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Friday, April 17, 2015

The appeal of the workman is allowed. The judgment and orders of the learned single Judge and the Division Bench of the High Court are hereby set aside and the award of the Labour Court is restored in so far as the order of reinstatement is concerned; The respondent-Department is further directed to reinstate the workman in his post and pay 25% back-wages from the date of termination till the date of award passed by the Labour Court and full salary from date of award passed by the Labour Court till the date of his reinstatement by calculating his wages/salary on the basis of periodical revision of the same within six weeks from the date of the receipt of the copy of this judgment.

                         IN THE SUPREME COURT OF INDIA
                          CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO. 3701 OF 2015
                   (Arising out of SLP (c) 30561 of 2014)

GAURI SHANKER                          ............ APPELLANT
STATE OF RAJASTHAN                     ............ RESPONDENT

                               J U D G M E N T


    Delay condoned. Leave granted.

This appeal is directed  against  the  impugned  judgment  and  order  dated
4.4.2014 passed by the High Court  of Judicature of Rajasthan at Jodhpur  in
D.B. Civil Special Appeal (Writ) No. 54 of  2014,  wherein  the  High  Court
declined to interfere with the order dated 18.11.2013 of the learned  single
Judge passed in S.B. Civil Writ  Petition  No.  4253  of  2002  wherein  the
learned single Judge proceeded to consider the writ petition  filed  by  the
respondent-Department against  the  award  dated  28.6.2001  of  the  Labour
Court, Bikaner in Labour Dispute Case NO. 94  of  1994  whereby  the  Labour
Court  after  adjudication  of  the  points  of  dispute   held   that   the
retrenchment of the appellant-workman (for short  "the  workman")  from  his
services with effect from 1.4.1992 is improper and invalid and directed  the
employer for the reinstatement of the workman in his post.

Brief resume of facts are stated hereunder for the purpose  of  appreciating
the rival legal contentions to examine whether  the  impugned  judgment  and
orders passed by the Division Bench  of  the  High  Court  and  the  learned
single  Judge  warrant  interference  by  this  Court  in  exercise  of  its
appellate jurisdiction.

The workman was working in the  respondent-Forest  Department,  Chattargarh,
District  Bikaner  at  Rajasthan   State   (for   short   'the   respondent-
Department'). It is the case of the workman that he  was  appointed  against
the permanent and  sanctioned  post  with  effect  from  1.1.1987  till  his
services came to be retrenched, i.e. on 1.4.1992 and  has  rendered  service
of more than 240 days in every calendar year and has  received  salary  from
the respondent-Department each month. The workman aggrieved by the order  of
retrenchment passed by the respondent-Department has  raised  an  industrial
dispute questioning the correctness of the order in removing  him  from  his
service inter alia contending that the same is in violation of Sections  25F
Clauses (a) and (b), 25G and 25H of the Industrial Disputes Act, (for  short
"the Act"), therefore, the retrenchment of the workman from his  service  is
void ab initio in law and prayed for  setting  aside  the  same.  The  State
Government in exercise of its power referred the industrial dispute  between
the workman and the respondent-department to the Labour Court, Bikaner  vide
Notification No. P.1(1) [2234]Shrm Ni/93 dated  28.1.1994  for  adjudication
of the following points of dispute:-

"Whether removal of workman Gauri Shankar son  of  Bhairuan  (who  has  been
represented by the General Secretary,  Forest  Labour  Union,  Tyagi  Vatika
Jailwell,  Bikaner)  by  the  Employer,  Deputy   Conservator   of   Forest,
Chhattargarh, Bikaner is just and legal? If no, to what  relief  and  amount
the workman is entitled to?"

On receipt of the reference, both the parties filed their  respective  claim
statements in justification of their respective cases. It  is  the  case  of
the workman before the  Labour  Court  that  he  has  been  appointed  as  a
permanent workman in the permanent post  of  the  respondent-Department  and
that he has worked from 1.1.1987 till his termination from 1.4.1992  and  he
has been paid his salary on daily wage  basis  every  month  mentioning  his
name as a daily wage earner in the muster roll. The service of  the  workman
was retrenched by the respondent-Department allegedly  because  he  did  not
agree to join the new Union as per the  recommendation  of  the  respondent-
Department. It is contended on behalf of the workman that his  removal  from
service by the respondent-Department is otherwise misconduct on the part  of
the respondent-Department and  therefore,  it  amounts  to  retrenchment  as
defined under Section 2(oo) of the Act. Before  removing  the  workman  from
his services the respondent-Department neither published any seniority  list
nor followed the rule of first come last go and thereby there is  a  blatant
violation of Rules 77-78 of Rajasthan Industrial Disputes  Rules,  1958.  It
is also further stated that before  removing  him  from  the  services,  the
respondent neither issued one month's notice nor paid one month's wages  nor
obtained permission from the State  Government  to  retrench  him  from  the
services and also did not  pay  retrenchment  compensation  as  per  Section
25F(b) of the Act to the workman. Further, it is contended that the  act  of
the employer amounts to unfair labour  practice  as  defined  under  Section
2(ra) and prohibited under Section 25T of the Act for which the  respondent-
Department is liable for penal action as provided under Section 25U  of  the
Act. Therefore, the retrenchment of the workman is bad in law, as  the  same
is in blatant violation of Sections 25F, 25G, 25H, 25T and 25U  of  the  Act
and therefore, the order of retrenchment is rendered void ab initio in law.

The respondent-Department filed its reply statement denying the  claim  made
by the workman and stated that he was not appointed on any  post,  the  work
place as stated by him is at Dandi site of Sattasar Range  and  that  during
the period of last one year before the  alleged  retrenchment   he  has  not
worked even for a  day.  Further,  it  is  contended  that  the  respondent-
Department has not constituted any Union and that the  workman  was  neither
retrenched nor any provision of the Act and Rules have been  contravened  as
stated by  him  in  his  claim  petition.  Further,  it  is  stated  by  the
respondent-Department that from the perusal of  the  Government  record,  it
has been found that the workman has not worked even for  a  day  during  the
year 1991, and that he worked on casual  basis  in  November,  1988  for  26
days, in October, 1989 for 26 days, in  September,  1989  for  26  days,  in
June, 1989 for 26 days and in March, 1989 for 24 days and  that  in  between
these periods the workman was absent from work on his own  volition.  It  is
further contended by the respondent-Department that after November, 1989  up
to the date of retrenchment he has never been engaged for work and  did  not
attend for work without giving any  prior  notice/information  that  he  has
left the job on his own.  It  is  therefore  contended  by  the  respondent-
Department that it is neither an industrial dispute nor is the  appellant  a
workman and moreover, the  respondent-Department  is  not  an  industry  and
therefore, the dispute raised by the workman is not  an  industrial  dispute
and the Labour Court has no  jurisdiction  to  entertain  the  same.  It  is
further contended by  the  respondent-Department  that  there  has  been  an
extraordinary delay in raising the dispute,  without  assigning  proper  and
satisfactory explanation and the same is referred by  the  State  Government
to the  Labour  Court  for  its  adjudication.  Therefore,  the  respondent-
Department prayed for rejection of  the  order  of  reference  made  to  the
Labour Court.

Both the parties have adduced evidence before the Labour  Court  in  support
of their respective claim and counter claim. The Labour Court  has  examined
the evidence of the workman and the evidence of  Munnalal,  the  witness  of
the respondent-Department wherein, in his affidavit evidence he  has  stated
that the workman was posted as the Area Forest Officer  in  Sattasar  Forest
Division-Chattargarh from July, 1989 to May, 1991 and  further  stated  that
the contention of the workman that  he  was  removed  from  the  service  on
1.1.1991 is incorrect. It is further  elicited  in  his  evidence  by  cross
examination that there were many places of work and different  muster  rolls
were being used and maintained for each site and  he  has  further  admitted
that muster rolls of Dandi road site and Nursery (Dandi) both  are  separate
and muster rolls of Dandi road site were not produced. From the  submissions
made by the parties and perusal of the record,  the  Labour  Court  observed
that it  has  been  submitted  by  the  respondent-Department  that  in  the
reference of the industrial dispute there is  no  mention  of  the  date  on
which  the  workman's  services  were  dispensed  with  by  the  respondent-
Department and the one year prior  to  the  date  of  alleged  removal,  the
workman has not worked for a single day with the respondent-Department.  The
said contention of the respondent-Department was disbelieved by  the  Labour
Court and it has held that he has been removed  from  service  on  1.4.1992.
The Labour Court after referring to the judgments  of  this  Court  examined
the plea in the claim statements with regard to  the  date  of  removal  and
referred to the judgments of this Court in the cases of Madan Pal  Singh  v.
State of U.P. & Ors.[1], Samishta Dube v. City Board, Etawah &  Anr.[2]  and
H.D. Singh v. Reserve Bank of India & Ors.[3]  and on examining  the  muster
rolls of Dandi Nursery marked as Ext. M-1 to  25  it  was  held  to  be  not
proper.  Further,  it  has   held   that   the   respondent-Department   has
deliberately concealed the period of work of the workman in the  respondent-
Department though he has continuously worked  in  the  respondent-Department
from 1.1.1987 to March, 1992 i.e. for more  than  240  days  in  a  calendar
year. The Labour Court after hearing the parties and perusal of the  record,
adjudicated the points of dispute referred to it by answering  the  same  in
favour of the workman and holding that the respondent-Department  failed  to
comply with  the  mandatory  requirements  as  provided  under  Section  25F
clauses (a) and (b) and Sections 25G and 25H of the Act, therefore,  it  was
held by the Labour Court that the action of  the  respondent-Department  was
in contravention of the aforesaid statutory provisions of the Act and  Rules
77 and 78 of the Central Industrial Dispute Rules, 1957. Thus  it  was  held
by the Labour Court that the termination order passed  against  the  workman
is illegal and void ab initio in law and therefore, it has passed the  award
of reinstatement on 28.06.2001, but denied back-wages for  the  reason  that
he has not worked from 1.4.1992 till  passing  of  the  award.  Further,  on
account of the hardship and difficulties undergone  by  the  workman  during
the said period it has observed that he  is  entitled  for  compensation  of
Rs.2,500/- and he is also entitled for receiving salary  from  the  date  of
the award till the date of reinstatement.

The correctness of the award was challenged by the respondent-Department  by
filing a writ petition before the single Judge  of  the  High  Court  urging
certain legal grounds and questioned the  correctness  of  the  finding  and
reasons recorded by the Labour Court on the contentious points in the  award
holding that the workman has rendered 240 days of work in  a  calendar  year
and he has continuously worked from 1987 to  1992  and  prayed  for  setting
aside the same as it is erroneous in law by  placing  strong  reliance  upon
the Circular instructions dated 28.9.2012 and 23.10.2013 in relation to  the
industrial dispute cases for awarding compensation  of  Rs.2,500/-  for  the
hardship and difficulties suffered by the workman. The learned single  Judge
in his judgment observed that the Labour Court  arrived  at  the  conclusion
that the workman was discontinued from service from  1.4.1992,  and  further
the said finding is based on the conduct of the employer  in  not  producing
the relevant muster rolls maintained by them either before the Labour  Court
or before the learned single Judge of the High Court  or  without  assigning
any reason for non-production of the  relevant  records  which  must  be  in
possession and custody of the respondent-Department.

It was further observed by the single Judge that  the  workman  in  definite
terms has stated in his  affidavit  that  he  remained  in  service  of  the
respondent-Department till March  1992.  In  this  factual  background,  the
learned single Judge held that he did not find any fault  with  the  finding
rendered by the Labour Court that  the  workman  remained  in  service  till
March 1992 and that he was  retrenched  thereafter  from  his  service.  The
order of termination was held to be void ab intio in law  due  to  the  non-
compliance of the provisions of Sections 25F clauses (a) and  (b),  25G  and
25H of the Act and in normal course, its natural corollary is  reinstatement
in service. However, looking into the fact that the workman  was  retrenched
from his services back in March 1992 and that he was working just on  casual
basis, the learned single Judge held that the equities shall be balanced  by
awarding  compensation  of  Rs.1,50,000/-  in  lieu  of  reinstatement   and
accordingly, disposed of the case vide judgment and order dated  18.11.2013.
The correctness of the same is questioned by the workman  in  appeal  before
the Division Bench of the High Court. The Division Bench affirmed  the  said
view of the learned single Judge of  the  High  Court  vide  impugned  order
dated 04.04.2014. The correctness of the  same  is  challenged  before  this
Court urging various legal contentions.

The learned counsel for the workman  submits  that  once  the  Labour  Court
which is the fact finding court recorded the finding of fact  on  the  basis
of pleadings and evidence on record  and  answered  the  points  of  dispute
after adjudication of the same and held that the  termination  order  passed
against the workman is in violation of Sections 25F  clauses  (a)  and  (b),
25G and 25H of the Act, the High Court  has  exceeded  its  jurisdiction  in
exercise of its  Judicial  Review  power  under  Articles  226  and  227  of
Constitution of India in holding that the workman is a casual workman as  he
was intermittently working as a daily wage worker and therefore, he  is  not
entitled for reinstatement  as awarded by the Labour Court by following  the
principle of normal rule and further erroneously has  awarded  reinstatement
of  the  workman  and  compensation  of  Rs.2,500/-  for  the  hardship  and
difficulties suffered by him which is contrary  to  the  judgments  of  this
Court in a catena of cases.

It is further contended by the learned  counsel  that  the  High  Court  has
exceeded its jurisdiction in interfering with the finding of  fact  recorded
by the Labour Court on the points of dispute in  exercise  of  its  original
jurisdiction. The same  is  contrary  to  the  judgment  of  this  Court  in
Harjinder Singh v. Punjab  State  Warehousing  Corporation[4]  wherein  this
Court has referred to Syed Yakoob v. K.S. Radhakrishnan and Ors.[5].

The learned counsel for the respondent-Department has sought to justify  the
impugned judgment  contending  that  the  High  Court  in  exercise  of  its
extraordinary and supervisory jurisdiction has held that  he  was  a  casual
employee intermittently working with the  respondent-Department.  Therefore,
the compensation was awarded in lieu of  reinstatement  of  workman  in  his
post by applying the Circular instructions issued by the  State  Government;
the same need not be interfered with  by  this  Court  in  exercise  of  its
Jurisdiction as there is no mis-carriage of justice in the case on hand.

With reference to the aforesaid rival legal contentions urged on  behalf  of
the parties, we have to answer the following contentious issues  that  would
arise for our consideration :-

Whether the Labour  Court  was  justified  in  not  awarding  backwages  and
granting Rs.2,500/- as compensation in  lieu  of  backwages  though  it  has
awarded reinstatement in the absence of gainful employment of workman?

Whether the High Court in exercise of  its  supervisory  jurisdiction  under
Articles 226 and 227, is justified in interfering with the finding of  facts
recorded on the points of dispute recorded by the Labour Court in the  award
passed by it?

What award?

 The aforesaid contentious points are required to be answered in  favour  of
the workman for the following reasons:
     It is not in dispute that the workman was employed with the respondent-
Department in the year 1987 and on the basis of  material  evidence  adduced
by both the parties and in the  absence  of  the  non-production  of  muster
rolls on the ground that they are not available,  which  contention  of  the
respondent-Department is rightly not accepted by the  Labour  Court  and  it
has recorded the finding of fact holding that the workman  has  worked  from
1.1.1987 to 1.4.1992. The Labour Court  has  drawn  adverse  inference  with
regard to non-production  of  muster  rolls  maintained  by  them,  in  this
regard, it would be useful to refer to the judgment of  this  Court  in  the
case of Gopal Krishnaji Ketkar v. Mohd. Haji Latif  &  Ors.[6]   wherein  it
was held thus:

"5. .........Even if the burden of proof does not lie on a party  the  Court
may draw an adverse inference if he withholds  important  documents  in  his
possession which can throw light on the facts at issue. It is  not,  in  our
opinion, a sound practice for those desiring to rely upon  a  certain  state
of facts to withhold from the Court the best  evidence  which  is  in  their
possession which could throw light upon the issues  in  controversy  and  to
rely upon the abstract doctrine of onus of proof.  In  Murugesam  Pillai  v.
Gnana Sambandha Pandara Sannadhi, Lord Shaw observed as follows:

"A practice has grown up in Indian  procedure  of  those  in  possession  of
important documents or  information  lying  by,  trusting  to  the  abstract
doctrine of the onus of proof, and  failing,  accordingly,  to  furnish  to,
the, Courts the best  material  for  its  decision.  With  regard  to  third
parties, this may be  right  enough-they  have  no  responsibility  for  the
conduct of the suit but with regard to the parties to the  suit  it  is,  in
their Lordships' opinion an inversion of sound practice for  those  desiring
to rely upon a certain state  of  facts  to  withhold  from  the  Court  the
written evidence in their  possession  which  would  throw  light  upon  the

This passage was cited with approval by this Court in  a  recent  decision--
Biltu Ram & Ors. v. Jainandan Prasad &  Ors.  In  that  case,  reliance  was
placed on behalf of the defendants  upon  the  following  passage  from  the
decision of the Judicial Committee in Mt.  Bilas  Kunwar  v.  Desraj  Ranjit
Singh :-

"But it is open to a litigant to refrain from producing any  documents  that
he considers irrelevant; if the other litigant is  dissatisfied  it  is  for
him to apply for an affidavit of documents and he can obtain inspection  and
production of all that appears to him in such affidavit to be  relevant  and
proper. If he fails so to do, neither he nor the Court at his suggestion  is
entitled to draw any inference as to the contents of any such documents."

The said finding of the Labour Court is re-affirmed by  the  learned  single
Judge which also affirmed the finding that the  action  of  the  respondent-
Department in terminating the services of the workman w.e.f. 1.4.1992  is  a
case of retrenchment as defined under  Section  2(oo)  of  the  Act  as  the
termination of the services of the workman is otherwise  for  misconduct  by
the respondent-Department. Further, undisputedly the non-compliance  of  the
mandatory requirements as provided under  the  provisions  of  Sections  25F
clauses (a) and (b), 25G and 25H of the Act read with Rules  77  and  78  of
the relevant Rajasthan Industrial  Dispute  Rules,  1958  has  rendered  the
order of termination passed against the workman void ab initio in  law.  The
Labour  Court  in  the  absence  of  any  material  evidence  on  record  in
justification of the case of the respondent-Department has rightly  recorded
the finding of fact and held that the order of  termination  passed  against
the workman is bad in law, the same being void  ab  initio  in  law  it  has
passed an award for reinstatement of the workman in his post in exercise  of
its original jurisdiction under provision of Section  11  of  the  Act.  The
Labour Court has rightly followed the normal rule of  reinstatement  of  the
workman in his original post as it has found that the order  of  termination
is void ab-initio in law for non compliance with  the  mandatory  provisions
of the Act referred to supra. However, the Labour Court is  not  correct  in
denying backwages without assigning any proper and valid reasons though  the
employer did not prove either its stringent financial conditions for  denial
of back wages or that workman has been gainfully employed during the  period
from the date of order of termination till the award was  passed  in  favour
of the workman except granting Rs.2,500/- as compensation for the  suffering
caused to the workman. The same  is  erroneously  modified  by  the  learned
single Judge who recorded the finding of fact for the first time by  holding
that the  workman  is  a  casual  employee  intermittently  working  in  the
respondent-Department. The learned  single  Judge  of  the  High  Court  has
exceeded his jurisdiction under Articles 226 and 227 of the Constitution  of
India as per the legal principles laid down by this Court  in  the  case  of
Harjinder Singh (supra) wherein this Court has held thus:-
"17. Before concluding, we consider  it  necessary  to  observe  that  while
exercising jurisdiction under Articles 226 and/or 227  of  the  Constitution
in matters like the present one, the High Courts are duty bound to  keep  in
mind  that  the  Industrial  Disputes  Act  and  other  similar  legislative
instruments are social welfare legislations and the same are required to  be
interpreted keeping in view the  goals  set  out  in  the  preamble  of  the
Constitution and the provisions contained in Part IV thereof in general  and
Articles 38, 39(a) to (e), 43 and 43A in particular, which mandate that  the
State should secure a social order for  the  promotion  of  welfare  of  the
people, ensure equality between men and women and equitable distribution  of
material resources of the community to sub-serve the common  good  and  also
ensure  that  the  workers  get  their  dues.  More  than  41   years   ago,
Gajendragadkar, J, opined that "the concept of social and  economic  justice
is a living concept of revolutionary import;  it  gives  sustenance  to  the
rule of law and meaning and significance to  the  ideal  of  welfare  State"
- State of Mysore v. Workers of Gold Mines AIR 1958 SC 923."

The said principle has been reiterated by this  Court  in  Jasmer  Singh  v.
State  Of  Haryana  &  Anr.  (Civil  Appeal  NO.  346  of  2015  decided  on

 Therefore, in view of the above said case,  the  learned  single  Judge  in
exercise of its powers under Articles 226 and 227  of  the  Constitution  of
India erroneously interfered with the  award  of  reinstatement  and  future
salary from the date of award till date of reinstatement as  rightly  passed
by the Labour Court recording valid and cogent  reasons  in  answer  to  the
points of dispute holding that the  workman  has  worked  from  1.1.1987  to
1.4.1992  and  that  non-compliance  of  the  mandatory  requirements  under
Sections 25F, 25G and 25H of the Act by the  respondent-Department  rendered
its action of termination of the services of the workman as void  ab  initio
in law and instead the High Court  erroneously  awarded  a  compensation  of
Rs.1,50,000/- in lieu of reinstatement. The learned  single  Judge  and  the
Division  Bench  under  their  supervisory  jurisdiction  should  not   have
modified the award by awarding compensation in lieu of  reinstatement  which
is contrary to the well settled principles of law laid  down  in  catena  of
cases by this Court.

In view of the foregoing reasons, the modified award passed by  the  learned
single Judge of the High Court which was affirmed by the Division  Bench  of
the High Court has rendered the impugned judgment and order bad  in  law  as
it suffers from not only erroneous reasoning  but  also  an  error  in  law.
Therefore, the same  are  liable  to  be  set  aside.  Hence,  we  pass  the
following order:-

The appeal of the workman  is  allowed.  The  judgment  and  orders  of  the
learned single Judge and the Division Bench of the  High  Court  are  hereby
set aside and the award of the Labour Court is restored in  so  far  as  the
order of reinstatement is concerned;

The respondent-Department is further directed to reinstate  the  workman  in
his post and pay 25% back-wages from the date of termination till  the  date
of award passed by the Labour Court and  full  salary  from  date  of  award
passed  by  the  Labour  Court  till  the  date  of  his  reinstatement   by
calculating his wages/salary on the basis  of  periodical  revision  of  the
same within six weeks from the date of the  receipt  of  the  copy  of  this

                              [V.GOPALA GOWDA]


  New Delhi,
  April 16, 2015.
[1]     (2000) 1 SCC 683
[2]     (1999) 3 SCC 14
[3]      1985 ( 4 )  SCC  201
[4]    (2010) 3 SCC 192
[5]    AIR 1964 SC 477
[6]    AIR 1968 SC 1413


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