Gujarat High Court
Chairman Shri/Manager Shri, Pragati ... vs Ashvinbhai Chhotabhai Patel on 28 January, 2025
NEUTRAL CITATION
C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 12916 of 2022
With
R/SPECIAL CIVIL APPLICATION NO. 12983 of 2022
FOR APPROVAL AND SIGNATURE:
HONOURABLE MRS. JUSTICE M. K. THAKKER
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Approved for Reporting Yes No
No
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CHAIRMAN SHRI/MANAGER SHRI, PRAGATI COOPERATIVE BANK
LIMITED
Versus
ASHVINBHAI CHHOTABHAI PATEL
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Appearance:
MEHUL C MEHTA(9386) for the Petitioner(s) No. 1
MR RAJESH P MANKAD(2637) for the Respondent(s) No. 1
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CORAM:HONOURABLE MRS. JUSTICE M. K. THAKKER
Date : 28/01/2025
ORAL JUDGMENT
1. This petition is filed under Article 226 and 227 of the Constitution of India challenging the award passed by the learned labour court, Vadodara in Recovery Application (C-2) No.136 of 2010 dated 30.04.2022 whereby, the petitioner was directed to pay the benefit as claimed by the respondent along with 6% interest Page 1 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined from the date of filing of the application.
2. The gist of the case is that the petitioner bank is covered under the provisions pf the Bombay Industrial Relations Act, 1946 (hereinafter referred to as the "BIR Act") and to maintain cordial relations with the employees of the bank the settlement/agreement was entered into as per section 2(35) of the BIR Act. It is provided under the said settlement that salary, bonus, leave encashment is to be revised after every two years and for that, claim is made before the learned labour court by way of recovery application under section 33(C)(2) of the ID Act. The terms of the settlement was from 01.01.2000 to 31.12.2003. It is claimed by the respondent employee that being an ex-employee he would be entitled for the certain benefits in view of the settlement dated 01.01.2000, he would be entitled for difference of salary, difference of salary of over time, difference of salary of bonus, difference of salary of leave encashment, difference of salary of provident fund, difference of salary of C.L.
3. The petitioner bank appeared and filed written statement contending that amount has already been paid Page 2 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined as per the settlement as he would be entitled for above benefit after completion of three years and learned labour court would not have jurisdiction to entertain such recovery applications straightaway by passing adjudication as per the provisions of section 78 read with item no.5 of schedule 3 pertaining to the interpretation of construction and terms of agreement/ settlement as per section 42 of the BIR Act. Learned labour court after considering the evidence adduced by both the parties has allowed the application filed by the respondent which is the subject matter of consideration before this Court.
4. Heard learned advocate Mr.Vasavada with learned advocate Mr.Mehta for the petitioner and learned advocate Mr.Mankad for the respondent. 4.1. Learned advocate Mr.Vasavada submits that learned labour court has committed error in usurping the jurisdiction under the ID Act, as it is well settled that under section 78, the adjudication of the claim is required to be done first and thereafter, only for execution of the said adjudication the application filed under section 33(C)(2) of the ID Act. Learned labour Page 3 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined court has adjudicated the dispute by exercising the power under section 33(C)(2) and thereafter, directed the petitioner to pay the same, without jurisdiction as the settlement which was relied was interpreted in different manner. Learned advocate Mr.Vasavada submits that claim is delayed by seven years as receipt of all benefits as per the settlement was issued as per the admission made by the respondent during his evidence however, learned labour court without assigning the reasons for the delay has passed an order in favour of the respondent. Learned advocate Mr.Vasavada submits that the settlement was arrived between the parties for the year 2000 to 2003 and therefore, also the claim of the respondent was stale and not accepted however, learned labour court has awarded reference in favour of the respondent.
4.2. Learned advocate Mr.Vasavada relies on the judgment in the case of Bombay Chemical Industries Vs Deputy Labour Commissioner reported in 2022 5 SCC 629 and submitted that labour court has no jurisdiction to adjudicate dispute of entitlement or basis of claim of workman however, can only interpret the Page 4 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined award or settlement on which the claim is made. The reliance was also placed on the judgment in the case of State of Karnataka Vs Ravi Kumar reported in 2019 13 SCC 746 and submitted that stale claim which was sought to be referred after 14 years could have been rejected only on the ground of delay.
4.3. Learned advocate Mr.Vasavada has further submitted that the settlement under the BIR Act and settlement under the ID Act stands under different footing and no adjudication was made on the basis of long term settlement which arrived between the Union of workers of the Cooperative Bank and with the petitioner Bank and as there was no right crystalised in favour of the respondent learned court would have not adjudicated the dispute by exercising the power under section 33(C) (2) of the I.D.Act. Learned advocate Mr.Vasavada submits that as the settlement was arrived under section 2(35) of the BIR Act not under section 2(3) of the Act instead of granting the relief straightaway which was sought learned court would have considered the scheme of settlement which was arrived under the BIR Act. However, without doing the same the impugned order is Page 5 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined passed. Learned advocate Mr.Vasavada at the end submitted that by misreading the settlement which was arrived on 01.01.2000 the impugned order is passed therefore, same is required to be set aside and the petition is required to be allowed.
5. Per contra, learned advocate Mr.Rajesh Mankad appearing for the respondent has submitted that action of the petitioner Bank of not granting the benefits available under the settlement is discriminatory, arbitrary and unjust. It is further submitted that under the settlement, the respondent was entitled to get the benefit of increment and accordingly consequential amount in Over time, bonus, leave salary etc and despite the obligations under the settlement, petitioner failed to pay the said benefits in compliance of the settlement and therefore, the respondent was constrained to file recovery application which was ordered in favour of the respondent. Learned advocate Mr.Rajesh Mankad submits that as the right was claimed on the basis of settlement dated 08.05.2000 the recovery application was filed under section 33(C)(2) claiming the pre existing right arising from the settlement. Learned Page 6 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined advocate Mr.Rajesh Mankad has relied on the decision rendered by this Court in the case of Kantilal Chhotalal Patel Versus Chairman/Manager, The Baroda Central Co-Operative Bank Ltd. in SCA No.539/2020 and submitted that any proceedings which are held under the BIR Act cannot eclipse the provisions of ID Act, and section 120A of the BIR Act clarifies that no proceedings shall be held under the BIR Act relating to any other dispute which has been referred and is pending before any forum under the ID Act.
5.1. Learned advocate Mr.Rajesh Mankad submits that so far as the contention with regard to the delay, which was raised by the petitioner by not complying with the terms of the settlement the petitioner bank has committed continuous wrong and therefore, it cannot be said that the stale claim became revive by the impugned award. Learned advocate Mr.Rajesh Mankad submits that as per the admission made by the witness of the petitioner they paid the benefits after three years however, the settlement dated 08.05.2000 provides that the same should be paid on completion of two years. Learned Page 7 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined advocate Mr.Rajesh Mankad submits that there was no disputed fact as stated by the learned advocate for the petitioner and therefore, no interference is required and the petition requires to be dismissed.
6. Considering the submissions made by the learned advocates and considering the settlement dated 08.05.2000 as well as the settlement dated 09.08.1996 which was reproduced by the learned labour court in the impugned award, it emerges that the respondent herein was serving as Clerk-cum-Cashier with the petitioner bank since 01.07.1978 and retired on 30.01.2010 on attaining the age of superannuation. On 08.05.2000 there was a settlement arrived between the Union of the employees of the bank as well as the bank wherein, stagnation increment was provided on completion of the two years as per condition no.2(D). For better understanding the said condition is reproduced hereinbelow:
"2(D):- Stagnation Increment Where an employee who has reached the last level of the pay structure ceases to be entitled for the annual increment, his pay shall be given a Stagnation Increment equivalent to the last increment received by him and his pay shall continue to be Page 8 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined increased in this manner. This increment shall be given every two years and it shall be as per the last increment received by him."
7. It is undisputed fact that prior to the settlement dated 08.05.2000 there was settlement dated 09.08.1996 wherein, the said increment was provided on completion of three years. The condition no.2(D) of the settlement dated 09.08.1996 is also reproduced hereinbelow:
"2(D):- Stagnation Increment Where an employee, who has reached the last level of pay- structure, ceased to be entitled for annual increment, he shall be given Stagnation Increment equivalent to his last increment and in this manner, his pay shall continue to increase. There shall be maximum three (3) such increments and first such increment shall be given three (3) years after the last annual increment."
8. It is undisputed that after 1997 as per the settlement dated 1996, the first increment was granted in the year 2000 i.e on completion of three years as per condition 2(D) of the settlement dated 09.08.1996. Thereafter, the settlement dated 08.05.2000 came into force wherein, the stagnation increment was provided on completion of two years however, instead of granting the same in the year 2000 the same was granted in the year 2003, 2006 and 2009. According to the said increment the payment of consequential wages was also paid application under Page 9 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined section 33(C)(2) is filed by the respondent employee claiming that though the stagnation increment was required to be paid in July 2002, July 2004, July 2006 and July 2008 as per the settlement dated 08.05.2000 the same was paid according to the earlier settlement dated 09.08.1996. It is also claimed that other increment like bonus, over time, PF, CL, leave encashment and leave salary is also required to be recalculated on the basis of the stagnation increment as per the settlement dated 08.05.2000 and the for the difference amount the table is stated at page 29 is also required to be paid.
9. The contention raised by the present petitioner that there is disputed fact that whether the respondent would be entitled on completion of three years or on completion of two years appears to be unfounded as on referring the settlement, more particularly condition no.2d wherein it is clearly stated that on completion of two years the stagnation requirement is required to be paid to the employees. During the cross examination of the witness of petitioner it was admitted that stagnant increment was paid in July 2000, second increment paid in July 2003, in July 2006 was the third increment and Page 10 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined fourth increment was paid in July 2009. Therefore, it appears that petitioner by interpreting the settlement in convenient manner has paid stagnant increment on completion of three years instead of completion of two years. Reliance which was placed by the learned advocate Mr.Mankad on the decision rendered by this Court in the case of Bombay Chemical Industries Vs Deputy Labour Commissioner (supra) wherein also the Apex Court has held that labour court by exercising the power under section 33(C)(2) can interpret the award for settlement for which the claim is made.
10. As in the instant case, claim is on the basis of settlement, this Court is of the view that no prior adjudication or recognition of the claim is required. This court has also referred the decision which was relied by the learned advocate for the petitioner in the case of State of Karnataka and Ors Vs Ravi Kumar (supra) wherein, the case before the Apex Court was that after 14 years the writ petition was filed before the High Court seeking declaration that his termination of the service was in violation of section 25 of the ID Act and relief of reinstatement was sought on the post of cleaner Page 11 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined with back wages from the date of termination till the date of reinstatement with continuity of service. The High Court by order dated 16.03.1998 dismissed the writ petition as same was not maintainable however, observation was made that a representation be given to the State Government and State Government may consider whether dispute should be referred under section 10(1)(C) of the Act or not. In that background, the Apex Court has held that as respondent did not choose to challenge termination of 14 years and merely because some other daily wagers got the relief he is not entitled for the relief which was sought.
11. In the instant case, relief which was sought was espoused form the settlement dated 08.05.2000 and it was bounding duty of the petitioner employer to interpret the settlement in true manner however, with a view to deprive the respondent employee to get the benefit out of settlement it was interpreted in the manner which is beneficial to the employer. In that view, this Court is of the view that the ground of delay which was raised by the learned advocate for the petitioner is unbounded to the petitioner as this would be continuous Page 12 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined wrong which was committed by the petitioner employer and therefore, merely claim was made after seven years would not disentitle the respondent from getting the benefit which he has claimed.
12. The other ground that settlement under the BIR Act as well as the settlement under the ID Act are on different footing and unless and until the claim is adjudicated under section 78A of the BIR Act the labour court would not have the jurisdiction to decide the same by exercising the power under section 33(C)(2). This court has referred the decision relied by the learned advocate for the respondent in the case of Kantilal Chhotalal Patel Versus Chairman/Manager, The Baroda Central Co-Operative Bank Ltd. (supra) wherein, this Court has observed as under:
"6. The facts, which are established from the record, are that all the petitioners have retired from the respondent-Bank and after their retirement, the respondent-Bank has calculated their Leave Encashment as per 300 days, though each of the petitioners are having more than 500 days leaves in their credit. The petitioners filed recovery applications for claiming the Leave Encashment as per the settlement dated 01.10.2002. The provisions of settlement, more particularly 8-h(i), (iii) and (iv) were relied upon by the petitioners for claiming the amount of Leave Encashment. The Page 13 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined respondents had contended that such applications were not maintainable on the ground of delay and also the same would not be maintainable under the provisions of the I.D. Act as the respondent-Bank is governed by the provision of the BIR Act. So far as the ground of delay is concerned, the same has been held in favour of the petitioners by observing that no limitation is provided for filing an application under the provisions of Section 33C(2) of the I.D.Act. The Labour Court, thereafter, has also examined the provisions of settlement and has concluded that all the petitioners are entitled to more amounts over and above, which are paid to them of 300 days with regard to the Leave Encashment. Thus, there is a definite finding in favour of the petitioners that they are entitled to the Leave Encashment as per the settlement. However, the recovery applications have been rejected by placing reliance on the order dated 19.07.2010 passed in Special Civil Application No.7359 of 2009 by holding that the recovery applications are not maintainable since the respondent- Bank is governed under the provision of the BIR Act.
8. At this stage, it would be apposite to refer to Section 120A of the BIR Act, which reads as under:-
"120A. Provisions of Act XIV of 1947 not to be affected.- [Nothing in this Act shall affect any of the provisions of the Industrial Disputes Act, 1947, (XIV of 1947.) and no proceeding shall be held under this Act relating to any matter or dispute which has been referred to and is pending before a Board, a Court for inquiry, a Labour Court or a Tribunal under the said Act."
Section 120A was introduced after the promulgation of the I.D.Act. A plain and simple reading of the provisions will suggest that the provisions of the BIR Act will not affect any of the Page 14 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined provisions of the I.D. Act. The Division Bench in the case of D.S.Vasavada (supra) has held thus:-
7. We are aware that the case being one of employment in Textile Mills, the Bombay Industrial Relations Act, 1946, applies S. 35 of that Act provides for Standing Orders in regard to matters mentioned in Schedule I. Entry 4 in Schedule I relates to closure or re-opening of a department or a section of a department or the whole of the undertaking. We are also aware that Standing Orders as finally settled for operatives in cotton textile mills at Ahmedabad are in force and Standing Order No. 9 A specifically deals with the closure of any department after giving two months' notice to the operative concerned. We have noticed that S. 120A of the Bombay Industrial Relations Act, 1946 provides that nothing in that Act shall affect any of the provisions of the Industrial Disputes Act, 1947. The Standing Orders prescribe only the procedure for closure and the consequence by way of termination of services by reason of the closure is to be found in the provisions of S. 25FFA read with S. 25FFF of the Industrial Disputes Act, 1947. In other words, there would be termination of the services by reason of closure only if there is compliance with Ss. 25FFA and 25FFF. That there is no such compliance is a matter beyond controversy.
The Division bench has noticed the provision of section 120A of the BIR Act and has held that the same stipulates that nothing in that Act shall affect any of the provisions of the I.D. Act. Thus, any proceedings which are held under the BIR Act cannot eclipse the provisions of the I.D.Act. The section further clarifies that no proceedings shall be held under the BIR Act relating to any matter or dispute which has been referred and is pending before any forum under the I.D.Act.
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NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined
10. It is no more res integra that a workman/employee can approach the Labour Court or Tribunal by resorting to the provision of section 33C(2) of the I.D. Act for claiming any benefit capable of being computed in terms of money, which is due to him from the employer under any settlement or award. The intention behind the introduction of Section 33C(2) of the I.D.Act was to provide a short and immediate remedy to an employee for realization of the amount. The explanation to the section clarifies the expression "Labour Court" used in section 33C of the I.D.Act. It is acknowledged that the "Labour Court" includes any Court constituted under any law relating to investigation and settlement of industrial disputes in force in any State. The petitioner is claiming the benefit of Leave Encashment as per the settlement arrived at between the Union and the respondent-Bank which was made effective from 01.10.2002 to 31.10.2002 and confirmed by the Industrial Court, Baroda in Refence (I.C) N0.3 of 1998. Thus, the Explanation to section 33C(2) of the I.D.Act will encompass the award passed by the Labour Court under the provision of the BIR Act. Any benefit arising of the same can be claimed by an employee by resorting to the proceedings under section 33C(2) of the I.D.Act. The proceedings under section 33C(2) of the I.D.Act cannot be restricted to the award passed under the said Act. Hence, the Labour Court has fell in error in rejecting the application of the petitioner filed under section 33C(2) of the I.D.Act claiming differential amount of leave encashment as per the settlement."
13. As the aforesaid contention has already been decided by this Court in the case referred herein-above this Court would not discuss further as the same is not more res Page 16 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025 NEUTRAL CITATION C/SCA/12916/2022 JUDGMENT DATED: 28/01/2025 undefined integra.
14. Considering the overall circumstances this Court is of the view that no error has been committed by the learned labour court in granting the benefit which was claimed arising from the settlement dated 08.05.2000 regarding stagnation of increment and other consequential wages. Hence, this petition being devoid of merits is required to be rejected.
15. Resultantly, this petition is rejected.
(M. K. THAKKER,J) NIVYA A. NAIR Page 17 of 17 Uploaded by MRS. NIVYA ABHAY NAIR(HC01901) on Mon Feb 03 2025 Downloaded on : Mon Feb 03 21:32:30 IST 2025