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1989 DIGILAW 173 (ORI)

SHYAM SUNDAR ROUT v. ORISSA STATE ROAD TRANSPORT CORPORATION

1989-05-10

A.K.PADHI, K.P.MOHAPATRA

body1989
JUDGMENT : A.K. Padhi, J. - In these two writ applications as common question of law arise for consideration both the matter were heard together and are disposed of by this common judgment. 2. The facts of O.J.C. No. 2211 of 1988 are the Petitioner under intermittent orders of appointment for specified periods continued in service from 13-3-1980 till 18-7-1988 as a conductor under opp. party No. 1. The Petitioner comes within the definition of "workman" and the provisions of Industrial Disputes Act are applicable to him. It has been asserted in the writ application that the Petitioner had served for 240 days in each financial years and as such his service comes within the definition of "continuous service" as envisaged u/s 25-B of the Industrial Disputes Act. It is claimed that the Petitioner was selected by the Divisional Selection Committee and his appointment should have been regularised. On 26-9-1986 a notice was served on him purported to be a notice u/s 25 F of the Industrial Disputes Act giving him one month's prior notice of retrenchment. The relevant portions of Annexure-I, the notice, is as follows: You are directed to note that your Services will not be required with effect from 29-7-1988 (Forenoon). This may be treated as one month's notice as required u/s 25-F(a) of the I.D. Act 1947. You are allowed to draw 45 days average pay retrenchment compensation. Before the notice period of one month was completed, the Petitioner was relieved from duty on 18-7-1988. The assertion by the Petitioner is that he was not paid the retrenchment compensation or pay of one month in lieu of one month's notice before he was unilaterally relieved from duty. It is submitted that payment of retrenchment benefits being pre-condition to the retrenchment order having not been complied with, the retrenchment order is void ab initio as per the provisions of Section 25-F(b) of the Act and as such is liable to be quashed. 3. Opp. party No. 1 has filed a counter affidavit. The employment of the Petitioner for 240 days for preceding three years is admitted. It is averred, after being aware that he is to be retrenched the Petitioner left the office to avoid service of retrenchment order, relieve order and payment of retrenchment compensation. 3. Opp. party No. 1 has filed a counter affidavit. The employment of the Petitioner for 240 days for preceding three years is admitted. It is averred, after being aware that he is to be retrenched the Petitioner left the office to avoid service of retrenchment order, relieve order and payment of retrenchment compensation. As the Petitioner was absent on 18-7-1988 from the office, the retrenchment order, the relieve order and the retrenchment benefits in shape of money were sent to the residence of the Petitioner at Baripada on the same day. This was delivered back by the messenger with intimation that the Petitioner was absent from his residence. On the next day (19-7-1988) the retrenchment benefits amounting to Rs. 2,538/- was deposited in the bank and bank draft bearing No. TTA-95-610710 was obtained on 20-7-1988. On the same day along with the order of retrenchment and the relieve order and the draft were sent to the Petitioner by Registered Post in his residential address. This also returned undelivered to the D.T.M. with the endorsement that the addressee was absent. On 12-8-1988 the Petitioner appeared in the office and gave an application in writing, the English translation of which is as follows: My retrenchment benefits were sent to my house. I had not taken it as I was absent from the house. The said money I want to take today i.e. on 12-8-1988. (translation is mine) On 12-8-1988, the Petitioner has also signed in token of the receipt of letter dated 18-7-1988, memo dated 1871988, and letter dated 20-7-1988 and receipt of the bank draft. The assertion that the retrenchment benefits and the retrenchment order could not be served on the Petitioner due to his absence from the office as well as the residence has not been admitted nor specifically denied by the Petitioner by any affidavit. In the counter affidavit filed by the opp. party No. 3 it has been averred that the Petitioner had worked only for three years for a period of 240 days and the Petitioner was entitled to 45 days of pay as required u/s 25-F(B) of the Act. This assertion has also been denied by the Petitioner. 4. The facts as averred in O.J.C. No. 2212 of 1988 are, the Petitioner was appointed as a conductor on 7-10-1983 and continued as such till 2-7-1985 when the retrenchment order was passed against him. This assertion has also been denied by the Petitioner. 4. The facts as averred in O.J.C. No. 2212 of 1988 are, the Petitioner was appointed as a conductor on 7-10-1983 and continued as such till 2-7-1985 when the retrenchment order was passed against him. As the retrenchment order was illegal he was again appointed on temporary basis on 11-10-1985 for a period of 30 days and the appointment orders were issued from time to time. The Petitioner was selected by the Divisional Selection Committee on 2-9-1987. In spite of the selection by the duly authorised committee the order of appointment was still as substitute conductor on daily wage basis. The Petitioner continued as such till he was retrenched. The notice (Annexure-6) which was issued to the Petitioner on 2-9-61988 is as follows: xx xx xx xx You are directed to note that your services did not be required with effect from 29-7-1988 (Forenoon). This may be treated as one month's notice as required u/s 25-F(a) of the I.D. Act 1947. (The annexure itself is wrong) 5. On 18-7-1988 order of retrenchment (Annexure-7) was passed and in the said retrenchment order it has been stated as follows: xx xx xx xx A s your services are no longer required with effect from 18-7-1988 (A.N.), you are allowed one month's pay in lieu of one month's notice in pursuance of Section-25F(a) of the I.D. Act, 1947. xx xx xx xx 6. On the same day also the Petitioner was relieved unilaterally in his absence. On the above facts the submission of the Petitioner is, the payment of retrenchment benefits being pre-condition to t he retrenchment order which has not been complied with, the retrenchment order is void ab initio as per the provisions of Section 25-F of the I.D. Act. 7. The stand taken by the employer is same as taken in O.J.C. No. 2211 of 1988. The Petitioners in the above two writ applications have also claimed that persons junior to them have been taken to regular service while they have been discriminated. This fact has been denied by the employer. 8. 7. The stand taken by the employer is same as taken in O.J.C. No. 2211 of 1988. The Petitioners in the above two writ applications have also claimed that persons junior to them have been taken to regular service while they have been discriminated. This fact has been denied by the employer. 8. From the rival contentions the points of law for consideration in both the writ applications are: (1) whether compliance u/s 25-F of the Act is required as the Petitioners' Services were contractual and for a specific period; (2) whether tendering or endeavour to give the compensation benefits on the part of the employer which were made impossible by the action of the workman will tantamount to compliance of Section 25-F of the Act; and (3) when there is a dispute regarding number of years of continuous service and when there was actual endeavour on the part of the employer to comply with Section 25-F of the Act, can it be adjudicated under the writ jurisdiction 9. The averment that the services of both the Petitioners were contractual and for a specific period is not disputed. The only dispute is whether the employer can take shelter u/s 2(oo), (bb) of the Act. Section 2(00), (bb) of the Act reads as follows: (oo) retrenchment means the termination by the employer of the service of a workman for any reason whatsoever, otherwise than as a punishment inflicted by way of disciplinary action, but does not include (a) xx xx xx (b) xx xx xx (bb) termination of the service of the workman as a result of the non-renewal of the contract of employment between the employer and the work-man concerned on its expiry or of such contract being terminated under a stipulation in that behalf contained therein. This provision definitely has no application to the cases at hand as the services have not been terminated as a result of non-renewal of the contract nor it has been terminated under a stipulation in that behalf. The order of retrenchment itself must show that the employer had resorted Section 2(00), (bb) of the Act. The protection u/s 2(00) (bb) of the Act is not available the employer. Moreover the termination order shows that the employer had resorted to Section 25-F of the Act. 10. The next point is whether there was violation of mandatory provisions of Section 25-F of the Act. The protection u/s 2(00) (bb) of the Act is not available the employer. Moreover the termination order shows that the employer had resorted to Section 25-F of the Act. 10. The next point is whether there was violation of mandatory provisions of Section 25-F of the Act. The admitted facts in this case are that the Petitioners were workmen and both of them have served for more than 240 days in a year. 11. Section 25-F of the Industrial Disputes Act is as follows: Conditions precedent to retrenchment of workmen No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until, (a) the workman has been given one month's notice in writing indicating the reasons for retrenchment and the period of notice has expired or the workman has been paid in lieu of such notice, wages for the period of the notice; (b) the workman has been paid at the time of retrenchment, compensation which shall be equivalent to fifteen days' average pay for every completed year of continuous service or any part thereof in excess of six months; and (c) notice in the prescribed manner is served on the appropriate Government, or such authority as may be specified by the appropriate Government by notification in the Official Gazette. 12. The settled position of law is, Section 25-F of the Act being a beneficial legislation it has to be strictly complied with and is a mandatory pre-condition. The negative form adopted by the provision, coupled with the use of the word 'until' which introduces the condition, indicates that the conditions must be first satisfied before retrenchment can be validly effected. Non-compliance of Section 25-F of the Act renders the order of retrenchment void ab initio. Taking into account all the provisions of law in ILR 1976 S.C. 1111 The State Bank of India v. Shri N. Sundara Money, their Lordships have laid down the dictum that the payment of retrenchment benefits as required u/s 25-F(2) of the Act is mandatory and pre-condition to the order of retrenchment. In absence of such compliance it has to be held that the workman continued in service though the order of appointment was for a specific period. Few of the other decisions which have laid down this principle are The State of Bombay and Others Vs. In absence of such compliance it has to be held that the workman continued in service though the order of appointment was for a specific period. Few of the other decisions which have laid down this principle are The State of Bombay and Others Vs. The Hospital Mazdoor Sabha and Others Bombay Union of Journalists and Others Vs. The State of Bombay and Another National Iron and Steel Company Ltd. and Ors. v. State of West Bengal and Anr. AIR 1967 S.C. 1206 : Hutchiah Vs. Karnataka State Road Transport Corporation. It is no more res integra that aceeptance of retrenchment benefit by the employee subsequent to the order of retrenchment will not stop the workman employee to challenge the validity of the retrenchment order on the ground of noncompliance of mandatory provisions of Section 25-F of the Act. 13. The next question is when by his own action the workman makes it impossible for the employer to comply with the mandatory provision of Section 25-F of the Act what will be the position. Occasionally it may happen that at the time of retrenchment a workman may dodge accepting compensation with a view to invalidate the retrenchment. In such a case when the workman avoid to accept the payment the employer will be in a quandary. 14. In this connection, it is relevant to examine Section 33(2)(b) of the Act which has a similar provision. According to this section, whenever a workman is discharged or punished, whether by dismissal or otherwise, the proviso makes it incumbent on the employer to pay wages for one month and make an application to the appropriate authority for approval. In Management of Delhi Transport Undertaking Vs. Industrial Tribunal, Delhi and Another. Management of Delhi Transport Undertaking Vs. Industrial Tribunal, Delhi and Another Section 33(2)(b) of the Act and the proviso thereto were considered. In that case a conductor by the Delhi Road Transport Authority was dismissed from service being found guilty. The employee was offered one month's wages before the order of dismissal become operation which he refused to receive and subsequently the said amount was sent to him by Money Order, The application for approval filed under the proviso to Section 33 (2) (b) of the Industrial Disputes Act also mentioned the above fact. The employee was offered one month's wages before the order of dismissal become operation which he refused to receive and subsequently the said amount was sent to him by Money Order, The application for approval filed under the proviso to Section 33 (2) (b) of the Industrial Disputes Act also mentioned the above fact. As one month's wages were not paid but were tendered prior to the order of dismissal, the question that arose for consideration whether there was compliance with the mandatory provisions. Their Lordships considering this facts have held: The proviso does not mean that the wages for one month should have been actually paid, because in many cases the employer can only tender the amount before the dismissal but cannot force the employee to receive the payment before dismissal becomes effective. In this case the tender was definitely made before the order of dismissal became effective and the wages would certainly have been paid if Nari Chand had asked for them. There was no failure to comply with the provision in this respect. 15. Now coming to the decisions regarding the compliance of requirements of Section 25-F of the Act. In 1964 (I) L.L.J. 525 . National Iron and Steel Company Ltd. v. Third Industrial Tribunal, West Bengal and Ors. a Single Bench of the Calcutta High Court has laid down the principle: Section 25-F no doubt says that no workman shall be retrenched 'until" he has been given either one month's notice or has been paid in lieu of. such notice, wages for the period of notice and that such workman has been paid compensation calculated u/s 25-F(b). But it may be difficult to make a workman accept payment if he will not himself do that. Therefore, an unconditional offer for payment, preceding retrenchment, may be equivalent payment. In Pepsu Transport Co. Private Ltd. Vs. State of Punjab and Others, 1968 Labour Industrial Cases 351, his Lordship has laid down the principle: He has to pay the compensation at the time of retrenchment. If the said workman does not come to receive it on or before the due date, when called upon to do so, the employer should send the same to him on that date, if possible, otherwise on the next day and it is only then that it can be said that he complied with the condition laid down in the section. In Workmen of Davangere Cotton Mills Ltd. Vs. Industrial Tribunal, Bangalore and Another, their Lordships compared the language of Section 25-F of the Act and that of the proviso to Section 33(2)(b) of the Act and have observed as follows: Now so far as the language of Section 25-F and of the proviso to Section. 33(2) is concerned, there is scarcely any distinction possib1e. Though the former uses the word "until" and the latter uses the word "unless", the effect at the ultimate meaning conveyed is the same, viz., that both refer to the necessary conditions which should be complied with, before a particular result can be achieved. We see, therefore, little reason or justification why the test for compliance or non-compliance formulated by the Supreme Court with reference to the proviso appended to Section 33(2) is not, available as a test for deter mining compliance or non compliance of Section 25-F. In 1975 Labour Industrial Cases 526, Management of M Is. Penguine Textiles Ltd. v. Labour Court, Hyderabad and Anr. his Lordship opined that the requirements contemplated by the proviso to Section 33(2)(b) of the Act are not same as there required u/s 25-F of the Act. With the following observation his Lordship held: .... I do not think that what has been said in connection with the. requirements of the proviso to Section 33(2)(b) can be said to apply with reference to the requirements of Section 25-F. Firstly the two conditions regarding payment of wages and payment of retrenchment compensation have been held to he conditions precedent to the retrenchment u/s 25-F. Secondly, while Section 33(2)(b) deals with dismissal or discharge by way of punishment Section 25-F deals with retrenchment where completely different considerations apply. Thirdly, under the proviso to Section 33(2)(b) the employees has the further protection afforded by the requirement regarding the approval of the Labour Court or the Industrial Tribunal. Merely because similar words or expressions appear in two Sections it does not follow that the principles behind and the interpretation of the two provisions should be the same. 16. In 1975 Labour Industrial Cases 526 (supra) his Lordship has taken a different view from Pepsu Transport Co. Private Ltd. Vs. State of Punjab and Others, and Workmen of Davangere Cotton Mills Ltd. Vs. Industrial Tribunal, Bangalore and Another. 16. In 1975 Labour Industrial Cases 526 (supra) his Lordship has taken a different view from Pepsu Transport Co. Private Ltd. Vs. State of Punjab and Others, and Workmen of Davangere Cotton Mills Ltd. Vs. Industrial Tribunal, Bangalore and Another. But in 1975 LabIC 526 (supra) his Lordship has not considered a case where the employee intentionally avoids to receive payment in order to make the retrenchment order inoperative. Hence the case shall not be applicable to the facts and circumstances of this case. 17. After giving anxious consideration to the mandatory provisions of law and considering the dictum laid down in the above case, in our opinion, when the payment of wages in lieu of notice and retrenchment compensation and retrenchment order can be regarded as constituting a single transaction, then the retrenchment order will not be invalid in the eye of law. One has to see whether there is such co-relation between various steps as to constitute them into a single transaction or whether the time-lag and intervening circumstances are such as to make it difficult to find out a connection. The compliance of Section 25-F(b) of the Act will be there if the payments are made simultaneously along with the order of retrenchment. The bona fide endeavour on the part of the employer to pay the compensation amount and one month's wages in lieu of notice along with the retrenchment order should be taken as due compliance where the workman avoids acceptance of compensation with a view to invalidate the order of retrenchment. The tender must be bona fide and within time. 18. In both the Cases the employer asserts that he along with the order of retrenchment if had sent the wages for one month and retrenchment compensation benefit for 45 days along with the order of retrenchment to the residence of the Petitioner as the Petitioners had left the office after coming to know that they were going to be retrenched. The Petitioners were found absent from their residence for which the retrenchment order with the retrenchment benefits could not be served upon them and was returned back to the office. Again on the next day bank drafts were drawn in the names of the Petitioners and along with the bank drafts letters were sent to the Petitioners which also returned back with the endorsement that the addressee were absent. Again on the next day bank drafts were drawn in the names of the Petitioners and along with the bank drafts letters were sent to the Petitioners which also returned back with the endorsement that the addressee were absent. The Petitioners then came to the office and filed applications that as they were absent on the date 1 when money was sent, they may be given the retrenchment benefits on that day and both of them received the money. But at the same time the Petitioners deny the fact that there was bona fide endeavour on the part of the employer to give them retrenchment benefit along with the retrenchment order. After giving our anxious consideration to the facts of these cases, we are unable to be sure as to whether there was bona fide endeavour on the part of the employer to pay one month's wages and retrenchment benefits along with the retrenchment orders or whether the employees did not receive the payment by wilfully remaining absent. Vole express no opinion on the point as to whether there was due compliance of mandatory provisions of Section 25-F of the Act or not. In our opinion, these are fit cases where adjudication should be made under the Industrial Disputes Act where evidence can be produced from both the sides and documents can be proved. 19. It is true that this Court has held in a decision reported in Beni Bhuj Sahu Vs. Chief Engineer, Hirakud Dam Project and Another, and O.J.C. No. 1554 of 1983 Rajendra Prasad Jena and Anr. v. Orissa State Electricity Board, represented through its Secretary and Ors. and other connected writ applications decided on 11-1-1989 that if the non-compliance of Section 25-F can be arrived at on the admitted fact, then the same order of retrenchment can be interfered with in a writ jurisdiction and the alternative remedy is no bar. We are at respectful agreement with this proposition of law. However, where disputed questions of facts are involved, the only forum where it can be adjudicated is the forum provided for under the Industrial Disputes Act. 20. We are at respectful agreement with this proposition of law. However, where disputed questions of facts are involved, the only forum where it can be adjudicated is the forum provided for under the Industrial Disputes Act. 20. The other two contentions raised by the Petitioners that they are entitled to payment of compensation more than what has been given and persons junior to them in service have been given regular appointment also involves disputed questions of facts, can be more appropriately decided by the adjudicating authority under the Industrial Disputes Act. Since we have already decided that the Petitioners are workmen under the Industrial Disputes Act and there exists a disputes we are sure that the appropriate authority will make a reference if the workman raises a dispute under the Industrial Disputes Act in the proper manner. The writ applications are disposed of K.P. Mohapatra, J. I agree. Ordered accordingly.