CW 5616/95 //1// In the High Court of Judicature for Rajasthan Jaipur Bench ** Civil Writ Petition No.5616/1995 M/s Universal Cylinders Ltd Alwar Versus Judge, Labour Court Bharatpur & Dena Nath Mehto Date of Order : 27/01/10 Hon'ble Mr. Justice Ajay Rastogi Mr. Kapil Manoj Chandra, for ) Mr. Manoj Kr.Sharma), for petitioner-Company Mr. Suresh Kashyap[, for respondent-workman Instant petition is directed against Award dt.29/04/1995 (Ann.11) whereby Labour Court, Bharatpur camp at Alwar in LCR-192/89 answered Reference (No.F.1(1)(1095/Labour/88) dt.19/09/89 in affirmative in favour of respondent-workman declaring his termination from service as illegal & unjustified; accordingly directed petitioner-Company to reinstate the workman with continuity of service along with full back wages. As alleged in statement of claim, the respondent-workman was engaged as Electrician in the year 1982 and was permanent employee; however, proceeded on sanctioned leave from 13/04/1987 to 12/06/87, which was extended by sending applications along with sickness certificates on 11/06/87, 19/09/87 & 13/10/87. It was admitted by petitioner employer as well that sickness certificates of Dr. RK Sinha CW 5616/95 //2// having been sent through registered post was received on 26/06/87 and certain other letters sent on 08/09/87 & 15/09/87 were also received by petitioner in their office but since he had not reported on duty after expiry of sanctioned leave despite notices having been sent on 09/07/87 & 21/08/87, in terms of Cl.17(c) of Standing Orders, name of workman was struck from attendance register and simultaneously communication was made terminating his services vide order dt.08/09/87 as he had voluntarily abandoned his job while having not reported after expiry of sanctioned leave and having remained absent without any intimation from 19/06/87 to 08/09/87 (81 days). The workman through Union sent letter to petitioner-Company on 14/12/87 explaining that he has regularly informed the Company while extending his sanctioned leave from time to time; as such his termination from service could not be justified and he may be permitted to join the service. However, the workman also submitted application (Ann.3) before Conciliation Officer on 23/12/87, to which reply was filed by petitioner-Company on 08/02/88 (Ann.4) but since no compromise could have arrived at between the parties, finally CW 5616/95 //3// appropriate Government made a Reference for adjudication of the dispute vide notification dt.19/09/89 (Ann.5) ad infra: “Whether action of the Manager, Universal Cylinder Ltd. in terminating services of Shri Dena Nath Mehto (duly represented by President, Rajasthan Trade Union (Rajasthan) CITU) Alwar) w.e.f. 08/09/1987 is legal & justified: if not, what relief, is the disputant entitled for ?” Respondent workman stated in his statement of claim that he was working as permanent employee in the establishment of the petitioner Company and his work was also satisfactory through out; however, he proceeded on sanctioned leave from 13/04/1987 to 12/06/87; and since he had fallen sick, could not resume back on duty after expiry of sanctioned leave but prior thereto, he sent letters seeking extension of his sanctioned leave on the ground of his sickness and finally he presented himself for reporting back on duty on 22/11/87 but was not permitted to resume his duty and the Union was also espousing his grievance and while petitioner company did not pay heed, an application was filed before Conciliation officer. The workman further alleged that before terminating his services, neither a reasonable opportunity of CW 5616/95 //4// hearing was afforded to him nor any disciplinary inquiry was held for alleged absence for 81 days; as such action of terminating his services is in violation of principles of natural justice and is also in contravention of S.25-F of Industrial Disputes Act, 1947 (“ID Act”). In support of his statement of claim, the workman filed his own affidavit reiterating the allegations as referred to in statement of his claim. Petitioner-Company filed its written statement raising preliminary objection inter- alia that since the workman had failed to report back on duty after expiry of sanctioned leave despite adequate notices being served; as such it was considered to be a case of abandonment of job on having remained wilful absence for 81 days in terms of Standing orders and provisions of S.25-F of the ID Act are not attracted. It has also been averred in para 2.9 that after termination of his service, the workman is running his own cycle repairing shop and is gainfully self-employed. However, it was admitted in their additional pleas that during the period while the workman was on sanctioned leave, sickness certificate issued by Dr. RK CW 5616/95 //5// Sinha on 08/05/87 (Ex.M/4) having been sent through registered post was received in his office on 26/06/87 but as it was related to six weeks’ period and even upon its expiry, when the workman did not report back on duty, notice was sent on 25/06/87 (Ex.M/1), 09/07/87 (Ex.M/2), & 21/08/87 (Ex.M/3); and despite these notices (Ex.M/1 to M/3) being sent, having failed to report back on duty, he was considered to have voluntarily abandoned the service; accordingly communication terminating his services was made on 08/09/87 (Ex.M/5). It was also averred in the written statement that since letters sent by workman on 19/09/87 & 13/10/87 were received after services being terminated vide order dt. 08/09/87; which had no legal effect and as regards his dues, it was averred that dues were sent on 01/10/87 through money order which was refused by the workman; as such could not have been paid. In support of written statement, affidavit was also filed of one Mahesh Joshi, the then General Manager of petitioner Company. However, during cross examination, it was admitted that one letter dt.08/09/87 of the CW 5616/95 //6// workman was received by petitioner Company in its office but prior thereto, three notices were already sent to the workman while medical sickness certificate was received on 15/09/87 after termination of his services; and since the workman reported for duty on 22/11/87 by that time, his name was struck from attendance register on 08/09/87, thus was not permitted to join duty and his dues were sent through money order, to which there was refusal on the part of the workman; and neither charge sheet was served nor inquiry was held; and provisions of S.25-F of the ID Act are not attracted. On the pleadings of parties and taking note of material on record, learned Labour Court finally held that the workman being permanent employee and having worked for almost more than five years in the establishment of petitioner Company, had proceeded on sanctioned leave from 13/04/87 to 12/06/87 and thereafter for extension of leave, medical certificates alongwith applications were duly received by petitioner company; as such it was well within their notice that the workman was continuously medically ailing; thereby could not report back on duty; in such circumstances, it cannot be CW 5616/95 //7// presumed to be a case of voluntary abandonment of job because of it being his temporary absence, was a case of retrenchment and standing order Cl.17(c) has no application and in absence of inquiry being held, action of petitioner terminating services of workman, besides being arbitrary, was in violation of principles of natural justice and accordingly while declaring it to be arbitrary & illegal, the Labour Court directed the petitioner to reinstate the workman with continuity of service alongwith full back wages. While notices were issued by this Court initially operation of Award dated 29/04/1995 (Ann.15) was stayed vide interim order dated 17/01/1996; and after service, application was filed on behalf of the workman U/s 17-B of the Act, 1947. However, in reply thereto, it was inter-alia averred by petitioner company that the workman is running his own cycle repairing shop and in support whereof, affidavit of one Mahesh Joshi the then General Manager was also filed disclosing that the workman was gainfully self employed and earning for his livelihood. Since earlier application U/s 17B of the ID Act, 1947 could not be finally heard, 2nd CW 5616/95 //8// application was moved on 08/07/2004, on which there was an order passed by this Court on 29/09/04 observing that there is already an application filed by workman U/s 17B, 2nd application for the same reason pendente first application cannot be entertained and hence second application was rejected being not maintainable. Counsel for petitioner-Company submits that after expiry of sanctioned leave on 13/06/1987, when the workman failed to report back on duty, letters were sent to him on 25/06/87, 09/07/87 & 21/08/87 having been placed on record before Labour court as Ex.M/1 to M/3 but despite that, the workman did not turn up nor reply to notices alleged to have been served upon was received by petitioner, it was considered to be a case of voluntary abandonment of job in terms of Standing Order Cl.17(c); and accordingly his name was struck out of attendance register while terminating his services vide order dt.08/09/87. Counsel further submits that once action has been taken by petitioner Company in terms of Standing Orders having statutory CW 5616/95 //9// force, provision of the ID Act has no application and reasonable opportunity of hearing was afforded to the workman by sending notices one after the other before passing order of termination impugned; in such circumstances, the finding recorded by Labour court under Award impugned holding termination being arbitrary and in contravention of principles of natural justice in the absence of inquiry being held, was wholly perverse and is not legally sustainable which deserves to be set aside. In support, Counsel placed reliance upon decision of Apex Court in N.E.L & P Co. Ltd Vs. K.Shreepathi (AIR 1958 SC 658). Counsel further submits that termination of services impugned vide order dt. 08/09/87 was not a retrenchment being covered U/s 2(oo)(bb) of ID Act while it was stipulated under condition of employment that their services would be governed by Standing Orders and once their action has been in confirmity with terms & conditions of Standing Orders having statutory force, it cannot be termed as retrenchment invoking provisions of S.25F of ID Act; and finding recorded under Award impugned is not legally sustainable. CW 5616/95 //10// Counsel further submits that even if action of termination of services of the workman is considered to be illegal, holding it to be in violation of provisions of S.25-F of the Act, there could not be a relief of reinstatement with back wages under Award impugned for the reason that petitioner Company is presently lying closed since June, 2002 and there cannot be any occasion at present on account of change in circumstances to reinstate the respondent workman. As regards back wages, it was specifically averred by petitioner Company in para 2.9 of written statement about workman having been gainfully self-employed while running cycle repairing shop, as was being specifically deposed by the then General Manager of the Company, which according to the Counsel, has not been taken note of by Labour Court. Counsel submits that in the facts of the case, finding recorded by learned Tribunal while awarding full back wages being totally perverse is not legally sustainable and deserves to be set aside. CW 5616/95 //11// Per contra, Counsel for respondent- workman while supporting the findings recorded by learned Labour Court, submits that before expiry of sanctioned leave for the period from 13/04/1987 to 12/06/87, applications along with sickness certificates were duly sent on 11/06/87, 19/09/87 & 13/10/87 seeking extension of leave on the ground of illness, which were admitted by the petitioner-Company to have been received in its office; as such petitioner Company was made aware of the fact that the workman could not join his duty on account of his sickness duly supported by medical certificates issued by registered medical practitioner. Counsel further submits that the impugned Award is duly supported by material on record and this Court will not sit as a Court of appeal to re-appreciate material on record so as to disturb finding of fact recorded by Labour Court; and in absence of any perversity therein, this Court should not interfere within limited scope of judicial review U/Art.226 & 227 of the Constitution. Counsel for workman further submits that since as pointed out by petitioner’s Counsel that the Company is lying closed since CW 5616/95 //12// June, 2002, in support whereof, there is no such documentary evidence on record; yet Counsel submits that if it is lying closed, in the interest of justice, the workman can be considered for grant of adequate lump sum compensation in lieu of reinstatement in case the Award impugned is upheld by this Court. This Court has considered rival contentions of both the parties and with their assistance, examined material on record. Facts almost stand un-controverted from material on record that the workman was permanent employee since 1982 till termination impugned and there was no complaint from any quarter against him; however, he proceeded on sanctioned leave for the period from 13/04/1987 to 12/06/87, which was extended by sending applications along with sickness certificates on 11/06/87, 19/09/87 & 13/10/87 while at the same time, as alleged by petitioner Company, notices (Ann. 9 to 11) were sent on 25/06/87, 09/07/87 & 21/08/87 asking him to report back on duty, but he failed to do so; as such his name was struck out of attendance register from 08/09/87 in the terms of Cl.17(c) Standing Order and his case was considered of voluntary abandonment of job. Here it is relevant to quote Cl.17(c) CW 5616/95 //13// of Standing Orders ad infra: “17. Termination of Employment and the notice thereof to be given by employer and employees: (c) Any workman who (i) absents himself without sanctioned leave for more than 10 calendar days or (ii) having been laid of under the Standing Order fails to report within 8 days of the passing of the recall notice or being otherwise notified; shall be deemed to have left the services of the company of his own accord.” A bare reading of provisions quoted supra depicts that if the workman remains absent for more than 10 calendar days, it can be presumed that he has left the job at his own accord. However, it cannot be ruled out that absence has to be examined as to whether it was wilful or not; for which he has to offer satisfactory explanation to the Manager of petitioner company assigning reasonable justification of his alleged absence & inability to report back to his duties on expiry of sanctioned leave. In the instant case, before expiry of period of sanctioned leave & much before the termination order was passed on 08/09/87, applications seeking extension of leave duly supported by CW 5616/95 //14// medical certificates were sent by workman which were indisputably received in the office of petitioner Company; as such the management of the Company was aware of the inability of the workman to report back on duty due to his sickness, which itself established reasonable justification for absence after expiry of sanctioned leave. S.2(oo) of the ID Act defines – “retrenchment” means 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, 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 the non- renewal of contract of employment between the employer and the workman concerned on its expiry or of such contract being terminated under a stipulation on that behalf contained therein; or (c) termination of the service of a CW 5616/95 //15// workman on the ground of continued ill health.” While S.25-F prescribes mandatory procedure to be followed before retrenchment becomes valid & legal – violation thereof visits with invalidation of the action with consequential results and the Standing orders may have statutory force, but cannot over-come, the requirement of provisions of ID Act, 1947 besides principles of natural justice and the right of employer given under Standing orders cannot affect statutory force of provisions of the ID Act. In Delhi Cloth & General Mills Ltd Vs. Sambhu Nath Mukherje (1977(4) SCC 415), the Apex Court observed ad infra: “Striking off the name of the workman from the rolls by the management is termination of his service. Such termination of service is retrenchment within the meaning of section 2(oo) of the Act. There is nothing to show that the provisions of Section 25-F (a) and (b) were complied with by the management in this case. The provisions of section 25-F(a), the proviso apart, and (b) are mandatory and any order of retrenchment, in violation of these two peremptory conditions precedent, is invalid.” In L.Robert D’ Souza Vs. Executive CW 5616/95 //16// Engineer Southern Railway (1982 (1) SCC 645), Apex Court rejected the contention that on expiry of leave, the termination of service is automatic and nothing further could be done; and striking off the name from the rolls for unauthorized absence from duty amounted to misconduct and termination of service on such grounds without complying with principles of natural justice would not be justified and is also in violation of S.25 of ID Act, 1947. In DK Yadav Vs. JMA Industries Ltd (1993(3) SCC 259), Apex Court observed that depriving a person of livelihood must be tested on the anvil of Art.14 and the procedure prescribed by a statute or statutory rule or rules or orders affecting civil rights or result in civil consequences would have to answer the requirement of Art.14. While examining the scope of Standing Orders vis-à- vis the ID Act, Apex Court further held ad infra: “7.…It is settled law that certified standing orders have statutory force which do not expressly exclude the application of the principles of natural justice. Conversely the Act made exceptions for the application of principles of natural justice necessary implication from specific provisions CW 5616/95 //17// in the Act like Ss.25F; 25FF; 25FFF; etc, the need for temporary hands to cope with sudden and temporary spurt of work demands appointment temporarily to a service of such temporary workmen to meet such exigencies and as soon as the work or service are completed, the need To dispense with the services may arise. In that situation, on compliance of the provisions of S.25F resort could be had to retrench the employees in conformity therewith particular statute or statutory rules or orders having statutory flavour may also exclude application of the principles of natural justice expressly or by necessary implication. In other respects, the principles of natural justice would apply unless the employer should justify its exclusion on given special and exceptional exigencies.” Apex Court further observed ad infra: “11. The law must therefore be now taken to be well-settled that procedure prescribed for depriving a person of livelihood must meet the challenge of Art. 14 and such law would be liable to be tested on the anvil of Art.14 and the procedure prescribed by a statute or statutory rule or rules or orders effecting the civil rights or result in civil consequences would have to answer the requirement of Art.14. So it must be right, just and fair and not arbitrary, fanciful or oppressive. CW 5616/95 //18// There can be no distinction between a quasi-judicial function and an administrative function for the purpose of principles of natural justice. The aim of both administrative inquiry as well as the quasi-judicial enquiry is to arrive at a just decision and if a rule of natural justice is calculated to secure justice or to put it negatively to prevent miscarriage of justice, it is difficult to see why it should be applicable only to quasi- judicial enquiry and not to administrative enquiry. It must logically apply to both.” In instant case, admittedly, no reasonable opportunity was afforded to the workman and no inquiry was held; at the same time, petitioner has failed to comply with requirement of S.25-F of the ID Act and once applications alongwith sickness certificates having been received in the office of petitioner Company, which came to their notice that the workman had failed to report back on duty due to his sickness duly certified by doctor’s certificate and his absence was not willful and that apart, if it being, as alleged to be a wilful absence, it was a misconduct and was required to afford him a reasonable opportunity of hearing before scoring his name CW 5616/95 //19// from the roll or terminating his services. In the facts of the instant case, temporary absence is not to be construed as abandonment of job; and question of leaving service of his own accord invoking clause 17 of Standing Order is not in any manner sustainable. Thus, in the opinion of this Court, termination of service of respondent workman vide order dt.08/09/87 was illegal and in violation of principles of natural justice; and this Court finds no manifest infirmity in the finding recorded by Labour Court under Award impugned which may require any interference. As regards submission made by Counsel for petitioner-Company with respect to applicability of S.2(oo)(bb) of ID Act, is without substance for the reason that it could be invoked in case of services of the workman being terminated on account of non-renewal of the contract of employment on its expiry or of such contact being terminated under a stipulation on that behalf. In the instant case, either of the conditions (supra) does not exist. The workman was appointed on permanent basis and after having served for five years, his services were terminated on the premise that he remained wilful absence allegedly CW 5616/95 //20// considering to be voluntary abandonment of job and not on account of non-renewal of contract on its expiry or due to such contract being terminated under a stipulated on that behalf. That apart, no pleading or documentary evidence in that respect has been placed on record which could substantiate that the contract was terminated under a stipulation on that behalf as alleged. As regards full back wages, this Court certainly finds substance in the submission made by Counsel for petitioner company for the reason that despite this fact having come on record that workman was gainfully self-employed in cycle repairing shop, as was duly supported by affidavit of the then Manager of the Company, the Labour Court failed to consider it while passing Award of full back wages. Even as per the law laid down in recent decision of Apex Court in Kendria Vidyalaya Sangathan Vs. SC Sharma (2005(2) SCC 263), initial burden is on the workman to show that he was not gainfully employed pending adjudication of industrial dispute and only thereafter, employer can be called up to rebut it. The Apex Court observed ad infra: “16. Applying the above principle, CW 5616/95 //21// the inevitable conclusion is that the respondent was not entitled to full back wages which according to the High Court was a natural consequence. That part of the High Court order is set aside. When the question of determining the entitlement of a person to back wages is concerned, the employee has to show that he was not gainfully employed. The initial burden is on him. After and if he places materials in that regard, the employer can bring on record materials to rebut the claim. In the instant case, the respondent had neither pleaded nor placed any material in that regard.” In the instant case, it was nowhere pleaded by workman that he was not gainfully employed ; on the contrary, it has been pleaded by petitioner-company in its written statement duly supported by affidavit of its Manager, as taken note of (supra); in such circumstances, in the opinion of this Court, Award of full back wages under the Award impugned is not legally sustainable. The question certainly arises that if order of termination was arbitrary and was in violation of principles of natural justice, ordinarily workman is required to be reinstated in service. However, it has