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Bombay High Court

M/S. ARIHANT FABRICS THR. ITS PARTNER AKSHAY KIRAN SHAHversusSHANTARAM KUNDLIK WATHORE

Decided
Disposal
Disposed Off

Holding

The award is modified to a lump‑sum compensation of Rs 10,00,000 in lieu of reinstatement and back‑wages, and the recovery certificate is set aside.

Summary

The petitioner, Arihant Fabrics, challenged a Labour Court award that ordered the reinstatement of the respondent with back‑wages from December 2011. During the hearing the parties agreed that the respondent would accept a lump‑sum settlement of Rs 10,00,000 as full and final compensation. The High Court, on the parties' request, modified the award to reflect this settlement, directed payment within four weeks, and stayed the attachment proceedings against the petitioner. The court also set aside the recovery certificate issued by the Industrial Court on 20 December 2024. Consequently, the writ petition was partly allowed and disposed of.

Issues considered

  • Whether a Labour Court award directing reinstatement and back‑wages can be converted into a lump‑sum settlement by mutual agreement of the parties
  • Whether the High Court can modify the award and set aside the recovery certificate issued by the Industrial Court
  • Whether the attachment proceedings against the petitioner can be stayed pending payment of the settlement

Subjects

  • labour law
  • industrial dispute
  • reinstatement
  • back wages
  • lump‑sum settlement
  • award modification
  • writ petition
  • High Court

Judgment

                    Sonali Mane                                                        3-WP-11514-2026.docx



                                  IN THE HIGH COURT OF JUDICATURE AT BOMBAY

                                            CIVIL APPELLATE JURISDICTION

                                           WRIT PETITION NO. 11514 OF 2026


                    M/S. Arihant Fabrics Thr. Its
                    Partner Akshay Kiran Shah                                   … Petitioner
                             Versus

                    Shantaram Kundlik Wathore                                   … Respondent



                    Mr. Raju Suryawanshi, for the Petitioner.
                    Mr. A. S. Rao for the Respondent.



                                                          CORAM         : SANDEEP V. MARNE, J.

                                                          DATE          : 1 OCTOBER 2026.

                    P.C. :


                    1)            The Petition challenges the Award dated 11 April 2022 passed
                    by the Labour Court, Thane in Reference (IDA) No. 22 of 2014, by which
                    Petitioner is directed to reinstate the Respondent with full back-wages
                    and continuity of service from 25 December 2011. As hearing of the
                    Petition progressed, the parties have agreed for an arrangement for
                    payment of lump-sum compensation of Rs.10,00,000/- to the
                    Respondent as full and final settlement. Accordingly, on 1 September
                    2026 following order is passed:



                                  1) Prima facie, this Court is not inclined to interfere in the impugned
                                  order since Mr. Arvind Narsingh Shah and Mr. Kiran Narsingh Shah had
                                  appeared before the Labour Court by engaging an Advocate.
        Digitally
        signed by
        MANE
MANE SONALI
SONALI DILIP
DILIP  Date:
       2026.10.03
                                                      ___Page No.1 of 2___
        11:04:15
        +0530
                                                         1 October, 2026
Sonali Mane                                                         3-WP-11514-2026.docx




              2) This Court suggested to the parties that the impugned Award passed
              by the Labour Court can be converted into an order for payment into
              lumpsum compensation of Rs. 10 lakh. Both the parties are aggreable to
              the suggestion.

              3) Mr. Suryawanshi, the learned counsel appearing for the Petitioner, on
              instructions, submits that compensation of Rs. 10 lakh shall be paid to
              the Respondent within period of four weeks. Statement is accepted as
              undertaking given to the Court. Accordingly, the action initiated by the
              Tehsildar for attachment for sale of properties of the Petitioner shall
              stand deferred till the next date of hearing.

              4) List the Petition under caption 'for directions', on 1 October 2026
              before which, the Petitioner shall pay to the Respondent compensation
              of Rs. 10 lakh.




2)            Mr. Suryawanshi, the learned counsel appearing for Petitioner
submits that an amount of Rs.10,00,000/- has been paid by the
Petitioner to the Respondent on 1 October 2026. Mr. Rao, the learned
counsel appearing for Respondent confirms this position.



3)            Accordingly, the Award dated 11 April 2022 is modified by
directing that Respondent is entitled to lump-sum compensation of
Rs.10,00,000/- in lieu of reinstatement and back-wages. Since the
compensation is already paid, the order passed by the Industrial Court
on 20 December 2024 issuing the recovery certificate is set aside.



4)            Writ Petition is accordingly partly allowed in above terms and
disposed of.



                                                          [SANDEEP V. MARNE, J.]



                                   ___Page No.2 of 2___
                                      1 October, 2026


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