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The Management of Associated Traders and Engineers Pvt. Ltd. Vs. Basant Lal Bhambri and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtDelhi High Court
Decided On
Case NumberCivil Writ Appeal No. 71 of 1969
Judge
Reported inILR1971Delhi578; 1972LabIC126
ActsConstitution of India - Articles 226 and 227; ;Delhi Shops and Commercial Establishment Act - Sections 30
AppellantThe Management of Associated Traders and Engineers Pvt. Ltd.
RespondentBasant Lal Bhambri and ors.
Advocates: Anand Prakash and; L.D. Adlakha, Advs
Cases ReferredIn Hindustan Steel Limited v. Rourkela Mazdoor Sabha and
Excerpt:
(i) master and servant --contract of service for a fixed period --service ends by efflux of time --notice of termination not required --workman not entitled to claim service and wages beyond contract period.; that liability of the employer to retain the employee in service and to pay wages cannot be extended beyond the contract period. at the end of the contract period an employee automatically goes out, unless the employer takes a positive action in extending the period of contract. no order is required to be passed by the management bringing about the termination of an employee at the end of the contract period. ; (ii) master and servant --notice of termination of services of an employee --sufficiency of.; that the test of the sufficiency of a notice is not what it would mean to a..........5, 1960, meaning thereby that the extension was with effect from november 5, 1964 when the earlier contract period expired. in this view of the matter the service of the respondent automatically stood terminated on the expiry of the said renewed term i.e., in the after-noon of 4th november or in the forenoon of 5th november 1966. notice dated november 4, 1966 informing the respondent that his service stood terminated with effect from 5th november 1966 in terms of the agreement as renewed from time to time. thereforee, was perfectly valid. (12) it will be noticed that this was not the stand of the respondent before the labour court, where the only plea was that the extension of two years started with effect from 10th november 1964 and the service could have been terminated with effect.....
Judgment:

P.N. Khanna, J.

(1) The Management of Associated Tindds & Engineers Private Ltd., New Delhi, has filed this petition under Articles 226 and 227 of the Constitution of India for the issuance of a writ to quash the order dated August 6, 1968 published in she Delhi Gazette on October 31, 1968 of Labour Court respondent No. 2.

(2) Basant Lal Respondent No. .1 (hereinafter referred to as 'the respondent') was employed as a clerk by the petitioner on a monthly salary of Rs. 150.00 as per Agreement dated November 5. 1960. 'Clauses 1 and 16 of the Agreement are material and are reproduced below:

'1.It is agreed between the parties that this contract of appointment is for a specific period of two years only. 16. During the period the contract is in force, this contract may be terminated on either side without assigning any reason thereforee on giving one month's notice or on payment of an amount equivalent in lieu of such notice by the either party. No. notice shall, however, be necessary if the contract is terminated by either party within three months of signing this contract. The contract shall automatically be terminated on the expiry of the specific period of 2 years from the date of signing this instrument unless it is extended only by mutual consent on such terms and conditions us may be agreed upon by both the parties. No. compensation in lieu of such notice shall be payable by the company where the employee has committed any breach of the rules and regulations of the company in force or has committed any breach of the terms and stipulations in this contract.'

(3) According to the petitioner, the services of the respondent were renewed from time to time. The last renewal of service was as per letter dated November 10, 1964 which was addressed by the petitioner to the respondent and reads as under :-

'WEare pleased to renew your contract of service for a further period of two years in terms of our agreement dated 5th November, 1960.'

(4) On November 4, 1966 an order terminating the services of the respondent was made by the petitioner and it reads as under:-

'PLEASEnote that your services shall stand terminated with effect from 5th November, 1966 in terms of the agreement dated 5th November, 1960 entered into between yourself and the Company, as renewed from time to time.'

(5) As per notification dated December 7, 1967, the Delhi Administration referred the following question to the Labour Court:-

'WHETHERthe termination of services of Shri Basant Lal Bhambri from 5th November, 1966 is wrongful and/or unjustified and if so to what relief if. any. is he entitled.'

(6) The Labour Court referred to the letter dated November 10. 1964 and came to the conclusion that the service of the respondent was extended on and from that dale for a period of two years. The contention on behalf of the petitioner that the service of the respondent should be deemed to have been extended from November 5, 1964, was repelled, because, in the opinion of. the Labour Court, if the period of two years has to be extended from the time of expiry of the original agreement, in that event it would expire on 'November 4, 1964. The Labour Court held that the termination of service of the respondent could have been done only after one month's notice, and in this connection observed as under:-

'the order dated 4th November. .1966 staled that his service shall stand terminated with effect from 5th November, 1966 in terms of agreement dated 5th November, 1960. Now in view of the extension of two years beginning from 10th November. 1966 the service could have stood terminated from the afternoon of 9th of November, 1966 or forenoon of 10th of November, 1966. It could not have stood terminated with effect from 5th November, 1966 merely because the original agreement provided for a period of two years from 5th November, 1960. This means that the services were terminated during the continuance of two years from 5th November, 1960. This means done only after the management acted wrongly in terminating the services of Shri Basant Lal without giving the stipulated notice of one month.'

(7) The Labour Court also relied upon the provision of section 30 of the Delhi Shops and Commercial Establishment Act for coming to the conclusion that notice of one month was essential for terminating the services of the respondent. Having held the termination of the service of the respondent to be wrongful, the Labour Court held that the respondent was entitled to reinstatement with full back wages and continuity of service.

(8) The Labour Court also found that there were two rival Unions; one of which, namely, the Delhi Private Motor Transport Workers' Union is the Union through which the worker Basant Lal respondent has been pursuing the matter involved in this appeal; the other is Associated Traders and Engineers Private Limited Employee's Union, which is alleged to have been created at the instance of the management. The management is said to have felt aggrieved at the election of Shri Naresh Jain, as the General Secretary of the latter Union, because he was already a member of the former Union. The respondent Basant Lal, according to the Labour Court was called upon by one Shri Puri, the Head Clerk to sign some papers for the removal of Shri Naresh Jain from the General Secretaryship of the Union., which has been styled as the puppet Union of the management. On his refusal to do so, the very next day he was given notice of termination. This according to the Labour Court was clear victimisation and unfair labour practice as a result of which the termination of the respondent's services was brought about and which, thereforee, could not be upheld.

(9) Dr. Anand Parkash, the learned counsel appearing on behalf of the petitioner contended that both grounds on which the decision 'of the Labour Court rested were without any substance. The service of the respondent was for a fixed period and came to an end automatically on the expiry of the said period. And the respondent was never asked by the management to sign any paper for the removal of Shri Naresh Chand Jain, from the General Secretaryship of the Union to which he was elected. The verdict of unfair practice for victimisation thereforee, urged the learned counsel, was wholly unjustified.

(10) Mr. L. D. Adiakha, the learned counsel for the respondent contended that the respondent was appointed with effect from September 15, 1960 for a term of two years, as is evident from letter dated November 5, 1960, Annexure 'A The renewal of his service, thereforee, could always be from the 15th day of September. The contract of service could come to an end only on 14th day of September in any particular year. The notice terminating his services with effect from 5th November 1966 was not in terms of the agreement and was invalid.

(11) This contention of Mr. Adlakha is without substance. The letter, Annexure 'A dated November 5, 1960 says that the respondent is appointed 'according to the agreement signed by him today with effect from September 15, 1960'. This means that although the respondent may have joined the service on September 15, 1960, his appointment was 'according to the agreement'. In terms of clause 16 of the agreement, reproduced above, the service of the respondent automatically terminated 'on the expiry of the specific period of two years from the date of the signing of this instrument, unless it was extended by mutual consent on such terms and conditions as may be agreed upon by both parties. Two years from November 5. 1960 the date of the signing of the agreement expired on November 4, 1962 and its renewal expired on November 1964. On November 10, 1964 the management wrote to the respondent that his contract of service Was renewed for a further period of two years on the terms of the said agreement dated November 5, 1960, meaning thereby that the extension was with effect from November 5, 1964 when the earlier contract period expired. In this view of the matter the service of the respondent automatically stood terminated on the expiry of the said renewed term i.e., in the after-noon of 4th November or in the forenoon of 5th November 1966. Notice dated November 4, 1966 informing the respondent that his service stood terminated with effect from 5th November 1966 in terms of the agreement as renewed from time to time. thereforee, was perfectly valid.

(12) It will be noticed that this was not the stand of the respondent before the Labour Court, where the only plea was that the extension of two years started with effect from 10th November 1964 and the service could have been terminated with effect from the afternoon of 9th November 1966 or the fore-noon of 10th November 1966.

(13) It must be borne in mind that the test of the sufficiency of a 'notice is not what it would mean to a stranger ignorant of the facts and circumstances of the case but what it would mean to the person to whom it has been addressed and who is presumably coversant with all the facts and circumstances. The notice cannot be construed with a desire to find out, how it can be made ineffective. On the 'other hand, it has to be construed in a manner in which it could be. rendered valid. Unnecessary hypertechnical interpretation cannot be resorted to. In this case the service of the respondent worker being admittedly for a fixed period, did not require a notice of termination. Both parties had notice on the commencement of the Service, that it was to come to an end on the expiry of the limited period.

(14) In V.R.M.S. Bus Service v. Labour Court Coimbatore and others 1961 2 L J 507 0 the Madras High Court was considering the case of a workman who had been employed for a definite term of eight months. The award directed reinstatement with back wages as the termination was found wrongful. The liability to entertain the workman in service and to pay wages, it was held, would not be extended beyond the contract period.

(15) In Hindustan Steel Limited v. Rourkela Mazdoor Sabha and others, (1970) 2 L LJ 533, the employee was on a contract for a period of three years expiring on January 5, 1964. His service was terminated for misconduct. The Labour Court held the dismissal unjustified and ordered reinstatement with back wages. Upholding the findings of the Labour Court that the order of dismissal was unjustified, it was held by the High Court of Orissa, that the employee at the end of the contract period automatically goes out unless the management takes a positive action in extending the period of contract. It was further held that no order was 'required to be passed by the management bringing about the termination of services of an employee at the end of the contract period. The Labour Court was held not justified in reinstating the workman into service after the expiry of the contract period.

(16) In the case before us, the letter dated November 10, 1964 renewing contract of service of the respondent for a period of two years in terms of the agreement dated November 5, 1960, was held by the Labour Court, to have been signed by the respondent workman against the word 'agreed'. The Labour Court, thereforee, came to the conclusion that 'the service was extended from that date for a period of two years'. It is. thereforee, a clear case of contract of service for a fixed period. According to the Labour Court the said fixed period 'expired on the after-noon of 9th November 1966 or the fore-noon of 10th November 1966'. But as held above, the fixed period of service according to the agreed extension of service, expired on the after-noon of 4th November 1966 or the fore-noon of the 5th November 1966; and in accordance with the terms of the contract, the services of the respondent automatically came to an end on the expiry of the contract period. It was, thereforee, not necessary to serve the respondent with a notice terminating his service as no termination was involved. It was in fact the completion of the period of service by efflux of time.

(17) It was contended that the establishment was covered by the Delhi Shops and Commercial Establishment Act. Under section 30 of the Act one month's notice was necessary for terminating the services of an employee, after employment of over three months. But as already held, it is not a case of the employer's terminating the service of the employee. It is a case of automatic discharge of they employee after the completion of the contract period of service. It was not necessary under the circumstances to serve the respondent with a separate notice. The finding of the Labour Court that. the termination could have been done only after one month's notice is erroneous and cannot be sustained.

(18) So far as the charge of victimisation is concerned, the finding of the Labour Court is that Shri Puri, the Head Clerk, had asked the respondent to sign a paper for the removal of Shri Naresh Chand from the General Secretaryship of the management sponsored Union, as he was already a member of the other rival Union. There is no finding to the effect that Shri Puri was acting under instructions from or on behalf of the management. It is, thereforee, unjust to attribute to the management the action of Shri Puri. If an employee persuades a co-employee to sign a particular paper for certain purpose without the knowledge or consent of the management, the management cannot be held responsible for the act. There is no justification, thereforee, for the Labour Court to hold that the management had indulged in victimisation or any unfair labour practice.

(19) Shri Adiakha attempted in a half-hearted manner to point out that the award of the Labour Court was implemented. He refered to a letter of the management, where after the award was announced, the respondent was asked to report for duty at Najafgarh Road Office. The award, of course, held the field at that time, and had not been set aside. It is admitted, however, that the respondent refused to comply with this direction of the management on the ground that he had throughout been employed at Naya Bazar Office and could be posted only at Naya Bazar. Nothing further took place and there is no justification to suggest that the award was implemented.

(20) In the result, the award of the Labour Court dated August 6, 1968, published in the Delhi Gazette dated October 31, 1968, cannot be sustained and the same is, thereforee, quashed. In the circumstances of the case, there shall, however, be no order as to costs.


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