Case BriefsHigh Courts

Delhi High Court: The Division Bench of Rajiv Shakdher and Talwant Singh, JJ., decided a matter with regard to payment of full wages to workman while proceedings are pending pertaining to him in the Court.

Respondent 1 – workman moved the application under Section 17B of the Industrial Disputes Act, 1947 read with Section 151 of the Code of Civil Procedure, 1908.

The present appeal was preferred by the appellant-Corporation against the decision by which Single Judge was pleased to set aside the award passed by the Labour Court and vide the said order, Single Judge had granted regularization to the workman with 30% back wages and continuity of service for all purposes.

Labour Court had dismissed the workman’s claim, but the Single Judge had set aside the award and granted reinstatement with regularization but the NrDMC, instead of implementing the said decision challenged the same before the Division Bench.

Applicant-workman moved this application under Section 17B of the Act for payment of full back wages last drawn or minimum wages, whichever was higher, inclusive of any maintenance allowance as per provision of Section 17B of the Act.

Analysis, Law and Decision

“17B. Payment of full wages to workman pending proceedings in higher court:

where in any case a Labour Court, Tribunal or National Tribunal by its award directs reinstatement of any workman and the employer prefers any proceedings against such award in a High Court or the Supreme Court, the employer shall be liable to pay such workman, during the period of pendency of such proceedings in the High Court or the Supreme Court, full wages last drawn by him, inclusive of any maintenance allowance admissible to him under any rule if the workman had not been employed in any establishment during such period and an affidavit by such workman had been filed to that effect in such Court:

Provided that where it is proved to the satisfaction of the High Court or the Supreme Court that such workman had been employed and had been receiving adequate remuneration during any such period or part thereof, the Court shall order that no wages shall be payable under this section for such period or part, as the case may be.”

 As per NrDMC, it was difficult to find details of the present employment of the applicant-workman-respondent 1 and if an order under Section 17B of the Act is passed, it will burden the public exchequer as NrDMC was reeling under a financial crunch and the public money would go in wrong hands.

In Court’s opinion, the grounds by NrDMC were not tenable.

Law

“…if re-instatement has been ordered by Court and the employer, instead of complying with the said directions, chooses to challenge the said order, the workman is entitled to full wages last drawn by him, inclusive of any maintenance allowance admissible to him during the pendency of the said challenge by the employer.”

Court noted that a point was raised by the management that since the award passed by the Labour Court was not in favour of the workman, he had no right to move an application under Section 17B of the Act.

There is no provision for appeal provided in the Industrial Disputes Act against the decision of a labour court, which is in the form of an award.

The Bench opined that the writ petition was only a continuation of the reference/claim originally filed by the workman before the labour court, hence, the decision of the Single Judge to reinstate the workman with 30% back wages and to consider his case for regularization as per prevalent policy, was in the nature of Award in favour of the workman.

The said decision of the Single Judge had been challenged by the management, hence this Court had the jurisdiction to grant relief under Section 17B of the Industrial Disputes Act.

In the present matter, NrDMC failed to negative the claim of the workman that he was not gainfully employed. Since the disposal of the appeal would take some time, the workman and his family members cannot be allowed to starve in the meantime.

Concluding the matter, the workman was entitled to full wages last drawn by him and since respondent 1 had been ordered to be regularized with all consequential benefits, the Management, i.e., NrDMC shall pay his full last drawn wages or minimum wages, which ever higher from 18-2-2020 onwards and keep on paying during the pendency of the present appeal. [North Delhi Municipal Corporation v. Bal Kishan, 2021 SCC OnLine Del 5543, decided on 24-12-2021]


Advocates before the Court:

For the appellant: Ms Namrata Mukim, Standing Counsel with Ms Garima, Jindal, Adv.

For the Respondents: Ms Namrata Mukim, Standing Counsel with Ms Garima, Jindal, Adv. For R-1

Case BriefsSupreme Court

Supreme Court: The Division Bench of L. Nageswara Rao and S. Ravindra Bhat, JJ., gave relief to the appellant by directing that he be paid back wages as specified with continuity in service.

In the instant matter, appellant was appointed as ‘Rakshak’ in the Railway Protection Force.

Further, it was submitted that, while he was on duty, on 20/21-2-1981 it was found some articles in the godown were found removed and placed near the fencing.

In view of the above incident, a departmental enquiry was initiated for appellant’s failure in preventing theft of railway property and hence appellant was found guilty of gross negligence.

Further, a penalty reduction of pay to the minimum of the timescale of Rs 200 for a period of 2 years affecting his future increments was imposed.

Appellant had filed an appeal against the penalty order and the said penalty was enhanced by the appellate authority after issuing a show cause notice to the appellant from the reduction of time scale to that of removal from service.

Appellant filed a petition challenging the order of appellate authority which was dismissed by the Single Judge. Though the Division Bench observed that there was no theft of any railway property as the heavy springs were found near the fencing after having been removed from the godown.

Analysis, Law and Decision

Supreme Court opined that the penalty of reduction of time scale of Rs 200 for a period of 2 years with cumulative effect was also unjustified.

Since 1983, the appellant was out of employment and during the pendency of the matter before the High Court, he attained the age of superannuation and could not be reinstated. Adding to the said, High Court Bench expressed that the appellant was entitled to all the retiral benefits.

Hence, Court directed the respondents to pay 33% of back wages to the appellant with continuity of service and the appellant shall be paid full retiral benefits by treating him to be in continuous employment, by giving notional increments and promotion and benefits based on continuity. Bench directed that the said arrears be paid in 10 weeks.[Laxman Singh v. Union of India, 2021 SCC OnLine SC 470, decided on 9-07-2021]


Advocates before the Court:

For Petitioner(s):  Mr. Aldanish Rein, AOR

Ms. Maheravish Rein, Adv.

Ms. Shamshravish Rein, Adv.

For Respondent(s): Ms. Madhvi Divan, LD ASG

Mr. Raj Bahadur Yadav, AOR

Ms. Priya Mishra, Adv.

Mr. Mukul Singh, Adv.

Ms. Nidhi Khanna, Adv.

Ms. Vaishali Verma, Adv.

Mr. Amrish Kumar, AOR

Case BriefsSupreme Court

Supreme Court: The Division Bench of Sanjay Kishan Kaul and Hemant Gupta, JJ., while addressing the matter, expressed that,

The public officers of the Executive are also performing their duties as the third limbs of the governance. The actions or decisions by the officers are not to benefit them, but as a custodian of public funds and in the interest of administration, some decisions are bound to be taken.

“summoning of the public officer is against the public interest as many important tasks entrusted to him gets delayed, creating extra burden on the officer or delaying the decisions awaiting his opinion.”

Factual Matrix

In the instant matter, the appeal challenged the orders of Allahabad High Court wherein the appellants were directed to calculate and pay 50% of the back wages to the respondent and to grant all the consequential benefits.

Petitioner who was posted at the State of Uttarakhand was posted as a Medical Officer and transferred to State of Uttar Pradesh as per the option given by the Medical officers. Though the petitioner was posted at Badaun, he did not join there and was well satisfied by giving a letter to Director of Medical Health Services.

Subsequently, in the year 2006, the petitioner claimed a writ of mandamus commanding the State to post the writ petitioner as a Medical Officer in any Hospital according to his qualification and experience in the specialized cadre. Single Judge allowed the same and concluded that the posting order or transfer order was never communicated or served upon the petitioner at any point of time.

In pursuance of the High Court order, a fresh posting order was issued and subsequently, another petition seeking direction for payment of back wages was filed.

Principal Secretary declined the grant of back wages for the reason that petitioner did not perform any government work for the period from 5-07-2003 till 9-12-2016 and the same cannot be treated as a compulsory waiting period under the provisions of Fundamental Rules 9(6)(b)(iii) of Financial Hand Book Volume-2 Part 2-4 and hence he was granted extra ordinary leave for the said period.

Initially, it was decided by the Single Judge Bench that State could not produce as to how and when the posting order was communicated to him. Court was aware of the fact that the petitioner was relieved by the Uttarakhand Government and a communication was addressed by the Joint Director with regard to the joining report of the petitioner.

In Court’s opinion, when the petitioner stood relieved from Uttarakhand, High Court could not have returned a finding that the State did not show as to how the transfer and posting order was conveyed to the petitioner.

High Court overlooked Supreme Court’s decision in State of Punjab v. Khemi Ram, AIR 1970 SC 214, wherein a question arose that whether suspension order was to be actually received by the employee to be affected. Supreme Court examined the question as to whether communicating the order means its actual receipt by the concerned government servant.

Analysis, Law and Decision

Supreme Court on perusal of the facts and circumstances of the case held that the petitioner was relieved by the Government of Uttarakhand in the year 2003, he filed the petition in 2006, meaning he was awaiting his posting orders for a period of 3 years.

Further, it was noted that he started his own private practice in the said period and intentionally delayed the decision on petition for almost 13 years.

Court expressed that the petitioner’s conduct suggested that he was not keen on joining as a Medical Officer after he was relieved by the Uttarakhand Government.

Feigned Ignorance

Uttarakhand Government’s Order relieved the petitioner on 5-7-2003 in pursuance of the order of the Government of Uttar Pradesh. Bench in view of the said position stated that it was a case of feigned ignorance.

Medical Officer: Idle for 13 long Years?

Petitioner was gainfully employed, as noted by the Single Bench. It was impossible for the Court to imagine that a Medical Officer would sit idle for 13 long years, hence the grant of 50% back wages would be giving benefit of one’s own wrong who intentionally abstained from duty for 13 long years and now wanting to take benefit of back wages as well.

Petitioner’s stand was not only unjustified but wholly condemnable. 

Bench remarked that, State should have taken steps to initiate disciplinary proceedings.

State was remiss in not taking action against the petitioner for absence from duty.

Another disturbing feature noted by the Court was that the Secretary, Medical Health was called in-person in the Court.

“…certain High Courts have developed a practice to call officers at the drop of a hat and to exert direct or indirect pressure.” 

Line of Separation

Bench expressed that, the line of separation of powers between Judiciary and Executive is sought to be crossed by summoning the officers in a way of pressurizing them to pass an order as per the whims and fancies of the Court.

It is always open to the High Court to set aside the decision of the Executive which does not meet the test of judicial review but summoning of officers frequently is not appreciable at all. The same is liable to be condemned in the strongest words.

In Supreme Court’s decision of Divisional Manager, Aravali Golf Club v. Chander Hass, (2008) 1 SCC 683, observed that

Judges must know their limits. They must have modesty and humility, and not behave like emperors. The legislature, the executive and the judiciary all have their own broad spheres of operation. It is not proper for any of these three organs of the State to encroach upon the domain of another, otherwise the delicate balance in the Constitution will be upset, and there will be a reaction.

Conclusion

Bench reiterated that public officers should not be called to Court unnecessarily. Dignity and majesty of the Court is not enhanced when an officer is called to Court. Respect to the court has to be commanded and not demanded and the same is not enhanced by calling public officers.

Power of Pen

Courts have the power of pen which is more effective than the presence of an officer in Court. Elaborating more on this aspect, Court suggested that if any particular issue arises for consideration before the Court and the Advocate representing the State is not able to answer the same, it is advised to write such doubt in the order and give time to the State or its officers to respond.

Therefore, in the present matter, the petitioner was posted at Badaun and was he was to report to the same place. He should have asked for a transfer after reporting, if permissible by the State and he should not have dictated the place of posting without even joining the place where he was first posted.

In view of the above discussion, while allowing the appeal, Supreme Court decided that the High Court orders were wholly unjustified, unwarranted, arbitrary and illegal. [State of U.P. v. Dr Manoj Kumar Sharma, 2021 SCC OnLine SC 460, decided on 9-07-2021]

Case BriefsHigh Courts

Gujarat High Court: A.P. Thaker J., upholding the decision of the Labour Court with respect to reinstatement of the workman, directed the employer to pay compensation of Rs 55000 as a lump sum against prayer for 100% back wages.

Being aggrieved with the award dated 23-04-2009 passed by the Labour Court, both workmen and the employer have preferred the respective petitions.

The workman has preferred Special Civil Application No. 540 of 2010 contending that he was serving with the employer on the post of supervisor and rendered his services for more than five years with no appointment letter or permanent assurance as such. One fine day, he was terminated from his position without any inquiry. It is further contended that in his reference before the Labour Court wherein he was granted prayer for reinstatement in service, the Labour Court factually and legally erred in not granting 100% back wages. Therefore, he has prayed to quash and set aside the award and grant him the same.

The employer has filed Special Civil Application No. 10377 of 2009 against the award contending that the Labour Court has committed serious error of law and facts in granting reinstatement in service as the workman has admitted that he was working on daily rated basis and in that view of the matter, when work was not available with the employer, he was automatically discharged. Further, it is also contended by the employer that the dispute is contractual in nature which, essentially, does not attract the Industrial Disputes Act, 1947.

Counsel for the petitioner relied on Talwara Cooperative v. Sushil Kumar, (2008) 9 SCC 486, Executive Engineer v. Ayubhai Ladharbhai, 2010 (2) GLH 700 and Counsel for the respondent placed reliance on, General Manager Haryana Roadways v. Rudhan Singh, (2005) 5 SCC 591 and UP State Brassware v. Uday Narain Pandey, (2006) 1 SCC 479.

Court found no error of facts or law committed by the Labour Court with respect to reinstatement and for 100% back wages, it said, “… considering the materials placed on record and the decisions cited, it is found that the workman is not entitled to 100% backwages, however, granting of backwages at 25% is also not proper, especially in view of peculiar facts of this case. At the relevant time, the workman was getting Rs.1500/- and considering the peculiar facts of this case, instead of granting any back wages, it would be just and proper to pay lump sum compensation of Rs.55,000/- for back wages to the workman, which will serve the ends of justice”[Karsan Shivaji Sanghar v. Ashapura Mines, 2021 SCC OnLine Guj 61, decided on 13-01-2021]


Sakshi Shukla, Editorial Assistant has put this story together

Case BriefsForeign Courts

Supreme Court of the Democratic Socialist Republic of Sri Lanka: A Full Bench of Sisira J. de Abrew, Murdu N.B. Fernando and S. Thurairaja, JJ., allowed an appeal filed in terms of Article 154(P) of the Constitution read with Section 31-DD of the Industrial Disputes Act (as amended) and Section 9 of the High Court of the Provinces (Special Provisions) Act No. 19 of 1990.

The Applicant-Respondent, in this case, was the Manager attached to Thanamalwila Branch of Uva Development Bank.  His services were terminated by the Bank and there were several charges levelled against him at the domestic inquiry, the President of the Labour Tribunal had decided that the Applicant-Respondent of the said Bank had not acted with 100% honesty in dealing with affairs of the bank, subsequently an appeal was filed in the High Court where they had affirmed the order of the Labour Tribunal who had held that the termination of services of the Applicant-Respondent was unjustified and had ordered reinstatement and  ½ back wages. Being aggrieved by which the Employer-Appellant had filed the instant petition.

The Court while allowing the appeal relied on the judicial decisions of National Savings Bank v. Ceylon Bank Employees Union, 1982 (2) SLR 629 and Bank of Ceylon v. Manivasagasivam, 1995(2) SLR 79, held that the President of Labour Tribunal who stated that the Manager had not acted with 100% honesty when he was dealing with his duties cannot be ordered to be reinstated in the same bank with back wages. Thus, the decision of both the President of the Labour Tribunal and the High Court Judge were held to be wrong and were set aside making the termination of the Applicant-Respondent justified. [Uwa Development Bank v. Ceylon Bank Employees Union, SC Appeal No. 39 of 2016, decided on 02-07-2019]

Case BriefsHigh Courts

Delhi High Court: J.R. Midha, J. allowed a writ petition filed by the employer challenging the award of the Labour Court whereby the respondent was ordered to be reinstated with 40% back wages.

The employer had engaged the respondent on daily wages, who deposited deficient sale proceeds for several months in 1989 and 1990. The employer issued memos to the respondent, whose services were ultimately terminated on the ground of loss of confidence. The respondent raised an industrial dispute which was referred to the Labour Court, which subsequently made the impugned award.

Anju Bhattacharya, Nandita Chandra and Elign Matt John, Advocates representing the employer, submitted that there was no infirmity in termination of respondent’s service. Per contra, B.P. Singh Parihar, Advocate for the respondent, supported the impugned award.

The High Court observed: “the law with respect to the loss of confidence is well- settled that the reinstatement cannot be ordered when an employee acts in a manner by which the management loses confidence in him. In case of loss of confidence, only compensation can be awarded.” Reliance was placed on State of Travancore v. Prem Singh, 2019 SCC OnLine Del 8258 wherein the High Court had summarised the principles regarding the termination of service in case of loss of confidence.

It was brought to Court’s notice that the employer had paid around 7.47 lakhs to the respondent under Section 17-B of the Industrial Disputes Act, 1947 (payment of full wages to the workman pending proceedings in higher courts).

The Court was satisfied that the instant case was squarely covered by principles laid down in State of Travancore case. No infirmity was found in termination of respondent’s services. The writ petition was allowed and the award of Labour Court impugned herein was set aside. However, a compensation of Rs 75,000 was awarded to the widow of the respondent (who had expired during the pendency of the petition).[Delhi State Civil Supply Corpn. Ltd. v. Badan Singh, 2019 SCC OnLine Del 9977, decided on 30-08-2019]

Case BriefsSupreme Court

Supreme Court: The bench of L Nageswara Rao and MR Shah, JJ held that a man, by virtue of the disciplinary proceedings being dropped, the Appellant becomes entitled to claim full salary for the period from the date of his suspension till the date of closure of the departmental inquiry.

Factual Background

  • The Court was hearing the case of a Sorting Assistant in Railway Mail Service against whom disciplinary proceedings were initiated on the allegations of involvement in forged payments of high value money orders.
  • He was suspended on 23.10.1979 and an FIR under Sections 409, 420 and 467 IPC was filed.
  • The order of suspension was revoked on 21.10.1987 pursuant to which he joined duty and worked till 28.02.1997, when he was dismissed from service in view of his conviction under Section 409, 467 and 420 IPC. He was sentenced to imprisonment for three years.
  • His appeal against conviction was allowed and he was acquitted of the charges for offences under Section 409, 420 and 467 IPC.
  • He claimed that he should be entitled to full back wages from the date of the order of his acquittal i.e. 31.08.2001 till the date of his reinstatement i.e. 20.01.2003.

Ruling

After perusing various judgments, the Court said that the department would become liable for back wages in the event of a finding that the initiation of the criminal proceedings was mala fide or with vexatious intent. It, however, clarified:

“If an employee is involved in embezzlement of funds or is found indulging in demand and acceptance of illegal gratification, the employer cannot be mulcted with full back wages on the acquittal of the person by a criminal Court, unless it is found that the prosecution is malicious.”

Noticing that it was the Appellant who was seeking postponement of the departmental inquiry in view of the pendency of criminal case and that the order of suspension was in contemplation of disciplinary proceedings, the Court said:

“the Respondents took four years to reinstate him by revoking his suspension. The order of suspension dated 23.10.1979 came to an end on 21.03.1983 which is the date on which disciplinary proceedings were dropped. The Appellant ought to have been reinstated immediately thereafter unless a fresh order was passed, placing him under suspension during the pendency of the criminal trial which did not happen.”

The Court, hence, held that the Appellant is entitled for full wages from 23.10.1979 to 21.10.1987 after adjustment of the amounts already paid towards subsistence allowance.

[Raj Narain v. Union of India, 2019 SCC OnLine SC 452, decided on 01.04.2019]

Case BriefsSupreme Court

Supreme Court: The Bench comprising of A.M. Sapre and S. Abdul Nazeer, JJ, partially allowed a civil appeal filed against the judgment of Jharkhand High Court whereby the dismissal order passed against 37 workmen was set aside and full back wages were granted to them.

The appellant was the Public Health and Engineering Department, whereas, the Workmen Union representing the said 37 workmen was the respondent. The short question that arose for consideration was whether the High Court and the Labour Court were justified in awarding full back wages to the said 37 workmen after setting aside their dismissal order holding it to be bad in law, being in contravention of Section 25-F of the Industrial Disputes Act, 1947 and, in consequence, directing reinstatement of such workmen in service of the appellant.

On considering the submissions, the Supreme Court was inclined to allow the appeal in part. It was opined that the Courts below completely failed to see that back wages could not be awarded by the Court to a workman as of right consequent upon setting aside of his dismissal order. In such cases, it is necessary for the workman to plead and prove that after his dismissal from service, he was not gainfully employed elsewhere and had no earning to maintain himself and his family. The factors that need to be kept in mind while deciding on grant of back wages were discussed by the Supreme Court in earlier decisions in M.P. SEB v. Jarina Bee, (2003) 6 SCC 141; Haryana Roadways v. Rudhan Singh, (2005) 5 SCC 591; Deepali Gundu Surwase v. Kranti Junior  Adhyapak Mahavidyalaya, (2013) 10 SCC 324; etc. The Court, in the instant case, held that neither the Labour Court nor the High Court kept in consideration the principles of law as discussed in the aforementioned decisions. Therefore, the Supreme Court did not concur with the direction of the Courts below awarding full back wages to the workmen, which in Supreme Court’s opinion, certainly caused prejudice to the appellant (employer). However, in the interest of justice, the Court awarded 50% of the total back wages to the said 37 workmen. The order impugned was accordingly modified. The appeal was disposed of in the terms above. [Management of Regional Chief Engineer, Public Health and Engineering Department v. Their Workmen, 2018 SCC OnLine SC 1587, decided on 20-09-2018]

 

Case BriefsSupreme Court

Supreme Court: In the revision petition filed against the order directing LIC to pay full back wages to it’s employees, the Court was of the opinion that though the aspect of financial hardship would not be a sufficient ground to warrant interference in a case, but keeping in view the fact that LIC is a statutory Corporation operating in the interest of the public at large, on the limited point of payment of full back wages to the temporary and badli workers who are entitled for regularisation, the matter could be revisited.

The Court noticed that the temporary and badli workers of LIC, who are entitled for regularisation as permanent workmen in terms of the impugned judgment and order dated 18.03.2015 passed by this Court, are held to be entitled to full back wages as well. However, keeping in mind the immense financial burden this would cause to LIC, the Court modified the relief only with regard to the back wages payable and therefore, we award 50% of the back wages with consequential benefits. It was directed that the back wages must be calculated on the basis of the gross salary of the workmen, applicable as on the date as per the periodical revisions of pay scale. The Court said that the periodic revisions of pay of basic salary, as submitted by LIC, along with other component figures comprising the gross salary including Dearness Allowance, House Rent Allowance etc. etc., as applicable, must be accounted for while computing the amount due to the workmen towards the back wages.

Considering the fact that the order has been passed in favour of workmen and the dispute is being litigated for nearly 25 years, the bench of V. Gopala Gowda and C. Nagappan, JJ directed LIC to comply pay the back wages within 8 weeks from the date of the order. [Tamil Nadu Terminated Full Time Temporary LIC Employees Association v. S.K. Roy, 2016 SCC OnLine SC 805, decided on 09.08.2016]