ORDER
1. The petitioners-workmen are aggrieved by the common award passed by the second respondent-Additional Labour Court in I.D. Nos. 205 to 212 of 1994, dated 5-11-1997, they have filed these writ petitions before this Court challenging the same urging various legal contentions.
2. The workmen raised an industrial dispute by presenting their separate claim petitions under Section 10(4-A) of the Industrial Disputes Act, 1947 (Karnataka Amendment) Act, 1988 (in short, ‘the Act’) challenging the action of the management in refusing employment to them during the month of May and June 1992, urging various legal contentions contending that, first respondent-management had appointed them. Prior to the appointment order dated 10-6-1991 copy of the appointment order vide Annexure-C they have worked as Trainee Machine Operators’ in the first respondent-management for one year and thereafter they were appointed as Machine Operators in permanent posts on probation for six months. It is also further stated in the appointment orders issued to the petitioners similar to Annexure-C, after they were selected and appointed as Machine Operators, against the regular permanent vacancies posts. Prior to the appointment orders were issued the management published in the daily newspaper dated 2nd April, 1990 in Deccan Herald inviting applications from the experienced candidates to the posts referred to above along with other posts. It is contended by the workmen that the management refused employment to them during the month of May and June 1992 without any reason or rhyme whatsoever.
3. Individually, the workmen submitted representation similar to the Annexure-D to the management stating that they have been orally refused employment without assigning any reason and further, they have stated that they were ready and willing to report for the work in the company. In the claim statement they have contended that, action of the management is in violation of Section 2(oo) of the Act as they have continuously worked for almost one and half years without break in service from the date of their regular appointment. Further, their, appointments were made against the existing permanent vacant posts in the company. It is also contended that, non-compliance of statutory provisions of Section 25-F, clauses (a) and (b) and Section 25-N of Chapter V-B of the Act has rendered the action of the management in refusing employment to them as void ab initio in law. It is further contended that, the statutory requirements as contemplated under Chapters V-A and V-B of the Act as the same have also not been complied with, even though they are applicable to the first respondent-management. Therefore, the refusal of employment to the petitioners is bad in law. It is also alleged that the action of the management in refusing employment to the workmen is a clear case of unfair labour practice as defined under Section 2(ra) of the Act. Further, it is stated that several junior employees to the petitioners have been continued in the employment of the
company. Therefore, they requested the Additional Labour Court to adjudicate their claim and pass an award of reinstatement, back wages, continuity of service and other consequential benefits.
4. The claim of the petitioners was seriously disputed by the management by filing the counter statement vide Annexure-R1 before the Labour Court. It is stated that due to the disintegration of erstwhile USSR, the company’s export market suffered very much. The exports of the company drastically fell from 139.86 lakhs in the year 1989-90 to a mere Rs. [1,075] lakhs in the year 1992-93. Added to the disintegration of the USSR, the recession in the Machine Tool Industry also affected the business of the company. In page 2 unnumbered para 2 of the counter it is stated that, in the situation referred to above, the company was not able to provide the work even to the regular employees to the full capacity. The probationers who were engaged having regard to the business activities contemplated prior to disintegration of erstwhile USSR proved to be wrong having regard to the fact of sudden political development in the erstwhile USSR. Therefore, the posts for which the probationers were engaged were no longer available for confirmation and therefore, the company had to discontinue the confirmation of probationers since there being no future prospects of their being employed and due to this some probationers left on their own accord and some were requested to leave having regard to the difficulty of the management.
5. It is further stated by the first respondent-management, non-confirmation of probationers/workmen was due to circumstances explained above and for the bona fide reason and same is not interfered with by the Additional Labour Court as the claim of the petitioners was not maintainable before the Additional Labour Court. It is further stated that they were gainfully employed. In page 3, unnumbered para 3 of the counter statement, it is stated that management had not refused employment to the petitioners, they were orally told about the difficulty of the management and the future prospects of the company being very bleak. Understanding this position, the petitioners left the duties but raised industrial disputes stating that they were refused employment by the first respondent-management. It is further contended that, probationers have no right of employment. At para 5 of the counter in the last sentence of the paragraph it is stated that, since probationary period specified in the appointment orders itself came to an end and they were not confirmed in their posts, therefore, the question of making them permanent employees does not arise for consideration by the Additional Labour Court.
6. The first respondent-management, at para 6 of the counter statement, the specific stand has been taken that, the services of the petitioners-workmen was not terminated for any misconduct. There was no need for the management to give an opportunity for the probationers before they were not confirmed. It is also further contended at para 7 of the counter statement that Section 25-F of the Act is not attracted, however,
(it has been specifically stated it was successful completion of probationary period). The allegations of arbitrary and mala fide action of the management as alleged by the petitioners are denied. It is also further contended that, Clause 4(2) of the Standing Orders of the company specifies that, merely satisfactory completion of probationary period does not automatically entitle them permanent employment but vacancies must exist and job must be available in the company and their services must be confirmed by issuing confirmation letters in writing, after expiry of the probationary period mentioned or extended probationary period in the appointment letters.
7. On the basis of the said pleadings, the Additional Labour Court framed the issues which are extracted at para 5 of the impugned award with reference to each one of the disputes of the workmen. In support of the case of the respective parties, the evidence was adduced on behalf of the petitioner and the witnesses were examined i.e., W. 1 to W. 6 and on behalf of management also the witnesses were examined M.W. 1 to M.W. 3 and exhibits were marked Exhibits W. 1 to W. 75 and M. 1 to M. 8. The Additional Labour Court has proceeded to answer the issues framed by it at paragraph 5 of the award by assigning its reasons after considering the material evidence and the written arguments submitted by both the parties at paras 7 to 14 of the award by giving its reasons and held that, the petitioners-workmen were probationers that their services were terminated and further, the Additional Labour Court has accepted the case of the management that it could not provide the work even to the regular employees to the full capacity due to loss of main source of income thereby the probationary petitioners were terminated from their services. These findings are recorded on the basis of evidence of M.W. 1 and on the basis of the documents Ex. M. 1 and M. 2, dated 30-4-1991 and 24-2-1991 and also placing reliance on the evidence of M.W. 2.
8. The Additional Labour Court with regard to the financial position of the company, evidence was lead and the same was considered by the Additional Labour Court wherein the learned Presiding Officer has recorded his findings to the effect that, the contract between the company and the USSR could not be implemented on account of failure of contract. The goods were retained and sold in the market. Therefore, the 38 persons who were undergoing training and during the course of training contract was entered into and the petitioners-trainees were taken as probationer employees on account of failure of contract, the services of the petitioners were terminated. The Additional Labour Court further proceeds to hold that, the termination of workmen do not amount to retrenchment in terms of Section 2(oo) of the Act as the case of the petitioners fall within the exceptional category of clause (bb) of Section 2(oo) for the reason that the termination of the service of the petitioners is on account of non-confirmation of the employment for the reason that the contract between the company and the USSR failed. Therefore, placing reliance on the judgment of this Court, it has stated that termination of the services of the petitioners was justified, the Additional Labour Court has come to the conclusion that the petitioners were continued as probationary employees on the basis of the evidence and the legal contentions urged by the learned Counsel appearing on behalf of the parties interpreting the Clause 4(2) of the Standing Orders placing reliance on the judgment of this Court. While considering the said evidence and interpreting the Clause 4(1) and 4(2) of the Standing Orders and also placing reliance on the Condition No. 2 in the appointment orders issued to the petitioners with regard to the power of the management to extend the probationary period. Accepting the case laws cited on behalf of the learned Counsel for the management, the Additional Labour Court has recorded a finding that the petitioners were continued as probationers therefore, the Presiding Officer has proceeded further and assigned his reasons considering the material evidence on record and held that the case of the petitioners fall within the exceptional category of clause (bb) of Section 2(oo) of the Act and the termination of the services of the petitioners would not amount to retrenchment and therefore, the question of complying with Section 25-F, clauses (a) and (b) do not arise at all therefore, the Additional Labour Court holds that the termination of the services of the workmen was perfectly justified in law and consequently the references were rejected holding that the petitioners are not entitled for any relief. The learned Counsel Smt. Shubha Ananth submits that the findings recorded by the Additional Labour Court is based on the legal evidence and law on the questions raised and answered, therefore she submits that the award is legal and valid, which does not call for interference by this Court in exercise of this Court’s discretionary and supervisory power.
9. This Court after hearing the learned Counsel Mr. A.J. Srinivasan appearing for the petitioners and Smt. Shubha Ananth at length, proceeds to consider the matter to find out as to whether the petitioners have made out a case to show that the common award passed by the Labour Court either suffers from error in law or the findings recorded on the various contentious issues that were framed and answered the same on the basis of the pleadings and evidence are erroneous in law.
10. To answer these questions, I have perused the pleadings before the Additional Labour Court, evidence adduced before it, and the documents produced along with the writ petition and the counter statements and also the certified standing orders of the Company at Annexure-P and considered the legal contentions urged by both the learned Counsels for the parties. Further, this Court has examined the award and considered the contentions urged by the learned Counsel for the parties and records its reasons with regard to the findings recorded by the Additional Labour Court in the impugned award.
11. It is not in dispute that the petitioners were recruited and appointed against permanent posts pursuant to an advertisement made in the Deccan Herald Newspaper dated 2nd April, 1990 at Annexure-B. It is also not in dispute that the appointment orders were issued to them wherein it is stated that the petitioners were selected and appointed as “Machine Operators” in the company as per the terms and conditions enumerated in the appointment order. The relevant Clauses 2, 3 and 4
in the appointment order pertaining to the probationary period are extracted as hereunder.
“2. You will be on probation for a period of six months, which may be extended if considered necessary.
3. During the period of probation, your services are liable to termination without notice.
4. After probationary period your services are liable to termination with one month’s notice in writing on either side.
12. The stand taken by the management and the submission made on its behalf by the learned Counsel Smt. Shubha Ananth is that the management had the power of extending the probationary period of the petitioners as there is an implied power in-built in the standing order, Clause 4(2) of the company, therefore, the incorporation of the Condition Clause No. 2 in the appointment orders issued to the petitioners retaining the power of the management to extend the probationary period after expiry of six months specified in the appointment order is legal and valid in law. Further, the learned Counsel submits, in the absence of a clause in the standing orders, prohibiting an employer to extend the probationary period originally fixed enumerating the clause regarding extension of probationary period of the petitioners after the original period of probation is expired cannot be found fault with. Thereby the said clause cannot be termed as illegal. In the background of this submission, this Court has examined the Standing Orders of the company with reference to the Clause 4(1) and 4(2), which are extracted hereunder to appreciate the said contention of the learned Counsel for the petitioners and the management.
“(4) Classification of Workmen:
Workmen shall be classified as:
Permanent
Temporary
Probationer
Casual
Apprentice or Trainee
(1) A ‘Permanent’ workman is a workman who is engaged on a permanent basis and includes any person who has satisfactorily completed a probationary period of six months in the same or other occupation in the Industrial Establishment including breaks due to sickness, accident, leave, lockout, strike (not being illegal strike) or involuntary closure of the establishment.
(2) ‘Probationer’ – A probationer is one who is provisionally employed to fill a permanent vacancy in a post and has not completed the probationary period and also a permanent workman appointed as a probationer in a new post. A probationer shall be closely watched in regard to his conduct, ability and adaptability to the job assigned to him and if he does not come up to the requirements, his services will be terminated without notice during or at
the end of the probationary period. In the case of a permanent workman, he will be reverted to his original post”.
13. By reading these clauses of the certified standing orders of the company and on the basis of the admitted facts in the counter statement it is noticed that, these persons were appointed as probationers vide their appointment orders at Annexure-C. By reading sub-clause (2) of Clause 4 of the Standing Orders, the appointment of the petitioners as probationers who were employed provisionally therefore, the learned Counsel submits that, contract between the management and the erstwhile USSR failed, even after six months of the provisional appointment of the petitioners could not be either continued or probationary period could not be confirmed therefore, the petitioners did not acquire any right of employment in the company, as there was no work for them in the management, therefore, the action of termination falls within the exceptional category of clause (bb) of Section 2(oo) of the Act is not tenable in law as the same is opposed to the standing order clauses referred to above and the law laid down in this regard. By a plain reading of the aforesaid clauses of the Standing Orders of the company they would make it clear that the management has got power to prescribe the probationary period as prescribed in the sub-clause (2) of Clause 4(1). After expiry of the original probationary period, the services of the petitioners were continued in the company and further it is not the case of the management that the services of the petitioners were not continued as their services were not satisfactory to the management during the probationary period. The above said clause does not contemplate that the services of the petitioners were required to be confirmed by issuing the letters of confirmation in writing, after expiry of the original probationary period fixed in the appointment letters. The grounds on which their action was sought to be justified contending that contract between the USSR and the company suffered a set back and further the company is without following the mandatory provisions contemplated under Section 25N of Chapter V-B and Section 25-F, clause (b) and termination of the services of the petitioners as contended by it is not tenable in law and further the reasons on which they sought to justify their action on material evidence, on record is also not proved before the Additional Labour Court.
14. Learned Counsel for the management further submits, that the Clause 4(1) of the certified standing orders of the company should be read separately insofar as probationary employees are concerned. This submission is not tenable. Clause 4 deals with classification of the workmen in the company. Clause 4(1) deals with permanent workmen and Clause 4(2) defines probationary workers. If the argument of the learned Counsel for the management sought to be interpreted is accepted, then in the sub-clause (2) of Clause 4, there is no probationary period prescribed in the said clause, the period of probation is prescribed in the sub-clause (1) of Clause 4 of the Standing Orders while defining the probationer employee under sub-clause (2) of Clause 4 which is referred to a termination of the probationary workmen. Therefore, sub-clause (1) must be read along with sub-clause (2) of Clause 4 of the certified standing orders to find out who is a permanent workman and who is a probationer workman. What is stated in the definition of permanent workman is that “any person who has satisfactorily completed the probationary period of six months including breaks mentioned in the said clause”. Whereas a probationer workman is defined as “any person who has not completed the probationary period and also the permanent workman appointed as a probationer in a new post”. Further, the said clause states that a probationer workman shall be closely watched in regard to his conduct, adaptability and other aspects which are mentioned therein. By closely reading these two clauses together and the terms and conditions incorporated in the appointment orders, the contention urged by the learned Counsel for the management that the petitioners were employed provisionally against permanent posts and therefore they did not acquire any right of employment in the company cannot be accepted as the same is contrary to the clauses of the Standing Orders and the law laid down in this regard. It is not in dispute that the petitioners were appointed against permanent posts, because it has been specifically stated in the counter statement that the posts for which the petitioners were appointed as probationers after their training period was over were no longer available for their confirmation and therefore, the company had to discontinue the confirmation of probationers since there being no future prospects and therefore the petitioners have left the services on their own accord having regard to the difficulties of the management.
15. The above said important aspect of the matter has not been properly considered by the Additional Labour Court and further, the learned Presiding Officer has interpreted Clause 4(1) and 4(2) of the Standing Orders contrary to the admitted facts and the evidence on record and the law laid down by the Apex Court in this regard. He assigns the reasons at paras 8 to 10 of the award placing reliance on the judgments cited by the learned Counsel of the management without examining as to whether those authorities have got application to the facts of this case or not holding that the petitioners were on probation for six months and thereafter, the probationary period was allowed to continue, even in the absence of power to extend the probationary period and orders of extension of probation for any period. Further, the Presiding Officer has wrongly applied the judgments cited by the management’s Counsel, even though the rules which were interpreted in those judgments are entirely different from the clauses of the Standing Orders of the company referred to above and he has failed to consider the authorities cited on behalf of the workmen. Therefore, the findings recorded by him on the issue referred to above suffers from serious error in law, which shall not be allowed to sustain. In respect of these petitioners no confirmation letters were issued by the management. Therefore, they continued in service. In this regard, by reading and interpreting the Clause 4(1) and (2) of the Standing Orders, this Court has to record a finding as to whether, in the absence of a clause in the standing orders Clause 4(1) and (2), the confirmation of services is required to be given in writing by the management after satisfactory completion of six
months of probationary period, the services of the petitioners were deemed to be confirmed in their posts.
16. As per the standing orders, if the probationary period of six months is not satisfactorily completed, the management can exercise its power under sub-clause (2) and terminate the service of such probationer on expiry of the probationary period. Clause 4(1) and (2) contemplate that a probationer is a workman who is provisionally employed against a permanent vacancy as a probationer. By reading the said clause, there is no express power conferred upon the management to extend the probationary period, after expiry of the probationary period. Therefore, incorporation of the condition in the appointment order stating that, the probationary period is six months which shall be extended if considered necessary, the underlined portion of the condition in the appointment order is without authority of law. This condition is not only contrary to the standing orders of the company and the law laid down by the Apex Court. It is not the case of the management that the probationary period was extended because these petitioners’ services during the probationary period was not satisfactory. The case of the management is that, on account of failure of contract between the management and the USSR, the petitioners’ services could not be confirmed. This important material fact has not been taken into consideration by the second respondent-Labour Court at the time of interpreting the standing orders clause referred to above and the appointment orders and recorded a finding while answering the issue holding that these petitioners were continued on probation is contrary to the law laid down by the Apex Court in State of Punjab v Dharam Singh, Om Prakash Maurya v Uttar Pradesh Co-operative Sugar Factories Federation, Lucknow and Others, M.K. Agarwal v Gurgaon Gramin Bank and Others, upon which the reliance is placed by the learned Counsel, Mr. Srinivasan appearing on behalf of the petitioners. The Additional Labour Court has failed to consider the aforesaid authorities and he has also not recorded his reasons in not accepting the authorities cited supra, hence this Court in exercise of its power has to hold that the findings recorded by the Court are not only erroneous in law but also suffers from error in law, hence the said findings are liable to be quashed.
17. The learned Counsel for the petitioners, Mr. Srinivasan placed reliance on the judgment of the Apex Court in Western India Match Company Limited v Workmen, has laid down the law for the proposition that, an employer cannot enter into an agreement with the workmen which is inconsistent with the Standing Orders clauses of the company in such circumstances the clauses of the Standing Orders must prevail over the terms in the appointment orders and further when the standing orders are in force, it is not permissible for the employer to seek their
statutory modifications so that there can be one set of standing orders in respect of certain employees and another for the rest of the workmen. In other words, the employer cannot enforce simultaneously the standing orders regulating the classification of workmen and special agreements with an individual workman settling his categorisation. The learned Counsel for the petitioners-workmen would further submit that with all fours the said judgment has got application to the facts of the workmen involved in these petitions and therefore he contends that incorporation of the terms and conditions at Serial No. 2 in the appointment order regarding the probationary period of 6 months, which can be extended, if considered necessary, the underlined portion of the terms and conditions in the appointment order is contrary to the certified standing orders of the company as there is no express power conferred on the company to extend the probationary period of the petitioners after completion of probationary period of 6 months specified in Clause 4(1) of the Standing Orders. The company has no power to incorporate the terms and conditions referred to above extending the probationary period after expiry of probationary period of six months. By reading Clause 4(1) and (2) of the Standing Orders, they would make it very clear that an employee of the company can be placed on probationary period of six months; there is no power conferred upon the employer after expiry of six months to extend the probationary period and continue them as such. But it has no power to extend the probationary period of the petitioners as has been contended by the learned Counsel appearing on behalf of the first respondent-company placing reliance on the judgments of the Apex Court in the cases of S. Sukhbans Singh v State of Punjab, Governing Council of Kidwai Memorial Institute of Oncology, Bangalore v Dr. Pandurang Godwalkar and Another, Edwin A. Daniel and Another v Labour Court, Coimbatore and Another, K.A. Barat v State of Gujarat and Others, Samsher Singh v State of Punjab and Another and various other judgments cited and relied upon have not been referred in this judgment for the reason that the law laid down in the above said cases are based on the relevant service rules. The law laid down in the said cases has no application to the facts of the present case for the reasons assigned by this Court, The said contention of the company has been accepted by the second respondent-Labour Court, relying on the various authorities referred at paragraphs 10 and 17 of the impugned award and he has recorded the finding considering the judgments of the Supreme Court upon which reliance is placed by the learned Counsel for the management and he has interpreted the Clause 4(1) and 4(2) of the Standing Orders to the following effect at paragraph 10 of the award:
“If it is not extended, it does not mean the workers automatically become deemed permanent workmen. Actually, there is no prohibition either in appointment letters or in standing orders for extension of probationary period. If the period is not extended, it is deemed that they are continued to be on probation alone”.
The said finding is based on the reliance placed on the judgments referred to at paragraph 10 of the impugned award upon which reliance is placed by the learned Counsel appearing on behalf of the company. The said findings of the learned Presiding Officer of the second respondent in holding that the petitioners were continued as probationers is contrary to law laid down by the Apex Court in the case of Brooke Bond India Private Limited v Y.K. Gautam and the case referred to above, namely Wimco case and further it is also a well established principle of law that the clauses of the standing orders must be strictly interpreted and given effect to. The approach of the second respondent-Labour Court in recording the findings referred to above on the premises that there is no prohibition either in the appointment letters or in the standing orders for extension of probationary period of the petitioners is contrary to law laid down by the Apex Court. Therefore, the findings are erroneous in law. The various other judgments cited and relied upon by the learned Counsel have not been referred in this judgment for the reason that the law laid down in the above said cases are based on the relevant service rules. The law laid down in the said cases have no application to the facts of this case for the reasons assigned by this Court.
18. Having recorded the finding on the question raised by the Additional Labour Court that the petitioners have continued to be the probationary workmen, therefore the Labour Court proceeds to record a finding at paragraph 14 of the award while answering the issue framed in each one of the disputes pending before it with regard to the justification of the termination orders passed against the petitioners. The Additional Labour Court has placed reliance on the evidence of M.W. 3 and it has held that the action of the management does not amount to retrenchment as their action would fall within the exceptional category of clause (bb) of Section 2(oo) of the Act, stating that in the appointment letters issued to the petitioners it is enumerated one of the conditions to the effect that their services can be terminated without any notice during or at the end of probationary period of six months. This finding is again contrary to the definition of Section 2(oo) of clause (bb) read with Sections 25-F and 25-N of the Act and the law laid down by the Andhra Pradesh High Court in the case of D. Chennaiah v Divisional Manager, Andhra Pradesh State Road Transport Corporation, and the Division Bench of the Allahabad High Court in the case of Shylendranath Shukla and Others v Vice-Chancellor, University of Allahabad, in the said cases the Courts have interpreted Section 2(oo), clause (bb) of the Act and have clearly laid down the law under what circumstances and to which class of workmen would fall within exceptional category of Section 2(oo)
clause (bb) of the Act. The aforesaid judgments with all fours applicable to the facts of this case. The findings recorded by the Additional Labour Court is also contrary to the standing orders, Clause 4(1) and (2) of the management. Section 2(oo), clause (bb) is applicable to the cases where workmen were employed on contract basis and non-renewal of such contract of employment between the employer and the workmen and the services of the workmen concerned on expiry of the contract of employment is being terminated under the stipulation in that behalf contained therein, then such case would fall within the exception category of Section 2(oo), clause (bb) of the Act. The clause (bb) of Section 2(oo) of the Act has no application to the facts of this case for the reason that it is an undisputed fact that as per the advertisement made and published in the daily newspaper at Annexure-B by the company as it had invited applications from the eligible persons to fill up the permanent posts and after considering the applications filed by the petitioners, they were selected to the posts and the appointment orders were issued to them vide Annexure-C to all of them. Therefore, they were all appointed against the permanent vacant posts by the management. Therefore, the finding recorded by the Additional Labour Court that the termination of the services of the workmen do not come within the purview of retrenchment of Section 2(oo) of the Act as it has accepted the case of the company put forward before the Additional Labour Court. Therefore, the findings recorded by the Additional Labour Court in this regard are erroneous in law. Further, the Apex Court in the case of Uptron India Limited v Shammi Bhan and Another, has interpreted the Clause 17(g) of the Standing Orders of the said company, wherein it is held in that judgment that the services of a permanent employee cannot be terminated by giving him 3 months’ notice or pay in lieu thereof, or even without notice, notwithstanding any stipulation in the Certified Standing Orders and any clauses in the standing orders providing for automatic termination of service of a permanent employee is held to be bad and further the Apex Court at paragraphs 31 and 32 of the judgment cited supra, has explained the clauses (bb) to Section 2(oo) of the Act with regard to the usage of words “(such contract)” in the earlier part of the said clause stating as hereunder.
“What the clause, therefore, means is that there should have been a contract of employment for a fixed term between the employer and the workman containing a stipulation that the services could be terminated even before the expiry of the period of contract. If such contract, on the expiry of its original period, is not renewed and the services are terminated as a consequence of that period, it would not amount to “Retrenchment”. Similarly, if the services are terminated even before the expiry of the period of contract but in pursuance of a stipulation contained in that contract that services could be so terminated, then in that case also, the termination would not amount to “Retrenchment”. This view finds support
from a decision of this Court in Escorts Limited v Presiding Officer”.
In view of the law laid down by the Apex Court and particularly the appointment orders issued by the company incorporating probationary period of six months as stipulated in the Clause 4(1) of the Standing Orders of the management at no stretch of imagination it can be contended by the company that the appointment of the petitioners was for a stipulated period therefore the termination of those employees would fall within the exceptional category of clause (bb) of Section 2(oo) of the Act, the finding recorded by the Additional Labour Court, which suffers from error in law. Hence, the finding of the Additional Labour Court that the termination orders passed against the petitioners were just, legal and valid. Further, the Labour Court was required to examine the cases of the workmen as well as the management on the basis of the pleadings, evidence on record and law laid down in this regard. The second respondent-Labour Court at paragraphs 12 and 13 of the impugned award without considering the material evidence on record and the admitted facts, it has not considered the plea of the workmen as to whether the mandatory provisions under Section 25-F, clause (b) and the mandatory provision under Section 25-N of the Chapter V-B of the Act are complied with or not. These relevant aspects of the case have not been considered and answered by the Additional Labour Court. In this regard, the contention urged by the first respondent-management in the counter statement is relevant to consider in these petitions, at page 2 it is stated as hereunder.
“The posts for which the probationers were engaged were no longer available for confirmation and therefore the company had to discontinue the confirmation of the probationers, since there was no future prospects in the company and some probationers left on their own accord and some were requested to leave having regard to the difficulties of the management and the petitioners-workmen were such probationers”.
This statement of facts were required to be testified by the second respondent with reference to the letters written by the workmen at Annexures-D and E which were produced before the Additional Labour Court and marked them as workmen exhibits in their evidence, wherein the workmen have written to the Personnel Manager of the company on 12-5-1992 and 20-6-1992 respectively, stating that their services have been terminated from 11-5-1992, being aggrieved of the same they have raised an industrial dispute before the Additional Labour Court. Therefore, it is stated that they have lost their services and they are unemployed; on account of their unemployment they have no livelihood and requested the company to pay all the dues, Provident Fund, Production Bonus, Annual Bonus, leave wages, unpaid wages, etc., undisputedly these letters have not been considered by the company. In addition to this there is an evidence of M.W. 2 placed on record before the second
respondent-Additional Labour Court at para 10 of the statement of evidence the said witness has stated that Srinivas, Vasudevan, Suresh, Nagendra have completed their training prior to 1990 and joined the company. The letters of appointment were given to the petitioners and others in the year 1990 by the company. He has further stated that they were company trainees, training was for a period of 2 years. It is also further admitted in his evidence that 38 workers were appointed in the year 1990 as trainee operators for a period of 2 years. The seniority list of 38 workers was not maintained by the management. No retrenchment compensation amount has been paid to the workers. This Court for the reasons stated supra in the preceding paragraphs has already held that the findings of the second respondent-Labour Court on the issue framed by it in each one of the disputes with regard to the justification of the termination of the services of the petitioners are bad in law and further held that the termination of the services of the workmen would not fall within the exceptional category of clause (bb) of Section 2(oo) of the Act, in view of the law laid down by the Apex Court and other High Courts in the country referred to above. Therefore, reliance placed on the judgment of this Court by the learned Counsel, Smt. Shubha Ananth in the case of C.M. Jitendra Kumar v Bharat Earth Movers Limited, has no application to the facts of this case for the reasons stated above, hence the said judgment is misplaced and the same cannot be accepted. It is an undisputed fact that the petitioners were appointed against the permanent posts as machine operators by the management as per the appointment letters similar to Annexure-C. It is the case of the management that it had a set back on account of the disintegration of the USSR in the year 1991 and the evidence is adduced in this regard by examining M.W. 2 and further he has stated in his evidence that in view of the disintegration of USSR, the future of the company and its exports which was the main source of income was lost by the company, therefore the posts for which the petitioners were engaged were no longer available for their confirmation in the posts. Therefore, the company had to discontinue the petitioners who were alleged to be probationers. Some of the probationers left on their own and some were requested to leave having regard to the difficulties of the management. By reading the pleadings of the management, two things would emerge namely,
(a) Some of the probationers were not available to confirm themselves in the posts in which they were appointed.
(b) The petitioners have voluntarily abandoned from their services.
The voluntary abandonment of the job is a question of fact which has to be gathered from the various attendant facts and circumstances that are placed before the Additional Labour Court. The plea regarding voluntary abandonment of services by the workmen as urged in their counter statement by the management is not considered by the second respondent-Labour Court and answered that contentious issue. The Hon’ble
Supreme Court of India in the case of G.T. Lad and Others v Chemicals and Fibres India Limited, has laid down the law that the voluntary abandonment is a question of intention of the workmen to be gathered from the evidence on record, as to whether the petitioners have tethered their relationship with the management by abandoning themselves from the services as contended by the management. I have gone through the evidence of M.W. 1 and M.W. 2 to answer this contention. By reading their evidence very closely, there is no evidence on record to prove the contention of the management that the petitioners have abandoned their jobs as alleged in the counter statement. On the other hand in the cross-examination of M.W. 2 at paragraph 26 of his statement of evidence he has categorically admitted that in the month of May or June 1992 the services of the workmen were stopped.-
“Myself and my Personnel Manager, Mr. K. Chandrashekar orally informed the workers about the stoppage of the works to them”.
From the evidence of the management witnesses and by reading Annexures-C and D and the evidence placed on record on behalf of the workmen it is very clear that the company has refused employment to the workmen in contravention of the provisions of the Chapter V-A and V-B of the Act, referred to above and the law laid down by the Apex Court and this Court. The termination orders passed against the petitioners are otherwise for misconduct. Therefore, the termination orders in refusing employment to the workmen amount to retrenchment as defined under Section 2(oo) of the Act. Further, the management has not stated in the counter statement and produced the documentary evidence to show that the posts against which the petitioners and others who were employed were not available for the reasons stated in the counter statement that it had lost the export business on account of the USSR disintegration and that they were abolished. The company should have specifically stated before the second respondent-Additional Labour Court that such posts were abolished. Therefore, the next question that falls for consideration of this Court is whether the management has complied with the mandatory provisions of Section 25-F, clause (b) of Chapter V-A and Section 25-N of Chapter V-B of the Act, in view of the fact that the company is a factory as defined under Section 2(m) of the Factories Act, 1948, therefore Chapter V-B of the Act was attracted in the instant case with regard to the retrenchment of the workmen. Admittedly, the management has not filed an application before the Karnataka State Government seeking permission to retrench 30 workmen including the petitioners. The non-compliance with the mandatory statutory provisions of Section 25-K and 25N of the Chapter V-B of Act has rendered the orders of termination void ab initio in law. Further, it is an admitted fact that either three months’ notice or three months’ notice pay in lieu of notice has been given to the workmen and further prior permission has not been obtained from the Government prior to refusal of employment to the workmen. Therefore, the action of the management in not complying with mandatory provisions of Section 25-N in terminating the services of the workmen is bad in law. Therefore, the termination orders passed by the management is a nullity in the eye of law. This important aspect of the matter has not been taken into consideration by the second respondent-Additional Labour Court, as he has proceeded to answer the issues and hold that the action of the management would not amount to retrenchment as it falls within the exceptional category of clause (bb) of Section 2(oo) of the Act. As I have already answered the said finding of the Additional Labour Court and held that the said finding is erroneous for the reasons recorded by me in this order holding that action of management in terminating the services of the workmen is not justified for more than one reasons assigned by me in preceding paragraphs of this order. Therefore, the Additional Labour Court’s findings in the award and rejecting the claim petitions of the petitioners is an error apparent on the face of record for more than one reasons assigned by me in the preceding paragraphs of this order. Therefore, the petitioners must succeed in these petitions.
19. This Court dictated the judgment in part on 26-3-1999. For want of time, the further dictation of the judgment could not be continued and completed till this date. Smt. Shubha Ananth further submits that the company is willing to offer Rs. 50,000/- to each one of the petitioners as compensation in lieu of their all claims by way of full and final settlement to show the bona fides of the management that their action is not mala fide. Therefore, she has requested this Court to take this offer of the management into consideration and mould the relief while granting the appropriate relief to the petitioners. For this proposal of the management, the learned Counsel on behalf of the petitioners Sri Srinivasan would submit that the offer made by the company is not acceptable for the reason that they are not interested in the monetory compensation that is offered to them as they are all in the age group between 30 to 33 years as on today. Hence, the learned Counsel submits that workmen require employment; therefore, he would submits that the offer given by the management is not acceptable to them.
20. This Court having answered the points of dispute between the parties holding that the termination orders passed against the workmen are not justified for the reasons recorded by me in this order.
21. The next question for consideration of this Court is for the reasons recorded by this Court in the aforesaid paragraphs this Court has to answer to what reliefs the workmen are entitled to. This aspect is considered by this Court having due regard to the facts of this case and the termination orders are held to be nullity in the eye of law and the same are liable to be set aside and further the workmen are in the age group between 30 to 33 years as on today and further the management has not placed any material evidence either before the Additional Labour Court or before this Court to show that the workmen are gainfully employed and the management is not liable to pay full back wages to the workmen. Therefore, for the reasons stated by me in this judgment, the offer of compensation of Rs. 50,000/- by the management to each one of
the petitioners is not sufficient and adequate monetary benefits. Hence, I pass the following order.-
The writ petitions are allowed. Issue rule and made absolute. The impugned common award passed by the second respondent-Additional Labour Court at Annexure-A is hereby quashed. The termination orders passed against the petitioners are set aside. The first respondent-management is directed to reinstate all the petitioners/workmen within two months from the date of receipt of this order and pay full salary from the date of termination order till their reinstatement with all consequential benefits including continuity of service.
While parting with this judgment, it is necessary to observe that this Court, after hearing the learned Counsel for the parties, by its order dated 9-3-1999, had directed the learned Additional Government-Advocate to secure the records from the second respondent-Additional Labour Court. The learned Additional Government-Advocate submits that he has made his best efforts to secure the record and he had personally spoken to the Presiding Officer of the second respondent-Additional Labour Court in this regard. He has not co-operated with him in sending the records to enable him to produce the same before this Court. Therefore, the submission of the learned Additional Government-Advocate is placed on record and further this Court observes that the Presiding Officer of the second respondent-Additional Labour Court has not co-operated with the learned Additional Government-Advocate in sending the record, as directed by this Court which attitude of the Presiding Officer has to be viewed seriously. Therefore, the Registrar General of this Court is directed to take necessary action against the concerned Presiding Officer on the administrative side in accordance with law.
Sri Mehaboob Ali Khan, the learned Additional Government-Advocate, is permitted to file memo of appearance within four weeks.