Workmen who waive permanent-status benefits under a settlement cannot later claim retrospective regularisation.

The respondent was temporarily engaged by the appellant Transport Corporation.

On 31 May 2005, the competent authority under the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981, passed an order in the workmen’s favour.

A Section 12(3) settlement was subsequently entered into between the union and the Corporation on 31 August 2005.

In connection with the settlement, the respondent undertook not to claim benefits under the competent authority’s order; his services were regularised with effect from 1 September 2005.

In 2014, he sought a direction for consideration of his claim to regularisation from completion of 480 days’ service.

After the Corporation rejected his claim in 2023, he filed W.P. No. 10548 of 2024, which the Single Judge allowed.

The Corporation appealed.

1. Whether the respondent, having undertaken not to claim benefits under the permanent-status order and accepted regularisation under the Section 12(3) settlement, could later claim retrospective regularisation based on that order

2. Whether the respondent’s unexplained delay, and failure to challenge the settlement and consequential regularisation, barred the claim

Section 3 of the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981, provides for conferment of permanent status on qualifying workmen; however, the Court held that a workman who accepted regularisation under a binding Section 12(3) settlement and undertook not to claim the benefit of an earlier permanent-status order could not later seek retrospective regularisation on that basis.

The Court relied on Section 18(3) of the Industrial Disputes Act, 1947, under which a settlement reached in the course of conciliation is binding on the parties.

It also applied the doctrines of delay and laches and acquiescence, relying on Prabhakar v. Joint Director, Sericulture Department, (2015) 15 SCC 1: an unexplained delay may defeat a claim, and a party who stands by while conduct inconsistent with its asserted right occurs may be barred from later complaining.

The Court followed the Division Bench decision in Managing Director, Tamil Nadu State Transport Corporation Ltd. v. O. Veeraiyya, (2025) MHC 2050, and noted its application in R. Rajendran v. Metropolitan Transport Corporation (Chennai) Ltd., (2026) MHC 2500.

The respondent had expressly undertaken, in connection with the 31 August 2005 settlement, not to claim the benefit of the permanent-status order, and accepted regularisation from 1 September 2005.

He did not challenge either the settlement or the regularisation, but sought retrospective regularisation years later without explaining the delay.

Applying the binding effect of the settlement and the principles of laches and acquiescence, the Court held that he could not revive the claim after having accepted the settlement’s terms.

It distinguished the authorities cited by the respondent because they involved no comparable undertaking and did not address delay, laches, and acquiescence.

It set aside the Single Judge’s order dated 1 October 2024, allowed the writ appeal, made no order as to costs, and closed the connected miscellaneous petition.