District Red Cross Society vs Babita Arora & Ors

3. We will give the facts of Civil Writ Petition No.1236 of 2002 which was directed against the award made in Reference No.1433 of 1999. Babita Arora (respondent herein) filed a claim petition before the Presiding Officer, Industrial Tribunal-cum-Labour Court, Karnal, (hereinafter referred to as 'the Tribunal') on the ground, inter alia, that she was appointed as staff nurse in the appellant District Red Cross Society, Karnal, by the order dated 20.3.1992 and she continuously worked on the said post till her services were terminated on 30.9.1998, due to the closing down of the Red Cross Maternity Hospital, but the management had not followed the procedure laid down in Sections 25F to 25H of the Industrial Disputes Act (hereinafter referred to as 'the Act') which was a clear violation of the statutory provisions. The management had also not followed the principle of 'first come last go' while terminating her services and had thereby contravened Section 25G of the Act. No retrenchment compensation was paid to her at the time of termination of her services. The alleged closing down of the Maternity Hospital was only a paper transaction as the Out Patient Department was still functioning and the patients were being given treatment by the doctors as well as other staff. Tubectomy operations were still being conducted in the hospital. Her case further was that there were several other schemes/projects under the appellant, like, Family Welfare Scheme, Drug De-addiction-cum-Research Centre, etc., where the respondent could be absorbed. It was accordingly prayed that an award may be passed directing the appellant to reinstate her in service with continuity of service and full back wages.

4. The appellant District Red Cross Society, Karnal, filed written statement on the ground, inter alia, that claim petition was not maintainable as the hospitals and social organizations were not covered under the Industrial Disputes Act. The services of the respondent were terminated on account of closing down of the Red Cross Maternity Hospital w.e.f. 30.9.1998 as the hospital was being run on donations and not on government grant. The donations had considerably reduced and due to financial constraints and heavy expenditure, the appellant had no option but to close the maternity hospital. It was further pleaded that on account of closure of the charitable Maternity Hospital, the services of the entire staff working therein had been terminated and no one was retained in service. The respondent was, however, offered a post in another organization, viz., Drug De-Addiction-cum-Rehabilitation Centre, Karnal, wherein a post of nurse was sanctioned by the Government on 2.11.1998, but the respondent refused to accept the said offer.

5. The parties adduced oral and documentary evidence in support of their case. The appellant employer examined Brahm Dutt, Clerk, incharge of the District Red Cross Society, Karnal, who stated that the management carried on social work and the same was done on charitable basis from the donations received from public. The appellant Society was also running a Drug De-Addiction-cum- Rehabilitation Centre, a Family Planning Centre and a Viklang Kendra, which were being run as separate establishments as they were receiving grants from the Government to the extent of 90% to 100%. A decision was taken in a meeting held on 4.9.1998 to close down the Maternity Hospital on account of extreme financial stringency as it was not receiving any aid from the Government and was being run entirely from donations. In the said meeting Civil Surgeon, Karnal, had suggested that all the facilities of a Maternity Hospital were available in the Civil Hospital which was nearby and the hospital being run by the Red Cross Society was not serving any useful purpose. He also stated that the respondent had been offered service in Drug De-Addiction-cum-Research Centre but she refused the said offer.

6. The Tribunal held that the appellant Society was running a Drug De-Addiction-cum-Rehabilitation Centre, a Family Planning Centre and a Viklang Kendra and thus it cannot be said that the establishment of the appellant had been closed. It was further held that the respondent had completed more than 240 days of service in the year preceding the date of termination of her service and, therefore, she was entitled to reinstatement compensation which had not been given by the management and thus termination of her service was in violation of Section 25F of the Act. It was also held that persons junior to the respondent were working in the aforesaid other centres of the appellant and thus the termination of her service was in clear violation of Section 25G of the Act. On these findings, the Tribunal held that the termination of service of the respondent was illegal and contrary to law and accordingly gave an award directing her reinstatement with continuity of service and full back wages from the date of demand notice i.e. 6.11.1998. Similar awards were given in the three other adjudication cases and orders for reinstatement with continuity of service and full back wages were passed in favour of the concerned employees (respondents herein). The appellant challenged the awards of the Tribunal by filing four writ petitions in the High Court. The High Court held that from the evidence on record it could be safely concluded that the appellant Red Cross Society was running other projects like Drug De-Addiction-cum-Rehabilitation Centre, Family Planning Centre and Viklang Kendra and they had not been closed. The Red Cross Society, Karnal, itself had not ceased to exist and its other units were functioning. It was further held that in a case where other units which are under the same management are functioning and the Red Cross Society was receiving grants from the Government, the termination of the services of the respondents was clearly illegal. On these findings, the writ petitions were dismissed.

10. In view of the findings recorded above, the respondent would be entitled to compensation only in accordance with Section 25FFF of the Act and the award for reinstatement in service with back wages passed by the Tribunal which was affirmed by the High Court cannot be sustained and must be set aside.

11. The cases of other three respondents are exactly identical to that of Babita Arora as they were all working in the Maternity Hospital. Therefore, the awards passed by the Tribunal directing their reinstatement in service and back wages have to be set aside.

12. In the result, the appeals succeed and are hereby allowed. The judgment and order dated 24.10.2002 of the High Court and the awards dated 7.9.2001 of the Tribunal are set aside. The appellant shall pay the compensation to the respondents in accordance with Section 25FFF of the Act within two months from today, failing which it will be open to the respondents to approach the Tribunal for computation of the amount. No costs.