29 Jun 2121

Non-compliance of Sections 25-F (a) and (b) of the Industrial Disputes Act, 1947 would entitle the party for Retrenchment Compensation - Bombay High Court

Case : Hemant Babruvahan Parchake v. Social Welfare Officer and Ors. Letters Patent Appeal No. 314 of 2010 in Writ Petition No. 5982 of 2005

Court : Bombay High Court

Bench : Justice A.S. Chandurkar and Justice Pushpa V. Ganediwala

Decided on : 29 Jun 2121

Relevant Statues

Sections 2 (oo), 25-F of the Industrial Disputes Act, 1947

Brief Facts & Procedure History

1. The relevant seminal facts are that the Appellant was appointed as a `Senior Caretaker' on a daily wage basis by Respondent No. 2 with effect from 02.05.1998 at Government Beggar’s Home. His services were terminated by Respondent No. 2 on 06.11.1999. Being aggrieved by the said termination, the Appellant filed U.L.P.A. bearing Complaint No. 740/1999 before the Labour Court, Nagpur.

2. In the complaint, he has stated about the rejection of his request for appointment on compassionate ground in place of his father, who had retired as a Class-IV employee with the respondents' department. However, he was given a temporary appointment as a Senior Caretaker and worked till his termination. It is his case that his services have been terminated orally without complying with the mandate of Section 25-F of the Industrial Disputes Act, 1947.

3. The contesting Respondent No.4 denied all the adverse allegations in the complaint and stated that the appointment of the Appellant was made purely on a temporary basis. As the services of the Appellant were not required, he was terminated. The Labour Court allowed the Appellant to be reinstated with full back wages. However, the Revisional Court/ Industrial Court set aside the judgment and order of the Labour Court and remanded the matter for reconsideration. The Labour Court then reconsidered the matter and dismissed the Complaint vide judgment and order dated 06.05.2004 especially on the ground that the case of the Appellant falls under Section 2(oo) (bb) of the Industrial Disputes Act, 1947 as he was appointed on daily wage basis temporarily as per the terms and conditions by the Respondent.

4. According to the learned Judge, as the termination of the Appellant, falls under Section 2(oo) (bb) of the Industrial Disputes Act, 1947 there was no need to comply with the provisions of Section 25-F of the said Act while terminating the services of the Appellant. The judgment and order of the Labour Court were further upheld in Revision Application No.68/2004 before the Industrial Court vide order dated 19.07.2005. Consequently, the Appellant assailed the said judgment by filing Writ Petition bearing No.5982 of 2005 which was dismissed by the learned Single Judge. Hence, this Letters Patent Appeal is directed against the judgment and order dated 14.12.2009 passed by the learned Single Judge of this Court in Writ Petition No.5982 of 2005.

The Issue(s) of the Case

Whether the retrenchment of a workman without complying with the conditions in terms of Section 25-F (a) and (b) of The Industrial Disputes Act, 1947 would automatically result in the reinstatement of the workman?

The Observations of the Court

The Honourable Bombay High Court observed the following:

1. Critically analyzed Section 25-F of the Industrial Disputes Act, 1947 and the term ‘retrenchment’ defined under Section 2 (oo) of the Industrial Dispute Act, 1947.

2. Witnessed the findings recorded by the learned Single Judge that the provisions of Section 2 (oo) (bb) of the Industrial Disputes Act, 1947 were not attractive.

3. Noted that the learned Single Judge failed to consider that the termination of the Appellant falls within the definition of retrenchment as defined under Section 2(oo) of the Industrial Disputes Act, 1947 and the Appellant had worked for more than 240 days and therefore, statutory procedure as mandated under Section 25-F Industrial Disputes Act, 1947 ought to have been followed.

4. Contemplated that the retrenchment was ordered without complying with the conditions in terms of Section 25-F (a) and (b) of the said Act i.e., neither he was issued one month’s advance notice nor paid one month’s salary in lieu thereof.

5. Took cognizance of the fact that in the instant case, the appointment of the Appellant was on a daily wage basis as a stop-gap arrangement and not against any vacant post.

6. Referred to a catena of decisions of the Honourable Apex Court that in a situation where the appointment of the employee is not regular and his retrenchment is proved to be illegal for not complying with Section 25-F of the Industrial Disputes Act, 1947 instead of directing reinstatement with full back wages, the workmen should be granted adequate monetary compensation.

7. Based on the above considerations, the Court opined that it was incumbent upon Respondent No.2 to comply with the conditions in terms of Sections 25-F (a) and (b) of the Industrial Disputes Act, 1947 and the non-compliance of these conditions would entitle the Appellant for retrenchment compensation.

8. Reliance was placed upon several precedents such as Bharat Sanchar Nigam Ltd. v. Man Singh, (2012) 1 SCC 558; Assistant Engineer, Rajasthan Development Corporation v. Gitam Singh, 2013(5) MhLJ 1; Incharge Officer and Ors. v. Shankar Shetty, 2011 (1) ALL MR (SC) 931; Jagbir Singh v. Haryana State Agricultural Marketing Board and Anr., (2009) 15 SCC 327; Etc,.

The Decision Held by the Court

The Honourable Bombay High Court declared in favour of the Appellant and directed Respondent No. 2 to pay Rs. 25,000/- to the Appellant towards retrenchment compensation within a period of two months, failing which the same shall carry interest at 9% per annum.

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