Supreme Court of India
HARYANA STATE CO-OPERATIVE SUPPLY MARKETING FEDERATION LIMITEDversusSANJAY
- Citation
- 2009 INSC 940
- Decided
- 22 July 2009
- Disposal
- Appeal(s) allowed
- Bench
- TARUN CHATTERJEE
Holding
The two establishments are distinct; service cannot be clubbed, so the respondent did not satisfy the 240‑day continuous service requirement and Section 25‑F does not apply.
Summary
The respondent, Sanjay, worked as a casual chowkidar for the District Manager of HAFED in Jind from August to December 1998 (145 days) and thereafter for the District Manager of HAFED in Hissar from January to May 1999 (112 days). He claimed that, having completed more than 240 days of continuous service in the year preceding his termination, the employer was required to follow the procedure under Section 25‑F of the Industrial Disputes Act, 1947, and that his dismissal was illegal. The Industrial Tribunal‑cum‑Labour Court and the Punjab & Haryana High Court reinstated him with back wages. On appeal, the Supreme Court examined whether service in the two separate establishments could be clubbed to satisfy the 240‑day requirement. It held that the Jind and Hissar offices are distinct establishments, each governed by separate contracts, and therefore the periods of service cannot be combined. Consequently, the respondent did not have the requisite continuous service, Section 25‑F was not attracted, and the lower courts' award was set aside.
Issues considered
- Whether periods of service rendered in two different establishments of the same corporation can be clubbed to satisfy the 240‑day continuous service requirement under Section 25‑F of the Industrial Disputes Act, 1947.
Legislation cited
- Industrial Disputes Act, 1947s. 258(2), s. 25-B, s. 25-F, s. 2A
Subjects
Industrial Disputes Actcontinuous serviceSection 25-Fterminationcasual employeedistinct establishmentsreinstatementback wages
Judgment
[2009] 11 S.C.R. 626
A HARYANA STATE CO-OPERATIVE SUPPLY MARKETING
FEDERATION LIMITED
V.
SANJAY
(Civil Appeal No. 4605 of 2009)
B JULY 22, 2009
[TARUN CHATIERJEE AND R.M. LODHA, JJ.) ...
_
;,
lndlljstrial Disputes Act, 1947 - s. 25-F r/w s.25-8 -
C Termination - Challenge to - Respondent-workman
contended that he had completed more than 240 days of
continuous service and yet mandatory procedure provided in
s.25F was not followed - Respondent was engaged in two
different establishments of an institution under two different
D contracts - While computing 240 days of continuous service,
he clubbed the period of engagement with the said two
establishments - Justification of - Held: Not justified - On
facts, the two establishments were distinct and separate and
could not be treated' as one establishment for reckoning
E continuity of service within meaning of s.25-F rlw s.25-8 -
Concept of continuous service under one employer was not
applicable - Respondent having not completed 240 days of
continuous service in the year preceding his termination, s.25-
F was not at all attracted - In the circumstances, order of
F reinstatement passed by Courts below set aside.
Respondent-workman had been engaged on
. contractual basis by the District Manager, HAFED, Jind
for 145 days and again by the District Manager, HAFED,
Hissar for 112 days. He raised industrial dispute
G contending that he was illegally terminated from service.
Respondent contended that he had completed more than
240 days of continuous service in the year preceding the
date of termination and yet he was terminated from
service without following the mandatory procedure
H 626
HARYANA STATE CO-OPERATIVE SUPPLY MARKETING 627
FEDERATION LTD v. SANJAY
provided in s.25F of the Industrial Disputes Act, 1947. A
While computing 240 days of continuous service, the
respondent clubbed the period of his engagement with
District Manager, HAFED,. Jind and District Manager,
HAFED, Hissar.
B
The Industrial Tribunal-cum-Labour Court ordered
reinstatement of respondent with continuity of service
,.
.. and payment of 50% back wages. The order was upheld
by the High Court. Hence the present appeal.
Allowing the appeal, the Court c
HELD: 1.1. For the purposes of applicability of
Section 25-F of the Industrial Disputes Act, 1947, the
workman has to show that he has been in continuous
service for not less than one year under an employer. A D
> workman is deemed to be in continuous service for a
period of one year if during the period of 12 calendar
months preceding the date of termination, he has actually
worked under the employer for not less than 240 days by
virtue of Section 258(2) of the ID Act. The words "has
E
been in continuous service .......... under an employer" in
Section 25-F are crucial. [Para 8] [631-F-H]
1.2. The office of the District Manager, HAFED, Jind
and the office of the District Manager, HAFED, Hissar are
"' two distinct c:md separate establishments and cannot be F
treated as one establishment for the purpose of
reckoning continuity of service within the meaning of
Section 25-F read with Section 25-B of the ID Act. It is so
because the workman was engaged on contract basis by
two separate authorities under different contracts. The G
contract of employment with District Manager, HAFED,
..-~"
Jind commenced on August 1, 1998 and continued upto
December 31, 1998. The contract _with District Manager,
HAFED, Hissar, January 15, 1999 was a separate
H
628 SUPREME COURT REPORTS [2009] 11 S.C.R.
A contract. Both authorities are distinct. It is true that the
office of District Manager, Jind and the office of District
Manager, Hissar are the establishments or offices of the
HAFED but t~e authority that engaged the workman as
Chowkidar on casual basis at Jind is different from the
8 authority that engaged him at Hissar. It is not unusual for
an Institution, Corporation or Authority to have different
offices, branches and establishments. When a casual
employee is employed in different establishments of a >
Corporation, Institution or Authority, the concept of
c continuous service under one employer cannot be
applied. [Para 8] [631-H; 632-A-E]
1.3. Merely because the District Manager, Jind and
the District Manager, Hissar are the subordinate officers
under the control of Managing Director, HAFED, the two
D offices at Jind and Hissar do not cease to be separate
establishment for the purposes of Section 25-F of the ID
Act. When a casual employee is employed in different
establishments, may be under the same employer, the
concept of continuous service cannot be applied. There
E is also no merit in the contention raised by the
respondent that the workman was transferred from the
office of the District Manager, Jind to the Office of District
Manager, Hissar. No transfer order was placed by the
workman before the Labour Court. As a matter of fact, by .
F a separate and fresh contract, the workman was engaged
by the District Manager, Hissar from January 15, 1999.
The employment of the workman at Hissar was not an
employment in continuity but a fresh employment. [Para
12] [634-H; 635-A-D]
G
1.4. The office of the District Manager, Hissar are
~~
separate and distinct and the services rendered by the
workman at these two establishments cannot be clubbed
for the purpose of reckoning continuity of service within
H
HARYANA STATE CO-OPERATIVE SUPPLY MARKETING 629
' FEDERATION LTD v. SANJAY
).~
the meaning of Section 25-F read with Section 25-B of the A
ID Act. The workman having not completed 240 days of
continuous service under the employer in the year
preceding his termination, Section 25-F is not at all
attracted. In the circumstances, the Judgment passed by
the High Court and the award passed by the Labour Court B
are quashed and set aside. [Paras 13 and 14] [635-E-G]
, .. Union of India v. Jummasha Diwan (2006) 5· SCC 544;
.I:
Management of Indian Cable Co. Ltd, v. Workmen (1962)
Supp 3 SCR 589; DGM Oil & Natural Gas Corporation Ltd.
& Anr. v. /lias Abdul Rehman (2005) 2 SCC 183 and Haryana
c
Urban Development Authority v. Om Pal (2007) 5 SCC 742,
relied on.
Case Law Reference:
D
-'!- (2006) 8 sec 544 relied on· Para 8
(1962) Supp 3 SCR 589 relied on Para 9
(2005) 2 sec 183 relied on Para 10
(2007) 5 sec 742 relied on Para 11 E
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
4605 of 2009.
From the Judgment & Order dated 7.5.2007 of the High
"' Court of Punjab & Haryana at Chandigarh in CWP No. 9985 F
of 2006.
•
Prashant Kumar, Gautam Awasthi, D. Mahesh Babu for the
Appellant.
G
Dr. Ramesh K. Haritash, Dr. Kailash Chand for the
.•. J- Respondent.
The Judgment of the Court was delivered by
H
630 SUPREME COURT REPORTS [2009] 11 S.C.R.
•
A R.M. LODHA, J. 1. Leave granted.
2. This appeal by special leave is directed against the
judgment of the High Court of Punjab and Haryana whereby
Division Bench of that Court upheld the award passed by the
Industrial Tribunal-Cum-Labour Court, Hissar ordering
8
reinstatement of the respondent-workman with continuity of
service and payment of 50% back wages.
3. Sanjay, respondent, was engaged as Chowkidar on
causal basis by the District Manager, HAFED, Jind on August,
C 1998 for 29 days. On expiry of the said contract, fresh contracts
were executed from time to time and he rendered service there
until December 31, 1998. He was engaged afresh by the
District Manager, HAFED, Hissar on January 15, 1999 where
he worked upto May 31, 1999. As the service of the respondent
D was not renewed after May 31, 1999, he issued demand notice
under Section 2A of the Industrial Disputes Act, 1947 (for short
"ID Act") raising dispute to the effect that his services were
illegally terminated. Conciliation efforts having failed, upon
receipt of the failure report, the appropriate Government
E referred the dispute for adjudication to the concerned Labour
Court.
4. The respondent in his statement of claim before the
Labour Court set up the case that he had completed more than
F 240 days of continuous service in the year preceding the date
of termination with the HAFED. He raised the grievance that
without following the mandatory procedure provided in Section
25-F of the lD Act, his services were terminated which
amounted to illegal retrenchment. It is pertinent to notice here
that the respondent clubbed the period of his engagement with
G District Manager, HAFED, Jind and District Manager, HAFED,
Hissar while computing 240 days of continuous service.
5. The Appellant-Management traversed the workman's
claim and set up the plea that the workman was engaged on
H contractual basis by the District Manager. HAFED, Jind for the
HARYANASTATE CO-OPERATIVE SUPPLY MARKETING 631
FEDERATION LTD v. SANJAY[R.M. LODHA, J.]
,l period from August 1, 1998 to December 31, 1998 and there A
he completed 145 days of service. The District Manager,
HAFED, Hissar, which is a separate industrial establishment,
engaged the workman afresh on January 15, 1999 upto May
31, 1999 and accordingly, workman worked in the office of
District Manager, HAFED, Hissar for 112 days. The B
Management, thus, set up a specific case that the workman
worked at two different units of HAFED and the period· of
service rendered at these two places cannot be clubbed for.the
.... purposes of Section 25-F of the. ID Act. The case of the
~-
Management was that the workman having not completed 240 c
days of continuous service, there was no necessity of
compliance of Section 25-F of the ID Act.
6. Both the parties led evidence in support of their
respective case. The Industrial Tribunal-Cum-Labour Court,
Hissar held that there was violation of Section 25-F of the ID D
Act and, therefore, termination of service of the workman was
bad in law. It directed reinstatement of the workman with 50%
back wages. The said award has been affirmed by the High
Court.
E
7. The question that falls for our consideration is: whether
the work rendered by the rE;lspondent in the office of District
Manager. HAFED, Jind and the District Manager, HAFED,
Hissar can be clubbed together for the purposes of application
of Section 25-F of the ID Act. F
'r
8. For the purposes of applicability of Section 25-F, the
workman has to show lhat he has been in continuous service
for not less than one year under an employer. A workman is
deemed to be in continuous service for a period of one year if
during the period of 12 calendar months preceding the date of G
termination, he has actually worked under the employer for not
....-.)- less than 240 days by virtue of Section 258(2) of the ID Act.
The words "has been in continuous service .......... under an
employer" in Section 25-F are crucial. Can office of the District
Manager, HAFED, Jind and office of the District Manager, H
632 SUPREME COURT REPORTS [2009] 11 S.C.R.
A HAFED, Hissar, for the purposes of Section 25-F, be said to
be one establishment and, thus, covered by an expression
"under an employer"? We do not think so. In our view, the office
of the District Manager, HAFED, Jind and the office of the
District Manager, HAFED, Hissar are two distinct and separate
B establishments and cannot be treated as one establishment for
the purpose of reckoning continuity of service within the
meaning of Section 25-F read with Section 25-B of the ID Act.
It is so because the workman was engaged on contract basis
by two separate authorities under different contracts. The
...
1-
C contract of employment with District Manager, HAFED, Jind
commenced on August 1, 1998 initially for 29 days and
continued upto December 31, 1998. The contract with District
Manager, HAFED, Hissar, January 15, 1999 was a separate
contract. Both authorities are distinct. It is true that the office of
D District Manager, Jind and the office of District Manager, Hissar
are the establishments or offices of the HAFED but the authority
that engaged the workman as Chowkidar on casual basis at
Jind is different from the authority that engaged him at Hissar.
It is not unusual for an Institution, Corporation or Authority to
have different offices, branches and establishments. When a
E casual employee is employed in different establishments of a
Corporation, Institution or Authority, the concept of continuous
service under one employer cannot be applied. In the case of
Union of India v. Jummasha Diwan1, this Court observed,
"there are several establishments of Railway Administration. If
F a workman voluntarily gives up his job in one of the
establishments 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. Railway Administration of India as a whole,
G having different administrative set ups, different requirements
and different projects, the concept of continuous service cannot
be applied ............ "
H 1. (2006) s sec 544.
HARYANA STATE CO-OPERATIVE SUPPLY MARKETING 633
FEDERATION LTO v. SANJAY [R.M. LODHA, J.]
J:• 9. The Constitution Bench of this Court in the case of A
· Management of Indian Cable Co. Ltd, v. Workmen 2 dealt with
the exprE;!ssion "industrial establishment" albeit with reference
to Section 25-G of the ID Act and held :
"Thus whether we have regard to the popular sense of the
B
words "industrial establishment", or to the limitation of relief
under Section 25-G to workmen in the same category, the
conclusion would appear to be inescapable that each
~·
branch of a company should normally be regarded as a
~
distinct industrial establishment."
c
10. In the case of DGM Oil & Natural Gas Corporation Ltd.
& Anr. v. llias Abdul Refiman3 , this Court was concerned with
the question whether work put in by the workman in different
units, namely, Baroda and Mehsana.projects of Oil and Natural
Gas Corporation could be counted for determining whether the D
workman worked for 240 days continuously for the purpose of
'Section 25-F of the ID. Act. The Court answered the question
in the negative and held that the Baroda and Mehsana projects
of the Corporation could not be considered as a single unit or
department under the Corporation and, therefore, the days put E
in by the workman in different units could not be counted for
determining whether the workman worked for 240 days
continuously for the purpose of Section 25-F of the ID Act, This
is what this Court said:
't "We are aware that the judgment of this Court in Indian F
Cable Co. Ltd. was rendered in the context of Section 25-
G of the Act, still we are of the opinion that the law for the
purpose of counting the days of work in different
·departments controlled by an apex corporation will be
governed by the principles laid down in the judgment of G
Indian Cable Co. Ltd. And the Industrial Tribunal was
,.-J.- justified in dismissing the reference."
2. 1962 Supp (3) SCR 589.
3. (2005) 2 sec 183. H
634 SUPREME COURT REPORTS [2009] 11 S.C.R.
A 11. In Haryana Urban Development Authority v. Om Pa/4, .....
the question raised before this Court was whether the two Sub-
Divisions of Haryana Urban Development Authority could be
treated to be one establishment for the purpose of reckoning
continuity of service within the meaning of Section 25-8 of the
8 Act. This Court held :
"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 •
c meaning of Section 25-8 of the Act, as was held by the
Tribunal, a person working at different points 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
D 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 25-F of the Act. Thus, once two establishments
E are held to be separate and distinct 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
F when he was not transferred from one sub-division to the
1
other. In this case he was appointed merely on daily
wages."
12. Learned counsel for the respondent, however,
strenuously urged that the Managing Director, HAFAED has
G
control over the office of District Manager, Jind as well as
District Manager, Hissar and, therefore, workman can be said
to have worked under the same employer. We are unable to
accept the contention of the learned counsel. Merely because
. ..,
4. (2007) s sec 742.
H
HARYANA STATE CO-OPERATIVE SUPPLY MARKETING 635
FEDERATION LTD v. SANJAY [R.M. LODHA, J.]
'I
' J: the District Manager, Jind and the District Manager, Hissar are A
the subordinate officers under the control of Managing Director,
HAFED, the two offices at Jind and Hissar do not cease to be
separate establishment for the purposes of Section 25-F of the
ID Act. As held by this Court in Jummasha Diwan, with which
we respectfully agree, that when a casual employee is B
employed in different establishments, may be under the same
employer, the concept of continuous service cannot be applied.
...) There is also no merit in the submission of the learned counsel
for the respondent that the workman was transferred from the
office of the District Manager, Jind to the Office of District c
Manager, Hissar. No transfer order was placed by the workman
before the Labour Court. As a matter of fact, by a separate and
fresh contract, the workman was engaged by the District
Manager, Hissar from January 15, 1999. The employment of
the workman at Hissar was not an employment in continuity but
\ D
a fresh employment.
13. In what we have discussed above, the conclusion would
appear to us to be inescapable that the office of the District
Manager, Jind and the office of the District Manager, Hissar
are separate and distinct and the services rendered by the E
workman at these two establishments cannot be clubbed for the
purpose of reckoning continuity of servic<;i within the meaning
of Section 25-F read with Section 25-8 of the ID Act. The
workman having not completed 240 days of continuous service
~ under the employer in the year preceding his termination, F
Section 25-F is not at all attracted. In the circumstances, the
impugned Judgment cannot be sustained and has to be set
aside.
14. The appeal is, accordingly, allowed. The Judgment
G
dated May 7, 2007 passed by the High Court and the Award
dated February 8, 2006 passed by the Industrial Tribunal-Cum-
,,....)> Labour Court, Hissar are quashed and set aside. The parties
will bear their own costs.
8.8.B. Appeal allowed. H
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