1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.1014/2008 R. Lakshman : Petitioner v/s M/s. Manohar Brothers (Capacitors) : Respondent Mr. A.B. Desai advocate for petitioner Mr. R.V. Paranjpe advocate for respondent Coram : Smt. R.S. Dalvi, J. Date : 23.6.2008 P.C. 1. Rule returnable forthwith. The respondent have appeared and argued on merits. The respondents accordingly waive service. 2. The petitioner was a stenographer in a firm of the respondent. The petitioner was retrenched. He had to be paid retrenchment compensation u/s 25F of the Industrial Disputes Act. Section 25F shows the conditions precedent to retrenchment of workmen being inter alia : (1)one month's notice in writing for retrenchment and (2)Payment of retrenchment compensation being compensation equivalent to 15 days average pay for every completed year of continuous service. 3. In this case the notice of retrenchment is given. Retrenchment compensation is paid. The petitioner challenges the retrenchment on the ground that the entire compensation is not paid. Admittedly the retrenchment compensation is calculated only upon the petitioner's basic salary and without taking into account the HRA, 2 conveyance allowance, medical allowance and leave travel allowance. The compensation to be calculated must mandatorily include each of these allowances. The retrenchment compensation paid to petitioner has admittedly not included any of these. It is the contention on behalf of the respondent that the petitioner who was his stenographer had drafted the letter of retrenchment himself, computed the amount payable to himself, made out the cheque himself and got it signed by the respondents' director. Hence it is the contention of the respondents that the respondent are not liable for what is mentioned in the letter of retrenchment or for the amount of the retrenchment compensation. It is contended that the mistake, if any, has arisen at the end of the petitioner himself and it being a bonafide mistake, the respondent would, if directed, pay up the short fall. 4. It would have to be seen whether the computation of compensation was bonafide made. 5. The respondent's advocate has drawn my attention to the petitioner's averments in his statement of claim and the respondent's averments in the written statement filed in the Labour Court at Bombay with regard to this aspect and the evidence with regard thereto. 6. The petitioner had filed his examination in chief in the Labour Court in which there is no specific mention about the actual calculation made by any specific person in the amount of retrenchment compensation. There is no mention in the cross examination of the petitioner with regard to this aspect. The case of the respondents is 3 shown to have been put to the petitioner in his cross examination. 7. In the affidavit of examination in chief on behalf of the respondents these facts have been mentioned in para 1. In the cross examination of the witness on behalf of the respondents, being director of the respondents, it is admitted that the petitioner received retrenchment notice and compensation under protest. It is denied that the respondents have paid Rs. 5280/- less than amount of retrenchment compensation payable to the petitioner. The last drawn salary of the petitioner which was shown to be Rs. 4044/- p.m.was not the salary remembered by the witness. The witness stated that he had not disputed the difference in amount of retrenchment compensation before any appropriate authority or paid it to the petitioner. The shortfall in payment of retrenchment compensation was denied. Consequently the retrenchment compensation of the petitioner was denied to be illegal. 8. It is seen that admittedly the petitioner's basic salary is taken into account for computation of the retrenchment compensation. The very basis of the computation is therefore wholly incorrect. Retrenchment compensation paid on that basis is wholly illegal. The 2nd condition precedent in section 25F, is, therefore, not complied. The retrenchment is, therefore, liable to be set aside as illegal. 9. The petitioner's advocate drew my attention to the judgment of this court in the case of Vijendrasingh Ladusingh Shekhawat vs Todi Industries Ltd. & anr.2004 CLR 453 in which when house rent allowance was not taken into account without calculating retrenchment compensation it was held that the retrenchment itself was illegal for want of compliance with the mandatory requirement of section 25F. 4 10. This judgment considered the earlier judgment of this court in the case of Auro Engg. Pvt.Ltd. Vs R.A. Gadekar (1992 I LLJ 693) in which the purpose and object of this provision was laid down. That was a measure of amelioration intended to soften the blow of unemployment which would fall upon a workman deprived of his livelihood. It was held that section 25F imposed a mandatory duty on the employer as a condition precedent to retrenchment of workmen and hence in contravention of any of the conditions precedent would invalidate the retrenchment. 11. In the case of Bombay Film Laboratory ltd. Vs Vasule. L.G .& anr, (1998) ILLJ 208 Bom. the question of short payment arose. The rectification of short payment, considering the Balmer Lawrie case, was allowed. In that case it was observed that the letter of retrenchment gave a break up of retrenchment compensation and the period of service. The material defect therein was not urged by the employee. It was only when the employer filed the documents, that the employee realized the short payment. The employer made up the deficit by depositing that amount in the labour court immediately. It was therefore held that the mistake was bonafide. The employer had not acted malafide. There was no deliberate intention on his part to pay his employee the amount lesser than whatever he was entitled and the employer had already cured the deficiency. Consequently the amount of shortfall already made good by the employer was held not to taint the order of retrenchment. 12.The respondents have relied upon the judgment of the Calcutta High 5 court in the case of Purna Theater vs State of West Bengal and ors. (2000) ILLJ 519 Cal. That was the case of short payment of retrenchment not specifically pleaded by the workman which was held not to vitiate the order of retrenchment. In that case a short payment was itself noticed later. It was a genuine and bonafide mistake. It was allowed to be corrected. The earlier Supreme Court judgments in the case of Balmer Lawrie and Bombay Film Laboratory were considered. A bonafide mistake which was sought to be rectified at the earliest available opportunity was allowed to be corrected in computing the amount of retrenchment compensation resulting in short payment. This is not a case of such nature. In this case it is admitted that the petitioner has accepted the compensation under protest. Hence the respondents' case that the petitioner had himself drawn out his cheque and drafted his letter of retrenchment cannot be accepted. The shortfall, if any, has not also been sought to be paid to correct any bonafide mistake at the earliest available opportunity. The cross examination of the respondents' director shows that he denied the claim of the petitioner in the labour court. He did not deposit the amount of difference in retrenchment compensation. It was the case of the respondents that the retrenchment compensation paid was correct and that no further amount was payable and the retrenchment was valid and proper. Infact the shortness in the retrenchment compensation itself was denied. 13. The plea taken at the 11th hour to come out of the clutches of the mandatory requirement of law cannot be allowed as a bonafide error. The respondents tried their best to deny the petitioner's claim in the Labour court. The cross examination of the director is based on this fact. Thereafter in the writ petition only they have claimed that they are 6 prepared to pay the balance amount. They have not deposited the shortfall in the labour court. Allowing the respondent to pay the paltry amount of shortfall of Rs. 5280/- to allow the otherwise illegal retrenchment notice and the amount of retrenchment compensation to be rectified would be to do a lot of injustice to the employee petitioner who was entitled to be paid that amount since as far back as in January 2003. 14. The case made out by the respondent is a new defense in this writ petition. In view of the fact that the petitioner accepted the retrenchment notice and compensation under protest that case cannot be accepted. 15. It may be mentioned that even otherwise the respondents would themselves be required, as employers who retrenched their employees to determine the correct amount of compensation and to comply with all the conditions precedent u/s 25F of the Industrial Disputes Act. They cannot rely upon a stenographer to perform that function. It is not the function of a stenographer to compute retrenchment compensation for himself or for any other workman. The test in determining the liability, if any, of the employer for such computation would be to consider the case of another workman whose retrenchment compensation could have been similarly computed by the stenographer on behalf of and instead of the employer. The employer would be liable for the consequences of shortfall in the payment of retrenchment of such employee on the principle of “qui facie per alium facie per se”. The principle would be the same if the employee pays himself. 7 16. The shortfall in the retrenchment compensation is therefore not a mere arithmetical error which has bonafide arisen while computing that amount. It has not been offered to be paid at the earliest available opportunity. Such defense is now not available to the respondents in answer to the petitioner's contention that the retrenchment itself has been rendered void on that count. 17. It is seen that their computation has proceeded on a wrong basis. The retrenchment compensation is not paid as enjoined in section 25F of the Industrial Disputes Act. The retrenchment is therefore illegal and void. Consequently the writ petition deserves to be allowed. Rule is made absolute as prayed. The impugned order of the 2nd labour Court dt. 29.5.2007 is quashed and set aside. The retrenchment of the petitioner is declared illegal. The petitioner shall therefore have to be reinstated in service of respondent no.1 with continuity of service and full back wages with effect from the notice of retrenchment dt. 10.1.2003. Order accordingly. 18. This order is stayed for six weeks. (R.S. Dalvi, J)