Industrial Disputes Act, 1947 – ss.25F, 25B – Termination – Retrenchment– Violation of s.25F–Respondent-University regularized appellants-workmen serving on daily wage basis in nonteaching staff category – Objections raised w.r.t the manner of regularization– De-regularised and terminated – Order of deregularisation upheld by Division Bench of High Court, question of non-observance of the provisions of 1947 Act left open – Dispute raised by appellants – Industrial Tribunal held termination to be in violation of s.25F, award passed– Set aside by Single Judge – Order confirmed by Division Bench – On appeal, held: Nature of employment and the manner in which the workman has been employed is not significant while invoking the mandatory compliance of s.25F – In a case where the workman has been in continuous service for more than 240 days in the preceding 12 months before the alleged date of terminationas contemplated u/s.25B, the employer is under an obligation to comply with the twin conditions u/Clauses
(a) and (b) of s.25F– In the present case, the appellants served from the year 1993-1997, their services were terminated in sequel to order dtd.24.03.97– Appointments were made on daily wage basis under the orders of the Vice Chancellor, the competent/appointing authority– Merely because the appointments were not in accordance with the procedure prescribed under the Ordinance would not disentitle the appellants from claiming protection under provisions of the 1947 Act– Termination of the appellants was in violation of s.25F – Impugned judgment set aside– Award modified– Sree Sankaracharya University of Sanskrit Ordinance, 1993. Industrial Disputes Act, 1947 –ss.2(g), (j), (k), (s), (oo) – Held: Every termination for any reason whatsoever provided it does not fall in any of the exception clause of s.2(oo), is a retrenchment. Industrial Disputes Act, 1947 – Scheme of the Act – Discussed. Industrial Disputes Act, 1947– s.25F – Non-observance of mandatory requirement of – Appropriate relief workman is entitled for – Discussed.
Partly allowing the appeals, the Court
HELD: 1.1 The termination which was given effect to by the 1st respondent was a retrenchment as defined under Section 2(oo), Industrial Disputes Act, 1947. The term ‘retrenchment’ leaves no manner of doubt that the termination of the workman for any reason whatsoever, otherwise than as punishment inflicted by way of disciplinary action are being termed as retrenchment with certain exceptions and it is not dependent upon the nature of employment and the procedure pursuant to which the workman has entered into service. In continuation thereof, the condition precedent for retrenchment has been defined under Section 25F of the Act 1947 which postulates that workman employed in any industry who has been in continuous service for not less than one year can be retrenched by the employer after clauses (a) and
(b) of Section 25F have been complied with and both the clauses
(a) and (b) of Section 25F have been held by this Court to be mandatory and its non-observance is held to be void ab initio bad and what is being the continuous service has been defined under Section 25B of the Act 1947. The scheme of the Act 1947 contemplates that the workman employed even as a daily wager or in any capacity, if has worked for more than 240 days in the preceding 12 months from the alleged date of termination and if the employer wants to terminate the services of such a workman, his services could be terminated after due compliance of the twin clauses (a) and (b) of Section 25F of the Act 1947 and to its non-observance held the termination to be void ab initio bad. [Para 20, 22 and 23][307-F-G; 308-E-G; 310-C-D]
1.2 The salient fact which has to be considered is whether the employee who has been retrenched is a workman under Section 2(s) and is employed in an industry defined under Section 2(j) and who has been in continuous service for more than one year can be retrenched provided the employer complies with the twin conditions provided under clauses (a) and (b) of Section 25F of the Act 1947 before the retrenchment is given effect to. The nature of employment and the manner in which the workman has been employed is not significant for consideration while invoking the mandatory compliance of Section 25F of the Act 1947. This can be noticed from the term ‘retrenchment’ as defined under Section 2(oo) which in unequivocal terms clearly postulates that termination of the service of a workman for any reason whatsoever provided it does not fall in any of the exception clause of Section 2(oo), every termination is a retrenchment and the employer is under an obligation to comply with the twin conditions of Section 25F of the Act 1947 before the retrenchment is given effect to. In every retrenchment, the employer is not under an obligation to comply with the twin conditions referred to under clauses (a) and (b) of Section 25F of the Act but in a case where the workman has been in continuous service for more than 240 days in the preceding 12 months before the alleged date of termination as contemplated under Section 25B, the employer is under an obligation to comply with the twin conditions referred to under clauses (a) and (b) of Section 25F of the Act 1947. Such nonobservance has been termed to be void ab initio bad and consequence in the ordinary course has to follow by reinstatement with consequential benefits but it is not held to be automatic and what alternative relief the workman is entitled for on account of non-observance of mandatory requirement of Section 25F of the Act 1947 is open to be considered by the Tribunal/Courts in the facts and circumstances of each case. In the instant case, the appellants had served as a daily wager in non-teaching staff category from the year 1993-1997 and their services were terminated in sequel to the order dated 24th March, 1997 pursuant to which their services were de-regularized. [Paras 24, 25, 30,
31 and 34][310-F-H; 311-A; 316-C-E; 318-B]
Punjab Land Development and Reclamation
Corporation Ltd., Chandigarh Vs. Presiding Officer, Labour Court, Chandigarh and Others 1990 (3) SCC
682 : [1990] 3 SCR 111– followed.
State Bank of India Vs. Shri N. Sundara Money 1976
(1) SCC 822 : [1976] 3 SCR 160; L. Robert D’Souza Vs. Executive Engineer, Southern Railway and Another 1982 (1) SCC 645 : [1982] 3 SCR 251; Bharat Sanchar Nigam Limited Vs. Bhurumal 2014 (7) SCC 177 : [2013]
(16) SCR 1023 – relied on.
1.3 What has been observed by the Division Bench in its Judgment in the earlier round of litigation may not have any relevance so far as the question which has been examined by the Tribunal in answering the reference in affirmative terms regarding non-observance of Section 25F of the Act 1947 and its consequential effect. Appointments are made in the instant case on daily wage basis under the orders of the Vice Chancellor who is the competent/appointing authority and merely because their appointments are not in accordance with the procedure prescribed under the Ordinance would not disentitle them from claiming protection under provisions of the Act 1947. [Paras 35, 37] [318-C-D, H; 319-A]
1.4 In the facts and circumstances of the instant cases and looking into the nature of service rendered by the appellants as daily wager for a short period, while upholding the termination of the appellants being in violation of Section 25F of the Act 1947, a lumpsum monetary compensation of Rs.2,50,000/- is awardedto each of the appellants-workmen in full and final satisfaction of the dispute in lieu of right to claim reinstatement with 50% back wages as awarded by the Tribunal. The impugned judgment of the High Court is set aside and the Award of the Industrial Tribunal is modified to the extent indicated. [Paras 42, 44] [319-H; 320-A-B, C]
R. Vishwanatha Pillai Vs. State of Kerala and Others 2004 (2) SCC 105 : [2004] (1) SCR 360; Rajasthan Tourism Development Corporation Ltd. And Another Vs. Intejam Ali Zafri 2006 (6) SCC 275 : [2006] (3) Suppl. SCR 533; Satluj Jal Vidyut Nigam Vs. Raj Kumar Rajinder Singh (Dead) through legal representatives and Others 2019 (14) SCC 449 : [2018] 12 SCR 282; Punjab Urban Planning and Development Authority and Another Vs. Karamjit Singh 2019 (16) SCC 782 : [2019] (5) SCR 864 – held inapplicable.
Nagar Mahapalika (Now Municipal Corpn.) Vs. State of U.P. and Others 2006 (5) SCC 127 : [2006] (1) Suppl. SCR 681; District Development Officer and Another v. Satish Kantilal Amralia 2018 (12) SCC 298 : [2017]
(12) SCR 414 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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