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The Management of Sundaram Fasteners Ltd. Vs. the Presiding Officer and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtChennai High Court
Decided On
Case NumberW.P.Nos.22076 and 29671 of 2007 And M.P.No.1 of 2007
Judge
ActsIndustrial Disputes Act, 1947 - Section 2-A (2), 2(s), 2(oo)(bb), 25-F, 3; Constitution of India - Articles 226
AppellantThe Management of Sundaram Fasteners Ltd.
RespondentThe Presiding Officer and ors.
Appellant AdvocateMr.S.Ravindran, Adv.
Respondent AdvocateMr.V.Prakash, Adv.
Excerpt:
[k.chandru, j.] industrial disputes act, 1947 - section 2-a (2), 2(s), 2(oo)(bb), 25-f, 3 -- the said industrial dispute was heard along with other industrial disputes and a common award was passed by the labour court, salem on 2.5.2006. the management has file a counter affidavit in the writ petition filed by the workman. the workman raised an industrial dispute before the labour officer, krishnagiri under section 2-a (2) of the industrial disputes act. similarly other workmen also moved the labour officer. on the strength of the failure report, the workman filed a claim statement dated 19.8.2002 before the labour court, salem. the management filed a counter statement dated 25.8.2005. the workman filed a rejoinder dated 4.10.2005. the 52 workers includes the present workman......of appointment, a separate application was taken from the workman and on the expiry of the second period of employment, he was not ousted from employment but continued to be paid salary on a voucher under the head "conveyance allowance". he was given appointment order on 9.8.1999, appointing him from the said date as "operative trainee" on temporary basis on consolidated salary of rs.2,175/- plus other allowances of rs.250/- per mensem for a period of one year ending on 31.8.2000. once again, another application was obtained from him before granting appointment. with effect from 1.4.2000, his consolidated salary was revised to rs.2,425/- per mensem. on the expiry of the third spell of period on 31.8.2000, he was not ousted but he was given voucher payment under the head "conveyance.....
Judgment:

Prayer in W.P.22076 of 2007:Petition under Article 226 of the Constitution of India praying for a Writ of Certiorari calling for the records of the 1st respondent in I.D.No.209/05 and quash its award dated 02.5.2006 insofar as it directs the petitioner to pay compensation to the 2nd respondent.

Prayer in W.P.29671 of 2007:Petition under Article 226 of the Constitution of India praying for a Writ of Certiorari calling for the records of the 1st respondent in connection with its award dated 2.5.2006 in I.D.No.209/05 and quash the same insofar as it holds that the issue of the petitioner's claim for permanency cannot be considered along with that of the legality of his termination from service and insofar as it denies the relief of reinstatement with continuity of service with back wages and other consequent benefits to the petitioner.

COMMON ORDER

1. Both Writ Petitions challenge an award made in I.D.No.209 of 2005 dated 02.05.2006 passed by the 1st respondent Labour Court, Salem. The said Industrial Dispute was heard along with other Industrial Disputes and a common award was passed by the Labour Court, Salem on 2.5.2006. Insofar as the workman is concerned, it relates to I.D.No.209 of 2005 and the Labour Court granted in lieu of reinstatement a sum of Rs.1,25,000/- as full and final settlement of all claims together with cost of Rs.300/-. While the management filed the Writ Petition No.22076 of 2007 challenging the award in granting compensation, the workman filed W.P.No.29671 of 2007 challenging the award for not granting the relief of reinstatement with backwages.

2. The Writ Petition filed by the management was admitted on 29.06.2007 and in the 2nd Writ Petition filed by the workman, Notice regarding admission was ordered on 11.09.2007 and it is yet to be admitted. When the 1st Writ Petition came up on 16.02.2012, this Court directed the connected Writ Petition to be listed along with the 2nd Writ Petition as both challenge the same award. Accordingly, both Writ Petitions were heard together and a common order is passed.

3. In the Writ Petition filed by the management, interim stay was granted on 29.6.2007. The management has file a counter affidavit in the Writ Petition filed by the workman. It is also brought to the notice of this Court that the other workers who are covered by the industrial dispute have not chosen to challenge the award and they have settled their claims with the management.

4. The case of the workman was that the management engaged the manufacture of spare parts for two wheelers and four wheelers. It has got factories at Chennai, Hosur, Madurai and Puducherry. The workmen were engaged in Hosur Factory and it has got more than 100 workers and covered by Chapter V-B of the Industrial Disputes Act. The management was indulging in the practice of engaging workers for a long number of years as temporary trainee, apprentice, probationer, etc., thus it was indulging in unfair labour practice. The workman was appointed as trainee on 14.6.1997 upto 30.6.1998 and he was paid consolidated sum of Rs.1,675/-. After 1.4.1998, another allowance of Rs.250/- was paid. Though he was designated as a trainee, he was made to work in the regular establishment. After the expiry of the initial period of training, namely on 30.6.1998, he was not ousted from service. He continued in service for a further period from 1.7.1998 till 8.7.1998. He was paid wages by voucher payment by the management under the head of "Conveyance Allowance". Again on 9.7.1998, he was issued an order of appointment, appointing him as "Work Apprentice" on consolidated sum of Rs.1,925/- per month for a period of 12 months ending 31.7.1999. Prior to the second spell of appointment, a separate application was taken from the workman and on the expiry of the second period of employment, he was not ousted from employment but continued to be paid salary on a voucher under the head "conveyance allowance". He was given appointment order on 9.8.1999, appointing him from the said date as "Operative Trainee" on temporary basis on consolidated salary of Rs.2,175/- plus other allowances of Rs.250/- per mensem for a period of one year ending on 31.8.2000. Once again, another application was obtained from him before granting appointment. With effect from 1.4.2000, his consolidated salary was revised to Rs.2,425/- per mensem. On the expiry of the third spell of period on 31.8.2000, he was not ousted but he was given voucher payment under the head "conveyance allowance" for the period from 1.9.2000 to 11.9.2000. Thereafter, he was issued with another appointment order appointing him as "Operative Trainee Probationer" with effect from 12.9.2000 on a salary of Rs.3,600/- per month. The probation was prescribed for 6 months. Once again a fresh application was obtained from the workman. The probationary period was extended by 6 months upto 30.9.2001 under order dated 25.5.2001. No reason for extension of the probationary period was mentioned in the order dated 25.5.2001. Even after 30.9.2001, he continued to be in employment without any break in service.

5. Thus, during the entire period, he had served for more than 480 days within a period of 24 calendar months and ought to have been made permanent. Like the petitioner, there were 22 other workers, who are similarly engaged initially as trainee and thereafter as probationer and finally all their service came to be terminated with effect from 31.3.2002. The representations were sent on 31.3.2002, 4.4.2002 and 8.4.2002. The cheque sent along with the termination was also returned, objecting to the same. On 30.4.2002, the management once again terminated the services of 23 other socalled probationers in an identical manner.

6. A Writ Petition was also filed before this Court being W.P.No.14625 of 2002. When that Writ Petition came up for admission on 30.4.2002, this Court granted direction to the respondents not to give effect to the order of termination and continue to pay their salary. However, it is brought to the notice of this Court that the above Writ Petition No.14625 of 2002 was finally disposed of by this Court on 10.5.2005.

7. The workman raised an industrial dispute before the Labour Officer, Krishnagiri under Section 2-A (2) of the Industrial Disputes Act. Similarly other workmen also moved the Labour Officer. The Conciliation Officer, as he could not bring about mediation between the parties, gave a failure report dated 5.9.2002. On the strength of the failure report, the workman filed a claim statement dated 19.8.2002 before the Labour Court, Salem. The said dispute was registered as I.D.No.209 of 2005 and notice was issued to the management.

8. The management filed a counter statement dated 25.8.2005. The workman filed a rejoinder dated 4.10.2005. Similarly the other disputes raised by the other workmen were taken on file as I.D.Nos.207, 208, 210, 211, 212 and 213 of 2005 and a common trial was conducted.

9. Before the Labour Court, all the 7 workers whose disputes were taken on file, examined themselves as W.W.1, W.W.3 to W.W.8 and one Mr.R.Balasubramanian was examined as W.W.2. The present workman was examined as W.W.3. On the side of the management, one P.Nagendran was examined as M.W.1. The workmen filed 34 documents, which were marked as Ex.M.1 to Ex.M.34. The management filed 92 documents and they were marked as Ex.M.1 to Ex.M.92.

10. The stand of the management before the Labour Court was that the management selected candidates for training for a period of one year, which will be followed as one year apprenticeship and thereafter as temporary employment. Initially the training was intended to expose the candidate for a factory environment and working conditions and thereafter the work apprenticeship is to impart on the job training to enable to get themselves familiarize with the factory operations. At the time of appointment as a trainee as well as apprentice, the concerned candidates were clearly informed that their traineeship or work apprenticeship is no guarantee for career or permanent employment. Even after the completion of the traineeship and work apprenticeship, there is no assurance for regular employment. The management continues to use their service on payment of periodical improved remuneration and such engagement is designated as temporary employment. Whenever there was anticipated need for increasing the permanent man power requirement, then the temporary workmen are offered probationary employment which is considered to be a permanent employment subject to the employee being fit and an opportunity for regular employment was available at the end of probation period. The probationary employment was also extended from time to time depending on the level of performance and the real need to augment permanent labour force. The said exercise of engagement of training, apprentices and temporary workmen have been in vogue in the company since 1979. While some persons were recruited as permanent employees, several others were left being to fend for themselves by looking for alternate employment. In the early part of 2002, 52 probationers could not be considered for regular employment and their services came to an end on 31.3.2002. Though cession of employment was brought by efflux of time, it was not a case of retrenchment. The 52 workers includes the present workman. They were informed the inability of the management to consider for permanent employment. Out of 52 workers, 40 workers have accepted their cessation of employment by receiving the financial assistance provided by the respondent, which was marked as Ex.R.92 through the evidence of R.W.1. The remaining 12 workers including the workman have pursued the litigation. The cession of employment of the workman would not amount to retrenchment and the provisions of Chapter V-B of the Industrial Disputes Act will not apply.

11. The Labour Court upon the evidence placed before it both oral and documentary held that the workmen are covered by the Industrial Disputes Act within the meaning of Section 2(s) of the Act and it cannot be considered that throughout their employment, they were only given training. Their continuance beyond the period of three years in one form or other, namely trainee or apprentice or probationer is clearly contrary to the Certified Standing Orders. Since their termination was for the reason that their probation period was not satisfactory and left their service, it cannot be held that they are entitled for deemed permanent status in terms of Tamil Nadu Act 46 of 1981 and such an issue cannot be decided as it is not an incidental issue to the main dispute.

12. In fact, the Labour Court held that in the order of extension of probation given on 1.10.2001, which was marked as Ex.M.24, in the case of the workman Kannadasan, it was stated that it was done on review of performance of his work in the company as well as the situation the company which is placed under general recession. There will be no useful purpose will be served in continuing him in the service as probationer and considering him for permanent position.

13. Even though the management has assigned such a reason, in the counter affidavit no such statement was found and no evidence was let in to prove such statement. Hence, their services were illegally terminated. But, at the same time, since the management has offered retrenchment compensation, there was no dispute regarding the quantum of compensation ordered and it will not come within the exception to Section 2(oo)(bb) of the Industrial Disputes Act. The Labour Court held that since no enquiry was held and prior notice was not given, it decided to grant compensation to the workman and in the case of the present workman, the compensation of Rs.1,25,000/- was fixed by the Labour Court.

14. The contention raised by the management was that while 40 out of 52 workers have accepted their cessation of employment and accepted amounts, there is no question of proving the dispute raised at the instance of 12 workers. It was also brought to the notice that there was a recession in the factory, which was deposed by M.W.1 and therefore they were terminated during March 2002 and in the case of the workman, the termination was due to poor performance and non-requirement of of permanent workmen in the establishment and he is not eligible for any relief.

15. In this context, the learned counsel for the management placed reliance upon the judgment of this Court in R.Baskar and others vs. M/s.Auto Care Centre, Chennai and another reported in 2002 (4) LLN 518 for contending that if a casual employee, who was engaged after his tenure as apprentice, while raising a dispute under Section 2-A of Industrial Disputes Act, refuses a relief of reinstatement as a casual labourer and only seeks permanent employment, even for violation of Section 25-F of the Industrial Disputes Act by the management, only compensation can be ordered.

16. Thereafter, he referred to the judgment of the Supreme Court in Escorts Limited vs. Presiding Officer and another reported in (1997) 11 SCC 521 for contending that if a temporary employee is appointed only for a specified period and the terms of appointment enables the employer to terminate the service at any stage without assigning any reason and if he is terminated on such terms even before the expiry of the period, it could not be called as retrenchment as it comes within the exception provided under Section 2(oo)(bb) of the Industrial Disputes Act.

17. The learned counsel placed reliance upon the judgment of the Supreme Court in Manager, Reserve Bank of India, Bangalore vs. S.Mani and others reported in (2005) 5 SCC 100 for contending that merely because an employee completes 240 days of continuous service, that by itself will not claim any permanency and any reinstatement can be done only to the same status which was held by him and by restoring the person as a temporary employee, he can only do the work of temporary employment and not that of permanent employment. In case of non-denial or non-response to a plea, that is not supported by evidence, it cannot be deemed to be admitted by applying the doctrine of non-traverse. The Evidence Act does not say to the contrary and pleadings are not substitute for proof.

18. But, in the present case, the Labour Court clearly found that it is not a mere non-pleading in the counter affidavit but also no oral evidence was let in regarding the socalled unsatisfactory employment of the workman. Further, the Labour Court also found that it is not a case of exception of retrenchment and comes within section 2(oo) of the Industrial Disputes Act. Further, in the order of termination itself it is stated that the displacement of the workers was due to general recession in the factory. If it is accepted, it is a clear case of retrenchment within the meaning of Section 2(oo) of the Industrial Disputes Act.

19. It is clearly pleaded that it is a factory covered by Chapter V-B of the Industrial Disputes Act and inasmuch as a prior approval under Section 25-N of the Industrial Disputes Act was not obtained, it is a clear case of illegal retrenchment and the workers are entitled to be continued in service. Though the Labour Court was wrong in stating that it cannot go into any incidental question, namely whether the workman has assigned permanent status in terms of Act 46 of 1981, that need not be gone into at this stage. Under Section 3 of Act 46 of 1981, the workers are deemed to be become permanent without there being any order of any court and it is a satisfactory declaration conferred on the workers. The fact that the other workers have not challenged the award is not a conciliation for denying the relief to the present workman.

20. The Supreme Court has clearly held that in such an event when a retrenchment has become void abinitio, the workman can get the relief of reinstatement with continuity of service and backwages in the same status vide its judgment in State Bank of India vs. Sundaramoorthy reported in AIR 1976 SC 1111.

21. The Supreme Court in Harjinder Singh v. Punjab State Warehousing Corporation reported in (2010) 3 SCC 192 held that in such cases, the denial of reinstatement of a workmen will be illegal and the workmen are entitled to normal relief of reinstatement and backwages. In paragraphs 21,23,24,30 and 31 it was held as follows:

"21.Before concluding, we consider it necessary to observe that while exercising jurisdiction under Articles 226 and/or 227 of the Constitution in matters like the present one, the High Courts are duty-bound to keep in mind that the Industrial Disputes Act and other similar legislative instruments are social welfare legislations and the same are required to be interpreted keeping in view the goals set out in the Preamble of the Constitution and the provisions contained in Part IV thereof in general and Articles 38, 39(a) to (e), 43 and 43-A in particular, which mandate that the State should secure a social order for the promotion of welfare of the people, ensure equality between men and women and equitable distribution of material resources of the community to subserve the common good and also ensure that the workers get their dues. More than 41 years ago, Gajendragadkar, J. opined that:

10.  The concept of social and economic justice is a living concept of revolutionary import; it gives sustenance to the rule of law and meaning and significance to the ideal of welfare State.

(State of Mysore v. Workers of Gold Mines13, AIR p. 928, para 10.)

23. The Preamble and various articles contained in Part IV of the Constitution promote social justice so that life of every individual becomes meaningful and he is able to live with human dignity. The concept of social justice engrafted in the Constitution consists of diverse principles essentially for the orderly growth and development of personality of every citizen. Social justice is thus an integral part of justice in the generic sense. Justice is the genus, of which social justice is one of its species. Social justice is a dynamic devise to mitigate the sufferings of the poor, weak, Dalits, tribals and deprived sections of the society and to elevate them to the level of equality to live a life with dignity of person. In other words, the aim of social justice is to attain substantial degree of social, economic and political equality, which is the legitimate expectation of every section of the society.

24. In a developing society like ours which is full of unbridgeable and ever widening gaps of inequality in status and of opportunity, law is a catalyst to reach the ladder of justice. The philosophy of welfare State and social justice is amply reflected in large number of judgments of this Court, various High Courts, National and State Industrial Tribunals involving interpretation of the provisions of the Industrial Disputes Act, Factories Act, 1948; Payment of Wages Act, 1936; Minimum Wages Act, 1948; Payment of Bonus Act, 1965; Workmen's Compensation Act, 1923; Employees' State Insurance Act, 1948; Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and Shops and Commercial Establishments Act enacted by different States.

30. Of late, there has been a visible shift in the courts' approach in dealing with the cases involving the interpretation of social welfare legislations. The attractive mantras of globalisation and liberalisation are fast becoming the raison d'jtre of the judicial process and an impression has been created that the constitutional courts are no longer sympathetic towards the plight of industrial and unorganised workers. In large number of cases like the present one, relief has been denied to the employees falling in the category of workmen, who are illegally retrenched from service by creating by-lanes and side-lanes in the jurisprudence developed by this Court in three decades. The stock plea raised by the public employer in such cases is that the initial employment/engagement of the workman/employee was contrary to some or the other statute or that reinstatement of the workman will put unbearable burden on the financial health of the establishment. The courts have readily accepted such plea unmindful of the accountability of the wrong doer and indirectly punished the tiny beneficiary of the wrong ignoring the fact that he may have continued in the employment for years together and that micro wages earned by him may be the only source of his livelihood.

31.It need no emphasis that if a man is deprived of his livelihood, he is deprived of all his fundamental and constitutional rights and for him the goal of social and economic justice, equality of status and of opportunity, the freedoms enshrined in the Constitution remain illusory. Therefore, the approach of the courts must be compatible with the constitutional philosophy of which the directive principles of State policy constitute an integral part and justice due to the workman should not be denied by entertaining the specious and untenable grounds put forward by the employerpublic or private.

22. In the light of the above, the impugned award insofar as the petitioner is concerned is modified and the workman is entitled to get reinstatement with backwages and continuity of service and other attendant benefits. Hence, W.P.No.29671 of 2007 filed by the workman stands allowed. W.P.No.22076 of 2007 filed by the management stands dismissed. However, the parties are allowed to bear their own costs. The connected Miscellaneous Petition is closed.


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