{"id":257341,"date":"1990-07-27T00:00:00","date_gmt":"1990-07-26T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/j-k-cotton-spg-and-wvg-mills-co-vs-state-of-u-p-and-ors-on-27-july-1990"},"modified":"2016-06-11T23:09:13","modified_gmt":"2016-06-11T17:39:13","slug":"j-k-cotton-spg-and-wvg-mills-co-vs-state-of-u-p-and-ors-on-27-july-1990","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/j-k-cotton-spg-and-wvg-mills-co-vs-state-of-u-p-and-ors-on-27-july-1990","title":{"rendered":"J.K. Cotton Spg. And Wvg Mills Co. … vs State Of U.P. And Ors on 27 July, 1990"},"content":{"rendered":"
Supreme Court of India<\/div>\n
J.K. Cotton Spg. And Wvg Mills Co. … vs State Of U.P. And Ors on 27 July, 1990<\/div>\n
Equivalent citations: 1990 AIR 1808, 1990 SCR (3) 523<\/div>\n
Author: Ahmadi<\/div>\n
Bench: Ahmadi, A.M. (J)<\/div>\n
           PETITIONER:\nJ.K. COTTON SPG. AND WVG MILLS CO. LTD.,KALPI ROAD, KANPUR\n\n\tVs.\n\nRESPONDENT:\nSTATE OF U.P. AND ORS.\n\nDATE OF JUDGMENT27\/07\/1990\n\nBENCH:\nAHMADI, A.M. (J)\nBENCH:\nAHMADI, A.M. (J)\nRANGNATHAN, S.\n\nCITATION:\n 1990 AIR 1808\t\t  1990 SCR  (3) 523\n 1990 SCC  (4)\t27\t  JT 1990 (3)\t300\n 1990 SCALE  (2)153\n\n\nACT:\n    U.P.  Industrial Disputes Act,  1947--Section  2(s)\t and\n6N-Resignation voluntarily tendered by an employee--Employer\naccepting the same--Services of employee  terminated-Whether\namounts to 'retrenchment'.\n\n\n\nHEADNOTE:\n    One Ram Singh was appointed by the appellant-company  on\n10.3.1960.  On 1.11.1970, he addressed a letter of  resigna-\ntion to the Manager of the company saying that owing to\t his\nfamily\tcircumstances, it was no longer possible for him  to\ncontinue  in service and that he was compelled to sever\t his\nconnections  with the company. He made a demand of  all\t his\ndues.  He wrote another letter two days later  that  someone\nshould\tbe  posted in the section where he  was\t working  in\norder  that he may learn the work are: printing\t of  shares,\npay-sheets  and\t pay registers\tetc.  The  appellant-company\nconveyed the acceptance of the resignation with effect\tfrom\nthe 16th November, 1970 and paid all his dues on 22.12.1970.\nThe amount of gratuity was also paid later. Ram Singh there-\nafter  raised an industrial dispute and sought\ta  reference\nunder  Section 4K of the U.P. Industrial Dispute Act,  1947.\nInitially  his demand was not accepted by the State  Govern-\nment  but later the State Government accepted his demand  on\n28.11.1974  whereupon  the appellant-company  filed  a\twrit\npetition  in the High Court challenging the  said  reference\nmade  by the State Government but the High  Court  dismissed\nthe  petition. The Labour Court thereafter made an award  on\nthe  reference,\t in favour of the employee. It came  to\t the\nconclusion that the employee's resignation was not voluntary\nand  therefore his services had been wrongly terminated\t and\naccordingly he was directed to be reinstated. The  appellant\nchallenged the validity of the said award under Article\t 226<\/a>\nof  the Constitution before the High Court. The\t High  Court\ncame  to the conclusion that the employee had  tendered\t his\nresignation voluntarily but it held that termination of\t the\nservice\t of the employee fell within the definition  of\t 'r-\netrenchment' as contained in Section 2(s) and as the  appel-\nlant-company  had failed to comply with the  requirement  of\nSection 6N, the termination of service was invalid. The High\nCourt  accordingly  set\t aside the  order  of  reinstatement\npassed by\n524\nthe Labour Court and remanded the matter to the Labour Court\nfor a decision on the question whether there was  infraction\nof  the\t provisions of Section 6N. Being aggrieved  by\tthat\norder  of  the High Court, the appellant-company  has  filed\nthis appeal after obtaining special leave.\nAllowing the appeal, this Court,\n    HELD:  Where a contract of service is determined on\t the\nemployee  exercising  his right to  quit,  such\t termination\ncannot be said to be at the instance of the employer to fail\nwithin\tthe first part of the definition of retrenchment  in\nSection\t 2(s)  of the U.P. Industrial Disputes\tAct.  [531H;\n532A]\n    A contract of service can be determined by either  party\nto  the contract. If it is determined at the behest  of\t the\nemployer  it may amount to retrenchment unless it is by\t way\nof  punishment\tfor proved misconduct. But  if\tan  employee\ntakes  the initiative and exercises his right to put an\t end\nto  the contract of service and the employer merely  assents\nto  it, it cannot be said that the employer  has  terminated\nthe employment. In such cases the employer is merely  acced-\ning to the employee's request, may be even reluctantly. Here\nthe  employee's role is active while the employer's role  is\npassive\t and formal. The employer cannot force an  unwilling\nemployee to work for him. [531E-F]\n    When an employee resigns his office, he formally  relin-\nquishes or withdraws from his office. it implies that he has\ntaken  a mental decision to sever his relationship with\t his\nemployer and thereby put an end to the contract of  service.\n[533E]\n    In the present case the employee's request contained  in\nthe  letter of resignation was accepted by the employer\t and\nthat brought an end to the contract of service. [534B]\n    This  was  a case of 'voluntary retirement'\t within\t the\nmeaning of the first exception to section 2(s) and therefore\nthe  question of grant of compensation under section 6N\t did\nnot arise. The employee is not entitled to any\tcompensation\nunder section 6N<\/a> of the State Act. [534F]\n    The State Bank of India v.N. Sundara Money<\/a>, [1976] 1 SCC\n822;  Hindustan Steel Ltd. v. The Presiding Officer,  Labour<\/a>\ncourt,\tOrissa and Ors., [1976] 4 SCC 222; Delhi  Cloth\t and\nGeneral\t Mills\tLtd. v. Shambhu Nath  Mukherji<\/a>\tand  others,\n[1977]\t4 SCC 415; Santosh (Gupta v. State Bank of  Patiala<\/a>,\n[1980] 3 SCC 340; L. Robert D'souza v., Executive  Engineer,\nSouthern Railway and Anr., [1982] 1SCC 645 and\n525\nCorporation of Cochin v. Jalaji and Ors., [1984] 1 LLJ\n\n\n\nJUDGMENT:\n<\/pre>\n
    CIVIL  APPELLATE JURISDICTION: Civil Appeal No,  307  of
\n1987.\n<\/p>\n
    From  the  Judgment and Order dated\t 16.10.1985  of\t the
\nAllahabad High Court in C.M.W. No. 3689 of 1984.
\nG.B. Pai, Ms. Urmila Kapoor and S. Janani for the Appellant.
\n    Prithivi  Raj, Vishnu Mathut and Ms. S. Dikshit for\t the
\nRespondents.\n<\/p>\n
The Judgment of the Court was delivered by
\n    AHMADI, J. When the service of an employee is terminated
\nconsequent  upon  the  employer\t accepting  the\t resignation
\nvoluntarily  tendered by the employee, does the\t termination
\nso brought about amount to ‘Retrenchment’ within the meaning
\nof  Section 2(s)<\/a> read with Section 6N of the  Uttar  Pradesh
\nIndustrial Disputes Act, 1947, is the question which we\t are
\ncalled\tupon to decide in this appeal by special leave.\t The
\nfacts relevant to be stated for the disposal of this  appeal
\nare as under:\n<\/p>\n
    Ram Singh was employed by the appellant-company on\t10th
\nMarch, 1960 and was posted in the Bradma machine section  of
\nthe  company. His duties were to attend to the\tprinting  of
\nshares,\t pay sheets, registers, ESI cards etc., relating  to
\nthe appellant-company. On 1st November, 1970 he addressed  a
\nletter of resignation to the Manager of the appellant-compa-
\nny in the following words:\n<\/p>\n
“R\/Sir,
\nI regret to bring to your kind notice that my family circum-
\nstances do not permit me to continue my service and hence  I
\nam compelled to sever my connections with these Mills  imme-
\ndiately.\n<\/p>\n
I,  therefore, request your goodself kindly to\tarrange\t for
\nthe payment of all my dues at an early date.”
\nTwo  days thereafter he wrote another letter to the  Manager
\nof the company which reads as under:\n<\/p>\n
526<\/span><\/p>\n
“R\/Sir,
\nSince  I have already tendered my resignation from my  serv-
\nices, I request you kindly to depute somebody in the  Bradma
\nOffice\ttaking\tcharge and learning the work,  so  that\t the
\nentrusted work may be carried on smoothly.
\nThanking  you  so much for making early arrangement  as\t re-
\nquested.”\n<\/p>\n
A copy of this letter was endorsed to the Special  Executive
\nof  the\t appellant-company  for\t information  and  necessary
\naction. On receipt of the above letters, the Manager of\t the
\nappellant-company replied as under:\n<\/p>\n
“The resignation tendered by you vide your letter dated\t 1st
\ninstant, is hereby accepted with effect from 16th instant.
\nPlease hand over charge of the Company’s properties in\tyour
\npossession  to Shri R.S. Mathur and collect payment in\tfull
\nand final settlement from the Mills Pay Office.”\n<\/p>\n
    After  the\treceipt\t of this letter the  charge  of\t the
\nBradma\tSection was handed-over by the employee to the\tsaid
\nR.S.  Mathur on 15th November, 1970. The amount due  to\t the
\nemployee  by  way  of salary, allowances,  etc.,  upto\t16th
\nNovember,  1970\t was worked out but the actual\tpayment\t was
\nreceived by the employee on 22nd December, 1970. He was also
\npaid  his service gratuity at the end of February, 1971.  It
\nappears\t that the employee raised an industrial dispute\t and
\nsought\ta reference under Section 4K<\/a> of the State  Act.\t The
\nemployee’s demand for a reference was initially rejected  by
\nthe  State Government on 12th November, 1973 but it came  to
\nbe accepted subsequently on 28th November, 1974. The  appel-
\nlant-company thereupon filed a writ petition challenging the
\nsaid  reference\t made by the State Government but  the\tHigh
\nCourt dismissed the petition on 7th September, 1981.  Pursu-
\nant  to\t the reference, the Labour Court made  an  Award  in
\nfavour\tof  the employee on 25th January, 1984.\t The  Labour
\nCourt came to the conclusion that the employee’s resignation
\nwas  not  voluntary and, therefore, his\t services  had\tbeen
\nwrongly terminated with effect from 15th November, 1970.  He
\nwas  ordered  to be reinstated. Against this  Award  of\t the
\nLabour\tCourt the appellant approached the High Court  under
\nArticle 226<\/a> of the Constitution. The High Court came to\t the
\nconclusion  that the employee had tendered  his\t resignation
\nvoluntarily
\n527<\/span>
\nand  without any threat or coercion. It also took  the\tview
\nthat  the  claim for overtime wages  was  an  after-thought.
\nHowever,  considering  the definition of  ‘retrenchment’  in
\nSection 2(s)<\/a>, the High Court came to the conclusion that the
\ntermination of service of the employee fell within the\tsaid
\ndefinition  and as the appellant company had failed  to\t ob-
\nserve  the  requirements of section 6N<\/a>, the  termination  of
\nservice was clearly invalid. The approach to the High  Court
\nis reflected in the following passage of its Judgment:
\n8″The  contention  raised is that there was no\tact  of\t the
\nemployer  in this connection and hence this may not be\tsaid
\nto be a case of retrenchment of the respondent. To this I do
\nnot  find  possible to agree. There is no  denial  that\t the
\nrespondent had been in continuous service for not less\tthan
\none  year  within the meaning of Section  6N<\/a>.  According  to
\nSection 2(s)<\/a>, retrenchment covers termination by the employ-
\ner of the service of a workman for any reason whatsoever. To
\nthis  there are exceptions applicable where the\t termination
\nis by way of punishment inflicted as a result of a discipli-
\nnary_  action  or  voluntary retirement of  the\t workman  or
\nretirement of the workman on attaining the age of superannu-
\nation.\tThe provision is in pari materia with section  2(00)<\/a>
\nof  the\t Central Act. The case does not fail within  any  of
\nthese exceptions. Voluntary retirement of a workman may\t not
\nstand  in  need of acceptance by the employer; this  may  be
\nhedged in with certain conditions such as those relating  to
\ncertain\t number of years having been put in service and\t the
\nlike, but resignation may be tendered at any time though  it
\nrequires  acceptance to be effective. There is\tretrenchment
\nunder  law where the services of a workman stand  terminated
\nfor  any  reason whatsoever. This may not be  a\t consequence
\ndirectly  flowing from an act of the employer. The  material
\nfactor would be whether there is determination of the  rela-
\ntionship of employer and workman between the parties. If  as
\na  consequence\tthis  relationship has ceased  or  has\tbeen
\nbrought to an end, there is the resultant termination of the
\nservices of the workman.”\n<\/p>\n
In support of this view reliance was placed on the decisions
\nof  this  Court\t in The State Bank of India  v.\t N.  Sundara
\nMoney<\/a>, [1976] 1 SCC 822; Hindustan Steel Ltd. v. The Presid-
\ning  Officer,  Labour Court, Orissa & Others, [1976]  4\t SCC
\n222,  Delhi  Cloth and General Mills LId.  v.  Shambhu\tNath
\nMukherji and Others, [1977] 4 SCC 415; Santosh
\n528<\/span>
\nGupta  v.  State Bank of Patiala<\/a>, [1980] 3 SCC\t340  and  L.
\nRobert\tD’Souza v. Executive Engineer, Southern Railway\t and
\nAnother<\/a>,  [1982] 1 SCC 645. Reliance was also placed on\t the
\ndecision  of the Kerala High Court in Corporation of  Cochin
\nv. Jalaji & Others, [1984] 1 LLJ 526.\n<\/p>\n
Proceeding further the High Court concluded as under:
\n”   …..  the present is a case where there was act of\t the
\nemployer  also before the termination became  effective.  As
\ndiscussed above, the resignation tendered by the  respondent
\ncould not take effect without the acceptance on the part  of
\nthe  employer.\tThe acceptance was accorded on\tNovember  4,
\n1970,  expressly in writing. This clearly is an act  of\t the
\nemployer  which put a seal to the matter and  brought  about
\ncessation of the relationship of the employer and the  work-
\nman. Therefore, there is no escape from the conclusion\tthat
\nit  was\t a case of retrenchment. It remains to\tbe  seen  on
\nrelevant material whether in fact there was compliance\tmade
\nof the requirement of section 6N<\/a>.”\n<\/p>\n
However,  the  order of reinstatement passed by\t the  Labour
\nCourt,\tKanpur was set aside and the matter was remanded  to
\nthe  Labour  Court for a decision on  the  question  whether
\nthere  was  an\tinfraction of section 6N<\/a>.  The\tHigh  Court,
\nhowever, made it clear that “the issue of resignation  shall
\nnot  be open to read judication”. In other words,  the\tonly
\nquestion which the Labour Court was required to consider was
\nwhether\t the retrenchment was in conformity with section  6N<\/a>
\nof the State Act. Feeling aggrieved by this order the appel-
\nlant-company has approached this Court under Article 136<\/a>  of
\nthe Constitution.\n<\/p>\n
    The\t State Act<\/a>, i.e., Uttar Pradesh Industrial  Disputes
\nAct,  1947 was enacted to provide powers to prevent  strikes
\nand  lock-outs, to settle industrial disputes and for  other
\nincidental matters. Section 2(s)<\/a> defines the term ‘Retrench-
\nment’ as under:\n<\/p>\n
“2(s): ‘Retrenchment’ means the termination by the  employer
\nof  the\t service  of a workman for  any\t reason\t whatsoever,
\notherwise  than as punishment inflicted by way of  discipli-
\nnary action, but does not include–\n<\/p>\n
(i) voluntary retirement of the workmen; or
\n529<\/span>\n<\/p>\n
(ii) retirement of the workmen on reaching the age of super-
\nannuation if the contract of employment between the employer
\nand  workman  concerned\t contains  a  stipulation  in\tthat
\nbehalf.”\n<\/p>\n
This  definition is in pari materia with the  definition  of
\n‘retrenchment’\tfound  in section 2(00)<\/a> of the\tCentral\t Act
\ni.e. Industrial Disputes Act<\/a>, 1947 as it stood prior to\t its
\namendment by Act LIX of 1984. Section 6N<\/a>
\nthe State Act reads as under:\n<\/p>\n
“6N. Conditions precedent to retrenchment of workman.  —No
\nworkman employed in any industry who has been in  continuous
\nservice\t for not less than one year under an employer  shall
\nbe retrenched by that employer until–\n<\/p>\n
(a) the workman has been given one month’s notice in writing
\nindicating  the reasons for retrenchment and the  period  of
\nnotice has expired, or the workman has been paid in lieu  of
\nsuch notice wages for the period of the notice;
\nProvided  that\tno  such notice shall be  necessary  if\t the
\nretrenchment  is under an -agreement which specifies a\tdate
\nfor the termination of service;\n<\/p>\n
(b) the workman has been paid, at the time of  retrenchment,
\ncompensation  which  shall be equivalent  to  fifteen  days’
\naverage pay for every completed year of service or any\tpart
\nthereof in excess of six months; and\n<\/p>\n
(c)  notice in the prescribed manner is served on the  State
\nGovernment.”\n<\/p>\n
This  section  substantially reproduces section 25F<\/a>  of\t the
\nCentral\t Act.  In  the Central Act<\/a> the proviso\tcame  to  be
\nomitted\t by Act LIX of 1984 and instead clause (bb) came  to
\nbe added to section 2(00)<\/a>.\n<\/p>\n
    The first question which we must consider is whether  in
\nthe  background of facts stated earlier it can be said\tthat
\nthe  services  of  the employee were terminated\t by  way  of
\n‘retrenchment’ as understood by
\n530<\/span>
\nsection 2(s)<\/a> and, if yes, whether the employer was  required
\nto  comply  with the provisions of section 6N<\/a> of  the  State
\nAct.  It becomes clear on a plain reading of the  definition
\nof  the term ‘retrenchment’ that it comprises of two  parts;
\nthe first part is the inclusive part which defines retrench-
\nment  whereas the second part is in the nature of an  excep-
\ntion  and  excludes two types of cases from  the  scope\t and
\nambit of the said definition. Under the first part  termina-
\ntion of an employee’s service by the employer for any reason
\nwhatsoever, otherwise than by way of punishment inflicted as
\na  disciplinary measure, amounts to retrenchment. Under\t the
\nsecond part cases of (i) voluntary retirement & (ii) retire-
\nment  on  superannuation are excluded from  purview  of\t the
\nfirst part of the definition. Termination of service can  be
\nbrought\t about\tin  diverse ways by an\temployer  but  every
\ntermination is not retrenchment, as for example, termination
\nof  service by way of punishment for proved misconduct.\t The
\nwords  ‘for any reason whatsoever’ are undoubtedly words  of
\nwide import and hence termination of service by the employer
\nwill  attract  the definition of retrenchment unless  it  is
\nshown  to be penal in nature brought about by way of  disci-
\nplinary action or as falling within one of the two exclusion
\nclauses\t extracted earlier. In order to counter the  employ-
\nee’s  contention that he was retrenched from service on\t the
\nemployer having communicated the acceptance of his  resigna-
\ntion, the employer has placed reliance on the first  clause,
\nnamely, that the workman had voluntarily retired from  serv-
\nice.  The  letter dated 1st November, 1970  written  by\t the
\nemployee to the Manager of the appellant-company  expressing
\nhis  desire to resign his job shows that it was a  voluntary
\nact on the part of the employee. This was followed by anoth-
\ner letter of 3rd November, 1970 whereby the workman request-
\ned  the\t company  to depute someone to take  charge  of\t the
\nBradma\toffice so that he gets acquainted with the  work  to
\nensure\ta  smooth take over. It was on this request  of\t the
\nemployee that the appellant-company accepted his resignation
\nby  the letter of 4th November, 1970 with effect  from\t16th
\nNovember, 1970. From this correspondence it is crystal clear
\nthat  the employee desired to sever his relations  with\t the
\nappellant-company  on account of his  family  circumstances.
\nBut  for  this\trequest made by the employee  there  was  no
\nreason\tfor the appellant-company to terminate the  contract
\nof  service on its own. Just as an employer has a  right  to
\nterminate the service of an employee, an employee too has  a
\nfight to put an end to the contract of employment by inform-
\ning  his employer of his intention to give up the job.\tThis
\nfight is specifically conferred by clause 21 of the Standing
\nOrders\tcertified under Section 5 of the Industrial  Employ-
\nment  (Standing\t Orders)  Act<\/a>, 1946. This  clause  reads  as
\nunder:\n<\/p>\n
531<\/span><\/p>\n
“Any  permanent\t clerk\tdesirous of  leaving  the  company’s
\nservice\t shall\tgive one month’s notice in  writing  to\t the
\nManager\t unless he has a specific agreement providing for  a
\nlonger or shorter notice. If any permanent clerk leaves\t the
\nservice\t of the company without giving notice, he  shall  be
\nliable to be sued for damages.”\n<\/p>\n
Similar\t clause\t with reduced notice period is\talso  to  be
\nfound  in  the\tcertified Standing  Orders  for\t operatives.
\nTherefore,  one of the ways of terminating the\tcontract  of
\nemployment  is resignation. If an employee makes his  inten-
\ntion to resign his job known to the employer and the  latter
\naccepts the resignation, the contract of employment comes to
\nan  end\t and with it stands  severed  the  employer-employee
\nrelationship.  Under the common law the resignation  is\t not
\ncomplete  until it is accepted by the proper  authority\t and
\nbefore\tsuch acceptance an employee can change his mind\t and
\nwithdraw the resignation but once the resignation is accept-
\ned  the\t contract comes to an end and  the  relationship  of
\nmaster\tand servant stands snapped. Merely because  the\t em-
\nployer\tis expected to accept the employee’s resignation  it
\ncannot be said that the employer has brought about an end to
\nthe  contract of employment so as to bring the\tcase  within
\nthe first part of the definition of retrenchment. A contract
\nof  service  can be determined by either party to  the\tcon-
\ntract. If it is determined at the behest of the employer  it
\nmay amount to retrenchment unless it is by way of punishment
\nfor proved misconduct. But if an employee takes the  initia-
\ntive  and exercises his right to put an end to the  contract
\nof service and the employer merely assents to it, it  cannot
\nbe said that the employer has terminated the employment.  In
\nsuch cases the employer is merely acceding to the employee’s
\nrequest,  may be even reluctantly. Here the employee’s\trole
\nis  active while the employer’s role is passive and  formal.
\nThe employer cannot force an unwilling employee to work\t for
\nhim.  Under clause 21 of the certified Standing\t Orders\t all
\nthat the employee-is required to do is to give the  employer
\na notice to quit and on the expiry of the notice period\t his
\nservice\t would\tcome to an end. A formal acceptance  of\t the
\nemployee’s desire by the employer cannot mean that it is the
\nemployer  who is putting an end to the contract\t of  employ-
\nment.  It  would be unfair to saddle the employer  with\t the
\nliability  to  pay compensation even where  the\t service  is
\nterminated on the specific request of the employee. Such  an
\nintention  cannot be attributed to the legislature. We\tare,
\ntherefore,  of the opinion that where a contract of  service
\nis determined on the employee exercising his right to quite,
\nsuch termination cannot be said to be at the instance of the
\nemployer
\n532<\/span>
\nto fall within the first part of the definition of retrench-
\nment in section 2(s)<\/a> of the State Act.\n<\/p>\n
    The High Court has placed reliance on ,four decisions of
\nthis  Court to which we may now advert. In  Sundara  Money’s
\ncase  the employment was for a fixed duration of 9 days,  on
\nthe  expiry whereof the service was to end.  This  condition
\nwas  imposed unilaterally. The employment was  to  terminate
\nnot because the employee did not desire to serve but because
\nof  the\t unilateral condition imposed by the  employer.\t The
\ninitiative  for\t the termination, therefore, came  from\t the
\nemployer  attracting the wide terminology of section  2(00)<\/a>.
\nIn  Hindustan Steel Ltd. the termination of service  was  by
\nefflux\tof  time. Placing reliance on the law laid  down  in
\nSundara Money’s case and the proviso to section 25F(a)<\/a>, this
\nCourt  held  that the termination of service was by  way  of
\nretrenchment.  In the case of Delhi Cloth Mills the  employ-
\nee’s name was taken as automatically removed from the  rolls
\nof  the\t company  under the Standing  Orders  for  continued
\nabsence without prior intimation. The striking off the\tname
\nwas clearly an act of the employer resulting in\t termination
\nof service amounting to retrenchment. Santosh Gupta’s was  a
\ncase of termination of service on account of her failure  to
\npass the prescribed test. That was the reason for  terminat-
\ning  her service. All the same it was the employer’s  action
\nwhich resulted in the termination of her service  attracting
\nsection 2(00)<\/a>. In the case of Robert D’souza the termination
\nwas rounded on the ground of unauthorised absence from\tduty
\nwhich clearly was an act of the employer. In all the.. above
\ncases  on which the High Court placed reliance, no  question
\nof  termination of service on the employee voluntarily\tten-
\ndering his resignation arose for consideration. These  cases
\nare,  therefore,  not helpful since they turn on  their\t own
\nspecial\t facts. None of them deals with a case of  voluntary
\nresignation tendered by an employee.\n<\/p>\n
    We\tmay  now examine the question  from  another  angle,
\nnamely,\t whether  an  employee whose  resignation  has\tbeen
\naccepted  by the employer falls within the  first  exclusion
\nclause\tto the definition of the term ‘retrenchment’.  There
\ncan  be\t no  doubt that a resignation  must  be\t voluntarily
\ntendered  for  if  it is tendered on account  of  duress  or
\ncoercion,  it ceases to be a voluntary act of  the  employee
\nexpressing  a desire to quite service. In the  present\tcase
\nthe High Court has come to the conclusion that the  employee
\nhad  tendered his resignation voluntarily. Does\t termination
\nof  service brought about by the acceptance  of\t resignation
\nfall with the expression ‘voluntary retirement’? The meaning
\nof the term ‘resign’ and ‘retire’ in different\tdictionaries
\nis as under:\n<\/p>\n
533<\/span><\/p>\n
\t\t\t   TABLE\n<\/p>\n
————————————————————
\nName  of  the\tMeaning of ‘Resign’    Meaning\tof  ‘Retire’
\nDictionary\n<\/p>\n
————————————————————
\nBlack’s Law    Formal renouncement     to terminate employ-
\nDictionary     or relinquishment       ment or service upon
\n(5th Edn.)     of an office.\t       reaching retirement
\n\t\t\t\t       age.<\/p>\n
\nShorter Ox-   To relinquish,\t       The act of retiring\nford English  surrender, give up       or withdrawing to\nDictionary    or hand over (some-      or from a place or\n(Revised      thing); esp., an\t       from a place or\nEdn. of 1973) office, position,\t       position.\n\t      right, claim, etc.\n\t      To give up an office\n\t      or position; to retire.\nThe Random    To give up an office     To withdraw from of-\nHouse Dic-    , position etc.; to      fice business or\ntionary\t      relinquish (right,       active life\n\t      claim, agreement etc.)\n<\/pre>\n
    From the aforesaid dictionary meanings it becomes  clear
\nthat when an employee resigns his office, he formally relin-
\nquishes or withdraws from his office. It implies that he has
\ntaken  a mental decision to sever his relationship with\t his
\nemployer and thereby put an end to the contract of  service.
\nAs pointed out earlier just as an employer can terminate the
\nservices  of  his employee under the contract.\tSo  also  an
\nemployee can inform his employer that he does not desire  to
\nserve him any more. Albeit, the employee would have to\tgive
\nnotice of his intention to snap the existing relationship to
\nenable the employer to make alternative arrangements so that
\nhis  work does not suffer. The period of notice will  depend
\non  the period prescribed by the terms of employment and  if
\nno  such  period is prescribed, a reasonable  time  must  be
\ngiven before the relationship is determined. If an  employee
\nis  not permitted by the terms of his contract to  determine
\nthe  relationship of master and servant, such an  employment
\nmay  be\t branded as bonded labour. That is  why\t in  Central
\nInland\tWater  Transport Corporation v.\t Brojonath  Ganguly,
\n[1986] 3SCC 156 at page 228 this Court observed as under:\n<\/p>\n
534<\/span><\/p>\n
“By entering upon a contract of employment a person does not
\nsign  a bond of slavery and a permanent employee  cannot  be
\ndeprived of his right to resign. A resignation by an employ-
\nee  would, however, normally require to be accepted  by\t the
\nemployer in order to be effective.”\n<\/p>\n
    In the present case the employee’s request contained  in
\nthe  letter of resignation was accepted by the employer\t and
\nthat brought an end to the contract of service. The  meaning
\nof  term ‘resign’ as found in the Shorter Oxford  Dictionary
\nincludes  ‘retirement’. Therefore, when an  employee  volun-
\ntarily\ttenders\t his resignation it is an act  by  which  he
\nvoluntarily  gives  up his job. We are,\t therefore,  of\t the
\nopinion\t that such a situation would be covered by  the\t ex-
\npression ‘voluntary retirement’ within the meaning of cluase\n<\/p>\n
(i)  of\t Section 2(s)<\/a> of the State Act. In  Santosh  Gupta’s
\ncase Chinnappa Reddy, J. observed as under:
\n“Voluntary retrenchment of a workman or the retrenchment  of
\nthe workman on reaching the age of superannuation can hardly
\nbe described as termination, by the employer, of the service
\nof a workman”.\n<\/p>\n
(Here\t the   word   ‘retrenchment’   has   reference\t  to
\n‘retirement’.)
\n    above  observation clearly supports the view which\tcom-
\nmends to us. We are, therefore, of the opinion that the High
\nCourt was not right in concluding that because the  employer
\naccepted  the  resignation  offer voluntarily  made  by\t the
\nemployee,  he  terminated the service of the   employee\t and
\nsuch  termination,  therefore, fell  within  the  expression
\n‘retrenchment’\trendering him liable to compensate  the\t em-
\nployee\tunder section 6N<\/a>. We are also of the view that\tthis
\nwas a case of ‘volun voluntary retirement’ within the  mean-
\ning of the first exception to section 2(s)<\/a> and therefore the
\nquestion of grant of compensation under section oN does\t not
\narise.\tWe,  therefore, cannot allow the view  of  the\tHigh
\nCourt to stand.\n<\/p>\n
       For the above reasons we allow this appeal, set aside
\nthe orders of the Courts below and hold that the employee is
\nnot  entitled  to any compensation under section 6N<\/a>  of\t the
\nState  Act.  The appeal\t is allowed  accordingly.  No  costs
\nthroughout.\n<\/p>\n
Lal\t\t\t\t       Appeal allowed.\n535<\/span>\n\n\n\n<\/pre>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India J.K. Cotton Spg. And Wvg Mills Co. … vs State Of U.P. And Ors on 27 July, 1990 Equivalent citations: 1990 AIR 1808, 1990 SCR (3) 523 Author: Ahmadi Bench: Ahmadi, A.M. (J) PETITIONER: J.K. COTTON SPG. AND WVG MILLS CO. LTD.,KALPI ROAD, KANPUR Vs. RESPONDENT: STATE OF U.P. AND ORS. […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-257341","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nJ.K. Cotton Spg. And Wvg Mills Co. ... vs State Of U.P. 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