According to the Development Staff Scheme, the
appellant is supposed to complete the target set forth for him for each
year of performance and also within the permissible cost as mentioned in
the Scheme. In 1991, due to the appellant’s personal problems in his
marital life, he was on leave, due to which he was chargesheeted on
1.4.1991 for his unauthorised absence and also because his business
performance had allegedly been very poor since 1985. An enquiry was
conducted against the appellant and based on the findings of the Enquiry
Officer on 16.12.1991, the appellant was issued a warning to mend himself
and make progress in the business of the respondent-Company. However, the
appellant was unable to achieve the premium targets for years 1991-92 and
1992-93 and therefore, he was issued with notice of termination dated
10.05.1993 on the ground that he had failed to conform to the stipulated
cost limit and therefore, his services were liable for termination. =
In our considered view, after examining the facts, circumstances and
evidence on record, it is clear that the order of termination against the
appellant on the ground that he failed to achieve the target fixed on him
by the respondent-Company for the particular year is erroneous.
single Judge of the High Court in this regard duly noted that there was no
record brought before the Court to show that there was a reduction of
emoluments for three consecutive years due to non-performance of work by
It was also rightly held by the learned single Judge that
neither the respondent-Company nor the Labour Court, have taken into
consideration the recommendation of the Branch Manager of the respondent-
Company and the explanation given by the appellant in his representation
challenging the order of termination passed against him.
In view of the above, the learned single Judge has rightly appreciated the
facts and circumstances of the case on hand and passed an order dated
1.2.2011 quashing the award of the Labour Court and directed the respondent-
Company to reinstate the appellant with all consequential benefits.
Further, the learned single Judge, keeping in view that the appellant was
terminated in the year 1993, directed the respondent-Company to pay 25%
back-wages to the appellant.
The learned Division Bench has erred in modifying the order passed by the
learned single Judge into one of stoppage of increment for a period of
three years with cumulative effect and set aside the direction of the
learned single Judge directing the respondent-Company to pay 25% back-wages
to the appellant.
The very idea of restoring an employee to the position which he held
before dismissal or removal or termination of service implies that the
employee will be put in the same position in which he would have been but
for the illegal action taken by the employer.
The injury suffered by a
person, who is dismissed or removed or is otherwise terminated from service
cannot easily be measured in terms of money.
With the passing of an order
which has the effect of severing the employer employee relationship, the
latter's source of income gets dried up.
Not only the concerned employee,
but his entire family suffers grave adversities.
They are deprived of the
source of sustenance. The children are deprived of nutritious food and all
opportunities of education and advancement in life.
At times, the family
has to borrow from the relatives and other acquaintance to avoid
These sufferings continue till the competent adjudicatory forum
decides on the legality of the action taken by the employer.
reinstatement of such an employee, which is preceded by a finding of the
competent judicial/quasi judicial body or Court that the action taken by
the employer is ultra vires the relevant statutory provisions or the
principles of natural justice, entitles the employee to claim full back
If the employer wants to deny back wages to the employee or contest
his entitlement to get consequential benefits, then it is for him/her to
specifically plead and prove that during the intervening period the
employee was gainfully employed and was getting the same emoluments.
of back wages to an employee, who has suffered due to an illegal act of the
employer would amount to indirectly punishing the concerned employee and
rewarding the employer by relieving him of the obligation to pay back wages
including the emoluments.
For the foregoing reasons, the impugned judgment and order of the
Division Bench of the High Court is set aside.
The appeal is allowed and
having regard to the facts and circumstances of this case, the respondent-
Company is directed to reinstate the appellant in his post and pay him 50%
back-wages from the date of termination till the date of reinstatement by
calculating the same on the basis of revision of pay scales of the
appellant and other consequential monetary benefits and pay the same to him
within six weeks from the date of receipt of the copy of this Judgment,
failing which the back-wages shall be paid with an interest at the rate of
9% per annum after the expiry of the said six weeks.
There shall be no order as to costs.-2015 .S.C.MSKLAWREPORTS