WP/14579/2009 of Mohd Gulam Gouse Vs The Assistant Commissioner of Labour on 31 December 2013

1. (2001) 2 SCC 542.(2005) 2 SCC 3633.(2006) 1 SCC 4794. (2013) 10 SCC 324

HON’BLE SRI JUSTICE A.RAMALINGESWARA RAO

WRIT PETITION Nos.23514 of 2000 and 14579 of 2009COMMON ORDER:

WP.No.23514 of 2000:

This writ petition was filed by the petitioner challenging thatportion of the Award in I.D.No.93 of 1999 dated 10.03.2000 denyingback wages.

The allegation of the petitioner was that he was appointed as aTongsman on 03.01.1980 on a monthly salary of Rs.300/- and hissalary was increased to Rs.1,600/- at the time of termination. Heplayed an active role in trade union activities of the 2[nd] respondentcompany and he was elected as a Vice President in the year 1981 andthereafter functioning as General Secretary in the year 1993. Thesettlement between the union and the 2[nd] respondent expired on30.06.1994. Therefore, he submitted the demands to the 2[nd]respondent on 27.06.1994 and the matter was admitted in conciliationon 11.09.1995. In view of his active participation in the trade unionactivities the 2[nd] respondent developed a vindictive attitude, inventeda charge and a charge sheet was issued on 18.09.1995. He wascharged with misconduct under Clause 20(h) of the Model StandingOrders and was also charged that he violated Clause 4 of the StandingOrders dated 03.01.1980. He offered his explanation on 02.12.1995. The 2[nd] respondent, having not satisfied with the explanation, orderedfor an enquiry. He was dismissed from service on 27.12.1995 pursuantto the enquiry report. He filed an application before the IndustrialTribunal, the 1[st] respondent under 2(A)(2) of the I.D. Act challenging the order of dismissal dated 27.12.1995 and it was initially numberedas I.D.No.8 of 1996 on the file of Labour Court, Hyderabad. Later on, itwas transferred to the 1[st] respondent Tribunal and was renumbered asI.D.No.93 of 1999. He filed his claim statement raising number ofobjections to the order of dismissal dated 27.12.1995. The Tribunal byAward dated 18.01.2000 held that the findings of the enquiry officerthat the petitioner was guilty of misconduct as per clause 20(4) ofModel Standing Orders was not correct. Accordingly, the order of thedismissal was set aside but denied the back wages. In that background, the present writ petition was filed.

Clause (4) of the letter of appointment reads as follows:

“During your term of employee with the company, you shall notserve any other employer or engage yourself in any other business oroccupation and shall devote your whole time and skill to the faithfuland diligent performance of your duties. You will be alwaysresponsible for your superiors.”

Clause (h) of Rule 20 of Model Standing Orders reads as follows:

“Habitual breach of any Standing order or any law applicable tothe establishment or any Rules made thereunder.”

Before the Industrial Tribunal, the petitioner filed Exs.W1 toW15 whereas the respondent did not file any documents and nonewere examined on either side. As aforesaid, the Tribunal gave afinding that the petitioner did not commit any misconduct under Rule20 of Model Standing Orders. Consequently, the order of dismissalwas set aside and the petitioner was directed to be reinstated inservice. With regard to the back wages the Tribunal held in para 8 ofthe Award as follows:

“In the result the order passed by the respondent in dismissing thepetitioner from service is set aside. The petitioner is entitled forreinstatement. Even though the petitioner is not guilty of misconduct underRule 20(h) of Model Standing Orders still the petitioner violated the conditionNo.4 of appointment order (Ex.W1) and hence I am not inclined to grant backwages to the petitioner. The petitioner is entitled for reinstatement withcontinuity of service but without back wages. The respondent is directed toreinstate the petitioner into service, with continuity of service but withoutback wages.”

Though the Tribunal held that the petitioner has violatedcondition No.4 of appointment order, there was no discussion withregard to the same in the Award. In any event that was relevant for thepurpose of considering the case for reinstatement. But the Tribunal,having ordered reinstatement, denied back wages. Now it has to beseen whether the Award of the labour Court so far as it denied backwages is correct or not.

The learned Counsel for the petitioner relied on the decisions ofthe Hon’ble Supreme Court reported in P.G.I. OF MEDICALEDUCATION & RESEARCH, CHANDIGARH Vs. RAJ KUMAR[[1]],KENDRIYA VIDYALAYA SANGATHAN AND ANOTHER Vs. S.C.SHARMA[[2]]and U.P. STATE BRASSWARE CORPORATIONLIMITED AND ANOTHER Vs. UDAY NARAIN PANDEY[[3]]. InRajkumar’s case (1 supra) the Supreme Court held that the payment ofback wages has a discretionary element involved in it and it has to bedealt with, in the facts and circumstances of each case and no straight-jacket formula can be evolved, though, however, there is statutorysanction to direct payment of back wages in its entirety. In S.C.Sharma’s case (2 supra) it was held that while determining theentitlement of a person to back wages, the employee has to show thathe was not gainfully employed. The initial burden is on him and afterhe places material in this regard the employer can bring on record thematerial to rebut the claim. In Uday Narain Pandey’s case (3 supra)also it was held that onus is on the employee to plead and prove thathe was not gainfully employed during the period for which back wageswere claimed having regard to the provisions of Section 106 of theEvidence Act or the provisions analogous thereto. In a recentjudgment of the Hon’ble Supreme Court reported DEEPALI GUNDUSURWASE Vs. KRANTI JUNIOR ADHYAPAKMAHAVIDYALA

(D.ED.) AND OTHERS[[4]], after reviewing the entire case law relating to payment of back wages in para 38 it was held as follows:

“The propositions which can be culled out from the aforementionedjudgments are:

i) In cases of wrongful termination of service, reinstatement withcontinuity of service and back wages is the normal rule.

ii) The aforesaid rule is subject to the rider that while deciding theissue of back wages, the adjudicating authority or the Court may take intoconsideration the length of service of the employee/workman, the nature ofmisconduct, if any, found proved against the employee/workman, thefinancial condition of the employer and similar other factors.

iii) Ordinarily, an employee or workman whose services areterminated and who is desirous of getting back wages is required to either plead or at least make a statement before the adjudicating authority or the Court of first instance that he/she was not gainfully employed or was employed on lesser wages. If the employer wants to avoid payment of fullback wages, then it has to plead and also lead cogent evidence to prove that the employee/workman was gainfully employed and was getting wagesequal to the wages he/she was drawing prior to the termination of service. This is so because it is settled law that the burden of proof of the existence ofa particular fact lies on the person who makes a positive averments about itsexistence. It is always easier to prove a positive fact than to prove anegative fact. Therefore, once the employee shows that he was notemployed, the onus lies on the employer to specifically plead and provethat the employee was gainfully employed and was getting the same orsubstantially similar emoluments.

iv) The cases in which the Labour Court/Industrial Tribunal exercises power under Section 11-A of the Industrial Disputes Act, 1947 and finds that even though the enquiry held against the employee/workman is consistent with the rules of natural justice and/orcertified standing orders, if any, but holds that the punishment wasdisproportionate to the misconduct found proved, then it will have thediscretion not to award full back wages. However, if the LabourCourt/Industrial Tribunal finds that the employee or workman is not at allguilty of any misconduct or that the employer had foisted a false charge, thenthere will be ample justification for award of full back wages.

v) The cases in which the competent Court or Tribunal finds that theemployer has acted in gross violation of the statutory provisions and/or theprinciples of natural justice or is guilty of victimizing the employee orworkman, then the concerned Court or Tribunal will be fully justified indirecting payment of full back wages. In such cases, the superior Courtsshould not exercise power under Article 226 or 136 of the Constitution andinterfere with the award passed by the Labour Court, etc., merely becausethere is a possibility of forming a different opinion on the entitlement of theemployee/workman to get full back wages or the employer’s obligation topay the same. The Courts must always be kept in view that in the cases ofwrongful / illegal termination of service, the wrongdoer is the employer andsufferer is the employee/workman and there is no justification to givepremium to the employer of his wrongdoings by relieving him of the burdento pay to the employee/workman his dues in the form of full back wages.

vi) In a number of cases, the superior Courts have interfered with theaward of the primary adjudicatory authority on the premise that finalization of

litigation has taken long time ignoring that in majority of cases the parties are not responsible for such delays. Lack of infrastructure andmanpower is the principal cause for delay in the disposal of cases. For thisthe litigants cannot be blamed or penalised. It would amount to graveinjustice to an employee or workman if he is denied back wages simply because there is long lapse of time between the termination of his service and finality given to the order of reinstatement. The Courtsshould bear in mind that in most of these cases, the employer is in anadvantageous position vis-à-vis the employee or workman. He can avail theservices of best legal brain for prolonging the agony of the sufferer, i.e., theemployee or workman, who can ill afford the luxury of spending money ona lawyer with certain amount of fame. Therefore, in such cases it wouldbe prudent to adopt the course suggested in Hindustan Tin Works PrivateLimited v. Employees of Hindustan Tin Works Private Limited (supra).

vii) The observation made in J.K. Synthetics Ltd. v. K.P. Agrawal (supra) that on reinstatement the employee/workman cannot claim continuity of service as of right is contrary to the ratio of the judgments of three Judge Benches referred to hereinabove and cannot be treated as good law. This part of the judgment is also against the very concept ofreinstatement of an employee/workman.”

In the instant case, the Tribunal denied the back wages solelyon the ground that the petitioner has violated condition No.4 ofappointment order. There was no discussion as to how he violated thesaid condition. The said ground cannot be based for denial of backwages, when the Tribunal held that the petitioner has not violated Rule20(h) of the Model Standing Orders. Rule 20(h) is dependant onclause 4 of the terms and conditions of appointment and when theTribunal gave a finding that Rule 20(h) was not violated itautomatically implies that the petitioner had not violated clause 4 of theterms and conditions of the appointment order. Further, it is not arelevant consideration for denial of back wages as already statedabove and what remains is virtually is there is no basis for denial ofback wages.

In the facts and circumstances of the case, the Award of thelabour Court in I.D.No.93 of 1999 dated 10-03-2000 to the extent ofdenial of back wages to the petitioner is set aside and consequently,the petitioner is held to be entitled to the back wages from the date oftermination of his service to the date of reinstatement.

W.P.No.14579 of 2009:

This writ petition was filed by the above petitioner challengingthe Award of the labour Court in I.D.No.237 of 2001 dated 31.03.2006dismissing his petition. His case was that subsequent to the passingof the Award in I.D.No.93 of 1999, he reported for duty on 10.06.2000and the 2[nd] respondent, instead of reinstating him, directed him toreport for duty before the Supervisor by name Mr.K.C. Paul, who wasnothing but a contractor. When he reported for duty before the saidSupervisor, he was asked to do manual work of lifting heavy ingotsand metal sheets. When he resisted and requested him to implementthe Award of the Industrial Tribunal, he was transferred fromHyderabad to Trichy on 21.02.2001. Then the petitioner objected tothe transfer on the ground that there was no factory of the respondentand his services were orally terminated. In those circumstances, hefiled I.D.No.237 of 2001. He also filed a detailed claim statementnarrating events which led to the filing of the petition.

Before the labour Court, the petitioner was examined as WW1and on behalf of the respondent, its finance manager was examined asMW1 and the petitioner marked Exs.W1 to W3 while the respondentmarked Exs.M1 to M9.

Before the labour Court, the petitioner contended that therespondent issued order of transfer and posted him at Trichy wherethere was no unit of respondent and therefore the order of transfer isnothing but an order of termination. The said contention was resistedby the respondent stating that during the pendency of the proceedingsin I.D.No.93 of 1999, the Poddar Projects Limited was taken over byMaharshi Commerce Limited during the year 1997 after dueamalgamation as per the directions of the Calcutta High Court. AfterMaharshi Commerce Limited took over, all its manufacturingoperations are carried out on contract basis by a different contractorand no reproduction workers are left over on the rolls of the companyas many of them left over the organization after settling their dues.

However with the consent of the petitioner, the respondentmanagement obliged to provide job but it was not specified. When atransfer order was issued to him with a view to provide appropriate jobat Trichy, the petitioner did not report for duty. The labour Court foundthat the transfer of the petitioner was made in view of the changedcircumstances and he was advised to take up the job at Trichy forwhich the petitioner was not willing to join. The labour Court also heldthat the name of the petitioner was still available on the rolls of thecompany and he was at liberty to join the duty as he was posted atTrichy and accordingly held that he was not dismissed from theservice. Since the service of the petitioner was not terminated ordismissed, he was not entitled for reinstatement and consequently thepetition was dismissed.

The learned counsel for the petitioner contended that the samelabour Court noticed in I.D.No.92 of 1999 and I.D.No.77 of 1999 filedby one Tribhuvan Singh and V.K. Mishra respectively, who wereearlier transferred in 1995 to Trichy that there was no branch of the 2[nd]respondent in Trichy. In those cases, the orders of transfer were setaside by the labour Court and they were directed to be reinstated inservice and hence the finding of the labour Court was not correct.

The labour Court noticed from the deposition of the petitionerwho was examined as WW1, that after the proceedings in I.D.No.93 of1999 when he was asked to report to duty at Maharshi CommerceLimited, the petitioner categorically stated that he was not prepared tojoin duty with the respondent at Trichy and he expressed hiswillingness to join duty if he was posted to Hyderabad. In thosecircumstances only the labour Court came to the conclusion that therewas no termination or dismissal from service and accordingly itdismissed the petition by order dated 31.03.2006. It cannot be heldthat the Award of the labour Court is erroneous. Consequently theaward of the labour court in I.D.No.237 of 2001 dated 31-3-2006 isconfirmed.

In view of the above, the award of the Labour Court in I.D.No.93of 1999 dated 10-03-2000 is set aside to the extent of denial of backwages to the Petitioner and W.P.No.23514 of 2000 is allowed holdingthat the petitioner is entitled to back wages from the date of dismissalfrom service on 27.12.1995 to 10.06.2000, the date on which hereported for duty.

W.P.No.14579 of 2009 is dismissed confirming the award of theLabour Court in I.D.No.237 of 2001 dated 31-3-2006. No order as tocosts.

As a sequel, Miscellaneous Petitions, if any, pending in thesepetitions shall stand closed.

Date: 31.12.2013Note: L.R. Copy to be marked(B/o)ska _______________________

A.RAMALINGESWARA RAO, J

[1](2001) 2 SCC 54

[2](2005) 2 SCC 363

[3](2006) 1 SCC 479

[4](2013) 10 SCC 324