1. Appeal against reinstatement order of workmen terminated from contractual collection work — Compliance with statutory retrenchment provisions challenged. (Para 1 , 2 , 4 , 10 )
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2026 Supreme(Raj) 588
HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR
INDERJEET SINGH, ASHOK KUMAR JAIN, JJ.
Managing Director, The Urban Cooperative Bank Limited - Appellant
Versus
The Judge, Industrial Tribunal, Jaipur - Respondent
D.B. Special Appeal Writ No. 751 of 2017
Decided On : 16-03-2026
Advocates Appeared:
For the Appellant :Mr. A.K. Sharma, Senior Advocate with Mr. Madhav Dadhich
For the Respondent: Mr. K.C. Chandel (Self), present in person
For the Appellant :Mr. A.K. Sharma, Senior Advocate with Mr. Madhav Dadhich
For the Respondent: Mr. K.C. Chandel (Self), present in person
Reinstatement is not an automatic consequence of an invalid termination. Courts may grant lump sum compensation instead, considering the duration of service, nature of employment, and the time elapsed since termination, especially when workmen have attained the age of superannuation.
Headnote:(A) Industrial Disputes Act, 1947 - Sections 25F, 25G, 25H and 25N - Constitution of India - Articles 226 and 227 - Termination of services - Scope of interference by High Court in Industrial Tribunal awards - Reinstatement vs. Lump sum compensation - The supervisory jurisdiction of the High Court under Articles 226 and 227 is confined to ensuring the tribunal acted within its parameters and is not to correct errors of law or re-weigh evidence unless the award is based on no evidence or is perverse (Paras 33, 36, 37).
(B) Industrial Disputes Act, 1947 - Reinstatement as a remedy - Reinstatement is not an automatic consequence of a termination order being declared bad or contrary to statutory provisions. The court must consider the duration of service, nature of employment, and the time elapsed since termination while determining the appropriate relief. Where a significant period (e.g., over 20-30 years) has lapsed and the workmen have attained the age of superannuation, monetary compensation may be granted instead of reinstatement (Paras 41, 42, 44, 49).
Facts of the case:
Services of several workmen engaged for a specific contractual project were terminated in 1982. After a prolonged legal battle involving multiple awards and remands, the Industrial Tribunal eventually declared the terminations unfair and illegal due to non-compliance with statutory provisions regarding the "last come first go" rule and preference in re-employment, ordering reinstatement with back wages. The employer challenged the award, asserting that the workmen were contractual employees and that statutory compensation had been paid.
Findings of Court:
The court found that the Single Judge correctly determined that the award of the Industrial Tribunal was not perverse. However, the court observed that because the dispute originated in 1982, the workmen had not worked for the employer for decades and had since reached the age of superannuation, making the order of reinstatement impractical.
Issues: 1. Whether the High Court should interfere with the findings of the Industrial Tribunal under Articles 226 and 227 of the Constitution. 2. Whether reinstatement is the mandatory remedy when a termination is declared illegal after a lapse of several decades.
Ratio Decidendi: While the supervisory jurisdiction of the High Court is limited to correcting patent illegalities or perversity and cannot be used to re-appreciate factual evidence, the remedy for an illegal termination is not limited to reinstatement. Given the nature of the employment and the extraordinary delay in the finalization of the award, the interest of justice is served by awarding lump sum compensation rather than reinstating employees who have already retired by age.
Result: Special Appeal Writ partly allowed; the award is modified to substitute reinstatement with a lump sum compensation of Rs. 5,00,000/- for each workman.
Legal Category Hierarchy
Table of Contents
2. Employer argued termination due to contract end, compliance with Section 25F; workmen alleged non-compliance of Sections 25G, 25H, 25N. (Para 13 , 14 , 15 , 16 , 17 , 18 , 19 )
3. Supervisory jurisdiction under Article 226 limited to perversity or patent illegality; not to reappreciate evidence. Reinstatement not automatic after long delay. (Para 33 , 34 , 35 , 36 , 37 , 38 , 41 , 42 , 43 , 44 , 45 )
4. When termination is illegal, reinstatement is not automatic; compensation may be awarded considering service duration, nature of employment, and time lapsed. (Para 41 , 42 , 43 , 44 )
5. Appeal partly allowed; reinstatement modified to lump sum compensation; rest of award upheld. (Para 51 , 52 )
6. What is the scope of High Court's interference under Articles 226 and 227 of the Constitution with an award of the Industrial Tribunal?
Interference is limited to cases of patent illegality or perversity; the High Court cannot re-appreciate evidence or act as an appellate court. (Para 33 , 35 , 36 , 37 , 38 )
7. Is reinstatement an automatic remedy when termination is found illegal under the Industrial Disputes Act?
No, reinstatement is not automatic. Courts may grant monetary compensation considering duration of service, nature of employment, and time lapsed since termination. (Para 41 , 42 , 43 , 44 )
8. What is required to establish violation of Section 25H (re-employment of retrenched workmen) of the Industrial Disputes Act?
The workman must prove he was retrenched and that the employer decided to fill up subsequent vacancies. (Para 25 )
9. Can the Industrial Tribunal adjudicate issues not referred to it under the Industrial Disputes Act?
No, the Tribunal is bound by the terms of reference and cannot adjudicate issues that have not been referred to it. (Para 29 , 30 )
10. What factors are considered when determining compensation in lieu of reinstatement for workmen after a long lapse of time?
Courts consider length of service, time since termination, workmen attaining superannuation, and their settlement in other employment. (Para 45 , 46 , 47 , 48 , 49 )
JUDGMENT :
1. Instant DB Special Appeal under Rule 134 of the RAJASTHAN HIGH COURT RULES , 1952 has been filed by the appellant, (hereinafter referred to as "the employer"), aggrieved from the judgment dated 10.03.2017 passed in SB Civil Writ Petition No.1959/2006, titled as "Managing Director, Urban Cooperative Bank Ltd. vs. Judge, Industrial Tribunal, Jaipur".
2. The brief facts of the case are that the Respondent No.2, an Organization of Rajasthan Cooperative Sector Employees Union submitted a demand charter to the employer on 18.02.1982 and after that services of the some of the members of Union were terminated and they were discontinued by present appellant from 01.09.1982. A dispute was raised and after failure in conciliation, a reference was made by the State Government under Section 10A of the Industrial Disputes Act, 1947, (hereinafter referred to as "the Act of 1947"), as under:
"Whether the action of the employer Managing Director, Urban Cooperative Bank Limited, Nehru Bazar, in terminating the services of 30 workmen mentioned in the list was justified and correct, and if not, what relief they were entitled to?"
3. A statement of claim was filed by the respondent union on behalf of 15 out of 30 workmen in respect of whom the dispute was raised. Five other workmen had filed separate statement of claims. A reply was filed by the appellant employer.
4. The Industrial Tribunal answered the reference on 01.04.1991 by holding that the termination order was legal and justified and the termination order did not fall within the definition of retrenchment and was covered under Section 2(oo)(bb) of the Act of 1947.
5. One of the workmen, Trilok Chand, separately challenged his termination and an award was passed in his favour on 22.08.1989 by the Industrial Tribunal, thus declaring termination as unfair and illegal.
6. Two separate writ petitions were filed, firstly S.B. CWP No.3956/1991 by the workmen against the award dated 01.04.1991, and secondly S.B. CWP No.3048/1990 by the employer against the award in favour of Trilok Chand dated 22.08.1989.
7. A Coordinate Bench of this Court allowed both the writ petitions on 22.04.1994 and set aside the awards dated 01.04.1991 and 22.08.1989 and remitted the matter back to the Industrial Tribunal to decide the same afresh.
8. The Tribunal, while reconsidering the reference, decided the same on 16.10.1995 and passed an award against the workmen. Respondent No.2 again filed S.B. CWP No.3698/1996 against the said award and, vide judgment dated 05.01.1999, a Coordinate Bench of this Court again set aside the award dated 16.10.1995 and remanded the matter back to the Tribunal.
9. A D.B. Special Appeal (Writ) No.123/1995 was preferred by the employer bank and the same was decided on 24.11.2003 observing that some of the issues were not dealt with by the learned Single Judge.
10. Thereafter, SB Civil Review No.30/2004 was preferred by the appellant employer bank, which was dismissed on 27.01.2005. Finally, the award dated 19.07.2005 was passed by the Industrial Tribunal in following manner:
11. In view of award, termination of 17 workmen was declared as unfair and illegal and they were reinstated with back wages and continuity of service. Against the said award, the bank employer appellant herein, preferred S.B. CWP No.1959/2006, which was dismissed on 10.03.2017 with cost of Rs. 50,000/- to be paid by the employer bank and be distributed equally to the workmen who are members of the respondent union.
12. The instant SAW has been preferred and the same is being considered on merits.
13. Learned Senior Advocate appearing on behalf of the employer bank submitted that on two occasions a reference was decided in favour of the appellant bank, but after the remand by this Hon'ble Court a fresh award in favour of workmen was passed by the Tribunal. He further submitted that the Tribunal in its findings has clearly held that the appellant bank (employer) has complied with the mandatory provisions of Section 2
