Delhi District Court
Sh. Chander Prakash Pathak vs M/S. Sahni Rubber Industries on 1 June, 2017
IN THE COURT OF SHRI UMED SINGH GREWAL
PILOT COURT / POLCXVII ROOM NO. 22 :KKD
COURTS: DELHI
LIR 4288/16 (Old LIR 435/12)
Unique ID No.02402C0265842012.
IN THE MATTER OF:
Sh. Chander Prakash Pathak
S/o Sh. Devki Nandan Pathak,
Through Sahni Rubber Industries Mazdoor Union,
H. No. G 3/3 Sunder Nagari, Delhi110093.
..............Workman
Versus
M/s. Sahni Rubber Industries,
B1B2, Jhilmil Industrial Area, G.T. Road,
Shahdara, Delhi110095.
.............Management
DATE OF INSTITUTION : 12.09.2012.
DATE ON WHICH AWARD RESERVED : 22.05.2017.
DATE ON WHICH AWARD PASSED : 01.06.2017.
A W A R D :
1.Vide Order No. F.24(24)/Lab./ND/2012/1218 dated 23.07.2012, issued by Government of NCT of Delhi, a reference was sent to this Court with the following terms: "Whether services of Sh. Chander Prakash S/o Sh. Devki Nandan Pathak (Workmen) have been terminated illegally and / or unjustifiably by the management; and if yes, to what relief are they entitled?"
LIR 4288/16. 1/202. Claimant's case is that he had been working with the management since 22.07.1989 as Electrician at the last drawn wages of Rs.6,656/ per month. The management is engaged in manufacturing and sale of tyres and tubes for which about 120 workers were employed in the factory. It was running a sales office in factory premises itself where 10 persons were working. For security purpose, it had employed 10 workers. Factory office was run by 10 employees. It had opened sales office throughout India to sell tyre and tubes and more than 100 employees were working in those offices. He had filed an industrial dispute for proper date of appointment and designation which was decided in his favour by Sh. Lal Singh, thethen POIT vide award dated 29.09.2009. According to award, his salary should have been Rs.8,060/ per month but he was paid only Rs.6,656/ per month. The Hon'ble Apex Court had passed an order dated 30.11.1996 to close 168 polluting units in Delhi and management was one of them. As per that order, if the management had closed the factory, it was required to pay 6 years wages to its employees. In case, the management shifted factory to other place, it was required to pay only one year wages to the employees. The management did not want to pay wages of 6 years or one year to its employees and due to that reason, it changed his service condition by transferring him to some other place from Shahdara against which he raised an LIR 4288/16. 2/20 industrial dispute. He joined at the transferred place, but was transferred back to Shahdara factory. He used to participate in union activities as he was active member of Sawhney Rubber and Mazdoor Union. Only due to that reason, his service was retrenched on 01.12.2011 vide letter dated 30.11.2011 by taking his salary as Rs.6,656/, but computation should have been taking into account his salary as Rs.8,060/. His service was retrenched on the ground that there was no work with the management but that ground is false because there was sufficient work. At that time, several junior employees were retained and remaining work was outsourced. No notice under Rule 76 and 76A was sent before retrenchment. Seniority list was not displayed on the notice board. His service was retrenched by violating Section 9A and Section 25N of the Act. The management had given him a cheque for retrenchment compensation on 30.11.2011 which he encashed under protest. Against retrenchment, he had sent demand notice dated 02.12.2011 which went unreplied. Then, he contacted management several times for reinstatement, but he was not given duty. He is jobless since retrenchment.
3. Written statement is to the effect that management is in the business of manufacturing cycle tyres for which it had employed less than 100 workers on an average in the preceding 12 LIR 4288/16. 3/20 months from the date of retrenchment. It had engaged sole agency M/s. Vijay Sales, 544, Esplanade Road, Delhi06 for selling manufactured goods on commission basis. It never employed 120 employees in factory, 12 security guards and 12 employees in factory office. Strength of employees was never more than 100. Order of Hon'ble Supreme Court regarding 06 years of wages as closure compensation and one year wages as shifting compensation was not applicable to the management. The claimant was bona fidely and legally transferred which he did not obey. But he agreed to obey the transfer order before the Industrial Tribunal and hence, the industrial dispute was dismissed as withdrawn. In similar case regarding transfer, the Hon'ble High Court held that transfer was legitimate and legal.
It is further mentioned that claimant had worked only as unskilled worker and hence, he was paid wages as per the category of unskilled worker. Twenty six employees were retrenched w.e.f. 20.05.10 and all were paid legal dues including one month notice pay and retrenchment compensation.
In September, 2011, the management declared layoff, by which claimant was laid off from 21.09.11 to 05.10.11; 07.10.11 to 14.10.11; 15.10.11 to 29.10.11; 30.10.11 to 14.11.11 and lastly from 15.11.11 to 30.11.11. After considering the fact that despite declaring the layoff, at least 15 unskilled workers were still surplus, on 30.11.11, 15 unskilled workers including claimant, LIR 4288/16. 4/20 were retrenched alongwith 2 semiskilled workmen and 3 security guards.
The management had displayed seniority list on the notice board of the factory board and sent copy thereof to the Deputy Labour Commissioner on 05.09.11. Only the junior most 26 unskilled workers were retrenched who were paid legal dues and in this way, the management had complied with all legal provisions. After retrenchment, the management did not employ any new worker in the category in which claimant was working. Rule No. 76 or 76(A) are not applicable as chapter V(b) of the Act is not applicable. His service condition was never changed. The strength of employees was not more than 100 and hence, there was no question of violation of Section 25N of the Act. There was valid reason to retrench service of the claimant. Moreover, the reason of retrenchment cannot be made a subject matter of dispute.
The claimant alongwith other workers had raised a dispute regarding their date of appointment and designation. The Industrial Tribunal, without going into evidence, decided case in their favour which has been challenged in the Hon'ble High Court and the High Court has stayed the operation of the award. He was given minimum wages to the tune of Rs.6,656/ and hence notice pay and retrenchment compensation were computed taking into account that amount.LIR 4288/16. 5/20
4. Following issues were framed on 13.11.2013:
1. As per terms of reference.
2. Relief.
5. In order to substantiate the case, the claimant tendered his affidavit in evidence as Ex.WW1/A mentioning all the facts stated in statement of claim. He relied upon following documents: I. Ex.WW1/1 is demand notice dated 02.12.11.
II. Ex.WW1/2 is postal receipt.
III. Ex.WW1/3 is copy of publication certificate.
6. The management examined its Account Manager Sh. Mukesh Kumar as MW1, who deposed that claimant had joined management on 12.02.1989 and he had worked as Unskilled Worker at the last drawn salary of Rs.6,656/ per month. The management had retrenched 26 unskilled junior most employees on 20.05.2010 as they had become surplus. In September, 2011, the management declared layoff, by which claimant was laid off from 21.09.11 to 05.10.11; 07.10.11 to 14.10.11; 15.10.11 to 29.10.11; 30.10.11 to 14.11.11 and lastly from 15.11.11 to 30.11.11. After considering the fact that despite declaring the layoff, at least 15 unskilled workers were still surplus, on 30.11.11, 15 unskilled workers including claimant, were retrenched LIR 4288/16. 6/20 alongwith 2 semiskilled workmen and 3 security guards. They all were paid legal dues including retrenchment compensation and one month notice pay on 30.11.2011 itself. Seniority list was displayed / pasted on the factory notice board and copy thereof was sent to the office of Deputy Labour Commissioner, Jhilmil Industrial Area on 05.09.2011. The appropriate authorities were also informed through Form P of the I.D. Act, 1947 regarding their retrenchment.
MW1 further deposed that claimant was transferred on 04.07.1999. Instead of obeying the transfer order, he challenged transfer by raising industrial dispute. The Industrial Tribunal held transfer order unjustified and directed management to reinstate workman. That order has been assailed by the management by filing writ petition in the High Court and it is still pending. But the order of POIT declaring transfer of claimant unjustified has been stayed by the Hon'ble High Court.
MW1 further deposed that business of the management is dwindling and hence, now only 15 persons are working in the factory. As per certified standing orders of management, the retirement age is 58 years and hence, claimant is not entitled to reinstatement as he has already attained retirement age. He relied upon following documents: I. Ex.MW1/1 (colly. 78 pages) is photocopy of attendance register.LIR 4288/16. 7/20
II. Ex.MW1/2 is photocopy of Standing Order.
III. Ex.MW1/3 is photocopy of P Form.
IV. Ex.MW1/4 is postal receipt.
Following documents were put to WW1 by management in crossexamination: I. Ex.WW1/M1 is affidavit of claimant for counter statement filed before Hon'ble High Court of Delhi.
II. Ex.WW1/M2 is retrenchment notice dated 30.11.2011 and cheque of Rs.51,693/ dated 30.11.2011.
III. Ex.WW1/M3 is seniority list of unskilled workers. IV. Ex. WW1/M4 is Form P. V. Ex.WW1/M5 is month wise list of strength of employees of management from Dec., 2010 to Nov., 2011.
VI. Ex. WW1/M6 (05 pages ) are lay off notices.
VII. Ex. WW1/M7 is copy of award dated 09.03.2005 of POIT in transfer case.
Issue No. 1.
7. Following are the admitted facts: I. Designation case was filed by all 22 workers, whose cases are before this court, in POIT on 04.04.2000.
II. The designation case was decided in favour of workers by POIT on 29.09.2009 granting them the designations sought by them.
III.Operation of order of POIT granting designation was stayed by the Hon'ble High Court on 29.11.2013.LIR 4288/16. 8/20
IV. Services of 17 workers namely Sh. Jeet Bahadur, Awdesh Shah, Omprakash Singh, Arjun Pandit, Shankar Paswan, Narain Singh, Anil Prasad, Krishan Kant Jha, Krishan Kumar, Jitender Nath, Pramod Kumar, Ramayan Yadav, Chintu Kumar, Manoj Kumar, Jawahar Prasad, Gaya Prasad and Krishna Pandit were retrenched on 20.05.2010. V. Service of workers namely Vinod Prasad, Ram Charan, Lal Chand, Pratap Singh and C.P. Thakur were laid off from 21.09.2011 to 30.11.2011.
VI. Above workers did not challenge the laying off order. VII. Above five workers were retrenched on 01.12.2011. VIII. All 22 workers before this court had filed case before POIT against transfer.
IX. Two workers namely Gaya Prasad and Krishna Pandit had settled with management in transfer case and the management paid them a sum of Rs.5,000/ each. Additionally, they were paid Rs.2500/ each as cost of litigation.
X. Transfer case of remaining 20 workers was decided in their favour holding transfer illegal.
XI. Hon'ble High Court of Delhi stayed the operation of order of POIT vide several orders in the year 2006.
XII. Workers namely Gaya Prasad and Krishna Pandit had joined the management in 2005 after settlement in transfer case and in this way, they had not worked from the date of their transfer till rejoining.
XIII. Remaining 20 workers before this court had rejoined the management pursuant to the order of the High Court dated 12.08.2008 passed in WPC No. 4688/2006.
XIV. Above 20 workers had not worked with management LIR 4288/16. 9/20 from their date of transfer till the date of rejoining.
8. Ld. ARW argued that management had given wrong reason in retrenchment notice. At that time, the work which the claimant used to work, was available with management and that work is still available. He next argued that junior employees were retained while retrenching claimant's service. After his retrenchment, the management has given work on contract basis. Ld. ARM replied that reason mentioned in retrenchment notice was that claimant alongwith other workers had become surplus and that is why, his service was terminated. As per list displayed on the board of factory and sent to the Labour Department, the claimant was amongst junior most employees and hence, his service was retrenched. No work is being taken on contract basis i.e. no work has been outsourced.
It is the claimant who is alleging that he had not become surplus as the management, at the time of retrenchment, was having sufficient work. Onus of proof of that fact is upon claimant but he did not produce any witness or document to that effect. In crossexamination, all workers gave different versions. Some of them deposed that they were not knowing anything about the factory after retrenchment. If they are not knowing the state of affair of the factory, how can they allege that the management had LIR 4288/16. 10/20 outsourced work. On the other hand, it has been deposed specifically by MW1 that service of the claimant had become surplus. That witness was not crossexamined on that point. In order to prove that some junior employees were retained, the workman should have examined a witness from the management alongwith list of workers. No such witness was examined. On the other hand, the seniority list prepared by management is on the file. The claimant did not produce any evidence contrary to the seniority list. He did not name any employee who was junior to him at the time of retrenchment. Moreover, the management has produced attendance record. So, arguments of ld. ARW on these three points fail.
9. Next argument of ld. ARW is that seniority list as per rule 76A of Industrial Disputes Act, 1947 was not displayed. On the other hand, ld. ARM argued that seniority list was displayed on the notice board and copy thereof was sent to Labour Department also.
Seniority list dated 05.09.2011 is on the file as Ex. WW1/M3. That list was sent to Labour Commissioner, Delhi Government on that very date. It is mentioned in that list that copy thereof was displayed on the notice board of management. Form P under Rule 76 dated 01.12.2011 is on the file as Ex. WW1/M4.LIR 4288/16. 11/20
That form was sent to Labour Commissioner of NCT of Delhi mentioning that management was retrenching services of 26 unskilled workers. So, the management has proved that it had not only displayed but also sent copy of seniority list of Labour Commissioner of Govt. of NCT of Delhi.
10. Ld. ARW argued that management had violated Section 9A of I.D. Act, 1947 by transferring the service of the claimant to some other places from Delhi. It had also violated Section 25N of the Act. Arguments of ld. ARM are that there was no occasion for the management to violate the provisions of those Sections because those Sections were not applicable to the management.
Bare perusal of Section 9A of the I.D. Act, 1947 shows that it comes into operation when an employer proposes to effect any change in the service conditions of any workman in respect of any matter specified in 5th Schedule. Perusal of 5th schedule shows that the matter of transfer is not contained in it. By transferring claimant to some other place, the management had not violated Section 9A of the I.D. Act, 1947. Provisions of Section 25N applies to an industrial establishment in which no less than 100 workmen were employed on an average per working day in the preceding 12 months. The management has placed on LIR 4288/16. 12/20 record attendance register of its employees for preceding 12 months prior to retrenchment. That register proves to the hilt that strength of employee during that period was never 100. So, there is no applicability of Section 25N of the Act.
11. Next ground is that his service was retrenched due to his union activity. That ground is not more than a bald statement. MW1 was not, at all, crossexamined on this point.
12. Ld. ARW argued that 22 workers were transferred from Jhilmil factory to some other places against which they had raised industrial dispute. Excluding Gaya Prasad and Krishna Pandit, the matter was decided in their favour by POIT on 09.03.2005 holding transfer illegal. Sh. Gaya Prasad and Krishna Pandit had settled with management in transfer case. These two workers had joined management in 2005 whereas the other workers had joined management pursuant to the order of High Court dated 12.08.2008 passed in WPC No.4688/2006. While calculating retrenchment compensation, the management did not include the period from the date of transfer order till their rejoining, in the length of service. In this way, retrenchment compensation paid by management was inadequate and hence, it had violated Section 25F of the I.D. Act, 1947. On this point, LIR 4288/16. 13/20 arguments of ld. ARM are threefold. The first one is that the order dated 09.03.2005 passed by POIT has been stayed by the Hon'ble High Court. The second is that it was held by the High Court in order dated 08.12.2009 while dealing with 17B applications of the claimants that rights of workers to get back wages from the date of award till the date they resumed their duty with management shall be deiced by itself. The third is that from the date of transfer till the date of rejoining, the claimant had not worked with management and as per Section 25F, the management is to give retrenchment compensation for the period for which the workman had actually worked.
It is not in dispute that the order dated 09.03.2005 passed by the Hon'ble POIT declaring transfer of 20 workers illegal, has been stayed by Hon'ble High Court of Delhi by passing various orders in 2006. The service of the claimant was retrenched after elapse of several years of staying of operation of order of POIT. The stay order comes into force from the date of passing of the stay order. When the service of the claimant was retrenched, the stay order was very much in existence. Hence, the management was not justified to include the period from date of transfer till the date of his rejoining in his total period of working with management, while calculating retrenchment compensation. Moreover, perusal of order dated 08.12.2009 passed by thethen Hon'ble Justice Mr. S.N. Aggarwal shows that question of back LIR 4288/16. 14/20 wages from the date of award till the date they resumed their duty pursuant to the order of High Court dated 12.05.2008 shall be decided by Hon'ble High Court itself at the time of final decision of writ petitions. So, this ground also fails.
13. Ld. ARW lastly argued that all 22 workers had filed designation case before POIT and that case was decided on 29.09.2009 granting them designations and the category of skilled and semiskilled workers. While calculating retrenchment compensation, the management took into account the last drawn salary of the claimant and not the wages of skilled and semiskilled worker as ordered by POIT. It should have taken into account the wages of skilled and semiskilled workers as the designations had already conferred upon him by POIT on 29.09.2009. Due to that reason, retrenchment compensation is inadequate and hence, retrenchment is illegal. Ld. ARM argued that operation of order dated 29.09.2009 passed by POIT granting designation to the claimant has been stayed by the Hon'ble High Court of Delhi by passing an order dated 29.11.2013. Due to stay order, the management was perfectly correct in calculating retrenchment compensation and notice pay as per their last drawn wages and not as per the award dated 29.09.2009. He next argued that claimant had filed a case against his transfer in which it was held by POIT LIR 4288/16. 15/20 that he was doing unskilled job. That award was not challenged by him before any forum and hence, the said award has become final and is operating as resjudicata. He next submitted that vide award dated 29.09.2009, the Hon'ble POIT granted only designation to the claimant. The POIT did not hold that he was entitled to wages of skilled or semiskilled category.
It is the admitted position of both parties that all 22 workers had filed a designation case before POIT on 04.04.2000 and that case was decided in their favour on 29.09.2009. It is also the admitted position that the operation of order dated 29.09.2009 was stayed by the Hon'ble High Court on 29.11.2013. It is the admitted case of both parties that service of 17 workers was retrenched on 20.05.2010 and five workers on 01.12.2011. So, this court is to decide the case as per the facts which were in existence on the dates of retrenchment i.e. 20.05.2010 and 01.12.2011. At that date, only the order dated 29.09.2009 passed by POIT was in existence. The stay order dated 29.11.2013 was not in existence. It was held by the Hon'ble Apex Court in Shree Chamundi Mopeds Ltd. Vs. Church of South India Trust Association CSI Cinod Secretariat, Madras, (1992) 2 SCR 999 that the meaning of stay order is that the order which has been stayed would not be operative from the date of passing of stay order. Same view was taken by Hon'ble High Court of Delhi in National Agricultural LIR 4288/16. 16/20 Cooperative Marketing Federation of India Ltd. Vs. Commissioner of Income Tax, DelhiXI & Anr., ITA 161/2016 decided on 19.04.2017, in following words:
19. The court is unable to agree with the above reasoning of the ITAT as it runs contrary to the wellsettled legal position explained by the Supreme Court in several decisions. In Shree Chumundi Mopeds Ltd. V. Church of South India Trust Association (1992) 3 SCC 1, the effect of an interim order was explained as thus:
"While considering the effect of an interim order staying the operation of the order under challenge, a distinction has to be made between quashing of an order and stay of operation of an order. Quashing of an order results in the restoration of the position as it stood on the date of the passing of the order which has been quashed. The stay of operation of an order does not, however, lead to such a result. It only means that the order which has been stayed would not be operative from the date of the passing of the stay order and it does not mean that the said order has been wiped out from exercise."
As per above citations, the position becomes clear that the stay order becomes operative from the date of making of stay order. In the case in hand, the stay order was granted on 29.11.2013 whereas retrenchment had taken place on 20.05.2010 LIR 4288/16. 17/20 and 01.12.2011 respectively. Hence, the management was utterly wrong by not calculating notice pay and retrenchment compensation as per award dated 29.09.2009. It is correct that in transfer case, the POIT had given observation in para No. 14 that it was proved on the file that the workmen were unskilled labour and were not working as alleged. Due to that finding, the said award was cited before POIT in designation case that the above observation was acting as res judicata but the POIT did not agree with management and held that the nature of job of claimant was not substantially in issue in that matter as those matters were cases of transfer. In transfer case, POIT was merely to decide whether the transfer of claimant was legal or not. The POIT held transfer illegal. The issue before that court was not whether the claimants were working as skilled or unskilled workers. So, observation of POIT in transfer case is not acting as resjudicata.
Para No.13 of award dated 29.09.2009 passed by the then POIT Mr. Lal Chand in designation case is to the following effect:
13. "...Therefore, this goes to show that the workmen have been performing job of skilled and semiskilled nature..."
Above finding of POIT proves that the ld. Judge had reached to the conclusion that the workers were entitled to LIR 4288/16. 18/20 designations which they were claiming and that they were working in skilled and semiskilled category. But the management computed their notice pay and retrenchment compensation not as per the category of semiskilled or skilled workers. Due to that reason, it had violated the provisions of Section 25F of the I.D. Act, 1947. Hence, this issue is decided in favour of claimant and against management.
Issue No. 2.
14. The claimant had joined the management on 12.02.1989 and he was transferred to some other place on 04.07.1999. Against transfer, he had raised an industrial dispute which was decided in his favour. He rejoined the management and his service was retrenched w.e.f. 30.11.11. He had not worked with the management from the date of transfer till rejoining. Chronology of those events shows that relations between the parties have soured to an irreparable extent. If reinstatement is granted, it would not work in the interest of any of the party. Moreover, it has been deposed by MW1 that now the management is on the brink of closure as only 15 workmen are working with it. The claimant did not lead evidence contrary to the testimony of MW1. So, relief of reinstatement is totally ruled out. The length of service of claimant is 13 years. He was entitled to the wages of skilled / semi skilled category, but the management did not pay LIR 4288/16. 19/20 him under those categories. Taking into account all these facts, a lumpsum compensation of Rs.3,90,000/ (Rupees Three Lakhs and Ninety Thousands Only) is granted to the claimant. The management is directed to pay Rs.3,90,000/ (Rupees Three Lakhs and Ninety Thousands Only) to him within one month from the date of publication of the award, failing which it shall be liable to pay interest on it @ 9% per annum from today till its realization. Parties to bear their own costs. Award is passed accordingly. The reference is answered accordingly.
15. The requisite number of copies be sent to the Govt. of NCT of Delhi for publication of the award. File be consigned to Record Room.
Dictated to the Steno & announced (UMED SINGH GREWAL) in the open Court on 01.06.2017. PILOT COURT/ POLCXVII KKD COURTS, DELHI.
LIR 4288/16. 20/20