Facts
The petitioner (employer) challenged an award dated January 31, 2025, passed by the Labour Court, Vadodara, in Reference (LCV) No.110 of 2017.
Source reference: p. 1The Labour Court had partially allowed the reference, granting the respondent (workman) reinstatement with continuity of service and 25% backwages.
Source reference: p. 1During the pendency of this writ petition under Articles 226 and 227 of the Constitution of India, the parties entered into an out-of-court amicable settlement on February 13, 2026.
Source reference: p. 2Issues
1. Whether the impugned award of the Labour Court regarding reinstatement and backwages should be modified in light of the subsequent settlement agreement between the parties.
Source reference: p. 2, 5Law Applied
The court primarily applied Section 2(p) of the Industrial Disputes Act, 1947, which defines and governs settlements between employers and workmen.
Source reference: p. 2It also exercised its supervisory jurisdiction under Articles 226 and 227 of the Constitution of India to substitute the judicial award with the voluntary contractual obligations agreed upon by the parties.
Source reference: p. 1, 5Reasoning
The Court examined the Memorandum of Settlement submitted by the parties, noting it was executed in vernacular language and signed voluntarily.
Source reference: p. 2According to the terms, the workman agreed to waive his right to reinstatement and backwages in exchange for a lump-sum payment of ₹4,11,000 (inclusive of statutory dues and union levy).
Source reference: p. 3The Court found that the settlement was reached with full awareness, without pressure, and was intended to be a full and final settlement of all disputes, including those in Recovery Application No. 241/2025.
Source reference: p. 3, 4Consequently, the Court determined that the original Labour Court award no longer reflected the consensus of the parties and required modification to incorporate these compromise terms.
Source reference: p. 5Holding
The High Court modified the impugned award dated January 31, 2025, to align with the terms and conditions of the settlement agreement dated February 13, 2026.
The Court held that the respondent-workman is entitled to the agreed sum of ₹4,11,000 as a full and final settlement, and the right to reinstatement stands waived.
Source reference: p. 3, 5The petition was partly allowed in terms of the settlement.
Source reference: p. 5Original Court PDF
Jewel Consumer Pvt. Ltd. v. Firozbhai Akbarbhai Parmar [2026:GUJHC:15135]
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