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Judgment
K. Chandru, J.—Both writ petitions came to be posted on being specially ordered by the Hon''ble Chief Justice vide his order dated
02.08.2012. In W.P. No. 21246 of 2008, the petitioners challenge the Award passed by the Principal Labour Court, Chennai in I.D. No. 538 of
1997 dated 18.09.2007. By the impugned Award, the Labour Court declined to answer the reference in favour of the workmen and rejected the
industrial dispute raised by them, by holding that the 32 employees mentioned in the reference were not entitled to be made permanent. The Trade
union which raised the dispute did not file any writ petition. On the other hand, the 32 employees named in the order of reference issued by the
State Government in G.O. (D) No. 579, Labour and Employment Department dated 11.07.1997 have filed the writ petition. The writ petition was
admitted on 29.08.2008.
Pending W.P. No. 21246 of 2008, the first petitioner viz., C. Srinivasan @ Srinivasalu, S/o. Chinnappan raised a dispute before the Assistant
Commissioner of Labour-I, Chennai on the ground that he has been orally terminated from service on 18.08.2004. On a failure report being
furnished by the Conciliation Officer, the said petitioner filed a claim statement before the I Additional Labour Court, Chennai. The said claim
statement was taken on file as I.D. No. 211 of 2008 and notice was issued to the Management. The Management filed a counter statement before
the I Additional Labour Court, Chennai.
The workman examined himself as W.W. 1 and on the side of the Management, one V.K. Vasan was examined as M.W. 1. On the side of the
workman, two documents viz., Award passed in the earlier I.D. No. 538 of 1997 as well as the failure report given by the Conciliation Officer
were filed and marked as Exs. W1 and W2.
The labour Court, on an analysis of the materials placed before it, came to the conclusion that the earlier Award only negatived the question of
regularization, whereas, there is a finding by the Principal Labour Court that the workman had worked for more than 240 days and therefore, in
the absence of the Management not complying with the condition precedent for retrenchment of the workman as contemplated u/s 25-F of the
Industrial Disputes Act, the workman is entitled for reinstatement with 25% of back wages.
As against the Award dated 19.04.2011, the Management viz., Indian Drugs and Pharmaceuticals Limited, Nandambakkam, Chennai has filed
W.P. No. 21770 of 2011. This writ petition was admitted on 23.09.2011 and in the application for interim stay, only notice was ordered.
For the sake of convenience, the parties are referred to as the Workman and the Management as the case may be.
The Indian Drugs and Pharmaceuticals Limited (for short IDPL) had a factory at Nandambakkam and it was running a statutory canteen in its
factory. It was claimed by the workmen through their Union namely Desiya Pothu Thozhilar Orunginaippu with Registration No. CPT-1150 that
the canteen had 40 workers, who have been working for number of years starting from 1983 onwards. The Union raised a dispute claiming that
these workmen have been working for more than 240 days continuously and the Management had not confirmed their services. As the dispute
raised before the Assistant Commissioner of Labour Conciliation I did not materialize into any settlement, a failure report was sent to the State
Government.
The State Government by virtue of power u/s 10(1)(c) of the I.D. Act issued G.O. (D). No. 579, Labour and Employment Department, dated
11.07.1997, referring the dispute relating to 32 workers and directed the Principal Labour Court to consider the question as to whether the
demand of the Trade Union for regularisation of the 32 canteen employees was justified. In the Annexure A to the GO, the names of 32 workers
were set out. Sl. No. 3 relates to C. Srinivasan, who is the first petitioner in the first writ petition and also the first respondent in the second writ
petition. The said reference was registered as I.D. No. 538 of 1997 by the Labour Court and notice was issued to both sides.
Before the Labour Court, the General Secretary of the Union was examined as W.W. 1 and on their side, 6 documents were filed and marked
as Exs. W1 to W6. On the side of the Management, one V.K. Vasan was examined as M.W. 1 and on their side 7 documents were filed and
marked as Exs. M1 to M7.
Before the Labour Court, the Workmen filed I.A. No. 127 of 2001 for production of documents but the documents were not produced by the
Management on the ground that the workmen were engaged on casual ''off and on basis'' and were paid out of contingencies and no record of
their attendance was kept by the Management. M.W. 1, Senior Personnel Executive of the Management, during cross examination had stated that
no records or documents was issued to the workmen either by them or by the Canteen Committee and hence, he could not confirm the length of
service of the workmen. The Labour Court took adverse inference on the stand taken by the Management and held that it has no hesitation to hold
that the workmen were working for more than 240 days preceding the date of raising the dispute. But with reference to the claim for permanency,
the Labour Court held that even in respect of IDPL Limited, the Supreme Court vide its judgment reported in Indian Drugs and Pharmaceuticals
Ltd. Vs. Workman, Indian Drugs and Pharmaceuticals Ltd., has held that the daily wage employee has no right to seek regularisation and
regularization can be done only in accordance with the rules and not de hors the Rules. Even W.W. 1 had admitted that the workmen are only
casual employees. M.W. 1 in his evidence had stated the company has become a sick company and it has been referred for framing of a Scheme
before the BIFR. It was also admitted that only 30 employees were kept in the plant for maintenance apart from the supervisory personnel. Since
the company has become sick company and all the workers have gone out on Voluntary Retirement Scheme and other methods, the question of
granting them permanency will not arise.
The Labour Court also referred to the judgment of the Supreme Court in IDPL case (cited supra) and extracted the following passage from
the said judgment:-
The distinction between a temporary employee and a permanent employee is well settled. Whereas a permanent employee has a right to the post,
a temporary employee has no right to the post. It is only a permanent employee who has a right to continue in service till the age of superannuation
(unless he is dismissed or removed after an inquiry, or his service is terminated due to some other valid reason earlier). As regards a temporary
employee, there is no age of superannuation because he has no right to the post at all. Hence, it follows that no direction can be passed in the case
of any temporary employee that he should be continued till the age of superannuation.
Similarly, no direction can be given that a daily-wage employee should be paid salary of a regular employee. If an employee is not appointed
against a sanctioned post he is not entitled to any scale of pay.
In the light of these findings, the Labour Court held that the workmen, whose names are mentioned in the reference are not entitled to be made
permanent and the plea raised by the workmen was rejected. As noted already, the Trade Union which raised the dispute did not challenge the
Award. On the other hand, four of the workmen whose names are mentioned in the Annexure has filed the writ petition challenging the Award.
It was the contention of the workmen that once the Labour Court had drawn adverse inference for non-production of the records and a finding
was rendered that they had worked for more than 240 days preceding the order of reference, the Labour Court should have granted
regularisation. It is not clear as to how such a contention is maintainable, especially, when the Labour Court found that the plant at
Nandambakkam was not functioning and it is having only 30 workers along with supervisory staff and the company was referred to BIFR as it had
become sick company. Admittedly, the workmen were working only in the statutory canteen and when the plant itself is not functioning, the
question of the workmen being reinstated to a non-existent canteen does not arise. This Court do not find any case to interfere with the impugned
Award in I.D. No. 538 of 1997 dated 18.09.2007. Hence, W.P. No. 21246 of 2008 will stand dismissed.
This takes to the next writ petition filed by the Management of IDPL in W.P. No. 21770 of 2011, challenging the Award in I.D. NO. 211 of
2008 dated 19.04.2011 passed by the First Additional Labour Court, wherein and by which, the contesting first respondent was directed to be
reinstated with 25% of the back wages and with continuity of service. The ground raised by the Management was that the workman was only a
casual labour. In the light of the earlier Award passed by the Labour Court declining to grant the relief of regularisation, the finding given by the
Labour Court will operate as res judicata and therefore, the workman cannot set up a new plea for reinstatement. The findings recorded by the
Labour Court will also operate as res judicata against the claim raised by the first respondent workman.
However, Mr. K.V. Ananthakrishnan, learned counsel appearing for the workman contended that the findings rendered in the earlier Award
was in favour of the workman. In so far as the finding relates to the workman having completed 240 days of service, the management cannot go
behind the same. When once it is proved to the satisfaction of the Court that even in such case of casual employment, the workman who had
completed 240 days of service and had not been terminated in the manner known to law, the normal relief of reinstatement should have been
ordered. The Labour Court has correctly granted such relief.
Though the contention raised by the learned counsel for the workman with reference to the finding of fact regarding 240 days of service
rendered by the workman is accepted valid, on the other findings rendered by the Labour Court viz., the majority of the workmen have gone on
VRS and only 30 workers were kept for maintenance of the plant; the company has become sick and also the fact that the workman belong to the
category of 32 workers, who are working in the statutory canteen on casual employment, the Labour Court could not have granted re-instatement
to a non existent post.
In this context, it is necessary to refer to the judgment of the Supreme Court in Rajasthan Lalit Kala Academy Vs. Radhey Shyam, , wherein
the Supreme Court held that infraction of Section 25-F of the I.D. Act may make a termination invalid and in normal circumstances, the relief of
reinstatement and back wages must be ordered. But while doing so, it must be taken into account several factors like the manner and method of
selection, nature of appointment (ad hoc, daily wages, temporary, permanent etc.) period of service, delay in raising industrial dispute etc., must
also be taken into account.
Even assuming that the workman was employed for more than 240 days in a period of 12 calendar months, it did not automatically result in the
workman getting the relief of reinstatement with back wages as held by the Supreme Court reported in Uttaranchal Forest Development
Corporation Vs. M.C. Joshi, . In that case, the Court held that since appointments were not made in terms of the statutory rules, compensation
alone was directed to be paid. Similar view was taken by the Supreme Court in the decision reported in Madhya Pradesh Administration Vs.
Tribhuban, , wherein the Supreme Court held that relief of reinstatement cannot be automatically granted and compensation was directed to be
paid.
In the light of the same, the impugned Award in I.D. No. 211 of 2008 dated 19.04.2011 cannot be upheld in its entirety. As it is found that the
workman was only a casual worker and that the factory has been referred to as sick industry and the regular workmen have left service on VRS
and there being no canteen running in the establishment, the workman cannot be reinstated in service. He is only entitled for compensation of Rs.
50,000/- (Rupees Fifty Thousand only) in lieu of reinstatement. The petitioner viz., IDPL is directed to pay a sum of Rs. 50,000/- to the first
respondent workman within a period of eight weeks from the date of receipt of a copy of this order. In the result, W.P. No. 21246 of 2008 stands
dismissed. W.P. No. 21770 of 2011 stands partly allowed to the extent indicated above. No costs. Connected miscellaneous petitions are closed.