1. Employee transferred under contract — failure to report for duty — termination of service — complaint alleging mala fide transfer as unfair labour practice under MRTU & PULP Act. (Para 3 , 4 )
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2020 Supreme(SC) 34
SUPREME COURT OF INDIA
L. NAGESWARA RAO, HEMANT GUPTA, JJ.
Rajneesh Khajuria – Appellant
Versus
M/s. Wockhardt Ltd. & Anr. – Respondents
Civil Appeal No. 8989 of 2019 (Arising Out Of SLP (Civil) No. 6692 of 2015)
Decided on : 15-01-2020
Important Points
IMPORTANT POINTS
Order issued and sent out to employee concerned must be held to have been served notwithstanding when he actually received it.
Allegation of transfer order as an act of unfair labour practice without impleading the person who is said to have acted in a mala fide manner is not sustainable.
Complaints relating to unfair labour practices fall within the jurisdiction of the Labour Court.
Order issued and sent out to employee concerned must be held to have been served notwithstanding when he actually received it.
Allegation of transfer order as an act of unfair labour practice without impleading the person who is said to have acted in a mala fide manner is not sustainable.
Complaints relating to unfair labour practices fall within the jurisdiction of the Labour Court.
Subject
Labour Law - Unfair Labour Practices
Act Referred
INDUSTRIAL DISPUTES ACT: S.2(s)
MAHARASHTRA RECOGNITION OF TRADE UNIONS AND PREVENTION OF UNFAIR LABOUR PRACTICES ACT: Item.3, Sch.4, S.3(5), S.7, S.32
MAHARASHTRA RECOGNITION OF TRADE UNIONS AND PREVENTION OF UNFAIR LABOUR PRACTICES ACT: Item.3, Sch.4, S.3(5), S.7, S.32
Headnote
(a) Procedural law - Service of order - Order issued and sent out to employee concerned - Must be held to have been served notwithstanding when he actually received it. (Para 12)
(b) Service law - Transfer and termination letters issued and sent out - Employee claiming termination order to be fake on his assertion that he never received it - Assertion irrelevant. (Para 13)
(c) Service law - Transfer - Assertion of mala fide - Employer has power of transfer and transfer by itself cannot be said to be an act of unfair labour practice - No malice in law - Therefore mala fide complained must have an element of personal bias or an oblique motive - The person against whom mala fide is complained must be impleaded - Instantly appellant alleging transfer order as an act of unfair labour practice without impleading the person who is said to have acted in a mala fide manner - Allegation not sustainable. (Para 20)
(d) Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 - Section 7 r/w Item 1 of Schedule IV - Complaints relating to unfair labour practices fall within the jurisdiction of the Labour Court - Industrial Court will not have jurisdiction to examine the question of termination as a consequence of the order of transfer - Jurisdiction of a forum can be invoked only in accordance with the statutory provisions - Alleging termination as a consequence of non-joining on the transferred post will not confer jurisdiction on the Industrial Court. (Para 23)
Facts of the case:
The employee was appointed as a Professional Service Representative and was promoted to Field Sales Officer Grade FM-One. One of the conditions in the letter of appointment was that the employer shall be entitled, at any time during the course of employment, to transfer the employee to any of its affiliates, subsidiaries or sister companies. The employee was transferred to Mumbai. The employee did not join duty at Mumbai; therefore, the service of the employee was terminated on 15th April, 2005.
Finding of the Court:
Employee has rightly been terminated.
Result : Appeal dismissed
Legal Category Hierarchy
- labour and employment law
- administrative law
- practice and procedure
Advocates Appeared:
For the Appellant(s) :Vinay Navare, Gwen Karthika, Abha R. Sharma, Advocates
For the Respondent(s):Seshatalpa Sai Bandaru, Advocate
For the Appellant(s) :Vinay Navare, Gwen Karthika, Abha R. Sharma, Advocates
For the Respondent(s):Seshatalpa Sai Bandaru, Advocate
Table of Contents
2. Employee alleged mala fide transfer as unfair labour practice — Employer contended transfer was contractual and termination resulted from the employee's failure to report for duty. (Para 4 , 5 , 22 )
3. Communication occurs upon dispatch of order — mala fide requires proof of personal bias — individuals accused of malice must be impleaded to answer charges. (Para 12 , 13 , 14 , 18 , 19 )
4. Mala fide transfers require proof of personal bias; termination disputes under Item 1, Schedule IV of MRTU & PULP Act fall exclusively under Labour Court jurisdiction. (Para 14 , 23 )
5. Appeal dismissed — High Court order affirmed. (Para 24 )
6. Does an order become ineffective if the employee does not actually receive the physical copy?
No. Once an order is issued and sent to the concerned employee, it is deemed communicated regardless of actual receipt. This prevents employees from thwarting an order by avoiding its receipt. (Para 12 , 13 )
7. What constitutes a mala fide transfer as an unfair labour practice?
A transfer is mala fide if it is actuated by personal bias, grudge, oblique or improper motive, or ulterior purpose, or if the administrative action is contrary to the objects and conditions of a valid exercise of power. (Para 14 , 15 )
8. Must the specific individuals alleged to have acted with malice be impleaded in proceedings?
Yes. Because a judicial pronouncement of mala fide is a serious indictment that can lead to adverse civil consequences, the persons against whom such allegations are levelled must be impleaded to enable them to answer the charge. (Para 18 , 19 , 20 )
9. Can the Industrial Court decide on the validity of a termination order if it is alleged to be a consequence of a mala fide transfer?
No. Under the MRTU & PULP Act, complaints regarding discharge or dismissal under Item 1 of Schedule IV fall exclusively within the jurisdiction of the Labour Court, not the Industrial Court. (Para 22 , 23 )
JUDGMENT :
HEMANT GUPTA, J.
1. The challenge in the present appeal is to an order passed by the High Court of Judicature at Bombay on 21st January, 2014 whereby the writ petition filed by M/s. Wockhardt Ltd.[for short, ‘employer’) was allowed and the order passed by the Industrial Court on 6th August, 2012 was set aside.
2. The High Court held that the transfer of the appellant [for short, ‘employee’] was as per the terms and conditions of employment. It was held that the employer had to decide who should work at particular place and who was to be transferred to another place in the interest of establishment. It was also held that the employee had failed to challenge the termination order dated 15th April, 2005.
3. Brief facts leading to the present appeal are that the employee was 6th appointed on June, 1985 as a Professional Service Representative and was posted at Sagar, Madhya Pradesh. Thereafter, he was promoted to Field Sales Officer Grade FM-One. One of the conditions in the letter of appointment was that the employer shall be entitled, at any time during the course of employment, to transfer the employee to any of its affiliates, subsidiaries or sister companies. The employee was transferred to Mumbai on 21st March, 2005 with immediate effect. The employee did not join duty at Mumbai; therefore, reminders were sent by the employer on 1st April, 2005 and 8th April, 2005. The service of the employee was terminated on 15th April, 2005.
4. The employee along with National Federation of Sales Representatives’ Union [for short, ‘Union’] filed a complaint on 30th April, 2005 before the Industrial Court, Maharashtra established under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 [for short, ‘Act’]. The allegation of the employee is that he had reasonable and bonafide apprehension that the employer, after filing of the present complaint, was going to take adverse actions such as mala fide transfers, suspension, disciplinary actions, summary terminations etc. against N.P. Mishra, Rajendra Khandelwal, Sandeep Mitra, Manoj Bhatt, Rajaram V. Baliga and Rajkumar Jasnani. The employee has alleged that the basis of apprehended action against the employees mentioned by him was that they have filed affidavits in his favour against unfair labour practices, high handed actions, atrocities etc. committed by employer company and its employer on 15th March, 2005 during the Launching Conference at Ahmedabad. The employee alleged that he was the President of Sagar Unit of Madhya Pradesh Medical Representatives’ Association which is affiliated to complainant No. 1 i.e. the Union. The employee also alleged that one Mr. Ashish Khare, an active member of the Union was forced to resign from the employment of the employer company in January, 2005 but the same was not accepted. He was paid wages till February, 2005. He was invited for a Launching Conference but two managers of the employer company Deepak Sethi, Sales Manager and Sanjay Anand, Regional Manager drove Mr. Ashish Khare out of the hotel at night time. The employee had protested against the same and it is on account of raising his voice against the said atrocities and acts of force, the employee was threatened that he would be transferred and his other colleagues would also be dealt with severely by the employer. Soon after the Conference was over, the employee was transferred on 21st March, 2005. Such transfer order was received on 4th April, 2005. The employee alleged that his transfer was unjust, unfair, illegal, improper, arbitrary and mala fide, amounting to unfair labour practices under Item 3, 7, 9 and 10 of Schedule IV of the Act. It may be noticed at this stage that the complaint was filed against the company and its General Manager (HR) in its official capacity. Relevant assertion in the complaint reads as under:
“(iii) That the impugned transfer order does not mention any business exigency and/or administrative reason/s and, in fact,
