* THE HON’BLE SRI JUSTICE RAMESH RANGANATHAN + W.P.No.25786 OF 1996 % Dated 23-12-2005 # ITC Limited. …. Petitioner Vs. $ The Presiding Officer, Labour Court, Guntur & another. …. RESPONDENTS ! Counsel for the Petitioner: Mr. C.R. Sridharan ^ Counsel for the Respondents: Mr. Ramarao Ghanta <GIST: > HEAD NOTE: ? Cases referred 1964(3) SCR 616 2 (1998)8 SCC 733 3 (2004)8 SCC 195 4 (2002)3 SCC 25 5 1964 (1) LLJ 6 1990 (supp) SCC 287 7 AIR 1995 SC 1715 8 1998(3) SCC 225; 9 AIR 1985 SC 603 10 1993 Supp(2) SCC 732 11 AIR 2003 SC 983 12 (1993)66 FLR 876 13 (1994)2 SCC 323 14 (1980)4 SCC 443 15 1990(II) An.W.R. 152 16 (1981)3 SCC 25 17 (2005)8 SCC 750 18 (1970)3 SCC67 19 (1985)4 SCC 71 20 AIR 1964 SC 477 21 (2004)8 SCC 246 22 (2005)5 SCC 100 23 (2005)8 SCC 450 24 (2005)8 SCC 481 25 (1979)3 SCC 371 26 (1993)1 LLJ 626 27 (2002) LLR 945 28 (2003)2 SCC 408 THE HON’BLE SRI JUSTICE RAMESH RANGANATHAN W.P.No.25786 OF 1996 ORDER: In this writ petition, the petitioner seeks to have the award of the Labour Court, Guntur in I.D.No. 356 of 1990 dated 27.08.1996, quashed. Facts, to the extent necessary for this writ petition, are that the petitioner, a company registered under the companies Act, 1956, carries on the business of procurement, threshing and export of unmanufactured tobacco to various countries, for which purpose it had set up two factories at Chirala and Anaparthy. It is the petitioner’s case that the services of the 2nd respondent, commenced from 23.12.1989, that he completed his six months probation by 22nd June 1990, that on an overall assessment of his performance and suitability it was found that he was not suitable to be confirmed, more so as he had unilaterally and unauthorisedly absented himself from work from 29.07.1990 and having come to know that his services would not be confirmed, he had further abstained from work from 04.08.1990 onwards. The 2nd respondent is said to have attended office only on 28.08.1990, on which date, the order dated 08.08.1990, relieving him from services, was personally served on him. The 2nd respondent workman filed an application, under Section 2-A(2) of the Industrial Disputes Act, before the labour Court, the petitioner filed its counter affidavit thereto and the 2nd respondent filed his rejoinder. While the 2nd respondent examined himself as W.W-1, the petitioner examined two witnesses on its behalf. On behalf of the 2nd respondent Ex.W-1 to W-8 were marked as exhibits and on behalf of the petitioner Ex.M-1 to M-17 were marked as exhibits. The Labour Court, on taking note of the admission of M.W-1 that no written order was communicated to the 2nd respondent during his period of probation regarding the target of work and that Exs.M-1 to M-6 do not contain the dates as to when they were prepared, held that there was any amount of doubt with regards the genuineness of Exs.M-1 to M-6, as copies thereof were not supplied to the 2nd respondent at any time, they did not even contain the dates of which they were prepared and that during his probation the management did not give any memo or notice to the 2nd respondent workman asking him to give his explanation for his unsatisfactory work. The Labour Court observed that when the 2nd respondent examined himself as W.W-1, he was not even confronted with Exs.M-1 to M-6 nor was any suggestion put to him that his work was not found upto the mark, that he had to improve his work, that it was unsatisfactory and it was for the first time during the course of evidence of M.W-1 that these documents Exs.M-1 to M-6 were filed into court. The Labour Court held that, in such circumstances, no sanctity could be attached to these documents. After taking note of the evidence of W.W-1, that he had successfully completed his probation to the satisfaction of his superior officers, had requested M.W-1 to give him a letter confirming his probation after completion of the six month period but was told to continue as a regular employee and that no such confirmation letter was necessary, the Labour Court held that the petitioner-employer had admittedly not extended the period of probation of the 2nd respondent workman after completion of six months, on the other hand had allowed the 2nd respondent to continue in service thereafter and that termination of his services, without extending the period of probation and without giving notice or conducting an enquiry regarding his unsatisfactory work, was illegal and invalid. The Labour Court held that there was an implied confirmation of service when an employee was permitted to work beyond the original period of six months and that termination of service, contrary to Section 25-F of the Industrial Disputes Act, was illegal and void. With regards the petitioner’s contention that the 2nd respondent was not entitled to claim the benefit of protection under the I.D. Act, since he had not completed 240 days of continuous service, the Labour Court took note of the 2nd respondent’s contention that he was appointed on 18.12.1989, that he had worked upto 03.08.1990, that he had applied for leave from 04.08.1990 to 10.08.1990, had joined duty on 12th August, had worked from 12th August to 14th August, 1990, and had gone to his village, since he had received an urgent message, intending to report back to duty after 15th August which was a public holiday. However, he was not able to come back and join duty and had therefore issued a telegram requesting for grant of leave for a period of one week and had thereafter come back on 28th August, on which date he was informed that his services were determined and he was served a copy of Ex.W- 8 order. The Labour Court drew adverse inference against the petitioner on the ground that, in spite of directions, they did not choose to produce the tappal book to show as to whether the telegram sent by the 2nd respondent had been received by them or not. The Labour Court held that the order of termination of the services of the 2nd respondent (Ex.W-8) dated 08.08.1990 did not contain reasons for termination, that no enquiry was conducted and that no notice was given to the workman prior to the said order. The Labour Court further held that since the 2nd respondent was continued in service, even after expiry of the period of probation of six months, as a regular employee, and his services were terminated without giving him one month’s notice or retrenchment compensation as required under Section 25-F of the Industrial Disputes Act, termination of his services was illegal. Despite taking note of the contention of the 2nd respondent that he did not seek declaration of his probation, the labour Court, however, held that since the management had failed to extend the period of probation, they did not state that the performance of the 2nd respondent was not satisfactory during the period of probation, no rules or service conditions were produced to show that the period of probation of six months could be extended, the silence on the part of the management, even after completition of the period of six months probation by the 2nd respondent, impliedly showed that he was allowed to continue in service as a regular employee as he had completed his probation satisfactorily. The Labour Court held that termination of the services of the 2nd respondent was illegal, invalid and opposed to principles of natural justice. For the reason that the 2nd respondent had merely sent a telegram and had not approached the authorities for sanction of leave for his absence nor had he submitted any written representation requesting that he be reinstated into service, the Labour Court held that he should be deprived of back wages. The Labour Court, by its award in I.D.No. 356 of 1990 dated 27.08.1996, set aside the order dated 08.08.1990 relieving the 2nd respondent from service and directed his reinstatement with continuity of service but without backwages. Aggrieved by the award, to the extent the 2nd respondent was directed to be reinstated with continuity of service, the present writ petition is filed by the petitioner-employer. Before this court, Sri C.R. Sridharan, learned counsel for the petitioner, would contend that since the 2nd respondent had not completed 240 days of service at all, let alone 240 days continuous service within the 12 month period prior to termination of his services, Section 25-F of the Industrial Disputes Act has no application. Learned counsel would submit that since the 2nd respondent was appointed as a probationer on 18.12.1989 and had abstained from service from 3.8.1990 onwards, he had not put in the required service of 240 days in the 12 months period prior to his termination and even if all the days during the period from 18.12.1989 till 3.8.1990 are taken into account, he would have worked only for 229 days. Learned counsel would rely on Sur Enamel and Stamping Works Ltd. v. Workmen, State of Haryana v. Om Parkash and Municipal Corporation, Faridabad v. Srinivas in this regard. Learned counsel would submit that it is for the workman to establish that he had completed 240 days of service and since the said burden was not discharged by the 2nd respondent, the award of the Labour Court directing reinstatement of the workman on the ground of violation of Section 25 F of the Industrial Disputes Act is illegal and is required to be set aside. Learned counsel would rely on Range Forest Officer v. S.T. Hadimani and Municipal Corporation, Faridabad3. Learned counsel would submit that merely because an employee was permitted to work beyond the six month period of probation, stipulated in the order of appointment, it would not entitle him to claim automatic confirmation in service and it is only if the competent authority passes an order in this regard, can the services of an employee be said to have been confirmed. Learned counsel would rely on Express Newspapers v. Labour Court, Madras, K.A. Barot v. State of Gujarat, Rajasthan State Road Transport Corporation v. Krishna Kant, Oswal Pressure Die Casting Industry v. Presiding Officer; Dhanjibhai Ramjibai v. State of Gujaraj; Ramnarain Yadav v. State of Haryana; The Commissioner of Police, Hubli v. R.S. More. Learned counsel would rely on a judgment of the Division Bench of this Court in Divisional Manager, L.I.C. of India v. M. Venogopal as confirmed by the Supreme Court in M. Venugopal v. Divisional Manager, L.I.C. of India in support of his submission that termination of services of a probationer would not amount to retrenchment in view of Section 2(oo)(bb) of the Industrial Disputes Act, 1947. Sri Ghanta Rama Rao, learned counsel for the 2nd respondent workman, would refer to the certified standing orders of the company to contend that in view of Clause 3, more particularly Clause 3(b), whereunder a probationary worker is defined as one who is provisionally employed to fill a vacancy in Clerical or Class ‘A’ or Class ‘B’ (Engineering Department) and has not completed the period of probationary employment specified in his letter of engagement, the services of the 2n d respondent must be deemed to have been confirmed. Learned counsel would submit that since the period of probation fixed in the order of appointment is six months which period has been completed by the 2nd respondent, he cannot be said to be a probationery worker under the certified standing orders of the company and he must be deemed to be a regular employee. Learned counsel would contend that irrespective of whether or not the 2nd respondent workman had worked for 240 days, in the 12 month period prior to his termination, it was always open to him to approach the labour court under Section 2A (2) of the Industrial Disputes Act challenging termination of his services and would rely on Surendra Kumar Verma v. Central Govt. Industrial Tribunal-cum-Labour Court and R. Mallesham Vs. The Additional Industrial Tribunal-Cum- Additional Labour Court, Hyderabad. Learned counsel would submit that since the Labour Court, on a proper appreciation of the evidence on record, had rightly come to the conclusion that the 2nd respondent is deemed to have been confirmed in service, this Court, in exercise of its extra-ordinary jurisdiction under Article 226 of the Constitution of India, would not sit in appeal over the findings of the Tribunal, nor would it re- appreciate the evidence on record to come to a conclusion different from that of the Tribunal. Before examining the rival contentions, it is necessary to note certain provisions of the Industrial Disputes Act, relevant to the present case. Section 2(k) defines “Industrial Dispute” to mean, any dispute or difference between employers and employers or between employers and workmen, or between workmen and workmen, which is connected with the employment or with the conditions of labour, of any person. Section 2(oo) defines “retrenchment” to mean, 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, but does not include- (a) voluntary retirement of the workman; or (b) retirement of the workman on reaching the age of superannuation if the contract of employment between the employer and the workman concerned contains a stipulation in that behalf; or (bb) termination of the service of the workman as a result of non-renewal of the contract of employment between the employer and the workman concerned on its expiry or of such contract being terminated under a stipulation in that behalf contained therein; or (c) termination of the service of a workman on the ground of continued ill-health. Section 2(s) defines workman to mean, any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under the Act, in relation to an industrial dispute, to include any such person who has been dismissed, discharged or retrenched in connection with or, as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute. Section 2-A reads thus: 2-A. Dismissal etc., of an individual workman to be deemed to be an Industrial Dispute:- (1) Where any employer discharges, dismisses, retrenches or otherwise terminates the service of an individual workman, any dispute or difference between that workman and his employer connected with, or arising out of, such discharge, dismissal retrenchment or termination shall be deemed to be an industrial dispute notwithstanding that no other workman nor any union of workmen is a party to the dispute. (2) Notwithstanding anything in Section 10, any such workman as is specified in sub- section (1) may, make an application in the prescribed manner, direct to the Labour Court for adjudication of the dispute referred to therein; and on receipt of such application, the Labour Court shall have jurisdiction to adjudicate upon any matter in the dispute, as if it were dispute referred to or pending before it, in accordance with the provisions of this Act, and accordingly all the provisions of this Act shall apply in relation to such dispute as they apply in relation to any other industrial dispute. Section 2-A creates a legal fiction. Any dispute connected with, or arising out of discharge, dismissal, retrenchment or termination is deemed to be an industrial dispute and in such circumstances the workman is entitled under sub-section (2) thereof to make an application to the Labour Court for adjudication of the dispute without having to seek a reference under Section 10 of the Act. Chapter V-A of the Industrial Disputes Act relates to lay off and retrenchment and Section 25-B and 25-F thereunder read thus:- 25-B. Definition of continuous service:- For the purposes of this chapter, 1. a workman shall be said to be in continuous service, for a period if he is, for that period, in uninterrupted service, including service, which may be interrupted on account of sickness or authorized leave or an accident or a strike which is not due to any fault on the part of the workman. 2. Where a workman is not in continuous service within the meaning of clause (1) for a period of one year or six months, he shall be deemed to be in continuous service under an employer- a. for a period of one year, if the workman, during a period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer not less than- i. one hundred and ninety days in the case of a workman employed below ground in a mine; and ii. two hundred and forty days, in any other case: b. for a period of six months, if the workman during a period of six calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than i. ninety-five days, in the case of a workman employed below ground in a mine; and ii. one hundred and twenty days, in any other case. Explanation:- For the purposes of clause (2), the number of days on which a workman has actually worked under an employer shall include the days on which- i. he has been laid-off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Orders) Act, 1964 (20 of 1946), or under this Act or under any other law applicableto the industriall esablishment; ii. he has been on leave with full wages, earned in the previous year; iii. he has been absent due to temporary disablement caused by accident arising out of, and in the course of his employment; and iv. in the case of a female, she has been on maternity leave; so however, that the total period of such maternity leave does not exceed twelve weeks. 25-F. Conditions precedent to retrenchment of workmen:- No workmen employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until- a. the workman has been given one month’s notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workmen has been paid in lieu of such notice, wages for the period of the notice. b. The workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days’ average pay (for every completed year of continuous service) or any part thereof in excess of six months; and c. Notice in the prescribed manner is served on the appropriate Government (or such authority as may be specified by the appropriate Government by notification in the Official Gazette). To fall within the definition of retrenchment under Section 2(oo) and for claiming protection under Section 25-F of the Industrial Disputes Act, the concerned workman should be employed in an industry and must have rendered continuous service, for not less than one year, under the employer. Since admittedly the petitioner, who was initially appointed in December 1989, was terminated from service in August, 1990, he has not rendered continuous service of one year. In support of his submission that a workman is required to actually work for one year to claim protection of Section 25-F of the Industrial Disputes Act, Sri C.R. Sridharan, learned counsel for the petitioner, would rely on Sur Enamel and Stamping Works Ltd1, wherein the Supreme Court held thus: - “On the plain terms of the section only a workman who has been in continuous service for not less than one year under an employer is entitled to its benefit. “Continuous service” is defined in Section 2(eee) as meaning uninterrupted service, and includes service which may be interrupted merely on account of sickness or authorised leave or an accident or a strike which is not illegal or a lock-out or a cessation of work which is not due to any fault on the part of the workman. What is meant by “one year of continuous service” has been defined in Section 25-B. Under this section a workman who during a period of twelve calendar months has actually worked in an industry for not less than 240 days shall be deemed to have completed one year of continuous service in the industry. Nagen Bora and Monoharan were both reappointed on 10-3-1959. Their services were terminated on 15-1- 1960. Thus their total period of employment was less than 11 months. It is not disputed that period of their former employment under the company prior to their reappointment on 10-3- 1959 cannot be taken into consideration in computing the period of one year, because it is common ground that their reappointment on 10-3-1959 was a fresh appointment. The position therefore is that during a period of employment for less than 11 calendar months these two persons worked for more than 240 days. In our opinion that would not satisfy the requirement of Section 25-B. Before a workman can be considered to have completed one year of continuous service in an industry it must be shown first that he was employed for a period of not less than 12 calendar months and, next that during those 12 calendar months had worked for not less then 240 days. Whereas in the present case, the workmen have not at all been employed for a period of 12 calendar months it becomes unnecessary to examine whether the actual days of work numbered 240 days or more. For, in any case, the requirements of Section 25-B would not be satisfied by the mere fact of the number of working days being not less than 240 days.” The judgment in Sur Enamel and Stamping Works Ltd1 was considered in Surendra Kumar Verma14, wherein the Supreme Court held:- “Section 25-B as it read prior to Act 36 of 1964, in the light of the then existing Section 2 (eee), certainly lent itself to the construction that a workman had to be in the service of the employer for a period of one year and should have worked for not less than 240 days before he could claim to have completed one year’s completed service so as to attract the provisions of Section 25-F. That precisely was what was decided by this Court in Sur Enamel and Stamping Works Ltd. v. Workmen: (1964)3 SCR 616. Act 36 of 1964 has drastically changed the position. Section 2(eee) has been repealed and S. 25-B(2) now begins with the clause “where a workman is not in continuous service . . . for a period of one year”. These changes brought about by Act 36 of 1964 appear to be clearly designed to provide that a workman who has actually worked under the employer for not less than 240 days during a period of twelve months shall be deemed to have been in continuous service for a period of one year whether or not he has in fact been in such continuous service for a period of one year. It is enough that he has worked for 240 days in a period of 12 months; it is not necessary that he should have been in the service of the employer for one whole year. So we hold that Usha Kumari and Madhu Bala are in the same position as the other appellants.” It is not necessary for the purpose of sub-section (2)(a) of Section 25 B that the workman should be in service for a period of one year and that his service is continuous service within the meaning of sub-section (1). If his case is governed by sub-section(1) then it need not be covered by sub-section (2). Sub-section (2) envisages a situation not governed by sub-section (1) and provides for a fiction to treat a workman in continuous service