BHAVNAGAR MUN.CORP.ETC. Vs JADEJA GOVUBHA CHHANUBHA
Bench: T.S. THAKUR,R. BANUMATHI
Case number: C.A. No.-010690-010691 / 2014
Diary number: 30194 / 2012
Advocates: JATIN ZAVERI Vs
HARESH RAICHURA
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REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 10690-10691 OF 2014 (Arising out of S.L.P. (C) Nos. 36800-36801 of 2012)
Bhavnagar Municipal Corporation etc. …Appellants
Vs.
Jadeja Govubha Chhanubha & Anr. …Respondents
J U D G M E N T
T.S. THAKUR, J.
1. Leave granted.
2. These appeals arise out of a judgement and order
dated 20th July, 2012 passed by the High Court of Gujarat at
Ahmedabad whereby Letters Patent Appeal No.878 of 2012
filed by the appellant-Corporation has been dismissed and
the order passed by the learned Single Judge of that Court
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partly modifying the award made in favour of the respondent
affirmed.
3. The respondent, it appears, was employed as a
Conductor in the Transport Department of the appellant-
Corporation on daily-wage basis in October, 1987. He claims
to have served in that capacity till 31st March, 1989 when his
services were terminated. Aggrieved by the termination, the
respondent raised an industrial dispute before the Assistant
Labour Commissioner, Bhavnagar who tried to resolve the
same by way of conciliation but since the conciliation
proceedings also failed, Reference No.459 of 1990 was made
to the Labour Commissioner at Bhavnagar for adjudication of
the dispute between the parties. The Labour Court allowed
the parties to adduce evidence in support of their respective
versions and eventually came to the conclusion that the
respondent had indeed worked as a Conductor with the
appellant-Corporation between 3rd October, 1987 and 31st
March, 1989. The Labour Court in the process rejected the
appellant's case that the respondent had worked only for 58
days as Badli Conductor and was not, therefore, entitled to
protection of Section 25F of the Industrial Disputes Act,
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1947. The Labour Court placed reliance upon a Xerox copy of
a certificate allegedly issued by an officer of the appellant-
Corporation certifying that the respondent had worked as a
Conductor for the period mentioned above. The Labour Court
drew an adverse inference against the appellant-Corporation
for its omission to produce relevant record to prove that the
respondent-workman had worked only for 58 days hence not
entitled to the benefit of any retrenchment compensation.
The Labour Court on that basis held the termination of
the respondent from service to be illegal and directed
reinstatement with 65% back wages.
4. Aggrieved by the award made by the Labour Court the
appellant-Corporation filed Special Civil Application
No.11508 of 2002 which was heard and partly allowed by a
learned Single Judge of the High Court of Gujarat at
Ahmedabad by his order dated 24th April, 2012. The High
Court referred to the evidence adduced by the parties before
the Labour Court and came to the conclusion that the
appellant-Corporation had not been able to prove its
assertion that the respondent had worked for 58 days only.
The High Court held that the findings recorded by the Labour
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Court to the effect that the respondent had worked between
3rd October, 1987 and 31st March, 1989 were supported by
sufficient evidence and material on record. Having said so,
the High Court opined that the award of back wages of 65%
was not justified as the Labour Court had not given any
cogent reasons while directing such back wages nor had the
Labour Court examined whether the respondent was
gainfully employed during the intervening period. The award
to the extent it directed payment of 65% back wages was,
therefore, held to be perverse by the learned Single Judge of
the High Court which part was accordingly set aside and the
writ petition partly allowed.
5. Dissatisfied with the order passed by the Single Judge
the appellant-Corporation filed Letters Patent Appeal No.878
of 2012 which, as noticed earlier, was dismissed by a
Division Bench of the High Court by its order dated 20th July,
2012. The Division Bench was of the view that the findings
recorded by the Labour Court did not suffer from any
infirmity to call for any interference specially when the other
employees of the appellant-Corporation appear to have been
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absorbed by the Corporation upon closure of its Transport
Department.
6. On behalf of the appellant-Corporation it was argued
that the findings recorded by the Labour Court to the effect
that the respondent had worked as a Conductor between 3rd
October, 1987 and 31st March, 1989 was not supported by
any evidence and was, therefore, perverse. It was contended
that the solitary piece of evidence which the respondent had
produced in support of his version was a Xerox copy of a
certificate allegedly issued by an officer of the appellant-
Corporation who was never summoned as a witness. Apart
from the said document and the self-statement of the
respondent there was no other material to support the
findings that the respondent had indeed worked for 240 days
as alleged by him before his termination. On the contrary, it
was proved by the documents placed on record by the
appellant that the respondent was a Conductor who had
worked for just about 58 days hence was not entitled to any
protection under Section 25F of the Industrial Disputes Act,
1947. It was urged that the Labour Court had wrongly drawn
an adverse inference against the appellant-Corporation,
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overlooking the settled legal position that the burden of
proof lay on the workman to establish that he was in
continuous employment for a period of 240 days to be
entitled to question the termination of his employment
without retrenchment compensation. The Single Judge of the
High Court and so also the Division Bench failed to
appreciate the essence of the controversy and fell in error in
upholding the award made by the Labour Court.
7. On behalf of the respondent, it was contended that the
findings recorded by the Labour Court do not suffer from any
perversity to call for our interference. The Single Judge,
according to the learned counsel, has examined the
evidence on record and clearly held that there was sufficient
material to support the findings that the respondent had
worked for more than 240 days and was, therefore, entitled
to the protection of Section 25-F and that since no
retrenchment compensation had been paid at the time of
the termination of his employment, the order of termination
was illegal which entitled the respondent to reinstatement. It
was also contended that although sufficient number of years
had rolled back since the respondent last served with the
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appellant-Corporation, yet the respondent was entitled to be
reinstated no matter the Transport Department of the
appellant-Corporation where the respondent was working
had been wound up. The fact that the similarly situated
workmen in the department had been adjusted, according to
the learned counsel, was a sufficient reason for the
respondent to seek reinstatement with or without back
wages.
8. It is fairly well-settled that for an order of termination of
the services of a workman to be held illegal on account of
non-payment of retrenchment compensation, it is essential
for the workman to establish that he was in continuous
service of the employer within the meaning of Section 25B of
the Industrial Disputes Act, 1947. For the respondent to
succeed in that attempt he was required to show that he was
in service for 240 days in terms of Section 25B(2)(a)(ii). The
burden to prove that he was in actual and continuous service
of the employer for the said period lay squarely on the
workman. The decisions of this Court in Range Forest
Officer v. S.T. Hadimani (2002) 3 SCC 25, Municipal
Corporation, Faridabad v. Siri Niwas (2004) 8 SCC
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195, M.P. Electricity Board v. Hariram (2004) 8 SCC
246, Rajasthan State Ganganagar S. Mills Ltd. v. State
of Rajasthan & Anr. (2004) 8 SCC 161, Surendra Nagar
District Panchayat and Anr. v. Jethabhai Pitamberbhai
(2005) 8 SCC 450, R.M. Yellatti v. Assistant Executive
Engineer (2006) 1 SCC 106 unequivocally recognise the
principle that the burden to prove that the workman had
worked for 240 days is entirely upon him. So also the
question whether an adverse inference could be drawn
against the employer in case he did not produce the best
evidence available with it, has been the subject-matter of
pronouncements of this Court in Municipal Corporation,
Faridabad v. Siri Niwas (supra) and M.P. Electricity
Board v. Hariram (supra), reiterated in Manager,
Reserve Bank of India, Bangalore v. S. Mani (2005) 5
SCC 100. This Court has held that only because some
documents have not been produced by the management, an
adverse inference cannot be drawn against it.
9. The Labour Court has, in the case at hand, placed
reliance upon a Xerox copy of a certificate allegedly issued
by an officer of the appellant-Corporation stating that the
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respondent was in the employment of the appellant-
Corporation as a Conductor between 3rd October, 1987 and
31st March, 1989. While it is true that the Xerox copy may
not be evidence by itself specially when the respondent had
stated that the original was with him, but had chosen not to
produce the same yet the fact remains that the document
was allowed to be marked at the trial and signature of the
officer issuing the certificate by another officer who was
examined by the appellant. Strict rules of evidence, it is
fairly well-settled, are not applicable to the proceedings
before the Labour Court. That being so the admission of the
Xerox copy of the certificate, without any objection from the
appellant-Corporation, cannot be faulted at this belated
stage. When seen in the light of the assertion of the
respondent, the certificate in question clearly supported the
respondent's case that he was in the employment of the
appellant-Corporation for the period mentioned above and
had completed 240 days of continuous service. That being
so, non-payment of retrenchment compensation was
sufficient to render the termination illegal. Inasmuch as the
Labour Court declared that to be so it committed no mistake
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nor was there any room for the High Court to interfere with
the said finding especially when the findings could not be
described as perverse or without any evidence. The High
Court was also justified in directing deletion of the back
wages from the award made by the Labour Court against
which deletion, the respondent did not agitate either before
the Division Bench by filing an appeal or before us.
10. The only question that remains to be examined in the
above backdrop is whether reinstatement of the respondent
as a Conductor is imperative at this late stage. We say so
because the appellant claims to have worked for a period of
just about 18 months that too nearly three decades ago. The
respondent today may be past fifty if not more. The
Transport Department where he was working appears to
have been wound up and transport work out sourced. That
apart, this Court has in a series of decisions held that the
illegality in an order of termination on account of non-
payment of retrenchment compensation does not
necessarily result in the reinstatement of the workman in
service. This Court has, in cases where such termination is
found to be illegal, directed compensation in lieu of
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reinstatement. We may at this stage refer to some of those
decisions:
11. In Mahboob Deepak v. Nagar Panchayat Gajraula
and Anr. (2008) 1 SCC 575, this Court held that since the
appellant had worked only for a short period, interest of
justice would be sub-served if the direction for reinstatement
was modified and compensatory payment of Rs.50,000/- in
lieu thereof directed to be substituted. Similarly in Sita
Ram and Ors. v. Moti Lal Nehru Farmers Training
Institute (2008) 5 SCC 75, this Court took into
consideration the period during which the services were
rendered by the workman and instead of reinstatement
directed a lump sum payment of Rs.1,00,000/- in lieu
thereof.
12. In Ghaziabad Development Authority and Anr. v.
Ashok Kumar and Anr. (2008) 4 SCC 261, this Court
made a similar order as is evident from the following
passage:
“10. We are, therefore, of the opinion that the appellant should be directed to pay compensation to the first respondent instead and in place of the relief of reinstatement in service. Keeping in view the fact that the respondent worked for about six years as
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also the amount of daily wages which he had been getting, we are of the opinion that the interest of justice would be subserved if the appellant is directed to pay a sum of Rs. 50,000/- to the first respondent.”
[emphasis supplied]
13. To the same effect is decision of this Court in Jagbir
Singh v. Haryana State Agriculture Marketing Board
and Anr. (2009) 15 SCC 327 where this Court held that
while awarding compensation in lieu of reinstatement host of
factors should be kept in mind. The Court said:
16. While awarding compensation, the host of factors, inter-alia, manner and method of appointment, nature of employment and length of service are relevant. Of course, each case will depend upon its own facts and circumstances. In a case such as this where the total length of service rendered by the appellant was short and intermittent from September 1, 1995 to July 18, 1996 and that he was engaged as a daily wager, in our considered view, a compensation of Rs.50,000/- to the Appellant by Respondent No. 1 shall meet the ends of justice.”
[emphasis supplied]
14. Reference may also be made to the decision of this
Court in Senior Superintendent Telegraph (Traffic)
Bhopal v. Santosh Kumar Seal and Ors. (2010) 6 SCC
773, where this Court referred to the previous decisions on 12
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the subject to declare that even when a retrenchment order
passed in violation of Section 25(F) may be set aside,
reinstatement need not necessarily follow as a matter of
Court. The following passage from the decision is apposite:
14. It would be, thus, seen that by a catena of decisions in recent time, this Court has clearly laid down that an order of retrenchment passed in violation of Section 25F although may be set aside but an award of reinstatement should not, however, be automatically passed. The award of reinstatement with full back wages in a case where the workman has completed 240 days of work in a year preceding the date of termination, particularly, daily wagers has not been found to be proper by this Court and instead compensation has been awarded. This Court has distinguished between a daily wager who does not hold a post and a permanent employee.”
[emphasis supplied]
15. To the same effect is the decision of this Court in
Incharge Officer and Anr. V. Shankar Shetty (2010) 9
SCC 126, where this Court said:
“5. We think that if the principles stated in Jagbir Singh and the decisions of this Court referred to therein are kept in mind, it will be found that the High Court erred in granting relief of reinstatement to the respondent. The respondent was engaged as daily wager in 1978 and his engagement continued for about 7 years intermittently upto September 6, 1985 i.e. about 25years back. In a case such as the present one, it appears to us that relief of reinstatement cannot be justified and instead monetary compensation would meet the ends of justice. In our considered opinion, the compensation
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of Rs. 1,00,000/- (Rupees One lac) in lieu of reinstatement shall be appropriate, just and equitable.”
[emphasis supplied]
16. The case at hand, in our opinion, is one such case
where reinstatement must give way to award of
compensation. We say so because looking to the totality of
the circumstances, the reinstatement of the respondent in
service does not appear to be an acceptable option.
Monetary compensation, keeping in view the length of
service rendered by the respondent, the wages that he was
receiving during that period which according to the evidence
was around Rs.24.75 per day should sufficiently meet the
ends of justice. Keeping in view all the facts and
circumstances, we are of the view that award of a sum of
Rs.2,50,000/- (Rupees Two Lacs Fifty Thousand only) should
meet the ends of justice.
17. In the result, we allow these appeals but only in part
and to the extent that the award made by the Labour Court
and the orders of the High Court shall stand modified to the
extent that the respondent shall be paid monetary
compensation of Rs.2,50,000/- (Rupees Two Lacs Fifty
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Thousand only) in full and final settlement of his claim. The
amount shall be paid by the appellant-Corporation within a
period of two months from today failing which the said
amount shall start earning interest @ 12% p.a. from the date
of this order till actual payment of the amount is made to the
respondent.
……………………………..…….…..…J. (T.S. THAKUR)
……………………………..…….…..…J. New Delhi; (R. BANUMATHI) December 3, 2014
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