Reinstatement entails continuity of service unless the Labour Court expressly denies it.

The appellant-workman was engaged as a daily-wager by the State from 1 July 2010 until his oral termination on 30 September 2014. He raised an industrial dispute, leading to Reference Case No. 87 of 2019. By award dated 12 January 2024, the Labour Court held the termination illegal and directed reinstatement without consequential benefits; it did not expressly address continuity of service.

The State challenged the award in Special Civil Application No. 3145 of 2025. The learned Single Judge upheld the substantive finding but substituted reinstatement with lump-sum compensation of ₹3,00,000.

The workman preferred the present Letters Patent Appeal, contending that the precedent relied upon by the Single Judge concerned deceased workmen and was therefore inapplicable since he was alive and willing to rejoin service.

Whether the learned Single Judge was justified in substituting the Labour Court’s direction of reinstatement with lump-sum compensation by relying on the decision in Letters Patent Appeal No. 908 of 2023?

Whether the appellant was entitled to continuity of service where the Labour Court had directed reinstatement but had neither expressly granted nor denied continuity of service?

Whether the appellant could claim consequential benefits despite not challenging the Labour Court’s award on that aspect?

The Court applied the principle that reinstatement ordinarily carries continuity of service unless the Labour Court expressly denies it.

Relying on Nandkishore Shravan Ahirrao v. Kosan Industries (P) Ltd., (2020) AIR SC 1776, the Court held that where reinstatement is awarded and continuity of service is not specifically denied, continuity follows as a matter of law.

The Court also applied the appellate principle that a party which has not challenged an adverse part of the original order cannot seek relief on that aspect in an appeal directed against a subsequent modifying order; accordingly, the appellant could not claim consequential benefits not granted by the Labour Court.

The Court distinguished the precedent in LPA No. 908 of 2023 dated 18 April 2024, as that case involved workmen who were no longer alive and therefore did not govern a case where the workman was alive and willing to resume employment.

The Court found that the factual basis for awarding compensation instead of reinstatement in LPA No. 908 of 2023 was materially different because the workmen in that case were deceased.

Here, the appellant was alive, willing to rejoin, and had been granted reinstatement by the Labour Court. Since the learned Single Judge had not found any error in the Labour Court’s substantive direction of reinstatement, there was no sufficient basis to replace that relief with compensation.

The Court therefore restored reinstatement. Applying Nandkishore Shravan Ahirrao, it held that the Labour Court’s silence on continuity of service could not be treated as a denial; continuity consequently followed from the reinstatement order.

However, because the appellant had not challenged the Labour Court’s refusal to grant consequential benefits, he could not obtain such benefits in the present appeal.

The Court set aside the learned Single Judge’s direction granting ₹3,00,000 as lump-sum compensation in lieu of reinstatement.

The Labour Court’s direction reinstating the appellant without consequential benefits was confirmed.

The respondents were directed to comply within eight weeks from receipt of the judgment, and the appellant was held entitled to continuity of service from the date of termination until the date of reinstatement.