Full Judgment Text
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CASE NO.:
Appeal (civil) 1839 of 2005
PETITIONER:
Muir Mills Unit of N.T.C. (U.P) Ltd.
RESPONDENT:
Swayam Prakash Srivastava & Anr.
DATE OF JUDGMENT: 01/12/2006
BENCH:
Dr. AR. Lakshmanan & Altamas Kabir
JUDGMENT:
JUDGMENT
Dr. AR.Lakshmanan, J.
The appellant in the present matter is Muir Mills a
subsidiary of the National Textile Corporation Ltd. of
State of Uttar Pradesh. The respondent No.1 was offered
appointment as Legal Assistant in the litigation section
on a probation period of 1 year (in the pay scale of Rs.
330-560) on 04.06.1982. The appointment letter stated
that the said appointment was on a probationary basis.
The period of probation was set at one year from the date
of joining. On 12.06.1982, the respondent No.1 joined his
duties.
On 23.11.1982, a letter was written by the Senior
Legal Assistant to the General Manager of the Mill stating
that respondent No.1 had completed 6 months of
probation but was not able to understand fully the work
of his post and stated that "His work is not up to the
mark; therefore he is of no use to us". However, it was
decided to give the respondent No.1 an opportunity to
improve his performance. It is the case of the appellants
that the respondent No.1 was orally informed about the
above decision of the appellants.
On the expiry of the probation period of the
respondent No.1, a letter dated 04.06.1983 was issued to
the respondent No.1 stating that, "Your performance has
not been found satisfactory and as such, you have failed
to complete the probationary period successfully".
On 06.02.1985, respondent No.1 raised an industrial
dispute which was referred for adjudication by
respondent No.2 the State of Uttar Pradesh, to the
Labour Court in the following terms, "Is termination of
the services of the workman Swayam Prakash Srivastava
(son of Hori Lal Srivastava), Legal Assistant by the
employers vide their order dated 04.06.1983 is right
and/or legal? If not, the concerned workman is entitled
to which benefit/relief and along with which other
details."
On 25.05.1987, the Labour Court delivered an
award holding that, the respondent No.1 was a workman
and the termination was illegal and that respondent No.1
has to be reinstated within a month of the order with
backwages. The Labour court also observed that the
Industrial adjudicator had no power to examine the
validity of the termination of the services of a probationer
before the completion of probation period.
Aggrieved by this order of the Labour Court, the
appellant preferred a writ petition being WP No.22193
before the High Court of Judicature, Allahabad
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challenging the award of the Labour Court dated
25.05.1987. By an interim order dated 02.12.1987, the
High Court stayed the operation of the award of the
Labour Court subject to the deposit of one half of the
decreed backwages. The appellant was also directed to
continue to make payment of the future salary of
respondent No.1 till further orders. The respondent No.1
was given the liberty to withdraw the backwages upon
furnishing security. The future salary be withdrawn by
respondent No.1 without any security. The appellants
complied with the order of the High Court immediately.
Muir Mills ceased to be operational in 1991. In the
period 1992-1993, the appellants referred to the Board of
Industrial and Financial Reconstruction (’BIFR’) under
the Sick Industrial Companies (Special Provisions) Act
(’SICA’). On 05.02.2002 the National Textile Corporation
(UP) Ltd, of which the appellants is a constituent entity
was declared as a sick industrial company under the
SICA and 9 of the 11 mills owned by the said company
was directed to be closed.
On 01.11.2002, the High Court dismissed the writ
petition No.22193 of 1987 holding that the High Court
will not interfere with the order of the Labour court as
the same has neither been shown to be perverse, nor
suffering from any error of law.
By letter dated 9/11.03.2004, the Ministry of
Labour, Government of India approved the formal closure
of Muir Mills.
However, on 20.04.2004, the appellant company
received a show cause notice from the Deputy Labour
Commissioner asking the appellant to explain why a
recovery certificate of over ten lakhs be not issued in
favour of respondent No.1.
An SLP was filed by the appellant on 16.07.2004
challenging the order of the High Court dated
01.11.2002.
The issues that deserve to be settled by this court
according to us are:
1. Whether ’legal assistant’ falls under the
definition of workman under the Industrial
Disputes Act?
2. Whether the High Court failed to appreciate that
the award was perverse inasmuch as it directed
the reinstatement with backwages of a
probationer whose services had been
discontinued upon completion of the
probationary period on account of
unsatisfactory work?
3. Whether the High Court failed to appreciate that
respondent No.1 having worked as a probationer
for just a year had enjoyed over 15 years of
wages without having worked for the same and
that in the facts and circumstances even if the
termination was held to be illegal, these wages
paid should have been held to be treated as
compensation in lieu of reinstatement?
The appellant Mill was represented before us by
learned counsel Mr.Sanjay Ghose, assisted by Ms. Anitha
Shenoy, advocate. Mr. Bharat Sangal, learned counsel
appeared for the respondents.
The appellants stated that respondent No.1 was not
a workman as understood under the Industrial Disputes
Act. The respondent No.1 was being paid a sum of
Rs. 866.51 as salary and his work was essentially of
supervisory nature. The nature of respondent No.1, Mr.
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Swayam Prakash Srivastava’s work was to supervise the
court cases and conduct them in the courts for the
appellant Mill.
It was submitted on behalf of the appellants that
the High Court failed to appreciate that the award of the
Labour Court was perverse as it directed the
reinstatement with backwages of a probationer whose
services had been discontinued upon completion of the
probationary period on account of unsatisfactory work. In
this regard the learned counsel referred to this Court’s
decision in the case of Pavanendra. Narayan. Verma
vs. Sanjay Gandhi PGI of Medical Studies & Anr
(2002) 1 SCC 520, where it was held that the services of
a probationer can be terminated at any time before
confirmation, provided that such termination is not
stigmatic.
Learned counsel submitted that the High Court
failed to appreciate that the award of the Labour Court
was also perverse as it had directed grant of backwages
without giving any finding on the gainful employment of
respondent No.1 and held that the discontinuance of the
services of a probationer was illegal without giving any
finding to the effect that the disengagement of respondent
No.1 was in any manner stigmatic. The decision in the
case of MP State Electricity Board vs. Jarina Bee
(Smt) (2003) 6 SCC 141 was cited in this regard where it
was held that payment of full back wages was not the
natural consequence of setting aside an order of
reinstatement. In the instant case, though the
termination was as far back as in 1983, the Industrial
Adjudicator has not given any finding on unemployment.
It was submitted that the respondent No.1 had been
receiving interim wages for over 15 years without having
worked at all and without having established his
unemployment. The High Court failed to appreciate that
the award itself had only granted reinstatement to
respondent No.1 as a probationer giving the petitioner
the right to take a decision on confirmation.
The High Court failed to appreciate that respondent
No.1 having worked as a probationer for just a year had
enjoyed over 15 years of wages without having worked for
the same and that in the facts and circumstances even if
the termination was held to be illegal, these wages paid
should have been held to be treated as compensation in
lieu of reinstatement.
The appellants further contended that, assuming
but not conceding that the termination of the service of
respondent No.1 was illegal, given the fact that all that
the Labour Court directed was that the respondent be
reinstated as a probationer and given the fact that the
Mill itself had been closed down and the appellant
declared a Sick Industrial Company in respect of which a
revival scheme was sanctioned, the decision of this court
in Rolston John vs. Central Government Industrial
Tribunal-cum-Labour Court & Ors., 1995 Suppl (4)
SCC 549 would be applicable and the logical relief would
be to be compensated in lieu of reinstatement, which in
the given case could be deemed to set off and satisfied by
the payment received by respondent No.1 of wages
pursuant to the interim order of the High Court dated
02.12.1987.
It was further submitted that the huge financial
liability of Rs.7 lakhs in wages to a probationer who had
worked for only about a year was something which the
appellant, being a Sick Industrial Company, would find
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impossible to bear and if this liability is saddled upon the
appellant, it could prejudice the sanctioned scheme for
revival of two remaining mills. Almost 6898 employees
have been retired under a voluntary retirement scheme.
That the High Court erred in dismissing the writ
petition of the appellant on the ground that the appellant
had not complied with the interim order of the High
Court whereas the appellant mill has complied with order
dated 2.12.1987 for payment of half of the decreed
backwages as early as on 19.1.1988.
Concluding his arguments the learned counsel
submitted that, the NTC (UP) Ltd. was managing 11
nationalised textile mills in the State of Uttar Pradesh.
On account of huge losses, obsolete technology, excess
labour/staff force the company was referred to the Board
for Industrial and Financial Reconstruction (BIFR) under
the Sick Industrial Companies (Special Provisions) Act in
the year 1992-1993. The IFCI has prepared a Revival
Scheme on the basis of which the BIFR has approved of a
sanctioned scheme. Under the Scheme, 9 of the 11 mills,
including the Muir Mills where respondent No.1 had
served as a probationer, have been closed down. About
6898 employees have opted for VRS. The High Court
failed to appreciate that the petitioner-Company itself
had been declared a Sick Industrial Company and the
Muir Mills wherein the respondent worked had been
closed down and the reinstatement in any event was an
impossibility.
That the claim had been raised by the respondent, a
probationer who had served for only one year and who
has already received wages for over 15 years amounting
to Rs.2.5 lakhs despite no entitlement to the same under
law and without any proof of unemployment during this
period. If a recovery certificate of over Rs. 10 lakhs is
allowed to be issued in favour of respondent No.1 then
the appellant already staggering under a huge financial
liability which the appellant, being a Sick Industrial
Company would find impossible to bear and if this
liability is saddled upon the appellant, it could seriously
prejudice the sanctioned scheme for revival of two
remaining mills affecting the future of about 3000
employees who have been labouring day and night in the
remaining mills to make the Revival Scheme a success.
The respondents submitted that the respondent
No.1 was appointed as Legal Assistant in the appellant’s
organization where he worked with full devotion, sincerity
and to the full satisfaction of the employers but his
services were terminated on 04.06.1983 without any
reason. It was submitted that, respondent No.1 was on
leave on 04.06.1983 and 05.06.1983 (being a Sunday)
and on 06.06.1983 when he went for work he was given
the termination order. Respondent No.1 was not issued
a charge sheet or notice during the period before the
termination of his services.
It was contended that respondent No.1 was
appointed as legal assistant but he was not doing any
work of supervisory nature and that no body was working
under him. Further it was contended that respondent
No.1 used to do parokari on behalf of the Mills and that
this type of work cannot be called as work of supervisory
nature and therefore respondent No.1 will qualify to be
workman as defined under section 2(z) of the U.P.
Industrial Disputes Act (U.P.I.D Act), 1947.
It was stated that the termination order comes
under the definition or retrenchment and the employers
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have not followed the legal process. The workman has
stated that the termination order comes under the
definition of retrenchment under section 2 of the
U.P.Industrial Disputes Act. The definition of
retrenchment is very elaborate in this section and in this
connection a decision of this court was cited, Karnataka
State Road Transport Corporation, Bangalore vs.
Abdul Qadir which appears on page 89 F.L.R. \026 1984-
48, where it was observed that, "To protect the weak
against the strong this policy of comprehensive definition
has been effectuated. Termination embraces not merely
the act of termination by the employer but the fact of
termination howsoever produced. We are inclined to hold
that the stage has come when the view indicated in
Money’s case has been ’absorbed into the consensus’ and
there is no scope for putting the clock back or for an
anticlockwise operation. Once the conclusion is reached
that retrenchment as defined in section 2(oo) of the
Industrial Disputes Act covers every case of termination
of service except those which have been embodied in the
definition, discharge from employment or termination of
service of a probationer would also amount to
termination."
It was also contended that there was no evidence
whatsoever to prove that the workman (respondent No.1)
was given any warning during the period of his service for
his unsatisfactory work and therefore terminating his
services without a reasonable notice is wrong under law.
The respondents further contended that in the
present fact scenario retrenchment is bad under law as
conditions under section 6-N is not complied with.
Section 6-N of the U.P. Industrial Disputes Act, 1947,
states that,
"No workman 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 workman has been paid in
lieu of such notice wages for the period of
notice:
Provided that\005.,
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 service or any part
thereof in excess of six months\005"
Therefore, it was submitted that backwages have to
be paid to the retrenched workman. The learned counsel
cited a string of cases in support of this contention made
before us, Surendra Kumar Verma Etc vs. Central
Government Industrial Tribunal-cum- Labour Court,
New Delhi & Anr., 1981 (1) SCR 789, Hindustan Tin
Works Pvt. Ltd. vs. Employees of Hindustan Tin
Works Pvt. Ltd., 1979 (1) SCR 563, Mohan Lal vs.
Mgmt of M/s. Bharat Electronics Ltd, (1981) 3 SCC
225, Post Graduate Institute of Medical Education
and Research, Chandigarh vs. Vinod Krishan
Sharma & Anr (2001) 2 SCC 59, J.N.Srivastava vs.
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Union of India 1998(9) SCC 559 and Jitendra Singh
Rathor vs. Shri Baidyanath Ayurved Bahwan Ltd &
Anr., 1984 3 SCR 223 where this court has consistently
held that in case of illegal termination of service of a
workman, the workman is deemed to be continuing in
service and is entitled to reinstatement with full
backwages.
We heard the parties in detail and have perused
through all the written records placed before us. We are
of the opinion that the arguments of the appellant merits
favourable consideration for the reasons stated infra.
With regard to the question, whether respondent
No.1 is a ’workman’ under the U.P.I.D Act, 1947, we are
of the view that respondent No.1 is not a workman under
the Industrial Disputes Act. Section 2(z) of the U.P.I.D
Act that is similar to section 2 (s) of the Industrail
Disputes Act, 1947 states that:
"’Workman’ means any person (including an
apprentice) employed in any industry to do any
skilled or unskilled manual, supervisory, technical
or clerical work for hire or reward, whether the
terms of employment be express or implied, and
for the purposes of any proceeding under this Act
in relation to an industrial dispute, includes 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,
but does not include any such person-
i) xxx
ii) xxx
iii) who is employed mainly in a managerial or
administrative capacity; or
iv) who, being employed in a supervisory
capacity, draws wages exceeding five
hundred rupees per mensem or exercises,
either by the nature of duties attached to the
office or by reason of the powers vested in
him, functions mainly of a managerial
nature."
In the fact situation of this case, from the perusal of
the job profile of respondent No.1 and after examining
section 2 (z) of the U.P.I.D Act it can be said that,
respondent No.1 did not fall into the category of workman
as contended by the respondents as respondent No.1
falls under exception (iv) of section 2 (z) of the U.P.I.D
Act, 1947.
The case of Sonepat Cooperative Sugar Mills Ltd.
v. Ajit Singh (2005) 3 SCC 232, can be referred to in this
context. Here the respondent was appointed to the post
of "Legal Assistant" the qualification for which was degree
in law with a practicing licence. The nature of his duties
was to prepare written statements and notices, recording
enquiry proceedings, giving opinions to the management,
drafting, filing the pleadings and representing the
appellant in all types of cases. He was also conducting
departmental enquiries against workmen in the
establishment. He was placed in probation and his post
was dispensed with, following which he was terminated.
He raised an industrial dispute.
The question before the Labour Court was "Whether
the applicant was a workman"; Labour Court held he was
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a workman, which was upheld by High Court,
Management preferred an appeal to this Court. Following
the decisions of this Court in A Sundarambal v. Govt.
of Goa, Daman and Diu (1988) 4 SCC 42, HR
Adyanthaya v. Sandoz (India) Ltd. AIR 1994 SC 2608
and rejecting SK Verma v. Mahesh Chandra (supra),
this Court held:
"Thus, a person who performs one or the other
jobs mentioned in the aforementioned provisions
only would come within the purview of the
definition of workman. The job of a clerk ordinarily
implies stereotype work without power of control
or dignity or initiative or creativeness. The
question as to whether the employee has been
performing a clerical work or not is required to be
determined upon arriving at a finding as regards
the dominant nature thereof. With a view to give
effect to the expression to do ’any manual,
unskilled, skilled, technical, operational, clerical
or supervisory work’, the job of the employee
concerned must fall within one or the other
category thereof. It would not be correct to
contend that merely because the employee had not
been performing any managerial or supervisory
duties, ipso facto he would be a workman"
"...The Respondent had not been performing any
stereotype job. His job involved creativity. He not
only used to render legal opinion on a subject but
also used to draft pleadings on behalf of the
appellant as also represent it before various
courts/authorities. He would also discharge quasi-
judicial functions as an enquiry officer in
departmental enquiries against workmen. Such a
job, in our considered opinion, would not make
him a workman."
In A Sundarambal v. Govt. of Goa, Daman and Diu
(supra), question arose as to whether a teacher employed
in a school is a ’workman’ under s.2(s), here this Court
was of the opinion that:
"The teachers employed by educational
institutions, whether the said institutions are
imparting primary, secondary, graduate or
postgraduate education cannot be called as
’workmen’ within the meaning of s.2(s) of the Act.
Imparting of education which is the main function
of teachers cannot be considered as skilled or
unskilled manual work or supervisory work or
technical work or clerical work. Imparting of
education is in the nature of a mission or a noble
vocation. The clerical work, if any they may do, is
only incidental to their principal work or teaching.
It is not possible to accept the suggestion that
having regard to the object of the Act, all
employees in an industry except those falling
under the exceptions (i)-(iv) in s.2(s) of the Act
should be treated as workmen as it will render the
words, "to do any skilled or unskilled, manual,
supervisory, technical or clerical work"
meaningless. Therefore, the appellant teacher of
the school conducted by ... was not a workman,
though the school was an industry, in view of the
definition of ’workmen’ as it now stands."
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It can be observed that even before the Labour
Court as a preliminary objection, it was contended by the
appellant that, the respondent No.1 was not under the
category of workman as defined in section 2 of the U.P.
Industrial Disputes Act, 1947. Hence the reference order
is not covered under the U.P. Industrial Disputes Act,
1947; and the reference order is totally vague, bad in law
and is liable to be rejected. It was also stated before the
Labour Court that the total emoluments for the month of
April, 1983 drawn by Sri Srivastava were totally in his
supervisory capacity and he was designated as Legal
Assistant in the Litigation Department of the Mill and
therefore the reference before the Labour Court is not
maintainable.
Before the Labour Court the respondent was
examined as W.W-I. In his deposition in-chief, he stated
on oath that, on 04.06.1982 he was appointed as the
legal assistant in the Mill. In the cross-examination he
stated that he was appointed in the post of Legal
Assistant in the Mill and a total of Rs 850/- per mensem
was being paid as salary. One Mr. Naresh Pathak was
examined as E.W.-I, he deposed on oath that he was
working as Senior Legal Assistant since 1971 and that
the respondent had worked in his department in the post
of Legal Assistant in June 1982 in a supervisory capacity
and the work of the respondent No.1 was to supervise the
court cases and whenever necessary to prepare draft
reply to matters that are pending in the court. He also
deposed that the work of the respondent was not
satisfactory and in this regard a note was issued to the
General Manager. In cross-examination the witness
deposed that he has no document to prove that the
nature of work of the respondent was supervisory.
However this was not given any kind of serious
consideration by the High Court while deciding on the
claim made by the respondents.
Furthermore if we draw a distinction between
occupation and profession we can see that an
occupation is a principal activity (job, work or calling)
that earns money (regular wage or salary) for a person
and a profession is an occupation that requires
extensive training and the study and mastery of
specialized knowledge, and usually has a professional
association, ethical code and process of certification or
licensing. Classically, there were only three professions:
ministry, medicine, and law. These three professions
each hold to a specific code of ethics, and members are
almost universally required to swear some form of oath to
uphold those ethics, therefore "professing" to a higher
standard of accountability. Each of these professions also
provides and requires extensive training in the meaning,
value, and importance of its particular oath in the
practice of that profession.
A member of a profession is termed a professional.
However, professional is also used for the acceptance of
payment for an activity. Also a profession can also refer
to any activity from which one earns one’s living, so in
that sense sport is a profession.
Therefore, it is clear that respondent No.1 herein is
a professional and never can a professional be termed as
a workman under any law.
The perusal of the appointment order becomes
useful here for addressing the issue whether the High
Court failed to appreciate that the award of the Labour
Court was perverse as it directed the reinstatement with
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backwages of a probationer whose services had been
discontinued upon completion of the probationary period
on account of unsatisfactory work
"MUIR MILLS
UNIT OF NATIONAL TEXTILE CORPORATION (U.P) Ltd. SUBSIDIARY
OF NATIONAL TEXTILE CORPN. Ltd. NEW DELHI
(A GOVERNMENT OF INDIA UNDERTAKING)
Post Box No.33,
Civil Lines,
Kanpur-208 001
Dated: 4th June, 1982
Ref No.
Sri. Swayam Prakash Srivastava,
S/o Sri. Hori Lal Srivastava,
21/8, Safed Colony, Juhi
Kanpur
Dear Sir,
With reference to your application dated 24.05.1982
and subsequent interview you had with us on
27.05.1982, we have pleasure in offering you the post of
Legal Assistant in the pay scale of Rs.330-10-380-EB-12-
500-EB- 15-560/- with a starting basic pay of Rs.330/-
(Rupees Three hundred Thirty only) per month with effect
from the date of your joining the Mills, on the following
terms and conditions:-
1\005.
2\005.
3. You will be on probation for a period of one year from
the date of your joining the Mills. The probation period of
one year can be extended or curtailed at the discretion of
the appointing authority. In the event of your failure to
complete the said probationary period satisfactorily, you
may render yourself liable to be discharged from the
service of the Mill without assigning any reasons and
without any notice. During the period of probation, you
can resign from the service of the Mill without giving any
notice. Unless a letter is issued to you to the effect that
you have completed your probation satisfactorily, the
probation period shall be deemed to have been extended.
No increment shall be granted to you unless you have
completed the said probationary period satisfactorily and
a letter to this effect has been issued to you.
4. After you having completed the probation satisfactorily,
your services can be terminated by the appointing
authority on giving you one month’s notice or pay in lieu
thereof. If you wish to resign from the service of the Mill,
you will have to give one month’s notice or pay in lieu
thereof to the Mill.
5\005.
6. Your employment will be governed by all the rules and
regulations, terms and conditions of service,
administrative orders and/or standing orders presently in
force or as may be framed, amended, altered or extended
from time to time and as applicable to the employees of
the Mills.
7\005.
8\005.
9\005.
10\005.
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11\005.
12. On attaining the age of 58 years, you shall have no
claim to be continued in the service of the Mill thereafter
and your services shall come to an end automatically.
13\005.
14\005.
Yours faithfully
(for) Muir Mills
Unit of NTC (UP) Ltd.
(A.L. MATHUR)
General Manager"
Also if we peruse through the termination order it is
clear that the respondent No.1 was appointed in the
capacity of legal Assistant and his services were
terminated after the completion of the probationary
period.
4th June, 1983
Shri Swayam Prakash Srivastava,
Legal Assistant,
Muir Mills
Kanpur
Reference para 3 of appointment letter No.
PA/16/82 dated 4th June, 1982.
Your performance has not been found satisfactory
and as such, you have failed to complete the
probationary period successfully. Your services are,
therefore, being terminated with immediate effect.
Please contact Accounts Dept. on any working day
and get your dues cleared on production of a ’No
Demand Certificate’ from all the concerned.
For Muir Mills
Unit of NTC (U.P) Ltd.
It is clear from the clause in the appointment letter
and the termination letter that, the Mill had reserved all
rights to discharge from the service of the Mill the
respondent No.1 without assigning any reasons and
without any notice.
Also in the case of Registrar, High Court of
Gujarat & Anr vs. C.G.Sharma (2005) 1 SCC 132, it
was observed that an employee who is on probation can
be terminated from services due to unsatisfactory work.
This Court’s decision in the case of P.N. Verma vs.
Sanjay Gandhi PGI of Medical Studies (supra), can be
referred to in this context, where it was held by this court
that, the services of a probationer can be terminated at
any time before confirmation, provided that such
termination is not stigmatic. This Court in State of
Madhya Pradesh vs. VK Chourasiya 1999 SCC (L&S)
1155 also has held that in the event of a non-stigmatic
termination of the services of a probationer, principles of
audi alteram partem are not applicable.
We are also of the view that the award of the Labour
Court is perverse as it had directed grant of backwages
without giving any finding on the gainful employment of
respondent No.1 and held that the discontinuance of the
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services of a probationer was illegal without giving any
finding to the effect that the disengagement of respondent
No.1 was in any manner stigmatic. The decision in the
case of MP State Electricity Board vs. Jarina Bee
(Smt) (supra), this court held that payment of full back
wages was not the natural consequence of setting aside
an order of reinstatement. In the instant case, though
the termination was as far back as in 1983, the
Industrial Adjudicator has not given any finding on
unemployment. This Court in a recent case of State of
Punjab vs. Bhagwan Singh (2002) 9 SCC 636 has held
that even if the termination order of the probationer
refers to the performance being ’not satisfactory’, such an
order cannot be said to be stigmatic and the termination
would be valid.
Further the Labour Court issued notices to both
parties and after adducing evidence and hearing both the
parties, it has recorded a finding that the termination of
services of the concerned workman, during his service,
was neither based on unsatisfactory work nor the same
could have been proved before the labour court and
therefore, the labour court arrived at the conclusion and
recorded a finding that the services of the workman have
been terminated by way of victimization and unfair
labour practice. Aggrieved by the aforesaid award, the
employer-petitioner has come before this court by means
of the present writ petition. An application has been filed
by the workman concerned that the employer has not
complied with the aforesaid interim order.
However, we are of the view that, the emoluments
for the month of April, 1983 drawn by respondent No.1
was Rs.866.51 and the nature of duties of respondent
No.1 were totally supervisory capacity and he was
designated as Legal Assistant in the Mill’s litigation
department. So the respondent is not entitled to raise an
Industrial Dispute and also that his services are governed
by all the rules and regulations, terms and conditions of
service, administrative orders and/or standing orders
presently in force or as may be framed, amended, altered
or extended from time to time and as applicable to the
employees of the Mills as is clear from the appointment
order of 04.06.1982. Also it is clear from the facts that
the appellants have complied with the interim order of
the High Court.
We also observe that the respondent No.1 had been
receiving interim wages for over 15 years without having
worked at all and without having established his
unemployment. The High Court failed to appreciate that
the award itself had only granted reinstatement to
respondent No.1 as a probationer giving the petitioner
the right to take a decision on confirmation. Further the
Mill itself has been shut down now and given the lapse of
22 years, it was impracticable to reinstate respondent
No.1 as a probationer.
It is also pertinent to mention Section 2(oo) of the
Industrial Disputes Act. Section 2 (oo) of the I.D.Act,
1947 states that,
"2. (oo) "retrenchment" means the termination
by the employer of the service of a workman
for any reason whatsoever, otherwise than as a
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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)\005
(c )\005"
However, this provision is not applicable to the U.P.
Industrial Disputes Act, 1947.
With regard to the contention of the respondents
that in the present fact scenario retrenchment is bad
under law as conditions under section 6-N, which talks
about a reasonable notice to be served on an employee
before his/her retrenchment, is not complied with; we are
of the view that an even under Section 6-N, proviso states
that ’no such notice shall be necessary if the
retrenchment is under an agreement which specifies a
date for the termination of service." In the present case
on the perusal of the appointment letter it is clear that no
such notice needs to be issued to respondent No.1.
The respondents had referred to many cases with
regard to backwages to be paid to the retrenched
workman. The learned counsel cited a string of decisions
of this court in support of this contention. We are
however not addressing this plea of the respondents, as
we have already observed that respondent No.1 is not a
workman under the Industrial Disputes Act, 1947 and
the U.P.I.D Act, 1947 and also that the retrenchment was
not illegal and therefore the question of backwages do not
arise.
In the result, we allow the appeal preferred by the
appellants and set aside the award of the Labour Court
and the orders of the High Court. We also observe that no
recovery certificate needs to be issued in favour of
respondent No.1, in lieu of the show cause notice issued
by the Deputy Labour Commissioner. However we state
that the salary that has been already paid to respondent
No.1 under the orders of the court will not be recovered
from the respondent. The High Court while passing the
interim order dated 02.12.1997 in writ petition No. 193 of
1997 while granting stay of the award of the Labour
Court directed the Management to deposit half of the
amount decreed and also continue to deposit the amount
of salary of respondent in future until further orders and
that the past award if deposited could be withdrawn by
the workman after furnishing security. However, no
security need be given to the withdrawal of the amount
which is to be deposited as future salary.
In view of our finding that the respondent is not a
workman, he will not be entitled to payment of half of the
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decreed amount which was ordered to be deposited. If
the amount has not been withdrawn so far, the
Management is at liberty to withdraw the same from the
court deposit. However we are not ordering costs.