Termination of Service - claim before the Central Government Industrial Tribunal (referred to as “the CGIT”) claiming inter alia an enhanced severance package, waiver of outstanding Housing Loan, and full pension -The Ld. CGIT passed an Award dated 01.06.2009, and directed the R2Bank to reinstate the Appellant, with full terminal benefits. - Eventhough not claimed reinstatement - Writ filed - High court allowed writ and order to refund the excess amount she withdraw under various interim orders etc., and held that she voulantrily abonden the post eventhough offerred various alternative equal posts - termination of her service as her post as confidential secretary become reduntant as the Officer with whom the Appellant was attached, left the services of the R2Bank.- Appellant challenged the High court order - Apex court held that sec.25 F no notice is mandatory much more R2 Bank complied all necessary things under sec.25 F of I.D.Act -Once it is established that the Appellant had voluntarily abandoned her service, she could not have been in “continuous service” as defined under S. 2(oo) the I.D. Act, 1947. S. 25F of the I.D. Act, 1947 lays down the conditions that are required to be fulfilled by an employer, while terminating the services of an employee, who has been in “continuous service”
of the employer. Hence, S. 25F of the I.D. Act, would cease to apply on her.- Apex court modified the order of High court and allowed to record full statisfaction of entire claim /package in full and final settlement .
“REPORTABLE”
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOs. 1176611767 OF 2018
(Arising out of SLP (Civil) Nos. 3020530206 of 2017)
Manju Saxena …Appellant
Versus
Union of India & Anr. …Respondent(s)
J U D G M E N T
INDU MALHOTRA, J.
Leave granted.
1. The present S.L.P.s arise out of the impugned
Judgment dated 14.07.2017 passed in L.P.A. No.
467/2017, and Order dated 13.09.2017 passed in
R.P. No. 380/2017 of the Delhi High Court,
wherein the High Court dismissed the L.P.A filed by
1
the Appellant against the 2nd Respondent HSBC
Bank.
2. Briefly stated, the factual matrix in which the
present S.L.P. has been filed are summarized as
under:
2.1 The Appellant was appointed on 01.04.1986 as
a “Lady Confidential Secretary” by the 2nd
Respondent HSBC Bank, (hereinafter referred
to as “the R2Bank”).
Subsequently, on 23.04.1992 the Appellant
came to be promoted as a “Senior Confidential
Secretary” to the Senior Manager (North India)
of HSBC.
2.2 In May 2005, the post of “Senior Confidential
Secretary” became redundant, as the Officer
with whom the Appellant was attached, left the
services of the R2Bank. Her services were
utilized by giving her some other duties for the
time being, till alternate jobs could be offered to
her.
The Management admittedly offered her four
alternate jobs of (i) Business Development
2
Officer, (ii) Customer Service Officer, (iii)
Clearing Officer, and (iv) Banking Services
Officer. Each of these jobs were in the same pay
scale.
The Appellant has admitted in her Statement
of Claim dated 20.03.2006, that she declined to
accept any of these jobs on the ground that
such jobs were either temporary in nature, or
the claimant did not possess the experience or
workknowledge to take up such jobs.
2.3 On 01.10.2005, the Bank issued a Letter
terminating the services of the Appellant on the
ground that her current job had become
redundant. The Appellant was offered several
job opportunities, however, she did not choose
any of these offers. The Bank had offered a
generous severance package, which she was
not prepared to accept. The Bank terminated
her service, and paid 6 months’ compensation
in lieu of Notice as per the contract of
employment. In addition, as a special case, the
Bank paid Compensation, which was
3
equivalent to 15 days’ salary for every
completed year of service. The total amount
paid to the Appellant was Rs. 8,17,071/.
2.4 The Appellant raised an Industrial Dispute
before the Regional Labour Commissioner
under the Industrial Disputes Act, 1947
(hereinafter referred to as the I.D. Act) on
03.10.2005, and sought enhancement of the
severance package paid to her. It is relevant to
note that the Appellant did not raise any claim
for reinstatement to the R2Bank.
Conciliation proceedings were commenced
between the Appellant and R2Bank, wherein
the Appellant made the following claims:
HEADS AMOUNT (INR)
Severance 69,99,600.00
Provident Fund 8,90,111.60
Gratuity 3,81,209.00
Leave Encashment 86,541.40
Compensation + Notice Pay 8,17,071.00
TOTAL 91,74,533.00
4
The Bank, in response, offered the following
package:
HEADS AMOUNT (INR)
Severance 32,79,600.00
Provident Fund 8,90,111.60
Gratuity 3,81,209.00
Leave Encashment 86,541.40
Compensation + Notice Pay 8,17,071.00
TOTAL 57,29,533.00
The only difference between the two parties
was with respect to the amount of Severance
payable to the Appellant. Since the parties were
unable to arrive at a settlement, the
conciliation proceedings failed.
2.5 The Appellant filed her Statement of Claim
dated 20.03.2006, before the Central
Government Industrial Tribunal (referred to as
“the CGIT”) claiming inter alia an enhanced
severance package, waiver of outstanding
Housing Loan, and full pension. The Claim was
opposed by the R2Bank. The R2Bank filed its
5
Written Statement and contested the claim of
the Appellant, stating that the Appellant was
not a “workman” under the I.D. Act, 1947. The
Bank further stated that they had followed the
procedure outlined under the I.D. Act, while
terminating the services of the Appellant.
The Ld. CGIT passed an Award dated
01.06.2009, and directed the R2Bank to reinstate
the Appellant, with full terminal
benefits.
2.6 The R2Bank filed Writ Petition bearing No.
W.P. (C) 11344/2009 before the Delhi High
Court, to challenge the Award passed by the
CGIT. The High Court vide Interim Order dated
22.03.2013 remanded the matter to the CGIT
for fresh consideration on the point whether the
Appellant could be considered to be a
“Workman” as per the Industrial Disputes Act,
1947. The Writ Petition was kept pending
during the pendency of the remand. The CGIT
passed a fresh Award dated 15.07.2015 holding
6
the Appellant to be a “workman” under the I.D.
Act, 1947.
The Ld. CGIT directed the R2Bank to reinstate
the Appellant with continuity of service,
full back wages, and all consequential benefits.
2.7 During the pendency of the Writ Petition, the
Appellant had filed an Application under S. 17B
of the I.D. Act, 1947 before the Delhi High
Court seeking interim maintenance. The High
Court vide Interim Order dated 27.07.2012
directed payment of a monthly sum of Rs.
75,000/ to the Appellant, towards Interim
Maintenance u/S. 17B of the I.D. Act, 1947.
2.8 Aggrieved by the Order dated 27.07.2012, the
R2 Bank filed an L.P.A. before the Delhi High
Court to challenge the amount awarded to the
Appellant u/S. 17B. The Division Bench vide
Order dated 24.08.2012, reduced the monthly
sum payable to Rs. 58,330/ per month which
was as per her last drawn salary.
7
The S.L.P. filed by the Appellant being S.L.P. (C)
No. 36513/2012 to challenge the Order dated
24.08.2012, came to be dismissed vide Order
dated 07.01.2013.
The Appellant accordingly has been paid back
wages u/S. 17B at Rs. 58,330/ per month.
2.9 The Appellant also raised a claim for waiver of
the outstanding amount of a Housing Loan
availed by her during the course of her service,
which was outstanding on the date of her
termination. The total amount of outstanding
loan was approximately Rs. 22,16,702/.
The Appellant challenged proceedings for
recovery initiated by the R2Bank before the
Delhi High Court in W.P. (C) No. 19451/2006.
A Consent Order dated 18.03.2010 came to be
passed whereby the outstanding amount of Rs.
22,16,702/ towards the Housing Loan, was to
be adjusted from her back wages, subject to the
final outcome of the W.P. (C) No. 13344/2009.
8
2.10 The Writ Petition filed by the R2Bank was
allowed by the learned Single Judge vide
Judgment and Order dated 12.04.2017, and
the Award passed by the CGIT came to be set
aside.
The High Court accepted the R2Bank’s
submissions, and held that the Appellant’s
refusal to accept any of the four alternate
positions offered to her, amounted to
“abandonment” of her job. Hence there was no
question of her services having been illegally
terminated. The Appellant had received
monetary compensation under several heads,
to the tune of Rs. 1,07,73,736/ during the
pendency of the Writ Petition, which was
almost 13 times her legal entitlement. This
included payments made under the various
heads such as Compensation paid during
termination, Gratuity, Payment towards Interim
Award, Payments under S. 17B, Payment
towards legal expenses. The Appellant was
9
directed to refund the entire amount except the
sum of Rs. 8,17,071/, which was the
compensation paid at the time of termination.
2.11 Aggrieved by the Judgment & Order dated
12.04.2017 in W.P. (C) 11334/2018, the
Appellant filed L.P.A. No. 467/2017 before the
Division Bench. The Division Bench vide
Judgment & Order dated 14.07.2017 dismissed
the L.P.A., and upheld the Judgment of the
learned Single Judge holding that the Appellant
had abandoned her job.
The Division Bench however modified the
operative direction passed by the Ld. Single
Judge for restitution of the amounts paid. The
Division Bench ordered that the Appellant shall
not be required to restitute the amount of Rs.
8,17,071/ paid at the time of termination, the
litigation expenses, and the amounts paid
under S. 17B of the I.D. Act, 1947.
10
2.12 The Appellant filed Review Petition No.
380/2017 which was dismissed vide Order
dated 13.09.2017.
2.13 The Appellant has assailed the Judgment
dated 14.07.2017 and Order dated 13.09.2017
passed by the Division Bench in the L.P.A. and
the Review Petition, by the present S.L.P.s.
3. The Appellant was appearing in Person. Even
though the Court had made a suggestion that a
Counsel be appointed to represent her, she
declined the same. The submissions made by the
Appellants are:
3.1 The Appellant submitted that she is entitled to
a Severance Package of Rs. 69.99 lakhs, which
is equivalent to her last drawn salary of Rs.
58,330/ per month for a period of 10 years,
i.e. 120 months.
The calculations put forth by the Appellant is
as follows:
11
[Severance Package = Last drawn monthly
Salary x 120 months];
[Rs. (58,330 x 120) = Rs. 69,99,600/]
3.2 The Appellant submitted that she had been in
“continuous service” for over 20 years with the
R2bank. Consequently, she was eligible for all
benefits payable to a ‘workman’ under the I.D.
Act.
3.3 The Appellant further submitted that the terms
of the Housing Loan taken by her during the
course of service, provided for 782certain
relaxations and benefits to the employees. The
Appellant submitted that her outstanding loan
amount should be waived by the R2Bank.
3.4 The Appellant submitted that the R2bank had
been deducting T.D.S. on all the payments
made to her during the pendency of the legal
proceedings. The Appellant submits that this
deduction is illegal, and she is entitled to a
refund of a sum of Rs. 13,69,083/ deducted
towards T.D.S.
12
4. The R2Bank was represented by Mr. Dhruv Mehta,
Sr. Adv, alongwith Mr. Gagan Gupta, Adv, the
Counsel for the R2bank inter alia submitted:
4.1 It is the admitted position that the Appellant’s
post had become redundant when her boss left
the Bank. The Appellant was offered four
alternate positions of (i) Business Development
Officer, (ii) Customer Service Officer, (iii)
Clearing Officer, and (iv) Banking Services
Officer in the same pay scale. The Appellant
however declined each of these offers. In these
circumstances, her services came to be
terminated. As a special case, a severance
amount of Rs. 8,17,071/ was paid apart from
the other benefits.
4.2 It was further submitted that the Bank
complied with all the mandatory requirements
specified in S. 25F (a) and (b) of the I.D. Act.
The compensation of Rs. 8,17,071/ granted to
the Appellant, was computed in accordance
with S. 25F (b) i.e. compensation equivalent to
13
15 days’ salary multiplied by the number of
years of employment.
The High Court had recorded that the
Appellant had already received monetary
benefits in excess of the compensation she was
entitled to under the law. Therefore, the
Appellant was not entitled to any additional
amount.
4.3 The R2Bank submitted that during
Conciliation proceedings, they had offered a
Severance Package of Rs. 32.79 lacs which was
worked out on the basis of the last drawn Basic
Salary + Monthly Allowances, for past 10 years
(equal to 120 months). The Basic Salary was
Rs. 19,280/ and Monthly Allowances [H.R.A. +
Medical + L.T.A. of Rs. 8,050/]. The total basic
component was Rs. 27,330/ (19,280 + 8,050).
The severance package by the Bank was
computed as follows:
Severance Package = (Monthly basic
component x 120 months) = Rs. 27,330 x 120
= Rs. 32,79,600/
14
5. We have perused the pleadings and Written
Submissions made by the parties.
5.1 It is the admitted position that the Bank had
offered four alternative positions such as
“Business Development Officer”, “Customs
Service Officer”, which were at par with her
existing pay scale and emoluments. The
Appellant was however not willing to accept any
of the alternate positions offered to her. Nor
was she willing to accept the redundancy
package offered to her. In the circumstances
the R2Bank was justified in terminating the
services of the Appellant, vide termination letter
dated 01.10.2005.
5.2 The Bank has complied with the statutory
requirements under S. 25F of the I.D. Act
which lays down the conditions that an
employer must comply, on the retrenchment of
a workman.
In the present case, the High Court has held
that the Appellant had “abandoned” her job, on
15
her refusal to accept any of the alternative
positions with the bank, on the same pay scale.
5.3 The concept of “abandonment” has been
discussed at length in a Judgment delivered by
a 3Judge Bench of the Supreme Court in The
Buckingham & Carnatic Co. Ltd. v Venkatiah &
Ors.1 wherein it was held that abandonment of
service can be inferred from the existing facts
and circumstances which prove that the
employee intended to abandon service. This
case was followed by a two judge bench in
Vijay S Sathaye v Indian Airlines Ltd. & Ors.2
.
In the case before us, the intentions of the
Appellant can be inferred from her refusal to
accept any of the 4 alternative positions offered
by the R2Bank. It is an admitted position that
the alternative positions were on the same pay
scale, and did not involve any special training
or technical knowhow.
In any event, the claims raised by the
Appellant before various forums were with
1
(1964) 4 SCR 265
2
(2013) 10 SCC 253
16
respect to enhancement of compensation,
which are monetary in nature. The Appellant’s
conduct would constitute a voluntary
abandonment of service, since the Appellant
herself had declined to accept the various offers
of service in the Bank. Furthermore, even
during conciliation proceedings she has only
asked for an enhanced severance package, and
not reinstatement.
Once it is established that the Appellant had
voluntarily abandoned her service, she could
not have been in “continuous service” as
defined under S. 2(oo) the I.D. Act, 1947.
S. 25F of the I.D. Act, 1947 lays down the
conditions that are required to be fulfilled by an
employer, while terminating the services of an
employee, who has been in “continuous service”
of the employer. Hence, S. 25F of the I.D. Act,
would cease to apply on her.
The condition precedent for Retrenchment of
an employee, as provided in S. 25F of the I.D.
Act, 1947 was discussed by a Constitution
17
Bench of this Court in Hathisingh
Manufacturing Ltd. v Union of India3
, while
deciding the constitutional validity of S. 25FFF.
The Constitution Bench held,
“9. …Under Section 25F, no
workman employed in an
industrial undertaking can be
retrenched by the employer
until (a) the workman has been
given one month’s notice in
writing indicating the reasons
for retrenchment and the
period has expired or the
workman has been paid salary
in lieu of such notice, (b) the
workman has been paid
retrenchment compensation
equivalent to 15 days’ average
salary for every completed year
of service and (c) notice in the
prescribed manner is served on
the appropriate
Government….By S. 25F a
prohibition against
retrenchment, until the
conditions prescribed by that
Section are fulfilled in
imposed.”
S. 25F of the I.D. Act, 1947 is extracted herein
below:
“25F. Conditions precedent to
retrenchment of workmen. No
3 AIR 1960 SC 923
18
workman employed in any
industry who has been in
continuous service for not less
than one year under an
employer shall be retrenched by
that employer until—
(a) The workman has been given
one month's notice in writing
indicating the reasons for
retrenchment and the period of
notice has expired, or the
workman has been paid in lieu
of such notice, wages for the
period of the notice;
(b) the workman has been paid,
at the time of retrenchment,
compensation which shall be
equivalent to fifteen days'
average pay [for every completed
year of continuous service] or
any part thereof in excess of six
months; and
(c) notice in the prescribed
manner is served on the
appropriate Government [or such
authority as may be specified by
the appropriate Government by
notification in the Official
Gazette].”
In the present case, the R2Bank has paid the
Appellant a sum of Rs. 8,17,071/, which
included 6 months’ pay in lieu of Notice under
S. 25F(a) and an additional amount calculated
19
on the basis of 15 days’ salary multiplied by the
number of years of service, in compliance with
S. 25F(b).
However, no Notice was sent to the
Appropriate Government or authority notified,
in compliance with S. 25F(c) of the I.D. Act.
A three Judge Bench of this Court in Gurmail
Singh & Ors. v State of Punjab & Ors.4
Held that
the requirement of clause (c) of S. 25F can be
treated only as directory and not mandatory.
This was followed in Pramod Jha & ors. v State
of Bihar & Ors.5
wherein it was held that
compliance with S. 25F(c) is not mandatory.
5.4 The Appellant has admittedly received an
amount of Rs. 1,07,73,736/ under various
heads:
HEADS AMOUNT (IN RS.)
Towards Notice Period 1,77,684/
Severance Pay 6,39,387/
Gratuity 3,81,209/
Back Wages pursuant to
Execution
8,00,000/
4
(1991) 1 SCC 189
5
(2003) 4 SCC 619
20
Towards Interim Award 33,19,096/
Payments made under S.
17B.
54,56,360/
TOTAL 1,07,73,736/
The Appellant has claimed an amount of Rs.
69.99 lakhs. The Appellant has already
received almost double the amount claimed by
her.
6. In light of the discussions above, the aforesaid
amounts received by her may be treated as a final
settlement of all her claims. The impugned
Judgment of the Division Bench dated 14.07.2017,
is modified to this extent.
The Civil Appeals stand dismissed, with no
order as to costs. All applications stand disposed
of accordingly.
…………...........................J.
(ABHAY MANOHAR SAPRE)
.……………………J.
(INDU MALHOTRA)
New Delhi,
December 3rd 2018
21
22
of the employer. Hence, S. 25F of the I.D. Act, would cease to apply on her.- Apex court modified the order of High court and allowed to record full statisfaction of entire claim /package in full and final settlement .
“REPORTABLE”
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOs. 1176611767 OF 2018
(Arising out of SLP (Civil) Nos. 3020530206 of 2017)
Manju Saxena …Appellant
Versus
Union of India & Anr. …Respondent(s)
J U D G M E N T
INDU MALHOTRA, J.
Leave granted.
1. The present S.L.P.s arise out of the impugned
Judgment dated 14.07.2017 passed in L.P.A. No.
467/2017, and Order dated 13.09.2017 passed in
R.P. No. 380/2017 of the Delhi High Court,
wherein the High Court dismissed the L.P.A filed by
1
the Appellant against the 2nd Respondent HSBC
Bank.
2. Briefly stated, the factual matrix in which the
present S.L.P. has been filed are summarized as
under:
2.1 The Appellant was appointed on 01.04.1986 as
a “Lady Confidential Secretary” by the 2nd
Respondent HSBC Bank, (hereinafter referred
to as “the R2Bank”).
Subsequently, on 23.04.1992 the Appellant
came to be promoted as a “Senior Confidential
Secretary” to the Senior Manager (North India)
of HSBC.
2.2 In May 2005, the post of “Senior Confidential
Secretary” became redundant, as the Officer
with whom the Appellant was attached, left the
services of the R2Bank. Her services were
utilized by giving her some other duties for the
time being, till alternate jobs could be offered to
her.
The Management admittedly offered her four
alternate jobs of (i) Business Development
2
Officer, (ii) Customer Service Officer, (iii)
Clearing Officer, and (iv) Banking Services
Officer. Each of these jobs were in the same pay
scale.
The Appellant has admitted in her Statement
of Claim dated 20.03.2006, that she declined to
accept any of these jobs on the ground that
such jobs were either temporary in nature, or
the claimant did not possess the experience or
workknowledge to take up such jobs.
2.3 On 01.10.2005, the Bank issued a Letter
terminating the services of the Appellant on the
ground that her current job had become
redundant. The Appellant was offered several
job opportunities, however, she did not choose
any of these offers. The Bank had offered a
generous severance package, which she was
not prepared to accept. The Bank terminated
her service, and paid 6 months’ compensation
in lieu of Notice as per the contract of
employment. In addition, as a special case, the
Bank paid Compensation, which was
3
equivalent to 15 days’ salary for every
completed year of service. The total amount
paid to the Appellant was Rs. 8,17,071/.
2.4 The Appellant raised an Industrial Dispute
before the Regional Labour Commissioner
under the Industrial Disputes Act, 1947
(hereinafter referred to as the I.D. Act) on
03.10.2005, and sought enhancement of the
severance package paid to her. It is relevant to
note that the Appellant did not raise any claim
for reinstatement to the R2Bank.
Conciliation proceedings were commenced
between the Appellant and R2Bank, wherein
the Appellant made the following claims:
HEADS AMOUNT (INR)
Severance 69,99,600.00
Provident Fund 8,90,111.60
Gratuity 3,81,209.00
Leave Encashment 86,541.40
Compensation + Notice Pay 8,17,071.00
TOTAL 91,74,533.00
4
The Bank, in response, offered the following
package:
HEADS AMOUNT (INR)
Severance 32,79,600.00
Provident Fund 8,90,111.60
Gratuity 3,81,209.00
Leave Encashment 86,541.40
Compensation + Notice Pay 8,17,071.00
TOTAL 57,29,533.00
The only difference between the two parties
was with respect to the amount of Severance
payable to the Appellant. Since the parties were
unable to arrive at a settlement, the
conciliation proceedings failed.
2.5 The Appellant filed her Statement of Claim
dated 20.03.2006, before the Central
Government Industrial Tribunal (referred to as
“the CGIT”) claiming inter alia an enhanced
severance package, waiver of outstanding
Housing Loan, and full pension. The Claim was
opposed by the R2Bank. The R2Bank filed its
5
Written Statement and contested the claim of
the Appellant, stating that the Appellant was
not a “workman” under the I.D. Act, 1947. The
Bank further stated that they had followed the
procedure outlined under the I.D. Act, while
terminating the services of the Appellant.
The Ld. CGIT passed an Award dated
01.06.2009, and directed the R2Bank to reinstate
the Appellant, with full terminal
benefits.
2.6 The R2Bank filed Writ Petition bearing No.
W.P. (C) 11344/2009 before the Delhi High
Court, to challenge the Award passed by the
CGIT. The High Court vide Interim Order dated
22.03.2013 remanded the matter to the CGIT
for fresh consideration on the point whether the
Appellant could be considered to be a
“Workman” as per the Industrial Disputes Act,
1947. The Writ Petition was kept pending
during the pendency of the remand. The CGIT
passed a fresh Award dated 15.07.2015 holding
6
the Appellant to be a “workman” under the I.D.
Act, 1947.
The Ld. CGIT directed the R2Bank to reinstate
the Appellant with continuity of service,
full back wages, and all consequential benefits.
2.7 During the pendency of the Writ Petition, the
Appellant had filed an Application under S. 17B
of the I.D. Act, 1947 before the Delhi High
Court seeking interim maintenance. The High
Court vide Interim Order dated 27.07.2012
directed payment of a monthly sum of Rs.
75,000/ to the Appellant, towards Interim
Maintenance u/S. 17B of the I.D. Act, 1947.
2.8 Aggrieved by the Order dated 27.07.2012, the
R2 Bank filed an L.P.A. before the Delhi High
Court to challenge the amount awarded to the
Appellant u/S. 17B. The Division Bench vide
Order dated 24.08.2012, reduced the monthly
sum payable to Rs. 58,330/ per month which
was as per her last drawn salary.
7
The S.L.P. filed by the Appellant being S.L.P. (C)
No. 36513/2012 to challenge the Order dated
24.08.2012, came to be dismissed vide Order
dated 07.01.2013.
The Appellant accordingly has been paid back
wages u/S. 17B at Rs. 58,330/ per month.
2.9 The Appellant also raised a claim for waiver of
the outstanding amount of a Housing Loan
availed by her during the course of her service,
which was outstanding on the date of her
termination. The total amount of outstanding
loan was approximately Rs. 22,16,702/.
The Appellant challenged proceedings for
recovery initiated by the R2Bank before the
Delhi High Court in W.P. (C) No. 19451/2006.
A Consent Order dated 18.03.2010 came to be
passed whereby the outstanding amount of Rs.
22,16,702/ towards the Housing Loan, was to
be adjusted from her back wages, subject to the
final outcome of the W.P. (C) No. 13344/2009.
8
2.10 The Writ Petition filed by the R2Bank was
allowed by the learned Single Judge vide
Judgment and Order dated 12.04.2017, and
the Award passed by the CGIT came to be set
aside.
The High Court accepted the R2Bank’s
submissions, and held that the Appellant’s
refusal to accept any of the four alternate
positions offered to her, amounted to
“abandonment” of her job. Hence there was no
question of her services having been illegally
terminated. The Appellant had received
monetary compensation under several heads,
to the tune of Rs. 1,07,73,736/ during the
pendency of the Writ Petition, which was
almost 13 times her legal entitlement. This
included payments made under the various
heads such as Compensation paid during
termination, Gratuity, Payment towards Interim
Award, Payments under S. 17B, Payment
towards legal expenses. The Appellant was
9
directed to refund the entire amount except the
sum of Rs. 8,17,071/, which was the
compensation paid at the time of termination.
2.11 Aggrieved by the Judgment & Order dated
12.04.2017 in W.P. (C) 11334/2018, the
Appellant filed L.P.A. No. 467/2017 before the
Division Bench. The Division Bench vide
Judgment & Order dated 14.07.2017 dismissed
the L.P.A., and upheld the Judgment of the
learned Single Judge holding that the Appellant
had abandoned her job.
The Division Bench however modified the
operative direction passed by the Ld. Single
Judge for restitution of the amounts paid. The
Division Bench ordered that the Appellant shall
not be required to restitute the amount of Rs.
8,17,071/ paid at the time of termination, the
litigation expenses, and the amounts paid
under S. 17B of the I.D. Act, 1947.
10
2.12 The Appellant filed Review Petition No.
380/2017 which was dismissed vide Order
dated 13.09.2017.
2.13 The Appellant has assailed the Judgment
dated 14.07.2017 and Order dated 13.09.2017
passed by the Division Bench in the L.P.A. and
the Review Petition, by the present S.L.P.s.
3. The Appellant was appearing in Person. Even
though the Court had made a suggestion that a
Counsel be appointed to represent her, she
declined the same. The submissions made by the
Appellants are:
3.1 The Appellant submitted that she is entitled to
a Severance Package of Rs. 69.99 lakhs, which
is equivalent to her last drawn salary of Rs.
58,330/ per month for a period of 10 years,
i.e. 120 months.
The calculations put forth by the Appellant is
as follows:
11
[Severance Package = Last drawn monthly
Salary x 120 months];
[Rs. (58,330 x 120) = Rs. 69,99,600/]
3.2 The Appellant submitted that she had been in
“continuous service” for over 20 years with the
R2bank. Consequently, she was eligible for all
benefits payable to a ‘workman’ under the I.D.
Act.
3.3 The Appellant further submitted that the terms
of the Housing Loan taken by her during the
course of service, provided for 782certain
relaxations and benefits to the employees. The
Appellant submitted that her outstanding loan
amount should be waived by the R2Bank.
3.4 The Appellant submitted that the R2bank had
been deducting T.D.S. on all the payments
made to her during the pendency of the legal
proceedings. The Appellant submits that this
deduction is illegal, and she is entitled to a
refund of a sum of Rs. 13,69,083/ deducted
towards T.D.S.
12
4. The R2Bank was represented by Mr. Dhruv Mehta,
Sr. Adv, alongwith Mr. Gagan Gupta, Adv, the
Counsel for the R2bank inter alia submitted:
4.1 It is the admitted position that the Appellant’s
post had become redundant when her boss left
the Bank. The Appellant was offered four
alternate positions of (i) Business Development
Officer, (ii) Customer Service Officer, (iii)
Clearing Officer, and (iv) Banking Services
Officer in the same pay scale. The Appellant
however declined each of these offers. In these
circumstances, her services came to be
terminated. As a special case, a severance
amount of Rs. 8,17,071/ was paid apart from
the other benefits.
4.2 It was further submitted that the Bank
complied with all the mandatory requirements
specified in S. 25F (a) and (b) of the I.D. Act.
The compensation of Rs. 8,17,071/ granted to
the Appellant, was computed in accordance
with S. 25F (b) i.e. compensation equivalent to
13
15 days’ salary multiplied by the number of
years of employment.
The High Court had recorded that the
Appellant had already received monetary
benefits in excess of the compensation she was
entitled to under the law. Therefore, the
Appellant was not entitled to any additional
amount.
4.3 The R2Bank submitted that during
Conciliation proceedings, they had offered a
Severance Package of Rs. 32.79 lacs which was
worked out on the basis of the last drawn Basic
Salary + Monthly Allowances, for past 10 years
(equal to 120 months). The Basic Salary was
Rs. 19,280/ and Monthly Allowances [H.R.A. +
Medical + L.T.A. of Rs. 8,050/]. The total basic
component was Rs. 27,330/ (19,280 + 8,050).
The severance package by the Bank was
computed as follows:
Severance Package = (Monthly basic
component x 120 months) = Rs. 27,330 x 120
= Rs. 32,79,600/
14
5. We have perused the pleadings and Written
Submissions made by the parties.
5.1 It is the admitted position that the Bank had
offered four alternative positions such as
“Business Development Officer”, “Customs
Service Officer”, which were at par with her
existing pay scale and emoluments. The
Appellant was however not willing to accept any
of the alternate positions offered to her. Nor
was she willing to accept the redundancy
package offered to her. In the circumstances
the R2Bank was justified in terminating the
services of the Appellant, vide termination letter
dated 01.10.2005.
5.2 The Bank has complied with the statutory
requirements under S. 25F of the I.D. Act
which lays down the conditions that an
employer must comply, on the retrenchment of
a workman.
In the present case, the High Court has held
that the Appellant had “abandoned” her job, on
15
her refusal to accept any of the alternative
positions with the bank, on the same pay scale.
5.3 The concept of “abandonment” has been
discussed at length in a Judgment delivered by
a 3Judge Bench of the Supreme Court in The
Buckingham & Carnatic Co. Ltd. v Venkatiah &
Ors.1 wherein it was held that abandonment of
service can be inferred from the existing facts
and circumstances which prove that the
employee intended to abandon service. This
case was followed by a two judge bench in
Vijay S Sathaye v Indian Airlines Ltd. & Ors.2
.
In the case before us, the intentions of the
Appellant can be inferred from her refusal to
accept any of the 4 alternative positions offered
by the R2Bank. It is an admitted position that
the alternative positions were on the same pay
scale, and did not involve any special training
or technical knowhow.
In any event, the claims raised by the
Appellant before various forums were with
1
(1964) 4 SCR 265
2
(2013) 10 SCC 253
16
respect to enhancement of compensation,
which are monetary in nature. The Appellant’s
conduct would constitute a voluntary
abandonment of service, since the Appellant
herself had declined to accept the various offers
of service in the Bank. Furthermore, even
during conciliation proceedings she has only
asked for an enhanced severance package, and
not reinstatement.
Once it is established that the Appellant had
voluntarily abandoned her service, she could
not have been in “continuous service” as
defined under S. 2(oo) the I.D. Act, 1947.
S. 25F of the I.D. Act, 1947 lays down the
conditions that are required to be fulfilled by an
employer, while terminating the services of an
employee, who has been in “continuous service”
of the employer. Hence, S. 25F of the I.D. Act,
would cease to apply on her.
The condition precedent for Retrenchment of
an employee, as provided in S. 25F of the I.D.
Act, 1947 was discussed by a Constitution
17
Bench of this Court in Hathisingh
Manufacturing Ltd. v Union of India3
, while
deciding the constitutional validity of S. 25FFF.
The Constitution Bench held,
“9. …Under Section 25F, no
workman employed in an
industrial undertaking can be
retrenched by the employer
until (a) the workman has been
given one month’s notice in
writing indicating the reasons
for retrenchment and the
period has expired or the
workman has been paid salary
in lieu of such notice, (b) the
workman has been paid
retrenchment compensation
equivalent to 15 days’ average
salary for every completed year
of service and (c) notice in the
prescribed manner is served on
the appropriate
Government….By S. 25F a
prohibition against
retrenchment, until the
conditions prescribed by that
Section are fulfilled in
imposed.”
S. 25F of the I.D. Act, 1947 is extracted herein
below:
“25F. Conditions precedent to
retrenchment of workmen. No
3 AIR 1960 SC 923
18
workman employed in any
industry who has been in
continuous service for not less
than one year under an
employer shall be retrenched by
that employer until—
(a) The workman has been given
one month's notice in writing
indicating the reasons for
retrenchment and the period of
notice has expired, or the
workman has been paid in lieu
of such notice, wages for the
period of the notice;
(b) the workman has been paid,
at the time of retrenchment,
compensation which shall be
equivalent to fifteen days'
average pay [for every completed
year of continuous service] or
any part thereof in excess of six
months; and
(c) notice in the prescribed
manner is served on the
appropriate Government [or such
authority as may be specified by
the appropriate Government by
notification in the Official
Gazette].”
In the present case, the R2Bank has paid the
Appellant a sum of Rs. 8,17,071/, which
included 6 months’ pay in lieu of Notice under
S. 25F(a) and an additional amount calculated
19
on the basis of 15 days’ salary multiplied by the
number of years of service, in compliance with
S. 25F(b).
However, no Notice was sent to the
Appropriate Government or authority notified,
in compliance with S. 25F(c) of the I.D. Act.
A three Judge Bench of this Court in Gurmail
Singh & Ors. v State of Punjab & Ors.4
Held that
the requirement of clause (c) of S. 25F can be
treated only as directory and not mandatory.
This was followed in Pramod Jha & ors. v State
of Bihar & Ors.5
wherein it was held that
compliance with S. 25F(c) is not mandatory.
5.4 The Appellant has admittedly received an
amount of Rs. 1,07,73,736/ under various
heads:
HEADS AMOUNT (IN RS.)
Towards Notice Period 1,77,684/
Severance Pay 6,39,387/
Gratuity 3,81,209/
Back Wages pursuant to
Execution
8,00,000/
4
(1991) 1 SCC 189
5
(2003) 4 SCC 619
20
Towards Interim Award 33,19,096/
Payments made under S.
17B.
54,56,360/
TOTAL 1,07,73,736/
The Appellant has claimed an amount of Rs.
69.99 lakhs. The Appellant has already
received almost double the amount claimed by
her.
6. In light of the discussions above, the aforesaid
amounts received by her may be treated as a final
settlement of all her claims. The impugned
Judgment of the Division Bench dated 14.07.2017,
is modified to this extent.
The Civil Appeals stand dismissed, with no
order as to costs. All applications stand disposed
of accordingly.
…………...........................J.
(ABHAY MANOHAR SAPRE)
.……………………J.
(INDU MALHOTRA)
New Delhi,
December 3rd 2018
21
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