Chelmsford Club Limited vs Diwan Singh
- Court
- Delhi High Court
* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Reserved on : 24.08.2026
Pronounced on : 30.10.2026
Uploaded on : 30.10.2026
# CNR No.DLHC011458022018
+ W.P. (C) 13701/2018, CM APPL. 37395/2021 and
CM APPL. 55114/2026
CHELMSFORD CLUB LIMITED. .....Petitioner
Through: Mr. Rajiv Bakshi, Advocate
versus
DIWAN SINGH .....Respondent
Through: Mr. Mukesh Gupta, Mr. Raghav
Gupta and Mr. DevanshWahi,
Advocates
CORAM:
HON'BLE MR. JUSTICE MANOJ KUMAR OHRI
JUDGMENT
1. By way of the present writ petition filed under Articles 226 and
227 of the Constitution of India, the petitioner seeks to assail the
award/order dated 20.01.2018 passed by the Pilot Court/POLC-XVII,
Dwarka Courts, New Delhi (hereinafter referred to as the “Labour
Court”) in Case No. LC 1453/16 (Old No. 314/10), whereby the
petitioner was directed to reinstate the respondent/workman with
continuity of service and 25% back wages from the date of
termination. The petitioner/club (hereinafter referred to as the
“Management”) was further directed to extend the said benefits within
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one month from the date of publication of the award, failing which an
interest at the rate of 9% per annum was made payable.
2. The statement of claim came to be filed by the respondent who
had joined the management as a waiter in April 1998 and his last
drawn salary was Rs.4,200/- per month. It was his case that from April
2005, he was also assigned the duties of a barman, although the
corresponding pay scale was not extended to him. He was an active
member of the Chelmsford Club Karamchari Union and had been
elected as an Executive Member in 2007 and as its Secretary in 2009.
According to him, the management became hostile towards him on
account of his union activities and his demand for the pay scale
applicable to a barman. His services came to be terminated by the
petitioner vide letter dated 09.07.2010.
3. The management, on the other hand, denied that the respondent
had been assigned the duties of a barman in the manner alleged by him
and disputed the assertion that his termination was connected with his
union activities. Its case was that the dispute arose against the
backdrop of two charge-sheets issued to him, dated 05.11.2007 and
17.11.2007. The first charge-sheet alleged that he had been found in
possession of 12 bottles of Royal Stag whisky without an official
receipt or cash memo. The second charge-sheet alleged that he had
failed to deposit sale proceeds of Rs.17,971/- pertaining to 10.10.2007
and Rs.2,920/- pertaining to 15.10.2007. The respondent disputed the
allegations and challenged the termination as illegal and unjustified.
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4. The industrial dispute raised by the respondent resulted in a
reference to the Labour Court, which framed the following issues on
29.08.2014:
1. whether the management was an industry within the
meaning of Section 2(j) of the Industrial Disputes Act, 1947;
2. whether the claim was not maintainable in view of the
preliminary objection no.3 taken in the written statement;
3. whether the services of the workman had been
terminated illegally and/or unjustifiably; and the relief to which
he was entitled.
4. Relief.
5. The respondent entered the witness box and tendered his
affidavit in support of his statement of claim. He also relied upon the
correspondence exchanged during the domestic enquiry, the
termination letter dated 09.07.2010, the demand notice dated
19.07.2010 and the other documents forming part of the record. The
management examined its Chief Administrative Officer, Raman
Kwatra , as MW-1, who supported the management’s stand that the
Club was not an industry within the meaning of the Industrial Disputes
Act, 1947 (hereinafter referred to as the “Act”) and reiterated its case
concerning the misconduct alleged against the respondent.
6. On the question whether the petitioner was an industry, the
Labour Court did not accept the management’s contention that its
activities were outside the scope of Section 2(j) of the Act merely
because its receipts were derived from subscriptions and contributions
of its members and its object was to provide facilities to them. The
evidence disclosed that the Club operated bars, restaurants and a
banquet hall, besides other facilities, and employed a substantial
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workforce to provide these services. In his cross-examination, MW-1
admitted that the Club had two bars, two restaurants, a banquet hall
and a lawn which was made available to customers. He also admitted
that persons becoming members for the first time were charged a one-
time amount, followed by annual charges, and stated that the Club had
2,337 permanent members. The Labour Court further took note of the
management witness’s admission that disputes concerning the
regularisation of two contractual employees had previously been
settled with the management. On this evidence, it held that the
activities carried on by the Club constituted an organised activity and
that the management Club fell within the definition of an industry
under Section 2(j) of the Act.
7. The management had also objected to the maintainability of the
claim on the ground that a settlement dated 19.01.2008 provided, in
Clause 12, a mechanism for the redressal of grievances. The Labour
Court recorded that the management had not placed the said settlement
on record and declined to accept the objection on the basis of a
document that had not been proved before it. It also considered the
statutory provisions relied upon in that context and rejected the
preliminary objection.
8. The principal controversy concerned the allegations of
misconduct and the justification for terminating the respondent’s
services. With respect to the 12 Royal Stag Whisky bottles, the Labour
Court considered the respondent’s explanation that the said liquor had
been gifted to him by a Club member, Vinod Chawla , outside the
premises of the management, for a marriage in his family.
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Significantly, even MW-1 admitted in cross-examination that the
bottles had been gifted by the member. The record further showed that
the membership of the said member was initially cancelled but was
subsequently restored after his explanation was considered. MW-1
also admitted that there was no standing order in force which
prohibited an employee from accepting a gift of whisky from a
member. The Labour Court observed that, if the possession of the
liquor was unlawful, the matter could have been referred to the police
for investigation, but no such step had been taken by the management.
In these circumstances, it held that the allegation concerning
possession of the whisky bottles did not justify termination of the
respondent’s services.
9. The Labour Court separately examined the charge relating to the
sale proceeds. It noted that the respondent had not deposited
Rs.17,971/- relating to 10.10.2007 on the same day or the following
day. However, the management witness admitted that the respondent
had explained that his pocket had been cut on 11.10.2007, which
accounted for the delay in depositing the amount relating to
10.10.2007. The position concerning the amount of Rs.2,920/- relating
to 15.10.2007 was different. The respondent had no explanation for
failing to deposit that amount on the same day or the following day.
The Labour Court, therefore, expressly held that the respondent was
guilty of misconduct to that extent. It was also recorded that the total
amount of Rs.20,891/- was deposited on his behalf by another barman,
Krishna , on 23.10.2007.
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10. The finding of misconduct was not ignored by the Labour Court
while determining the relief. It considered the fact that the sale
proceeds had ultimately been deposited and that no pecuniary loss had
been caused to the management. It also noted that the management had
not placed the respondent’s previous service record on record to
establish that he had committed similar misconduct in the past. On an
assessment of these circumstances, the Labour Court held that,
notwithstanding the misconduct concerning the delayed deposit of
Rs.2,920/-, termination of the respondent’s services was unjustified.
11. While determining the relief, the Labour Court took into
account that the respondent had worked with the petitioner from April
1998 until his termination on 09.07.2010, thereby completing
approximately 12 years of service. It also noticed that the petitioner
continued to carry on its activities through its establishments and
employees. Reinstatement with continuity of service was, therefore,
directed. However, the Labour Court did not grant full back wages. It
observed that the respondent had experience as a waiter and barman
and could have sought employment in a restaurant, café or bar. On this
reasoning, back wages were restricted to 25% from the date of
termination.
12. Before this Court, the petitioner has challenged the award
principally on the grounds that the findings of the Labour Court are
contrary to the evidence and law, that material evidence was not
properly appreciated, that the respondent’s case was based on false and
concocted allegations, and that the Labour Court failed to appreciate
the circumstances in which the domestic enquiry could not be
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completed. The petitioner has also questioned the findings concerning
its status as an industry and the grant of reinstatement and back wages.
13. The respondent’s case before the Labour Court, in contrast, was
that the allegations concerning the whisky bottles had been explained,
that the management’s own witness supported the explanation
regarding the gift, and that the delay in depositing the sale proceeds
had caused no ultimate pecuniary loss. The respondent also relied
upon the absence of any proved past misconduct and the
circumstances in which the termination had taken place.
14. The rival submissions have been considered in the light of the
record. The question before this Court is not whether another view of
the evidence could possibly be taken, but whether the findings
returned by the Labour Court suffer from any perversity, jurisdictional
infirmity or such disregard of material evidence as would warrant
interference in exercise of the supervisory jurisdiction of this Court.
15. On the issue concerning the status of the petitioner as an
industry, the findings of the Labour Court are founded on the nature of
the activities carried on by the Club and the admissions made by its
own witness. The management’s plea that the Club was not operating
for profit and that its facilities were intended for the benefit of
members did not justify the question whether the activities undertaken
constituted an organised activity within the meaning of Section 2(j) of
the Act. The Labour Court considered the facilities operated by the
petitioner, the number of members, the charges collected and the
employees engaged in providing the services. The conclusion that the
petitioner was an industry was thus based on the evidence on record
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and cannot be characterised as perverse merely because the
management seeks a different inference to be drawn from the same
evidence.
16. The objection founded on the settlement dated 19.01.2008 also
does not furnish a ground for interference. The Labour Court
specifically recorded that the management had not produced the
settlement on which it relied. In the absence of the document being
proved, the management could not secure rejection of the respondent’s
claim solely on the assertion that the settlement contained a grievance-
redressal mechanism. No error is made out in the Labour Court’s
decision to determine the issue on the material available before it.
17. As regards the misconduct, the award demonstrates that the
Labour Court considered the two charges separately and did not treat
the respondent as having been exonerated of every allegation. It
accepted the explanation regarding the whisky bottles after
considering the admission of MW-1 that the bottles had been gifted by
a Club member and that no standing order prohibited the acceptance of
such a gift. More pertinently, the said exchange had taken outside the
club premises. In relation to the sale proceeds, it expressly held the
respondent guilty of misconduct concerning the delayed deposit of
Rs.2,920/-. The conclusion that termination was nevertheless
unjustified was reached after taking into account the eventual deposit
of the entire amount, the absence of pecuniary loss and the absence of
evidence of similar past misconduct. The Labour Court thus
considered the misconduct established on the record and its
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implications for the question of termination, rather than overlooking
the charge altogether.
18. The petitioner has not demonstrated that the aforesaid findings
rest on no evidence or that material evidence was excluded or
inadmissible material was relied upon in a manner affecting the
outcome. The challenge, in substance, seeks a fresh assessment of the
evidence and a substitution of the management’s appreciation of the
circumstances for that of the Labour Court. The fact that a different
conclusion may be urged on the evidence is not, by itself, sufficient to
warrant interference in proceedings under Articles 226 and 227 of the
Constitution of India.
19. The grant of relief must also be seen in the context of the
reasons recorded in the award. The Labour Court took note of the
respondent’s approximately 12 years of service and directed
reinstatement with continuity. At the same time, it declined to award
full back wages and restricted the entitlement to 25%, having regard to
the respondent’s experience and the possibility of his obtaining similar
employment elsewhere. The relief was thus not granted mechanically,
the Labour Court considered both the length of service and the
question of back wages separately. No ground has been shown which
would justify this Court in substituting its own assessment of the relief
in the absence of a demonstrated legal infirmity in the award.
20. The limits of this Court’s jurisdiction in proceedings of the
present nature stand settled by the decision of the Supreme Court
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1
in “ Syed Yakoob v. K.S. Radhakrishnan ” . The power to issue a writ of
certiorari is supervisory and not appellate. Findings of fact reached by
a tribunal upon appreciation of evidence cannot ordinarily be reopened
merely because another view is possible. Interference may be
warranted where the tribunal has acted without or in excess of
jurisdiction, violated the principles of natural justice, committed an
error of law apparent on the face of the record, or returned a finding
based on no evidence.The present case does not fall within those
recognised grounds. The findings under challenge are supported by the
evidence considered by the learned Labour Court, and the petitioner
has not established any jurisdictional or patent legal error warranting
interference.
21. In view of the above, this Court finds no ground to interfere
with the award dated 20.01.2018 passed by the Labour Court and the
same is upheld. The writ petition is accordingly dismissed.
22. Pending applications, if any, stand disposed of along with the
petition.
(MANOJ KUMAR OHRI)
JUDGE
OCTOBER 30, 2026
na
1
AIR 1964 SC 477
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