Burden lies on management to lead cogent evidence to prove workman's gainful employment under Section 17-B ID Act

The Appellant-Management challenged an order dated 16.04.2026 passed by a learned Single Judge under Section 17-B of the Industrial Disputes Act, 1947 ("I.D. Act").

A Labour Court Award dated 02.02.2019 had directed the reinstatement of the Respondent-Workman with 50% back wages.

While the Management’s writ petition challenging this Award was pending, the Workman sought interim wages under Section 17-B.

The Management contested this, submitting a private investigation report from M/s. Netrika Consulting claiming the Workman was gainfully employed at a jewelry shop in Karol Bagh.

The Workman denied this, asserting he only visited the shop for personal purchases.

A court-ordered status report from the SHO, Karol Bagh, revealed the shop had been closed for two years.

Consequently, the Single Judge allowed the Section 17-B application, directing payment of last drawn or minimum wages.

1. Whether the Appellant-Management successfully discharged the burden of proof to establish that the Respondent-Workman was in gainful employment to deny relief under Section 17-B of the I.D. Act.

2. Whether the findings of a private investigation report, characterized by disclaimers and hearsay, are sufficient to override the beneficial statutory mandate of Section 17-B.

Section 17-B of the I.D. Act, 1947, which mandates the employer to pay last drawn wages to a workman during the pendency of proceedings in higher courts against an award of reinstatement.

Dena Bank v. Kiritikumar T. Patel, which established that the scope of inquiry under Section 17-B is limited and the provision is beneficial in nature.

Deepali Gundu Surwase v. Kranti Junior Adhyapak Mahavidyalaya and Pradeep s/o Rajkumar Jain v. Manganese Ore (India) Limited, holding that once a workman states they are not gainfully employed, the onus shifts to the employer to lead cogent evidence to prove otherwise.

The Bench reasoned that Section 17-B is a statutory obligation that can only be denied if the employer proves the workman is receiving adequate remuneration in another establishment.

The Court found the Management’s evidence—a private investigation report—insufficient because it was based on "discreet inquiry" and "hearsay".

Furthermore, the investigator had passed away, and the Management failed to produce the caller or recipient of the alleged telephonic inquiries.

This weak evidence was directly contradicted by a neutral Status Report from the SHO, which confirmed the alleged place of employment had been closed for two years.

The Court held that the Management "utterly failed" to discharge its burden of proof, and the Workman's explanation regarding his presence at the shop for a niece's wedding was plausible and could not be brushed aside.

It held that the provisions of Section 17-B are beneficial and mandatory unless gainful employment is strictly proven by the employer.

The High Court upheld the Single Judge’s order directing the Appellant to pay the Respondent the last drawn wages or minimum wages (whichever is higher) from the date of the Award and continue payments during the pendency of the writ petition.

No order as to costs was made.