Court’s decision
The Bombay High Court upheld the Labour Court’s direction granting reinstatement with continuity of service to the workman whose employment had been terminated without complying with statutory safeguards. The Court held that the employer never disputed the fact of employment and therefore could not later deny the relationship during adjudication. It further held that the Labour Court had correctly appreciated the evidence, including documentary records showing continuous service, and rightly concluded that the termination violated the mandatory conditions of retrenchment. The High Court found no perversity or jurisdictional error and refused to interfere in the award under its supervisory jurisdiction.
Facts
The dispute arose when the workman approached the Labour Court alleging illegal termination of service after having worked continuously for several months under the employer. He asserted that he had been engaged as a manual labourer, assigned regular duties, and paid wages on a monthly basis. According to him, the employer abruptly terminated his service without notice, without retrenchment compensation, and without following the industrial-adjudication framework. The employer filed a written statement but notably did not deny the existence of an employer–employee relationship. The Labour Court, after appreciating oral and documentary evidence, passed an award granting reinstatement with continuity of service.
Issues
The High Court considered the following issues:
- Whether the Labour Court erred in holding that the employer–employee relationship stood proved, given that the employer had not specifically denied it in its written statement.
- Whether the workman had established continuous service to attract statutory protection against illegal retrenchment.
- Whether the Labour Court had committed any jurisdictional error warranting interference under Article 226 or 227.
- Whether reinstatement with continuity of service was an appropriate remedy in the circumstances of the case.
Petitioner’s arguments
The petitioner-employer submitted that the workman had not discharged the burden of proving his employment and length of service and that mere oral assertions could not establish continuous service. It was argued that documentary evidence produced by the workman did not conclusively indicate that he had been employed for more than 240 days. The petitioner further contended that the Labour Court had mechanically accepted the workman’s version and failed to consider inconsistencies in his testimony. The employer urged that reinstatement was excessive and that the High Court should intervene to prevent injustice and correct errors of appreciation committed by the Labour Court.
Respondent’s arguments
The workman argued that once the employer failed to specifically deny the employment relationship, the law presumed the fact to be admitted. He relied on documentary records—including wage receipts and other internal papers—showing that he had worked continuously. The workman contended that the Labour Court had correctly concluded that the termination was in violation of legal requirements. He argued that the award of reinstatement was justified because he had been removed without notice, inquiry or retrenchment compensation. It was further contended that the employer had not produced any contrary evidence or muster rolls to rebut the documents placed on record.
Analysis of the law
The Court reiterated a settled legal principle: when a party does not specifically deny a fact in pleadings, it must be treated as admitted. This applies with greater force in industrial adjudication where the employer controls employment records. The Court emphasised that the burden of proof is flexible in labour matters and shifts depending on who possesses the relevant documents. Once the workman produced prima facie evidence, the employer’s failure to produce muster rolls, registers, or wage sheets significantly weakened its case. The Court observed that in termination cases, compliance with statutory conditions is mandatory and failure to follow procedure renders termination illegal.
Precedent analysis
Industrial burden-of-proof jurisprudence
The Court relied on established precedents that hold employers responsible for producing employment records within their exclusive control. Failure to produce such records creates an adverse inference.
Principles of non-denial in pleadings
Courts have consistently held that facts not specifically denied are deemed admitted. The judgment reaffirmed this principle by accepting employment as proved.
Reinstatement as a remedy in illegal termination
The judgment aligns with prior rulings holding that reinstatement with continuity of service is the appropriate remedy when termination violates statutory safeguards, unless exceptional circumstances justify alternative relief.
Court’s reasoning
The Court noted that the employer did not deny the employment relationship in the written statement, which was fatal to its defence. It found that the Labour Court had relied on the workman’s documents, oral testimony, and the employer’s failure to rebut the same. The Court held that the Labour Court’s findings were based on proper appreciation of evidence and were not perverse. It also reiterated that the supervisory jurisdiction under Article 227 is limited to correcting jurisdictional errors, not re-evaluating evidence. Since the award was lawful and supported by material, the High Court refused to interfere and upheld reinstatement with continuity of service.
Conclusion
The Bombay High Court upheld the Labour Court’s award, reaffirming that fairness and statutory compliance lie at the heart of industrial justice. It held that once employment is admitted—or not denied—the employer cannot later dispute foundational facts. The Court found that the workman had been terminated without notice or retrenchment compensation in violation of mandatory legal requirements. Since the Labour Court’s conclusions were well supported by the record, reinstatement was the correct remedy. The writ petition was dismissed, and the award was confirmed.
Implications
This judgment strengthens worker protections by clarifying that employers must expressly deny employment if they wish to contest it. It reinforces that industrial adjudication must be fair, transparent, and supported by documents. Employers who fail to maintain or produce records risk adverse findings. The ruling also confirms that reinstatement continues to be the primary remedy in cases of illegal termination. For workmen, it affirms that courts will adopt a worker-friendly approach when procedural lapses are evident. The judgment will guide future disputes involving non-denial of employment and burden of proof.
Summary of referred legal principles
Adverse inference rule
When employers fail to produce records exclusively in their possession, courts may presume the workman’s version to be correct.
Non-denial equals admission
Labour jurisprudence consistently holds that facts not specifically denied must be treated as admitted.
Reinstatement jurisprudence
Courts have repeatedly held reinstatement as the natural remedy for illegal termination, reaffirmed in this judgment.
FAQs
1. What happens if the employer does not deny employment in its pleadings?
Such non-denial amounts to admission, making it significantly easier for the workman to prove his case.
2. Is reinstatement always granted in illegal termination cases?
Generally yes, unless special circumstances justify compensation instead.
3. Can the High Court re-evaluate evidence under Article 227?
No. Its role is limited to correcting jurisdictional errors, not reassessing factual findings.
