1 6-wp-4243-2011.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY srj CIVIL APPELLATE JURISDICTION WRIT PETITION NO.4243 OF 2011 The Saraswat Co-op. Bank Limited ] Saraswat Bank Bhavan, ] Appasaheb Marathe Marg, ] Prabhadevi, Mumbai 400 025. ] .. Petitioner V/s. 1 The Saraswat Co-op. Bank ] Employees Union, ] Saraswat Co-op. Bank Ltd., ] 2nd Floor, Laxman Zulla, Ranade ] Road, Dadar, Mumbai 400 028. ] 2 The Presiding Officer, ] 1st Labour Court at Pune. ] 3 Mr. Rajendra Kondiba Darekar ] C/o. Abhijit (A) 25/4, Plot No.10, ] Chintamani Society, Sahwas, ] Karve Nagar, Pune 400 052. ] 4 Mr. Kishor Yallappa Injal ] C/o. N. N. Dalvi ] S. No.73/3, Plot No.20, Eknath ] Sadan, Yogi Park Society, Last Bus ] Stop, Dhankwadi, Pune 400 030. ] 5 Mr. Anant Omkar Mankar ] 269, Narayan Peth, Opp: Paranjape ] Hospital, Pune 400 030. ] 6 Mr. Vilas Sitaram Pawar ] S.No. 130, Near Tithal Mandir, ] Dandekar Pool, Pune 411 030. ] 2 6-wp-4243-2011.sxw 7 Pramila Raju Gawade ] (the legal representative/ the widow ] of the deceased Raju Dhondiram ] Gawade), 521, Center Street, ] Bhopale Chowk, Palangewada Camp ] Pune 411 001. ] .. Respondents. Mr. K. M. Naik i/b. Mr. S.P. Salkar, for the Petitioner. Mr. Nitin Kulkarni, for the Respondent. CORAM : K.K.TATED, J. RESERVED ON : 8th AUGUST, 2011. PRONOUNCED ON: 12th AUGUST, 2011. JUDGMENT 1 Heard the learned counsel for the Parties. 2 Rule. Rule made returnable forthwith. 3 By consent, matter is taken on board for final hearing, at the stage of admission itself. 4 By this Petition, under Articles 226 & 227 of the Constitution of India, the Petitioner-Original First Party challenges the order dated 22nd February, 2010 passed by learned preceding Officer, First Labour Court, Pune in Reference (IDA) No.168 of 1998, directing the Petitioner to reinstate Respondent Nos.3,4 & 6 in service to their original post in 3 6-wp-4243-2011.sxw continuity of service and pay full back wages to Respondent Nos. 3 and 4 from the date of Reference i.e. 11th March, 1998 and pay full back wages to Respondent No.6 from the date of Reference i.e. 11th March, 1998. The Court further directed the Petitioner to pay full back wages to Respondent No.7- legal representative of deceased Raju Dhondiram Gawade till 19th January, 2000. 5 A few facts of the matter are as under:- The Minister of Labour, Government of India, vide its order dated 19th February, 1998 was pleased to refer the matter to the Labour Court under the Industrial Disputes Act, 1947 (herein after referred as “the said Act”) for adjudication over the disputes as under:- “ Whether action of the management of Saraswat Co-op. Bank Ltd. in relation to its Zonal Office, Pune in not regularizing the services and thereafter, terminating the service of Shri Rajendra Kondiba Darekar and Shri Raju Dondiram Gawade with effect from June, 1991 and September, 1991 respectively and Shri Kishor Yellappa Injal from September, 1994 is legal and justified? If not, what relief the workman are entitled to?”. 6 Pursuant to the said Reference, the Respondent- Original Complainant through their Union filed statement of claims dated 19th February, 1998. Their case was that Respondent- Original Complainants were working with the Petitioner- Bank for the last several years as peon/ sweeper. They contended that they were appointed in the Bank and 4 6-wp-4243-2011.sxw terminated on following dates:- Sr. No Names Date of appointment Date of termination 1 Rajendra Kondiba Darekar 02/05/82 May 1991 2 Raju Dhondiram Gawade 1984 August 1991 3 Kishor Yallappa Injal 16/8/1988 September 1994 4 Anant Omkar Mankar April 1982 February 1992 7 The Respondent contended that they completed more than 240 days in service at the time of filing of the complaint. They submitted that the Petitioner without following due process of law, terminated their service in the year 1991, 1992 and 1994. Their contention was that at the time of termination of their services, the Petitioner has not followed the provisions of Section 25F of the Industrial Disputes Act, 1947 as well as Rules 80 and 81 of the Industrial Disputes (Bombay) Rules, 1957. No seniority list was ever displayed prior to the termination of the services and even the termination is in contravention of the Section 25G of the said Act, no last- cum-first rule was observed by the Petitioner prior to the termination of the services. These contentions were made by the Respondents in their complaint. The prayers made in their complaints read thus:- “(a):- this Hon'ble Court may be pleased to hold and declare that, the action of the Management of The Saraswat Co- operative Bank Limited in relation to its Zonal Office, Pune in not regularizing the services and thereafter terminating the services of Shri Rajendra Kondiba Darekar, Shri Raju Dhondiram Gawade in June 1991 and September 1991 respectively and 5 6-wp-4243-2011.sxw Shri Kishor Yellappa Injal from September 1994 is illegal and un-justified. (b) this Hon'ble Court may be pleased to direct the First Party Bank to make the concerned workmen regular in the services of the Bank after completion of their one year's continuous service with the First Party Bank and the workmen concerned in the Reference may be made as permanent and they may be given the benefits of the permanency after making them permanent. (c) this Hon'ble Court may be pleased to direct the First Party Bank to reinstate Shri Rajendra Kondiba Darekar, Shri Raju Dhondiram Gawade and Shri Kishor Yellappa Injal with full back wages and continuity of service together with all other consequential benefits. (d) any other relief in the interest of justice and equity may kindly be granted. (e) the cost of the Reference may be provided to the Second Party Union.” 8 In the said complaint, the Petitioner filed their Written Statement on 11th August, 1999 and second Written Statement on 18th February, 2000. The Petitioner in their Written Statement submitted that the Respondent – Original Workers were not the persons employed by the bank and there was total absence of employer-employee relationship. The concerned persons are, therefore, not workmen as defined under Section 2(s) of the said Act and the alleged dispute does not amount to an ' Industrial Dispute' as defined under Section 2(k) of the said Act. The Petitioner contended in their Written Statement that the Respondent- employees were “outsider” and “freelancers” who some time used to come to the Bank, seeking work of cleaning in the morning prior to 6 6-wp-4243-2011.sxw commencement of the working hours of the Bank along with some other outsiders and the Bank used to give them work in the remote past depending upon the availability of work on the first cum first serve basis at various branches. The availability of such work was always less then one hour on any day. The Bank further stated in their Written Statement that since the Respondents were not regular workmen, they stood excluded both from the provisions of settlement as well as Model Standing Orders. They denied that they were deemed to be permanent in the service or were orally terminated. The Bank further submits that the Reference made to Section 25F, 25G of the said Act and the Rules 80 and 81 is totally improper and uncalled for the obvious reason first that the concerned persons were not workmen of the Bank nor they were regularly engaged during working hours of the Bank, secondly, they were not retrenched. 9 The learned Preceding Officer of the Labour Court, Pune allowed Respondent's complaint. Hence present Petition. 10 The learned counsel appearing for the Petitioner submits that in the present case, the Reference made by the Central Government as per order dated 19th February, 1998 which is contrary to law. He submits that the learned preceding Officer of the Labour Court, Pune failed to consider that the appropriate Government being the State Government, the 7 6-wp-4243-2011.sxw Reference at the behest of Central Government was not maintainable and, therefore, the impugned Award is without jurisdiction. He further submits that admittedly, the Petitioner is Multi State Co-operative Bank, carrying on business in more than one state. Therefore, the competent authority is the State of Maharashtra and not the Central Government. In support of this contention, he relied on the judgment of Apex Court in the matter of Bharat Co-operative Bank (Mumbai) Ltd. v/s. Co-operative Bank Employees Union, reported in 2007 II CLR 160. In that case, the Apex Court held that in relation to Multi State Co-operative Bank, carrying on business in more than one State, the State Government is the competent authority. Paragraphs 26, 27, 28 and 29 of that judgment reads thus:- “Para-26:- In our view, there is no substance in the contention. The I.D. Act is a complete and self contained Code int itself and its working is not dependant on the BR Act. It could not also be said that the amendments in the BR Act either expressly or by necessary intendment applied to the I.D. Act. We, therefore, reject the contention advanced by learned counsel for the appellant on this aspect as well. Para-27:- Further, as noticed above, the definition of the “Banking Company” in clause (bb) of Section 2 of the I.D. Act being exhaustive, it is only with respect to the “Banking Company” falling within the ambit of the said definition in the I.D. Act , that the Central Government would be the appropriate government, which admittedly is not the case here. Para-28:- In the light of the analysis we have made of the provision contained in Section 2(bb) of the I.D. Act, we deem it unnecessary to dilate on the impact of the IDBIC Act on the I.D. Act. Para-29:- For all these reasons, we have no hesitation in upholding the view taken by the High Court that for the 8 6-wp-4243-2011.sxw purpose of deciding as to which is the “appropriate government”, within the meaning of Section 2(a) of the I.D. Act, the definition of the “Banking Company” will have to be read as it existed on the date of insertion of Section 2(bb) and so read, the “appropriate government” in relation to a multi- state co-operative bank, carrying on business in more than one state, would be the State Government.” 11 The learned counsel appearing for the Petitioner submits that in view of Apex Court judgment in the matter of Bharat Co-operative Bank (Mumbai) Ltd. (supra), the Reference made by the Central Government itself is bad in law. Therefore, the impugned Award passed by the Labour Court dated 22nd February, 2010 is liable to be set aside. 12 In reply to these contentions, the learned Counsel appearing for the Respondent submits that the said authority is not applicable in the present case, because, that decision came into existence after Reference made by Government by order dated 19th February, 1998 in the present case. In support of these contentions, he relied on the judgment of the Apex Court in the matter of Managing Director, ECIL Hyderabad v/s. B. Karunakar reported in 1993 II CLR 1129. In that case, Apex Court held that the ratio of authority / case is applied prospectively from the date of judgment only to the cases in which decision are taken and orders made from that date and does not apply to all the matters which either became final or are pending decision at the appellate forum or in the High Court or the Tribunal. Paragraphs 74 and 75 of that judgment read thus:- 9 6-wp-4243-2011.sxw “Para-74:- The ratio of the Supreme Court of U.S.A. consistently given the benefit of overruling decision to the successful party received commendations from the academic lawyers. In 'Introduction to Jurisprudence' 4th Ed. Lord Lloyd of Hampstead at p.858 stated that a strong argument against the Sunbrust approach is that potential litigants faced with outmoded doctrine are given no incentive to litigate. If they win, their case is governed by the old doctrine and new rule would apply only to disputes subsequently arising. Litigants who provide the Courts with opportunities to rid the normative order of outmoded doctrine are performing a social service, and deserve some reward for their exertions. Andrew G. L. Nicol in his 'Prospective Overruling – a Text for English Courts' [39 MLR 542 at 546 also stated that 'excepting the parties to the overruling decision from the denial of retroactivity, the courts which use this variation talk in terms of reward for the party who has persuaded them to see the error of their ways. They argued that unless the party to the instant case is given the benefit of new decision, there will be no incentive for him to raise the correctness of the old decision. Finally they say that if the new rule is not applied in the instant case, the overruling will be obiter only. Cross and Harris in their 'Precedent in English Law' have also argued on the same lines to give benefit to the party in the overruling case. P.S. Atiya and R. S. Summers in their 'Form and Substance in Anglo-American Law' at page 146 also stated that: “if litigants who persuade the court to overrule a bad precedent are not themselves accorded the benefit of the new law, would they have sufficient incentive to litigate such cases so that bad law is not perpetuated”. It is, therefore, argued to extend the benefit to the successful party in the case. Para- 75 Mohd. Ramzan Kahn's ratio giving the benefit to him and companion appellants was valid in law and not, therefore, per- incurlam and was legally given the reliefs. The contention of the counsel for the employees/ Govt. Servants that the denial of Ramzan Kahn's ratio to the pending matters offend Art. 14 is devoid of substance. It is seen that placing reliance on the existing law till date of Ramzan Khan, the employers treated that under law they had no obligation to supply a copy of the enquiry report before imposing the penalty. Reserving the orders and directing to proceed from 10 6-wp-4243-2011.sxw that stage would be a needless heavy burden on the administration and at times encourage the delinquent to abuse the office the final orders are passed. Accordingly, I hold that the ratio in Mohd. Ramzan Khan's case would apply prospectively from the date of the judgment only to the cases in which decision are taken and orders made from that date and does not apply to all the matters either became final or pending decision at the appellate forum or in the High Court or the Tribunal or in this Court.” 13 I have gone through the order dated 19th February, 1998, the Reference made by the Central Government, copy of Statement of Claim filed by the Respondent and both the authorities cited by the learned counsel for the Petitioner as well as Respondent. Admittedly, in the present case, the Petitioner is Multi State Co-operative Bank, carrying on business in more than one state. Therefore, considering the judgment in the matter of Bharat Co-operative Bank (Mumbai) Ltd. (supra), State Government is Appropriate Authority in the present case and not the Central Government. Therefore, the Reference itself is bad in law. 14 The learned counsel appearing for the Petitioner submits that the Labour Court erred in coming to the conclusion that the Respondent- Original Applicant proved that they were working for more than 240 days in the preceding year at the time of filing complaint. He further submits that the Labour Court erred in coming to the conclusion that the xerox copy of document produced by the Respondent are admissible in evidence and relied on those xerox copies. The learned preceding Officer, First Labour 11 6-wp-4243-2011.sxw Court, Pune erred in coming to the conclusion that Respondent worked for more than 240 days in a preceding year of filing compliant and, therefore, they were entitled to the benefit of permanency. He submits that the Lower Court erred in coming to the conclusion that Petitioner has not completed the procedure prescribed by Section 25F of the said Act and therefore, the Respondent- Original Applicants are entitled to reinstatement with full back wages. The learned counsel appearing for the Petitioner submits that initially, the Respondent filed application for calling the documents from Petitioner on 30th September, 1999. The said application was rejected by the Labour Court on 15th July, 2000. The said order was not challenged by the Respondent in Higher Court. In similar way, the Respondent filed another application on 15th March, 2002 for directions to the Petitioners to produce some documents before the Labour Court. The said application was also rejected by the Labour Court on 29th October, 2004. He submits that Respondent has not brought on record any evidence to show that they were working with the Petitioner for more than 240 days in preceding year of filing of the complaint. In spite of rejection of application for production of documents, the Labour Court relied on xerox copies of the documents produced by Respondent and held that they proved that they were working for more than 240 days in the preceding year of filing of the complaint and, therefore, Respondents are entitled for reinstatement with full back wages. He submits that admittedly, there was no relationship of employer- 12 6-wp-4243-2011.sxw employee between Petitioners and Respondents and Respondents were engaged by the Bank as causal labour as and when work was available. Therefore, there is no question of following procedure as prescribed under Section 25F of the said Act. Therefore, the impugned order passed by the Tribunal is liable to be set aside on this ground also. 15 The learned counsel appearing for the Respondent vehemently opposed the present Petition. He submits that the Petitioner suppressed the material fact from the Court. He submits that twice the Respondent made application before the Labour Court for directions to the Petitioners to produce the documents to show that the Respondents were working with the Petitioners for the last several years and particularly they worked for more than 240 days in the preceding year of filing of the complaint. Both the applications were opposed by the Petitioner. He submits that the Respondents produced xerox copies of documents before the Labour Court and Labour Court rightly relied on those documents for coming to the conclusion that Respondent worked for more than 240 days in the preceding year with the Petitioner and, therefore, Respondents are entitled for all the benefits of permanency of employment. 16 I have gone through both the applications filed by the Respondent for production of documents, reply filed by the Petitioners and 13 6-wp-4243-2011.sxw the order passed by the Labour Court. After scrutiny of the documents on record, it is impossible to hold that the Respondents were working with the Petitioner for more than 240 days in the preceding year, as the Respondent failed to produce any cogent evidence on record that they worked for more than 240 days in the preceding year of filing of the complaint. Therefore there is no question of following the procedure as prescribed under Section 25F of the said Act. In any case, the Respondents were employed with the Petitioners for specific period and once that period is over, they are not entitled to claim any benefits. Our High Court in the matter of Prakash Pandurag Sawant v/s. Punjab & Sindh Bank, reported in 2007( 3) – Mah. Law Journal 882, held that when a workmen engaged from time to time for a fixed period on temporary basis for the work required, then on the expiry of the period of contractual appointment would not amount to retrenchment even if the employee had worked for more than 240 days in the preceding calender year. Paragraphs 12 and 13 of that judgment read thus:- “Para-12: 2. Insofar as the first ground of challenge is concerned, it is an undisputed position that the engagement of the Petitioners was temporary in nature. Each of the Petitioners was engaged for a specified term. Upon the expiry of the period of engagement, the tenure during which the Petitioners came to be engaged stood concluded as a result of the non renewal of the contract of employment. There is merit in the submission that was urged on behalf of the First Respondent therefore that the termination resulting from a non-renewal of a contract of employment will not fall within the definition of the expression “retrenchment” for the purposes of Section 2(oo) of the Industrial Disputes Act, 1947. Section 2(oo) defines 14 6-wp-4243-2011.sxw retrenchment to mean the termination by the employer of the service of a workman for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action. The definition, however, specifically excludes certain categories of termination and one of them, in clause (bb) is the termination of the service of a workman as a result of a non- renewal of the contract of employment between the employer and the workman concerned on its expiry or when a contract is terminated under a stipulation in that behalf contained therein. This position is amplified in several judgments of the Supreme Court and at this stage, it would be perhaps appropriate to advert to two of the recent judgments on the subject. In Managing Director, Karnataka Handloom Development Corporation Ltd. v. Mahadeva Laxman Raval 2006 (12) scale 133, , the Supreme Court adverted to the earlier decisions inter alia in S. M. Nilajkar v/s. Telecom District Manager, Karnataka , (2003) 4 SCC 27, Morinda Coop. Sugar Mills Ltd. v/s. Ram Kishan (1995) 5 SCC 653. Anil Bapurao Kanase v/s. Krishna Sahakari Sakhar Karkhana Ltd. (1997) 10 SCC 599 and Kishore Chandra Samal v/s. Orissa State Cashew Development Corporation Limited Dhenkanal, 2006 (1) SCC 253. The Supreme Court has clearly held in these judgments that the disengagement of an employee upon the expiry of the period of contractual appointment or on the completion of the work for which an employee was engaged would not amount to retrenchment even if the employee had completed work to the extent of 240 days in the immediately preceding calender year. Section 25-F of the Industrial Disputes Act, 1947 applies to a case of retrenchment. The termination of the services of a workman as a result of the non renewal of a contract of employment would not amount to retrenchment as defined in Section 2(oo) and consequently, Section 25-F will not be attracted. The same principle was reiterated in a judgment of two Learned Judges of the Supreme Court in Municipal Corporation, Ludhiana v/s. Ram Pal 2006 II LLJ 235. Moreover, at this stage it would be also necessary to note that following the decision in Indian Cable Co. Ltd. v. Workmen (1962) I LLJ 409, the Supreme Court has held that when a casual employee is employed in different establishments even under the same employer (for example, the Railway Administration which has different administrative set ups, different requirements and different projects), the concept of continuous service cannot be applied. In such a case where the tenure of a workman has ended in one of the establishments and the workman has joined 15 6-wp-4243-2011.sxw another, the same would not amount to his being in continuous service. Though the decision in Indian Cable Co. Ltd. was laid down in the context of Section 25-G, the Supreme Court has held that the law for the purpose of counting the days of work in different departments controlled by an apex corporation will be governed by the same principles. DGM Oil and Natural Gas Corporation Ltd. v/s. Ilias Abdulrehman (2005) 2 SCC 183 and Union of India v. Jummasha Diwan (2006) 8 SCC 544. Para-13. In these circumstances, for the aforesaid reasons, the first submission cannot be accepted.” 17 In the present case, the appointment letter issued to the Respondent No.4 clearly shows that they worked on month to month basis only. It is specifically stated in the appointment letter that Respondent No. 4's appointment is only for one month. In respect of