THE MANAGEMENT OF REGIONAL CHIEF ENGINEER P.H.E.D. RANCHIversusTHEIR WORKMEN REP. BY DISTRICT SECRETARY

                       [2018] 11 S.C.R. 759                             759


   THE MANAGEMENT OF REGIONAL CHIEF ENGINEER                            A
                P.H.E.D. RANCHI
                                 v.
     THEIR WORKMEN REP. BY DISTRICT SECRETARY
                  (Civil Appeal No. 9832 of 2018)                       B
                      SEPTEMBER 20, 2018
[ABHAY MANOHAR SAPRE AND S. ABDUL NAZEER, JJ.]
      Labour Laws:
       Back wages – When can be claimed – Courts below awarded          C
full back wages directing reinstatement of the workmen – Held: A
workman has no right to claim back wages if he has been reinstated
– It is necessary for the workman to plead and prove that he was
not gainfully employed – Employer is also entitled to prove otherwise
– However, initial burden is on the workman – Direction of courts
                                                                        D
below to award full back wages has caused prejudice to the employer
– In exercise of jurisdiction u/Art. 142 of the Constitution, in the
interest of justice, 50% of total back wages is awarded – Evidence
– Burden to prove – Constitution of India – Art. 142 – Industrial
Disputes Act, 1947 – s. 25F.
      Partly allowing the appeal, the Court                             E

      HELD: 1. A workman has no right to claim back wages
from his employer as of right only because the Court has set
aside his dismissal order in his favour and directed his
reinstatement in service. It is necessary for the workman in such
cases to plead and prove with the aid of evidence that after his        F
dismissal from the service, he was not gainfully employed
anywhere and had no earning to maintain himself or/and his family.
The employer is also entitled to prove it otherwise against the
employee, namely, that the employee was gainfully employed
during the relevant period and hence not entitled to claim any          G
back wages. Initial burden is, however, on the employee. [Paras
11 and 12] [762-G-H; 763-A-B]
      2. The Court may decline to award the back wages in its
entirety whereas in some cases, it may award partial depending
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                                  759
760            SUPREME COURT REPORTS                     [2018] 11 S.C.R.


A     upon the facts of each case by exercising its judicial discretion in
      the light of the facts and evidence. [Para 13] [763-B]
            3. The Court is required to keep in consideration several
      factors, and then to record a finding as to whether it is a fit case
      for award of the back wages and, if so, to what extent. In the
B     present case neither the Labour Court and nor the High Court
      kept in consideration the principles of law. Similarly, no party to
      the proceedings either pleaded or adduced any evidence to prove
      the material facts required for award of the back wages enabling
      the Court to award the back wages. [Paras 14 and 15] [763-E-G]
C            4. Direction of the Courts below awarding full back wages
      to the workman has caused prejudice to the appellant (employer).
      In exercise of powers under Article 142 of the Constitution of
      India for doing substantial justice to the parties concerned, it
      would be just and proper and in the interest of justice to award to
      these 37 workmen 50% of the total back wages. [Paras 18, 19
D     and 20] [764-C-E]
            M.P. State Electricity Board v. Jarina Bee(Smt.) (2003)
            6 SCC 141 : [2003] 1 Suppl. SCR 535; G.M. Haryana
            Roadways v. Rudhan Singh (2005) 5 SCC 591 : [2005]
            1 Suppl. SCR 569; U.P. State Brassware Corporation
E           v. Uday Narain Pandey (2006) 1 SCC 479 : [2005] 5
            Suppl. SCR 609; J.K. Synthetics Ltd. v. K.P. Agrawal &
            Anr. (2007) 2 SCC 433 : [2007] 2 SCR 60, Metropolitan
            Transport Corporation v. V. Venkatesan (2009) 9 SCC
            601 : [2009] 12 SCR 583; Jagbir Singh v. Haryana
F           State Agriculture Marketing Board & Anr. (2009) 15
            SCC 327) : [2009] 10 SCR 908; Deepali Gundu
            Surwase v. Kranti Junior Adhyapak Mahavidyalaya
            (D.Ed.) & Ors. (2013) 10 SCC 324 : [2013] 9 SCR 1 –
            relied on.

G                            Case Law Reference
      [2003] 1 Suppl. SCR 535        relied on              Para 13
      [2005] 1 Suppl. SCR 569        relied on              Para 13
      [2005] 5 Suppl. SCR 609        relied on              Para 13
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  MGMT OF REGIONAL CHIEF ENGR. v. THEIR WORKMEN                                761
               REP. BY DISTT. SECY.

[2007] 2 SCR 60                    relied on                 Para 13           A
[2009] 12 SCR 583                  relied on                 Para 13
[2009] 10 SCR 908                  relied on                 Para 13
[2013] 9 SCR 1                     relied on                 Para 13
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 9832                      B
of 2018
      From the Judgment and Order dated 02.02.2017 of the High
Court of Jharkhand at Ranchi in L.P.A. No. 484 of 2008
      Atulesh Kumar, Adv. for the appellant.
                                                                               C
      Abhijeet Sinha, Adv. for the respondent.
      The Judgment of the Court was delivered by
      ABHAY MANOHAR SAPRE, J. 1. Leave granted.
      2. This appeal is directed against the final judgment and order          D
dated 02.02.2017 of the High Court of Jharkhand at Ranchi in L.P.A.
No.484 of 2008 whereby the Division Bench of the High Court dismissed
the appeal filed by the appellant herein and upheld the order dated
08.07.2008 passed by the Single Judge of the High Court in W.P.(L)
No.3962 of 2006.
                                                                               E
       3. Few facts need to be mentioned hereinbelow for the disposal
of the appeal, which involves a short issue.
       4. The short question, which arises for consideration in this appeal,
is whether the Courts below, namely, the High Court and the Labour
Court were justified in awarding full back wages to the 37 workmen             F
represented by Workmen Union after setting aside their dismissal order
holding it to be bad in law being in contravention of Section 25-F of the
Industrial Disputes Act, 1947 (hereinafter referred to as “I.D. Act”)
and, in consequence, directing reinstatement of these workmen in services
of the appellant in their Public Health and Engineering Department
(PHED).                                                                        G
      5. The appellant is the Department of the State of Jharkhand
[Public Health and Engineering Department (PHED)] whereas the
respondent is the Workmen Union representing the interest of the
workmen working in the Public Health and Engineering Department
(PHED).                                                                        H
762            SUPREME COURT REPORTS                          [2018] 11 S.C.R.


A            6. The State made a reference under Section 10 of the I.D. Act
      to the Labour Court, Ranchi at the instance of the respondent-Union to
      decide the following dispute:
            “Whether the dismissal and non absorption of 37 acting daily
            wages Hastrashid employees as mentioned in schedule “K”
B           in work charged establishment by Public Health Engg.
            Division, East Ranchi (Department of PHED, Jharkhand)
            is lawful. If not, what other reliefs their employees are
            entitled to?”
             7. By award dated 29.06.2005, the Labour Court (Annex.P-1)
C     answered the reference in respondent- Union’s favour and directed re-
      instatement of 37 workmen with payment of full back wages in Reference
      Case No.6 of 2002.
            8. The appellant (employer), felt aggrieved by the award of the
      Labour Court, filed writ petition in the High Court of Jharkhand. The
D     Single Judge of the High Court, by order dated 08.07.2008, dismissed
      the writ petition filed by the appellant and affirmed the award passed by
      the Labour Court.
             9. Being aggrieved by the order of the Single Judge, the appellant
      filed intra court appeal. By impugned order, the Division Bench of the
E     High Court dismissed the appeal and upheld the order of the Single Judge,
      which gave rise to filing of this appeal by way of special leave by the
      appellant-employer in this Court.
             10. Having heard the learned counsel for the parties and on perusal
      of the record of the case, we are inclined to allow the appeal in part and
F     while modifying the impugned order award 50% back wages to the
      workmen in place of full wages.
             11. In our considered opinion, the Courts below completely failed
      to see that the back wages could not be awarded by the Court as of right
      to the workman consequent upon setting aside of his dismissal/termination
      order. In other words, a workman has no right to claim back wages from
G
      his employer as of right only because the Court has set aside his dismissal
      order in his favour and directed his reinstatement in service.
            12. It is necessary for the workman in such cases to plead and
      prove with the aid of evidence that after his dismissal from the service,
      he was not gainfully employed anywhere and had no earning to maintain
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  MGMT OF REGIONAL CHIEF ENGR. v. THEIR WORKMEN                               763
   REP. BY DISTT. SECY. [ABHAY MANOHAR SAPRE, J.]

himself or/and his family. The employer is also entitled to prove it          A
otherwise against the employee, namely, that the employee was gainfully
employed during the relevant period and hence not entitled to claim any
back wages. Initial burden is, however, on the employee.
       13. In some cases, the Court may decline to award the back wages
in its entirety whereas in some cases, it may award partial depending         B
upon the facts of each case by exercising its judicial discretion in the
light of the facts and evidence. The questions, how the back wages is
required to be decided, what are the factors to be taken into consideration
awarding back wages, on whom the initial burden lies etc. were
elaborately discussed in several cases by this Court wherein the law on
these questions has been settled. Indeed, it is no longer res integra.        C
These cases are, M.P. State Electricity Board vs. Jarina Bee(Smt.),
(2003) 6 SCC 141, G.M. Haryana Roadways vs. Rudhan Singh,
(2005) 5 SCC 591, U.P. State Brassware Corporation vs. Uday
Narain Pandey, (2006) 1 SCC 479, J.K. Synthetics Ltd. vs. K.P.
Agrawal & Anr., (2007) 2 SCC 433, Metropolitan Transport                      D
Corporation vs. V. Venkatesan, (2009) 9 SCC 601, Jagbir Singh vs.
Haryana State Agriculture Marketing Board & Anr., (2009) 15 SCC
327) and Deepali Gundu Surwase vs. Kranti Junior Adhyapak
Mahavidyalaya(D.Ed.) & Ors., (2013) 10 SCC 324.
      14. The Court is, therefore, required to keep in consideration          E
several factors, which are set out in the aforementioned cases, and then
to record a finding as to whether it is a fit case for award of the back
wages and, if so, to what extent.
       15. Coming now to the facts of the case at hand, we find that
neither the Labour Court and nor the High Court kept in consideration         F
the aforesaid principles of law. Similarly, no party to the proceedings
either pleaded or adduced any evidence to prove the material facts
required for award of the back wages enabling the Court to award the
back wages.
      16. On the other hand, we find that the Labour Court in one line        G
simply directed the appellant (employer) to pay full back wages for a
long period to 37 workmen while directing their reinstatement in service.
      17. We, however, find that the High Court in para 9 of the order
placed reliance on the decision of this Court in Deepali Gundu Surwase
(supra) for holding that the question of back wages is covered by this
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764             SUPREME COURT REPORTS                          [2018] 11 S.C.R.


A     decision. In our view, the High Court erred in so observing. It should
      have seen that in the case of Deepali Gundu Surwase (supra) itself,
      this Court referred decisions, which we have mentioned in para 13 above
      and then in para 38 of Deepali Gundu Surwase, this Court culled out
      the ratio of all the cited cases. Thereafter, this Court in Deepali Gundu
      Surwase’ case granted relief to the concerned workers on the facts
B
      involved in that case. In our opinion, the High Court did not apply the
      ratio of the decision in Deepali Gundu Surwase (supra) to the facts of
      this case properly and only quoted one para of the judgment in Deepali
      Gundu Surwase(supra) which contained general observations. Those
      observations had to be read in juxtaposition with para 38 which culled
C     out the ratio of all the case law on the subject.
            18. We cannot, therefore, concur with such direction of the Courts
      below awarding full back wages to the workman which, in our opinion,
      has certainly caused prejudice to the appellant (employer).
            19. However, having regard to the facts and circumstances of the
D     case, we consider it just and proper and in the interest of justice to
      award to these 37 workmen 50% of the total back wages.
             20. This we award to the workmen in exercise of our powers
      under Article 142 of the Constitution of India for doing substantial justice
      to the parties concerned having reiterated the legal principles which
E     govern the question of award of back wages.
             21. In the light of the foregoing discussion, the appeal succeeds
      and is allowed in part. Impugned order is modified to the extent indicated
      above.

F            22. Let the amount be worked out and paid by the appellant to the
      respondent-workmen after proper verification within three months from
      the date of this judgment.


      Kalpana K. Tripathy                                      Appeal partly allowed.

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