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2009 Supreme(SC) 404

Supreme Court of India
THE HONOURABLE MR. JUSTICE TARUN CHATTERJEE & THE HONOURABLE MR. JUSTICE H.L. DATTU
M/s. P.V.K. Distillery Ltd.
Versus
Mahendra Ram
Civil Appeal No.1349 Of 2009 (Arising out of SLP(C) No. 595 of 2008)
Date of Judgment : 02-03-2009

Advocates appeared:
For the Appellant :-----For the Respondent: -----

Headnote:Industrial Disputes Act, 1947, Sections 11-A and 17-B - Reinstatement - Full back-wages - Relief granted to the respondent – Directed reinstatement with continuity of service and full employment benefits and back wages Appellants factory declared sick and remained closed for many years and had been assigned to new management – Grant of full back wages – Not justified - Fair and reasonable to direct the new employer to deposit 50% of back wages by way of arrears of back wages.

Judgment :

Leave granted in the special leave petition.

1) This appeal is directed against the judgment and order passed by the High Court of Judicature at Allahabad in Civil Miscellaneous Writ Petition No. 32250 of 1990 dated 21.5.2007.

2) The facts in nutshell are as follows: the respondent, Mahendra Ram, was recruited on casual basis some time in the year 1981 in M/s P.V.K. Distillery Ltd. (now rechristened as Lords Distillery Ltd.). On 14.8.1982 he was shifted to bottling section as a permanent workman by the orders of the General Manager. On 19.1.1985 services of the respondent were terminated by an oral order from the employer. Aggrieved by the said order, respondent went before the Labour Court inter-alia alleging that he was employed in the establishment of the employer and that his services were terminated orally in an unjustifiable and illegal manner. Appellants on the other hand contended, that, respondent was engaged by Gaya Singh Yadav, contractor and therefore respondent was never in their employment and thus master-servant relationship never existed between them.

3) Labour Court after considering and appreciating the oral and documentary evidence on record, has come to the conclusion, that, the respondent, Mahendra Ram, was in the continuous employment of the establishment since 1980 and the employer unjustifiably and illegally terminated workmans services from 19.1.1985. The labour court has also come to the conclusion that the respondent-workman has worked for more than 240 days in a calendar year, as required by section 25B(2) (a) of Industrial Disputes Act, 1947, and therefore he is entitled for reinstatement with continuity of service and full employment benefits and back wages.

4) In the interregnum, the appellants factory remained closed for years together and ultimately it was declared as a sick unit. Management of the company was substituted with the present management for its rehabilitation/reconstruction.

5) Appellant then went before the High Court challenging the validity and legality of the award by which the workman has been reinstated with continuity of service and full employment benefits and back wages. By the impugned order, the High Court has stated that there is no reason to doubt the findings given by the Labour Court and declined to interfere with the award passed by the Labour Court in Adj. Case N0. 32/87. Aggrieved by the said order, appellant is before us by this special leave petition.

6) Notice was ordered to be issued to the respondent on 25.1.2008. The order reads:

"Issue notice to the limited to the question of 50% back wages".

7) Pursuant to the order passed by this Court, notice was issued to the respondent to the address furnished in his claim statement filed before the Labour Court. Since the same was returned unserved, the Registrar of this Court on 7.8.2008 ordered that two weeks time is granted to the appellant to file application for substituted service. Learned counsel for the appellant on 20.8.08 filed an application for substituted service by way of publication in the newspaper. In spite of such publication, the respondent has not appeared before this court either in person or through his learned counsel. Therefore we are deciding this appeal after hearing the learned counsel for the appellant.

8) In the instant appeal, the Labour Court on appreciation of evidence on record has rendered a finding that there exists a master-servant relationship between the employer i.e. appellant and Mahendra Ram.

9) Section 11A of Industrial Disputes Act gives power to the Labour Courts to give appropriate relief in case of discharge and dismissal of a workman in exceptional circumstances. Labour Court after appreciating the facts and evidence on record has rightly held that services of respondent have been unjustifiably and illegally terminated by the appellant without complying with the procedure prescribed in Section 6-N of the U.P. Industrial Disputes Act, and accordingly has directed
















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