WP/5615/1998 : 1 : IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.5615 OF 1998 Kirloskar Copeland Ltd. Formerly known as Kirloskar Brothers Ltd., Satara .. Petitioners V/s. Chhaburao Anandrao Sawashe & Ors. .. Respondents Mr. K.S. Bapat with Mr. Anupam Surve i/b. Haresh Mehta & Co. for the Petitioners. Mr. Dhopatkar i/b. Mr. M.M. Jadhav for Respondent No.1. CORAM :SMT. NISHITA MHATRE, J. DATE :18 TH AUGUST, 2010. JUDGMENT: 1. The petitioners have impugned the order dated 24th April, 1996, passed by the Labour Court, Satara in Complaint (ULP) No.17 of 1988 and the order dated 11th August, 1998, passed by the Industrial Court, Kolhapur in Revision Application (ULP) No. 224 of 1996. The complaint filed by the respondent No.1 has been allowed to the extent that the order of dismissal has been found to be a grossly disproportionate punishment. WP/5615/1998 : 2 : 2. The Labour Court has directed that the complainant should be treated as “retrenched” with effect from 5th January, 1980 and retrenchment compensation should be paid to him on that basis along with the notice pay of one month. The Revision Application filed by the respondent No.1 was allowed. The order of the Labour Court was set aside and the matter was remanded for a fresh hearing. 3. The Industrial Court further directed that only if the Labour Court held that the complaint which had been filed is not barred by limitation, should the Labour Court embark on an enquiry regarding the merits of the matter. The Industrial Court further directed that if the delay, if any, was not condoned, the complaint should be dismissed. On remand, the Labour Court by its impugned order dated 24th April, 1996 held that the petitioners had committed an unfair labour practice under Item 1(a) of Schedule IV of the Maharashtra Recognition of WP/5615/1998 : 3 : Trade Unions & Prevention of Unfair Labour Practices Act, 1971, (for short “the Act”). The petitioners were directed to re-employ the respondent No.1 as a fresh “Welder” or on any other suitable equivalent post. Being aggrieved by this order of the Labour Court dated 24th April, 1996, the petitioners preferred a Revision Application being Revision Application (ULP) No.224 of 1996. That Revision Application was dismissed on 11th August, 1998. 4. The respondent No.1 was appointed as a “Welder” with the petitioners on 26th June, 1970. He was charged with serious acts of misconduct on 29th November, 1979. An enquiry was instituted against him. By an order of 5th January, 1980, the respondent No.1 was dismissed on the Enquiry Officer finding him guilty of the charges levelled against him. The respondent No.1 then filed Complaint (ULP) No.3 of 1980. By an order of 28th August, 1980, the Labour Court held that the charges had been proved against the respondent No.1 WP/5615/1998 : 4 : at an enquiry which was properly held. The Labour Court found that there is no victimization and that the dismissal order was passed bonafide and not in colorable exercise of the employers’ right, as contended by the respondent No.1. However, the Labour Court found that the punishment of dismissal was grossly disproportionate and was therefore an unfair labour practice under Item 1(g) of Schedule IV of the Act. The Labour Court, therefore, substituted this punishment by directing that the respondent No.1-workman should be retrenched from service. The Labour Court expressly refused reinstatement with continuity of service and back- wages. The respondent No.1 was to be treated “as if retrenched” from service. The Labour Court further directed that he be paid retrenchment compensation and notice pay as on the date of his dismissal from service. The Revision Application against this order of the Labour Court was filed in 1987 by the respondent No.1 being Revision Application (ULP) No.81 of 1987. It was rejected due to an inordinate delay of seven years in filing it. WP/5615/1998 : 5 : 5. Thereafter the respondent No.1 filed a fresh Complaint, being Complaint (ULP) No.59 of 1988 before the Labour Court, Sangli under Item 1 of Schedule IV of the Act. In this Complaint, the respondent No.1 contended that since the Labour Court by its order dated 28th August, 1980 passed in Complaint (ULP) No.3 of 1980 had retrenched the respondent No.1 from service, he was entitled to avail of the provisions of Section 25H of the Industrial Disputes Act. The respondent No.1 pleaded in his complaint: “5. It is contended by the complainant the opponent company turned down his request for re-employment as fresh welder though having retrenched the had right to re- employment in terms of S. 25 F of the Industrial Disputes Act, 1947. 6. It is further contended that the Opponent has remitted fresh welders in new vacancies one of which is one Shri. A.P. JADHAV from Tambave, Tal. Karad from 1.12.1984 No.606 and Ticket No.4361. The opponent has thus committed unfair labour practice in breach of award of the Labour Court dated 28.8.80. The WP/5615/1998 : 6 : Opponent committed unfair Labour Practice first on 1.12.84 when it recruited Shri. A.P. Jadhav in prefence to the complainant in breach of the Labour Court’s award and in breach of S. 25 F of the I.D. Act. It is unfair Labour Practice as per Schedule IV Item I.” . In this complaint, the respondent No.1 prayed that the petitioners be directed to employ the respondent No.1 as a fresh “Welder”. 6. The Labour Court, Sangli dismissed the complaint on 8th February, 1989 as it was barred by limitation. The respondent No.1, therefore, filed Revision Application (ULP) No.31 of 1989 by which an Industrial Court, Kolhapur, by its order dated 21st August, 1989 remanded the matter to the Labour Court. The Industrial Court directed the Labour Court to decide the application for condoning the delay within three weeks and in the event it was found that the delay could not be condoned, the Complaint was directed to be dismissed. The Labour Court was further directed to decide the Complaint WP/5615/1998 : 7 : on merits only if it was satisfied that the delay was required to be condoned. 7. The petitioners filed the written statement contending that the Complaint was not maintainable. The petitioners pointed out that the respondent No. 1 had been paid retrenchment compensation and notice wages on the directions of the Labour Court in Complaint (ULP) No.3 of 1980. The petitioners contended that this payment was made as the order of termination from service of the respondent No.1 was to be treated “as if retrenched”. The petitioners also contended that there was no existing employer-employee relationship between them and the respondent No.1 and, therefore, the Complaint was misconceived. It was further contended that the Complaint was barred by limitation. The petitioners also denied that there was any post of “Welder” available in the Company or that they had recruited a “Welder” from 1st December, 1984, as alleged in the complaint. WP/5615/1998 : 8 : 8. After the remand it appears that the complaint was transferred to the Labour Court, Satara and was renumbered as Complaint (ULP) No.17 of 1988. The Labour Court, by the impugned order dated 24th April, 1996, concluded that though the complaint was barred by limitation, there were sufficient grounds to condone the delay. The Labour Court further concluded that the respondent No.1 was entitled to a declaration that the petitioners had committed an unfair labour practice under Item 1(a) of Schedule IV of the Act and directed that the respondent No.1 should be reemployed as a “Welder” on fresh terms or on any other equivalent post. 9. Being aggrieved by the order of the Labour Court, the petitioners preferred Revision Application (ULP) No.224 of 1996 before the Industrial Court, Kolhapur. That Revision Application has been dismissed and hence the present Writ Petition. WP/5615/1998 : 9 : 10. The learned Advocate for the petitioners submits that both the Labour Court and the Industrial Court have erred in passing the impugned orders. According to him, while remanding Complaint (ULP) No.59 of 1988 (as it was numbered then before the Labour Court, Sangli), the Industrial Court, Kolhapur had directed the Labour Court to first ascertain whether the complaint was barred by limitation and to dismiss the same in case it was found to be barred. According to him, the Labour Court has by its impugned order proceeded erroneously to conclude that the delay ought to be condoned because the respondent No.1-workman had approached the Government Labour Office and the petitioners as well on several occasions for reemployment. He further submitted that the Labour Court has lost sight of the fact that the complaint was filed under Item 1 of Schedule IV of the Act for implementation of the provisions of Section 25H of the Industrial Disputes Act. He pointed out that the Labour Court had in the earlier complaint, i.e. Complaint (ULP) No.3 of 1980, already held that the WP/5615/1998 : 10 : termination from service of the respondent No.1 was justified though it should have been by way of retrenchment rather than dismissal. The order of the Labour Court has been complied by the petitioners and therefore it was not open for the respondent No.1 to file another complaint under Item 1 of Schedule IV of the Act before the Labour Court, according to Mr. Bapat. He then submitted that in any event the evidence on record did not disclose that any unfair labour practice had been committed by the petitioners much less one under Item 1(a) of Schedule IV of the Act. He pointed out that there was no allegation of victimization in the complaint itself, despite which the Labour Court has concluded that the petitioners had committed an unfair labour practice under Item 1(a) of Schedule IV of the Act. He then submitted that the entire complaint is misconceived as the question of reemployment of the respondent No.1 does not arise as the order of dismissal had been converted to one of termination from service “as if retrenched”. The learned Advocate urged that there WP/5615/1998 : 11 : was no retrenchment per se which entitles the workman to a relief under Section 25H of the Industrial Disputes Act. He relied on the judgment of the Supreme Court in the case of Anakapalle Co- operative Agricultural and Industrial Society Ltd. vs. Workmen and Ors., reported in AIR 1963 SC 1489 (V 50 C 218), and the judgment of the Division Bench of this Court in the case of Shree Steel Castings (Pvt.) Ltd., Nagpur vs. Vasanta S/o. Kundlik Kumbhare and Ors., reported in 2008 II CLR 84. 11. On the other hand, the learned Advocate for the respondent No.1 submitted that the orders of the Labour Court and Industrial Court are well founded and require no interference from this Court in its writ jurisdiction. He submitted that all that both the Courts below have directed is to reemploy the respondent No.1 as a “Welder” by way of a fresh appointment and no prejudice would be caused to the petitioners to do so. He then pointed out that when a workman is retrenched, he is entitled to WP/5615/1998 : 12 : reemployment as a matter of right under Section 25H of the Industrial Disputes Act and the orders of the Labour Court and Industrial Court are in consonance with that provision of law. He relied on a judgment of the Supreme Court in the case of Cawnpore Tannery Ltd., Kanpur vs. Guha (S.) & Ors., reported in 1961 (2) LLJ 110 and a judgment of the Rajasthan High Court in the case of Ram Chandra Yadav & Anr. vs. Rajasthan State Road Transport Corporation & Anr., reported in 1990 (2) L.L.J. 408. 12. In my opinion, the Labour Court and the Industrial Court have committed serious errors of law by allowing the complaint. While condoning the delay, the Labour Court has held that because the respondent No.1-workman had approached a Government Labour Officer and the officers of the petitioner- Company for reemployment, there was no delay in filing the complaint. This finding of the Labour Court is unsustainable. The order of the Labour Court in Complaint (ULP) No.3 of 1980 was passed on WP/5615/1998 : 13 : 20th August, 1980. There is no explanation at all as to why the respondent No.1-workman had to wait for seven years before filing the present complaint. Even assuming the cause of action arose in December, 1984 when a worker was employed as a “Welder” by the petitioners, there is still no explanation as to why it was necessary for the respondent No.1-worker to wait for four years from the date the new man was recruited before filing the complaint. The mere fact that the respondent No.1 approached the Government Labour Officer and the officers of the petitioner-Company cannot absolve him from approaching the Labour Court within the specified time i.e. within three months of the occurrence of an unfair labour practice. In these circumstances, in my opinion, the complaint ought to have been dismissed at the very threshold by the Labour Court. 13. Apart from this, the Labour Court has not cared to consider whether there could ever have been an unfair labour practice under Item 1 of Schedule IV WP/5615/1998 : 14 : of the Act if the workman was not reemployed by the petitioners or the petitioners had breached the provisions of Section 25H of the Industrial Disputes Act. A bare perusal of the provisions of Item 1 of Schedule IV of the Act indicates that the unfair labour practices mentioned therein are with respect to the discharge or dismissal of a workman. It was not the case of the workman in the complaint (ULP) No.17 of 1988 that he had been dismissed or discharged by the employer by indulging in unfair labour practices mentioned in Item 1 of Schedule IV of the Act. Therefore, the question of the Labour Court concluding that the workman had been victimized and consequently there was an unfair labour practice under Item 1(a) of Schedule IV of the Act does not arise. Moreover there is no pleading regarding victimization. 14. The finding of the Labour Court that the petitioners ought to have offered reemployment to the respondent No.1 in view of the provisions of Section 25H of the Industrial Disputes Act is WP/5615/1998 : 15 : perverse and unsustainable. The respondent No.1 in this case has not been retrenched. He was dismissed from service pursuant to an enquiry. The Labour Court in Complaint (ULP) No.3 of 1980 held that the misconduct committed by the respondent No.1 was proved. However, the Labour Court was of the view that the punishment of dismissal was not warranted. It, therefore, modified the punishment to one of termination of service “as if retrenched”. This order cannot by any stretch of imagination be construed as one which retrenches the workman. The provisions of Section 25H of the Industrial Disputes Act come into play where a person is retrenched and the employer proposes to take into his employment any other person, the workman retrenched must be given an opportunity to offer himself for reemployment. 15. In the case of Anakapalle Co-operative Agricultural and Industrial Society Ltd. (supra), the Supreme Court was dealing with a transfer of an undertaking. The Supreme Court has held that the WP/5615/1998 : 16 : workmen whose services were terminated in view of the provisions of Section 25FF of the Industrial Disputes Act were paid retrenchment compensation “as if the workmen had been retrenched”. The Supreme Court has observed that the legislature has not sought to place the closure of an undertaking on the same footing as retrenchment under Section 25F of the Industrial Disputes Act. The Supreme Court then observed thus : “20. Mr. Chari then argues that though in terms Section 25-H may not apply to the present case, the general principle underlying the provisions of the said section should be invoked in dealing with the claim made by the respondents against the appellant. His argument is that too much emphasis should not be placed on the identify of the individual employer in dealing with the present question and he suggested that what is important to bear in mind is the identity of the undertaking which was run by the vendor before and which is run by the vendee now. If the undertaking is the same, there is no reason why the workmen should not be entitled to claim continuity of service in the said undertaking. In our opinion, this argument is WP/5615/1998 : 17 : misconceived. Once we reach the conclusion that in the case of a transfer of any undertaking the Legislature has by Section 25-FF provided for payment of compensation to the employees on the clear and distinct basis that their services have been terminated by such transfer, it is sufficient to see how any questions of fair play or social justice would justify the claim by the respondents that they ought to be re-employed by the appellant. It is true that in cases falling under Section 25-F, workmen may get retrenchment compensation and they may yet be able to claim re- employment under Section 25-H and in that sense, some workmen may get both retrenchment compensation and re-employment. That is no doubt the effect of reading Section 25-F and Section 25-H together. But it must be borne in mind that in the case of retrenchment, the undertaking continues and only some workmen are discharged as surplus and it is the problem of re-employment of this small number of discharged workmen that is tackled by Section 25-H, a discharged workman may not be entitled to claim re-employment immediately after retrenchment or even so thereafter. It is only if the employer who discharged him as surplus requires additional workmen that his opportunity may occur.” WP/5615/1998 : 18 : 16. The Division Bench of this Court in the case of Shree Steel Castings (Pvt.) Ltd., Nagpur (supra) has held, by relying on the judgment of the Supreme Court in the case of Punjab Land Development and Reclamation Corporation Ltd., Chandigarh vs. Presiding Officer, Labour Court, Chandigarh and Ors., reported in 1990 3 SCC 682 , that it is not possible to stretch the fiction under Section 25FFF for any purpose beyond computation of compensation under Section 25F and in any case it cannot be extended to the provisions of Section 25H of the Industrial Disputes Act. 17. In the case of Punjab Land Development and Reclamation Corporation Ltd., Chandigarh (supra), the Constitution Bench of the Supreme Court approved of its earlier judgment in the case of State Bank of India vs. N. Sundara Money, reported in (1976) 1 SCC 822 , and held that the definition of “retrenchment” as contained in Section 2(oo) of the Industrial Disputes Act means “termination by the employer of the services of a workman for any WP/5615/1998 : 19 : reason whatsoever otherwise than as a punishment inflicted by way of a disciplinary action and those expressly excluded by the definition.” In paragraph Nos.74 and 75, the Supreme Court has held as follows: “74. .................................. Similarly, it is submitted, Section 25-H which deals with re- employment of retrenched workmen, can also have no application whatsoever, to a case of termination simpliciter because of the fact that the employee whose services have been terminated, would have been holding a post which ‘eo instanti’ would become vacant as a result of the termination of his services and under Section 25-H he would have a right to be reinstated against the very post from which his services have been terminated, rendering the provision itself an absurdity. It is urged that Section 25-F is only procedural in character along with Sections 25-G and 25-H and do not prohibit the substantive right of termination but on the other hand requires that in effecting termination of employment, notice would be given and payment of money would be made and the later procedure under Sections 25-G and 25-H would follow. WP/5615/1998 : 20 : 75. Mr. Bobde refutes the above argument saying that Sections 25-F, 25-G and 25-H relate to retrenchment but their contents are different. Whereas Section 25-F provides for the conditions precedent for effecting a valid retrenchment, Section 25-G only provides the procedure for doing so. Section 25-H operates after a valid retrenchment and provides for re-employment in the circumstances stated therein. According to counsel, the argument is misconceived firstly for the reasons that Section 2 itself says that retrenchment will be understood as defined in Section 2(oo) unless there is anything repugnant in the subject or context; secondly Section 25-F clearly applies to retrenchment as plainly defined by Section 2(oo); thirdly Section 25-G does not incorporate in absolute terms – the principle of ‘last come, first go’ and provides that ordinarily last employee is to be retrenched, and fourthly Section 25-H upon its true construction should be held to be applicable when the retrenchment has occurred on the ground of the workman becoming surplus to the establishment and he has been retrenched under Sections 25-F and 25-G on the principle ‘last come, first go’. Only then should he be given an opportunity to offer himself for re-employment. In substance it is submitted that there is no conflict between the definition of Section 2(oo) and the provisions of Sections 25-F, 25-G WP/5615/1998 : 21 : and 25-H. We find that though there are apparent incongruities in the provisions, there is room for harmonious construction in this regard. 76. For the purpose of harmonious construction, it can be seen that the definitions contained in Section 2 are subject to there being anything repugnant in the subject or context. In view of this, it is clear that the extended meaning given to the term ‘retrenchment’ under clause (oo) of Section 2 is also subject to the context and the subject matter. Section 25-F prescribes the conditions precedent to a valid retrenchment of workers as discussed earlier. Very briefly, the conditions prescribed are the giving of one month’s notice indicating the reasons for retrenchment and payment of wages for the period of the notice. Section 25-FF provides for compensation to workmen in case of transfer of undertakings. Very briefly, it provides that every workman who has been in continuous service for not less than one year in an undertaking immediately before such transfer shall be entitled to notice and compensation in accordance with the provisions of Section 25-F as if the workman had been retrenched. (emphasis supplied). Section 25-FFA provides that sixty days notice must be given of intention to close down any undertaking and Section 25-FFF provides for compensation to WP/5615/1998 : 22 : workmen in case of closing down of undertakings. Very briefly stated Section 25-FFF which has been already discussed lays down that “where an undertaking is closed down for any reason whatsoever, every workman who has been in continuous service for not less than one year in that undertaking immediately before such closure shall, subject to the provisions of sub-section (2), be entitled to notice and compensation in accordance with the provisions of Section 25-F, as if the workman had been retrenched.” (emphasis supplied). Section 25-H provides for re-employment of retrenched workmen. In brief, it provides that where any workmen are retrenched, and the employer proposes to take into his employment any person, he shall give an opportunity to the retrenched workmen to offer themselves for re-employment as provided in the section subject to the conditions as set out in the section. In our view, the principle of harmonious construction implies that in a case where there is a genuine transfer of an undertaking or genuine closure of an undertaking as contemplated in the aforesaid sections, it would be inconsistent to read into the provisions a right given to workman “deemed to be retrenched” a right to claim re-employment as provided in Section 25-H. In such cases, as specifically provided in the relevant section the workmen concerned would only be entitled to notice and compensation in