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IN THE HIGH COURT OF DELHI AT NEW DELHI

SUBJECT : SERVICE MATTER



WP(C) No. 9824/2003 and WP(C) No. 9830/2003
Reserved on: 26.7.2006
Date of Decision: September 05, 2006

Govt. of National Capital Territory of Delhi
Through: Chief Engineer, Flood Control and Drainage
Department, Division No. 5, 4th Floor,
ISBI, Kashmere Gate, Delhi . .... Petitioner
Through : Ms. Avnish Ahlawat, Advocate


versus

Shri Shyam Babu, S/o Shri Mahavir Singh
Baildar Labour Union
Aggarwal Bhawan,
GT Road, Tis Hazari
Delhi. ......... Respondents
Through: Mr. Sanjay Ghose, Advocate


JUSTICE SHIV NARAYAN DHINGRA


1. By this judgment I shall dispose of two writ petitions i.e W.P. (C ) 9824/2003 and
W.P. (C ) No. 9830/2003.

2. The facts relevant for deciding the two writ petitions are that respondent Shyam Babu
was engaged as a daily wager Beldar in October 1984. He was being paid daily wages for
days he worked. He sent a demand notice dated 12.3.1984 to the petitioner demanding
that he should be regularized in the petitioners department in the regular pay scale. A
statement of claim was filed by the respondent before Conciliation Officer. Petitioner
denied the right of the respondent to claim regularization in the written statement. No
settlement could be arrived at and the following reference was referred by the appropriate
government to the Labour Court :-

Whether the non-regularization of Shri Shyam Babu in the pay scale of Rs.196- 232 is
legal and justified if not what directions are necessary in this respect.

3. It appears that after raising the dispute of the regularization, respondent stopped going
for work. He did not go to the work for the month of June and July 1984. However,
respondent's stand is that he was marked absent for the month of June and July 1984
despite his having attended the duties continuously. He alleged in a demand notice of
October, 1984 that on 1.8.1984 management disallowed him to continue on daily wages
and thereby terminated his services, without following the provisions of section 25F, G
nd H of the Industrial Disputes Act 1947 ( for short the Act) . He again raised an
industrial dispute. The stand of the management was that management had not terminated
the services of the respondent. Respondent worked as daily wager from 4.10.82 to May
1984 with many breaks in between and he did not report for the job to the office after
31.5.1984. Following dispute was referred by the appropriate government for
adjudication before the Labour Court :-
Whether the termination of services of Shri Shyam Babu is illegal/ unjustified. If so
what directions are necessary in this respect.

4. Both the IDs were adjudicated by the Tribunal together and the Awards were passed in
both the IDs on 27.5.2003. Petitioner has challenged the legality of the Award by these
writ petitions. It is contended by the petitioner that appointment of regular employees,
including Beldar in the petitioners department is made as per the rules and procedures
framed for recruitment and promotion by the State Government. The Rules and procedure
of State Government are applicable to Flood Control Department of the government. The
regular appointments are made only to the sanctioned posts strictly in compliance with
the rules and regulations. However, daily wages appointments are made keeping in view
the exigency of the services in the Flood Control Department from time to time
depending upon climatic conditions. The respondent was paid wages from October 1982
to May 1984 @ Rs. 11.60/- which was prevalent rate. Respondent had some other plan in
his mind and he served a notice upon the petitioner for regularization and also filed an
application before the Conciliation Officer seeking a regular pay scale. After filing this
application the respondent stopped coming for work. The respondent then filed a second
application before the Conciliation Officer in October 1984 alleging that his services
were terminated from 1.8.1984. Both the applications were opposed by the petitioner
since respondent being a daily wager had no right of regularization de horse the rules and
regulations of the petitioners department and since he had stopped coming for work and
his services were never terminated. It is contended by the petitioner that during the
Conciliation Proceedings before Conciliation Officer he was asked to come and join the
work but he refused. The respondent before the Conciliation Officer had been insisting
that his regularization should be adjudicated upon and he did not accept to resume duties
till the dispute of regularization was decided. This indicated ulterior motives of the
respondent who had no intention to continue to work as daily wager.

5. Petitioner further submitted that there has been an agreement between the respondent
and the union (who filed claim and pursued the I.Ds) in writing that respondent shall pay
25% of the total amount received by him in case he succeeds in the I.Ds to the union and
it is for this reason that the respondent did not join the duties and worked somewhere else
and the union continued to contest the dispute with the management. In the statement of
claims before Tribunal the workman did not give his residential address but gave address
of the union. The General Secretary of the union, contesting on behalf of the workman,
earlier was Sh. C.P. Aggarwal, an Advocate by profession and presently was Sh.Rajiv
Aggarwal again an Advocate by profession and Sh. Rajiv Aggarwal appears in the Court
as an Advocate in independent capacity as well as in capacity of secretary of union of
which he is General Secretary. The union is a pocket union of Aggarwals' father and son
and the entire contest of the dispute was only for the monetary gain with malafide
intention as respondent worked somewhere else all along and in fact there was no dispute
at all since the petitioner had not terminated the services of the respondent neither
respondent was entitled for regularization under law. It is also submitted that during the
proceedings while workman was being represented by Sh. C.P. Aggarwal, Advocate as
Secretary of the union, the petitioner was denied assistance of Ms. Ashoka Jain, Advocate
and the Labour Court debarred her from appearing before the Tribunal vide its order
dated 19.9.1988. After the death of Sh. C.P. Aggarwal, Sh. Rajiv Aggarwal, Advocate
took over as General Secretary of the union and started appearing in the matter. He took
objection on appearance of Ms. Bindiya Savera, who was representing the petitioner.
Again Tribunal passed an order dated 2.9.2002 debarring Ms. Bindiya Savera from
appearing before Tribunal. As Ms. Bindiya Savera was debarred from appearing, an
Engineer of the Department who had no legal background was compelled to cross
examine the workman and lead evidence.

6. It is further submitted that those daily wagers who had joined department in the year
1982 had continued as daily wager till the year June 1989 were regularized only in 1989
under a scheme prepared under the orders of the Supreme Court. Despite the fact that the
workman was only a daily wager, Labour Court passed an Award directing his
reinstatement and regularization with effect from 1.4.1988 in the pay scale of Rs.196-
232.

7. Both the Awards have been challenged on the grounds (i) While workman was being
represented through expert Advocates who were having hold on the labour matters, the
department was deprived from taking help of Advocate, therefore, there was violation of
principles of natural justice (ii) Flood Control Department was not an industry (iii) There
was no termination of the workman. Workman himself had left the services by not
reporting to duties. He was not interested in joining the duties and had turned down the
offer made to him for joining duties during the conciliation proceedings. (iv) That the
order directing full back wages to the workman who had not contributed anything to the
work of department was illegal. The workman had not given his address or whereabouts
so the department could not found out about his job during pendency of proceedings. The
principle of no work no wages should have been applied. (v) No departmental enquiry
is required to be held in case daily wager stops coming to work. A daily wager is free to
report or not to report for work according to his choice.

8. In the counter affidavit it is stated while Award was passed on 27.5.2003 writ was filed
in January 2004, therefore, writ should be dismissed on the ground of delay and latches.
The writ petition was filed only after respondent preferred an application dated 5.11.2003
under section 33C (1) of the Act for recovery of his back wages amounting to Rs. 5,75,
899/- and asking for reinstatement. The fact that the respondent was a daily wager and he
raised a dispute about his regularization is not denied. It is alleged that respondent was
terminated with effect from 1.8.1984 in contravention of provisions of the Act.
Respondent reported for duty during the month of June and July 1984 but his attendance
was not marked and he was not allowed to join duties with effect from 1.8.1984. The
petitioner was an industry in view of judgment in Bangalore Water Supply and Sewage
Board Vs. A. Rajappa- AIR 1978 SC 548.

9. It is contended that if the petitioner was aggrieved by the orders of Labour Court
disallowing Ms. Bindiya Savera and Ms. Ashoka Jain to appear, the petitioner could have
challenged the order before this Court. Since respondent was in service of the petitioner
continuously for more than 240 days during the year preceding termination of his
services, he could be retrenched only in accordance with rules and if it is accepted that
respondent had left the job of his own, the petitioner should have written letter calling the
respondent to resume duties. The petitioner admittedly failed to do so. Therefore, order of
Tribunal reinstating the respondent with full back wages was legally correct. It was
denied that there was any malafide intention of the respondent that he was not interested
in joining the duties and petitioner should be put to strict proof of the malafides.

10. It was also contended that since respondent had been reinstated with back wages he
was deemed to be in service of the petitioner since October 1982 and therefore he was
entitled for regularization. Co-workers of the respondent had already been regularized in
the year 1988, therefore, Tribunal rightly held that respondent who had been granted
reinstatement was liable to be regularized

11. I have heard learned counsel for the parties and perused the record.

12. The Tribunal came to the conclusion that the workman had worked for more than 240
days during the period of 12 months preceding 31.5.1984. No letter was sent by the
management i.e petitioner asking the workman to report for duty after 31.5.1984 in case
he was running absent. Petitioner had not complied with the provisions of section 25F
and G of the Act. The Tribunal relied upon H.D. Singh Vs. Reserve Bank of India and
Ors.. (1985) 4 SCC 201, and held that workman was entitled to be reinstated.

13. It is undisputed that workman was working as a daily wager. A daily wager gets
wages for the days he reports for work. Since he is not a regular employee, it is natural
that he may seek better employment. A daily wager is not bound by any rules of service,
since he is not regularly appointed as per rules of recruitment of the department. The
question arises whether management is supposed to chase a daily wager and bring him
back to the services even if he is unwilling to serve the management. I consider that
where daily wager is unwilling to work with the management and does not report for duty
not for one day but continuously for a long period, management is not supposed to serve
a notice on the daily wager asking him to come and join duties. Management can engage
any other daily wager out of the several other persons available for work. Provisions of
section 25 F of the Act read as under:-

25F. Conditions precedent to retrenchment of workmen- No workman employed in any
industry who has been in continuous service for not less than one year under an employer
shall be retrenched by that employer until-
(a) the workman has been given one month's notice in writing indicating the reasons for
retrenchment and the period of notice has expired, or the workman has been paid in lieu
of such notice, wages for the period of the notice;
(b) the workman has been paid, at the time of retrenchment, compensation which shall be
equivalent to fifteen days' average pay ( for every completed year of continuous service)
or any part thereof in excess of six months; and
(c) notice in the prescribed manner is served on the appropriate Government ( for such
authority as may be specified by the appropriate Government by notification in the
Official Gazette)

14. It is clear that in order to attract section 25F of the Act an action of retrenchment of
the workman is envisaged on the part of the employer. Section 2 (oo) defines
retrenchment as under:-
(oo) retrenchment means the termination by the employer of the service of a workman
for any reason whatsoever, otherwise than as a punishment inflicted by way of
disciplinary action but does not include-
(a) voluntary retirement of the workman; or
(b) retirement of the workman on reaching the age of superannuation if the contract of
employment between the employer and the workman concerned contains a stipulation in
that behalf; or
(bb) termination of the service of the workman as a result of the non-renewal of the
contract of employment between the employer and the workman concerned on its expiry
or of such contract being terminated under the stipulation in that behalf contained therein
or)
(c) termination of the service of a workman on the ground of continued ill- health.

15. The act of retrenchment as defined in Section 2 (oo) envisages a conscious and
deliberate action on the part of the employer of terminating the services of the workman.
Dictionary meaning of the termination is to bring to an end. Thus retrenchment has to
be an intentional act of management of bringing the services of workman to an end. If
employer does no act to bring the services of workman to an end and the workman stops
working with the employer of his own, this would be termination of the services by the
workman himself and it would not amount to retrenchment because it is not the
termination of the services by the employer. I consider that where it is shown that a
workman has left the services of his own and has stopped reporting for duty, no
termination can be inferred on the part of the employer.

16. The respondent in this case was working as a daily wager. He served a demand notice
for regularization on the management in March 1984. If the management wanted to
terminate the workman because he had served a demand notice, the management would
not have allowed the workman to work after 12.3.1984 when the demand notice was
served. The respondent continued to work with the management for March, April and
May 1984. Management did not stop workman from working with it despite the
respondent having raised a dispute about his regularization. The management appeared
before the Conciliation Officer and denied the right of the respondent to be regularized. It
cannot be presumed that the management who had allowed the workman to work after
receipt of demand notice for two and a half month, had suddenly stopped marking the
attendance of the workman despite his reporting for work. Petitioner is not a private
company and none of the officer of the petitioner was going to benefit financially or
personally by not marking attendance of a labour who was coming and doing work.
Moreover, it is not the case of the respondent that when he was paid wages for months of
June and July, he filed any claim before the appropriate authority claiming wages for
these two months. It is not his case he reported to Labour Inspector at any time that he
was not being allowed to resume duty since he has raised an industrial dispute. After not
reporting for duty with effect from 1.6.1984, the respondent sent another demand notice
to the petitioner in October 1984 i.e after 4 and half months. Had the workman been out
of employment, his survival would have been prime concern for him and he would have
immediately approached the Labour Inspector / department raising grievance that he was
not being allowed to join duty or he was not paid salary. These grievances were not
raised. The reason given by the Labour Court that not giving of a notice to the respondent
calling him back amounted to termination is illogical. Law does not cast an obligation on
an employer that he should serve a notice on an unwilling employee and request him to
come and continue with the organization. Law casts certain obligations on the employer
only when the employer terminates the services of the workman.

17. The Tribunal observed that management has failed to bring any evidence on record to
establish that workman himself has stopped coming for duty. Tribunal grossly
misdirected itself. There was no onus on the management to prove that workman had
himself stopped coming for duty. The onus was on the workman to prove that he had
gone to the management and he was refused to join the duty. Only the workman could
have been asked to prove that his services were terminated and he had not voluntarily
stopped going to the organization. Merely because a person has worked for 240 days, the
management is not supposed to keep him tied up with it even if he is not willing to work
with the organization nor for this reason onus can be put on employer to prove that he
had not terminated the service.

18. The argument of the counsel for the petitioner that the industrial dispute was raised by
the union only for its non-financial gains seems to have force. It is not disputed that
Mr.Aggarwal is practicing advocate and is also general secretary of the union. It is
workman's own case that there is an agreement between the union and the workman of
payment of 25% of the amount received by the workman. From this agreement it is clear
that whatever amount is being paid to the workman even under section 17-B, 25% of that
goes to the pocket of the union(read Advocate). I consider that raising of industrial
dispute and filing of the claim were not the act of the workman, but they were filed by the
union taking power of attorney from the workman for its own gain. The advocate and the
union can be identified with each other. The address of the workman is deliberately not
given. It seems this has become a practice that workman is asked to work somewhere
else. He is asked not to disclose his address. His address is given that of union office and
the union after obtaining power of attorney contest the case through out and then takes
25% of the amount.

19. Counsel for the respondent argued that charging of a percentage of the amount was
not illegal and cited judgment of the Supreme Court in 1985 SCC LandS 331- Balmer
Lawrie Workers' Union Bombay and another v. Balmer Lawrie and Company Limited
and others ., wherein Supreme Court has held that there was nothing objectionable in the
settlement arrived at between the union and the employer that employer shall deduct 15%
of the gross arrears payable to each employee as contribution to the trade union funds.
Supreme Court observed that the workman was merely paying the price of advantage
obtained. In the case cited by the counsel for respondent there was rivalry between
recognized union and non-recognized union and the contention raised was that such
compulsory deductions without consent of the workman under section 20 (2) (b) of the
Payment of Minimum Wages Act will be unconstitutional in as much as such union
would force and compel the workman against their will to join the union which has
acquired the status of recognized union. Supreme Court observed:
Shorn of embellishment such a provision would show that benefits and liabilities both
must be shard equally. If under a settlement with the representative union some benefits
accrue to the workmen, and upon a true interpretation of Section 20(2)(b), it is held all
encompassing and therefore binding on all workmen and the employer alike, all the
benefits would be available to the workmen who are not members of the representative
union and who may have formed a rival union. If these workmen could not be denied the
benefits they would enjoy an unfair advantage. If from the package deal covered by the
settlement, they draw benefits and abjure liabilities. Heads I win and tails you loss could
hardly be a fair and just approach in settling inter-union disputes. Therefore, a Clause like
Clause 17 of the Settlement has to be understood in the context of strengthening the trade
union movement and to free it from financial constraints. Workmen who are members of
a union may pay fee for the representative union all workmen acquire benefit or monetary
advantage, the members and non members alike can be made to make common sacrifice
in the larger interest of trade union movement and to strengthen the trade union which by
its activities acquired the benefits for all workmen. Payment to trade union fund in these
circumstances can be styled as quid pro quo for benefits acquired. Therefore, we see
nothing objectionable in Clause 17 of the Settlement which directs the employer to
deduct 15% of the gross arrears payable to each employee under the settlement as
contribution to the trade union funds.

20. One has to distinguish between a union of the workman of the establishment and a
union opened by an advocate. A union of the employees of the establishment works for
the benefit of the employees. A general union being run by an Advocate to augment his
profession cannot be equated with a genuine union of employees of an establishment. The
only activity of this union seems to be to contest cases of workman on percentage basis.
This cannot be called even a genuine union activity.

21. The second Award passed by the Labour Court directs regularization's of the
petitioner who was a daily wager. The law in respect of regularization and absorption has
been laid down by the Supreme Court in Secretary State of Karnataka Vs. Uma Devi-
2006 4 SCC (1) , Supreme Court has observed that it is time that Courts desist from
issuing orders preventing regular selection or recruitment at the instance of such persons
who are litigious employees and open back door entries into public services or help
those who have not secured regular appointment as per procedure established. The power
of State as employer is more limited than that of a private employer. State is subject to
constitutional limitations and it cannot exercise powers arbitrarily. The so called equity
arising out of temporary employment or engagement or daily wagers and continuation of
such persons in work for certain length of time cannot be pitted against the right of a
qualified citizen to apply for appointment and selection as per rule of law. The sympathy
for daily wagers cannot be allowed to overshadow the concept of rule of law and scheme
of constitution for appointment to posts. The Court observed that the States and its
instrumentality, on occasion will have to appoint persons in posts which are temporary or
on daily wages as additional hands without following the required procedure to discharge
duties in respect of posts or to undertake some urgent work. This right of the Union of
India or of the State Government cannot but be denied and there is nothing in the
Constitution which prohibits such engaging of persons temporarily or on daily wages, to
meet the needs of the situation. But the fact that such engagements are resorted to, cannot
be used to defeat the very scheme of public employment. Supreme Court, further
observed:-
One aspect arises. Obviously, the State is also controlled by economic considerations
and financial implications of any public employment. The viability of the department or
the instrumentality or of the project is also of equal concern for the State. The State
works out the scheme taking into consideration the financial implications and the
economic aspects. Can the court impose on the State a financial burden of this nature by
insisting on regularization or permanence in employment, when those employed
temporarily are not needed permanently or regularly As an example, we can envisage a
direction to give permanent employment to all those who are being temporarily or
casually employed in a public sector undertaking. The burden may become so heavy by
such a direction that the undertaking itself may collapse under its own weight. It is not as
if this had not happened. So, the court ought not to impose a financial burden on the State
by such directions, as such directions may turn counter-productive.

22. The regularization of the temporary/ casual or daily wager cannot be directed if the
initial entry itself is not against any sanctioned vacancy. The question of regularizing the
incumbent on such a non existing vacancy would never survive for consideration.
Supreme Court cautioned that courts must be careful in ensuring that they do not interfere
unduly with the economic arrangements of the affairs of State or its instrumentalities and
they do not lend themselves as instrument to facilitate by-passing constitutional mandate.
The Courts should not be swayed by the fact that the concerned daily wager/ temporary
employee/ casual employee has worked for sometime and in some cases for considerable
length of time. It is not as if the person who accepts an engagement either temporary or
casual in nature, is not aware of the nature of his employment. He accepts the
employment with eyes open. It may be true that he is not in a position to bargain - not at
arms length - since he might have been searching for some employment so as to eke out
his livelihood and accepts whatever he gets. But on that ground alone, it would not be
appropriate to jettison the constitutional scheme of appointment. A total embargo on such
casual or temporary employment is not possible, given the exigencies of administration
and if imposed, would only mean that some people who at least get employment
temporarily, contractually or casually, would not be getting even that employment when
securing of such employment brings at least some succor to them, such appointments are
not based in the real sense. When a person enters a temporary employment or gets
engagement as a contractual or casual worker and the engagement is not based on a
proper selection as recognized by the relevant rules or procedure, he is aware of the
consequences of the appointment being temporary, casual or contractual in nature. Such a
person cannot invoke the theory of legitimate expectation for being confirmed in the post
when an appointment to the post could be made only by following a proper procedure for
selection. Supreme Court further observed that when the court is approached for relief by
way of a writ, the court must necessarily ask itself whether the person before it had any
legal right to be enforced. In the guise of upholding rights under Article 21 of the
Constitution of India, a set of persons cannot be preferred over a vast majority of people
waiting for an opportunity to compete for State Government.

23. I consider the writ petitions are liable to be allowed on above ground and it is not
necessary for this Court to go into the question whether petitioner department is an
industry or not.

24. As a result of discussions made above, both writ petitions are allowed. Both Awards
dated 27.5.2003 made by the Tribunal in ID No. 390/1987 and ID No.128/1987 are
hereby set aside.

JUSTICE SHIV NARAYAN DHINGRA