2013 Supreme(SC) 977

SUPREME COURT OF INDIA
H.L. Gokhale, Ranjan Gogoi, JJ.
State of Maharashtra & Anr. – Appellants
Versus
Sarva Shramik Sangh, Sangli & Ors. – Respondents
CIVIL APPEAL NO. 2565 OF 2006
WITH
Sarva Shramik Sangh, Sangli – Appellant
Versus
State of Maharashtra & Ors. – Respondents
CIVIL APPEAL NO.2566 OF 2006
Decided On : 21-10-2013

IMPORTANT POINT
The termination did result on account of transfer of the undertaking. Inasmuch as so many years have gone since then, there cannot be any order of reinstatement. However, they will be entitled to continuity of service, and although they have been receiving last drawn wages under S 17 B of the I.D Act, 1947, they will be entitled to 25% backwages and retirement benefits.

Headnote:Constitution of India, 1950- Article 142- To do complete justice in a matter pending before the Supreme Court- This Court has the authority to pass an appropriate order in exercise of its jurisdiction for doing complete justice in a matter pending before it. This authority under Article 142 of the Constitution will also have to be read as coupled with a duty to do complete justice in a given case. (Para 26)

        Factories Act, 1948- Section 2(k) -'manufacturing process'- Section 2(m) - "factory" - To begin with, we must note that the workmen concerned were engaged as pump operators and chowkidars etc. on 25 lift irrigation schemes, which were carrying out the process of pumping water. The process of pumping water is specifically covered under the definition of "manufacturing process" under Section 2 (k)(ii) of The Factories Act, 1948. Thus, the workmen concerned were engaged in a "manufacturing process". Once that is established, it follows that the activity of the undertaking in which they were working, constituted a "factory" within the meaning of Section 2(m) of the said Act. (Para 19)

        Industrial Disputes Act, 1947- Section 25A -'Industrial Establishment' - The explanation (i) to Section 25A of I.D. Act, 1947, covers the "factories" within the definition of an "industrial establishment", and therefore Chapter VA of the I.D. Act, 1947 applies to "manufacturing process" of pumping water. Hence, it cannot be denied that the undertaking in which the workmen concerned were employed was covered under the provisions of I.D. Act. (Para 19)

        Industrial Disputes Act, 1947- Section 25FF- Section 25FF contemplates compensation to be paid to the workmen on account of their retrenchment, resulting from transfer of the undertaking. The retrenchment, however, is required to be effected only if the previous employer is not continuing the workmen concerned in any of his activities or establishments, or when they are not being absorbed under the new employer. Continuation of service under the existing employer, or re-engagement under the new one, should be the preferred approach, when such an occasion arises. Termination of services should normally be the last resort. In the instant case, the first appellant - State Government, does not appear to have made any efforts either to absorb these workmen in other activities of the irrigation department, or to have insisted upon the sugar factory to absorb them. This is because the lift irrigation schemes were going to be continued by the transferee sugar factory, and in any case the Irrigation department has a very large number of activities, wherein these workmen could have been absorbed. When the State Government is in the picture, we do expect a little better attitude than the one which is often displayed by a private sector employer. It is possible that, in a given situation, the State Government may have its own economic compulsions which justify termination of services. But, there must be either an effort to absorb such surplus workmen, or in any case the difficulties of the Government, if any, necessitating the termination, ought to be explained. We do not find any such efforts or explanation placed on record. (Para 22)

        Industrial Disputes Act, 1947- Section 25FF- In the facts and circumstances of the present case also, accepting that the termination did result on account of transfer of the undertaking, the relief to be given to the workmen will have to be moulded to be somewhat similar to that given to the other group of 10 workmen. It will not be just and proper to restrict it to the rigours of the limited relief under Section 25FF read with 25F of the I.D. Act. Prior to the termination of their services on 30.6.1985, many of the workmen concerned had put in a service of about 10 years. Inasmuch as so many years have gone since then, most of them must have reached the age of superannuation. In the circumstances, there cannot be any order of reinstatement. However, they will be entitled to continuity of service, and although they have been receiving last drawn wages under S 17 B of the I.D Act, 1947, they will be entitled to 25% backwages and retirement benefits on par with the other 10 workmen. Award of 25% backwages in their case will be adequate compensation. (Para 27)

       Facts of the case :

        Some 256 workmen were employed to work on the irrigation schemes of the Irrigation Development Corporation of Maharashtra Limited, a Government of Maharashtra undertaking. They were served with notices of termination by the appellant No.2 on 15.5.1985. The notice sought to terminate their services w.e.f. 30.6.1985, and offered them 15 days compensation for every completed year of service. The retrenchment was being effected because according to the appellants the lift irrigation schemes, on which these workmen were working, were being transferred to a sugar factory.

       Findings of the Court :

        All the workmen will be entitled to 25% backwages over and above the last drawn wages that they have received under Section 17B of I.D. Act. The workmen of all the three categories will be entitled to continuity of service until the date of superannuation, or until the date of this judgment, or until the date on which the workman concerned has expired, as the case maybe.

       Result : Order accordingly.