Gram Sewa Sahkari Samiti Jhadisa Limited v. Madho Lal Sharma
2017-12-05
SANJEEV PRAKASH SHARMA
body2017
DigiLaw.ai
JUDGMENT : Sanjeev Prakash Sharma, J. The challenge is to the award dated 28.5.2001. Counsel for the petitioner raised two fold submissions. Firstly, the workman was not appointed legally and if he has continued for more than 240 days and the Management found that appointment was not legal, the removal cannot be said to be unjustified and illegal. The second submission is that while passing order of removal, the compliance was made of Section 25F(a) & (b) of the Act of 1947, as while giving notice and compensation amount which was released was amount paid after adjusting the amount of Rs. 1800/-. There were dues of the said workman to the tune of Rs. 1800/- and therefore the amount of compensation was to be adjusted in lieu of the dues and thus the actual amount of compensation which accrued to the workman was not required to be tendered along with notice and notice pay. 2. Learned counsel for the respondent submits that the Labour Court has examined both the submissions and has relied on the law laid down in "Utkal Asbestos Ltd. v. T.S. Rao and Anr.": 1991(62)FLR 972 which relied upon the judgment of Supreme Court in "State of Bombay v. Hospital Mazdoor Sabha": 1960 AIR(SC)610 to answer that the provision of Section 25F(a) & (b) were mandatory and the amount due against the workman could not be adjusted while giving notice under Section 25F and the compensation under Section 25F. 3. Learned counsel for the petitioner relies on judgment of Bombay High Court in the case of "Engineering and Ancillary Manufacturers v. Salim Khan: 2004(2)CLR 309, wherein it was held as under: "11. It is also not possible for me to accept the contention of Shri Ganguli that the employer cannot adjust the loan amount received by the workman while in employment. In the present case Petitioner had offered the legal dues and had adjusted the amount of Rs. 4600/- which was advanced by the Petitioner to the workman. I do not find any illegality or impropriety in recovering the amount of loan given by the employer to the workman. In the present case the loan amount is admitted by the workman, it cannot be said that after severance of the employer employee relationship the employer should be required to chase the workman to recover the loan amount by filing civil litigation.
In the present case the loan amount is admitted by the workman, it cannot be said that after severance of the employer employee relationship the employer should be required to chase the workman to recover the loan amount by filing civil litigation. In my opinion the Petitioner employer was fully justified in adjusting the loan amount at the time of parting company with the Respondent workman. By no stretch of imagination it can be said that by adjusting loan amount there is infraction or breach of Section 25F of the Act. It was merely a give and take transaction. The Petitioner had offered the amount and therefore had received the loan amount back from the Respondent workman. On paper the adjustment is reflected to safeguard the interest of the workman that the repaid the loan amount. It therefore do not find any illegality in the act on the part of the Petitioner in adjusting the loan amount from the legal dues of the respondent." 4. I have heard both the counsels. In the case of Utkal(supra), following has been noted in para 8: - "8. In view of the language of the aforesaid provisions there cannot be any manner of doubt that it is incumbent upon the employer to fulfil the requirements of Clauses (a) and (b) of Section 25- F and that where those provisions are not satisfied, the retrenchment effected by the employer would be illegal. It has been so held by the Supreme Court in the case of State of Bombay v. Hospital Mazdoor Sabha AIR 1960 S.C. 610 : (1960) I LLJ 251 Section 25-F has been held to be a warning poster and the requirements of Clauses (a) and (b) have to be complied with at the time of termination of service and constitutes the condition precedent to validly retrench a workman. The language of the provisions is so imperative in nature that where a workman was asked to collect his dues afterwards it was held by the Supreme Court in the case of National Iron and Steel Company Ltd. and Ors. v. State of West Bengal and Anr. 1964 (14) F.L.R. 356 : 1967(2) LLJ 23 that there has been no compliance of Sections 25-F(a)and 25- F(b) of the Act. Following this decision in Tamil Nadu Transports case, it was held that subsequent payment of retrenchment compensation cannot validate retrenchment.
v. State of West Bengal and Anr. 1964 (14) F.L.R. 356 : 1967(2) LLJ 23 that there has been no compliance of Sections 25-F(a)and 25- F(b) of the Act. Following this decision in Tamil Nadu Transports case, it was held that subsequent payment of retrenchment compensation cannot validate retrenchment. Logically therefore, the notice-pay and retrenchment compensation have to be paid in full on or before the dale effecting termination of service and it is not possible for the employer to make any adjustment of any disputed past dues. But the question that arises is whether the position would be different when the dues are admitted. The Allahabad High Court in the case of Panchoo Gopal Karmakar & Sons. v. State of Uttar Pradesh and Ors. 1979 I LLN 359, construing Section 6-N of the Uttar Pradesh Industrial Disputes Act which is in pari materia with Section 25-F of the Central Act came to hold that there is no provision of law which militates against acceptance of payment by adjustment as equivalent of payment, where an outstanding debt is unequivocally admitted. It was also held that in ordinary parlance payment means, either actual payment in cash or otherwise including settlement of a debt and the word "paid" should be liberally construed so as to include notional payment where the facts are not disputed. The aforesaid decision of the Allahabad High Court no doubt fully supports the contention of Sri Das, learned counsel for the petitioner. But in view of the legislative intent behind Sections 25-F(a) and 25-(b) of the Act and the language used therein, as well as interpretation of those provisions by the Supreme Court and other High Courts, we are in respectful disagreement with the views expressed by the learned judges of the Allahabad High Court and we are not in a position to accept the submission of Sri Das that the adjustment of admitted dues is permissible while examining whether the conditions precedent provided in Sections 25-F(a) and 25-F(b) have been satisfied or not. The conditions in Clauses (a) and (b) of Section 25-F are categoric imperatives and those conditions must be fully complied with before effecting the retrenchment or the termination.
The conditions in Clauses (a) and (b) of Section 25-F are categoric imperatives and those conditions must be fully complied with before effecting the retrenchment or the termination. The sole object of giving a month's notice in writing or payment of wages for the period of notice in lieu of the notice as well as the compensation determined in accordance with Clause(b) is that the workman will not be a destitute and will not be forced to be on the street on termination of his service. Such an object would be frustrated if adjustment of the dues is permitted. In the premises as aforesaid, we do not find any error of law apparent on the face of the order of the Tribunal in recording the conclusion that there has been no compliance of Sections 25-F(a)and 24-F(b) of the Act." In "State of Bombay (supra)1960 AIR(SC)610, it was held as under: "6. Now, turning to the first point, it may be stated that the facts on which the respondents' plea is based are not in dispute. It is conceded that the services of respondents 2 and 3 have been retrenched though it may be for the purpose of making room for other Government servants with a longer record of service who had to be retrenched owing to the closure of the appellant's Civil Supplies Department. It is also not disputed that the said respondents had not been paid at the time of retrenchment compensation as prescribed by section 25F(b). The respondents' contention is that the failure to comply with the said requirement makes the order of retrenchment invalid. This plea has been upheld by the Court of Appeal. Section 25F(b) provides that no workman employed in any industry who has been in continuous service for not less than one year under an employer until he has retrenched by that employer until he has been paid at the time of retrenchment compensation which shall be equivalent to fifteen days' average pay for every completed year of service or any part thereof in excess of six months. Clauses (a) and (c) of the said section prescribe similar conditions but we are not concerned with them. On a plain reading of section 25F (b) it is clear that the requirement prescribed by it is a condition precedent for the retrenchment of the workman.
Clauses (a) and (c) of the said section prescribe similar conditions but we are not concerned with them. On a plain reading of section 25F (b) it is clear that the requirement prescribed by it is a condition precedent for the retrenchment of the workman. The section provides that no workman shall be retrenched until the condition in question has been satisfied. It is difficult to accede to the argument that when the section imposes in mandatory terms a condition precedent, non-compliance with the said condition would not render the impugned retrenchment invalid. The argument which appealed to Tendolkar, J., however, was that the consequence of non-compliance with the requirement of section 25F(b) was not to render the impugned retrenchment invalid, because be thought that by Section 25-1 a specific provision has been made for the recovery of the amount prescribed by section 25F (b). Section 25-provides for the recovery of monies due from employers under Ch. V, and according to Tendolkor J. this provision covers the amount due to the workman by way of compensation under section 25F (b). In our opinion, this view is untenable. Having regard to the fact that the words used in section 25F (b) are mandatory and their effect is plain and unambiguous it seems to us that the Court of Appeal was right in holding that section 251 covered cases of recover of ninnies other than those specified in section 25F (b), an it is obvious that there are several other cases in which monies become due from the employers to the employees under Ch. V; it is for the recovery of the monies that section 251-1 had been enacted. Therefore, we see no substance in the argument that the Court of Appeal has misconstrued section 25F That being so failure to comply with the said provision renders the impugned orders invalid and inoperative" 5. The view taken in Utkal(supra) has not been considered nor the judgment of the Supreme Court has been considered by the Bombay High Court. Hence the said view of Bombay High Court is per-incuriam. 6. In view thereof, I find that the award passed by the Labour Court does not call for any interference where there has been non compliance of provision of 25F. The award therefore is upheld. 7. The writ petition is accordingly dismissed.