Premature retirement based on an undisputed incorrect birth date warrants back wages and consequential benefits.

The petitioner was employed by the respondent from 1 October 1974. After the respondent sought proof of his date of birth, he submitted school records showing it as 1 June 1953. The respondent nevertheless retired him on 28 November 2006, treating him as having reached superannuation.

The Labour Court set aside the premature retirement but awarded ₹2,00,000 in compensation instead of reinstatement and consequential benefits, on the ground that the petitioner had by then reached superannuation.

The Labour Court found that, based on the accepted date of birth, the petitioner’s correct retirement date was 30 June 2011.

The petitioner challenged the compensation award; the respondent submitted that it had already paid the ₹2,00,000.

Whether, after the Labour Court found that the petitioner had been prematurely retired and that finding remained unchallenged, he was entitled to back wages and consequential service benefits until his correct retirement date, rather than compensation in lieu of those benefits.

Whether the ₹2,00,000 already paid as compensation should be set off against the amount payable.

Section 10(4-A) of the Industrial Disputes Act, under which the petitioner brought his application, provided the procedural basis for the Labour Court proceedings.

The Court applied the principle in Iswarlal Mahanlal Thakkar v. Paschim Gujarat Vij Company Limited, (2014) 6 SCC 434: where an employee’s service is prematurely ended on an incorrect date of birth, the employee is entitled to back wages and other consequential monetary benefits from the date of termination until the correct date of superannuation.

The Court treated the Labour Court’s finding of premature retirement, which the management had not challenged, as standing.

The petitioner had produced records supporting his date of birth while still in service, and those records had been accepted by the Labour Court. The Labour Court consequently found that he had been retired prematurely and had remaining service until 30 June 2011; the management did not challenge that finding.

In light of the principle in Iswarlal Mahanlal Thakkar, the Court held that compensation of ₹2,00,000 could not replace the back wages and consequential service benefits due for the period between premature retirement and the correct retirement date.

It distinguished the respondent’s cited decisions on their facts, including a case in which the employee had raised the date-of-birth dispute only after retirement and receipt of retirement benefits.

It held the petitioner entitled to back wages and consequential service benefits from 28 November 2006 to 30 June 2011.

The ₹2,00,000 already paid was to be set off against the amount due, and the balance was directed to be calculated and paid within twelve weeks of receipt of the certified copy of the order.