1985 Supreme(Kar) 33
Karnataka High Court
Judges : M.Rama Jois
MANAGEMENT OF RAMESH HYDROMACHS - Appellant
Versus
LABOUR COURT, HUBLI - Respondent
W. P. 20350 Of 1982
Decided On : 01/29/1985
Important Points
Subject
Labour Law - Termination and Retrenchment
Act Referred
Headnote
Termination - Labour Dispute - Compliance with Section 25-F of the Industrial Disputes Act - The court held that sending retrenchment compensation and notice pay by cheque or draft and keeping the amount ready in the office of the employer constituted sufficient compliance with Section 25-F of the Act. The court also directed the petitioner to pay a sum of Rs. 1,500 to the second respondent.
Fact of the Case:
The petitioner challenged the legality of the award made by the Labour Court, which declared the termination of the services of the second respondent as invalid and ordered reinstatement with back wages.
Finding of the Court:
The court set aside the declaration of invalid retrenchment and the direction for reinstatement, replacing it with a direction for the petitioner to pay a sum of Rs. 1,500 to the second respondent.
Issues: Validity of termination, compliance with Section 25-F of the Industrial Disputes Act, and the obligation to pay a sum to the second respondent.
Ratio Decidendi: The court held that sending retrenchment compensation and notice pay by cheque or draft and keeping the amount ready in the office of the employer constituted sufficient compliance with Section 25-F of the Act. The court also considered the second respondent's failure to collect the amount and ordered the petitioner to pay a sum of Rs. 1,500 to the second respondent.
Final Decision: The court directed the petitioner to pay a sum of Rs. 1,500 to the second respondent, and if not paid within one month, the second respondent would be at liberty to proceed to recover the same in accordance with the law.
( 2 ) THE second respondent was a workman in the service of the petitioner. He joined service as a watchman on 11th May, 1976. He was in continuous service till 24th January, 1979 on which date his services were terminated by the petitioner. The copy of the order or termination is produced as annexure-A. The relevant portion of the order reads : "it is hereby informed that from today dated 24th January, 1979, your services are no longer required and hence you have been permanently terminated. As per rules one month pay (notice pay) will be given. Similarly according to rules you are entitled for following dues as follows : rs. 1. Notice Pay 155. 00 2. leave Salary due 85. 00
( 3 ) CURRENT month's earned wages upto 23rd January, 1979 11. 75 (ESIC, PF and Advanced deduction)
( 4 ) COMPENSATION (two years service put in 155. 00 --------Total 406. 75 --------The above amount you can collect from office during office hours and can go. " 3. Aggrieved by the order of termination, the second respondent raised an industrial dispute. It was referred for industrial adjudication. Before the Labour Court the facts stated in the Statement of Objections by the petitioner to the Claim Statement of the second respondent were as follows : "the termination of service of the second respondent became inevitable consequent on reduction of post. Therefore, an order of termination dated 25th January, 1979, was prepared (the contents of which is extracted earlier) and was sought to be served on the second respondent. He did not receive it therefore it was despatched to him by registered post on next day. It was received by him on 30th January, 1979. Though the order of termination expressly stated the notice pay and retrenchment compensation payable under S. 25f (a) and (b) of the Industrial Disputes Act, 1947 (hereinafter called the "act") had been kept ready and can be collected from the office of the petitioner, the second respondent did not collect the same. Therefore, it cannot be said that the petitioner bad violated the mandatory requirement of S. 25f of the Act. The required intimation to the Government about the retrenchment had also been given. The evidence was given by the manager of the factory supported by the documents. The Labour Court accepted every one of the factual statements made on behalf of the petitioner. However, the Labour Court took the view that there was no compliance of provisions of S. 25f (a) and (b) of the act for the reason, the notice pay and retrenchment compensation had not been sent by money order and that a mere statement in the order that the said amount could be collected from the petitioner did not meet with the requirement of S. 25f (a) and (b) of the Act. Accordingly, the impugned award was made by the Labour court. " 4. The view taken by the Labour Court on the point is untenable. Section 25f does not state that retrenchment compensation and notice pay should be sent only by Money Order. If the view of the Labour Court is that money should reach by hands of the workman, then even sending a cheque or demand draft would be non-compliance of S. 25-F as the workman has to go to the bank to receive the money. Sending money, payable under S. 25-F to a workman by cheque or draft certainly amounts to compliance with S. 25-F. Similarly, keeping the amount ready in the office of the employer is sufficient compliance. In one case, he had to go to the bank, in the other to the office of the employer, to collect the money. It makes no difference. The question is also covered by a Division Bench decision of this Court in Workmen of Davangere Cotton Mills v. Industrial Tri