As per case facts, a workman raised a dispute claiming wrongful retrenchment after his services were terminated orally. He asserted continuous employment for a significant period and violation of industrial ...
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CASE NO.:
Appeal (civil) 5969 of 2004
PETITIONER:
Rajasthan State Ganganagar S. Mills Ltd.
RESPONDENT:
State of Rajasthan & Anr.
DATE OF JUDGMENT: 13/09/2004
BENCH:
ARIJIT PASAYAT & C.K. THAKKER
JUDGMENT:
J U D G M E N T
(Arising out of SLP (C) No.11658/2003)
ARIJIT PASAYAT, J.
Leave granted.
The respondent No.2 \026 Bhagwan Das (hereinafter referred to as the
'workman') raised a dispute which was referred by the Government of
Rajasthan to the Labour Court, Sri Ganga Nagar, Rajasthan. The dispute
of the workman, inter alia, was to the effect that though he was
appointed as a daily- wages employee on 1st March, 1990 and continued up
to 15th July, 1992 without break. His services were terminated by oral
order. It was pleaded that the dispensation of service amounted to
retrenchment and since the provisions of Section 25 (F), (G) and (H) of
the Industrial Disputes Act, 1947 (in short the 'Act') were violated he
was entitled to the reinstatement and consequential benefits. The
present appellant (hereinafter referred to as the 'employer') refuted
the allegations. It was specifically stated that the workman had not
really worked continuously from 01.03.1990 to 15.7.1992 as pleaded. On
the contrary, the workman was engaged whenever there was work which was
of casual nature. His total period of engagement during the years 1990,
1991 and 1992 was 56= days, 64 days and 122= days respectively. He
had worked for a total period of 138 days during the preceding 12
months. Whenever there was an additional work, the engagement was
done. Keeping in view the scope for additional engagement persons were
engaged and there was no violation of any provision of the Act. The
Labour Court came to hold that the total period during which the
workman rendered work was more than 240 days. Though specific direction
was given to the employer to produce the muster roll for the period
from 17.6.1991 to 12.11.1991, the same was not produced. Accordingly
it was held that the sanctioned days and the days covered by the muster
roll, which was not produced, taken together indicated that the workman
had worked for more than 240 days. Accordingly direction was given to
reinstate the workman and for paying 30% of the back wages.
The order was challenged before the Rajasthan High Court by
filing a Civil Writ Application bearing No. 2730/2002. A learned Single
Judge at the first instance dismissed the Writ Petition on the ground
that muster roll for a particular period was not produced. It was held
that no interference was called for considering the limited
jurisdiction under Articles 226 and 227 of the Constitution of India,
1950 (in short the 'Constitution'), more particularly when only 30% of
the back wages had been awarded. A Civil Special Appeal was filed
which was also dismissed by the Division Bench holding that since the
retrenchment was found to be invalid on appreciation of evidence and
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for non production of relevant document; no interference is called for.
In support of the appeal learned counsel for the appellant
submitted that both the Labour Court and the High Court fell into error
by placing burden on the employer to prove that the concerned workman
has not worked for more than 240 days. The Labour Court failed to
notice that even if the period for which the muster roll was not
produced is reckoned; then also the requirement of 240 days work during
twelve months preceding alleged date of termination is not established.
Per contra, learned counsel for the respondent-workman submitted
that as the Labour Court has taken into account all relevant factors,
no interference is called for. According to him the workman has
clearly established that he worked for more than 240 days during the
relevant period.
It was the case of the workman that he had worked for more than
240 days in the concerned year. This claim was denied by the
appellant. It was for the claimant to lead evidence to show that he
had in fact worked up to 240 days in the year preceding his
termination. He has filed an affidavit. It is only his own statement
which is in his favour and that cannot be regarded as sufficient
evidence for any Court or Tribunal to come to the conclusion that in
fact the claimant had worked for 240 days in a year. These aspects were
highlighted in Range Forest Officer v. S.T. Hadimani (2002 (3) SCC 25).
No proof of receipt of salary or wages for 240 days or order or record
in that regard was produced. Mere non-production of the muster roll for
a particular period was not sufficient for the Labour Court to hold
that the workman had worked for 240 days as claimed. Even if that
period is taken into account with the period as stated in the affidavit
filed by the employer the requirement prima facie does not appear to be
fulfilled. The following period of engagement which was accepted was 6
days in July 1991, 15 = days in November 1991, 15= days in January
1992, 24 days in February 1992, 20= days in March 1992, 25 days in
April 1992, 25 days in May 1992, 7= days in June 1992 and 5= days in
July 1992. The Labour Court demanded production of muster roll for a
period of 17.6.1991 to 12.11.1991. It included this period for which
the muster roll was not produced and come to the conclusion that the
workman had worked for more than 240 days without indicating as to the
period to which period these 240 days were referable.
In our view the Labour Court and the High Court have failed to
consider the statutory requirements in their proper perspective. One
of the stands taken by the employer was that the engagement was made
keeping in view the temporary needs and it was seasonal in character.
No definite finding was recorded by the Labour Court or the High Court
in that regard.
We, therefore, remit the matter to the Labour Court to consider
the evidence and come to a definite conclusion as to whether the
workman had worked for 240 days during the period claimed. While
considering the matter afresh, the aspect of need of engagement shall
also be examined. If the engagement is found to be not for 240 days
during the relevant period, then this aspect may not be considered. In
case the Labour Court comes to a finding in the affirmative its
original order shall be maintained subject to consideration of the
seasonal need aspect. If its answer is in negative the Labour Court
shall pass appropriate orders.
The Appeal is accordingly disposed of. No costs.
This landmark Supreme Court judgment in Rajasthan State Ganganagar S. Mills Ltd. v. State of Rajasthan & Anr., delivered on September 13, 2004, provides crucial clarity on the Industrial Disputes Act, 1947, particularly concerning the burden of proof in retrenchment cases. Both the petitioner (Rajasthan State Ganganagar S. Mills Ltd.) and the respondent (Bhagwan Das, the workman) have had their case meticulously documented and analyzed on CaseOn, highlighting the intricate legal considerations involved.
The case originated from a dispute raised by Bhagwan Das, a workman, who claimed he was appointed as a daily-wage employee on March 1, 1990, and worked continuously until July 15, 1992, when his services were terminated orally. He argued that this termination constituted illegal retrenchment, violating Sections 25(F), (G), and (H) of the Industrial Disputes Act, 1947, as he had completed more than 240 days of continuous service. Consequently, he sought reinstatement with full consequential benefits.
The employer, Rajasthan State Ganganagar S. Mills Ltd., refuted these claims. They contended that the workman's engagement was sporadic and casual, dependent on the availability of work. They provided specific figures for his engagement: 56.5 days in 1990, 64 days in 1991, and 122.5 days in 1992, totaling 138 days in the 12 months preceding termination, thereby denying that he had completed the requisite 240 days of continuous service.
The central question before the Supreme Court was whether the Labour Court and the High Court erred in placing the burden of proof on the employer to demonstrate that the workman had not completed 240 days of continuous service. Furthermore, the Court had to determine if the retrenchment was indeed invalid based on the evidence presented and the legal requirements of the Industrial Disputes Act, 1947.
At the heart of this dispute lies the concept of 'continuous service' as defined under the Industrial Disputes Act, 1947. Section 25B of the Act stipulates that a workman is deemed to be in continuous service for a period of one year if they have worked for not less than 240 days in the preceding 12 calendar months. Sections 25F, 25G, and 25H outline the conditions precedent to retrenchment, requiring notice or payment in lieu thereof, compensation, and adherence to the 'last come, first go' principle. Non-compliance with these provisions renders retrenchment illegal.
Crucially, the legal precedent, particularly highlighted in Range Forest Officer v. S.T. Hadimani (2002 (3) SCC 25), emphasizes that it is incumbent upon the claimant (the workman) to lead evidence proving they have worked for 240 days in the year preceding their termination. Mere oral assertion or non-production of documents by the employer is not, by itself, sufficient to discharge this burden.
The Labour Court, after reviewing the evidence, concluded that the workman had rendered service for more than 240 days. A key factor in this decision was the employer's failure to produce the muster roll for a specific period (June 17, 1991, to November 12, 1991), despite a direct order. The Labour Court reasoned that combining the days proven with the days from the non-produced muster roll indicated over 240 days of work, and accordingly ordered reinstatement with 30% back wages.
The employer challenged the Labour Court's decision before the Rajasthan High Court. Both a Single Judge and a Division Bench dismissed the appeals, primarily upholding the Labour Court's view that the non-production of the muster roll for the specified period was a critical factor in determining the invalidity of the retrenchment. They found no grounds to interfere with the Labour Court's exercise of limited jurisdiction under Articles 226 and 227 of the Constitution.
The Supreme Court, however, took a different view. It observed that both the Labour Court and the High Court had erred by misplacing the burden of proof. The Court reiterated that the responsibility to prove 240 days of continuous service lay squarely with the workman. The mere non-production of a muster roll by the employer for a particular period was not sufficient to conclude that the workman had met the 240-day threshold, especially without any other concrete evidence of salary receipts or attendance records.
The Supreme Court critically noted that even if the period for which the muster roll was not produced was accounted for, and added to the days admitted by the employer, it was still unclear whether the total would definitively reach 240 days within the *relevant 12-month period* preceding the termination. The Court also highlighted that the employer's contention regarding the seasonal nature of the work, which would affect the permanency of engagement, had not been adequately addressed by the lower courts. For legal professionals looking for a quick understanding, CaseOn.in's 2-minute audio briefs can be an invaluable resource to grasp such nuanced points of law and specific rulings.
In light of these observations, the Supreme Court set aside the decisions of the Labour Court and the High Court. The matter was remitted back to the Labour Court for a fresh consideration. The Labour Court was directed to:
The Supreme Court clarified that if the Labour Court, upon fresh examination, found that the workman had *not* worked for 240 days during the relevant period, the original reinstatement order would stand revoked. Conversely, if 240 days were proven, the original order would be maintained, but subject to a fresh consideration of the seasonal nature of the work. The appeal was thus disposed of without costs.
This Supreme Court judgment is an essential read for lawyers, HR professionals, and law students specializing in labor law for several reasons:
Understanding this ruling is vital for navigating the complexities of the Industrial Disputes Act, 1947, particularly concerning employee rights related to retrenchment and the evidentiary requirements in such disputes.
All information provided in this article is for informational purposes only and does not constitute legal advice. While efforts have been made to ensure accuracy, readers should consult a qualified legal professional for advice on specific legal issues.
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