Court’s decision
The Delhi High Court partly allowed a writ petition filed by Punjab & Sind Bank, upholding the finding of illegal termination of a temporary sub-staff employee but modifying the relief granted by the Central Government Industrial Tribunal.
Justice Shail Jain held that the workman had completed 240 days of continuous service and that termination without compliance with Section 25F of the Industrial Disputes Act, 1947 was illegal. However, reinstatement was substituted with lump-sum compensation of ₹11,00,000, and the direction of regularisation was set aside as beyond the scope of reference .
Facts
The respondent was initially appointed as a temporary peon in 1988. After intermittent engagement and earlier proceedings, he was reappointed in 1996 as a temporary Orderly/Daftari at the Mussoorie branch of the nationalised bank.
On 11.05.2003, his services were terminated without notice or retrenchment compensation. He raised an industrial dispute under Section 2A of the Industrial Disputes Act. Following conciliation failure, the dispute was referred to the Central Government Industrial Tribunal to determine whether termination without notice and compensation was legal and justified.
The Tribunal held the termination void ab initio, directed reinstatement with continuity of service, and ordered regularisation, though denying back wages .
Issues
The High Court examined:
- Whether the workman had completed 240 days of continuous service in the twelve months preceding termination.
- Whether delay of approximately four years in raising the dispute vitiated the reference.
- Whether reinstatement was an appropriate relief after two decades.
- Whether the Tribunal could direct regularisation despite limited terms of reference.
Petitioner’s arguments
The bank argued that the dispute suffered from delay and laches. It contended that 240 days must be computed for the twelve months immediately preceding 11.05.2003 and not calendar-year wise.
It submitted that the burden of proof lay on the workman and that the Tribunal wrongly shifted the onus. Reliance was placed on Supreme Court precedents to argue that reinstatement is not automatic in cases of daily-wage or temporary employees.
It was further argued that regularisation was beyond the scope of reference and contrary to settled law governing public employment.
Respondent’s arguments
The workman maintained that he had continuously worked from 1996 to 2003 and that documentary evidence, admissions in pleadings, and communications recommending regularisation established completion of 240 days.
It was contended that the bank failed to produce muster rolls and attendance registers despite specific directions, justifying adverse inference.
On relief, reliance was placed on recent Supreme Court precedent asserting reinstatement as the normal rule where statutory violation is established.
Analysis of the law
The Court examined Section 25B and Section 25F of the Industrial Disputes Act. It reaffirmed that 240 days must be computed for the twelve months preceding termination.
However, once the workman entered the witness box and produced available documentary material, and called upon the employer to produce statutory records, the burden shifted. Non-production of muster rolls permitted adverse inference under settled precedent.
The Court rejected the plea of delay, holding that the Industrial Disputes Act prescribes no limitation period and delay alone does not invalidate reference.
Precedent analysis
The Court relied on Ajaib Singh v. Sirhind Cooperative Marketing Society to hold that limitation principles do not automatically bar industrial disputes.
It applied H.D. Singh v. Reserve Bank of India and R.M. Yellatti v. Assistant Executive Engineer to affirm adverse inference for non-production of records.
On relief, the Court examined B.S.N.L. v. Bhurumal, Jagbir Singh v. Haryana State Agriculture Marketing Board, and Telecom District Manager v. Keshab Deb, which recognise compensation as an appropriate substitute for reinstatement in long-pending daily-wage cases.
For regularisation, reliance was placed on Secretary, State of Karnataka v. Uma Devi, and Tata Iron and Steel Company Ltd., reiterating that tribunals cannot travel beyond reference or grant regularisation in public employment without due process.
Court’s reasoning
The Court found that evidence showed uninterrupted engagement from 1996 to 2003, including payment of arrears under a bipartite settlement and recommendations by branch managers. The bank’s failure to produce muster rolls justified adverse inference.
Termination was admittedly effected without notice or retrenchment compensation, violating Section 25F.
However, considering the 23-year lapse, proximity to superannuation, and temporary nature of employment, reinstatement was deemed impractical.
The Tribunal exceeded jurisdiction by directing regularisation, as the reference was confined to legality of termination.
Conclusion
The High Court upheld the finding of illegal termination but modified relief. Instead of reinstatement, the workman was awarded ₹11,00,000 as consolidated compensation, payable within three months with 9% interest upon default.
The direction for regularisation was quashed as ultra vires the terms of reference .
Implications
This judgment clarifies four critical principles in industrial jurisprudence:
• Completion of 240 days shifts evidentiary burden where employer withholds records.
• Delay alone does not defeat industrial adjudication.
• Reinstatement is not automatic in long-pending daily-wage cases.
• Industrial Tribunals cannot grant regularisation beyond scope of reference, particularly in public sector employment.
The ruling reflects a balanced approach—upholding statutory protection while moulding equitable relief consistent with contemporary Supreme Court jurisprudence.
Case law references
- Ajaib Singh v. Sirhind Cooperative Marketing Society (1999) – No statutory limitation for industrial disputes.
- H.D. Singh v. Reserve Bank of India (1985) – Adverse inference for non-production of muster rolls.
- R.M. Yellatti v. Assistant Executive Engineer (2006) – Workman’s oral evidence sufficient when employer withholds records.
- B.S.N.L. v. Bhurumal (2014) – Compensation may replace reinstatement in daily-wage cases.
- Jagbir Singh v. Haryana State Agriculture Marketing Board (2009) – Reinstatement not automatic in procedural violations.
- Secretary, State of Karnataka v. Uma Devi (2006) – No regularisation without constitutional recruitment process.
FAQs
1. Is reinstatement automatic if termination violates Section 25F?
No. Courts may substitute reinstatement with compensation, especially in long-pending or daily-wage cases.
2. Who bears the burden of proving 240 days of service?
Initially the workman. However, if the employer fails to produce attendance records within its custody, adverse inference may be drawn.
3. Can an Industrial Tribunal order regularisation?
Only if the issue forms part of the reference and complies with constitutional recruitment norms. Otherwise, such directions are beyond jurisdiction.