LPA No.11 of 2010 1 In the High Court of Punjab and Haryana, Chandigarh. LPA No.11 of 2010 (O&M) Date of Decision: 11.01.2010 Punjab Agro Industries Corporation. ....Appellant. Versus Presiding Officer, Labour Court and others ....Respondents. Coram:- Hon'ble Mr. Justice Adarsh Kumar Goel Hon'ble Mr. Justice Alok Singh Present: Mr. Arun Nehra, Advocate for the appellant. ... Adarsh Kumar Goel, J. (Oral). 1. This appeal has been preferred against the order of the learned Single Judge upholding the award of the Labour Court, setting aside reversion of the workmen to the lower scale. 2. The workmen were employed as Clerk-cum-Typists/Fertilizer Clerks or Senior Clerks/Senior Fertilizer Clerks in the pay scale of Rs.400- 600 and Rs.510-800 respectively. The management of the appellant – Corporation had higher posts of Assistants, Deputy Superintendents and Managers. On 6.3.1984, a decision was taken for restructuring the cadres from the posts of Assistants onwards. New cadres of Executive Grade-II and Executive Grade-I were created in the pay scale of Rs.700-1200 and 800-1400. Their earlier pay scale was Rs.600-1100. On a representation of LPA No.11 of 2010 2 the workmen, who were in grades lower to that of Assistants, order dated 1.3.1987 was passed placing them in Executive Grade-III in the pay scale of Rs.570-1080 from the pay scale of Rs.510-800. This was sought to be undone in a meeting held on 29.6.1989 after about a period of two years and four months. However, it was directed that personal pay in the revised grade will be protected. The workmen raised an industrial dispute, which was referred for adjudication. 3. Claim of the workmen was that no opportunity of hearing was given to them before reverting them to the lower pay scale. They having already worked in a higher pay scale for more than two years, could not be reduced to lower pay scale without any valid reasons and without opportunity of being heard. Reason that approval of the Board of Directors was not taken, was not valid as the Managing Director had the competence to grant higher pay scale, without approval of the Board of Directors. 4. The appellant – management contested the claim of the workmen by submitting that approval of the Board of Directors was required. 5. The Labour Court upheld the claim of the workmen with the following finding:- “According to the definition of the employer in the standing orders itself, the M.D. Is wholly solely the employer and apart from the M.D., it can be any other person who has been authorised by the corporation to act on its behalf. If the M.D., is employer he has got full authority to create upgrade any post and to promote any person. According to Ex.M4 which is also relied upon by the respondent, the delegation of powers by the LPA No.11 of 2010 3 Board ha been made in favour of the MD at page 8. According to entry at No.1 under the heading M.D. earlier the M.D. had power to create and upgrade the post up to pay scale of Rs.825- 1580 on non-technical side and 825-1700 on technical side. The powers were then amended and it was raised upto the pay scale of Rs.940-1850. The respondent relied upon entry No.2 which reads that the appointment and promotion against sanctioned post has to be made by selection committee consisting of four persons. According to respondent, since the post were not sanctioned to which the promotions were made, only it could be done with the recommendations of the selection committee. The argument apparently goes against the management. The recommendations of the sub committee is required only in case of appointment and promotion against sanctioned posts only and if the post of Ex.G-III and sale Rep. were not sanctioned as claimed by the respondent, the recommendations of the sub committee was not required. Under entry No.1 M.D. had unlimited powers to create and upgrade any post upto pay scale of Rs.940-1850. Admittedly, the workmen in question were either promoted or upgraded to the scale of Rs.570-1080 in 1987. Therefore, no approval of the BOD or of the selection committee was necessary.” 6. It was further observed that a benefit given could not be withdrawn after a period of two and a half years without giving an opportunity of hearing. Reliance was placed on the judgement of this Court in Varinder Chawla Vs. Chandigarh Administration, 1984 (1) All India LPA No.11 of 2010 4 Service Law Journal 422. 7. Aggrieved by the award of the Labour Court, the management filed a writ petition in this Court. Learned Single Judge upheld the view taken by the Labour Court, holding that the Managing Director had the competence to grant higher pay scale under the standing orders. On the question of legal status of standing orders, reliance was placed on judgement of the Hon'ble Supreme Court in Western India Match Co. Ltd. Vs. Workmen AIR 1973 SC 2650, U.P. State Electricity Board and another Vs. Hari Shanker Jain and another AIR 1979 SC 65, Workmen of Dewan Tea Estate and others Vs. The Management AIR 1964, The United Provinces Electric Supply Co. Ltd. Vs. T.N. Chatterjee and others, AIR 1972 SC 1201 and Rajasthan State Road Transport Corporation and another Vs. Krishna Kant etc. AIR 1995 SC 1715. 8. It was also observed that reversion after two and a half years without giving an opportunity of hearing to the workmen was not valid in view of the law laid down in Varinder Chawla's case (supra) and Balwant Singh Kataria Vs. State of Haryana and others 1997 (3) AIJ 301. 9. We have heard learned counsel for the appellant. 10. The contention raised by the learned counsel for the appellant is that no opportunity of hearing was required as it was a case of abolition of posts and that impugned award and judgement of learned Single Judge will create an anomaly by clubbing the posts of workmen with those of Assistants, which were promotional posts. In support of his submission, reliance was placed on a judgement of the Hon'ble Supreme Court in State of Haryana Vs. Des Raj Sangar another, (1976) 2 Supreme Court Cases 844. LPA No.11 of 2010 5 11. We are unable to accept the submission. Admittedly, the workmen worked on higher scales for a period of two and a half years and the Managing Director had the competence to grant higher pay scale. In such a situation, the benefit could not be withdrawn without giving an opportunity of hearing to the workmen. The judgement relied upon by learned counsel for the appellant in Des Raj Sangar's case (supra) is distinguishable. Therein posts had to be abolished on account of reorganisation of State. In the present case, higher pay scale had been given by the competent authority, which was sought to be reduced. Such a decision also amounts to change of service conditions, under Section 9-A of the Industrial Disputes Act, 1947 and such a decision could not be unilaterally taken by the management. 12. The Labour Court was, therefore, justified in upholding the claim of the workmen. Learned Single Judge rightly upheld award of the Labour Court. 13. We do not find any ground to interfere with the view taken by learned Single Judge. 14. Accordingly, the appeal is dismissed. ( Adarsh Kumar Goel ) Judge ( Alok Singh ) Judge 11.01.2010 sk.