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1993 Supreme(Guj) 312

Gujarat High Court
Judgename :B.J.Shethna, R.A.MEHTA
GRAM PANCHAYAT,damnagar - Appellant
Versus
SHARADKUMAR D.ACHARYA - Respondent
S.C.A.3048 of 1989
Decided On : 08/17/1993

Advocates Appeared: G.M.JOSHI, Y.V.SHAH

Headnote:Industrial Disputes Act, 1947 - Secs. 2(oo) & 25 F - Expression `retrenchment in Sec. 2(oo) - Covers every case of termination except those embodied in definition itself - Discharge of petitioner from Service after expiry of period of probation amounts to retrenchment and attract provision of Sec. 25F - Non-compliance with provision of S. 25F renders termination void.

       Sec. 2(oo) covers every case of termination of service except those which have been embodied in the definition and, therefore, discharge from employment or termination of service of a probationer, would also amount to retrenchment and compliance with the requirements of S.25-F in the case of such termination is essential and necessary consequence of non-compliance with S.25-F would render the termination void. Therefore, the first contention must fail.

       [Para 4]

       Insdustrial Disputes Act, 1947 - Secs. 25B (2) and 25 (B)(2)(a) - Continuous Service for a period of 12 months or one year - Scope & applicability - Though workman not in continuous service for the full one year but stands covered under deeming provision contained in Sub-sec. (2) of Sec. 25-B - He has actually worked for more than 240 days in the proceding 12 calendar months - Workman entitled to retrenchment compensation.

       It is true that the workman had not been in continuous service for a period of full 12 months or one year and in fact his service was of about 9 months only. However the deeming provision of sub-section(2) of Section 25-B is applicable in the present case, which provides that a workman shall be deemed to be in continuous service for a period of one year, if the workman, during the period of twelve calendar months preceding the date of termination, has actually worked under the employer for not less than 240 days. In the present case, the workman has worked for more than 240 days in the preceding 12 calendar months and, therefore, he is deemed to be in continuous service for a period of one year and, therefore, retrenchment compensation was payable

       [Para 5]

       Industrial Dispute Act, 1947 - Sec. 25 F - Termination of service as a measure of economy - Compliance of S. 25F necessary - Termination in the instant case without fulfilling requirements of Sec. 25F illegal & void - Reinstatement if necessary by creation of post.

       It is true that the Panchayat had abolished the post as a measure of economy and terminated the services of the workman. However, the Panchayat did not fulfill the requirements of S.25F and, therefore, termination is illegal and void and he has to be reinstated and, if necessary, the post has to be re-created to comply with the order of reinstatement. It is not open to an employer to contend that since the employer had abolished the post, the orders of reinstatements could not be complied with. It would amount to giving licence to the employer to illegally terminate the service and to render the Court helpless in granting reinstatement. That would be perpetuating illegality and injustice.

       [Para 6]

       Service & Employment - Reinstatement - Back wages - Admissibility - Once it is held that the condition precedent to order termination of service not followed - Workman entitled to reinstatement with back wages - Poor economic condition of employer is not of any avail.

       Once it is held that the condition precedent has not been followed, the termination is void and ineffective and the workman is deemed to be continuing in service and entitled to backwages. The reason given of poor economic condition of the employer is not substantiated actually and is not of any avail legally.

       [Para 7]

R. A. MEHTA, J.

( 1 ) THE petitioner-Gram Panchayat is aggrieved by the judgment and award of the Labour Court granting reinstatement with backwages to the respondent-workman.

( 2 ) THE Labour Court has held that the action of termination of the services of the respondent was retrenchment and condition precedent laid down in Sec. 25f of the Industrial Disputes Act, 1947 had not been followed and, therefore, the termination was illegal and void.

( 3 ) THE learned Counsel for the petitioner-Panchayat submitted that the workman was on probation and, therefore, termination of service within the probation period would not amount to retrenchment as defined in Sec. 2 (oo) of the I. D. Act. Secondly it was submitted that the petitioner had not completed one year of continuous service and, therefore, no retrenchment compensation was payable and, therefore, the condition precedent was not applicable in the present case. Thirdly, it was submitted that the post, which the petitioner was occupying, has been abolished as a measure of economy and, therefore, reinstatement could not have been ordered And fourthly it was submitted that having regard to the poor financial condition of the petitioner- gram Panchayat, the award for backwages should not have been passed.

( 4 ) THE first contention is concluded by the Supreme Court in the case of Karnataka S. R. T. Corpn. v. M. Boraiah, 1984 (1) SCC 244, wherein it has been held that Sec. 2 (oo) covers every case of termination of service except those which have been embodied in the definition and, therefore, discharge from employment or termination of service of a probationer, would also amount to retrenchment and compliance with the requirements of Sec. 25f in the case of such termination is essential and necessary consequence of non-compliance with Sec. 25f would render the termination void. Therefore, the first contention must fail.

( 5 ) THE second contention is also covered by the provision of Sec. 25b (2) (a) of the I. D. Act, as held by the Supreme Court in the case of digyadih Colliery v. Workmen, AIR 1966 SC 75. It is true that the workman had not been in continuous service for a period of full 12 months or one year and in fact his service was of about 9 months only. However, the deeming provision of sub-sec. (2) of Sec. 25b is applicable in the present case, which provides that a workman shall be deemed to be in continuous service for a period of one year, if the workman, during the period of twelve calendar months preceding the date of termination, has actually worked under the employer for not less than 240 days. In the present case, the workman has worked for more than 240 days in the preceding 12 calendar months and, therefore, he is deemed to be in continuous service for a period of one year and, therefore, retrenchment compensation was payable and it is admittedly not paid. Second contention also, therefore, must fail.

( 6 ) THIRDLY, it is submitted that the post has been abolished and, therefore, reinstatement could not have been granted. It is true that the panchayat had abolished the post as a measure of economy and terminated the services of the workmen. However, the Panchayat did not fulfil the requirements of Sec. 25f and, therefore, termination is illegal and void and he has to be reinstated and, if necessary, the post has to be re-created to comply with the order of reinstatement. It is not open to an employer to contend that since the employer had abolished the post, the order of reinstatement could not be complied with. It would amount to giving licence to the employer to illegally terminate the services and to render the Court helpless in granting reinstatement. That would be perpetuating illegality and injustice. Therefore, petitioners third contentions has no merit.

( 7 ) LASTLY, it was submitted that because of the precarious financial condition of the Panchayat, the backwages should not have been awarded. Once it is held that the condition precedent has not been foll















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