Holding

The burden of proof to establish that a workman worked 240 days in the relevant year rests on the workman, and delay in seeking reference is to be judged case‑by‑case; the High Court judgment was set aside.

Summary

The Supreme Court examined an appeal by the Chief Engineer, Ranjit Sagar Dam (appellants) against a Labour Court order that reinstated workman Sham Lal and awarded back wages. The central questions were whether the burden of proof to show that a workman had worked at least 240 days in the year preceding termination rested on the employer or the workman, and whether the nine‑year delay in seeking a reference under Section 10 of the Industrial Disputes Act barred the claim. Relying on a series of precedents, the Court held that the initial burden lies on the workman to prove the 240‑day service, and that delay must be assessed on the facts of each case; no fixed limitation period exists. Consequently, the High Court’s decision upholding the Labour Court’s order was set aside. The appeal was allowed, and any reinstatement already effected would not be subject to recovery of salary or emoluments.

Issues considered

The allocation of the burden of proof for establishing 240 days of service under the Industrial Disputes Act, 1947.
Whether a long delay in making a reference under Section 10 of the Industrial Disputes Act defeats the workman's claim.
Whether the High Court erred in upholding the Labour Court’s order that placed the burden on the employer.

Legislation cited

Industrial Disputes Act, 1947s. 10

Subjects

Industrial Disputes Actburden of proof240 days servicetermination of employmentdelay in referencelabour courtreinstatementback wages

Judgment

A CHIEF ENGINEER, RANJIT SAGAR DAM AND ANR.
V.

SHAM LAL

JULY 3, 2006

B [ARIJJT PASAYAT AND LOKESHWAR SINGH PANTA, JJ.]

Labour Laws:

Termination-Burden to prove that the workman completed 240 days of
C service in the year preceding his termination-Held: ls on the workman.

Industrial Disputes Act, 1947-Section I 0-Reference under-Long delay
in seeking reference-Effect of-Held: It would depend on facts of each
D individual case-Law does not prescribe any time-limit for the appropriate
Government to exercise its powers under s. I 0-But this power cannot be
exercised at any point of time and to revive matters which had since been
settled-Power is to be exercised reasonably and in a rational manner.

The question which arose for consideration in the present appeal is ' ,
E whether the High Court erred in upholding the order of the Labour Court
that the burden lay on the Appellant-employer to prove that the
Respondent-workman had not worked for 240 days or more in the year
prior to his termination and that the High Court lost sight of the fact that
the claim made by the workman was highly belated.

F Allowing the appeal, the Court,

HELD: 1. The initial burden of proof was on the workman to show
that he had completed 240 days of service. (84-G)

Range Forest Officer v. S. T. Hadimani, (2002) 3 SCC 25; Essen Deinki
G v. Rajiv Kumar, (2002) 8 SCC 400; Rajasthan State Ganganagar S. Mills Ltd.
v. State of Rajasthan and Anr., (2004) 8 SCC 161; Municipal Corporation,
Faridabad v. Shri Nivas, (2004) 8 SCC 195; MP. Electricity Board v.
Hariram, (2004] 8 SCC 24tl; Manager, Reserve Bank of India, Bangalore v.
S. Mani and Ors., (2005) 5 SCC 100; Batala Cooperative Sugar Mills Ltd v.

H 80
CHIEF ENGINEER, RANJIT SAGAR DAM v. SHAM LAL [PASAYA T, J.] 81

Sowaran Singh, [20051 7 Supreme 165; Surendranagar District Panchayat A
v. Dehyabhai Amarsingh, [20051 7 Supreme 307; R.M Yellatti v. The Asstt.
Executive Engineer, [2006[ I SCC I06 and ONGC Ltd. and Anr. v. Shyamal
Chandra Bhowmik, [200611 SCC 337, relied on.

2. So far as delay in seeking the reference is concerned, no formula
of universal application can be laid down. It would depend on facts of each B
individual case. Law does not prescribe any time-limit for the appropriate
Government to exercise its powers under Section IO of the Industrial
Disputes Act, 1947. It is not that this power can be exercised at any point
of time and to revive matters which had since been settled. Power is to be
exercised reasonably and in a rational manner. A dispute which is stale C
could not be the subject matter of reference under Section IO of the Act.
As to when a dispute can be said to· be stale would depend on the facts
and circumstances of each case. (85-H; 86-A-D)

Nedungadi Bank Ltd. v. K.P. Madhavankutty and Ors., (2000[ 2 SCC
455; SM Nilajkar and Ors. v. Telecom District Manager, Karna/aka, [2003) D
4 SCC 27 and Management ofSudamdih Colliery of Mis. Bharat Coking Coal
ltd. v. Their Workmen represented by Rashtriya Colliery Mazdoor Sangh,
[20061 I Supreme 282, relied on.

3. Above being the position, impugned judgment of the High Court
is indefensible and is set aside. In case the respondent has been reinstated E
pursuant to the order of the Labour Court or the High Court, salary and
other emoluments paid to him shall not be recovered. (87-H; 88-AI

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3253 of2005.

From the Judgment and Order dated 17 .2.2003 of the High Court of F
Punjab and Haryana at Chandigarh in CWP No. 19644 of 2002.

Kuldip Singh, R.K. Pandey and Arun K. Sinha for the Appellants.

The Judgment of the Court was delivered by
G
ARIJIT PASAYAT, J. Challenge in this appeal is to the judgment
rendered by a learned Single Judge of the Punjab and Haryana High Court
dismissing the writ petition filed by the appellants. By the impugned order
learned Single Judge upheld the order passed by the Presiding Officer, Labour
,j. Court, Gurdaspur who held that the burden lies on the employer to prove that H
82 SUPREME COURT REPORTS [2006] SUPP. 3 S.C.R.

A the workman had not worked for 240 days or more in the year imme:diately
preceding the tenninaiion. The alleged date of termination is 13.11.1990.
According to the respondent, he joined in November, 1989 whereas according
to the appellant he joined in August, 1999. Demand for making the reference
was made on 15.12.1999 i.e. after a long period of about 9 years. The workman
was held to be entitled to full back wages from the date of demand notice i.e.
B from 25.2.1993 till his actual reinstatement as the tennination of the services
of the workmen with effect from 13.11.1990 was held to be illegal.

In support of the appeal learned counsel for the appellants submitted
that the High Court has clearly lost sight of the fact that the claim was highly
C belated. No finding was even recorded by the Labour Court on this plea
which was specifically raised. Further the labour court had wrongly held that
it was for the employer to prove that the concerned workman had not worked
for 240 days or more in the year immediately preceding the date of tennination.

There is no appearance on behalf of the respondent.
D
In a large number of cases the position of law relating to the onus to
be discharged has been .delineated. In Range Forest Officer v. S. T. Hadimani,
[2002] 3 sec 25, it was held as follows:

"2. In the instant case, dispute was referred to the Labour Court that
E the respondent had worked for 240 days and his service had been
tenninated without paying him any retrenchment compensation. The
appellant herein did not accept this and contended that the respondent
had not worked for 240 days. The Tribunal vide its award dated
I0.8.1998 came to the conclusion that the service had been tenninated
without giving retrenchment compensation. In arriving at the
F conclusion that the respondent had worked for 240 days the Tribunal
stated that the burden was on the management to show that there was
justification in tennination of the service and that the affidavit of the
workman was sufficient to prove that he had worked for 240 days in
a year.
G 3. For the view we are taking, it is not necessary to go into the
question as to whether the appellant is an "industry" or not, though
reliance is placed on the decision of this Court in State of Gujarat v.
Pratamsingh Narsinh Parmar, [2001] 9 SCC 713. In our opinion the
Tribunal was not right in placing the onus on the management without
H first determining on the basis of cogent evidence that the respondent
CHIEF ENGINEER, RANJIT SAGAR DAM v. SHAM LAL [PASAYAT, J.] 83
had worked for more than 240 days in the year preceding his A
termination. It was the case of the claimant that he had so worked but
this claim was denied by the appellant. It was then for the claimant
to lead evidence to show that he had in fact worked for 240 days in
the year preceding his termination. Filing of an affidavit is only his
own statement in his favour and that cannot be regarded as sufficient B
evidence for any court or tribunal to come to the conclusion that a
workman had, in fact, worked for 240 days in a year. No proof of
receipt of salary or wages for 240 days or order or record of
appointment or engagement for this period was produced by the
workman. On this ground alone, the award is liable to be set aside.
However, Mr. Hegde appearing for the Department states that the C
State is really interested in getting the law settled and the respondent
will be given an employment on compassionate grounds on the same
terms as he was allegedly engaged prior to his termination, within
two months from today."

The said decision was followed in Essen Deinki v. Rajiv Kumar, [2002]
D
& sec 400.

In Rajasthan State Ganganagar.S. Mills Ltd. v. State of Rajasthan and
Anr., (2004] 8 SCC 161, the position was again reiterated in paragraph 6 as
follows: E
"It was the case of the workman that he had worked for more
than 240 days in the year concerned. This claim was denied by the
appellant. It was for the claimant to lead evidence to show that he had
in fact worked up to 240 days in the year preceding his termination.
He has filed an affidavit. It is only his own statement which is in his F
favour and that cannot be regarded as sufficient evidence for any
Court or Tribunal to come to the conclusion that in fact the claimant
had worked for 240 days in a year. These aspects were highlighted
in Range Forest Officer v. S. T. Hadimani, [2002] 3 SCC 25. No
proof of receipt of salary or wages for 240 days or order or record G
in that regard was produced. Mere non-production of the muster roll
for a particular period was not sufficient for the Labour Court to hold
that the workman had worked for 240 days as claimed."

In Municipal Corporation, Faridabadv. Siri Niwas, (2004] 8 SCC 195,
it was held that the burden was on the workman to show that he was working H
84 SUPREME COURT REPORTS [2006) SUPP. 3 S.C.R.

A for more than 240 days in the preceding one year prior to his alleged ..
retrenchment. In MP. Electricity Board v. Hariram, [2004] 8 SCC 246 the
position was again reiterated in paragraph 11 as follows:

"The above burden having not been discharged and the Labour Court
having held so, in our opinion, the Industrial Court and the High
B Court erred in basing an order of reinstatement solely on an adverse
inference drawn erroneously. At this stage it may be useful to refer
to a judgment of this Court in the case of Municipal Corporation,
Faridabad v. Siri Niwas, JT (2004) 7 SC 248 wherein this Court
disagreed with the High Court's view of drawing an adverse inference
c in regard to the non-production of certain relevant documents. This
is what this Court had to say in that regard:

"A court of law even in a case where provisions of the Indian
Evidence Act apply, may presume or may not presume that if a
party despite possession of the best evidence had not produced
D the same, it would have gone against his contentions. The matter,
however, would be different where despite direction by a court
the evidence is withheld. Presumption as to adverse inference for
non-production of evidence is always optional and one of the
factors which is required to be taken into consideration is the I
•.'
background of facts involved in the /is. The presumption, thus,
E
is not obligatory because notwithstanding the intentional non-
production, other circumstances may exist upon which such
intentional non-production may be found to be justifiable on
some reasonable grounds. In the instant case, the Industrial
Tribunal did not draw any adverse inference against the appellant.
F It was within its jurisdiction to do so particularly having regard
to the nature of the evidence adduced by the respondent."

In Manager, Reserve Bank of India, Bangalore v. S. Mani and Ors.,
[2005] 5 SCC I00 a three-Judge Bench of this Court again considered the
G matter and held that the initial burden of proof was on the workman to show
that he had completed 240 days of service. Tribunal's view that the burden
was on the employer was held to be erroneous. In Batala Cooperative Sugar
Mills Ltd. v. Sowaran Singh, (2005) 7 Supreme 165 it was held as follows:

"So far as the question of onus regarding working for more than 240
H days is concerned, as observed by thi~ Court in Range Forest Officer
CHIEF ENGINEER, RANJIT SAGAR DAM v.SHAM LAL [PASAYAT, J.] 85
v. S. T. Hadimani, (2002] 3 sec 25 the onus is on the workman." A
The position was also examined in detail in Surendranagar District Panchayat
v. Dehyabhai Amarsingh, (2005) 7 Supreme 307 and the view expressed in
Range Forest Officer, Siri Niwas, MP. Electricity Board cases (supra) was
reiterated.
B
In R.M Yellatti v. The Asst. Executive Engineer, (2006] 1 SCC 106, the
decisions referred to above were noted and it was held as follows:

"Analyzing the above decisions of this court, it is clear that the
provisions of the Evidence Act in terms do not apply to the proceedings
under section I 0 of the Industrial Disputes Act. However, applying C
general principles and on reading the aforestated judgments, we find
that this court has repeatedly taken the view that the burden of proof
is on the claimant to show that he had worked for 240 days in a given
year. This burden is discharged only upon the workman stepping in
the witness box. This burden is discharged upon the workman adducing D
cogent evidence, both oral and documentary. In cases of termination
of services of daily waged earner, there will be no letter of appointment
or termination. There will also be no receipt or proof of payment.
Thus in most cases, the workman (claimant) can only call upon the
employer to produce before the court the nominal muster roll for the
given period, the letter of appointment or termination, if any, the E
wage register, the attendance register etc. Drawing of adverse inference
ultimately would depend thereafter on facts of each case. The above
decisions however make it clear that mere affidavits or self-serving
statements made by the claimant/workman will not suffice in the
matter of discharge of the burden placed by law on the workman to
prove that he had worked for 240 days in a given year. The above F
judgments further lay down that mere non-production of muster rolls
per se without any plea of suppression by the claimant workman will
not be the ground for the tribunal to draw an adverse inference against
the management. Lastly, the above judgments lay down the basic
principle, namely, that the High Court under Article 226 of the G
Constitution will not interfere with the concurrent findings of fact
recorded by the labour court unless they are perverse. This exercise
will depend upon facts of each case."

The above position was again reiterated in a recent judgment in ONGC
Ltd. and Anr. v. Shyamal Chandra Bhowmik, (2006] I SCC 337. H
A
86 SUPREME COURT REPORTS (2006) SUPP. 3 S.C.R.

So far as delay in seeking the reference is concerned, no formula of
.. .
universal application can be laid down. It would depend on facts of each
individual case.

However, certain observations made by this Court need to be noted. In
Nedungadi Bank Ltd. v. K.P. Madhavankutty and Ors., [2000] 2 SCC 455 it
B was noted at paragraph 6 as follows:

"6. Law does not prescribe any time-limit for the appropriate
Government to exercise its powers under Section I0 of the Act. It is
not that this power can be exercised at any point of time and to revive
matters which had since been settled. Power is to be exercised
c reasonably and in a rational manner. There appears to us to be no
rational basis on which the Central Government has exercised powers
in this case after a lapse of about seven years of the order dismissing
the respondent from service. At the time reference was made no
industrial dispute existed or could be even said to have been
D apprehended. A dispute which is stale could not be the subject-matter
of reference under Section I 0 of the Act. As to when a dispute can
be said to be stale would depend on the facts and circumstances of
each case. When 1the matter has become final, it appears to us to be '
rather incongruous that the reference be made under Section I0 of the '
Act in the circumstances like the present one. In fact it could be said
E that there was no dispute pending at the time when the referenc·e in
question was made. The only ground advanced by the respondent
was that two other employees who were dismissed from service were
reinstated. Under what circumstances they were dismissed and
subsequently reinstated is nowhere mentioned. Demand raised by the
F respondent for raising an industrial dispute was ex-facie bad and
incompetent."

In S.M. Nilajkar and Ors. v. Telecom District Manager, Karnataka,
[2003] 4 sec 27 the position was reiterated as follows: (at para 17)

"17. It was submitted on behalf of the respondent that on account of
G delay in raising the dispute by the appellants the High Court was
justified in denying relief to the appellants. We cannot agree. It is
true, as held in M/s. Shalimar Works Ltd. v. Their Workmen, (supra)
AIR (1959) SC 1217, that merely because the Industrial Disputes Act
does not provide for a limitation for raising the dispute it does not
H mean that the dispute can be raised at any time and without regard
CHIEF ENGINEER. RANJIT SAGAR DAM v. SHAM LAL [PASAYAT, J.] 87

to the delay and reasons therefor. There is no limitation prescribed A
for reference of disputes to an industrial tribunal, even so it is only
reasonable that the disputes should be referred as soon as possible
after they have arisen and after conciliation proceedings have failed
particularly so when disputes relate to discharge of workmen
wholesale. A delay of 4 years in raising the dispute after even B
reemployment of the most of the old workmen was held to be fatal
in Mis. Shalimar Works Limited v. Their Workmen, (supra) AIR (1959)
SC 1217, In Nedungadi Bank Ltd. v. K.P. Madhavankutty and Ors.,
(supra) AIR (2000) SC 839, a delay of 7 years was held to be fatal
and disentitled to workmen to any relief. In Ratan Chandra Sammanta
and Ors. v. Union of India and Ors., (supra) ( 1993) AIR SCW 2214, C
it was held that a casual labourer retrenched by the employer deprives
himself of remedy available in law by delay itself, l~pse of time
results in losing the remedy and the right as well. The delay would
certainly be fatal if it has resulted in material evidence relevant to
adjudication being lost and rendered not available. However, we do
not think that the delay in the case at hand has been so culpable as D
to disentitle the appellants for any relief. Although the High Court
has opined that there was a delay of 7 to 9 years in raising the dispute
before the Tribunal but we find the High Court factually not correct.
The employment of the appellants was terminated sometime in I 985-
86 or 1986-87. Pursuant to the judgment in Daily Rated Casual E
Employees Under P&T Department v. Union of India, (supra) AIR
(1987) SC 2342, the department was formulating a scheme to
accommodate casual labourers and the appellants were justified in
awaiting the outcome thereof. On 16-1-1990 they were refused to be
accommodated in the scheme. On 28-12-1990 they initiated the
proceedings under the Industrial Disputes Act followed by conciliation F
proceedings and then the dispute was referred to the Industrial Tribunal
cum-Labour Court. We do not think that the appellants deserve to be
non suited on the ground of delay."

The above position was highlighted recently in Employers in relation G
to the Management of Sudamdih Colliery of Mis Bharat Coking Coal Ltd. v.
Their Workmen represented by Rashtriya Colliery Mazdoor Sangh, (2006) 1
Supreme 282.

Above being the position, impugned judgment of the High Court is
indefensible and is set aside.
H
88 SUPREME COURT REPORTS [2006) SUPP. 3 S.C.R.

A The appeal is allowed without any order as to costs. In case the
respondent has been reinstated pursuant to the order of the Labour Court or
the High Court, salary and other emoluments paid to him shall not be
recovered.

B.B.B. Appeal allowed.
B

"\.