C.W.P. No.4451 of 2000 -1- IN THE HIGH COURT FOR THE STATES OF PUNJAB AND HARYANA AT CHANDIGARH C.W.P. No.4451 of 2000 (O&M) Date of Decision:07.10.2009 Punjab Ex-Servicemen Corporation .....Petitioner Versus Presiding Officer, Industrial Tribunal, Punjab and another ...Respondents Present: Mr. P.K. Mutneja, Advocate with Mr. S.S. Sudan, Advocate for the petitioner. Mr. Ravi Kant Sharma, Advocate for respondent No.2. CORAM:HON'BLE MR. JUSTICE K. KANNAN 1. Whether Reporters of local papers may be allowed to see the judgment ? Yes 2. To be referred to the Reporters or not ? Yes 3. Whether the judgment should be reported in the Digest?Yes -.- K. KANNAN J. 1. The order impugned in this writ petition is with reference to an award dated 26.10.1999 that disposed of complaints alleged to be inter-linked with case nos.74/2 of 1998, 74/3 of 1998 and 74/4 of 1998. The writ petition, however, is with reference to a workman, Sh. Prithipal Singh Sohal who raised a complaint stating that he had been unlawfully terminated from service, when he had been appointed as Sales Executive, without due compliance of statutory mandate of Section 25-F of Industrial Disputes Act. The defence was such that it has thrown up several fundamental issues of importance. Although the relationship of the petitioner with the management itself is not denied, the objections have been with reference to the fact that: one, he was not even an Ex-serviceman and even the entry into the C.W.P. No.4451 of 2000 -2- Corporation was illegal and consequently, the workman could not have no relief. Two, he was a Sales Executive and not a workman within the definition of the Industrial Disputes Act. Three, on a complaint by the workman that he was a protected workman and hence he could not have been terminated without following the procedure prescribed under Section 33(3) of the Industrial Disputes Act, the management also denied the workman's status as a protected workman. Four, the contention was that there had been no retrenchment to apply the mandate of Section 25-F of the Industrial Disputes Act. The contention on behalf management was that the workman had been employed under a stipulation as regards the period of employment and for a particular purpose of working as a Sales Executive in an automobile agency which the Corporation had undertaken. The agency itself was withdrawn and consequently, the employment had also come to an end. In other words, the termination of service resulted from the excepted situation provided under Section 2(oo) (bb) of the Industrial Disputes Act. 2. The Labour Court rejected all the contentions of the management and allowed the individual claims as well as the complaints lodged through the Labour Union. The above writ petition raises the dispute regarding the workman's alleged status as an Ex- serviceman and is a situation that does not apply to other case and therefore, both the parties desired an independent adjudication and expresses themselves as willing to argue without reference to the merits of the contentions in other cases dealt with by the Labour Court. This case is, therefore, delinked from the other cases and heard C.W.P. No.4451 of 2000 -3- for disposal independently. 3. Learned counsel appearing for the management contends that nature of appointment which was granted to the workman on 28.07.1994 clearly refers to the fact that it was for an independent unit which had no connection with other activities of the Corporation. The order of appointment spells out the name of Eicher Mistubishi marked specifically in one corner and that the appointment was specifically only for the work as a Sales Executive when the Corporation had taken the agency for sale of automobile vehicles and their spare parts. Learned counsel for the petitioner would expatiate the following factors as being relevant for consideration that spelt out a clear stipulation of a contract for a particular purpose only. The appointment itself had been offered as “Sales Executive in PESCO AUTO.” The clause 2 (iv) of the appointment letter refers to the entitlement to sale commission of Rs.1,000/- per vehicle provided he ensured a sale of 3 vehicles in one quarter. For Government sale he would be entitled to Rs.500/- per vehicle. The linkage of his salary to some incentives for the job as a Sales Executive, according to the learned counsel, would show that the appointment was specifically only for PESCO AUTO. Sub Clause (vi) provided that the appointment was on a contract basis for a period of one year and Sub Clause (viii) specified that the appointment was extendable on mutual agreeable terms. The learned counsel would also state that the Corporation was engaged in several activities such as providing watch and ward facilities to various industrial establishments, stitching army uniforms, auto workshop for Government and Army vehicles and the C.W.P. No.4451 of 2000 -4- work of sale of vehicles of Eicher (a renowned tractor company) and the spare parts were only some of several activities. All this was an attempt to show that the engagement of the workman had been specifically linked to the availability of work and the continuance of contract with Eicher Motors agency and the moment that agency was withdrawn, the workman had also lost his relevance and his services were required to be terminated. Having regard to the admitted fact that the agency stood terminated in August, 1998, the termination effected on 15th April in anticipation of the determination of agency could not be termed to be in violation of any of the provisions of the Industrial Disputes Act. 4. The contention on behalf of the management was therefore that the engagement of the workman had been for a particular purpose as a Salesman on contract for a period of one year and his services were extended from time to time only as long as the agency, which the Corporation had taken for sale and service of Eicher Motors vehicles was subsisting. On the eve of the termination of the agency, following a decision by the management to close the unit with recurring losses, there was no longer any work available for the workman and therefore, the termination that took effect did not amount to retrenchment as per the definition of Section 2(oo)(bb) of the Industrial Disputes Act. This was again repulsed by the contentions of the workman by pointing out that although the order of appointment purported to be for a contract period of one year, it was periodically extended for three more years, which only showed that there had been a continuous nature of employment which was C.W.P. No.4451 of 2000 -5- available and the mere limitation of the period of engagement or the characterization that the workman had been employed on a contract ought not to be understood as enabling the management to contend that the termination would not amount to retrenchment. I accept the contention on behalf of the workman as it found merited acceptance even at the Labour Court that there had been a continuous work which was available and it could not be taken that as there was any clause in the appointment letter or by the subsequent engagement that could have relieved the management of its statutory mandate to comply with Section 25-F of the Industrial Disputes Act in the event of its decision to terminate his services. I, therefore, also reject the contention on behalf of the management that the termination did not take effect as a retrenchment. 5. Learned counsel of both sides spoke elaborately on peripheral issues, though they are themselves fundamental in the sense that they alone would provide the jurisdiction to the Labour Court to adjudicate upon. Learned counsel for the petitioner states that the workman himself was not an Ex-serviceman and his entry into service was bad. His contention was that he had been court martialled and removed for the sympathy expressed for 'Operation Blue Star' and deserting service without appropriate authorization. Learned counsel refers to the definition of Ex-serviceman under Section 2(e) of the Punjab Ex-servicemen Corporation Act, which reads as follows:- “a person who is ordinarily residing in the State of Punjab and has served in any rank, whether as combatant or non combatant, in the Indian Armed Forces or Armed Forces of C.W.P. No.4451 of 2000 -6- the former Indian States (but excluding the Assam Rifles, Defence Security Corps, General Reserve Engineering Force, Lok Sahayak Sena, Jammu & Kashmir Militia and Territorial Army) for a continuous period of not less than 6 months after attestation and has been released, otherwise than by way of dismissal or discharge on account of misconduct or inefficiency, and in the case of a deceased or incapacitated Ex-serviceman includes his wife, children, father, mother, minor brother, widowed daughter and widowed sister, wholly dependent on such Ex-serviceman immediately before his death or incapacitation.” 6. According to the learned counsel, the workman did not serve in any rank as a combatant or non-combatant and he could not also be said to be a person whose services were terminated otherwise than by dismissal or discharge on account of misconduct or inefficiency. Since in this case, he had been dismissed for desertion, he will not qualify for the definition of the Ex-Serviceman. Learned counsel for the respondent, however, contends that the Government of India vide its proceedings dated 18.06.1990 had directed that persons, who had been dismissed as Army deserters in the aftermath of Operation Blue Star be converted as discharged and to be treated at par with Ex-serviceman for employment. This directive was also approved by the Punjab Government in the year 1998. The letter of the Government of Punjab to the Director, Sainik Welfare Punjab (Annexure R-10 filed along with written statement) states that the Government of India had converted the dismissal of all Army C.W.P. No.4451 of 2000 -7- deserters effected in the aftermath of Operation Blue Star as discharged and that they were to be treated at par with Ex-servicemen to enable them to get loans under various schemes of the department for their resettlement. Annexure R-11 (10.11.97) is the proceedings of Directorate Sainik Welfare Punjab states that Pritihipal Singh Sohal had deserted the service during the Operation Blue Star, when verification had been sought by communication to the Commandant, ASC Centre, Bangalore, if the individual had deserted the service in the wake of Operation Blue Star. By the proceedings of the Directorate Sainik Welfare dated 15.06.1998, all the District Sainik Welfare Officers, Punjab had been informed that they should take note of the fact that Army deserters affected in the aftermath of Operation Blue Star were to be declared at par with Ex-servicemen for the purpose of employment and self-employment. It is seen that Prithipal Singh Sohal had been enrolled at Amritsar on 04.01.1983 and had been posted at Bangalore on 21.12.1987, awarded to suffer three months rigorous imprisonment in civil prison and to be dismissed from service. In view of the proceedings of the Government, I have no doubt in my mind that the workman shall be treated as an Ex- serviceman. Even otherwise, it is not as if any concealment was practised by the workman at any stage at the time of securing employment with the petitioner-Corporation. Having admitted his status as such and giving him employment, I am of the view that the Corporation was estopped from denying the status of the workman as an Ex-serviceman. 7. Even as regards the contention that the workman did not C.W.P. No.4451 of 2000 -8- conform to the definition as such under the Industrial Disputes Act by the fact that the workman had been a Sales Executive, I am of the view that such a contention is not tenable. The Labour Court rejected such a contention by the reasoning that high-sounding designation given to the workman did not in itself determine his status and the real test being the dominant nature of the functions and duties, it noted that the order of appointment itself did not specify the details and nature of the duties and functions of the job for which appointment was given. The Labour Court recorded the fact that the workman had deposed without challenge from the management that his main duty as a Salesman was to perform clerical/liaison duty assigned to him from time to time and he had also been preparing the bills of the sold vehicles at auto workshop and brought on record copies of the bill so prepared by him. The Labour Court found that there was no evidence to show that the workman had been performing any supervisory function or duty as having been assigned managerial or administrative functions. The finding of the Labour Court accords with proper legal reasoning and it does not require any inference before this Court. 8. The residual contentions on behalf of the management were, in my view, the contentions that rivet attention for a serious consideration: one, that the workman was a protected workman and therefore, the termination that was made without complying with the requirements of Section 31(3) of the Industrial Disputes Act made the termination illegal. The other contention was that even if the Eicher agency created to the Corporation by Eicher Motors had been terminated, there were other works which were available with the C.W.P. No.4451 of 2000 -9- Corporation to which the workman could have been absorbed. The cessation of work at the automobile agency ought not to result in retrenchment of the workman also. 9. On the issue whether the workman was a protected workman, the learned counsel appearing for the petitioner would state that a mere letter by a union seeking for recognition of a particular person as a protected workman will not avail such a status to the workman. In this case, it was an admitted fact that the Punjab Ex- servicemen Corporation Employees Union had petitioned to the management on 18.09.1987 providing a list of protected workmen that included the respondent herein also as one amongst them and describing his position as the General Secretary. The letter dated 18.09.1987 (Annexure R-6) to the written statement was a communication in response to a letter submitted by the management to the Assistant Labour Commissioner on 04.07.1987 to provide to them a list and seeking by a request to the management to convey in writing that the union be recognized by the management. Learned counsel for the respondent also put on record a copy of the communication from the Assistant Labour Commissioner to the Chairman-cum-Managing Director of the Corporation that an application had been made to declare certain named persons as protected workmen under the Industrial Disputes Act. The letter dated 22.04.1998 records the fact that two of the officials, namely P.P. Singh-G.M. Auto Workshop and Sh. Avtar Singh-Administrative Officer-PESCO Head Office had merely asked for a list of office bearers of the union who they wanted to be declared as protected workmen and that list had also been C.W.P. No.4451 of 2000 -10- submitted on 18.09.1987. There having been no communication from the management rejecting the request, the Assistant Labour Commissioner had stated that it was to be presumed that the workman P.S. Sohal, among others was to be taken as declared as protected workmen by the management. The Labour-cum-Conciliation Officer has himself given a decision on 23.07.1999 which has recited the fact that the trade union bearing registration No.63 dated 04.10.1995 had been sending regular annual list to the Registrar of Trade Unions, Punjab and the list of workmen prepared and communicated by the union to its employer contains the names of the office bearers employed with the industrial establishment. As per the Punjab Rules, the last date for making the application is 30th September of the year and not the 30th April and the attempt of the employer not to accord the status was only to frustrate the efforts of the union with regard to the declaration of protected workmen of the union. It consequently directed that the employer was required to recognize the protected workmen as per the opinion of the union communicated by them under Section 61(1) of the Industrial Disputes (Punjab) Rules, 1958. It has been held in P.H. Kalyani Vs. Air France Calcutta AIR 1963 SC 1756 that matter of determination of a person as a protected workman or not, is essentially a question of fact and the High Court shall not interfere with the finding recorded by a Labour Court. This judgment, however, does not come without its trappings, in that it states to the particular facts that a mere communication by the union to the company requiring a recognition and the failure of the management to respondent did not amount to a position that the C.W.P. No.4451 of 2000 -11- recognition had been granted. In that case the Hon'ble Supreme Court held that there must be some positive act on the part of the employer with regard to the recognition of an employee as a protected workman before he could claim to be protected for the purpose of Section 33 of the Industrial Disputes Act. The Hon'ble Supreme Court had affirmed a finding of the Labour Court that the workman was not a protected workman. In this case, the Labour Court has held that he was a workman and the Labour Court has also found that it was not merely a case of the management failing to respond; The management had sought for a list from the Union to a communication issued by the Labour Officer directing the management to accord recognition and ultimately the Labour Officer had also passed an order directing the management to recognize the union. In my view the workman's status as protected workman cannot be, in any way, be justifiably denied. 10. The question would still be whether Section 33(3) reproduced as follows operates: "Nothwithstanding anything contained in sub-section (2), no employer shall, during the pendency of any such proceeding in respect of an industrial dispute, take any action against any protected workman concerned in such dispute- (a) by altering, to the prejudice of such protected workman, the conditions of service applicable to him immediately before the commencement of such proceeding; or (b) by discharging or punishing, whether by dismissal or otherwise, such protected workman, C.W.P. No.4451 of 2000 -12- save with the express permission in writing of the authority before which the proceeding is pending. Learned counsel appearing for the management refers to a decision in The Bhavnagar Municipality Vs. Alibhai Karimbhai and others (1977) 2 SCC 350 that a retrechment does not necessarily mean altering the conditions of service. In paragraph 13 of the judgment, the Hon'ble Supreme Court held that retrenchment may not necessarily under all circumstances, amount to alteration of the conditions of service. For instance, when a wage dispute is pending before a Tribunal and on account of the abolition of a particular department the workers therein have to be retrenched by the employer, such a retrenchment cannot amount to alteration of the conditions of service. The Hon'ble Supreme Court was laying down the law in the context of the management deciding to entrust the work which had till then been performed by the workers to a contractor. On the employment of a contractor by the Municipality for the same work, the services of the workman became unnecessary and the management passed the orders of retrenchment. It was, therefore, clear that by the retrenchment of the workmen, even the temporary employment of workers ceased while the dispute between the Tribunal was pending in order to prevent the termporary and insecure status of certain class of workmen. As the learned counsel for the workman pointed out that even while the Hon'ble Supreme Court held that retrenchment may not at all times amount to alteration in the conditions of service, in that case the Hon'ble Supreme Court found that the dispute regarding the conversion of termporary workmen into C.W.P. No.4451 of 2000 -13- permanent workman was directly an issue and was the subject of consideration before the Tribunal and if that was sought to be changed in getting the work done through a contractor, it was incumbent upon management to obtain prior permission of the Tribunal. In that case, the Hon'ble Supreme Court was dealing with the reference of Section 33(1)(a), but in this case by reference to Section 33(3). The interdict under section 33(3) covers a wider range of actions of the management than 33 (1) or (2). The discharge or punishment contemplated under the latter shall be for a misconduct, but under the former, the discharge need not for any misconduct. We are not examining this case in the context of any change in terms of service or misconduct leading to discharge or any punishment. So long as the workman was a protected workman and the action of the managment results in discharge, or inflicted with punishment by dismissal or otherwise, without express permission in writing of the authority before which the proceeding is pending, it falls foul of section 33(3). The action of the Management will therefore be void and inoperative as per the decision of the Hon'ble Supreme Court in Jaipur Zila Sahakari Bhoomi Vikas Bank Ltd v Ram Gopal Sharma (2002) 2 SCC 244. The only relevant point that would fall for consideration in the present case is the nature of relief that shall be afforded to the workman whose discharge from service on 9.4.1998 has resulted not on the ground of any misconduct but on the ground that the motor agency with M/s Eischer was being terminated and hence there was no availability of work. 11. The entire recitals found in the order are required to be C.W.P. No.4451 of 2000 -14- produced for an examination of the effect:- "....You were engaged as Sales Executive in PESCO AUTO Workshop w.e.f. 1st Sep 1997 for contractual period of one year on an all-inclusive consolidated salary of Rs.3250/- per month. As per para 5 of the letter you were required to ensure sale of such number of vehicles in the year whose sale commission is equal to or more than Rs.40,000/-. While reviewing your performance for the last seven months period your progress is NIL. Since the Corporation was incurring heavy cost on account of carrying out dealership and maintenance of sale inventory, the management had decided to cancel the dealership with Eicher Motors Limited. Accordingly, your services are also no more required and terminated with immediate effect. Since your engagement was for a period of one year w.e.f. 01.09.1997, salary amounting to Rs.16,250/- for the period April 98 to August 98 (i.e. 01.04.1998 to 31.08.1998) is being transferred to your salary account with Punjab National Bank, Palsoura. Other dues, if any, are being worked out separately." The impugned order of termination reads that on reviewing individual performance of the workman, it is stated that the progress was nil. The Corporation itself was running under loss and the management had decided to cancel the dealership with Eicher Motors. It is in evidence and it is not denied anywhere that the agency with C.W.P. No.4451 of 2000 -15- Eicher Motors stood terminated and it is no longer subsisting. It is again an admitted fact when the workman had been employed as a Sales Executive, the letter of appointment specifically stated that he was being appointed in PESCO AUTO and I have already observed that the order of appointment marks in one corner a refrence to Eicher Mistubishi within a box, meaning thereby that they were considering him as reserved to this particular unit. The order of appointment provided among other terms, a specific entitlement to commission which he could have earned only if he was working as a Sales Executive. According to the learned counsel appearing for the management, if the management had decided to cancel the dealership with Eicher Motors, it was simply a case of closure of one unit of functioning of the management. If there was no functional integrity of the automobile unit with other activities of the management, such as watch and ward facilities to various industrial