Interviews

A science student turned advocate, Mr. Sanjay Bhasin is a designated Senior Advocate at the Allahabad High Court. Apart from having a 36 year long standing before the Court, he is a leading Arbitration Counsel in India.

He has been interviewed by Ayush Shukla, EBC/SCC Online Student Ambassador who is currently pursuing law from TNNLU.

 

1. What motivated you to pursue law as a discipline and a career. Was it an obvious choice for you, given that your father was an advocate?

No, it was not my obvious choice at all. I was a science student throughout and was interested in the same, but because I did not do well in my MSc, my father said I had no other option but to go for law. But while pursuing my law, I developed a great liking for it. So yes, it was not my first choice and was only my second-best choice, I did not want to get into the hassles of law, but somehow, I got involved in it.

Based on my interest in Science, I wanted to be a scientist or a lecturer. Still, destiny brought me here, and I have relished this period spanning from 1986-1987 that I have spent in the field of law.

2. Could you tell our readers about your experience in law school and what lessons you have learned in your law school that have been an integral part of your journey as a practitioner?

I was not that serious during my law school. I did my law at DAV College, where we only had two morning classes. So, I spent the rest of my day in labour courts, as I used to be a chauffeur to my father, who used to practise in the labour courts. So, throughout the day, I watched the proceedings before various authorities of the Labour Court. If one does this religiously, one will start picking up things from there itself.

But here, I always remembered my father’s lessons during those days, which have been with me throughout my life. He told me to maintain the profession’s integrity, always be honest and dedicated to the judicial system, and create your image through your hard work. He used to tell me that if you are hardworking, you will succeed. Whether or not you are going to succeed in that particular case or not, will depend on the merits of the case, but in any case, you should not be found in a situation where you did not do enough labour, or you did not present it well enough.

My teachers also taught the same lessons. They said that lawyers are otherwise taken to be liars, but they are not so, as whatever they say or present is based on the strength of the affidavits and documents exchanged between the parties, and based on those, only a lawyer takes its stand. So, integrity and honesty are the things that have been imbibed in me by my father and teachers, and I have been following that very religiously.

One more thing that I would like to advise all the students that my father used to tell me is to work on your oratory skills. One needs to practise oration. That practice of oration could only be for a short duration, like 5 minutes or 10 minutes a day. Like just read a newspaper aloud, as that will provide thrust to your voice, it will give clarity to what you speak, it will improve your pronunciation, and it will change your overall personality. So, everybody, who wants to be a practicing lawyer, should practice this.

Here I also remember the advice given to me by my senior, Justice Bhalla, who, as and when I joined him, was an Additional Chief Standing Counsel, and later on, he went on to become a Judge. He taught me that I should read one judgment a day and make notes of the same. So, I had a diary, where I used to note all the important points of the judgment, and I used to observe how those points have been dealt with in the judgment.

3. During your initial days in the field, how did you do research on a case? Today we have research tools like SCC Online, which has to an extent, made our job more manageable. And what can our generation learn from your initial days’ experience of researching, which we can inculcate in today’s time?

In the absence of present time research tools, we were solely dependent upon the digests and the commentaries. We had those yearly digests of Supreme Court, labour and industrial court cases, factory law journals, etc. Those digests and commentaries were prepared so that you could reach the particular case law you are looking for by referring to the index itself.

Personally, I think that the manual thing was quite beneficial because it gave us insights into the complete aspect of the section we were researching. Moreover, when going through these commentaries, you will find judgments from both sides, so you can always read the other view. Once you do that, you get an obvious idea of the provision because you must have read judgments from both sides. At present, I agree we can reach the judgment faster, but that much off reading is missing among the youngsters. As by that additional reading, we used to learn ten more things besides what you were searching for, which perhaps is now missing. So, I feel this is what the upcoming generation can inculcate in themselves.

4. You have had an illustrious career in the field of arbitration, so according to you, what are the reforms or changes that should be introduced in the current regime of arbitration in India to make it a more viable option for the resolution of disputes by parties in India?

A4. Coming to arbitration, you see, I started with labour courts, then ventured to service matters. I was appointed in the Service Tribunal for a brief moment and then appointed as Standing Counsel in High Court, where I served the State for 20 years with different Governments. The first arbitration case that came to me was somewhere in 2003, so for the last 20 years, I have been dealing with arbitration, contracts, and other matters.

What I have found in arbitration is that the arbitrator has been given unfettered powers, and there are very limited grounds, as have been enumerated in Section 34, based on which the arbitrator’s award can be challenged. The award cannot be challenged on merits, so the arbitrator’s words are final on merits. I find this one thing very arbitrary, as this gives unfettered powers to the arbitrator because if he gives an award in his prudence, it is to be accepted as it is unless there are any legal flaws in it or it is not in conflict with the public policy then it is binding upon the parties. So, he can go overboard; he can do anything without any framework to stop him. I agree there is this entire legislation, but despite that, he has so much power in him without any checks and balances. This, I feel, needs a little consideration and deliberation. Personally, I think there should be some sort of an appellate authority, like, for instance, NCLT where we have an appellate authority, NCLAT, so whatever happens in NCLT, there is a provision for appeal in NCLAT. Here, in the arbitration act, there is no such forum available. Of course, the act states that you can seek setting aside of the award under Section 34, but that is based on some limited grounds only.

Moreover, invariably every award is challenged. Like in almost 90% of the cases, the award is challenged. So, we are having litigation, and the idea behind arbitration was to reduce litigation, but we are actually added to the litigation because the case goes before the District Court in the first place, then it comes to the High Court, and at times people even come to the court in between the proceedings. Very recently, there was a challenge to the arbitrator’s order, invoking Article 227 of the Constitution of India, which is related to the power of superintendence, and the inherent power of the court, which we are still dealing with this matter, and the judgment has been reserved. So, there should be an appellate forum provided by the act, which is the one thing I would like to suggest.

The second thing that I would like to suggest is that the parties should be given some sort of right to seek a change of arbitrator. You see, an arbitrator is somebody who is supposed to be Caesar’s wife, beyond all doubts; here, I am not questioning the integrity of the arbitrator, but due to the unfettered power given to them by the act, there can be an angle of bias in the proceedings. Although an arbitrator is supposed to make disclosures, like he is not related to any of the parties in any way, but suppose one of the parties thinks that the arbitrator, who throughout the proceedings will be the same person, is biased or has developed a bias towards particular party during the proceedings. Then the award passed by him could be maligned by his prejudices, which he may have developed during the course of proceedings itself. So, for this, there should be some cure. That cure can be given in the form of some sort of rights to the parties for seeking a change of the arbitrator or institutionalising the whole thing. Once it gets institutionalised, the case does not go to the same person with whom the party could have some grounds (not in all cases). In this way, the parties will not feel that they have been deprived of justice. So, that is the little grey area, where the party, even during the proceedings, may feel that they will not receive justice from the arbitrator, and besides that, they are forced to continue. So, these are the two areas where I feel some work needs to be done on the legislative side.

5. Recently Chief Justice of India N.V. Ramana inaugurated the International Mediation and Arbitration Centre in Hyderabad, so could you tell our readers about the need for institutional arbitration, as inaugurated in Hyderabad, and how is institutional arbitration different from ad hoc arbitration?

So, you talked about mediation and arbitration centres. We also have it here in the High Court. Here, court-annexed mediations are referred to the centre. We also have arbitration chambers, but they are meant only to hold the arbitration proceedings. When I say institutionalisation, it actually means something like an arbitral court, where we have a number of arbitrators. When the matter is referred to the institution, it provides an arbitrator, and those arbitration proceedings are also held there.

Moreover, these institutions on the administrative side work upon and ensure that arbitration is carried out free from any biases and prejudices. In such an institution, there ought to be a facility for transferring arbitration matters conducted by one arbitrator to another arbitrator within the same institution. Here, the institution itself can be taken as an arbitral forum. The institution itself provides the arbitrator, who will not be static for one arbitration, facilitating the same arbitration matter before different arbitrators based on modus operandi, rules, and regulations.

6. The extravagant cost involved in arbitration proceedings has often been criticised, so what are your views on this issue, and what can be some possible solutions?

Yes, the cost involved in the disputes is stupendous. What is there in Schedule 4 was only indicative. Until Schedule 4 was inserted, the arbitrator was free to decide its fee. But now, once this schedule has been introduced, everyone has to stick with it. When we talk about Schedule 4, I am yet to understand its impact, as the schedule gives slabs of fees depending upon the sum of the dispute, and just below the schedule, you will find that 25% extra has to be paid in case there is only one arbitrator. Now, what does this mean, is the fees as have been specified in the schedule related to the cost of the whole arbitral panel, or is it the cost of one arbitrator. Based on the intent behind this provision, it actually means that if there is a panel of three arbitrators, then only the slab amount is to be given to the whole panel, which perhaps has to be divided among the three arbitrators. Otherwise, the type of fees given to an arbitrator, let’s suppose ten crores, if is to be given to an individual arbitrator, then it is a huge amount. Therefore, I do not find these figures irrational, as when High Court under Section 11 states that the fees have to be decided in accordance with the schedule, then it is also binding on the parties to follow it, and as far as the negotiation with the arbitrator on fees is concerned, that thing is not possible.

A possible solution to this can be that there should be some declaration that the fee prescribed in the schedule should be for the whole panel of three arbitrators. And in case there is only one arbitrator, then his fees should be one-third of what is prescribed in the schedule plus 25% of that amount.

7. What will be your advice to law students and practitioners looking forward to a career in arbitration?

A7. There is a lot of scope in arbitration. The law students and practitioners looking forward to a career in arbitration should be thorough with the Contract Act and the Arbitration Act. Nowadays, the Government has made it mandatory that every government contract invariably has to have an arbitration clause, so with this, the Government is trying to lighten the burden of the courts. Still, the Government has not been successful, which is one thing. There is another thing which I would like to say regarding the lawyers. Being a lawyer is a job; he has to handle the court, handle the clients, and handle the people around him to increase his clientele. It is a very engaging profession. The lawyer will find significantly less time for his family or any miscellaneous job. Moreover, for a young lawyer to get arbitration matters is in itself a job. So, I would suggest that young lawyers should first establish themselves in the eyes of their seniors so that their senior has confidence in them and give out cases of arbitration and others to young lawyers. Once this confidence is developed, they have to prove their worth by their dint of labour. Otherwise, what I perceive is that getting arbitration matters for a young lawyer is not an easy job.

8. We all know that you have been in the legal industry for over three decades, so what, according to you, are the skill sets that are essential for this profession, and how can a law student utilise their time in the law school to develop these skills?

I have talked about certain skills like oration practice and reading one judgment a day, which are some skill sets that one should develop. One more thing I may have missed out on, and it will cover up, is that you need to carry a smile throughout. You see, half of your job is done with politeness and smile; if you are polite in your submissions, if you are submissive in your arguments, half of your job is done. When I entered this profession, I was told by my teachers, my guru, my father, and others that you should learn three words, “Ji Sir; Yes Sir; Ha Sir”, nothing beyond this. Whenever a Judge says something, it must be any of these three things. One should never say “na” or no to anything; start with a “Yes My Lords” even if you do not agree with what the Judge said, or he may even be wrong in his proposition, then also you must start from Yes Sir or Yes My Lords and then put across your point, this is essential for a youngster. So never start with a no, always be submissive, and then very sweetly and softly take the Judge along with you with whatever you wish to say, because if you start with a no, then it is human psychology that he would become resistant to you, he may not be receptive to what you would be saying, but once you say yes, then he may be receptive to what you may be having to speak. Another thing will be never frown or show your anger in the court, even if you are. Never fight with your colleague on the other side of the dice. Always show respect to him and the court; the world would be yours. So, this is one mantra that I learned during the initial days of my practice.

9. Any final piece of advice for our readers.

Hard work and labour with every brief that comes. Here, I would like to share one thing. When I started practicing in the High Court, there was a perception among the people that I was an expert in the Labour Laws. But to be upfront and honest, I will say I learned Labour Laws in just three months, and those three months were on my first case, which I asked for from my father. Once he permitted me, I went through the entire pleadings, prepared my notes, and started working on the legal aspects of it. Once I started working on it, I was neck deep in Industrial Disputes Act. Once you start reading the case laws related to it, you get ten more case laws referred to in that particular case that you read, and so on. In this way, I had a great command of that topic. During those days, my schedule was such that I used to return at 7.00 p.m. from the courts, and then I used to do this work till around 2.00 to 2.30 a.m., that too when I was scolded by my mother to leave the work and go to sleep. But for doing that extra work, I never forced myself. I enjoyed the process throughout. As once you start enjoying it, you begin to imbibe it, appreciate it, and understand it. Once you do that, you will become a master of that particular thing. So, my final word would be that you can never achieve success without hard work.

Gujarat High Court
Case BriefsHigh Courts

   

Gujarat High Court: Biren Vaishnav, J. allowed petitions which were filed challenging the awards of the Labour Court ordering reinstatement of the employees of Patan Nagarpalika who had raised the issue of early retirement age.

The respondent (now deceased) who was working with the Patan Nagarpalika had raised an industrial dispute before the Labour Court contending that the stand of the petitioner — Nagarpalika in retiring them at the age of 55 on and from 30-09-2007 is bad. It was his case that he was entitled to continue till the age of 60. The stand of the Municipality before the Labour Court was that the Municipality had power to retire a municipal servant at any time on or after he attains the age of 55 years on giving him three months’ notice according to Rule 5 of the Rules framed under Section 271 of the Gujarat Municipalities Act, 1963. The Labour Court had allowed the petitions and ordered reinstatement.

The Court held that it was within the powers of the municipality in exercise of powers under Section 271 of Gujarat Municipalities Act, 1963 to frame rules. Proviso to Rule 5 indicates that the action can be taken by a municipality against an employee where employee reaches the age of superannuation. This, of course, is subject to he being given three months notice and notice pay in lieu thereof.

Relying on the decision of a Division Bench of Gujarat High Court in context of the same municipality dated 03-03-2020 rendered in Special Civil Application Nos. 22332 of 2005, the Court affirmed that the section gives specific powers to make rules and the operation of Rule 5 and consequential retirement was held valid. The petitions were allowed finding that there was sufficient compliance of Rule 5, inasmuch as, notice of three months was given.

[Chief Officer v. Solanki Kanubhai Danabhai (deceased), R/Special Civil Application No. 1697 of 2020, decided on 27-06-2022]


Advocates who appeared in this case :

Ms Dhara Shah, Advocate, for the Petitioner 1;

Mr Prabhakar Upadyay, Advocate, for the Respondent 1.


*Suchita Shukla, Editorial Assistant has reported this brief.

Karnataka High Court
Case BriefsHigh Courts

Karnataka High Court: K.S. Mudagal, J., allowed the petition and set aside the impugned award awarding compensation as well as the silver medal allowance without considering the question of maintainability of the petition under Section 33C(2) of the I.D. Act.

The facts of the case are such that the respondent was working as a driver in the petitioner’s organization. On 03-03-2004, during the course of his duty, the bus driven by him met with an

accident on Bengaluru – Mangaluru route and he suffered injuries. The medical board issued certificate stating that due to the said injuries, the respondent cannot discharge his duty as driver. Thus, the petitioner assigned the respondent alternate light work. The petitioner treated the respondent’s period of absence from March 2004 to October 2005 as on duty and paid full salary. Admittedly, the respondent claimed compensation under Motor Vehicles Act and was awarded compensation with interest. The respondent got notice issued to the petitioner claiming compensation  with interest under the Employee’s Compensation Act, 1923 (for short ‘Act, 1923’) on the ground that he suffered disability during the course of employment. Then he preferred claim petition before the Labour Court Mangaluru under Section 33C (2) of the Industrial Dispute Act, 1947 (for short ‘the I.D.Act’) claiming compensation along with interest and Silver Medal Allowance. The Labour Court  allowed the claim petition and awarded compensation as well as the silver medal allowance without considering the question of maintainability of the petition under Section 33C(2) of the I.D. Act. Assailing this, the present petition was filed.

Counsel for petitioner Ms. Shwetha Anand submitted that Section 33C (1) and (2) of the ID Act shall be read in an integrated and holistic manner. Section 33C (2) of the Act can be invoked only in relation to an award or the settlement contemplated under Section 33C(1) of the I.D. Act. As the respondent did not perform the duty of driver, after the accident he was not entitled to silver medal allowance.

Counsel for respondent Mr. VS Naik submitted that Section 33C(2) of the I.D. Act is an independent provision and need not be preceded by an award. Irrespective of workmen getting compensation under the Motor Vehicle Act, he is entitled to claim under the Act, 1923.

The Court observed that Section 33C(2) of the I.D. Act refers to any amount due to workman. Section 33C(1) of the I.D. Act speaks of any amount due to workman under the settlement or award under the provision of Chapter 5-A or 5-B of the I.D. Act. The respondent claimed that he was entitled to claim the amount due to the injuries suffered by him during the course of employment. Therefore his claim was under the Act, 1923. In such event the claim lies before the Employee’s Compensation Commissioner and not before the Labour Court.

The Court relied on judgment Municipal Corporation of Delhi v. Ganesh Razak,  (1995) 1 SCC 235  and State of U.P v. Brijpal Singh (2005) 8 SCC 58 wherein it was observed

The Labour Court has no jurisdiction to first decide the workmen’s entitlement and then proceed to compute the benefit so adjudicated on that basis in exercise of its power under Section 33C(2) of the Act. It is only when the entitlement has been earlier adjudicated or recognised by the employer and thereafter for the purpose of implementation or enforcement thereof some ambiguity requires interpretation that the interpretation is treated as incidental to the Labour Court’s power under Section 33C(2) like that of the Executing Court’s power to interpret the decree for the purpose of its execution. 

It is not competent to the Labour Court exercising jurisdiction under Section 33C(2) to arrogate to itself the functions of an industrial tribunal and entertain a claim which is not based on an existing right but which may appropriately be made the subject matter of an industrial dispute in a reference under Section 10 of the Act.”

The Court thus observed that in view of the respondent not performing the work as a driver and assignment of lighter work to him, whether he was entitled to silver medal allowance was a matter of adjudication. Therefore that could have been subject matter of a dispute under the I.D Act. Without such adjudication, in the light of the judgment of Supreme Court, the respondent could not have maintained the petition under Section 33C(2) of the I.D. Act.

The court held “The Labour Court committed error in assuming the jurisdiction under Section 33C(2) of the ID Act. The award is liable to be set aside.”  [Management of KSRTC v. K. Shivaram, WP No. 17583/2017, decided on 04-04-2022]


Arunima Bose, Editorial Assistant has reported this brief.

Case BriefsHigh Courts

Delhi High Court: Prathiba M. Singh, J., while examining a case which was dismissed 30 years ago with regard to a workman’s misconduct, reiterated the well-established law that, customers’ need not be produced in such proceedings in order to prove the misconduct of the workman.

The present petition challenged the impugned order passed by labour court and vide the said order the claim of workman/petitioner who was working as a Conductor with respondent-DTC was rejected by the Labour Court.

Background

Petitioner was appointed as Conductor in the DTC and on the intervening night of 19th/20th April, 1991 when the workman was on duty, as surprise checking team entered the bus and found that 12 passengers who were travelling in the bus were not issued tickets by the Conductor despite collecting the cash from the. Hence a charge sheet was served

After a detailed enquiry, the removal of the workman was recommended and accordingly he was terminated. Thereafter, the workman sought reinstatement to which he received no response, due to which he filed a claim before the labour court and the Labour Court set aside the enquiry proceedings holding that the enquiry was held in violation of principles of natural justice.

Later on, fresh evidence adduced by the DTC for proving misconduct of the Conductor the Labour Court dismissed the claim of the workman.

Analysis, Law and Decision

High Court found that the Workman in his testimony admitted that he was working as a Conductor with the DTC and he denied the suggestion put to him that he had not issued tickets to the 12 passengers and admitted that there were 5 adverse entries against him.

Management’s witness denied the fact that the Conductor had issued tickets to all the passengers and further denied that the checking report was false. The witness also testified that the Conductor had misbehaved during the time when the checking staff had entered the bus.

Instant case was a case of misconduct by the workman and the dismissal had taken place more than 30 years ago.

There was no dispute over the fact that the statement of one of the passengers was recorded, placed on record and exhibited.

The Court opined that the testimony of the workman was clearly unreliable and untrustworthy, and the testimony of the Management witness had been unimpeached leading to the inescapable conclusion that misconduct was indeed committed by the Workman.

Bench reiterated that it is a settled position that,

“Customers need not be produced in such proceedings.”

 Recently, in Asst. General Manager, State Bank of India v. Ashok Kumar Bhatiya, WP(C) 7584/2017, this Court has reiterated that customers need not be produced for proving misconduct or irregularities, as it leads to the greater inconvenience for the customer which the Management sees to avoid under all circumstances. Moreover, this Court in the case of Delhi Transport Corporation v. Shree Kumar, 2004 SCC OnLine Del 557 has squarely dealt with the issue of non-production of passengers as a witness in the domestic enquiry or before the Labour Court and held that production of a passenger is not required to prove the misconduct of the Workman.

Further, in Dayal Singh v. DTC, 2013 SCC OnLine Del 995, it was held that it is not mandatory that passenger witnesses should depose to establish guilt.

Therefore, the misconduct having been established on facts in a detailed award passed by the Labour Court, the said order of the Labour Court did not warrant any interference. [Biri Singh v. DTC, 2022 SCC OnLine Del 286, decided on 27-1-2022]


Advocates before the Court:

For the petitioner: Vinay Sabharwal, Advocate

For the respondent: Aditi Gupta, Advocate

Case BriefsSupreme Court

Supreme Court: While hearing the appeal filed by Maharashtra SRTC, the Division Bench comprising of M. R. Shah* and B. V. Nagarathna, JJ., held that punishment of dismissal from service per se cannot be said to be an unfair labour practice for being disproportionate to the misconduct proved.

Background

On 23-10-1992 when the respondent, a bus driver employed by the MSRTC, was driving a bus, he met with an accident with a jeep coming from the opposite direction. The allegation against the respondent-driver was that instead of taking the bus to the left side, he took the bus to the extreme right and as a result, the jeep and the bus collided. The accident resulted in death of four passengers on the spot and six passengers were seriously injured. The impact of the collision was so high that the jeep was pushed back by about 25 feet. The driver of the jeep also sustained injuries. The respondent was subjected to disciplinary enquiry, and was consequently dismissed from service. A criminal case was also lodged against the driver under Section 279 of IPC for negligent and rash driving. However, he came to be acquitted.

Findings of the Labour Court and Industrial Tribunal

The Labour Court upheld the order of dismissal. In a revision application the Industrial Tribunal considering the acquittal of the respondent in criminal proceedings and observing that the drivers of both the vehicles were negligent (contributory negligence), the Industrial Tribunal exercised powers under item 1(g) of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971; and held that the order of dismissal was disproportionate to the misconduct proved. Hence, the Tribunal ordered reinstatement of the respondent without back wages but with continuity of service.

Dismissal by the High Court

The order of the Tribunal was challenged before the High Court by the appellant-MSRTC. The High Court, by the impugned order and judgment had only dismissed the appeal but also directed the appellant to pay to the respondent back wages with effect from 01-11-2003 to 31-05-2018 i.e. which was the date of his superannuation. The High Court also directed that the respondent should also be entitled to retiral benefits on the basis of continuity of service.

Factual Analysis

Noticing that while acquitting the accused–respondent the Criminal Court observed that the prosecution failed to prove that the incident occurred due to rash and negligent driving of the accused-respondent only and none else, and acquitted the respondent by classifying the case as one of a contributory negligence, the Bench stated that even if it was assumed that even driver of the jeep was also negligent, that did not that the respondent was not negligent at all. Hence, it could not absolve him of the misconduct.

Further, the Criminal Court acquitted the respondent on the hostility of the witnesses; the evidence led by the interested witnesses; lacuna in examination of the investigating officer; panch for the spot panchnama of the incident, etc. On the contrary in the departmental proceedings the misconduct of driving the vehicle rashly and negligently which caused accident and due to which four persons died has been established and proved. Therefore, the Bench said,

“An acquittal in a criminal trial has no bearing or relevance on the disciplinary proceedings as the standard of proof in both the cases are different and the proceedings operate in different fields and with different objectives.”

Therefore, the Bench concluded that the Industrial Court had erred in giving much stress on the acquittal of the respondent by the criminal court.

Whether punishment of dismissal can be said to be an unfair labour practice for being disproportionate to the misconduct proved?

The Bench observed that the Labour Court did not interfere with the order of dismissal by giving cogent reasons and after re-appreciating the entire evidence on record including the order of acquittal passed by the criminal court. However, the Industrial Tribunal interfered with the order of dismissal solely on the ground that punishment of dismissal was disproportionate to the misconduct proved and the same can be said to be to be unfair labour practice as per item 1(g) of Schedule IV of the MRTU & PULP Act, 1971. The Bench stated,

Clause No. 1(g) can only be invoked in a case where it is found that dismissal of an employee is for misconduct of a minor or technical character, without having any regard to the nature of the particular misconduct or the past record of service of the employee, so as to amount to a shockingly disproportionate punishment.

However, as per the appellant, the respondent was in service for three years and during three years’ service tenure he was punished four times, therefore, the Bench opined that it could not be said that the order of dismissal was without having any regard to the past record of the service of the respondent. Consequently, the Industrial Court wrongly invoked clause 1(g) of Schedule IV of the MRTU & PULP Act, 1971 as it could not be said that the dismissal of the respondent was for misconduct of a minor or technical character, without having any regard to the nature of the misconduct.

Conclusion

In the backdrop of above, the Bench concluded that the Industrial Court committed a grave error and had exceeded in its jurisdiction while interfering with the order of dismissal passed by the disciplinary authority. Similarly, the impugned judgment of the High Court directing the appellant to pay wages to the respondent also could not have been passed in a petition filed by the appellant. The Bench explained, it was not a petition filed by the workman and the relief granted was beyond the scope and ambit of the controversy before the High Court.

Accordingly, the impugned order and judgment was quashed and set aside and the judgment and Award of the Labour Court was restored. The order of dismissal passed by the disciplinary authority was upheld.

[Maharashtra SRTC v. Dilip Uttam Jayabhay, 2022 SCC OnLine SC 1, decided on 03-01-2022]


*Judgment by: Justice M. R. Shah


Appearance by:

For Maharashtra SRTC: Mayuri Raghuvanshi, Advocate

For the Respondent: Nishanth Patil, Advocate


Kamini Sharma, Editorial Assistant has put this report together


 

Case BriefsHigh Courts

Bombay High Court: Bharati Dangre, J., Whether the Insurance Company can be absolved of its liability to pay compensation under the Employees Compensation Act, 1923, if the employee who has succumbed to an accident which took place during the course of employment, is a minor?

Appellants filed a claim based on the premise that the deceased was aged 18 at the time of the accident and was receiving wages of Rs 5,500 per month and compensation of Rs 6,22,545 was assessed.

The insurer opposed the above-said claim before the Commissioner/Labour Court, and it was disputed that the accident suffered by the deceased arose out of or in the course of employment with the OP.

Further, it was denied that there was any nexus between the alleged injury and the alleged accident and since the police papers revealed the deceased’s age was 15 years, it was stated that the claim was not maintainable under the Workmen’s Compensation Act, 1923, hence the same shall be dismissed.

Analysis, Law and Decision

Workmen’s Compensation Act, 1923 does not prohibit payment of compensation to a minor.

There is no age limit for a person to be employed as an employee under the Workmen’s Compensation Act, though Article of the Constitution of India, employment of child labour before 14 years in any factory or mine or any hazardous employment, there are enactments in the form of Child & Adolescent Labour (Prohibition & Regulation Act), 1986 where engaging services of children below 14, in any hazardous avocation, is an offence.

Elaborating further, it was stated that Workmen’s Compensation Act is a beneficial piece of legislation and if a person engaged by an employer, as an employee is a minor and his appointment, though is prohibited by any law in existence, meet with an accident and sustain a disability which can be a total or partial disability, the moot question is:

Whether an employee should be denied the compensation merely on the ground that the employer had engaged him by contravening the law and he shall be kept out of the benefits which would have been otherwise available to him on account of an accident which he has suffered, which occurred in his workplace and out of the course of his employment or whether his family can be denied compensation on his death?

Bench expressed that the impugned decision took a harsh stand and refused to fasten liability of compensation on the Insurance Company by recording that the deceased was a minor and insurance company was not liable to pay compensation on the said ground.

The insurance policy in the present matter clearly covered two persons and the liability covered a person employed by the insured for operation and maintenance or loading/unloading which covered a cleaner.

Labour Court’s approach defeated the very spirit and rationale behind the Employees Compensation Act and the claimants who were the parents of the deceased were held entitled to recover compensation only from the employer with very negligible chance of recovering the compensation.

High Court disapproved the above approach of the labour court and opined that the Insurance Company cannot be absolved of its liability to pay compensation to the claimants, the dependents of the deceased. Therefore, the impugned judgment of the Commissioner was modified to the limited extent of fixing the liability jointly and severally upon the employer and the Insurance Company.

First Appeal No. 246 of 2015

In this matter, Insurance Company was aggrieved by the award of compensation to the parents of the deceased, who succumbed to the injuries in the accident.

Labour Court had directed the employer and the Insurance company jointly and severally liable to pay compensation.

Claimant 1 had set up a claim under the Workmen’s Compensation Act by filing the application claiming that his son was employed by the OP on his Motor Tempo as loader and the said tempo met with an accident due to which the son died.

High Court stated that when the written statement on oath before the Commissioner and the certificate issued by the employer is juxtaposed against his statement recorded by the police during the course of investigation, the statement recorded under oath, admitting that deceased Deepak was his employee, assumed importance.

Bench expressed that in view of the inconsistency in the statement given to the police by the employer, denying any employer-employee relationship on one hand and the statement on oath filed in the form of written statement before the Commissioner, the Commissioner has rightly given weightage to the statement on oath and accepted the employer-employee relationship.

In view of the above, Court found no reason to interfere with finding of the Commissioner. [Mohammed Ali Abdul Samad Khan v. Dawood Mohd. Khati, 2021 SCC OnLine Bom 6670, decided on 10-12-2021]


Advocates before the Court:

Mr. Amol Gatne i/b Ms. Swati Mehta for the appellants in First Appeal No.169 of 2014 and for the respondents in First Appeal No.246 of 2015.

Mr. D.R. Mahadik for the appellant in FA No.246/2015 and for respondent in FA No.169/2014.

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 BriefsHigh Courts

Allahabad High Court: Siddhartha Verma, J. reiterated the law laid down by the Supreme Court in Lal Mohammad v. Indian Railway Construction Co. Ltd., (2007) 2 SCC 513, wherein it was decided that when a workman is employed for a particular project then the services of that employee came to an end as soon as the project was over and he could not be given permanent status. It was also held that shortfall of period of notice or compensation, after completion of the project would not render the termination bad on that count.

The instant writ petition was filed challenging the award passed by the Labour Court. The petitioner was employed by the Indian Railway Construction International Ltd. initially as a peon on casual basis for period of six months by the order of the Project Manager, Vindhya Nagar. After completion of such service, the petitioner was re-employed on monthly basis and was attached with Anpara Project. This was done by the order of Regional Manager IRCON – Anpara. He continued for four years in this arrangement, after which he was brought in the regular scale. Thereafter, he was transferred to another Rihand Nagar Project. However, subsequently, his services were dispensed with. The petitioner raised an industrial dispute praying for reinstatement with back wages pursuant to which the Labour Court passed the order which was challenged by the petitioner in the instant writ petition.

At the outset, the Court noted that several other workmen of the Company who were found surplus and their services were also dispensed with, had filed writ petitions before the High Court. After moving to and fro, the case ultimately reached for decision in appeal before the Supreme Court in Lal Mohammad v. Indian Railway Construction Co. Ltd., (2007) 2 SCC 513. The Supreme Court found that the petitioners were not entitled to be regularised in the services of the Company as they were not employees of the company. It, however, held that the petitioners were entitled to compensation and thereafter the appeals were dismissed.

The petitioner in the instant writ petition claimed that his case was different from the case of Lal Mohammad. However, after hearing the parties and perusing the written arguments and also going through the award, the High Court found that no interference was warranted in the award of the Labour Court. It was observed:

“The Supreme Court in the case reported in Lal Mohammad v. Indian Railway Construction Co. Ltd., (2007) 2 SCC 513 has categorically laid down that when a workman is employed for a particular project, the services of that employee came to an end when the project was over and, therefore, could not be given a permanent status. It has also held that the workman could not be considered as employee of the company under which various other projects ran.”

The High Court also found that there was similarity in the case of the instant petitioner and the case already decided. Under such circumstances, the writ petition was dismissed. [Bipin v. Union of India, 2021 SCC OnLine All 787, dated 25-10-2021]

Case BriefsHigh Courts

Bombay High Court: Reiterating the well-settled position that, contractual employees are not the employees of the principal employer, N.B. Suryawanshi, J., held that,

Contractual employees are engaged through contractors, their service conditions are governed by the contracts between them, hence in case of any grievance, they shall approach the contractor and not a principal employer.

Two Primary Questions:

  • Whether a complaint of contractual employees seeking to exercise their rights, as provided under the Maharashtra Industrial Relations Act, 1946 and Bombay Industrial Relations Rules, 1947, is maintainable under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971?
  • Whether contractual employees can file a complaint under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 for challenging the impugned order, which is not passed by the Principal Employer?

Factual Matrix

Petitioner-Original Respondent Company had 806 permanent employees working. Petitioner outsourced its peripheral activities to several contractors and for that purpose registered itself as the principal employer under Section 7 of the Contract Labour (Regulation and Abolition) Act, 1970.

Contracts of the petitioner have obtained license under Section 13 of the Act of 1970, there was no registered Trade Union in the local area of the petitioner establishment.

Respondent 16 – Government Labour Officer declared the election programme for conducting elections under Section 28 of the MR Act, for electing 5 representatives of the employees. 301 contractual workers submitted a representation stating to add their names to the voter’s list and to give them a right to vote.

For the above-stated representation, Management informed the contractual workers that the decision in the said regard cannot be taken by the Management and they may approach the Government Labour Officer or the Labour Commissioner. Some contractual workers submitted their representation to the Labour Commissioner seeking inclusion of their names to which the Commissioner rejected while citing the decision in Sunflag Iron & Steel Co. Ltd. v. State of Maharashtra, 2008 III CLR 983 contractual workers are not directly employed by the principal employer, and therefore, their names cannot be included in the voter’s list.

Respondents approached the Industrial Court and stated that the Labour Commissioner has committed unfair labour practice within the meaning of Item 9 o Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971.

Petitioner opposed the complaint stating the there was no employer and employee relationship between the complainants and the petitioner.

Industrial Court rejected the application but prima facie held that complaint is maintainable and it has jurisdiction to entertain it.

Petitioner submitted that Industrial Court has no power of superintendence over respondent 2 and therefore, the complaint is not maintainable and the same is liable to be rejected summarily.

Analysis, Law and Decision

Settled Legal Position

Contractual Employees are not employees of the principal employer.

In the decision of Supreme Court, Vividh Kamgar Sabha v. Kalyani Steel Ltd., (2001) 2 SCC 381, it was held that “the provisions of MRTU and PULP Act can only be enforced by persons who admittedly are workmen. If there is dispute as to whether the employees are employees of the Company, then that dispute must be first be gotten resolved by raising a dispute before the appropriate forum. It is only after the status as a workmen is established in an appropriate Forum that a complaint could be made under the provisions of MRTU and PULP Act”

In Central Labour Union (Red Flag) Bombay v. Ahemdabad Mfg. and Calico Printing Co. Ltd., 1995 Supp (1) SCC 175, the Supreme Court held that “where the workmen have not been accepted by the Company to be its employees, then no complaint would lie under the MRTU and PULP Act.”

High Court opined that for a complaint to be maintainable under the MRTU and PULP Act, admitted employer and employee relationship is a pre-condition. The provisions of the MRTP and PULP Act can be enforced only after the status of a workman is established before an appropriate forum.

In the present scenario, the contractual employees are the employees of the contractor and not of the petitioner. Hence they are not entitled to file a complaint against the petitioner claiming commission of unfair labour practice.

Therefore, the complaint filed under MRTU and PULP Act by the respondents/contractual employees, is not maintainable.

Under MIR Act, jurisdiction is conferred with the Labour Court and the Industrial Court are conferred with the power to decide the disputes on reference. For enforcing the rights under the MIR Act, forum is provided.

Bench opined that for enforcing the rights available under the MIR Act, a complaint cannot be filed under the MRTU and PULP Act.

Contractual employees are engaged through contractors, their service conditions are governed by the contracts between them. The appointment orders to the contractual employees are not given by the principal employer, but are given by the contractor. They work with the principal employer through contractor, only during the contract period. After the contract period is over, their contractor may enter into a contract with another establishment and shift them to work there. From that view of the matter also, they cannot be treated like permanent employees of the principal employer, and therefore, they cannot claim voting rights at par with the permanent employees.

Since the contractual employees are governed by the contract between contractors, their service conditions, wages, etc. are also governed by the same, hence in case of any grievance they shall approach the contractor and not the principal employer.

Misread and Misconstrued

Industrial Court had ignored the settled legal position that the complaint of unfair labour practice was maintainable only if there was admitted employer and employee relationship between the parties. The contractual employee, being the employee of the contractor and not of the principal employer, cannot file a complaint under the MRTU and PULP Act.

Therefore, Industrial Court’s decision was unsustainable.

While allowing the petition, Court concluded stating that complaint filed under the MRTU and PULP Act by the contractual employees for exercising their rights under the MIR Act is not maintainable and the Industrial Court has no jurisdiction to entertain it. [Mahindra and Mahindra Ltd v. Satish, 2021 SCC OnLine Bom 3003, decided on 20-09-2021]


Advocates before the Court

Shri. R. B. Puranik, Advocate for the Petitioner

Shri. S. B. Dhande, Advocate for the Respondent Nos.2 to 11 and 13 to 15

Ms. T. H. Khan, Asst. G. P. for the Respondent Nos. 16 to 17.

Case BriefsHigh Courts

Delhi High Court: Prathiba M. Singh, J., while reiterating that there is no absolute bar on legal practitioners representing Management before Labour Courts, observed that:

Judicial decisions on the question of consent, including implied consent, have primarily turned on the facts of each case.

Instant petition challenged the order by which Counsel for the Petitioner-Management was not permitted to represent his client before the Industrial Tribunal.

Counsel for Petitioner-Management submitted that the impugned order was completely contrary to the prevailing law on the issue inasmuch as Advocates are permitted to represent the management, so long as there was no objection by the workman or the litigation expenses were paid.

Further, the Counsel submitted that the authorized representative of the Management was appearing at the time when pleadings were being exchanged and other procedural formalities were being completed. However, when the matter reached the stage of trial, the Management thought it fit to engage the services of an Advocate for tendering evidence and conducting cross-examination. Accordingly, Counsel Sabharwal had been engaged in the matter.

Adding to the above, Counsel submitted that it is the usual practice before Labour Courts that Advocates appear and represent the management as well as the workmen.

In the present case, Rajesh Khanna was an authorized representative for the Workmen and one such representative of the trade union, regularly appearing for workmen before the Labour Courts. He submits that the Management would be enormously prejudiced if the Workmen are permitted to be represented by an expert and the Management is not allowed to engage an Advocate.

Analysis, Law and Decision

Question for consideration is in respect of the representation of Advocates before the Labour Courts.

As per Section 36(4) of the Industrial Disputes Act, 1947, both parties i.e., the workmen and the management, are permitted to be represented by a legal practitioner with the consent of the other party and with the leave of the Court

From the judgement in Paradip Port Trust, Paradip v. Workmen, (1977) 2 SCC 339, it is clear that there is no absolute bar and if consent is given by the workmen, a lawyer can appear before the Labour Court.

Whether there was consent – implied or expressed, and whether leave ought to be granted by the Adjudicator concerned.

In the recent decision of the Supreme Court in Thyssen Krupp Industries India Private Limited v. Suresh Maruti Chougule [Civil Appeal No. 6586/2019], the clear conclusion would be that a legal practitioner can represent the management before the Labour Court, if the litigation expenses for the workman to engage the advocate are paid by the management.

“…as the matter reaches trial, it would be inapt to say that the management or the workmen would not be entitled to engage Advocates or legal practitioners to represent them, in accordance with law. If the Management wishes to be represented by a legal practitioner, the Court can consider the question of whether the workman has given consent or not, whether impliedly or otherwise. “

Court directed that the parties shall appear before the Labour Court on 20-09-2021.[A&B Fashions (P) Ltd. v. Ramesh Kumar, WP (C) 8929 of 2021, decided on 24-08-2021]


Advocates before the Court:

For the Petitioner: Vinay Sabharwal, Advocate

Mr Raj Birbal, Ms Raavi Birbal and Mr Gunjan Singh, Advocates assisting the Court

Jharkhand High Court
Case BriefsHigh Courts

Jharkhand High Court: S.N.Pathak, J., held that the employees of Telco Recreation Club cannot claim parity in pay and other benefits at par with the regular employees of Telco Ltd. The Bench held that,

“When the initial appointment letter of the workmen has not been issued by the petitioner-Management, the question of parity in pay etc. with the employees of the petitioner-Management does not arise.”

Factual Matrix of the Case

The petitioner Company-Telco Ltd., was a leading manufacturer and seller of automobiles in the Country. In 1958, the company had started a separate department under the name and style of “Telco Recreation Club” for carrying activities of welfare and recreation of its employees. The said Telco Recreation Club was a Society registered under Societies Act having a separate legal entity of its own with its own source of income, its own constitution and bye-laws and had no direct connection with the petitioner-company and the petitioner company, under its corporate responsibility, provide financial assistance to several Societies in the area including the said Club.

The case of the petitioner-company was that it had no control over TELCO Recreation Club, which was run and managed by a Managing Committee elected/ selected by its members, yet one Indra Deo Prasad on behalf of 21 persons employed in Telco Recreation Club made a claim of parity in pay and other benefits at par with the regular employees of Telco Ltd. It was also the stand of the company that the government of Bihar had found Telco Recreation Club to be an independent establishment and had made a reference being Ref. Case No. 06 of 1991 to Industrial Tribunal, Ranchi, which was never challenged or objected by the employees of the said Club and therefore, the petitioner-company could not be treated to be the employer of the workmen of Telco Recreation Club.

Decision by the Labour Court

 The Labour Court held that there existed a relationship of employer and employees between the parties, and Telco Recreation Club was a department/wing of the company, and that petitioner-company provided all facilities to said Club and had direct control over the Managing Committee of the said Club as the General Manager of Telco Ltd. was the President of the Club; the reference was maintainable. The Labour Court had further held that the concerned workmen were also permanent employees of  Teclo Ltd., and hence, they were entitled to get pay and other benefits at par with the employees of Telco Ltd. Accordingly, the issue was decided in favour of the workmen.

Findings of the Court

Considering the rival submission of the parties and on perusal of Judgments brought on record, the Bench reached the conclusion that the impugned Award suffered from patent illegalities and was based upon errors of law. Admittedly, there was no relationship of employer-employee between the petitioner-Management and the concerned workman. The Bench clarified,

“Neither in the appointment of workmen nor in the process of their engagement, the petitioner-Management has played any role, therefore, the industrial disputes against the petitioner-Management is wholly illegal and uncalled for.”

The concerned workmen were being governed by the rules, regulations and bye-laws of the Club and not the petitioner-Management. Even the disciplinary control was of the Club and not of the Management. Hence, the findings of the Tribunal were totally perverse and error of law. Finding force in the arguments of the petitioner-company that the Club was incorporated as a separate body and concerned workmen were admittedly appointed by the Club and not by the petitioner-Management, the Bench opined that the claim of the concerned workmen was not sustainable.

Reliance was placed by the Court upon the decision of Supreme Court in Bengal Nagpur Cotton Mills v. Bharat Lal, (2011) 1 SCC 635,  wherein it had held that two of the well-recognized tests to find out whether the contract labourers are the direct employees of the principal employer are-

  • Whether the principal employer pays salary instead of the contractor?
  • Whether the principal employer control and supervises the work of the employees?

Accordingly, the Bench held that in the instant case on both these counts, the workmen had failed to establish their case as they could not establish that they were working directly under control and supervision of the management, hence, the question of the employer-employee relationship did not arise at all.

Placing reliance on Bhuwanesh Kumar Dwivedi v. Hindalco Industries, (2014) 11 SCC 85,wherein, the Supreme Court had held that, “where Labour Court commits patent mistake in law in arriving at a conclusion contrary to law, the same can be corrected by the High Court. In the instant case, the Tribunal has committed a patent error of law to hold that the employer-employee relationship exists between the petitioner-Management and the concerned workman”; the Bench opined that

“In the instant case, the concerned workmen have sought for parity in pay and other benefits at par with the regular employees of TELCO Ltd. whereas the fact is that the petitioner-Management has never issued appointment letters to them rather these workmen were appointed by the Club, which is a separate entity.  When the initial appointment letter of the workmen has not been issued by the petitioner-Management, the question of parity in pay etc. with the employees of the petitioner-Management does not arise and as such the impugned Award suffers from patent illegalities and is fit to be interfered.”

In the backdrop of above, the impugned Award was quashed.  [Management of Motors Ltd. v. State of Jharkhand, 2021 SCC OnLine Jhar 413, decided on 18-06-2021]


Kamini Sharma, Editorial Assistant has reported this brief.


Appearance before the Court by:

For the Petitioner: Sr. Adv. Kamal Nayan Choubey, Sr.Adv. V.P. Singh, Adv.  Amit Kumar Das, Adv. Rashmi Kumar and Adv. Arun Kumar Singh

For the Respondents:     Sr. Adv. Ajit Kumar and Adv. Kumari Sugandha

For the State: GP-III O.P. Tiwari

Case BriefsSupreme Court

Supreme Court: The 3-judge bench of L. Nageswara Rao, Navin Sinha and Indu Malhotra* has set aside the impugned judgment of Uttaranchal High Court, whereby the High Court had set aside the award passed by the Labour Court on the ground that no disciplinary enquiry was held by the School regarding alleged abandonment of service by the respondent.

Background

 The Respondent was initially engaged as an Assistant Teacher in Jai Bharat Junior High School, Haridwar during the period July, 1993 to 21-05-1994, which was an unaided private institution. Subsequently, she worked as a Clerk from 01-07-1994. From 24-05-2005 the School started receiving grants-in-aid from the State, and came to be governed by the Uttaranchal School Education Act, 2006. The Respondent filed a complaint before the School contending that she had worked continuously up to 07-03-2006. It was that her services were illegally retrenched since 01-07-1997 without granting her any hearing, or payment of retrenchment compensation. The school, on the other hand, argued that on account of her continuous absence, the School had to engage another clerk in her place. The Respondent never made any grievance about her alleged termination till 2006, which was made after 9 years only when the School started receiving grants-in-aid from the State and became a Government School. It was further argued that the employment of the respondent was illegal, since the father of the respondent was a member of the Managing Committee, and her mother was the Chairman employed by the School. It was also stated that minimum qualification requirement for teachers was of B.Ed. and Teacher training while the respondent was only 12th passed.

Findings of the Courts Below

Labour Court vide Award dated 22-08-2016 held that the respondent was not entitled to get any relief as there was sufficient evidence adduced by the Management to prove her continued absence from the School since 01-07-1997. However, the said award of the Court was set aside by the High Court on the ground that the respondent had failed to discharge the onus to prove her employment till 08-03-2006. It was only after the School started receiving grants-in-aid, the respondent filed the present application after over 9 years. Hence, the High Court had set aside the Award dated on the sole ground that no disciplinary enquiry was held by the School regarding alleged abandonment of service by the respondent.

 Observation and Decision

The Bench cited Workmen of the Motipur Sugar Factory Private Ltd. v. Motipur Sugar Factory, (1965) 3 SCC 588, wherein, it had been held that, “A defective enquiry stands on the same footing as no enquiry and in either case the tribunal would have jurisdiction to go into the facts and the employer would have to satisfy the tribunal that on facts the order of dismissal or discharge was proper.”

Reliance was also placed on Workmen of Firestone Tyre & Rubber Co. of India (P) Ltd. v. Management of Firestone Tyre & Rubber Co. of India (P) Ltd., (1973) 1 SCC 813, wherein the Court had made following observations:

  • Even if no enquiry had been held by an employer or if the enquiry held by him is found to be defective, the Tribunal in order to satisfy itself about the legality and validity of the order; had to give an opportunity to the employer and employee to adduce evidence before it. It is open to the employer to adduce evidence for the first time justifying his action, and it is open to the employee to adduce evidence contra.
  • The effect of an employer not holding an enquiry is that the Tribunal would not have to consider only whether there was a prima facie case. On the other hand, the issue about the merits of the impugned order of dismissal or discharge is at large before the Tribunal, on the evidence adduced before it, has to decide for itself whether the misconduct alleged is proved. A case of defective enquiry stands on the same footing as no enquiry.
  • It has never been recognised that the Tribunal should straightaway, without anything more, direct reinstatement of a dismissed or discharged employee, once it is found that no domestic enquiry has been held or the said enquiry is found to be defective.
  • It has to be remembered that a Tribunal may hold that the punishment is not justified because the misconduct alleged and found proved is such that it does not warrant dismissal or discharge. The Tribunal may also hold that the order of discharge or dismissal is not justified because the alleged misconduct itself is not established by the evidence. Section 11-A now gives full power to the Tribunal to go into the evidence and satisfy itself on both these points.

The Court observed that full opportunity was given to the parties to lead evidence to substantiate their respective case and the High Court had not even adverted to the said evidence, and had disposed of the case on the sole ground that the School had not conducted a disciplinary enquiry before discharging the respondent from service. The School had led sufficient evidence before the Labour Court to prove that the respondent had abandoned her service from 01-07-1997 when she got married, and moved to another District, which was not denied by her in her evidence. The record of the School also revealed that she was not in employment of the School since July 1997.  The Bench stated,

“Only because some documents had not been produced by the management, an adverse inference could not be drawn against it.”

 In the light of above, it was held that initial employment of the respondent as a teacher from July 1993 to 21-05-1994 was itself invalid, since she was only inter-mediate, and did not have B.Ed. degree, which was the minimum qualification to be appointed as a teacher. Therefore, the impugned judgment of the High Court was set aside and the award passed by the Labour Court was restored. [State of Uttarakhand v. Sureshwati, 2021 SCC OnLine SC 34, decided on 20-01-2021]


*Justice Indu Malhotra has penned this judgment.


Kamini Sharma, Editorial Assistant has put this story together

Case BriefsHigh Courts

Bombay High Court: Anil S. Kilor, J., reiterated that the strict rule of pleadings as applicable to civil suits is not applicable under the Industrial Disputes Act, 1947.

The petitioner’s application under Section 33-C(2) of the Industrial Disputes Act, 1947 was rejected by the Labour Court, Nagpur and the Judgments and Order passed has been assailed in the present petition.

Petitioner had worked as a skilled worker with respondent scheduled employment “Printing Press”, to which provisions and schedule prescribed under the Minimum Wages Act, 1948 are applicable.

Claimed Permanency

He filed a complaint before the Industrial Court under Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices, 1971 claiming permanency.

On filing the above complaint, the petitioner was treated as a permanent employee by the respondent and therefore he withdrew his complaint.

However, the non-payment of the wages of permanent employee drove him to approach this Court.

Respondent stated that the petitioner was working as a skilled worker since 1989 and was getting benefits of permanent employee.

Further, the petitioner, subsequent to this, tendered his resignation, citing a reason that despite a statement made by the respondent before the learned Industrial Court and this Court that, the petitioner was a permanent employee, minimum wages have not been paid to him as per the provisions of the Minimum Wages Act.

Petitioner again took resort to the legal remedy by preferring n application under Section 33-C (2) of the Act, 1947 before the Labour Court for grant of arrears of wages and bonus for the period 11-08-1989 to 31-12-2013, as a ‘fitter’.

Analysis and Decision

Questions for Consideration:

1. Whether the Labour Court, possesses jurisdiction under Section 33-C(2)of the Act, 1947, to grant arrears of wages due under the Minimum Wages Act, particularly where there is no dispute regarding the rates of wages and it is admitted by the parties that minimum rates of wages were fixed by the Government?

2. Whether the strict rule pleadings is applicable to the Industrial disputes?

The purpose of enacting the ID Act, 1947 was to make provisions for the Investigation and settlement of Industrial Dispute and for certain other purposes.

Court also referred to Section 33-C (2) of the Act, 1947, which read as follows:

33C. Recovery of money due from an employer

(2) Where any workman is entitled to receive from the employer any money or any benefit which is capable of being computed in terms of money and if any question arises as to the amount of money due or as to the amount at which such benefit should be computed, then the question may, subject to any rules that may be made under this Act, be diecided by such Labour Court as may be specified in this behalf by the Appropriate Government.”

Language of the said Section makes it clear that:

“…if any question arises as to the amount of money due or as to the amount at which such benefit should be computed, then the question may, subject to any rules that may be made under this Act, be decided by Labour Court.”

Further to add to the above, if there is no dispute as to rates between the employer and the employee and the only question is whether a particular payment at the agreed rate is due or not, then Section 20(1) of the Minimum Wages Act would not be attracted at all, and the appropriate remedy would only be either under Section 15(1) of the Payment of Wages Act, 1936, or under Section 33-C(2) of the Industrial Disputes Act.

Court in view of Section 33-C(2) of the Act, 1947 and the facts laid, held that the Labour Court committed error in not exercising jurisdiction under Section 33-C (2) of the I.D. Act and further applicant also failed to prove that he was having the pre-existing right.

Bench referred to the decision of the Supreme Court in, Mumbai Kamgar Sabha v. Abdulbhai Faizullabhai, (1976) 3 SCC 832 and observed that 

I.D. Act, 1947 being beneficial legislation protects labour, promotes their contentment and regulates situations of crisis.

Mechanism of the Act is geared to conferment of regulated benefits to workmen and resolution, according to a sympathetic rule of law, of the conflicts, actual or potential, between managements and workmen.

Moreover an industrial dispute where the process of conflict resolution is informal, rough-and-ready and invites a liberal approach. Procedural prescriptions are hand-maids, not mistresses of justice and failure of fair play is the spirit in which courts must view processual deviances.

Hence, in light of the ID Act, 1947 being a beneficial legislation and strict rule of pleadings not made applicable, as applicable to the suits filed under the provisions of the Civil Procedure Code, Court stated that it is erroneous that the application was rejected under Section 33-C (2) on the ground of not sufficient pleadings being made.

Therefore, the impugned judgment and order passed by the Labour Court needs to be set aside and sent back to the Labour Court to decide the same afresh. [Tularam Manikrao Hadge v. Sudarshan Paper Converting, 2020 SCC OnLine Bom 965, decided on 21-09-2020]

Uttarakhand High Court
Case BriefsHigh Courts

Uttaranchal High Court: Sharad Kumar Sharma, J. contemplated the writ petition where the petitioner raised questions related to the order of the Labor Court passed in 2014.

The brief facts as involved in the instant writ petition were that the petitioner in the capacity of being an employer as a registered company under the Companies Act, had got different units and plants situated at various places, which required the services of certain workman in order to discharge the industrial work, which the unit had to undertake and in order to get the work performed in an efficient manner they required the services of Tool Room Trainee. Hence, the respondent was engaged as a Trainee with the said company and appointment made of the respondent for Trainee was governed by the terms and conditions of letter of appointment as it was provided in the letter of appointment itself issued. A certain stipend was fixed for the respondent. Subsequently the services of the respondent were put to an end on the grounds that the work and services were not satisfactory. The issue that arose afterwards was resolved between the parties.

Hence, the respondent filed an industrial dispute against the petitioner; consequently a proceeding was drawn before the Conciliation Officer and on the culmination of the said proceedings before the Conciliation Officer under Section 2-A of the U.P. Industrial Disputes Act, reference was sought to be made with regards to an adjudication of the controversy as raised by the workman. Consequently, a reference was made to the effect that as to whether and the act of the employer of dispensing the services of the petitioner as a tool room trainee was just and valid and to what benefit the trainee would be entitled to receive.

Labour Court ultimately by the impugned award had held that the act of the employer of dispensing the services of the respondent by an order was illegal and the workman was directed to be reinstated into the services.

Counsel for the petitioner Sudhir Kumar, submitted that in the said letter of appointment a clause was mentioned where the employer had reserved the rights to terminate the services of the trainee as any desired time without assigning any reason and even with put any prior intimation. He argued that while holding the termination as to be illegal the Labor Court had not treated that it was a reference which was made for defining the status of the workmen, as that of the respondent being of a regular employee.

Labor Court to the particular issue related to the status of the workman held that, it cannot in any manner be interpreted as if the petitioner was providing a regular status to the respondent as the effect of the award would be that as soon as the order was dispensed, the service of respondent was held to be bad in the eyes of the law, it will only give the respondent the same status of that being of a Tool Room Trainee from where he was removed, the post which he had acquired prior to his removal and thus he would be acquiring back the status of that of a Tool Room Trainee only, and the said award cannot be read as if it was giving him the status as that of a regular employee.

The Court observed that the clause of the terms of appointment would not come into play at the stage where the respondent was given a reason for his termination. More particularly, when had it been a simplicitor dispensation of service without attaching any stigma, then the employer could had exercised its power to dispense the services, but as soon as the employer attached a stigma and made any observation affecting the credibility with regards to the manner in which the work was performed by the trainee, it amounted to be a stigmatic order and in that eventuality, the adherence to the principles contemplated under the Industrial Disputes Act or under the principles of natural justice was required to adhere to prior to terminating the services of the workmen.

Hence, it may not be treated to have an effect of providing the status of a regular employee to that of the respondent was absolutely a misconception which was  drawn, because logically even otherwise also, if the order of termination was set aside, it goes without saying that the effect of setting aside of the termination order would only be revival of the status of the workmen, which was existing or he was enjoying in relation to the trainee which was prevailing at the time when the services were dispensed.[L.G. Balakrishnan & Bros Ltd. v. Virendra Singh, 2019 SCC OnLine Utt 646, decided on 02-07-2019]

Case BriefsHigh Courts

Madhya Pradesh High Court: Prakash Shrivastava, J. allowed the petition of the petitioner and held that in the absence of consent or in case of opposition by a party before the Labour Court, the other party cannot be permitted to be represented through an advocate as per Section 36(3) and (4) of the Industrial Disputes Act, 1947.

The petitioner has challenged the order of the Labour Court dated 8-10-2012, whereby the objection of the petitioner in respect of representation of the respondent in the proceedings before the Labour Court through the advocate has been rejected.

The facts of the instant case is that the reference has been made to the Labour Court under Section 10 of the Industrial Disputes Act in respect of retrenchment of the petitioner and in the proceedings before the Labour Court, the petitioner had raised an objection that the respondent cannot be allowed to be represented through the advocate as the petitioner has not appointed any advocate to represent him and in this regard has placed reliance upon Section 36(3) & (4) of the Industrial Disputes Act, 1947 and the Labour Court considering Section 30 of the Advocates Act has rejected the said objection.

The High Court held that since the petitioner has not consented to it and opposed it, the respondent-employer cannot be permitted to be represented before the Labour Court through the Advocate. In this regard, the Court placed reliance on the judgments of Uttam Kumar Pardasani v. Petcare Divin of Tetragon (P) Ltd. in Civil Appeal No. 561/11 and Itnas Pharmaceutical Ltd. v. Yogendra Singh Chouhan in WP No.6445/15.[Prakash Meena v. Ultratech Cement Ltd., 2019 SCC OnLine MP 1788, decided on 25-07-2019]

Patna High Court
Case BriefsHigh Courts

Patna High Court: The Bench of Shivaji Pandey, J. dismissed a writ petition filed by an employer, challenging the amount of compensation directed to be paid to its employee by the Labour Court, on the ground that the petitioner had not exhausted the alternative statutory remedy.

The instant petition was filed is challenging the order passed by the Presiding Officer of Bhagalpur Labour Court whereby and whereunder petitioner’s employee was awarded a compensation of around Rs 4.72 lakhs. Additionally, it was also ordered that if the said amount was not paid to the concerned employee within a period of thirty days, it would carry a simple interest of 12 percent on the principal amount of around Rs 2,03,771.

The Court noted that Section 30 of the Employee’s Compensation Act, 1923 has a provision of appeal. But instead of exhausting the alternative remedy of appeal, the present petition was filed directly before this Court. In view thereof, the petition was held to be not maintainable.

Accordingly, the petition was dismissed with a liberty to the petitioner to file an appeal as provided under Section 30 of the Employee’s Compensation Act.[Frontline (NCR) Business Solutions (P) Ltd. v. Anita Devi, 2019 SCC OnLine Pat 564, Order dated 19-04-2019]

Case BriefsHigh Courts

Delhi High Court: A Single Judge Bench comprising of Anu Malhotra, J. gave a decision by upholding the decision of Presiding Officer of Labour Court-X, Karkardooma, Delhi, regarding the illegal termination of services of the workmen.

In the present case, services of two work persons Laxmi and Raj Kumar were allegedly terminated by the management i.e. New Delhi Institute of Management.

It was contended by the management; both the work persons were appointed on ad hoc basis and thus the Minimum Wages Act, 1948 would not be applied. Nevertheless, both of them were paid the salary higher than the market standard. As per the statement of claim, the management was not providing the legal facilities such as PF, ESI, appointment letter, attendance card, leave book, payslip, annual and casual leave, overtime wages, bonus etc. to its employees and on their demanding the minimum wages, the management got annoyed with them and terminated the services of both the stated work persons on obtaining their signatures on blank papers. Further, their claim was entertained by the Labour Conciliation Officer but no settlement was arrived at.

Management had failed to prove that Raj Kumar had made a request for settlement of his dues as he had taken up some other job and similarly Laxmi had made a request for settlement of her dues as she was not in a position to continue her services and thus it was held that the management had failed to prove that the resignations were voluntary, which led to illegal termination of the workmen. Management had assailed the award contending the impugned award to be erroneous and proceeded on wrong presumption of law and facts.

Workmen had submitted that the management was misleading the Court by interpreting the salary vouchers as being towards ‘full and final’ settlement. The phrase ‘full and final payment’ was later inserted by the management malafide to thwart the course of justice. Further, the workmen contended that they had never resigned and their services were terminated by the management.

Hence, on consideration of the record available, the Court was of the view that the Labour Court’s decision cannot be faulted as there is no error of law that is apparent on the face of record of the impugned award. No requisite notice was issued to the workmen for termination of their services; they could have been terminated in accordance with Section 25 F of the Industrial Disputes Act, 1947, which having not been done so, it was rightly concluded by the labour Court that the termination of services of the workmen was in contravention of the law and was illegal.

The writ petitions were disposed of accordingly. [Laxmi v. New Delhi Institute of Management,2018 SCC OnLine Del 12290, decided on 03-11-2018]

Case BriefsSupreme Court

Supreme Court: Interpreting the provisions of Sections 33C(2) of the Industrial Disputes Act, 1947 vis-à-vis a Voluntary Retirement Scheme framed by the State of Andhra Pradesh, the Court said that though there is cessation of relationship between the employee and the employer in VRS but if it does not cover the past dues like lay-off compensation, subsistence allowance, etc., the workman would be entitled to approach the Labour Court under Section 33C(2) of the Act.

Explaining the position of law, the Court said that if the VRS had mentioned about the lay-off compensation, needless to say, the claim would have been covered and the amount received by the workmen would have been deemed to have been covered the quantum of lay-off compensation. If it is specifically covered, or the language of VRS would show that it covers the claim under the scheme, no forum will have any jurisdiction. However, on a perusal of the VRS framed by the State of Andhra Pradesh, the Court noticed that it did not deal with the lay-off compensation and hence, said that the workmen is entitled to approach the Labour Court.

The 3-Judge Bench of Dipak Misra, V. Gopala Gowda and Kurian Joseph, JJ was deciding the reference made by the 2-Judge Bench in an appeal from the decision of the Andhra Pradesh High Court where it was held that once the workmen had availed the Voluntary Retirement Scheme and received the special compensation package, they could not have put forth a claim for lay-off compensation under Section 33C(2) of the Act. [A. Satyanarayana Reddy v. Presiding Officer, Labour Court, 2016 SCC OnLine SC 1059, decided on 30.09.2016]