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2025 Supreme(Ker) 2516

IN THE HIGH COURT OF KERALA AT ERNAKULAM
S.Manu, J.
Smitha Francis Alias Smitha Ajay – Petitioner
Versus
Shwas Homes Private Limited And Ors. – Respondents
IA.No.1/2024 IN WP(C) No. 10576 OF 2024
Decided On : 18-07-2025

Advocates Appeared:
For the Petitioner: M/S. M.M.Fathima Jaleena, K.A.Hazan, V.J.James, K.P.Wilson & Ramesh Kumar K.
For the Respondent:M/S. B. Ashok Shenoy, P.S.Gireesh, Salih P.A., Arjun R Naik, Thejalakshmi R.S. & Umasanker U.U., Advocates

Self-employment constitutes 'employment' under Section 17B of the Industrial Disputes Act, and relief can be denied if self-employment proves sufficient income.

Headnote:(A) Industrial Disputes Act, 1947 - Section 17B - Denial of employment - Labour Court's award declaring denial of employment as unjustified and illegal, directing reinstatement and awarding back wages - Petitioner claimed financial distress due to alleged lack of employment; management countered with evidence of petitioner operating two profitable businesses - Court concluded that self-employment is included within 'employment' under Section 17B, and findings suggested petitioner was not deserving of relief, given evidence of sufficient income from businesses. (Paras 7, 10, 13-16)

(B) Evidence Disclosure - Duty of parties to disclose all relevant facts in pleadings; failure to disclose significant income-generating activity considered suppression of facts, undermining claims for relief. (Paras 10, 14)

Facts of the case:
The petitioner, a workman, sought relief under Section 17B claiming inability to work since 2011 after a management denial. The Labour Court’s award for reinstatement and back wages was ignored by management.

Findings of Court:
The court upheld that self-employment could negate entitlement to relief under Section 17B if proven adequately remunerating, and noted the petitioner had a duty to fully disclose financial circumstances relevant to claims.

Issues: Whether self-employment falls within the definition of 'employment' for the context of Section 17B; if the petitioner had sufficient financial resources to deny relief.

Ratio Decidendi: The court reasoned that self-employment in income-generating activities does constitute employment for the purposes of Section 17B; also emphasized the duty to disclose all pertinent facts in legal proceedings.

Result: Application under Section 17B rejected.

Table of Content
1. denial of employment and labour court award. (Para 2 , 3 , 4)
2. counterarguments regarding petitioner's business income. (Para 5 , 6)
3. arguments for and against relief under section 17b. (Para 7 , 8 , 9)
4. interpretation of employment in section 17b. (Para 10 , 11)
5. self-employment as employment under section 17b. (Para 12 , 13 , 14 , 15 , 16)

ORDER :

S.MANU, J.

This interim application has been filed by the 2nd respondent in the writ petition under Section 17B of the Industrial Disputes Act.

2. Petitioner in this I.A. is the workman in I.D.No.14/2017 of the Labour Court, Ernakulam. Denial of employment by the writ petitioner was the issue. On 07.03.2022, the Labour Court passed an award finding that the denial of employment was unjustified and illegal. Petitioner was directed to be reinstated with continuity of service. 50% of backwages with 7% interest from 17.09.2011 was also awarded.

3. The writ petitioner management did not honour the award. Petitioner filed C.P.No.77/2022 under Section 33C(2) of the Industrial Disputes Act before the Labour Court. Later, she filed C.P.No.51/2023 which was allowed by order dated 29.11.2023. The Labour Court held that the petitioner is entitled to recover an amount of Rs.4,06,619/- from the management for the period from 01.04.2022 to 31.07.2023.

4. In the affidavit accompanying this I.A., the petitioner has stated that she has been out of employment since 17.09.2011. She stated that she could not find any employment and had no means of livelihood from any other job, gainfully or otherwise.

5. The writ petitioner filed counter affidavit in this I.A. The contention in the counter affidavit mainly is that the petitioner started her own establishment, a women's cloths shop and designer boutique under the name and style “Marlin Wardrobe” at Eroor in 2015. Copy of the license dated 26.05.2022 issued by the Tripunithura Municipality for the establishment and some other documents have been produced along with the counter affidavit. The writ petitioner contends that the petitioner in the above IA is getting profit of more than Rs.1,00,000/- per month and hence she is not entitled for the benefit under Section 17B. The writ petitioner later filed an additional counter affidavit in which it has been stated that in addition to the above mentioned establishment, the petitioner was running another establishment under the name and style 'Saga, The Craft People'. It is contended that the petitioner is earning profit of more than Rs.5,00,000/- from the said establishment. A copy of the consent to operate issued to the factory by the Kerala State Pollution Control Board and some other documents have been produced along with the additional counter affidavit.

6. The petitioner filed reply affidavit refuting the contentions in the counter affidavit and the additional counter affidavit. Petitioner states in the reply affidavit that the business of 'Saga, The Craft People' was run by the family and not by her alone. It being a family concern, the profit of the said concern cannot be considered as her earning. She further states that 'Marlin's Wardrobe' is a tailoring establishment started in 2018 and on account of continuous loss it is in the verge of closure. Crux of the contentions raised in the reply affidavit is that though two business establishments were started, the petitioner is not earning sufficient income and hence the same cannot be considered as a reason for denying the relief under Section 17B of the Industrial Disputes Act.

7. Learned counsel appearing for the workman relied on various judgments of the Hon'ble Supreme Court, this Court as well as of the Delhi High Court. He relied on the following judgments:-

1. Jayaraman v. Quilon Gas Service [ 1995 SCC OnLine Ker 358 ].

2. Regional Authority,Dena Bank and Ors v. Ghanshyam [ (2001) 5 SCC 169 ].

3. Birdhi Chand Naunag Ram Jain v. P.O., Labour Court No.IV and Ors. [2003 SCC OnLine Del 1188].

4. Lourdes Hospital v. State of Kerala. [2022

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