Lahar Associates (Contractor) v. Bathibhai Shakrabhai Sodha
2019-12-12
SONIA GOKANI
body2019
DigiLaw.ai
JUDGMENT : 1. The entire group of petitions since contain identical questions of law and facts, they are being decided by common judgment. The facts are drawn from Special Civil Application No.20281 of 2018 for the purpose of adjudication. 2. The petitioner is a partner of a firm which is duly registered under the Partnership Act. It is a contractor registered under the provisions of Contract Labour (Regulation and Abolition) Act, 1970 ('the Contract Labour Act' hereinafter) which is aggrieved by the judgment and award passed by the learned Presiding Officer, Labour Court, Nadiad in Reference (LCN) No.268 of 2000 passed on 02.01.2018 and published on 19.02.2018. 3. The petitioner firm which is registered under the provisions of the Bombay Shops and Establishment Act, 1948 deploys the workmen in different establishment on the basis of the contract with the second respondent-company. It had entered into the contact for the work of loading and unloading of the products and carrying out work for which the department pays the duty of warehouse. The petitioner also employed in about 141 workmen for the said contract, 32 of them had been engaged as supervisors. They were deployed on the basis of the contract dated 01.03.1998 as per the terms and conditions of the contract. The workmen employed by the petitioner were to be supervised and controlled by the supervisor. On expiry of the contract dated 01.03.1998, fresh contracts were executed on 31.07.1999 and 31.12.2000 containing the similar conditions. 4. Second respondent-company decided to end the contract of providing supervision and clerical staff for their DPG/POP stores. As a result of which 32 employees engaged for that work could not be continued as they were rendered excess. The petitioner resorted to retrenchment of 32 employees on 11.07.2001. Under Rule 80 of the Industrial Dispute (Gujarat) Rules 1966 necessary information had been sent to the Secretary of the Labour and Employment Department of the State Government. 4.1 According to the petitioner, while resorting to the retrenchment of these 32 employees, the amount of retrenchment compensation, one month's notice pay, due salary, the amount of gratuity, privilege leave salary, bonus as well as the difference in the salary had been paid delayed. Thus, all legal dues till the date of retrenchment had been paid and the employees chose not to accept the amount of legal dues initially, but later on, they had accepted the said amount.
Thus, all legal dues till the date of retrenchment had been paid and the employees chose not to accept the amount of legal dues initially, but later on, they had accepted the said amount. Thus, it is quite obvious from the material on the record that the respondent-employees have been terminated from the services after their payment of legal dues as contemplated under the Law. 5. It appears that the first respondent filed statement of claim after the matter referred to the concerned authority for the purpose of conciliation failed in Reference (LCN) No.268 of 2000 before the Presiding Officer, Labour Court, Nadiad. 5.1 It was claimed that the termination of service was illegal and the respondent-workman was entitled to reinstate on full back wages and continuity of service. 6. Respondent No.2-company also filed its written statement contesting the claim of the first respondent. The petitioner also filed its written statement denying the entire claim and also having put forth the ground of having paid fully the total and full amount. 7. The parties were permitted to adduce the evidence and present their respective cases giving the fullest opportunities to both the sides. The learned Presiding Officer by its award and order dated 02.01.2018 published on 19.02.2018 partly allowed the reference and directed the petitioner to pay amount of Rs.1,50,000/- to the respondent No.1 and Rs.1,31,708/- to the respondent No.1 of Reference (LCN) No.13 of 2000, Special Civil Application No.20330 of 2018 within a period of 60 days of publication of the award, failing which the amount would be carrying the interest at the rate of 9% per annum. This has aggrieved the petitioner, who is before this Court seeking to challenge the said award. 8. According to the petitioner, learned Presiding Officer committed serious error of jurisdiction which has resulted into gross injustice to the petitioner. It is further his case that it materially erred in partly allowing the reference because the first respondent had not been regular workman of the petitioner-company. There was no proof on the record that he completed 240 days. He could not have raised industrial dispute claiming that the termination was bad in law. 9. The petitioner has insisted that since to all workmen, retrenchment benefits have already been paid by the petitioner, there is no reason for the petitioner to pay the amount of lumpsum compensation as directed by the Labour Court, Naidad.
He could not have raised industrial dispute claiming that the termination was bad in law. 9. The petitioner has insisted that since to all workmen, retrenchment benefits have already been paid by the petitioner, there is no reason for the petitioner to pay the amount of lumpsum compensation as directed by the Labour Court, Naidad. 10. This Court had issued the notice to the other side and also on 21.12.2018 and granted ad interim relief in terms of paragraph No.6 (C) in favour of the present petitioner and it is during the pendency of this petition, there is already a stay granted on the operation, execution and the implementation of the award of the Labour Court, Nadiad which is impugned in the said petition. 11. Likewise, in other petitions also the Labour Court, Nadiad has granted lumpsum compensation of Rs.1,50,000/- and Rs.1,31,708/- to respondent No.1 of Special Civil Application No.20330 of 2018 and by way of an interim relief this Court has granted the stay in favour of the petitioner. 12. In respond to the said notice, respondent No.1 is represented by the learned advocate, Mr. Sailesh Sharma, whereas respondent No.2 is represented by the Nanavati Associates and respondent No.4 is the Labour Contract, who is served for having refused, no body represents him. 13. This Court has heard extensively the learned senior advocate, Mr. Gautam Joshi appearing with learned advocate Mr. I.G. Joshi for the petitioners, who has fervently urged before this Court that the Presiding Officer has completely ignored the fact that the respondent No.1 is not a regular workman of the petitioner-company. The initial onus is always upon the workman to prove that he has completed 240 days in a given year with company. However, as can be noticed from the material on the record the industrial dispute which has been raised claiming the termination was bad in law and itself is not maintainable. There is no proof with regard to the work of 240 days and moreover, the employee was engaged for supervisory work when his service ended. The Presiding Officer, Labour Court, Nadiad failed to establish that the first respondent was falling within the definition of workman, moreover the contract of the petitioner since terminated in 2013-2014, the Court ought not to have granted any relief, much less, compensation in lieu of the reinstatement.
The Presiding Officer, Labour Court, Nadiad failed to establish that the first respondent was falling within the definition of workman, moreover the contract of the petitioner since terminated in 2013-2014, the Court ought not to have granted any relief, much less, compensation in lieu of the reinstatement. The case was of the closure of the establishment of the petitioner. No amount of compensation therefore, could have been allowed. He also has pointed out that this is the group of petitions wherein in the account of each workmen, the amount of retrenchment compensation and other legal dues have been given. However, he fairly submits on scrutinizing record that in case of this group of petitions, no amount has been paid towards the retrenchment compensation or in lieu of the notice or any other legal dues. 14. Learned advocate, Mr. Sailesh Shah appearing for respondent No.1 in each matters has strenuously made his submissions and urged that the contract was with the petitioner, who admittedly had worked for the principal employer, which is respondent No.2 herein. Admittedly, no amount has been paid to respondent No.1 and the order of termination therefore, is bad in law. The Trial Court after availing the opportunities to both the sides had rightly and emphatically held that the termination was bad in law. However, the Court instead of granting reinstatement has chosen to grant lumpsum compensation bearing in mind the end of the contract of the present petitioner firm with respondent No.2. It is stuck a balance and no interference is desirable even otherwise there no ground existing for this Court to interference in its jurisdiction under Articles 226 and 227 of the Constitution of India. 15. Learned advocate appearing for Nanavati Associates for respondent No.2 has urged that the company has nothing to do with the entire dispute as it had given the contract to the petitioner, which has ended in the year 2013-2014. If at all there is any legal liability, it will be of the petitioner and accordingly the Court below has directed the compensation to be given to respondent No.1. 16. Having thus heard the learned advocate on both the sides and also having noticed, the reference also was not to find out as to whether the contract was bogus therefore, from the very beginning the genuineness of the contract was not questioned. 17.
16. Having thus heard the learned advocate on both the sides and also having noticed, the reference also was not to find out as to whether the contract was bogus therefore, from the very beginning the genuineness of the contract was not questioned. 17. At the outset, this Court agrees with the contention raised by respondent No.2 that there was no contention with regard to the contract being sham and bogus. It is from the beginning the contention on the part of respondent No.1 is that the petitioner was the actual and principal employer and he had worked under the petitioner. The petitioner had given a contract with respondent No.2 for sorting-out different bottles of brands such as limca, coco-cola, thumbs-up, etc. The work is of perennial nature and for which the petitioner and others were engaged. 17.1 Before the Labour Court, Nadiad in the written statement the present petitioner had admitted the partnership firm, which was established in 1997. It deals with supplying man power to the respondent-Company. As per the contract, the petitioner was allocating the work of supervisory nature, payment of salary, appointing workman, etc. Respondent No.2 had demanded more man power for some temporary work and after once that was over, the contract was terminated. Respondent No.1 since was not a permanent employee and it was for a temporary period that from him, work was taken, the dispute itself according to the petitioner is raised with a mala fide intent. 17.2 The contractor, who has been next given the contract has chosen not to remain present before the Labour Court and even before this Court. 17.3 The written statement of respondent No.2 had indicated that it had no relationship of employer and employee with respondent No.1. The termination of service has nothing to do with respondent No.2. The company had issued the contract with the petitioner for loading, unloading, housekeeping, labour supplying, etc. such type of work supervised by the supervisor of the contractor and the salary was also paid by the contractor, the company has no relationship with respondent No.1. 18. The Court after taking into consideration the rival contentions and averments, framed the issue as to whether the termination was illegal and whether the relief of reinstatement and other reliefs were necessary or not. The Labour Court, Nadiad having held in favour of respondent No.1 that the termination was illegal.
18. The Court after taking into consideration the rival contentions and averments, framed the issue as to whether the termination was illegal and whether the relief of reinstatement and other reliefs were necessary or not. The Labour Court, Nadiad having held in favour of respondent No.1 that the termination was illegal. Instead of granting the relief of reinstatement with back wages and continuity of service granted the lumpsum compensation of Rs.1,50,000/- and in Reference (L.C.N.) No.13 of 2002 granted the lumpsum compensation of Rs.1,31,708/-. According to the Labour Court, respondent No.1 was a daily wager, his services came to be terminated in the year 2000. If such services were not terminated as the contract had continued upto 2013-2014, he could have worked till then. The age of respondent No.1 at the time of termination and his age at the time of deciding the reference was also considered. The Labour Court, Nadiad also took note of the possible rights and essential commodities and other factors. The only because the contract of respondent No.1 had not continued beyond 2013-2014, the Court deemed it appropriate to award the compensation to the workman by way of a lumpsum compensation. 19. It is needed to be noted that while so doing it, the Court has also taken note of various decisions to hold that the contract cannot terminate the services of the employees without depositing any amount of retrenchment compensation or any amount in lieu of the notice pay or other wise by not paying any legal dues in favour of respondent No.1. 20. As can be noticed from the material on the record and the detailed discussion, which has taken place with the clear admission on the part of the respondent through their learned senior advocate that no retrenchment compensation has been made available in favour of respondent No.1, this Court is of the opinion that this is a clear breach of Section 25 F of the I.D.Act. For the profitable reference is reproduced herein below: “25F. Conditions precedent to retrenchment of workmen.
For the profitable reference is reproduced herein below: “25F. 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 b [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 appropriate Government by notification in the Official Gazette.” 21. It is clear from the said provision that the services of the workmen employed on a daily wage basis, when it is terminated and if has worked for 240 days during the preceding twelve months on daily wager, such person shall not be retrenched by the employer until he has been given one month's notice in writing indicating the reasons of 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 and 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 also the notice in the prescribed manner is served on an appropriate Government. Section 25 (F) of the I.D. Act, thus, lays down the conditions precedent to retrenchment of workman and requires every employer to follow. The giving of notice can also be to the appropriate Government or prescribed authority over and above the paying of one month's notice in writing or one month's wages in lieu of the notice with payment of retrenchment compensation to the concerned workman.
The giving of notice can also be to the appropriate Government or prescribed authority over and above the paying of one month's notice in writing or one month's wages in lieu of the notice with payment of retrenchment compensation to the concerned workman. Since none of this has been followed and there is a clear breach noticed as held by the Trial Court, its subsequent order of not to reinstate in wake of the closure in the year 2013-2014 and grant of lumpsum amount in lieu of this order of retrenchment deserves no interference. 22. Resultantly, all the petitions are dismissed. The judgment and award dated 02.01.2018 passed by the learned Presiding Officer, Labour Court, Nadiad in Reference (LCN) No.268 of 2000 is confirmed. The petitioner is directed to pay the amount of lumpsum compensation as stipulated by the Labour Court, Nadiad to the respondent No.1 in each matter with the interest as stipulated by the Labour Court, Naidad and with further interest upto the date of payment within a period of four weeks from the date of receipt of the writ of this judgment. No order as to cost.