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2012 DIGILAW 386 (HP)

Cipla Ltd. v. State of Himachal Pradesh

2012-07-13

V.K.AHUJA

body2012
JUDGMENT : V.K. Ahuja, J. Petitioners have filed the present petition under Article 226 of the Constitution of India challenging the reference order No.11-2 of 1993 issued by respondent No.2 as well as for quashing of order dated 16.6.2009, passed by the learned Presiding Officer, Labour Court, Shimla, vide which issues were framed and the case was fixed for petitioner's evidence. 2. Briefly stated, the facts of the case leading to the filing of the present petition are that respondent No.3 was appointed as a workman on temporary basis by the petitioners on a fixed salary and allowances vide letter dated April 6, 2005. It was clearly alleged in the said letter that this appointment was on temporary basis due to temporary increase in work and the period of employment was from April 6, 2005 to October 5, 2005, as is clear from Annexure R-1. It was contained in condition No.7 that during this temporary period, the services of respondent No.3 may be terminated without any reason. Thereafter, it appears that vide letter dated October, 28, 2005 (Annexure PB), respondent No.3 was appointed as "Trainee" under "Skill Development and Training Scheme". It was stated therein that respondent No.3 will undergo training for a period of 2 years from November 7, 2005 to November 6, 2007. It was mentioned therein that on completion of this period, this training would automatically come to an end. The question of being absorbed was to be considered based on the performance during the training period and subject to availability of vacancy. Condition No.10, as contained in letter dated 28.10.2005, is reproduced as under: "10. During the training period the Company may terminate the same without assigning any reason and without notice or any compensation in lieu thereof. So also, in case you desire to discontinue the training, you may be relieved on receipt of a written request to that effect." 3. Thereafter, respondent No.3 joined on 9.11.2005, as is clear from the joining report, alleging that he could not join earlier or intimate due to unavoidable reasons. However, the services of respondent No.3 were terminated by the petitioners vide notice dated 3.2.2006 Annexure PC. It was mentioned therein that the services have been terminated as per Clause 10 of appointment letter dated 28th October, 2005, mentioned above. Respondent No.3 was also paid the balance salary vide letter dated 5th February, 2006. However, the services of respondent No.3 were terminated by the petitioners vide notice dated 3.2.2006 Annexure PC. It was mentioned therein that the services have been terminated as per Clause 10 of appointment letter dated 28th October, 2005, mentioned above. Respondent No.3 was also paid the balance salary vide letter dated 5th February, 2006. Thereafter, a demand notice was sent by respondent No.3 Annexure PF, which is undated and one demand notice was also sent through an Advocate dated 13.2.2006 Annexure PD in regard to his illegal termination. It was also alleged in the said notice that respondent No.3 was appointed as workman on temporary basis w.e.f. 6.4.2005 to 5.10.2005 and his services were terminated vide letter dated 5.10.2005. It was also mentioned therein that thereafter, the respondent was appointed as trainee for a period of two years and he had been discharging his duties, but his services were terminated and he may kindly be re-engaged for training for the period of two years. Reply to the notice was sent by the petitioners vide Annexure PE and it was mentioned therein that the initial appointment w.e.f. April 6, 2005 to October 5, 2005 was on temporary basis, which came to an end as per the terms of employment and, therefore, respondent No.3 was appointed as a trainee and his training was discontinued vide Clause 10 of the letter of appointment. 4. Thereafter, a reference was made by the private respondent to the Labour Commissioner, who passed by following order: "Whether the termination of Shri Pardeep Kumar s/o Shri Sukh Ram trainee w.e.f. 04-02-06 before completion of training period by the Managing Director, M/S Cipla Limited, Village Malpur Upper, P.O. Bhud, Tehsil Nalagarh, District Solan, H.P. without complying the provisions of the Industrial Disputes Act, 1947 is proper and justified? If not, what seniority, past service benefits and relief the concerned trainee is entitled to?" 5. Thereafter, the Labour Court proceeded with the reference, framed issues and passed the following order on 16.6.2009: "Heard. At this stage, Shri Vikas Raujput, Ld. Vice Csl. for the respondent has argued that since the petitioner was engaged as trainee, hence he is not a workman under the definition of section 2(s) of the Industrial Disputes Act, 1947 and as such the petitioner cannot maintain his claim. On the contrary, Shri Parkash Chand, Ld. At this stage, Shri Vikas Raujput, Ld. Vice Csl. for the respondent has argued that since the petitioner was engaged as trainee, hence he is not a workman under the definition of section 2(s) of the Industrial Disputes Act, 1947 and as such the petitioner cannot maintain his claim. On the contrary, Shri Parkash Chand, Ld. Csl for petitioner controverted the arguments of Shri Rajput and submitted that the respondent itself has admitted the petitioner to be a workman in its appointment letter dated 6th April, 2006 and therefore, it does not lie in the mouth of respondent to say that the petitioner is not a workman. I have scrutinised the record of the case and considered the respective contentions of both the parties. Since the status of the petitioner is to be determined on the merits of the case, hence I am of the firm opinion that this point cannot be decided without affording the opportunities to the parties to lead their evidence and as such it is premature to decide the status of the petitioner especially when the respondent itself has admitted the petitioner as workman in its appointment letter dated 6th April, 2006 and as such it is premature to express onion on the merits of the case without affording opportunities to the parties to lead evidence on this point. Accordingly, this point is disposed of being premature. Rejoinder filed. Copy given. The following issues are framed on the pleadings of the parties: 1. Whether the termination of Shri Pardeep Kumar petitioner w.e.f. 4.2.2008 before completion of training period by the Managing Director M/s Cipla Ltd. Village Malpur Upper, P.O. Bhud Tehsil Nalagarh, Distt.Solan without complying with the Industrial Disputes Act, 1947 is improper and unjustified as alleged? OPP 2. If issue no.1 is proved to what seniority, past service benefits and relief the petitioner is entitled to? OPP 3. Whether the petitioner is not a workman as alleged? OPR 4. Whether the claim is hopelessly time barred? OPD 5. Whether this court has no jurisdiction to try this case as alleged? OPR 6. Relief. No other issue arises nor claimed. Issues are read over and explained to the parties. Now to come up for petitioner's evidence on taking steps for 16.7.2009." 6. OPR 4. Whether the claim is hopelessly time barred? OPD 5. Whether this court has no jurisdiction to try this case as alleged? OPR 6. Relief. No other issue arises nor claimed. Issues are read over and explained to the parties. Now to come up for petitioner's evidence on taking steps for 16.7.2009." 6. The submissions made by the learned counsel for the petitioners were that the appointment of respondent No.3 initially was on contractual basis which came to an end on October 5, 2005, which was not challenged by him at any time. Thereafter, the appointment was as a trainee and respondent No.3 was to be considered for regular appointment on completion of successful training and subject to availability of vacancy and respondent No.3 himself admitted that he was appointed as a trainee. It was urged that a trainee cannot be termed as a workman to attract the provisions of the Industrial Disputes Act and as such the reference made by the Labour Commissioner and the cognizance taken by the Labour Court cannot be said to be legal. During the course of arguments, the learned Senior Advocate for the petitioners had made a reference to some of the letters written by respondent No.3 himself, namely, Annexure PS, dated 11.11.2005 and Annexure PT dated 12.1.2006, which clearly suggest that respondent No.3 had absented himself from duty from 2.1.2006 to 7.1.2006 as well as on 31.12.2005 and keeping in view the conduct of respondent No.3 in which he had himself admitted about his absence, without holding an inquiry, the petitioners passed an order that respondent No.3 had not successfully completed the training and, therefore, his services were dispensed with. 7. Further submissions made by the learned Senior Advocate for the petitioners were that since respondent No.3 was a trainee and his services were dispensed with and he was not a workman, no reference could have been made to the Labour Court and accordingly the impugned orders are liable to be quashed by this Court exercising the writ jurisdiction. 8. To substantiate his submissions, the learned Senior Advocate for the petitioners had relied upon the decision in Vijayalakshmi Insecticides and Pesticides Limited, Hyderabad v. Chairman Industrial Tribunal-cum-Labour Court, Visakhapatnam and others, 2003 (8) SLR 55. 8. To substantiate his submissions, the learned Senior Advocate for the petitioners had relied upon the decision in Vijayalakshmi Insecticides and Pesticides Limited, Hyderabad v. Chairman Industrial Tribunal-cum-Labour Court, Visakhapatnam and others, 2003 (8) SLR 55. A perusal of the judgment passed shows that in para 9, it was observed that is not in dispute that all the persons were trainees and the period was extended but ultimately their services being found unsatisfactory had been terminated. It was held that it does not amount to retrenchment. Trainees cannot be said to be workmen and the order of the Industrial Tribunal directing their absorption was held to be bad in law. 9. Reliance was also placed upon the decision in National Small Industries Corpn. Ltd. v. V. Lakshminarayanan, (2007) 1 SCC 214 , in which it was held in para 24 that the reasoning of the Labour Court was not correct that the respondent was not an apprentice trainee but was a workman, who was made to perform full time job. In Para 25 in regard to contractual appointment, it was observed as under: "25. Even if it is accepted that the respondent was a workman within the meaning of the 1947 Act, on account of his contractual tenure, his case would come within the exception of clause (bb) of Section 2(oo) thereof. In such a case also, the provisions of Section 25-F of the said Act would have no application to the respondent's case." 10. Reliance was also placed upon the decision in Municipal Council, Samrala v. Raj Kumar, (2006) 3 SCC 81 , in which it was held that first part of Section 2(oo)(bb) contemplates termination of service on non-renewal of the contract of employment or its expiry. However, second part of Section 2(oo)(bb) postulates termination of such contract or employment in terms of stipulation contained in that behalf. It was held that the case clearly fell under second part of Section 2(oo)(bb) and the Labour Court and the High Court erroneously proceeded on the basis that the case fell under first part of Section 2(oo)(bb) and accordingly it was held that the respondent was not appointed on a permanent or temporary basis and the appeal filed by the Municipal Council was allowed accordingly. 11. Another decision relied upon was in Rajasthan State Road Transport Corporation and another v. Charan Singh, (2007) 15 SCC 789 . 11. Another decision relied upon was in Rajasthan State Road Transport Corporation and another v. Charan Singh, (2007) 15 SCC 789 . The observations made in para 6 are relevant and are being reproduced below: "Further, the law is well settled that in cases of temporary employees, that too those who are appointed on ad hoc basis their services can be put to an end if the same are not satisfactory on examination of the total service record. If termination of services is as on that basis, no inquiry need be held. If that is so, all the courts have gone at tangent and have decided the matter on irrelevant facts, therefore, the orders made by the High Court affirming the orders of the trial court and the first appellate court shall stand set aside and the suit filed by the respondent shall stand dismissed." 12. Reliance was also placed upon the decision in Kalyani Sharp India Ltd. v. Labour Court No.1, Gwalior and Another, (2002) 9 SCC 655 , in which the following observations were made in paras 5 and 6: "5. So far as the first contention raised on behalf of the respondent is concerned, we may state that the argument emerges from the documents which the respondent has relied upon before the Labour Court to show about his employment and the termination of his service. No fresh investigation of facts is required. It is a case of simple application of law in the matter. Hence the preliminary objection is rejected. 6. The order of employment itself clearly sets out the terms thereafter which makes it clear that the facility of providing training to him could be put to an end at any time without assigning any reason whatsoever and his services could be regularised only on satisfactory completion of his training. If these clauses are read together, it is clear he was under probation during the relevant time and if his services are not satisfactory, the same could be put an end to. It is clear that the respondent had been appointed as a Trainee Service Technician and for a period he had to undergo the training to the satisfaction of the appellant and if his work was not satisfactory during that period the facility could be withdrawn at any time and he would be regularised only on completion of his training. It is clear that the respondent had been appointed as a Trainee Service Technician and for a period he had to undergo the training to the satisfaction of the appellant and if his work was not satisfactory during that period the facility could be withdrawn at any time and he would be regularised only on completion of his training. Thus the respondent's services were terminated before expiry of the probationary period. In such a case, question of issue of notice before terminating the service as claimed by the respondent does not arise. Escorts case is identical with the present case. Following the said decision and for the reasons stated therein there appeals are allowed. The order made by the High Court affirming the award made by the Labour Court is set aside and the claim made by the respondent is dismissed." 13. On the other hand, the submissions made by the learned Assistant Advocate General were that the question to be decided was as to whether respondent No.3 was a workman or trainee, which question has to be determined by the Labour Court and as such the present writ petition does not lie against the framing of issues by the Labour Court or in regard to the reference made by the Labour Commissioner. In support of his submissions, reliance was placed upon the decision in Trambak Rubber Industries Ltd. v. Nashik Workers Union and others, (2003) 6 SCC 416 . The observations made in para 4 are relevant and are being reproduced below: "4. The core question before the Industrial Court as well as the High Court was whether the persons whose engagement was terminated were the employees within the meaning of Section 3 (5) of the Act read with Section 2(s) of the Industrial Disputes Act. The Industrial Court upheld the plea of the management that they were trainees. In recording the conclusion that they were trainees, the Industrial Court adverted to two factors: (1) Neither the complainant Union nor the management had placed on record the appointment letters that would have been issued when the persons concerned were recruited in 1988. (2) On the complainant Union's own showing, the management started issuing appointment letters appointing them as trainees only after 23-6-1989, which itself would negative the case of the Union that they were employed as labourers. (2) On the complainant Union's own showing, the management started issuing appointment letters appointing them as trainees only after 23-6-1989, which itself would negative the case of the Union that they were employed as labourers. The learned Presiding Officer of the Industrial Court then observed thus: "I may say that merely because the trainees were employed for performing regular nature of work, would not by itself make them workmen." Then the court observed that a trainee is not equivalent to a workman "unless there is sufficient evidence of existence or employer-employee relationship". The Industrial Court ultimately held that the management's action terminating the training programme resulting in their unemployment from 14-8-1989 cannot confer on them the right to resume work and claim back wages." 14. On the other hand, the submissions made by the learned counsel for respondent No.3 were that the order passed by the Labour Commissioner making reference to the Labour Court was an administrative order, which could not be challenged in a writ of certiorari as filed by the petitioners. It was also submitted that an order of reference cannot be challenged and the final order passed by the Labour Court only can be challenged. 15. To substantiate his point, the learned counsel for respondent No.3 placed reliance upon the decision in The State of Madras v. C.P. Sarathy and another, A.I.R. 1953 SC 53. The observations made in para 14 were relied upon, which is reproduced below: "Though it is desirable that the Government should, wherever possible, indicate the nature of the dispute in the order of reference, it must be remembered that in making a reference under Section 10 (1) the Government is doing an administrative act and the fact that it has to form an opinion as to the factual existence of an industrial dispute as a preliminary step to the discharge of its function does not make it any the less administrative in character. The Court cannot, therefore, canvass the order of reference closely to see if there was any material before the Government to support conclusion, as if it was a judicial or quasi-judicial determination. No doubt, it will be open to a party seeking to impugn the resulting award to show that what was referred by the Government was not an industrial dispute within the meaning of the Act, and that, therefore, the Tribunal had no jurisdiction to make the award. No doubt, it will be open to a party seeking to impugn the resulting award to show that what was referred by the Government was not an industrial dispute within the meaning of the Act, and that, therefore, the Tribunal had no jurisdiction to make the award. But, if the dispute was an industrial dispute as defined in the Act, its factual existence and the expediency of making a reference in the circumstances of a particular case are matters entirely for the Government to decide upon, and it will not be competent for the Court to hold the reference bad and quash the proceedings for want of jurisdiction merely because there was, in its opinion, no material before the Government on which it could have come to an affirmative conclusion on those matters." 16. Another decision relied upon was in Paramount Films of India Ltd., Madras Branch, AIR 1957 Madras 615, in which the following observations were made in para 2: "An order under Section 10 (1)(c) of the Industrial Disputes Act is only administrative in its scope and is therefore outside the purview of correction by the issue of a writ of certiorari. There cannot be a writ of prohibition either directed to the Industrial Tribunal. The person seeking to avoid the reference on the ground that there is no dispute at all for adjudication has to take it up even as a preliminary issue for decision by the Tribunal itself. If the Industrial Tribunal arrives at a wrong decision, the aggrieved person will be entitled to challenge the validity of such a decision by an application for the issue of a writ of certiorari." 17. On the above point that no writ of certiorari lies, the learned Senior Advocate for the petitioners had submitted that it was not only an administrative order passed by the Labour Commissioner, but it was a quasi judicial reference and a party cannot be compelled to stand the trial before a Labour Court in case the order passed is not proper or in accordance with law. 18. 18. It was further submitted by the learned Senior Advocate for the petitioners that the decision in State of Madras v. C.P. Sarathy and another (supra) was given by their Lordships on 5th December, 1952 and was not applicable to the present case since the Industrial Disputes Act had already been amended by Act No.43 of 1953 w.e.f. 24.10.1953. Accordingly, it was submitted that Section 2(bb) was added and the term retrenchment reads as under: "Section 2(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 - (bb) termination of service of the workman as a result of the non-renewal of the contract of employment between the employer and the workman concerned on its expiry or of such contract being terminated under a stipulation in that behalf contained therein;" 19. These amendments were effected w.e.f. 24.10.1953 and w.e.f. 18.8.1984 and, therefore, in case there was 'retrenchment' as a result of non-renewal of contract of the employment, it will not be covered by the term 'retrenchment' within the meaning the of the Act. 20. To substantiate his plea that a party cannot be compelled to stand trial before the Labour Court, the learned Senior Advocate for the petitioners had reiterated his submissions made earlier and had also relied upon the decision in Kalyani Sharp India Ltd. (supra) and the observations made in para 5 of the said decision, which have been reproduced above. It was also submitted that no fresh investigation of facts is required and it is a question of simple application of law in the matter and the order can be said to be quasi-judicial. 21. The submissions made by learned counsel for respondent No.3 as well as by learned Assistant Advocate General appear to be attractive but I am afraid that these cannot be accepted for the reasons given herein. The reference made by the Labour Commissioner to the Labour Court was as to whether the termination of Pardeep Kumar before completion of training period by the petitioners without complying with the provisions of the Industrial Disputes Act, 1947 is improper and unjustified. The necessary document to be considered by the Labour Commissioner was the order of appointment of respondent No.3 as a trainee. The necessary document to be considered by the Labour Commissioner was the order of appointment of respondent No.3 as a trainee. The said letter was considered and accordingly, the reference was made as to whether the termination of respondent No.3 as a trainee without complying with the provisions of the Industrial Disputes Act was proper or not. It is, therefore, clear that the relevant document was the appointment letter vide which respondent No.3 was appointed as a trainee. There was no other material on record before the Labour Commissioner except the letter of appointment vide which respondent No.3 was appointed as a trainee. Respondent No.3 himself had admitted in his first demand notice that he was appointed as a trainee and thereafter in the subsequent notice, he was mentioned as a worker and the prayer made in the notice issued through a counsel was that the training period be restored and he be appointed afresh as a trainee for two years. There was no challenge at any time to the earlier order vide which his temporary employment came to an end. The said termination order could have been challenged, but it was never challenged by respondent No.3 at any time. He only challenged his termination order as a trainee and the cause of action had arisen to him earlier, but he made no reference for referring the matter to the Labour Court, but was aggrieved only when an order was passed dispensing with his services as a trainee. Once this fact is prima facie clear to the Labour Commissioner that respondent No.3 was a trainee and he has referred the matter as to whether provisions of Industrial Disputes Act were attracted or not, the Labour Commissioner had not made the reference to the Labour Court to determine the question as to whether respondent No.3 was or was not a workman. Accordingly, onus was placed upon the present petitioners to show that the respondent was not a workman, though in the order of reference, this question was never referred to the Labour Court. Once the Labour Commissioner, prima facie, observed that the respondent was a trainee, but had not referred the question as to whether he was a workman and entitled to protection under the Industrial Disputes Act, 1947, determination of this question does not lie within the purview of the Labour Court. Once the Labour Commissioner, prima facie, observed that the respondent was a trainee, but had not referred the question as to whether he was a workman and entitled to protection under the Industrial Disputes Act, 1947, determination of this question does not lie within the purview of the Labour Court. Once, it is held, prima facie, that respondent No.3 was a trainee, he cannot be termed as a workman in view of the above decision and is not entitled to any protection under the Industrial Disputes Act and once during the training period his work has not been found satisfactory, his services can be terminated under Clause 10 of the appointment letter, referred to above. Moreover, once the question as to whether respondent No.3 was a workman or not was not referred to the Labour Court, it was not within the jurisdiction of the Labour Court to determine this question by framing issues and, therefore, the order of reference cannot be said to be proper since there was no reference to determine the question if the respondent was a workman and accordingly the framing of issues by the Labour Court cannot be said to be proper. Once it was prima facie clear that respondent No.3 was a trainee, therefore, no fresh investigation of facts was required, in such a matter, as per the decision in Kalyani Sharp India Ltd. (supra), it cannot be termed as a purely administrative order and even if it was an administrative order, which could not be challenged by way of a writ of certiorari, but the order passed was defective since it had never referred the question to the Labour Court if respondent No.3 was a workman or not. Once there was no reference in this regard, the Labour Court could not have proceeded to determine this question and this question mainly had to be determined only on the basis of the appointment letter, which was relied upon by the Labour Commissioner and, therefore, reference can be termed as defective, which can be set aside by exercising the writ jurisdiction. It is not necessary that the parties should be compelled to face trial before the Labour Court to determine this question, once the Labour Commissioner himself had observed and made a reference that the respondent was a trainee and a trainee is not entitled to protection under the Industrial Disputes Act, 1947 since he is not a workman. 22. In view of the above detailed discussion, I hold that the writ petition deserves to be allowed and the same is allowed accordingly. The order of reference passed by the Labour Commissioner is quashed and consequently the proceedings pending before the Labour Court are also quashed. There are no orders as to costs. 23. The petition stands disposed of accordingly, so also the pending application(s), if any.