Lump-sum compensation is appropriate replacement for reinstatement when delay exists and employee reaches superannuation.

The respondent was appointed as a daily wager (Chowkidar) on June 21, 1985

His services were terminated on April 30, 1995, following which he raised an industrial dispute in 2013 after a delay of 18 years

The Labour Court, Mehsana, in Reference (LCM) No. 93 of 2013, found that the petitioners failed to comply with the mandatory requirements of Section 25F of the Industrial Disputes Act, 1947, and directed reinstatement with continuity of service but without back wages

The State challenged this award, arguing that the workman did not complete 240 days of service in the preceding 12 months and that the 18-year delay rendered the claim "not live"

During the pendency of this petition, the respondent reached the age of superannuation on January 31, 2025

1. Whether the termination of the respondent was illegal due to non-compliance with the mandatory provisions of the Industrial Disputes Act

2. Whether the gross delay of 18 years in raising the industrial dispute affects the relief of reinstatement

3. What is the appropriate relief when reinstatement is rendered impossible due to the employee attaining the age of superannuation during litigation

The Court applied Section 25F of the Industrial Disputes Act, 1947, which mandates conditions precedent for the retrenchment of workmen, and Section 25B regarding the definition of continuous service

It relied on the settled legal principle that illegal termination does not automatically entitle an employee to back wages; the burden lies on the employee to prove they were not gainfully employed

The Court followed the precedent set by the Honorable Division Bench in Bhikhbhai Fatabhai Solanki v. Executive Engineer, Narmada Project Canal System (LPA No. 908/2023), which establishes that for daily wagers with less than 10 years of service whose reinstatement is not feasible, a lump-sum compensation (specifically Rs. 3 lakhs) is an appropriate substitute for reinstatement

The Court upheld the Labour Court's finding that the termination was illegal as the petitioners failed to produce muster rolls or pay slips to disprove the workman's claim of continuous service under Section 25B

The Court noted the "yawning gap" of 18 years in raising the dispute and the fact that the respondent reached superannuation in 2025, making the order of reinstatement academic

Since the respondent had not challenged the denial of back wages, that portion of the award attained finality

Applying the ratio in Bhikhbhai Fatabhai Solanki, the Court reasoned that since the respondent served for less than 10 years (1985–1995) and cannot be reinstated, the interest of justice would be served by modifying the award to provide monetary compensation in lieu of the original relief

The High Court partly allowed the petition and modified the impugned award dated May 8, 2018. The petitioners were directed to pay a lump-sum compensation of Rs. 3,00,000/- to the respondent within eight weeks. Failure to pay within the stipulated time carries an interest rate of 6% p.a. from the date of termination until the date of superannuation. Rule was made absolute to this extent with no order as to costs.