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AMICUS AI
Citation Codes
Neutral Citations
2007 INSC 401
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • Section 11-A of the 1947 Act
  • Section 25-B of the Act
  • Section 25-F read with Section 25-B of the Industrial Disputes Act, 1947
  • Section 25-F of the Act
  • Section 25-N of the Act
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Cites
Cited by
Citation Codes
Neutral Citations
2007 INSC 401
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • Section 11-A of the 1947 Act
  • Section 25-B of the Act
  • Section 25-F read with Section 25-B of the Industrial Disputes Act, 1947
  • Section 25-F of the Act
  • Section 25-N of the Act
Smart Summary

Factual and Procedural Background

The respondent was engaged as a daily-wage worker. He rendered 145 days of work in Sub-Division 2, Panipat between October 1994 and February 1995 and 90 days in Sub-Division 3 between March 1995 and July 1995. His services were thereafter terminated.

An industrial dispute challenging the termination was referred to the Industrial Tribunal-cum-Labour Court, Panipat as Reference No. 59 of 1999. By award dated 28 February 2003, the Tribunal treated the service in both sub-divisions as one continuous period under Sections 25-F and 25-B of the Industrial Disputes Act, 1947, and ordered reinstatement with continuity of service and full back wages from 14 September 1995 (date of demand notice).

The employer’s writ petition against the award was dismissed, prompting the present appeal by special leave before the Supreme Court of India.

Legal Issues Presented

  1. Whether periods of employment in two separate sub-divisions, each constituting a distinct establishment, could be aggregated to confer “continuous service” under Section 25-B of the Industrial Disputes Act, 1947.
  2. Whether, in the circumstances, the Tribunal was justified in granting reinstatement with continuity of service and full back wages under Section 11-A of the Act.

Arguments of the Parties

The opinion does not contain a detailed account of the parties' legal arguments.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Union of India v. Jummasha Diwan (2006) 8 SCC 544 A worker employed in different establishments under the same overall employer does not acquire “continuous service” when the establishments have separate administrative setups and recruitment constitutes fresh employment. Relied upon to hold that the respondent’s work in two sub-divisions could not be treated as one continuous period, negating entitlement to reinstatement based on aggregated service.

Court's Reasoning and Analysis

  • The Court noted that Sub-Division 2 and Sub-Division 3 were distinct establishments; a common controlling authority does not merge them into a single unit for purposes of Sections 25-B and 25-F.
  • The respondent produced no letters of appointment linking the two sub-divisions or showing appointment by the same authority. In their absence, each engagement was treated as a separate employment.
  • If separate establishments were nonetheless treated as one, an establishment effecting retrenchment might be unaware of service rendered elsewhere, making compliance with Section 25-F impossible.
  • Quoting Union of India v. Jummasha Diwan, the Court reaffirmed that employment in different establishments under a statutory authority does not amount to “continuous service.”
  • Under Section 11-A, reinstatement with back wages is not automatic; relief depends on multiple factors, including nature of appointment. The respondent was a daily-wage worker who had worked only during 1994-95 for a short duration.
  • The Tribunal thus erred in awarding reinstatement with full back wages nearly eight years after the brief period of service.

Holding and Implications

Appeal Allowed. The Supreme Court set aside the direction for reinstatement with continuity of service and full back wages. In lieu of reinstatement, the respondent is to be paid Rs 25,000, with no order as to costs.

Implications: The decision re-emphasizes that service in separate establishments under the same overarching authority cannot be combined to establish “continuous service” for retrenchment benefits, and that reinstatement with back wages is a discretionary relief contingent on the specific facts, particularly where the worker’s engagement was of short duration and on a daily-wage basis.

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    Haryana Urban Development Authority v. Om Pal .

    S.B Sinha, J.— Leave granted.

    2. The respondent herein was appointed as a daily wager. From October 1994 to February 1995, he worked for a period of 145 days in Sub-Division 2, Panipat. He, however, worked in Sub-Division 3 for a period of 90 days from March 1995 to July 1995. His services were terminated. An industrial dispute was raised questioning validity of the said order of termination. The said industrial dispute was referred by the appropriate Government to the Industrial Tribunal-cum-Labour Court, Panipat, for its determination. It was registered as Reference No. 59 of 1999. By an award dated 28-2-2003, the Industrial Court on the premise that the services rendered by the respondent in both the sub-divisions should be counted for the purpose of Section 25-F read with Section 25-B of the Industrial Disputes Act, 1947, directed his reinstatement with continuity of service and full back wages from the date of demand notice i.e 14-9-1995. A writ petition filed thereagainst by the appellant herein was dismissed. The appellant has, therefore, filed this appeal by special leave.

    3. The short question which arises for consideration by us in this appeal is as to whether in the aforementioned fact situation, the Industrial Tribunal-cum-Labour Court was justified in directing reinstatement of the respondent with full back wages and continuity of service. It has not been denied or disputed that the two sub-divisions constituted two different establishments. Only because there is one controlling authority, the same by itself would not mean that the establishments were not separate.

    4. The respondent did not produce his offers of appointment before the Industrial Tribunal-cum-Labour Court. If offers of appointment had been issued in his favour by the two sub-divisions separately, the same ipso facto would lead to the conclusion that they were separate and distinct. If his appointment was only on the basis of entry in the muster roll(s), the designation of the authority who was authorised to appoint him as a daily wager would be the determinative factor. It is not the case of the respondent that he was appointed in both the establishments by the same authority.

    5. The Industrial Tribunal-cum-Labour Court unfortunately did not go into the said question at all. If both the establishments are treated to be one establishment for the purpose of reckoning continuity of service within the meaning of Section 25-B of the Act, as was held by the Tribunal, a person working at different points of time in different establishments of the statutory authority, would be entitled to claim reinstatement on the basis thereof. However, in that event, one establishment even may not know that the workman had worked in another establishment. In absence of such a knowledge, the authority retrenching the workman concerned would not be able to comply with the statutory provisions contained in Section 25-F of the Act. Thus, once two establishments are held to be separate and distinct having different cadre strength of the workmen, if any, we are of the opinion that the period during which the workman was working in one establishment would not enure to his benefit when he was recruited separately in another establishment, particularly when he was not transferred from one sub-division to the other. In this case he was appointed merely on daily wages.

    6. In Union of India v. Jummasha Diwan (2006) 8 SCC 544 this Court opined:

    “There are several establishments of the Railway Administration. If a workman voluntarily gives up his job in one of the establishments and joins another, the same would not amount to his being in continuous service. When a casual employee is employed in different establishments, maybe under the same employer e.g the Railway Administration of India as a whole, having different administrative set-ups, different requirements and different projects, the concept of continuous service cannot be applied and it cannot be said that even in such a situation he would be entitled to a higher status being in continuous service. It is not in dispute that the establishment of Appellant 3 herein had started a project. His recruitment in the said establishment would, therefore, constitute a fresh employment. In a case of this nature, the respondent would not be entitled to his seniority. If the project came to a close, the requirements of Section 25-N of the Act were not required to be complied with.”

    7. Moreover, it is also now well settled that despite a wide discretionary power conferred upon the Industrial Courts under Section 11-A of the 1947 Act, the relief of reinstatement with full back wages should not be granted automatically only because it would be lawful to do so. Grant of relief would depend on the fact situation obtaining in each case. It will depend upon several factors, one of which would be as to whether the recruitment was effected in terms of the statutory provisions operating in the field, if any.

    8. The respondent worked for a very short period. He only worked, as noticed hereinbefore, in 1994-95. The Industrial Tribunal-cum-Labour Court, therefore, in our opinion committed an illegality, while passing an award in the year 2003, directing the reinstatement of the respondent with full back wages. Although we are of the opinion that the respondent was not entitled to any relief, whatsoever, we direct the appellant to pay him a sum of Rs 25,000.

    9. This appeal is allowed to the aforementioned extent. However, in the facts and circumstances of this case, there shall be no order as to costs.

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    Comments

    Haryana Urban Development Authority v. Om Pal .
    (Apr 10, 2007)