NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 4370 OF 2015
(Arising Out of SLP (C) No. 29960 of 2014)
RAJ KUMAR DIXIT …APPELLANT
Vs.
M/S.VIJAY KUMAR GAURI SHANKER,
KANPUR NAGAR …RESPONDENT
J U D G M E N T
V. GOPALA GOWDA, J.
Leave granted.
This appeal is directed against the impugned final judgment and order
dated 02.07.2014 passed by the High Court of Judicature at Allahabad, in
Writ Petition No.19573 of 2010, whereby the High Court quashed the judgment
and order of the Labour Court, Kanpur, in Adjudication Case No.66 of 2009
dated 03.07.2009, wherein the Labour Court directed the reinstatement of
the appellant-workman in his post along with 50% back wages. The High Court
modified the Award by granting compensation of Rs. 2 lakhs to be paid to
the appellant-workman in place of the Award passed by the Labour Court.
The factual matrix and the rival legal contentions urged on behalf of the
parties are briefly stated hereunder with a view to find out whether the
impugned judgment and order of the High Court warrants interference by this
Court in exercise of its appellate jurisdiction and for what relief the
appellant is entitled to?
M/s.Vijay Kumar Gauri Shanker, the respondent-firm herein, was carrying
on the business of transporting caustic soda from M/s.Modi Alkalies and
Chemicals Ltd. in Alwar, Rajasthan. For the said purpose, the respondent-
firm was in possession of seven tankers which were used for transporting
caustic soda from Alwar to the place of supply.
It is the case of the appellant that he was working as an accounts clerk
in the respondent-establishment from the year 1994 and was looking after
all the factories of the respondent-establishment. Apart from that he was
in charge of maintenance of all the seven tankers in the respondent-
establishment and was also looking after the transport office and court
work of the respondent-employer and in return he was being paid Rs.1,800/-
per month along with bonus as was being paid to other workmen of the
respondent-establishment.
On 11.6.2001, when the appellant who had fallen sick approached the
respondent-firm for his outstanding salary, the respondent-firm terminated
him from his services. However, the workmen who were junior to him were
still working in the respondent-establishment. The appellant-workman
requested for reinstatement of his services in his post but the respondent-
establishment refused the same which action amounts to retrenchment as they
have done so without following the mandatory conditions as provided under
Section 6N of the Uttar Pradesh Industrial Disputes Act, 1947 (hereinafter,
“the Act”). Aggrieved by the order of termination, the appellant raised an
industrial dispute before the Labour Court, Kanpur narrating all the
relevant facts and grounds in support of his claim.
The Labour Court on the basis of the pleadings of the parties and
in accordance with the claim and written statements of the appellant and
the respondent and on re-appreciation of the evidence on record adjudicated
the existing industrial dispute between the parties and recorded its
finding on the points of dispute referred to it in favour of the appellant
which are extracted in the narration of the facts and based on the evidence
and circumstances of the case, it held that the appellant was under the
employment of the respondent-firm and terminating him from his services by
the respondent-firm is in contravention to the provisions of Section 6N and
other provisions of the Act which is improper and illegal. The Labour Court
directed the respondent-firm to reinstate him in the said post and pay him
50% back wages from the date of termination till the date of passing of the
Award.
The correctness of the said Award was challenged by the respondent-
establishment before the High Court by filing writ petition urging various
legal grounds. The High Court, based on the findings and reasons recorded
on the points of dispute, held that the termination order passed against
the appellant-workman is not legal. The High Court in exercise of its
judicial review power under Article 227 of the Constitution of India
modified the Award passed by the Labour Court, holding that the workman has
neither stated anything with regard to his gainful employment nor any
averments were made by him in this regard during the aforesaid period.
Therefore, awarding 50% back wages in favour of the workman by the Labour
Court in its Award is held to be not justified and the High Court modified
the Award by awarding Rs.2 lakhs compensation in lieu of reinstatement with
50% back wages as awarded by the Labour Court.
The appellant-workman aggrieved by the judgment and order of the High
Court has filed this appeal by special leave, urging various legal grounds
in support of his claim and prayed this Court to set aside the impugned
judgment and order of the High Court and restore the Award and further
direct the respondent to reinstate him in his post and pay him full back
wages from the date of the Award passed by the Labour Court.
It has been contended by the learned counsel on behalf of the appellant-
workman that the services of the workman have been terminated without
complying with the mandatory provisions of Section 6N of the Act. His
juniors are still continuing in the employment of the respondent-
establishment while his services were arbitrarily terminated which is
contrary to the law laid down by this Court in a catena of cases. The
learned counsel has further contended that the respondent-firm has
erroneously claimed that the appellant-workman is not an employee of the
firm as he was carrying out the work of advocacy in the courts on its
behalf whenever the tankers of the respondent-firm met with an accident. It
has been further contended by him that the maintenance of the tankers was
done by the appellant-workman in the capacity of the employee of the
respondent-firm as the said work could be carried out by an employee of the
respondent-firm only. It has been further contended by the learned counsel
on behalf of the appellant-workman that the High Court has erred in its
decision in holding that the reinstatement of the appellant-workman was
unjustified since the respondent-firm has closed down its business. The
High Court has further erred in its decision in holding that the Labour
Court was not justified in passing an Award of reinstatement of the workman
in his post with 50% back wages as the Labour Court in another case
involving the driver working at the establishment of the respondent-firm
has not ordered his reinstatement which fact of the case could not have
applied to the fact situation of the present case as only the transport
business of the respondent-firm has closed down and its other businesses
are still continuing and the appellant-workman was working in the capacity
of an accounts clerk of the respondent-firm which does not disqualify him
from reinstatement in his post.
On the other hand, it has been contended by the learned counsel on behalf
of the respondent-firm that the appellant-workman has not placed any
evidence on record, either oral or documentary to the effect that he was an
accounts clerk employed in the respondent-firm and as such there is no
master-servant relationship between him and the respondent-firm. Hence, the
provisions of Section 6N of the Act are not applicable to the fact
situation of the present case. It has been further submitted by him that
the management of the respondent-firm gave special power of Attorney to the
appellant-workman for the purpose of getting the tankers released from the
custody of the police or the court and he has worked in that capacity only
and nothing more. For the said work the respondent-firm used to give him
fee for all the necessary expenses that he would incur with regard to the
release of the tankers of the respondent-firm from the custody of the
police or the court.
It has been further contended by the learned counsel that since M/s. Modi
Alkalies and Chemicals Ltd. has been closed down in the year 2000 and the
work of transporting caustic soda from the said factory was completely
stopped, therefore, the tankers of the respondent-firm were sold off and
all the licenses of the tankers were surrendered to the respective
authority. Hence, the Labour Court has erred in directing the respondent-
firm to reinstate the workman with 50% back wages and the same has been
rightly quashed by the High Court and modified the Award by awarding Rs.2
lakhs towards compensation in lieu of reinstatement and back wages awarded
by the Labour Court.
We have heard both the learned counsel on behalf of the parties. On the
basis of the aforesaid rival legal contentions urged on behalf of the
parties and on perusal of the findings recorded by the Labour Court in its
Award, we have to answer the points of dispute on the basis of evidence
produced on record. We are of the view that the conclusion arrived at by
the High Court is erroneous in law in holding that the appellant workman
was not in employment under the respondent-firm and it has erroneously
quashed the Award of reinstatement of the appellant-workman passed by the
Labour Court along with 50% back wages. In support of the above said
conclusion arrived at by us, we record our reasons hereunder:-
It is an admitted fact that the respondent-firm used to authorise the
appellant-workman on its behalf to do the work of releasing of the tankers
of the respondent-firm from the custody of police or the court whenever the
tankers met with an accident and a special power of Attorney was executed
by the respondent-firm in this regard to the appellant-workman. Further,
the respondent-firm also used to give him advance amount for the expenses
that he would incur for carrying out the said work. The appellant-workman
was also given bonus every year and the same has been recorded in the cash-
book of the respondent-firm. The fact that the respondent-firm is still
continuing with its business of trading betel nut and the new plea that the
transport business of the respondent-firm has been shut down has also been
considered by us. The question that arises for our consideration in this
case, keeping in view the relevant facts, circumstances and the evidence on
record is that whether the appellant-workman was gainfully employed in the
capacity of the clerk in the establishment of the respondent firm or not.
The same is answered by the Labour Court in the positive, on the basis of
the evidence on record in favour of the appellant for the reason that one
would not simply authorize a person who is not even an employee of its
establishment for carrying on with the work of getting the tankers released
from the custody of the police or the court. Further, the bonus received by
the workman is only given in the case where he would be employed in the
establishment of the respondent-firm. Thus, the contention of the learned
counsel on behalf of the respondent-firm that the appellant-workman is not
the employee of the respondent-firm and there is no master-servant
relationship between them, was rightly rejected by the Labour Court by
recording its reasons and holding that the concerned workman was employed
in the establishment of the respondent-firm. Further, the payment of labour
charges for the repair of the tankers was given to the workman through bill
or voucher separately, instead of it being mentioned directly in the
invoices of the repair of the tankers, which evidence was produced by him
before the Labour Court, the same is rightly accepted by it on proper
appreciation in exercise of its original jurisdiction.
Further, various records such as court orders or the report given at the
police station were placed on record before the Labour Court which would
clearly show that the appellant-workman worked in the capacity of
Munim/Clerk/Manager in the establishment of the respondent-firm. Even the
power of Attorney executed by the respondent-firm clearly states that the
appellant-workman was authorised to carry out whatever action necessary in
connection with the release of the tankers of the respondent-firm either
from the police custody or the court. Thus, it is clear from the above
evidence produced on record by the appellant before the Labour Court that
he has worked in the capacity of not only a mechanic in the establishment
of the respondent-firm but also as an accounts clerk. The witnesses on
behalf of the respondent-firm had further deposed before the Labour Court
that the appellant-workman used to carry out the repair work of the tankers
of the respondent-establishment on a regular basis and the said work was
done by the appellant-workman only. Therefore, in the light of the facts
and circumstances of the case and the evidence admitted on record before
the Labour Court and produced before this Court, it is amply clear that the
appellant-workman was employed in the establishment of the respondent-firm
and he used to carry out the business of the respondent-firm in the
capacity of an employee/clerk and not just a third party agent or a
mechanic. Therefore, the High Court has gravely erred in quashing the Award
of reinstatement of the appellant-workman with 50% back wages in the
establishment of the respondent-firm by awarding a compensation of Rs.2
Lakhs in lieu of the same which modification of the Award of the Labour
Court is not only erroneous but also suffers from error in law and
therefore, the same is liable to be quashed by this Court.
Awarding compensation to an amount of Rs. 2 lakhs to the workman by the
High Court in lieu of reinstatement of the appellant-workman along with 50%
back wages is once again contrary to the well settled principles of law as
has been laid down by this Court in a catena of cases, particularly, the
case of Punjab Land Development and Reclamation Corporation. Ltd. v.
Presiding Officer, Labour Court,[1] wherein the Constitution Bench held
that the order of termination simpliciter has to be held bad in law for non-
compliance of the mandatory requirements provided under the Act and further
held that the order of termination will be rendered void-ab-initio in law
and therefore, the workman is entitled for all benefits for which he is
legally entitled to in law.
The High Court has exceeded in its jurisdiction in setting aside the Award
passed by the Labour Court in awarding reinstatement of the appellant-
workman in his post along with 50% back wages which is erroneous in law as
the High Court has not noticed the fact that the appropriate Government has
referred the dispute to the Labour Court for its adjudication on the points
of dispute referred to it. Since, there was non-compliance of the mandatory
requirements as provided under the provisions of the Act by the respondent-
firm at the time of passing an order of termination against the appellant-
workman, therefore, the same has been held to be bad in law and as such it
should have awarded full back wages to the workman from the date of
termination till the date of passing the Award unless the employer proves
that the workman was gainfully employed during the aforesaid period which
fact is neither pleaded nor proved before the Labour Court.
Therefore, the impugned judgment of the High Court is bad in law as the
normal rule to be followed by the respondent-firm with regard to the
termination of the services of the workman has not been done in the present
case and further, the High Court has once again exceeded in its supervisory
jurisdiction in exercise of its judicial review power under Article 227 of
the Constitution of India by setting aside the Award of reinstatement with
50% back wages passed by the Labour Court and has instead awarded Rs.2
lakhs as compensation to the appellant-workman which is contrary to the law
laid down by this Court. The High Court cannot exercise its supervisory
jurisdiction and act as either original court or appellate court to set
aside the finding of fact recorded on the points of dispute referred to the
Labour Court on proper appreciation of pleadings and evidence on record in
favour of the workman as has been done in the instant case. The Award of
compensation of Rs.2 Lakhs awarded in place of reinstatement with 50% back
wages as awarded by the Labour Court has been modified by the High Court
without assigning any cogent and valid reason which is not only erroneous
in law but suffers from error in law as well, as the same is contrary to
the catena of decisions of this Court. On this ground itself, the impugned
judgment of the High Court is liable to be set aside and we pass an order
to restore the Award passed by the Labour Court. Reliance has been placed
in the case of Syed Yakoob v. K.S. Radhakrishan[2] which has been
elaborately considered by this Court in the case of Harjinder Singh v.
Punjab State Warehousing Corporation[3], the relevant para of which reads
thus:
“12. In Syed Yakoob case, this Court delineated the scope of the writ of
certiorari in the following words:
“7. The question about the limits of the jurisdiction of High Courts in
issuing a writ of certiorari under Article 226 has been frequently
considered by this Court and the true legal position in that behalf is no
[pic]longer in doubt. A writ of certiorari can be issued for correcting
errors of jurisdiction committed by inferior courts or tribunals: these are
cases where orders are passed by inferior courts or tribunals without
jurisdiction, or is in excess of it, or as a result of failure to exercise
jurisdiction. A writ can similarly be issued where in exercise of
jurisdiction conferred on it, the court or tribunal acts illegally or
improperly, as for instance, it decides a question without giving an
opportunity to be heard to the party affected by the order, or where the
procedure adopted in dealing with the dispute is opposed to principles of
natural justice. There is, however, no doubt that the jurisdiction to issue
a writ of certiorari is a supervisory jurisdiction and the court exercising
it is not entitled to act as an appellate court. This limitation
necessarily means that findings of fact reached by the inferior court or
tribunal as result of the appreciation of evidence cannot be reopened or
questioned in writ proceedings. An error of law which is apparent on the
face of the record can be corrected by a writ, but not an error of fact,
however grave it may appear to be. In regard to a finding of fact recorded
by the tribunal, a writ of certiorari can be issued if it is shown that in
recording the said finding, the tribunal had erroneously refused to admit
admissible and material evidence, or had erroneously admitted inadmissible
evidence which has influenced the impugned finding. Similarly, if a finding
of fact is based on no evidence, that would be regarded as an error of law
which can be corrected by a writ of certiorari. In dealing with this
category of cases, however, we must always bear in mind that a finding of
fact recorded by the tribunal cannot be challenged in proceedings for a
writ of certiorari on the ground that the relevant and material evidence
adduced before the tribunal was insufficient or inadequate to sustain the
impugned finding. The adequacy or sufficiency of evidence led on a point
and the inference of fact to be drawn from the said finding are within the
exclusive jurisdiction of the tribunal, and the said points cannot be
agitated before a writ court. It is within these limits that the
jurisdiction conferred on the High Courts under Article 226 to issue a writ
of certiorari can be legitimately exercised (vide Hari Vishnu Kamath v.
Ahmad Ishaque, Nagendra Nath Bora v. Commr. of Hills Division and Kaushalya
Devi v. Bachittar Singh).
8. It is, of course, not easy to define or adequately describe what an
error of law apparent on the face of the record means. What can be
corrected by a writ has to be an error of law; but it must be such an error
of law as can be regarded as one which is apparent on the face of the
record. Where it is manifest or clear that the conclusion of law recorded
by an inferior court or tribunal is based on an obvious misinterpretation
of the relevant statutory provision, or sometimes in ignorance of it, or
may be, even in disregard of it, or is expressly founded on reasons which
[pic]are wrong in law, the said conclusion can be corrected by a writ of
certiorari. In all these cases, the impugned conclusion should be so
plainly inconsistent with the relevant statutory provision that no
difficulty is experienced by the High Court in holding that the said error
of law is apparent on the face of the record. It may also be that in some
cases, the impugned error of law may not be obvious or patent on the face
of the record as such and the court may need an argument to discover the
said error; but there can be no doubt that what can be corrected by a writ
of certiorari is an error of law and the said error must, on the whole, be
of such a character as would satisfy the test that it is an error of law
apparent on the face of the record. If a statutory provision is reasonably
capable of two constructions and one construction has been adopted by the
inferior court or tribunal, its conclusion may not necessarily or always be
open to correction by a writ of certiorari. In our opinion, it is neither
possible nor desirable to attempt either to define or to describe
adequately all cases of errors which can be appropriately described as
errors of law apparent on the face of the record. Whether or not an
impugned error is an error of law and an error of law which is apparent on
the face of the record, must always depend upon the facts and circumstances
of each case and upon the nature and scope of the legal provision which is
alleged to have been misconstrued or contravened.””
The findings and reasons recorded by the High Court in its judgment and
setting aside the award of the Labour Court is contrary to the decision of
this Court. Further, in the case of Deepali Gundu Surwase v. Kranti Junior
Adhyapak Mahavidyalaya[4], this Court, after adverting to the three Judge
Bench judgment of this Court in the case of Surendra Kumar Verma v. Central
Govt. Industrial Tribunal-cum-Labour Court[5], has categorically held that
the termination order passed by the employer is the subject matter of
dispute either before the Tribunal or before the Labour Court and it is for
the employer to show that the workman was gainfully employed from the date
of the termination till the date of passing of the Award so as to deny him
back wages and this Court further held that if the termination order is set
aside, the award of reinstatement is the normal rule and awarding of the
back wages must follow, the same need not be awarded if the workman is
either gainfully employed during the period of adjudication or if the
employer is facing any financial crunch. The said decision of this Court in
the Deepali Gundu Surwase’s case reads thus:
“24. Another three-Judge Bench considered the same issue in Surendra Kumar
Verma v. Central Govt. Industrial Tribunal-cum-Labour Court and observed:
“6. … Plain common sense dictates that the removal of an order terminating
the services of workmen must ordinarily lead to the reinstatement of the
services of the workmen. It is as if the order has never been, and so it
must ordinarily lead to back wages too. But there may be exceptional
circumstances which make it impossible or wholly inequitable vis-à-vis the
employer and workmen to direct reinstatement with full back wages. For
instance, the industry might have closed down or might be in severe
financial doldrums; the workmen concerned might [pic]have secured better or
other employment elsewhere and so on. In such situations, there is a
vestige of discretion left in the court to make appropriate consequential
orders. The court may deny the relief of reinstatement where reinstatement
is impossible because the industry has closed down. The court may deny the
relief of award of full back wages where that would place an impossible
burden on the employer. In such and other exceptional cases the court may
mould the relief, but, ordinarily the relief to be awarded must be
reinstatement with full back wages. That relief must be awarded where no
special impediment in the way of awarding the relief is clearly shown.
True, occasional hardship may be caused to an employer but we must remember
that, more often than not, comparatively far greater hardship is certain to
be caused to the workmen if the relief is denied than to the employer if
the relief is granted.”
The contention urged on behalf of the respondent-firm that the Award of
compensation of Rs.2 Lakhs in lieu of the reinstatement and 50% back wages
by the High Court is on account of the alleged closure of the respondent
establishment is neither supported by any pleading nor any evidence has
been adduced before the Labour Court or this Court in that regard by the
respondent-establishment. If any additional material is produced before the
High Court, the same would be impermissible in law for the reason that the
respondent-employer was required to plead with regard to the alleged
closure and substantial evidence must be produced in support of the same
before the Labour Court at the first instance, and no such plea has been
taken before the Labour Court by them. In absence of such a plea, producing
additional documents by the respondent-establishment before the High Court
is totally impermissible in law for the reason that the High Court’s
jurisdiction is to examine the correctness of the Award passed by the
Labour Court in exercise of its judicial review power under Article 227 of
the Constitution of India which is very limited. In the present case, even
if we consider the facts, there is no additional material evidence produced
on record before the High Court and it has no jurisdiction to receive the
same and render its findings. Apart from the said reason no other reason
has been assigned by the High Court in its judgment and order for modifying
the Award passed by the Labour Court. Therefore, the legal contention urged
in this regard on behalf of the respondent-establishment is misconceived
and the same is liable to be rejected.
The High Court has erred in its decision, both on facts and in law in
setting aside the order of reinstatement with 50% back wages to the
workman. It is the workman who was aggrieved with regard to the non-
awarding of 50% back wages and this aspect of the matter has not been
considered by the High Court while interfering with the Award of the Labour
Court and awarding compensation in lieu of the reinstatement and back
wages. Therefore, the appeal must succeed in this case. The High Court in
awarding compensation to the workman has erroneously held that the order of
reinstatement passed in favour of the appellant-workman is illegal and void
ab initio in law without assigning valid and cogent reasons and therefore,
the same is liable to be set aside as there has been a miscarriage of
justice. The grounds urged by the appellant in this case are well founded
and we accordingly pass the following order:
The Appeal is allowed. The impugned judgment and order passed by the High
Court of Judicature at Allahabad in Writ Petition No. 19573 of 2010 dated
02.07.2014 is hereby set aside and the Award passed by the Labour Court in
awarding reinstatement with 50% back wages from the date of termination
till the date of passing the Award by the Labour Court is restore We further direct the respondent-firm to pay full back wages to the workma from the date of passing of the Award by the Labour Court till the date of his reinstatement in service. The order shall be complied with by th respondent-firm within six weeks from the date of receipt of copy of this
order.
……………………………………………………………………………………J.
[FAKKIR MOHAMED IBRAHIM KALIFULLA]
……………………………………………………………………………………J.
[V. GOPALA GOWDA]
New Delhi,
May 12, 2015
-----------------------
[1]
(1990) 3 SCC 682
[2] (1964) AIR SC 477
[3] (2010) 3 SCC 192
[4] (2013) 10 SCC 324
[5] (1980) 4 SCC 443