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2023 Supreme(Ori) 215
IN THE HIGH COURT OF ORISSA
Arindam Sinha, J.
General Manager, The Samaja, Buxi Bazar - Appellant
Versus
Santosh Kumar Muduli - Respondent
W.P.(C) No. 35177 of 2023
Decided On : 08-11-2023
Mr. Biplab P. B. Bahali, Advocate, for the Appellant; Mr. Bibhu Prasad Panda, Advocate, for the Respondent.
IMPORTANT POINT
The termination of a workman's contract upon its expiry does not constitute retrenchment under the Industrial Disputes Act if the contract terms explicitly state that the engagement ends automatically without renewal.
Headnote:
LABOUR LAW - TERMINATION OF EMPLOYMENT - INDUSTRIAL DISPUTES ACT, 1947; WORKING JOURNALISTS AND OTHER NEWSPAPER EMPLOYEES (CONDITIONS OF SERVICE) AND MISCELLANEOUS PROVISIONS ACT, 1955 - The court analyzed the termination of the workman's contract under the Industrial Disputes Act, 1947, particularly Section 25-F, which outlines the conditions for retrenchment. The court found that the workman's contract had expired and was not renewed, thus the termination did not constitute retrenchment under the Act. The court also considered the Working Journalists Act but concluded that the workman was not covered by it. The decision emphasized the importance of contract terms and the implications of automatic termination upon expiry.
Fact of the Case:
The petitioner challenged the award of the labour court which found the termination of the workman, Santosh Kumar Muduli, illegal and unjustified, ordering reinstatement and back wages. The management argued that the workman's contract had expired and was not renewed, while the workman claimed he was entitled to protections under the Industrial Disputes Act due to continuous service.
Finding of the Court:
The court found that the workman had admitted to the renewal of his contract until 31st March 2014, and the management's termination was valid as the contract had automatically expired. The court concluded that the termination did not amount to retrenchment under the Industrial Disputes Act, as the workman was not in continuous service beyond the contract period.
Issues: Whether the termination of the workman's employment constituted retrenchment under the Industrial Disputes Act, and whether the workman was entitled to protections under the Act given the nature of his contractual engagement.
Ratio Decidendi: The court held that the automatic termination of the workman's contract upon expiry did not constitute retrenchment as defined under the Industrial Disputes Act. The workman's continued service beyond the contract period did not create a new employment relationship, and thus the protections afforded by the Act were not applicable.
Final Decision: The court set aside the labour court's award, ruling that the termination was legal and justified, and allowed the writ petition.
JUDGMENT
Arindam Sinha, J.
Mr. Bahali, learned advocate appears on behalf of petitioner (management). He submits, impugned is award dated 30th June, 2023 made by the labour Court, illegally and with material irregularities in finding that termination of opposite party (workman) by not renewing the contract was neither legal nor justified. Consequently, direction for reinstatement and payment of back wages at 30% are also to be set aside and quashed.
2. He draws attention to the contract, under which opposite party was appointed. It is dated 1st March, 2012. We reproduce below clauses 1, 2 and 9.
'1. The period of contract will be for a period of one year from the date of your joining.
2. During the period of contract apart from the consolidated amount of Rs.10,000/- no other allowance or financial benefit will be admissible to you except the allowances towards fuel and mobile.
xxx xxx xxx
9. On expiry of contractual period, your contract of engagement shall stand automatically terminated.' (emphasis supplied)
He submits, the contract was extended to subsist between 1st April, 2013 till 31st March, 2014. By office order dated 7th April, 2014 it was said that the contract had expired as not renewed. Text of the office order is reproduced below.
'Annual Contract of Sri Santosh Kumar Muduli, who is at present working as 'Reporter' in Balasore Edition has been expired since 31st March 2014 and the same is not renewed.
Thus, Sri Muduli is no longer attached with 'The Samaja'.
This Order comes into force with immediate effect.' (emphasis supplied)
3. Mr. Bahali submits, opposite party at trial could not dispute above facts. In the circumstances, finding in the award that there had been retrenchment without following provisions in, inter alia, section 25-F in Industrial Disputes Act, 1947 is perverse. Without prejudice he submits, the workman cannot claim to be covered by the Act of 1947, as he is covered by provisions in Working Journalists and Other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955.
4. Mr. Panda, learned advocate appears on behalf of opposite party (workman). He submits, there was no renewal of the contract upon its automatic expiry on 31st March, 2013. In the circumstances, his client having been allowed to continue to work in absence of contract, became a workman entitled to the protection and benefits under the Act of 1947. He submits further, facts are similar to the case decided by this Bench on judgment dated 9th October, 2023 in WP(C) no. 23655 of 2015 (Sri Chinmaya Prasad Rout v. Presiding Officer, Labour Court, Bhubaneswar and others). He relies on paragraph 8, reproduced below.
'8. To adjudicate the challenge we have to first ascertain the facts. We have seen petitioner had obtained contractual engagement. The notice clearly says that the period of engagement was one year and extendable, subject to requirement and performance. On petitioner having been engaged there were two communications made to him, respectively dated 12th February, 2009 and 18th May, 2009 extending his period of engagement up to 31st October, 2009. What is important is that petitioner had an order of engagement and thereafter extensions limiting the time up to 31st October, 2009. In the circumstances, as on 1st November, 2009 the cause for the management arose to not renew the contract. It appears from the record that the management purported to terminate the engagement by writing dated 6th November, 2010 saying that the engagement period expired on 30th October, 2010. It emerges that on 1st November, 2009 there was no disengagement. We, as aforesaid, have not been shown that petitioner was communicated any extension beyond 31st October, 2009. The facts standing thus, first part of clause (bb) as interpreted in Raj Kumar (supra) cannot be availed by the management in having disengaged petitioner one year later.'
5. Regarding contention of his client being covered by the Act of 1955, Mr. Panda draws attention to the
