Holding

The two sub‑divisions are separate establishments, so the periods of service cannot be aggregated for continuity, rendering the tribunal’s award of reinstatement with full back‑wages illegal.

Summary

Om Pal was engaged as a daily‑wage worker by the Haryana Urban Development Authority, first in Sub‑division No.2 for 145 days (Oct 1994‑Feb 1995) and then in Sub‑division No.3 for 90 days (Mar‑Jul 1995). After his services were terminated he raised an industrial dispute. The Industrial Tribunal‑cum‑Labour Court treated the two sub‑divisions as a single establishment, counted the total 235 days as continuous service under s.25F r/w s.25B of the Industrial Disputes Act, 1947, and ordered his reinstatement with full back‑wages. On appeal, the Supreme Court held that the two sub‑divisions are distinct establishments with separate cadre strengths; therefore, service in one does not accrue to continuity in the other, and the tribunal’s award was illegal. Consequently, the appeal was allowed, the reinstatement order set aside, and the employer was directed to pay a nominal sum of Rs.25,000 to the respondent.

Issues considered

Whether service rendered by a daily‑wage worker in two different sub‑divisions of the same authority constitutes continuous service under s.25F read with s.25B of the Industrial Disputes Act, 1947.
Whether the Industrial Tribunal‑cum‑Labour Court could lawfully grant reinstatement with full back‑wages in the circumstances.

Legislation cited

Industrial Disputes Act, 1947s. 11A, s. 25B, s. 25F

Subjects

industrial disputecontinuity of servicedaily wagerreinstatementback wagesseparate establishmentsIndustrial Disputes Actdiscretionary relief

Judgment

HARYANA URBAN DEVELOPMENT AUTHORITY A
v.
OM PAL

APRIL IO, 2007

[S.B. SINHA AND MARKANDEY KATJU, JJ.] B

Industrial Disputes Act, 1947:

ss. 25F and 25G-Continuity of service-Daily wager worked in one
establishment for 145 days-Thereafter he worked in another establishment C
for 90 days-Two establishments distinct and separate having different cadre
strength-Hence, period during which workman was working in one
establishment would not enure to his benefit when he was recruited separately
in another establishment particularly when he was not transferred-Labour
laws. ·
D
s.JIA-Reinstatement with full back-wages-Power of labour court
while granting-Held, despite wide discretionary power conferred upon the
Labour Courts under s. 11 A, relief of reinstatement with full back-wages not
to be granted automatically only because it would be lawful to do so-lt
would depend on the fact situation obtaining in each case-On facts, workman E
worked for short period, therefore labour court committed illegality in
directing reinstatement with full back wages.

Respondent was appointed as a daily wager. He worked for period of 145
days in sub Division No.2 for period of October 94 to Feb., 1995. He, however,
worked in Sub-division No.3 for a period of90 days from March, 95 to July, F
95. His services were terminated. He raised industrial dispute.

The Industrial Tribunal directed his reinstatement and full back wages
on the ground that the services rendered by respondent in both the Divisions
should be counted for the purpose of s.25F r/w. s.25B of Industrial Disputes
Act, 1947. Appellant employer unsuccessfully filed the writ petition. Hence G
the present appeal.

Partly allowing the appeal, the Court

HELD: 1. The two Sub-Divisions constituted two different
1091 H
1092 'SUPREME COURT REPORTS [2007) 4 S.C.R.
.(

A establishments. Only because there is one Controlling Authority, the same
by itself would not mean that the establishments were not separate. [Para 3)
(1093-G; 1094-A)

2. Respondent did not pro~uce before the Industrial Tribunal-cum-
Labour Court his offers of appointment If offers of appointment had been
B issued in his favour by the two Sub-Divisions separately, the same ipso facto
would lead to the conclusion that they were separate and distinct. If his
appointment was only on the basis of entry in the muster roll(s), the
designation of the authority who was authorized to appoint him as a daily-
wager would be the determinative factor. It is not the case of the respondent
C that.he was appointed in both the establishments by the same authority.
[Para 4) (1094-B)
3. The Industrial Tribunal-cum-Labour Court unfortunately did not go
into the said question at all. If both the establishments are treated to be one
establishment, for the purpose of reckoning continuity of service within the
D meaning of s.25B of the Act, as was held by the Tribunal, a person working
at different point of time in different establishments of the statutory authority,
would be entitled to claim reinstatement on the basis thereof. However, in that
event, one establishment even may not know that the workman had worked in
another establishment. In absence of such acknowledge, the authority
retrenching the workman concerned would not be able to comply with the
E statµtory provisions contained in s.25F of the Act. Thus, once· two
establishments are held to be separate and distinct having different cadre
strength of the workmen, if any, the period during which the workman was
working in one establishment would not enure to his ben~fit when ·he was
recruited separately in another establishment, particularly when he was not
F transferred from one Sub-Division to the other. (Para 5) (1094-C-E)
Union of India and Ors. v. Jummasha Diwan, [Z006) 8 SCC 544,
referred to.
4. Moreover, it is now also well-settled that despite a wide discretionary
power conferred upto the Industrial Courts under s.llA of the 1947 Act, the
G relief of reinstatement with full back-wages should n6t be granted
automatically only because it would be lawful to do sc;>. Grant of relief would
depend on the fact situation obtaining in each case. It will depend upon several
factors; one of which would be as to whether the recruitment was effected in
terms of.the statutory provisions operating in the field. (Para 7) (1095-B-C)

H 5. Respondent worked for a very short period. He only worked in 1994-
HARYANAURBANDEVELOPMENTAUTHORITYv.OMPAL[S.B.SINHA,J.] 1093

95. The Industrial Tribunal-cum-Labour Court, therefore, committed an A
illegality, while passing an award in the year 2003, directing the reinstatement
: of the respondent with full back-wages. Although the respondent was not
entitled to any relief, whatsoever, the appellant is directed to pay him a sum of
Rs.25,000/-. (Para 8] (1095-D]

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1869 of2007. B
~- From the Judgment and Order dated 08.04.2004 of the High Court of
Punjab and Haryana at Chandigarh in CWP No. 5948 of 2004.
,-
Satinder Gulati, Kamaldeep Narang and Dr. Kailash Chand for the
Appellant. c
Sanjay Bansal, Reepak Kansai and G.K. Bansal for the Respondent.

The Judgment of the Court was delivered by

S.B. SINHA, J. 1. Leave granted. D
-...... l
2. Respondent herein was appointed as a daily-wager. From October,
1994 to February, 1995, he worked for a period of 145 days in Sub-Division
No.2, Panipat. He, however, worked in Sub-Division No.3 for a period of 90
days from March 1995 to July, 1995. His services were terminated. An industrial
dispute was raised questioning validity of the said order of termination. The E
said industrial dispute was referred by the Appropriate Government to the
Industrial Tribunal-cum-Labour Court, Panipat, for its determination. It was
registered as Reference No.59 of 1999. By an award dated 28.2.2003, the
Industrial Court on the premise that the services rendered by the respondent
in both the Sub-Divisions should be counted for the purpose of Section 25F
F
I"
read with Section 25B of the Industrial Disputes Act, 1947, directed his
reinstatement with continuity of service and full back-wages from the date of
demand notice i.e. 14.9.1995. A writ petition filed thereagainst by the appellant
herein was dismissed. The appellant has, therefore, filed this appeal by special
leave.
G
3. The short question which arises for consideration by us in this
appeal is as to whether in the aforementioned fact situation, the Industrial
...... (
Tribunal-cum-Labour Court was justified in directing reinstatement of the
respondent with full back-wages and continuity of service. n has not been
denied or disputed that the two Sub-Divisions constituted two ·different
H
~

1094 SUPREME COURT REPORTS [2007] 4 S.C.R.
.
~

i::-
A establishments. Only because there is one Controlling Authority, the same by
itself would not mean that the establishments were not separate.

4. Respondent did not produce before the Industrial Tribunal-cum-
Labour Court his offers of appointment. If offers of appointment had been
issued in his favour by the two Sub-Divisions separately, the same ipso facto
B would lead to the conclusion that they were separate and distinct. If his
appointment was only on the basis of entry in the muster roll(s), the
A
designation of the authority who was authorised to appoint him as a daily-
wager would be the determinative factor. It is not the case of the respondent
that he was appointed in both the establishments by the same authority.
·'
c 5. The Industrial Tribunal-cum-Labour Court unfortunately did not go
into _the said question at all. If both the establishments are treated to be one
establishment, for the purpose of reckoning continuity of service within the
meaning of Section 258 of the Act, as was held by the Tribunal, a person
working at different point of time in different establishments of the statutory
D authority, would be entitled to claim reinstatement on the basis thereof.
However, in that event, one establishment even may not know that the
workman had worked in another establishment. In absence of such a
).
knowledge, the authority retrenching the workman concerned would•not be
able to comply with the statutory provisions contained in Section 25F of the
Act. Thus, once two establishments are held to be separate and distinct
E having different cadre strength of the workmen, if any, we are of the opinion
that the period during which the workman was working in one establishment
would not enure to his benefit when he was recruited separately in another
establishment, particularly when he was not transferred from one Sub-Division
to the other. In this case he was appointed merely on daily wages.
F
6. In Union ofIndia and Ors v. Jummasha Diwan, [2006] 8 SCC 544, this
Court opined : "

" .... There are several establishments of the Railway Administration. If
a workman voluntarily gives up his job in one of the establishments
G and joins another, the same would not amount to his being in
continuous service. When a casual employee is employed in different
establishments, may be under the same employer, e.g., the Railway
Administration of India as a whole, having different administrative
set-ups, different requirements and different projects, the concept of
continuous service cannot be applied and it cannot be said that even
H in such a situation he would be entitled to a higher status being in
HARYANA URBAN DEVELOPMENT AUTHORITYv. OM PAL [S.B. SINHA, J.] } 095

continuous service. It is not in dispute that the establishment of A
Appellant 3 herein had started a project. His recruitment in the said
establishment would, therefore, constitute a fresh employment. In a
case of this nature, the Respondent would not be entitled to his
seniority. If the project came to a close, the requirements of Section
25-N of the Act were not required to be complied with."
B
7. Moreover, it is now also well-settled that despite a wide discretionary
power conferred upon the Industrial Courts under Section I IA of the 1947
Act, the relief of reinstatement with full back-wages should not be granted
automatically only because it would be lawful to do so. Grant ofreliefwould
depend on the fact situation obtaining in each case. It will depend upon C
several factors; one of which would be as to whether the recruitment was
effected in terms of the statutory provisions operating in the field, if any.

8. Respondent worked for a very short period. He only worked, as
noticed hereinbefore, in 1994-95. The Industrial Tribunal-cum-Labour Court,
therefore, in our opinion committed an illegality, while passing an award in the D
year 2003, directing the reinstatement of the respondent with full back-wages.
Although we are of the opinion that the respondent was not entitled to any
relief, whatsoever, we direct the appellant to pay him a sum of Rs.25,000/-.

9. This appeal is allowed to the aforementioned extent. However, in the
facts and circumstances of this case, there shall be no order as to costs. E
D.G. Appeal allowed.