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1967 Supreme(SC) 253

V.BHARGAVA, C.A.VAIDIALINGAM, M.HIDAYATULLAH
Sindhu Resettlement Corporation LTD. – Appellant
Versus
Industrial Tribunal Of Gujarat – Respondent


Advocates:
A.K.SEN GUPTA, N.H.Hingorani, R.GOPAL KRISHNAN

Judgement Key Points

The employee's services with the original employer were never terminated, as there was no formal order ending employment, no retrenchment compensation paid by the original employer at transfer, and the order merely placed services "at the disposal" of the subsidiary (a related entity), indicating deputation rather than termination, preserving the employee's lien and permanent status in the original company. (!) [1000132640002] The employee joined the subsidiary immediately after leave granted by the original employer, on higher pay but without explicit consent to end original employment, and served continuously in a group context without evidence of a new independent contract supplanting the old one. (!) [1000132640002] Confirmation in the subsidiary after probation does not automatically sever ties with the original employer absent clear mutual agreement to terminate, especially since the subsidiary appointment order was not formally proved as received or accepted as a full replacement, and strict evidence rules do not apply in Tribunal proceedings where parties relied on documents.[1000132640002] Upon retrenchment from the subsidiary (with compensation only from there), the employee promptly reported for duty to the original employer, asserting continued lien, which was refused without justification, entitling him to reinstatement and back wages as a permanent employee facing effective retrenchment without compliance. (!) (!) (!) The demand for reinstatement was explicitly raised on 21st February 1958, pursued via union representation, conciliation proceedings under the Act, and directly referenced by Government order, constituting a valid industrial dispute over non-reinstatement post-retrenchment from deputation, within Tribunal jurisdiction under relevant provisions; subsequent compensation demands were alternative reliefs, not abandonment. (!) (!) (!) [1000132640003] The Tribunal correctly directed reinstatement with back wages, as the High Court upheld, reflecting proper adjudication of the dispute's substance


Judgement

BHARGAVA, J. :- A. S. Ambwaney respondent No. 3, was employed by the Sindhu Resettlement Corporation Ltd., the appellant, as an Accounts Clerk bow Gandhidham on 13th December, 1950 in the payscale of Rs. 150-10-250 on a salary of Rs. 200 plus 20 per cent, as site allowance. This site allowance was discontinued in March, 1952. In the year 1953, the Government of India decided to develop Kandla as a port and a subsidiary company was formed by the appellant under the name of Makenzies Heinrich Bulzer (India) Ltd., in which one of the principal share-holders was the appellant. This Company later came to be known as Sindhu Hotchief (India) Ltd. For convenience, both Makenzies Heinrich Bulzer (India) Ltd. and Sindhu Hotchief (India) Ltd. shall hereinafter be referred to as "Sindhu Hotchief". This subsidiary Company, Sindhu Hotchief, wanted some trained employees and, amongst others, the services of respondent No.3 were placed at its disposal by the appellant. The case of respondent No. 3 was that he was told orally by the officers of the appellant on 2nd September, 1953 that he was to work in the subsidiary company. Respondent No. 3 was appointed in Sindhu Hotchief by its order















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