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Hindustan Petroleum Corporation Limited Vs. D.N. Vidhate and anr. - Court Judgment

SooperKanoon Citation
SubjectLabour and Industrial
CourtMumbai High Court
Decided On
Case NumberNotice of Motion No. 201 of 2003 in Writ Petition No. 840 of 2003
Judge
Reported in2003(4)ALLMR152; 2003(5)BomCR482; 2004(1)MhLj202
ActsIndustrial Disputes Act, 1947 - Sections 17B
AppellantHindustan Petroleum Corporation Limited
RespondentD.N. Vidhate and anr.
Appellant AdvocateJ.P. Cama, Senior Counsel and ;S.K. Talsania, Adv., i/b., Sanjay Udeshi and Co.
Respondent AdvocateK.K. Singhvi, Senior Counsel and ;S.S. Pakale, Adv. for Respondent No. 1
Excerpt:
labour and industrial - payment - section 17 b of industrial disputes act, 1947 - section 17 b has been enacted with view to give relief to workman who has been ordered to be reinstated under award of labour court or industrial tribunal during pendency of proceedings in which said award is under challenge before high court or apex court - object is to relieve to certain extent hardship that is caused to workman due to delay in implementation of award - payment which is required to be made by employer to workman is in nature of subsistence allowance - such amount would not be refunded or recoverable from workman even if award is set aside by high court or apex court - in above view it is proper to limit concerned section to extent of wages which were drawn by workman when he was in service.....r.m.s. khandeparker, j.1. heard the learned advocates for the parties. perused the records.2. this notice of motion is taken out under section 17b of the industrial disputes act, 1947, hereinafter called as 'the said act' by the employee who is the respondent no. 1 in the writ petition no. 840 of 2003, filed by the employer-corporation. it is the contention of the employee that since the time of issuance of the order of dismissal from service i.e., from 19-1-2001, the employee has not been employed in any establishment and that in view of issuance of the rule in the said writ petition and grant of stay of the implementation and operation of the award dated 1-11-2002, under which the employee was directed to be reinstated with full backwages, the employee is entitled for subsistence.....
Judgment:

R.M.S. Khandeparker, J.

1. Heard the learned Advocates for the parties. Perused the records.

2. This notice of motion is taken out under section 17B of the Industrial Disputes Act, 1947, hereinafter called as 'the said Act' by the employee who is the respondent No. 1 in the Writ Petition No. 840 of 2003, filed by the employer-Corporation. It is the contention of the employee that since the time of issuance of the order of dismissal from service i.e., from 19-1-2001, the employee has not been employed in any establishment and that in view of issuance of the rule in the said writ petition and grant of stay of the implementation and operation of the Award dated 1-11-2002, under which the employee was directed to be reinstated with full backwages, the employee is entitled for subsistence allowance in terms of section 17B of the said Act during the pendency of the writ petition. According to the employee, the last drawn wages, as on December, 2000, were Rs. 12,038/- per month, but in terms of the settlement dated 23-5-2002 stood revised to the tune of Rs. 19,470/- per month, effective from 1-10-1998. On the other hand, it is the case of the employer that the employee is gainfully employed and undertakes civil work of repairing and contracts for construction of houses and interior designing and therefore he is gainfully employed since the termination of his services and hence is not entitled for any relief under section 17B of the said Act.

3. Placing reliance in the decisions in the matters of Hindustan Tin Works Pvt. Limited v. The Employees of Hindustan Tin Works Pvt. Limited and Ors., reported in : (1978)IILLJ474SC , Oriental Containers Ltd., Bombay v. Engineering Workers' Association and Ors., reported in 1996 (1) CLR 934, Taj Services Limited v. Industrial Tribunal and Ors., reported in : (2000)ILLJ1012Del , and Municipal Corporation of Delhi v. Shri Ramkishan and Anr., reported in : (2001)ILLJ1411Del , the learned Advocate for the employee has submitted that in the absence of any cogent material being placed on record disclosing gainful employment of the employee since the termination of his services by the petitioners, mere report of a detective agency placed on record does not disprove the contention of the employee that the employee has not been gainfully employed since the termination of his services and the burden which otherwise lies upon the employer in relation to the proof of gainful employment of the employee has not been discharged and, therefore, the employee is entitled for the relief prayed for. On the other hand, placing reliance in the decisions in the matters of Bombay Film Laboratories Pvt. Limited v. L. G, Vasule and Ors., reported in 1994 2 CLR 413, Dena Bank v. Kiritikumar T. Patel, reported in : (1999)2SCC106 , and Indiana Engineering Works (Bombay) Pvt. Limited v. The Presiding Officer, 5th Labour Court and Ors., reported in (1995) 2 CLR 890, the learned Advocate for the employer has submitted that the materials placed on record along with the report of the detective agency disclose that the employee is gainfully employed in the business of construction activities and interior designing and has even printed visiting cards in his name in relation to the said business activities and, that the said materials have been placed on record, have not been disputed by the employee, and therefore the petitioners thereby have discharged their burden. It is further contended that even though the employee has filed the rejoinder affidavit, he has not come out with the whole truth in relation to his income and therefore, adverse inference is to be drawn in that regard. According to the learned Advocate for the employer, the onus having not been discharged by the employee, there are no materials available on record to justify the contention of the employee that he is not gainfully employed and hence the application under section 17B of the said Act should be dismissed.

4. The parties have also sought to raise controversy as to whether the expression 'full wages last drawn' relates to the wages which were actually drawn by the employee on the day of termination of his services or whether it would include what the employee could be entitled to in accordance with the settlement, if any, arrived at subsequent to such termination but being made enforceable with retrospective effect including the date of termination of such an employee, and secondly whether the claim for subsistence allowance under section 17B of the said Act to be ordered to be paid should be with effect from the date of the Award or from the date of stay of the Award by this Court.

5. Section 17B of the said Act provides that where in any case, a Labour Court, Tribunal or National Tribunal by its award directs reinstatement of any workman and the employer prefers any proceedings against such award in a High Court or the Supreme Court, the employer shall be liable to pay such workman, during the period of pendency of such proceedings in the High Court or the Supreme Court, full wages last drawn by him, inclusive of any maintenance allowance admissible to him under any rule if the workman had not been employed in any establishment during such period and an affidavit by such workman had been filed to that effect in such Court, provided that where it is proved to the satisfaction of the High Court or the Supreme Court that such workman had been employed and had been receiving adequate remuneration during any such period or part thereof, the Court shall order that no wages shall be payable under this section for such period or part, as the case may be. Apparently, the question of entertaining any application under section 17B of the said Act can arise only when the matter is pending before the High Court. The matter can be said to be pending in the High Court when the High Court takes cognisance of any such matter either by way of issuing rule or admitting the matter for final consideration or by passing any order in relation to any grievance made by the employer against the Award passed by the Labour Court or Tribunal or National Tribunal directing reinstatement of the workman.

6. The first point which arises for consideration in the matter is as to whether the employee is entitled for wages during the pendency of the present writ petition. The same will have to be answered by ascertaining from the records placed before this Court as to whether the employee had been gainfully employed during the relevant period. Undoubtedly, the expression 'gainfully employed' has not been used in the said provision of law, however, that is the settled position of law in view of the number of decisions of the Apex Court as well as this Court.

7. The employee, along with his application in the notice of motion, has filed an affidavit in support thereof and has clearly stated that he is not in employment of any establishment from the time of his dismissal from the services by the employer till the date of filing of the application. He has also clarified in the affidavit that his last drawn wages in December, 2000 were Rs. 12,038/- per month, however, as per the revised salary with effect from 1-10-1998 the wages payable were Rs. 19,470/- per month.

8. In reply to the said application, the employer has stated that the employee is gainfully employed inasmuch as that he undertakes civil work and repairing and also takes contracts for construction of houses and interior designing and he has a mobile phone and a telephone at his residence as well as at his shop and this was verified by the employer by engaging the services of a private detective agency by name M/s Globe Private Detective Bureau. In support of the said contention, the employer has sought to rely upon the letter dated 20-2-2003 from M/s Globe Private Detective Bureau, copy of the visiting card stated to have been printed by the employee and a kutcha bill issued by the business undertaking stated to be belonging to the employee and furnished to the petitioners by the detective agency.

9. In rejoinder, the employee has stated that the business in question belongs to his wife Devayani Vidhate and the registration of the said establishment under the Bombay Shops and Establishments Act, 1948 also stands in the name of his wife. However, as the business suffered loss, it was closed by the end of March, 2003, and even the premises which were occupied for the business were surrendered in April, 2003 and his wife stopped doing the said business since then, and the telephone in the shop was also surrendered in the middle of April, 2003 itself. He has further stated that occasionally he used to assist his wife in the said business and he received no remuneration in whatsoever form from his wife for assisting her in the said business. According to the employee, he has a mobile telephone since 1999 and is used mostly for the Union's work. According to the employee, the bills for sale of materials were issued while he was assisting his wife in her business.

10. It is the contention of the petitioner-corporation that the employee has not discharged the burden of proof that the employee is gainfully employed in spite of the fact that the employer has amply proved that he is in the business of construction activities and that in that connection reliance is sought to be placed in the decision of the learned single Judge, as he then was, in Indiana Engineering Works (Bombay) Pvt. Limited v. The Presiding Officer, 5th Labour Court and Ors. (supra).

11. In Indiana Engineering Works' case, it was observed that:--

'...... responsibility of proving gainfully employment has been cast on the Employer, the workman has no duty or responsibility to explain anything in this behalf, before the Tribunal adjudicating the industrial dispute. In any event, the Petitioner Employer successfully discharged the said burden. The onus thereafter shifted to the workman and he was obliged to disclose full particulars of his gainful employment to the Labour Court adjudicating the industrial dispute. Instead of being honest and straightforward with the Labour Court, by disclosing full particulars of his gainful employment, the Second Respondent chose to be mendacious and denied on oath the fact of his employment. This certainly is most reprehensible and should disentitle him for relief. I am of the considered view that the dismissed workman also owes a duty to the industrial adjudicator to honestly disclose full particulars of the facts which are purely within his knowledge and that any attempt to mislead the Tribunal must surely be looked at askance.'

According to the learned Advocate for the employer, once the Corporation having disclosed that the employee was gainfully employed in the business of construction activities and is having a shop in that regard, and even visiting card as well as bills of sale of materials having been produced on record and those facts having not been disputed, it was necessary for the employee to disclose full particulars about his income from the said business, and having not done so, considering the ruling in Indiana Engineering Works' case, the employee clearly has failed to discharge the onus of disproving the fact of gainful employment, established by the employer.

1.2. It is to be noted that the contention of the employer that the employee has been gainfully employed in construction activities has been specifically denied by the employee. He has further stated that he had been only assisting his wife in the said business and further that the business was in the name of his wife and in that regard has sought to rely upon the certificate/licence issued under the Bombay Shops and Establishments Act, 1948 disclosing the name of the employer of the said establishment and which apparently discloses the name of the wife of the employee. He has also placed on record the intimation of the fact of closure of the business by his wife to the authorities. In Indiana Engineering Works' case, the employer, after employing the services of a detective agency, was able to get the information regarding the employment of the employee therein with Artson Engineering Company and as a proof thereof had also placed a copy of the application in the handwriting of the employee, addressed to the said company, disclosing the biodata of the said employee and other particulars required to obtain employment in the said company, and in the said particulars it was disclosed by the employee that he had, in fact, worked as Mechanical Draughtsman in engineering companies such as Vainuna Engineering Private Limited from 11-5-1985 to November, 1985 on a specific salary, and further giving separate details of the companies in which he had worked and the evidence of two officers from the Artson Engineering Private Limited, placed on record in the said case, also disclosed that the employee was still in the service of the said company. In the background of those facts which had come on record, it was observed that the employer had successfully discharged the burden regarding the gainful employment of the employee from the time of his dismissal and therefore the onus had shifted upon the workman to disclose full particulars regarding his gainful employment as the claim for backwages can be entertained during the period during which the employee had remained unemployed and not for the period during which he was gainfully employed, in case of order of reinstatement along with payment of backwages. In that context, it was observed in Indiana Engineering Works' case that the workman owes duty to the industrial adjudicator to honestly disclose the full particulars of the facts which are purely within his knowledge. Apparently, it was in relation to the facts clearly established by the employer regarding the gainful employment of the employee after his dismissal and in spite of such evidence having been produced by the employer, if the employee merely keeps quiet by contending that he was not gainfully employed, certainly the Labour Court or the Industrial Court, as the case may be, cannot be justified in ordering payment of full backwages. In order to justify the direction for payment of backwages in those circumstances, it was observed that it was necessary for the employee to come out clean and disclose everything regarding his income derived from his employment, which has been established by the employer by placing the necessary materials on record in that behalf. The observations in Indiana Engineering Works' case, therefore, cannot be straightaway applied to the case in hand wherein the employee has specifically denied the allegation regarding gainful employment and further has established, with documentary proof, that the business in question belonged to his wife and he was merely assisting his wife from the time he was dismissed from the service of the employer.

13. This does not, however, mean that the employee is not required to disclose the particulars of facts which are purely within his knowledge. Applying this principle to the case in hand, if we analyse the materials on record, can it be said that the employee has suppressed any fact which is purely within his knowledge? It has been the specific case of the employee that the business which is referred to by the employer exclusively belonged to his wife and that he had been merely assisting his wife. Certainly, it cannot be presumed that amongst the spouses there would necessarily be a written contract regarding any assistance being rendered by one of the spouses to the other in the business. Social fabric in India does not encourage such a distrust amongst the spouses, at least to this date, that the spouses assisting in each other's business, have necessarily to enter into a written agreement regarding such assistance to be rendered to one other and that it has necessarily to be for monetary consideration. Being so, merely because there is no written document regarding the assistance which was rendered by the respondent to his wife in her business, there cannot, be any inference drawn that the employee has not come out with the necessary particulars of the facts within his ;knowledge. It is a matter of record that the employee was in service of the employer and from the time of his dismissal, he had been contesting the order of dismissal and even has been successful in obtaining the order of reinstatement in the services of the employer. It is also a matter of record that the said Award has been the matter of challenge in this petition and the implementation thereof has been stayed by this Court. In the background of these facts, there is nothing wrong if the employee, who has been armed with the Award in his favour, hopes to get his relief granted under the Award restored to him by this Court at the end of the disposal of the petition and with the said hope even the employee takes interest merely in assisting his spouse or his family members in his or her business, that by itself cannot lead to the conclusion that such an employee is gainfully employed so as to deny the benefit which the employee is entitled to under the statutory provision contained in section 17B of the said Act. Viewed from this angle, the contentions on behalf of the respondents based on the decision in Indiana Engineering Works' case, are to be rejected.

14. I am fortified in the above view by the decision of the Delhi High Court in Taj Services Limited v. Industrial Tribunal and Ors. (supra), wherein it was held that:--

'Even in the case of respondent Nos. 2, 4 and 10 the allegation is that they are running their own business but the said allegation is denied by the learned Counsel for the respondents. According to the learned Counsel for the respondents, even if the workman runs some petty business for the survival of himself and his family, it will not disentitle the workman for the benefits under section 17B of the Industrial Disputes Act. The learned Counsel for the respondents also contended that the proviso to section 17B of the Industrial Disputes Act would be attracted only in the case of employment under another employer and receiving adequate remuneration. I find force in the contention of the learned Counsel, As per section 17B the workman is required to file an affidavit to the effect that he had not been 'employed in any establishment'. Hence under the proviso to section 17B of the Industrial Disputes Act what is required to be proved by the employer is that the workman had been employed in any establishment and had been receiving adequate remuneration from such employment. Being employed for remuneration in an establishment means employment under another employer. It is different from running one's own business or trade in order to remain alive to see the end of the litigation.'

On similar lines the assistance without monetary consideration rendered to the business of family members cannot be said to be an employment under any other employer.

15. While considering the main object behind incorporating the provision under section 17B of the said Act, the Apex Court in the case of Dena Bank v. Kiritikumar ., Patel (supra), has ruled that:--

'Section 17B has been enacted by Parliament with a view to give relief to a workman who has been ordered to be reinstated under the award of a Labour Court or the Industrial Tribunal during the pendency of proceedings in which the said award is under challenge before the High Court or the Supreme Court. The object, underlying the provision is to relieve to a certain extent the hardship that is caused to the workman due to delay in the implementation of the award. The payment which is required to be made by the employer to the workman is in the nature of subsistence allowance which would not be refundable or recoverable from the workman even if the award is set aside by the High Court or this Court. Since the payment is of such a character, Parliament thought it proper to limit it to the extent of the wages which were drawn by the workman when he was in service and when his services were terminated and therefore used the words 'full wages last drawn'. To read these words to mean wages which would have been drawn by the workman if he had continued in service if the order terminating his services had not passed since it has been set aside by the award of the Labour Court or the Industrial Tribunal, would result in so enlarging the benefit as to comprehend the relief that has been granted under the award that is under challenge. Since the amount is not refundable or recoverable in the event of the award being set aside, it would result in the employer being required to give effect to the award during the pendency of the proceedings challenging the award before the High Court or the Supreme Court without his being able to recover the said amount in the event of the award being set aside. We are unable to construe the provisions contained in section 17B to cast such a burden on the employer.'

16. The decision of the Apex Court referred to above clearly discloses that the benefit which an employee is entitled to get under section 17B is in the nature of subsistence allowance and the same is neither refundable nor recoverable even though ultimately the award in favour of the workman is set aside. The Apex Court has clearly laid down in the said ruling that it is not permissible to read down the clause 'full wages last drawn' to enlarge the benefit under the said provision to the employee. Bearing this in mind, the decision in Municipal Corporation of Delhi v. Shri Ramkishan and Anr. (supra), relied upon by the learned Advocate for the respondent, can no more be held to be a good law as the said decision was delivered in consonance with the decision of the Karnataka High Court in Vishveswaraya Iron and Steel Limited v. M. Chandrappa and Anr. 1993 (67) F.L.R. 825, which was held to be not a good law by the Apex Court in Dena Bank's case.

17. In Bombay Film Laboratories Pvt. Limited v. L. G. Vasule and Ors. (supra), the Division Bench of this Court had held that:--

'...... plain reading of provisions of section 17B makes it clear that the Court has power to direct payment of wages only for the period when the enforcement of the award of reinstatement is stayed. It is not open for the Court to direct payment from the date of the award ..,.'

As against this, attention was drawn to the decision the Delhi High Court in the case of Municipal Corporation of Delhi. As already observed above, the decision in the case of Municipal Corporation of Delhi endorses the views expressed by the Karnataka High Court in Vishveswaraya Iron and Steel Limited v. M. Chandrappa and Anr. (supra) and the same being held to be not a good law by the Apex Court in Dena Bank's case, and further the Division Bench of this Court having specifically ruled that the order for direction for payment of backwages under section 17B can be from the date of stay of enforcement of the Award and not from the date of the Award, which is binding on this Court, the question of ordering payment of backwages from the date prior to the date of stay granted by this Court to the impugned Award cannot arise.

18. The Division Bench of this Court in Oriental Containers Ltd., Bombay v. Engineering Workers' Association and Ors. (supra) had held that:--

',..... Section 17B of the I. D. Act requires a workman to file an affidavit before the High Court or the Supreme Court where the employer has preferred any proceedings against the Award of reinstatement of the workman that he 'had not been employed in any establishment' during the pendency of such proceedings. Once such an affidavit has been filed by the workman, he has discharged the onus on him, By virtue of the provisions of section 17B, the burden of proof then shifts to the employer. It is then for the employer to satisfy the High Court or the Supreme Court that the workman, in fact, had been employed and he had been receiving adequate remuneration during such period or part thereof. If the employer succeeds in satisfying the Court in that behalf, the Court then shall order that the wages contemplated by this section shall not be payable by the employer to the workman for the period of the pendency of the proceedings before the Court or part thereof. In the instant case, the workmen have discharged the burden of proof cast upon them. The employer has not placed any material before this Court that the workmen had been receiving adequate remuneration during this period. The employer has referred to a report of some detective agency but has not filed an affidavit stating that the report has been accepted to be correct. The report of the detective agency is not per se, any evidence. Evidence has to be led in proof thereof and no evidence has been led in the instant case and no reliance can be placed upon the report of the detective agency as is sought to be contended.......'

Apparently, in the said case, the employer, apart from placing on record the detective agency's report, had not filed even an affidavit in support thereof. That is not the case in hand. The employer in the case in hand, apart from filing an affidavit, has also placed on record the copy of the visiting card and the bills which were stated to have been issued by the employee to the representative of the detective agency when such representative had allegedly visited the shop premises wherein the employee was stated to have been employed. Being so, the said decision is of no help to the employee. At the same time, it is also a matter of record that in relation to whatever materials placed on record by the employer in support of its contention that the employee is gainfully employed, have been explained by the employee in his rejoinder. Undoubtedly, the fact of printing of visiting cards with the name of the employee has not been denied. However, merely on the basis of the visiting cards, it is not safe to conclude that the employee is gainfully employed so as to deny him the benefit under section 17B of the said Act when the specific case of the employee is to the effect that he had been assisting his wife in her business and the materials on record disclose that the business indeed belonged to his wife. The registration of the business under the Bombay Shops and Establishments Act, 1948 was in the name of his wife and it is the specific case of the employee that the wife was otherwise unemployed and the same has not been controverted by the employer.

19. Reliance is also sought to be placed in the decision of the Apex Court in the matter of MA Hindustan Tin Works Pvt. Limited v. The Employees of Hindustan Tin Works Pvt. Limited and Ors. (supra) to contend that the employee is entitled to full backwages, while arguing that the normal rule is that the burden lies upon the employer to establish gainful employment of the employee. However, in my considered opinion, the decision is nowhere helpful to the employee in a case under section 17B of the said Act. The decision is squarely in relation to the claim for full backwages pursuant to the order of reinstatement. It has nothing to do with the proceedings under section 17B of the said Act.

20. Taking into consideration the materials on record and the rulings referred to above, therefore, the employer has not been able to disprove the contention of the employee that he has not been gainfully employed during the relevant period.

21. The last point which needs to be considered is in relation to the quantum of wages which the employee would be entitled to claim, According to the employee, though the actual last drawn wages were Rs. 12,038/- per month, in terms of the settlement he is entitled to claim Rs. 19,470/- per month. The settlement is dated 23-5-2002. The settlement is stated to be effective retrospectively from 1-10-1998 and, therefore, according to the employee, he is entitled to claim the amount in terms of the said settlement as the last drawn wages.

22. As already observed above, the Apex Court in Dena Bank's case has clearly held that the expression 'full wages last drawn' has to be given strict meaning and any interpretation thereof, enlarging the benefit may result in prejudice to the employer inasmuch as the Award under which the employee is entitled to claim reinstatement if is set aside, the amounts ordered to be paid under section 17B are neither refundable nor recoverable. The contention of the employee that in terms of the settlement he would be entitled to claim Rs. 19,470/- per month on the ground that the settlement has been made effective retrospectively from 1-10-1998, much prior to the date of his termination, cannot be considered while ignoring the fact that the employee would be entitled for such benefit provided he succeeds in the petition. The question relating to the claim of difference, between the actual amount of Rs. 12,038/- and the amount of Rs. 19,470/-, which may be payable under the settlement will have to be adjudicated and to be decided at appropriate stage. That issue cannot be considered and adjudicated upon while dealing with the matter under section 17B of the said Act, and in such proceedings what is to be seen is the actual and factual salary which was drawn by the employee on the date of termination of his services, and as in the case in hand the employees services were terminated in December, 2000, what is required to be considered is the actual salary which was drawn by the employee in the said month and, admittedly, the same was Rs. 12,038/-.

23. In the result, therefore, the employee is held to be entitled for the monthly wages of Rs, 12,038/- as the benefit under section 17B of the said Act from the date of passing of the order of stay of the impugned order i.e., from 4-4-2003. The notice of motion is hereby disposed of with no order as to costs.


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