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Bahujan Vikas Education Society v. Vidya Devi

Bombay High Court
Mar 24, 2006
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Judgment Summary (as contained in the provided opinion)

Factual and Procedural Background

The Management (petitioner) had appointed present respondent No. 1, Smt. Vidya Devi Raut, as an Assistant Teacher. Her services were terminated by a notice dated 2 April 1986 on the ground that the approval for her appointment was for only one year. Approximately six months after termination, the Education Officer modified the approval to be for two years; by then respondent No. 1 had already ceased to be an employee and the petitioner did not reinstate her.

Respondent No. 1 appealed to the School Tribunal; the appeal was filed beyond the period of limitation and was dismissed by the School Tribunal on 20 January 1988 on account of delay. She then filed Writ Petition No. 548 of 1988 before this Court, which by judgment dated 19 April 1990 quashed and set aside the School Tribunal's order and held the notice of termination to be bad. The 1990 judgment did not expressly state whether the delay was condoned for purposes of rehearing, nor did it explicitly state whether reinstatement and/or back-wages were being granted.

Parties thereafter proceeded on a common understanding that respondent No. 1 had been reinstated. Respondent authorities (Deputy Director of Education and Education Officer) construed the earlier order as entitling respondent No. 1 to back-wages and, by communications dated 23 April 1991 (Annexures C and D), directed that the Management pay salary and allowances for the period of unemployment or have such arrears recovered from non-salary grants payable to the school. The Management challenged those communications by filing the present petition.

Legal Issues Presented

  1. Whether the judgment of this Court dated 19 April 1990 (in Writ Petition No. 548 of 1988) could be read to include an order for payment of full back-wages to respondent No. 1, notwithstanding the absence of an explicit direction to that effect in the judgment.
  2. Whether the Education Officer or the Deputy Director of Education had the jurisdiction or authority to interpret the Court's order so as to impose liability on the Management to pay back-wages and allowances where the Court's order did not expressly provide for such payment.
  3. Whether an order for back-wages can be inferred by implication from an order setting aside termination, or whether an express judicial direction is required to award back-wages.
  4. Whether the directions issued by the Deputy Director of Education and the Education Officer complied with principles of natural justice (as alleged by the petitioner).

Arguments of the Parties

Petitioner's Arguments (Management)

  • The 19 April 1990 judgment could at most be construed to order reinstatement and did not, expressly or by necessary implication, award back-wages.
  • An order for back-wages must be explicit; it cannot be supplied by implication or by an executive authority interpreting a judicial order.
  • The Education Officer had no jurisdiction to interpret and supplement the Court's order to include back-wages where none had been granted.
  • The Deputy Director of Education and the Education Officer could not supplant the text of the judgment by adding directions that were not present, as the absence of such directions was a conscious judicial act rather than a clerical omission.
  • The directions (Annexures C and D) were issued without compliance with principles of natural justice.
  • Reliance was placed on several Supreme Court judgments in support of the position that reinstatement does not automatically carry with it an award of full back-wages and that back-wages are a discretionary relief requiring proof that the employee was not gainfully employed during the period in question.

Respondents' Arguments (including Counsel Mr. C.K. Sable)

  • The Education Officer's order was based on a plain reading of this Court's earlier order; when the order of termination was set aside, the consequential effect included reinstatement with full back-wages.
  • The Education Officer and the Deputy Director of Education are authorities to whom the orders of the School Tribunal and this Court are binding; consequently, their implementation of the Court's order did not call for interference.
  • Alternatively, the withdrawal by respondent No. 1 of the deposited amount was a bona fide act; respondent No. 1 is a poor teacher and some latitude should be allowed.
  • If recovery from respondent No. 1 were ordered, it should be without interest and by modest instalments (e.g., around Rs. 1,000 per month); counsel, however, was not able to specify exact carry-home salary or exact monthly deduction.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Kendriya Vidyalaya Sangathan v. S.C. Sharma, (2005) 2 SCC 363 The opinion quotes Paras 14–16 of this decision to establish that (a) payment of backwages involves discretionary consideration of facts and circumstances and is not an automatic consequence of setting aside termination; (b) the employee initially bears the onus of proving non-gainful employment; and (c) a Court should not usurp factual findings of authorities without reasons. The Court relied on the ratio in Kendriya Vidyalaya Sangathan as binding precedent to conclude that full backwages are not automatically payable upon setting aside termination and that the respondent had not discharged the burden to show non-gainful employment.
P.G.I. of Medical Education and Research v. Raj Kumar (as discussed in Kendriya Vidyalaya Sangathan) The opinion reproduces a passage noting that a Court should not interfere with a factual finding of a Labour Court/Tribunal unless perversity or error is shown; and that payment of full backwages cannot be directed by a higher court ignoring factual conclusions. The Court cited the P.G.I. passage (via Kendriya) to support the principle that higher courts must respect factual conclusions of tribunals and that backwages are not to be awarded indiscriminately.
Hindustan Motors Ltd. v. Tapan Kumar Bhattacharya, (2003) 6 SCC 41 The opinion lists this case as one in which the position regarding discretion in awarding backwages was reiterated. The Court noted that the position was reiterated in this case and treated it as part of the line of authority affirming that backwages are discretionary; it contributed to the Court's conclusion that full backwages were not automatically due.
Indian Railway Construction Co. Ltd. v. Ajay Kumar, (2003) 4 SCC 579 The opinion records this case among those cited to support the principle that backwages are not necessarily payable in full as a matter of course. The Court treated it as one of the decisions forming the consistent Supreme Court position relied upon to deny an automatic award of full backwages.
M.P. State Electricity Board v. Jarina Bee (Smt.), (2003) 6 SCC 141 The opinion includes this case in the group of decisions reiterating the discretionary nature of backwages. The Court referenced it as part of the supporting authority for the principle that backwages are a discretionary relief and must be specifically directed to be payable.
Rajasthan S.R.T.C. v. Ladulal Mali, (1996) 8 SCC 37 This precedent was cited by the petitioner; the specific rule or principle drawn from it is not elaborated in the provided opinion. The opinion records that the petitioner relied on this judgment, but it does not describe a specific application of this precedent in the Court's analysis.
Rajasthan State Road Transport Corpn. v. Shyam Bihari Lal Gupta, (2005) 7 SCC 406 The opinion lists this case among those relied upon by the petitioner; no specific principle from the case is explicated in the provided text. The Court noted the petitioner relied on this authority; the opinion does not state any detailed application of this case to the facts.
General Manager, Haryana Roadways v. Rudhan Singh, (2005) 5 SCC 591 The opinion lists this case as cited by the petitioner; the provided text does not set out a distinct principle taken from it. The opinion acknowledges the citation but does not describe a particular use or application of this case in its reasoning beyond grouping it with other supporting authorities.

Court's Reasoning and Analysis

The Court undertook a step-by-step analysis based strictly on the materials and authorities before it:

  1. The Court examined the 19 April 1990 judgment in Writ Petition No. 548 of 1988 and noted that the School Tribunal had dismissed the appeal only on the ground of delay; this Court set aside that order. The Court emphasized that the 1990 judgment did not explicitly address whether delay was condoned for rehearing, whether reinstatement was ordered, or whether back-wages were awarded.
  2. The parties had proceeded on a common understanding that respondent No. 1 had been reinstated, while respondents construed the order to include back-wages. The Deputy Director and the Education Officer issued communications (dated 23 April 1991) fixing liability on the Management for salary and allowances for the period of unemployment.
  3. The Management challenged those communications arguing that the High Court's 1990 order did not award back-wages; back-wages must be explicitly ordered; and executive authorities cannot add to or modify judicial orders. The Management also alleged lack of natural justice in the impugned directions.
  4. The Court considered the line of Supreme Court authority, most notably Kendriya Vidyalaya Sangathan v. S.C. Sharma, which (as quoted) establishes that (a) payment of back-wages is a discretionary remedy depending on facts and circumstances and is not automatic, (b) the employee bears the initial burden of proving non-gainful employment, and (c) higher courts should not overturn factual findings of tribunals without justified reasons.
  5. Applying these principles, the Court concluded that the prior judgment of this Court (19 April 1990) did not expressly award full back-wages; the absence of such a direction must be read as a conscious judicial act rather than an omission capable of being filled in by executive authorities.
  6. The Court held that neither the Deputy Director of Education nor the Education Officer had the competence to amend or supplement the operative terms of the Court's judgment by issuing directions that effectively awarded back-wages where the judgment contained no such direction.
  7. Because respondent No. 1 had not pleaded or placed material to discharge the initial burden of showing non-gainful employment during the period of unemployment, she was not entitled to full back-wages as a matter of law under the authorities relied upon.
  8. Consequently, the Court found Annexures C and D (the communications of 23 April 1991) illegal and without jurisdiction, and concluded that the amount already paid to respondent No. 1 under court order (Rs. 1,12,000) was liable to be refunded to the petitioner-Management.
  9. Recognizing the financial status of respondent No. 1 (a teacher), the Court exercised discretion in the recovery mechanism: it ordered monthly instalments of Rs. 2,500 to be deducted from salary and allowances, with any remaining balance on retirement recoverable from retiral benefits; it fixed simple interest at 6% per annum on the reducing balance from the date of deposit in Court until recovery.

Holding and Implications

Holding: The writ petition was allowed. The Court quashed and set aside the impugned communications dated 23-4-1991 issued by the Education Officer and the Deputy Director of Education (Annexures C and D). The Court held that respondent No. 1 was not entitled to full back-wages under the 19 April 1990 judgment. The sum of Rs. 1,12,000 received by respondent No. 1 under the earlier order is liable to be refunded to the petitioner-Management with simple interest at 6% per annum on the reducing balance. Recovery shall be effected by monthly deductions of Rs. 2,500 from the respondent's salary and allowances, and any balance on retirement shall be recoverable from retiral benefits. Parties shall bear their respective costs.

Implications: The direct consequences for the parties are (a) the directions of the Education Officer and the Deputy Director of Education dated 23 April 1991 are quashed and set aside; (b) respondent No. 1 must refund Rs. 1,12,000 with interest as ordered; and (c) the Management is entitled to recover that amount by the instalment procedure specified by the Court. The Court's decision adheres to and applies the Supreme Court principle (as discussed in Kendriya Vidyalaya Sangathan and related authorities) that reinstatement by itself does not automatically carry with it an award of full back-wages and that an express judicial direction is required. The opinion does not announce a novel legal principle beyond applying existing Supreme Court authority to the facts of the case.

Order accordingly.
Show all summary ...

A.H Joshi, J.:— Heard learned Advocates for the parties.

2. This is a Petition by the Society who is aggrieved by the decision of the Deputy Director of Education communicated by letter, dated 23rd April, 1991, that the Management was responsible to pay the salary and allowances of Smt. Vidya Devi Raut who is present respondent No. 1, and consequential order issued by Education Officer, dated 23rd April, 1991, informing that salary and allowances towards period of unemployment of Smt. Vidya Devi Raut be paid by the Management, and if not paid, the arrears be recovered from the Non-salary Grants payable to the School.

3. The brief background of the case, which needs to be adverted to, is narrated hereinafter.

4. Present respondent No. 1 was appointed by the petitioner-Management as Assistant Teacher. Her services were terminated by notice, dated 2nd April, 1986, as the approval for appointment was for only one year. After six months from the termination, the Education Officer modified the approval and ordered it to be for two years. When the modified approval was issued, the respondent No. 1 herein had already ceased to be an employee of the petitioner. Petitioner did not reinstate the respondent No. 1.

5. Aggrieved by the notice of termination, respondent No. 1 preferred an appeal before the School Tribunal. The appeal was filed after expiry of period of limitation. The School Tribunal dismissed the appeal on account of delay by Order, dated 20th January, 1988.

6. The respondent No. 1, who was aggrieved by the judgment of the School Tribunal, preferred Writ Petition No. 548 of 1988, which was heard and decided by this Court (Coram: M.S Ratnaparkhi and M.B Ghodeswar, JJ.) by Judgment and Order, dated 19th April, 1990. This Court passed the following order:—

“9. The order passed by the School Tribunal, Nagpur, therefore, deserves to be quashed and set aside. The petition deserves to be allowed. Accordingly the order passed by the School Tribunal, Nagpur, is quashed and set aside. The notice of termination issued by the respondents 1 and 2 to the petitioner is bad. Rule is made absolute in terms above. There shall, however, be no order as to costs.”

7. [quoted from Para 9 at page 24 of the Petition].

8. It is pertinent to note that School Tribunal had not heard the appeal on merits, and was dismissed on the point of delay only. It seems that this Court, however, thought it fit to set aside the order without explicitly stating as to whether:

(i) upon setting aside order, the delay was condoned and appeal was to be re-admitted, heard and decided according to law;

(ii) whether the notice or order of termination, which was subject matter of appeal before the School Tribunal, was set aside, and reinstatement was granted, and

(iii) if order of reinstatement was granted, whether it was with or without back-wages.

9. While the things are left as they exist, parties have proceeded on the common understanding-that present respondent No. 1 has been reinstated.

10. The respondents, however, construed the order to be of reinstatement as well as of back wages.

11. Due to failure of Management to pay the back-wages, the respondent No. 1 is seen to have given a notice of hunger strike. Consequent thereto, the Deputy Director of Education (respondent No. 3) held some meeting and discussion with Education Officer - respondent No. 2 and issued the communication, dated 23rd April, 1991, which is Annexure ‘C’ to the Writ Petition. Contents of this letter, when freely translated, read as follows:—

“The matter has been discussed in detail with Education Officer (Secondary) about salary payable to Sau. Vidyadevi Raut on 23rd April, 1991. Education Officer has been instructed to release salary and allowances by fixing the liability towards illegal termination on the Management. Education Officer (Secondary), Zilla Parishad, Nagpur, has accordingly issued appropriate orders.”

12. In compliance with the decision referred in above quoted letter, Education Officer - respondent No. 2 issued his communication, dated 23rd April, 1991, which is Annexure-D to the Writ Petition, in which he has issued consequential directions wherein he has fixed the liability on the Management to pay the salary and allowances of the period of unemployment, attributing to the Management the illegality in termination.

13. Management has filed present petition challenging the communications (Exhs. C and D) issued by respondent Nos. 3 and 2 respectively.

14. Grounds of challenge, as pressed into service, which can be summarized, are as follows:—

(a) The judgment of this Court, dated 19th April, 1990, (Exh. B to the petition) rendered in Writ Petition No. 548 of 1988, can, at the most, be construed to order reinstatement and has been so acted upon, however, cannot be construed to award back-wages;

(b) order of back-wages has to be explicit, and can never be by implication;

(c) the Education Officer had no authority or jurisdiction to sit in interpretation and construe the order to include therein what was not included;

(d) the Education Officer or the Deputy Director of Education cannot supplant the direction or a text, which is not present in the order, since such lack of direction will have to be considered to be a conscious judicial action, and not due to clerical error or omission;

(e) the directions issued by Deputy Director of Education as well as Education Officer are without following principles of natural justice.

(f) in view of the law as is laid down by Their Lordships of Supreme Court, reinstatement by setting aside an order of termination is not in itself a self-sufficient order of payment of back-wages, as such payment has to be a conscious judicial act. Moreover, the fact of the employee concerned not being gainfully employed, was required to be proved and could not be presumed.

15. Learned Advocate for petitioners placed reliance on following judgments:—

(i) Kendriya Vidyalaya Sangathan v. S.C Sharma, (2005) 2 SCC 363, (ii) Rajasthan S.R.T.C v. Ladulal Mali, (1996) 8 SCC 37, (iii) Rajasthan State Road Transport Corpn., v. Shyam Bihari Lal Gupta, (2005) 7 SCC 406, (iv) General Manager, Haryana Roadways v. Rudhan Singh., (2005) 5 SCC 591, (v) Indian Railway Construction Co. Ltd. v. Ajay Kumar., (2003) 4 SCC 579, (vi) M.P State Electricity Board v. Jarina Bee (Smt)..), (2003) 6 SCC 141, and (vii) Hindustan Motors Ltd. v. Tapan Kumar Bhattacharya, (2003) 6 SCC 41.

16. Learned Advocate for the petitioners urged that since the back-wages were not payable under the orders, however, by virtue of order of Education Officer had become payable. Petitioner had prayed for stay of letters (Annexs. C and D). This Court ordered payment of backwages as condition for stay. Consequently, arrears in a sum of Rs. 1,12,000-00 were deposited in this Court and the sum of Rs. 01,12,000-00 was paid to the respondent No. 1 against the respondent No. 1's furnishing surety and affidavit. Learned Advocate for petitioner prayed that the amount be ordered to be refunded with interest thereon at 10 per cent per annum.

17. Learned Advocate Mr. C.K Sable, who opposed the petition, urged that the order passed by the Education Officer is based on plain reading of, the Order of this Court passed in earlier Writ Petition. According to Mr. Sable, when the order of termination was set aside, essential consequence of reinstatement with full back-wages was the only fallout therefrom. He further urged that Education Officer and Deputy Director of Education are the authorities on whom the orders of the School Tribunal and this Court are binding. He, therefore, urged that no interference was called for in the Writ Petition.

18. Learned Advocate Mr. C.K Sable further and alternatively submitted that the act of withdrawal of amount by the respondent No. 1 was a bona fide act. Respondent No. 1 did not herself commit any overtact. It is only after this Court passed an order directing the deposit of the amount, the respondent No. 1 was permitted to withdraw the amount, instead of the amount to lie in the Court. He further pleaded that a proper latitude should be given to the fact that the respondent No. 1 is a poor teacher.

19. Learned Advocate further submitted that if at all recovery is to be ordered, it should be ordered without interest and only with sober instalments of Rs. 1000-00 or around that. Learned Advocate Mr. Sable, however, is not in a position to make a statement as to what is the exact carry-home salary and what shall be the monthly deduction.

20. This Court has given anxious consideration to rival submissions. Upon perusal of the precedents - reported judgments cited by the learned Advocate, this Court finds that in the ratio that has been ultimately laid down by the Lordships of Supreme Court in Kendriya Vidyalaya Sangathan v. S.C Sharma (supra), the Supreme Court held in Paras 14 to 16, which reads as follows:—

“14. In P.G.I of Medical Education and Research v. Raj Kumar this Court found fault with the High Court in setting aside the award of the Labour Court which restricted the back wages to 60% and directing payment of full backwages. It was observed thus: (SCC p. 57, para 9)

“9. The Labour Court being the final Court of facts came to a conclusion that payment of 60% wages would comply with the requirement of law. The finding of perversity or being erroneous or not in accordance with law shall have to be recorded with reasons in order to assail the finding of the Tribunal or the Labour Court. It is not for the High Court to go into the factual aspects of the matter and there is an existing limitation on the High Court to that effect.”

Again at para 12, this Court observed: (SCC p. 58)

“12. Payment of backwages having a discretionary element involved in it has to be dealt with, in the facts and circumstances of each case and no straitjacket formula can be evolved, though, however, there is statutory sanction to direct payment of backwages in its entirety.”

“15. The position was reiterated in Hindustan Motors Ltd. v. Tapan Kumar Bhattacharya, Indian Rly. Construction Co. Ltd. v. Ajay Kumar and M.P SEB v. Jarina Bee.

16. Applying the above principle, the inevitable conclusion is that the respondent was not entitled to full backwages which according to the High Court was a natural consequence. That part of the High Court order is set aside. When the question of determining the entitlement of a person to backwages is concerned, the employee has to show that he was not gainfully employed. The initial burden is on him. After and if he places materials in that regard, the employer can bring on record materials to rebut the claim. In the instant case, the respondent had neither pleaded nor placed any material in that regard.”

21. The ratio that now emerges is that upon setting aside termination, full backwages to follow is not the rule of law or precedent at present.

22. Omission on the part of any Court or Tribunal to incorporate a direction to pay the back-wages cannot be later on filled in any execution proceedings, or by any other executing authority who has not been vested by law any power to supplant any order or direction by denoting such deficiencies or omissions assuming that some such order ought to exist. In view that the position of law as reiterated in recent judgment in case of Kendriya Vidyalaya Sangathan (supra), which reiterates the clear proposition of law relying upon three earlier judgments, is a matter of binding precedent.

23. After hearing the case and before delivering the judgment, we had adjourned the case for a hearing on the aspect, for enabling the learned Advocate Mr. Sable to take instructions and to find out as to whether some settlement is possible where the Management can be asked to forgo part of the amount paid by it, however, learned Advocate Mr. Sable has informed the Court that the respondent No. 1 is not ready for any compromise on refund of amount.

24. The proposition advanced by learned Advocate that the order of backwages has to be express, and cannot be considered or construed to be passed by interpretation and necessary implication, is liable to be accepted. In view of this position, present petitioners' plea that the order of reinstatement, as can be read from the judgment of this Court, cannot be read to include order of back-wages is correct and deserves acceptance by this Court.

25. Moreover, this Court is not sitting in review at the behest of the teacher in the judgment passed in Writ Petition No. 584 of 1988 in 1990. The said judgment, which does not expressly grant back-wages, has to be respected and acted upon as it stands.

26. This Court finds that the submission of learned Advocate for the petitioner that an order has to be read as it stands, and none can read it to include something which is in its mind is acceptable. On the submission of learned Advocate that an order of backwages has to be explicit, and it cannot be inferred by implication, this Court finds that the ratio laid down by the Hon'ble Supreme Court in various cases supports the plea raised by the petitioner. In the result, on facts, this Court finds as follows:—

(a) That the judgment of this Court on which the respondent No. 1 has relied for the relief of reinstatement does not spell out that this Court has ordered “reinstatement with full backwages.”

(b) Absence of mention of payment of full backwages has to be read as a conscious judicial act.

(c) The authorities of the Education Department are not competent to infuse something in the operative order of this Court, and in the result, Annexs-B and C are illegal and without jurisdiction.

(d) Respondent No. 1 was not entitled to receive backwages.

(e) The amount received by the respondent No. 1 under the order of Court is liable to be refunded.

27. Considering the various aspect of the matter, this Court finds that the petition must succeed. However, insofar as recovery is concerned, considering the financial status, i.e, the respondent No. 1 is a Teacher, some latitude can be given. This could be in the nature of ordering recovery by monthly instalments of Rs. 2,500-00 (rupees two thousand five hundred only) per month from the salary and allowances, and in the event, the respondent No. 1 retires, before the recovery is completed, the balance be recoverable at once from the retiral benefits. The amount of Rs. 01,12,000-00 (rupees one lakh twelve thousand only) be paid by the respondent No. 1, and respondent No. 1 shall refund to the petitioner-Management the said amount along with simple interest thereon at the rate of six per cent per annum from the date of deposit of amount in this Court till the amount is fully recovered on the reducing balance basis.

28. In the result, Rule is made absolute in terms of Prayer Clause (i) which reads as follows:—

“(i) quash and set aside the impugned orders dated 23-4-1991 issued by the Education Officer and the Deputy Director of Education at Annexures C and D by a writ of Certiorari and/or any other appropriate writ, order or direction.”

29. Petitioner shall be entitled for recovery which be caused as indicated in foregoing para No. 21 which be got done by the respondent Nos. 2 to 4.

30. Parties shall bear respective costs.

Order accordingly.