Lump sum compensation substituted for reinstatement to balance long service against established disciplinary misconduct.

The petitioner was employed as a Driller with the respondent company since February 1, 1996

Following internal inquiry proceedings regarding allegations of remaining absent from his duty post while on duty, the respondent terminated his services

The petitioner raised an industrial dispute, leading to a reference under Section 10(1)(c) of the Industrial Disputes Act, 1947

The Labour Court No. 1, Bharuch, in Reference (LCB) No. 81 of 2018, rejected the petitioner’s claim for reinstatement and backwages on April 18, 2019

The petitioner subsequently challenged this award before the High Court under Articles 226 and 227 of the Constitution

1. Whether the Labour Court's award rejecting the reference was illegal, arbitrary, or in violation of the principles of natural justice

2. Whether the petitioner is entitled to reinstatement with full backwages or alternative relief in the form of lump sum compensation

The Court primarily applied Section 11-A of the Industrial Disputes Act, 1947, which grants discretionary powers to labor courts to modify discharge or dismissal orders

It relied on the precedent set by the Hon’ble Supreme Court in *Maharashtra State Cooperative Marketing Federation Limited v. Suresh S/o Dadarao Gadge* (2015) 4 SCC 542, and recent Division Bench rulings of the Gujarat High Court (LPA No. 908/2023 and LPA No. 1091/2023), which establish that reinstatement is not an automatic consequence of illegal termination and that lump sum compensation may be an appropriate alternative remedy depending on the length of service and the nature of the dispute

The Court reviewed the Labour Court's findings and the inquiry proceedings, noting the respondent's argument that the petitioner had participated in the inquiry but later avoided service of the second show-cause notice

While the petitioner argued that the Labour Court misinterpreted the Model Standing Orders regarding misconduct, the High Court focused on balancing the equities

Referring to the tabular compensation framework established in LPA No. 908 of 2023, the Court determined that given the time gap since termination and the peculiar facts of the case, reinstatement was not the ideal remedy

The Court noted that for a service period of 15-20 years (the petitioner served from 1996 until the dispute), a lump sum amount serves the interest of justice better than a protracted order for reinstatement

Instead of reinstatement and backwages, the Court ordered the respondent to pay the petitioner a lump sum compensation of ₹5,00,000/- as a full and final settlement

The respondent was directed to transfer the amount via RTGS within eight weeks of receiving the order