, till the date of reinstatement.
6.4 If any of the workmen has retired from service, proportionate backwages to the extent of 50% during such period shall be granted to him.
6.5 The exercise of reinstatement and paying the backwages to the workmen shall be completed within 8 weeks from today.
7. As a result, Letters Patent Appeal No. 507 of 2023 stands dismissed. Whereas Letters Patent Appeal No. 276 of 2023 is allowed in terms of the aforesaid directions and order.
Civil Application would not survive in view of the disposal of the Letters Patent Appeal.
(SUNITA AGARWAL, CJ ) (N.V.ANJARIA, J) BIJOY B. PILLAI Page 20 of 20 Downloaded on : Mon Oct 16 20:43:19 IST 2023