Holding

The termination was retrenchment and, because the employer failed to comply with the conditions of section 25F, the termination was illegal and void, entitling the appellant to reinstatement and back wages.

Summary

L. Robert D'Souza, who had served continuously in Southern Railway since 1948, was transferred as punishment for union activities and later reinstated. In September 1974, while on a fast, he was deemed to have unauthorisedly absent himself and his service was terminated retrospectively from 18‑September 1974. He challenged the termination, arguing that he had acquired the status of a temporary railway servant after more than six months of continuous service and that the termination amounted to retrenchment under the Industrial Disputes Act, 1947, requiring compliance with section 25F. The High Court and a Full Bench dismissed his claim. The Supreme Court held that the expression "termination of service for any reason whatsoever" in the definition of retrenchment covers such termination, that D'Souza was indeed a temporary railway servant, and that the employer failed to give the notice, compensation and government notice mandated by section 25F. Consequently, the termination was illegal and void, the appeal was allowed, the order of the High Court set aside, and D'Souza was reinstated with back wages.

Issues considered

Whether the termination of D'Souza's service for unauthorised absence constitutes retrenchment within the meaning of section 2(oo) and section 25F of the Industrial Disputes Act, 1947.
Whether D'Souza, originally a casual labourer, had acquired the status of a temporary railway servant under Rules 2501 and 2505, thereby attracting the procedural safeguards of section 25F.
Whether section 9A of the Industrial Disputes Act and its proviso dispense with the notice requirement for a valid retrenchment.
Whether the employer complied with the three conditions of section 25F – notice, compensation and government notice.
Whether the termination order is void and the appellant is entitled to reinstatement and back wages.

Legislation cited

Indian Railway Establishment Code (Manual)s. Rule 2301, s. Rule 2302, s. Rule 2501, s. Rule 2505
Industrial Disputes Act, 1947s. 25F, s. 25FF, s. 25FFF, s. 2(oo), s. 9A

Subjects

Industrial Disputes Actretrenchmenttermination of servicetemporary railway servantcasual laboursection 25Fsection 9Arailway employmentunfair labour practiceunion activitiesback wages

Judgment

251

A
L. ROBERT D'SOUZA
v.
THE EXECUTIVE ENGINEER SOUTHERN
RAILWAY & ANR .
•
February 16, 1982
8

(D.A. DESAI AND R.B. MISRA, JJ.]

Industrial Disputes Act, 1947 1 sections 2(oo) and 25F, scope of-"Terml-
nation of se~vice for any reason whatsoever'' in the definition "retrench.ient"·
::-,>-···. darified. G
Construction of Section_ 9A-Casuaf labour, termination of services Qf-
Railway Establishme1u Code, Rules 2501 and 2505, explained.

The appellant joined service as a gangm1-n in Southern Railway on July
1, 1948. In course of his service be was transferred to varioui places. While
he wa:s working as a Lascar at Ernakulam, he was transferred, some time in D
March 1970 by way of punishment for his Union activities in the capacity of
_General Secretary of the Southern Railway Construction Workers Union,
Eroakulam, to Podannur in Tamil Nadu. However, bis transfer was cancelled
and he joined duty on· 20-2-1971 at Ernakulam. The Ministry of Labour,
Government of India, by its letter dated April 23, 1974 directed treatment of his
entire period of absence from 8tb March, 1970 to 19th February, 1971 as duty.
Later, the appellant approached the Labour Court for recovering some of his dues ll
which remained pending fo[ a long time. As the appellctnt and thoie similarly
situated were likely to reach the age of superannuation and by the unfair labour
practice, namely, treating them only as 'daily rated labour', of the Railway
Administration, they were likely ~o be denied the full retirement benefits,
appellant and several others filed a writ petition in the High Court of Kerala,
praying for a direction that they should be treated at least as temporary railway
servant with attendant benefits. During the pendency of the matter, in connec- F
tion, with the demand for a 11 the benefits granted by the Central Pay Commission
being extended to the category of employees t-0 which the appellant belonged the
appellant undertook a fast. but-broke the rsame on September 28, 1974 at the
intervention of [the Assistant Labour Commissioner. Taking advantage of the
appellant's absence, the .respondents termina.ted his service with retrospective
effect, i.e., from 18~9-1974 on the gronnd of unauthorised absence. A learned
single Judge having dismissed the liame, the Jmatter was taken. in appeal before G
the Division Bench. In the appe1l, it was coaten,ded that the terminatioti of
service of the appellant in the circumstances wo.uld constitute retrenchment
within the meaning. of section 2SF of the Industrial Disputes Act, 1947 and,
therefore:, the order ()f termination was invalid. , The matter was referred to the
Full Bench which held that there ,was no retrencbme 0t and cjismi$$ed the appeal:
Hence, the appeal by special leave. H
Allowing the appeal, the Gou.rt,
252 SUPREME COURT REPORTS [1982) 3 s.CR.

A HELD : 1. The expression "termination of service for any reason
whatsoever" in the definition "retrenchm~nt" in section 2(oo) of the Industrial
Disputes Act, 1947 covers every kind of termination of service except those not
expressly included in section 25F or not expressly provided ior by other pro·
visions of the Act such as sections 25FF and 25FFF. The excepted categories
are (i) termination by way ·-or punishment inflicted pursuant to disciplinary
action; (ii) voluntary retirement of the workman; (iii) retirement of the workman
I! on reaching the age of superannuation if the contract of emplo}·ment between
the employer and the workman concerned contains a _-stipulation in that behalf;
(iv) or termination of the services on the ground of continued ill·health. _Once the
case does npt fall in any of the excepted categories, the termination of service
even if it be according to automatic discharge from service under agreement
would nonetheless be retrenchment within the meaning of ·expression in -section
2(oo) of the Act. It must as a corollary follow that if the name of the
c workman is struck off the roll, that itself would constitute retrenchment. -
[259 B-C, 206 H, 261 A-B]

. Delhi Cloth & General Mills Ltd. v. Shambhu Nath Mukherji, [1978] I ,_
1
SCR 591, followed •.

State Bank of India v. N. Sundera Money, [1976] 3 S.C. R. 160; Hindustan
D Steel Ltd. v. Presiding Officer, Labour Court, [1977] 1 S.C.R. 586; Santosh Gupta
v, State Bank of Patia/a, [1980] 2 S.C.R 884 at 892; Mohan Lal v. Bharat
Electronics Ltd., [1981] 3 S.C.C. 225, referred to.

1:2. There is neither apparent nor real conflict between the decision
of the constitution· bench in Hariprasad Shivshanker Shukla v. A..D. Divikar,
[1957] S.C.R. 121 and the later five decisions commencing from Sundera
E Money and ending with Mohan/al' s case. Re~ex:amining a contention over again
so as to cover the familiar ground would, apart from giving a go bye to _the
doctrine of stare decisis, would be a sheer waste of time and mere lengthening
of the judgment. [260 C'D]

Surendra Kumar Verma & Ors, v. Central Gover:nment Industrial-cum-
·Labour Court, New Delhi & Anr., [1981] 4 S.C.C. 443, View of Pathak, J. held
F inapplicable.]

2:1. Notice contemplated by clause (a) of section 25F would not be
dispensed with, in.view of the provision contained in proviso (b) of section 9A,
which is ~n independent provision having no co-relation with section 25F.
[264 BJ

G 2:2. Section 9A imposes an otligation on the employer, who pro~·. ses
to effect ·any change in the conditions of service applicable to any workman in
respect of any matter specified in the F_ourth Schedule to give notice as therein
provided and the employer is precluded from effecting the change without giving
·to the workman likely to be effected by such change, notice in the prescribed
manner of the nature of the change proposed to be effected, and the change can-
not be effected within 21 days of the giving of such notice. In order to attract
.section 9A tbc; 1.;pange propose<;l must be.in tbe conditions of service applicable to
I

L.R. D'SOUZA V. EX ENG., S; RAILWAY 253

the workman in respect of any matters specified in. the Fourth Schedule. If the A
proposed.change falls in any of the matters specified in the Fourth Schedule the
change· can be effected after giving notice in the prescribed manner and waiting
for 21 days affer giving such notice. In order to attract section 9A the employer
must be desirous of effecting a change in conditions of service in respect of any
matter specified in Fourth Schedule. If the change proposed does not cover any
matter in Fourth Schedale section 9A is not attracted and no notice is necessary.
[262 E-0]

Workmen of Sur Iron & Steel Co. (P) Ltd. v. Sur Iron & Steel Comppny
(P) Ltd., [1971] LLJ 570; Tata Iron & Sttel Company Ltd. v. Workmen, [1973] I
SCR 594; Assam Mot~h Co. Ltd. v. Bijoy Loi Sen, [1974] l SCR ll6, referred
to.
~··
2:3. Retrenchment to be valid must comply with three conditions set c
out in section 25F. They are, (a) subject to the proviSo to clause (a) one month's
notice in writing specifyin.g the reasons for retrenchment or wages in lieu of
notice: (b) compensation to l:!'e paid according to the measure provided in the
clause, the payment to be simultaneous with the retrenchment; and (c) the
notice in the prescribed manner to be served on the appropriate Government.
It was obligatory upon the employer, who wants to l'retrench the workmen to
give notice as contemplated by clause (a) of section 25. [262 C-E] D
2:4. A careful reading of sections 9A and 25F makes it clear
that when a workman is retrenched, no change in his conditions of
service is effected. No item in Fourth Schedule which sets out the· conditions of
service covers the case of retrenchment. In fact retrenchtnent is specifica1ly
covered by item IO of the Third Schedule. If retrenchment which connotes
termination of service, cannot constitute change in conditions of service in
E
respect of any item mentioned in Fourth Schedule saction 9A would not be
attracted. If section 9A is not attracted, the question of seeking exemption from
it in the case falling under the ,_proviso would hardly arise. Ther~fore, neither
seciion 9A nor the proviso is attracted •in this case. That apart, none of the
other pre-conditions to a valid retrenchment have been tomplied with, because
the very letter of termination of service shows that services were deemed to have
been termitiated from a back date which clearly indicates no~notice being given~
F
no compensation being paid and no no~ice being given to. the prescribed authority.
Therefore, termination of strvice, being retrenchment, for failttre to comply with
section 25F, would be void ob initio. [263 D-11, H, 264 A, C-DJ

.. 3:1: The test provided is that for the putpose of determining the eligi-
,bih~ of casual labour to be treated as temporary, the criterion shoo Id be the
penod of continuous work put in by each individuai labour on . the same type
G
of work and not the period put in collectively by any particular gang or group
of labourers. It is thus abundantly clea; that if a person belonging to the
category of casual labour employed in construction work other than work-
charge~ projects renders six months' contiriuous service without a break, by the
operation of statutory rule the nerson would be treated as temporary railway H
servant after the expiry of six months of continuous ..employment. It is equally
true of even seasonal labour. Qnce the pe~on acquir~d the statua·_of tem~orar¥
SUPREME COURT REPORTS fl982] 3 s.c.R.
254
railway servant by operatlon of ;law, the conditions of his service wout~ be
A governed as set out in Chapter XXIII. The ser~ice of a temporary railway
servant may be termined only as provided in Rule 2301. [266 H, 267 A-B, El

3:2. The underlying intendment of the Rule 2501(~) (i) & (ii~) and note
below Rule 2505 is that a casual labour who bas rendered six months conqnuous
service would-be-placed in the categ'ory of temporary ra.ilway servant ~nless he
is employed on work-charged project. Rule 250l(b) (1) clearly. provides that
B even where staff is paid from contingencies, they would acquire !he st~tus of
temporary railway servants after expiry of six months of continuous
employment. [271 E-H] •

In the instant case : (i) tbe appellant acquired the status of ten1porary
railway servant Jong before the termination Of his service and, therefore, his
c service could not have been terminated under Rule 2505; (ii) he nevet worked on
projects but on a construction Unit. Construction Unit is a regular Unit anti
cannot be equated to Project. Every construction work does not imply Project.
Project is correlated to planned projects in wli.ich the workman is treated as
work-Charged. Persons belonging to casual Jabour category cannot be trans-
ferred but the appellant was transferred ·on innumerable occassions; (iii) as a
result of the appellant and others filing a writ petition, three co-appellants were
D informed that they were treated as on regular employments and ceased to belong
to the category of casual labour. But for impugned termination orders the
appellant also would have been treated as temporary and therefore1 the iappellant
received discriminatory treatment offending Article 14 & 16 of the Constitution;
and (iv) section 25F of the Industrial Disputes- Act provides that no workman
employed in any industry who has been in continuous service for not less than
one year under an employer shall be retrenched by that employer until the con-
E ditions set out in Act are satisfied. The appellant would be a workman within
the meaning of that ex:pression in section 2(s) of the Act. 'He has rendered con-
tinuous service for a period over twenty years. Therefore, the first condition of
section 25F that appe11ant is a workman who has rendered service for not Jess
than one year under the Railway administration, an employer carrying on an
industry, is satisfied. His service is terminated which for the reasons herein-
before given would .co~stitute ~etrenchment. It is immaterial that he. is a daily
F 1'ated worker. He ts either doing manual or technical work and hiS salary was
Jess than Rs. 500 and the termination of his service does not faJJ ·in any of the
excepte9 categories. The~efore, assuming that he was a daily ra1ed worker
once he has rendered continuous uninterrupted service for a p~riod of one yea;
or more, within the meaning of section 25B of the Act and his service is termi-
nated for any reason whatsoever and. the case doe<; not fall in any of the excepted
categories, notwithstanding the fact that Rule 2505 would be attracted, it would
G have to be read subject to the provisions of the Act. Accordingly the termination
of service in this case would constitute retrenchment and for not complying with
pre-conditions to valid retrenchment the order of termination would be illegal
and invalid. [271 D, 272 A, G, 275 D-G]

H . 3:3. Absence without leave constitutes misconduct and it is' not open to
the employer to terminate service without notice and inquiry or at any rate
wit~out complyiµg with tile minimum principle of natural justice. Further~
LP. D SOUZA v. BX. ENG., s. RAILWAY (Desai, J.)
1
25)

Rule, 2302 clearly prescribes the mode, manner and 'methodology of terminating A
service of a temporary railway servant and admittedly the procedure therein
prescribed having not been carried out, the termination is void and invalid;
Accordingly, the same conclusion would Qe reached even while accepting for the
purpose of the facts of this case simultaneously rejecting it in· law that the
termination does not constitute retrenchment yet nonetheless it would be void
and inoperative. [273 A-CJ
B
OBSERVATION: Rule 2501 which permits a man serving for 10, 20,
30 years at a stretch without break being treated as daily rated servant, is
thl"¥1ugJily opposed to the notions of socio-economic justice and it is high time
that Railway administration brings this part of the provision of the Manual,
antequarian and antidiluvian, in conformity with the Directive Principles of State
Policy as enunciated in Part IV of the Constitution. ·It is high time that these
utterly unf~ir (provisions wholly den:Ying socio-economic juStice are properly c'
modified and brought in conformity with the modern concepi of justice and
faieplay to the lowest and the lowliest in Railway administration.
[273 C-D, 274 A-BJ

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1613
of 1979.

Appeal by special leave from the Judgment and Order dated
the 9th January, 1979 _of the Kerala High Court in O.P. No. 4401
of 1974.

K.R.R. Pillai for the Appellant.
E
P.A. Francis and Miss A. Subhashini for the Respondents.

The Judgment of the Court was delivered by

DESAI, J. Appellant L. Robert D'Souza joined service as a
gangman at Mangalapuram in. Southern Railway on July !, 1948. F
In course of his service he was transferred to various places. When
he was last working as Lascar at Ernakulam, on October 8, 1974
the Executive Engineer (Construction), Erna:kulam intimated to him
.'
-~
' that his services were deemed to have been terminated from
September 18, 1974, from which date the appellant was _said to have
absented himself from duty. This letter has an important bearing G
on the issues raised in this appeal, and, therefore, relevant portion
may be extracted here :

"You have absented yourself unauthorisedly from
18.9.1974 and hence your se1vices are deemed to have H
been terminated from the day you have absented yourself.
Please note.
\
/
256 SUPREME COURT REPORTS {1982] 3 s.c.R.

A Since you are no longer on the rolls of this office yoa
should vacate the quarters allotted to you i rnmediately
failing which action will be taken to evict you".

According to the appellant, up to the date of unauthorised and
illegal termination of his service he had rendered coiitinuou• service
B for a period of 26 years yet the Railway administration wrongfully
denied him the status of a temporary and/or regular workman and
treated him a daily rated casual labourer. This treatment according
to the appellant was so unfair that it prompted persons who were
victims of this unfair treatment by the Railway administration to
form a Union named Southern Railway Construction Workers
c Union, Ernakulam, of which the appellant was the General
Secretary. The Union submitted a charter of demands which
presumably irritated the authorities and chagrined by it, the
appellant was transferred to Podannur in Tamil Nadu by way of
punishment. As the late Shri A.K. Gopalan, who was a renowned
trade union leader, espoused the cause of the appellant, his transfer
D
was cancelled and he was reposted and allowed to continue at
Ernakulam after paying the arrears of wages and granting continuity
of service for the period he did not join duty at the place of his
transfer. This is quite evident from the Jetter of the Under Secretary,
Ministry of Labour, dated April 23, 1974, which reads as under :
l!l
"With reference to your letter dated the 28th May,
1973, on the above subject, I am directed to say that it has
been reported by the Ministry of Railways that the
Southern Railway Administration bas been advised that as
you were transferred back to Ernaku!am on 19th March,
F 1971, you should be deemed to have been on duty for the
intervening period from 8th March', 1970 to 19th February,
1971, and your wages paid accordingly".

The local superiors of the appellant were annoyed by the
success of the appellant and they were on a look out for settling the
G score with the appellant. In the meantime the appellant approached
the Labour Court for rocovering some of his dues which remained
pending for a long time. As the appellant and those similarly
'ituated were likely to reach the age of suptrannuation and by the
unfair labour practice of the Railway administration they were likely
H to be denied the full retirement benefits, appellant and several
others filed a writ petition in the High Court of Kerala .. According
i..R. D;SOUZA v. EX. ENO., s. RAILWAY (Desai, J.) 257

to the appellant, for the various reawns stated in the petition,
A
appellant and those similarly situated could not be treated as daily
rated casual labour and under the relevant rules appellant and his
co-workers would at least acquire the status of temporary railway
servants and their services could not be terminated in the manner
in which the appellant's service was terminated and that they woul.I
B
be entitled to all the retiral benefits. The petition came up before
a learned single judge who dismissed the same. The matter was
taken in appeal before the Division Bench. In the appeal it was
contended that the termination of service of the appellant in the
circumstances as set out earlier would constitute retrenchment within
the meaning of section 25F of the Industrial Disputes Act, 1947
('Act' for short), and therefore, the order of termination, Inter a/ia,
c
is invalid The Division Bench found the question raised before it
of such importance and magnitude that it referred the same to the
Full Bench.

In the meantime the appellant was actively pursuing his trade
D
union activities. A demand was made that all the benefits granted
by the Central Pay Commission be extended to the category of
employees to which the appellant belonged and when these demands
fell on deaf ears, it was resolved to give a strike notice. The matter
was taken in conciliation which ultimately resulted ·in failure. The
appellant approached the Ceritql Government to make a reference E
under s. IO of the Act in respect of the demands for adjudication by
National Tribunal. As the Central Government was wobbling in
its approach, the appellant declared his intention to go on fast unto
death for redressal of the grievances suffered for decades by the
lowest category of railway employees. At that stage the Assistant
Labour Commfssioner intervened and persuaded the appellant not F
to precipitate the matter. The appellant accordingly broke his fast
on Sepetember 28, 1974, in the hospital where he was confined
during his fast. Taking advantage of his absence during the fast
immediately the order of termination of his service was served and
this led to the present proceedings which ha¥e culminated in this
appeal. G
The appellant, inter alia, contended before the Full Bench of
Kerala High Court that the termination of his service for the reasons
and in the manner brought about is illegal and invalid, that it was
victimisation for trade union activities; that it was unfair labour H
practice and that it was ma/a fide. It was also contended that in
view of his long uninterrupted s~rvice admittedly over twenty years
SUPREME COURT REPORTS (1982) 3 s.c.a.
...,_
A he was at the minimum a temporary railway servant and, therefore, '
his service cannot be terminated unless he was rendered surplus or
by way of disciplinary measure after complying with Article 311 of
the Crnstitution. The, legal submission put in the forefront was that
in the circumstances herein mentioned the termination of service
.
constituted 'retrenchment' within the meaning of s. 25F of the· Act
and as the pre-condition to valid retrenchment having not been
satisfied, the termination is illegal and invalid. The Full Bench
answered the point referred to it against the appellant holding that
there is no retrenchment as contended for, on behalf of the appellant
and finally dismissed the petition. Hence this appeal by special leave.

·C
At the outset it must at once be pointed out that the construc-
tion· put by the Full Bench of the Kerala High Court on the
expresssion 'retrenchment' in s. 2(oo) of the Act that it means only
the discharge of surplus labour or staff by the employer for any
reason whatsoever is no more good law and in fact the decision of
D the Full Bench of Kerala High Court in L. Robert D' Souza v.
Executive Engineer, Southern Railway and Anr.,(') has been speci·
fica]ly overruled by this Court in Santosh Gupta v. Stare Bank of
Patia/a.(2 ) This Court has consistently held in State Bank 'of India
v. N. Sundera Money,( 3) Hindustan Steel Ltd. v. Presiding Officer,
Labour Court,(') and Delhi Cloth & General Mills Ltd. v. Shambhu
E
Nath Mukherji,( 5) that the expression 'termination of service for irny
reason whatsoever' now covers every kind of termination of service
except those not expressly included in s. 25F or not expressly

-
provided for by other provisions of th.e Act such as ss. 25FF and
25FFF. It was attempted to be urged that in view of the decision .
F of this Court in Pipraich Sugar Mills Ltd. v. Pipraich Sugar Mills
Mazdoor Union,( 6) the ratio of which was re-affirmed by_ a Consti- ~
tution Bench of this Court in Hariprasad Shivshanker Shukla v.
A.D. Divikar,(') all the later decisions run counter to the Constitu-
tion Bench and must be treated per in curium. This contention
need not detain us because first in Hindustan Steel Ltd. case, then
'

(I) [1979] llLLJ. 2111.
(2) (1980] 2 S.C.R. 884]at 892
(3) [1976] 3 S.C.R. 160.
(4) (1971] 1 S.C.R. 586.
H (5) (1978] I S.C.R. 591.
<6l [1956J s.c.R. sn.
(7) [1957) s.c.R. 121.
t.R. D'SOUZA v. BX. BNG., s. RAILWAY (Desai, J.)1 2S9
in Santosh Gupta's case (Supra) and lastly In Mohan Lal v. Bharat ·A
Eleotronics Ltd.,(') it was in terms held that the decision in Sundera
Money's case was ·not at all inconsistent with the decision of the
Con$titution Bench in Harip1asad Shukla's case and not only
required no reconsideration but the decision in Sundera Money's
case was approved in the aforementioned three cases. This position
is furtl]er butressed by the decision in Delhi Cloth and General Mills B
Ltd . .case wherein striking off th' name of a workman from the roll
was held to be retrenchment. It ls, therefore, the settled law that
! the expression 'termination of service for any reason whatsoever'
~ in the·, definition of the expression 'retrenchment' in s. 2(oo) of the
Act covers every kind of termination of service oxcept those not
expres~ly included in s. 25F or not es:pressly provided for by other c
provisions of the Act. such as ss. 25FF and 25FFF. Two things
thus emerge, firstly, that the decision of the Full Bench of Kerala
High Court under appeal has been specitlcally overruled by this
Court in Santosh Gupta's case (Supra) and secondly, in view of the
decision in Delhi Cloth General Mills Ltd. case (Supra) striking
off the',, name of a workman from the rolls without anything more D
constitutes retrenchment within the meaning of the expression
'retrenchment' ins. 2(00). This emerging legal position alone would
be sufficient for us to allow the appeal and set aside the decision of
the Kerala High Court.

Sh~et anchor of Mr. Francis's submission is that this Court E
should proceed on the construction of expression 'ratrenchment' as
set out i1' Hariprasad Shukla's case, and ignore the construction of
the expr~ssion 'retrenchment' put in ,the decisions of this Court in
Sundera Money's Hindustan Steel Ltd. ca.se, Santosh Gupta's case,
Delhi C/qt~ & . General Mills Ltd. case as being per in curium.
F
We are not disposed to undertake this recurring futile exercise for
obvious r~ason that. on four different occasions, in Hindustan Steel
Limited <i!ise, a Division Bench of this Court consistin.g of
Chandrac~ud, Goswami and Gupta, JJ. in Sundera Money's case, a
Bench con~isting of Chandrachud, Krishna Iyer and Gupta, JJ.; in ·
Santosh G~pta' s case, a Bench consiiting of Krishna Iyer and G
O. Chinnappa Reddy, JJ. and a Bench of two judges consisting of
Gupta, J. and one of us in Mohanlal's case, have repeatedly under-
taken this very detailed exercise and held that there is no inco~sis
tency of any nature and kind nor any conflict, contradiction or
repugnancy · between the decision of the Constitution Bench in H
Hariprasad fihukla's case and aforementioned later four dacisions
(I) [1981} 3 s.c.c. 225.
260 SUPREME COURT REPORTS [1982} j S.C.R.

A and they stand in harmony with each other and the later decisions
take note of an amendment in the relevant provisions of Indus-
trial Disputes Act and, therefore, the c0nstruction put on the
expression 'retrenchment' in the aforementioned decisions pronounced
the settled view of this Court. We, therefore, consider it futile and
waste of precious time of the Court to re-examine the submission of
8 Mr. Francis negatived on four different occasions in the past.
Undoubtedly, Mr. Francis pointed out that in Surendra - Kumar
-Verma & Ors. v. Central Government Industrial Tribunal-cum, Labour
Court, New Delhi & Anr., (1 ) Pathak, J. in his concurring judgment
has stated that his concurrence with the majority view propounded
by Reddy, J. should not be taken to imply his agreement with the
c interpretation of s. 2(oo) rendered in Santosh Gupta's case It may,
however, be mentioned that the majority in that case has affirmed
the earlier decision. Therefore, after meticulously examining on five
distinct and different occasions, it is clearly and unequivocally stated
• that there is neither apparent nor real conflict between the decision
of the Constitution Bench in Hariprasad Shukla's case and the later
D five decisions commencing from Sundera Money and ending with
Mohama/' s case, it would be sheer waste ot'time and merely adding
to the length of the judgment to re-examine this contention over
again, so as to cover the familiar ground.

As we are not prepared to examine the contention over again,
E the submission of Mr. Francis that 'retrenchment' contemplates
some overt act or.. the part of the employer, that it inheres the
principle of last come first go which again requires an overt act on
the part of the employer; that when retrenched workmen are re-
quired to be re-employed, first option for re-employment has to be
given to the retrenched workmen, which necessitates- some overt act
F on the part of the employer, would be beside the point and of no
relevance and significance. The reference to Rules 76, 77-and 78
of the Industrial Disputes (Central Rules). 1957, docs not advance
his case a step further. The definition of expression 'retrenchment'
ins. 2(oo) is so clear and unambiguous that no external aids are
necessary for its proper construction. Therefore, we adopt as bind-
G ing the well settled position in law that if termination of service of
a workman is brought about for any reason whatsoever, it would be
retrenchment except if the case falls within any of the excepted
categories, i.e., (i) termination by way of punishment inflkted pur-
suant to disciplinary action; (ii) voluntary retirement of the work-
H
(I) [1981] 4 S.C.C. 443.
i. R. D'SOUZA v. EX. ENG., s. RAILWAY (Desai, J:) 261
man; (iii) retirement of the workman on reaching the age of super- \
annuation if the contract of employment between the employer and
the workman concerned contains a stipulation in that behalf; (iv) cir
termination of the service on the ground of continued ill-health.
Once the case does not fall in any of the excepted categories the
termination of service even if it be according to automatie discharge
from service under agreement would nonetheless be retrenchment B
within the meaning of expression in s. 2(00). It must as a corollary
follow that if the iiame of the workman is struck off the roll that
itself would constitute retrenchment, as held by this-Court in Delhi
Cloth & General Mills Ltd. case. We specifically refer to. this case
because the facts in the caie before us are on all fours with the facts
in the aforementioned cases and on parity of reasoning and judicial c
comity the same conclusion must follow unless something to the
contrary is indicated. In ,that case respondent S. N. Mukherji who
was recruited as a labourer came to be promoted in course of time
to the post of Motion Setter. On October I, 1964, pursuant to
•
some re-organisation in the establishment the post of Motion Setter
was abolished. The management offered employment to the res- n
pondent S. N. Mukherji on any other suitable post, which was indi-
cated to be the post of Assistant Line Fixer (Assistant Grade I)
without loss of wages. He was to be on probation. The management
found him unsuitable for this post even after extending the period
of probation by 9 months and therefore offered him post of Fitter
on the same pay which he, as a Motion Setter, used t<> get. The E
response of S. N. Mukherji to this offer was that he should be given
a further opportunity to show his efficiency in his job and if he fails
to improve, he would tender his resignation voluntarily. The mana-
gement did ·not reply to the letter with the result that the workman
did not report for work at the newly offered post. On January 19,
1966, the management wrote to the workman that his nllme has been
struck off from the rolls with effect from August 24, 1965, for
continued absence without intimation. Such termination of service
was held to be covered by the expression 'retrenchment' and it was
struck down on the ground that the pre.condition to valid retrench-
ment was not complied with. It would thus appear that it is con-
sistently held by this Court that termination of service for any
G
reason whatsoever except the excepted categories would constitute
retrenchment within the meaning of the expression in the Act. And
here recall the order of termination of service of the appellant
wherein it is stated that "You have absented yourself unauthorisedly
from 19.8.1974 and hence your services are deemed to have been
terminated from the day you have absented yourself." Is any other
262 SlJPREME COURT REPoars [1982) 3 S.C.R.
'
A conclusion possible save and except the one recorded by this Court
in Delhi Cloth &~General Mills Ltd case that this constitutes retrench-
ment and for non-compliance with pre-condition, it is invalid.

Before referring to other contentions of Mr. Francis, we may
dispose of one contention based upon construction of s. 9A of the
B Act as in our opinion, it is utter)y untenable. Mr. Francis says
that if valid retrenchment presages a notiCe contemplated by s. 25F,
the same would stand dispensed with in view of the proviso (b) of
s. 9A of the Act and therefore even if the termination is held to be
retrenchment, the same would be valid. There are two basic falla-
~, __
cits in this submission. Retrenchment to be valid must comply
c with three conditions set out in s. 25F. They are (a) subject to the
provi!O to clause (a), one month's notice in writing specifying the
reasons for retrenchment or wages in lieu of notice; (b) compensa-
tion to be paid according to the measure provided in the clause, the
payment to be simultaneous with the retrenchment; and (c) the
notice in the prescribed manner to be served on the appropriate
D Government. If the termination in this case otherwise constitutes
retrenchment admittedly clauses (b) and (c) of s.. 25F have not been
complied with. That apart, the submission that in view of the
provision contained in proviso (b) of s. 9A, the notice contemplated
by clause (a) of s. 25F would be dispensed with, is without merits.
Section 9A imposes an obligation on the employer, who proposes to
E effect any change in the .conditions of service applicable to any
workman in respect of any matter specified in the Fourth Schedule
to give notice as therein provided and the employer is precluded
from effecting the change without giving to the workman likely to
be affected by such change, nollce in the prescribed manner of the
nature of the change proposed to"be effected, and the change cannot
F
be effected within 21 days of the giving of such notice. Jn order to
attract s. 9A the change proposed must be in the conditions of
service applicable to the workman in respect of any matters specified
in the Fourth Schedule. If the proposed change falls in any of the
matters specified in the Fourth Schedule the change can be effected
after giving notice in the prescrib'd manner· and waiting for 21 days
G
after giving such notice. There is a proviso· to s. 9A which exempts
the employer from giving the notice of change if the case falls in
any of the two provisos. According to Mr. Francis the case would
be covered by proviso (b). It reads as under :
H
"9A. No employer, who proposes to effect any change
in the conditions of service applicable to any workman in
L.R. D'SOUZA v. EX. ENG., s. RAI~WAY (Desai, J.) 263..

respect of any matter specified in the Fourth Schedule, A
shall effect such change-

(a) x x x x
• (b) x x x x
Provided thai no notice shall be required for effecting any B
such change :

(a) x x x x

(b) where the workmen. likely to be effected by the change
are persons to whom the Fundamental and Supple-
mentary Rules, Civil Servic.es (Classification, Control
c
and Appeal) Rules, Civil Services (Temporary Service)
Rules, Revised Leave Rules, Civil Services Regulations,
Civilians in Defence Services (Classification, Control
and Appeal) Rules, or the Indian Railway Establish-
ment Code or any other rules or regulations that may D
be notified in this behalf by the appropriate Govern-
ment in the Official Gazette, apply".

It was obligatory upon the employer, who wants to retrench·
the workmen to give notice as contemplated by clause (a) of s. 25.
When a workman is retrenched it cannot be said that change in his E
conditions of service is e1fected. The conditions of service are set
out in Fourth Schedule. No item in Fourth Schedule covers the
case of retrenchment. In fact, retrenchment is specifically covered
by Item IO of the Third Schedule. Now, if retrenchment which

--
-~
.\
connotes termination of service, cannot constitute change in con-
ditions of service in respect of any item mentioned in Fourth
Schedule, S. 9A would not be attracted. In order to attract s. 9A
the employer must be desirous of effecting a 'change in conditions
of service in respect of any .matter 'specified in Fourth Schedule. If
F

the change proposed does not cover any matter in Fourth Schedule
s. 9A is not attracted and no notice is necessary. See Workmen of
Sur Iron & Steel Co. (P) Ltd. v. Sur Iron & Steel Company (P) G
Ltd.,(') Tata Iron & Steel Company Ltd. v. Workmen(') and Assam
Match Co. Ltd. v. Bijoy Lal .Sen('). Thus if s. 9A is not attracted
the question of seeking exemption from it in the case falling under

(1>:[1971] .1 L.L.J. 570. H
(2) [1973] l S.C.R. 594.
0) [1974] l S.C.R. 116.
264 SUPREME COURT REPORTS (1982] 3 s.c.R.

A the proviso would hardly arise. Therefore, ·neither s 9A nor the
proviso•is attracted in this case. The basic fallacy in the submission
Y-
is that notice of change contemplated by s. 9A and notice for a
valid retrenchment under s. 25F are two different aspects of notice, ·
one having no co-relation with the other. It is, therefore, futile to
urge that even if termination of the service of the petitioner consti-
B tutes retrenchment it would nevertheless be valid because the notice
contemplated by s. 25F would be dispensed with in view of the
provision contained in s. 9A, proviso (b). That apart, it is an in-
disputable position that none of the other pre-conditions to a valid.
retrenchment have been complied wi>h in this case because the very
letter of termination of service shows that services were deemed to
c have been terminated from a back date which clearly indicates no
notice being given, no compensation being paid and no notice being
given to the.prescribed authority. Therefore, termination of service,
being retrenchment, for failure to comply with s. 25F, would be
void ab initio.
D Mr. Francis next contended that as the appellant belonged to
the category of casual labour as defined in rule 2501 in Chapter
XXV of the Indian Railway Establishmeot Manual ('Manual' for
short), no notice prior to termination of bis service is necessary or
required by law in view of the pro.visions contained in Rule 2505.
The submission is that in the case of casual labour the service will
be deemed to have been terminated when such employee absents
himself or on the close of the day.

Rule 2501 reads as under:

"2501. Definition-
F
(a) Casual labour refers to labour whose employment is
seasonal,.intermittent, sporadic or extends over shorf
periods. Labour of. this kind is normally recruited
from the nearest available source. It is not liable to
transfer, and the conditions applicable to permanent
G and temporary staff do not apply to such labour, ,

(b) The casual labour on railway should be employed only
in the following types of cases, namely :

(i) Staff paid from contingencies except those retained
H
for more than six months continuously. Such of
those· persons who continue to do the same work
L.R. D'SOUZA v. BX ENG., s. RAILWAY (Desai, J.) 265

for which they were engaged or other work of A
the same type for more than six months without
a break will be treated as temporary after the
expiry of the six months of continuous employ-
ment..

(ii) Lal\our on projects, irrespective of duration, except B
those transferred from other temporary or perma-
nent employment.

(iii) Seasonal labour who are sanctioned for specific
works of less than six months duration. If such
labour is shifted from one work to another of the c
same type, e.g., relaying and the total continuous
period of such work at any one time is mor.e than
six months' duration, they should be treated as
temporary after the expiry of six months of conti-
nuous employment. For the purpose of deter-
mining the eligibility of labour to be treated as D
0

temporary, the criterion should be the period of
continuous work put in by each individual labour
on the same type of work and not the period put
in collectively by any particular gang or group of
labourers.
E
x x x
Note: (I) x x
(2) Once any individual acquires temporary
status, after fulfilling the conditions indicated F
in (i) or (iii) above, he retains that status so
Jong as he is in continuous employment on
the railwayg, In other words, even if he is
transferred by the administration to work of
a different nature he does not lose his tem-
porary status. G
(3) x x x

(4) Casual labour should not be deliberately dis-
charged .with. a view to causing an artificial
H

-
~
break in their service aad thus prevent their
attaining the temporary status,
266 SUPREMB COURT REPORTS [1982] 3 s.c.R.

A (5) x x x

Rule 2505 may as well be extracted. It reads as under :

"2505. Notice of termination of service-Except where
notice is necessary under any statutory obligation,
B no notice is required for termination of service
of the casual labour. Their service• will be deem·
ed to have terminated when they absent themselves
or on the close of the day.

Note : In the case of a casual labourer who is to be
c treated as temporary after completion of six
months' continuous service, the period of notice
will be determined by the rules applicable to
temporary Railway servants".

In order to satisfactorily establish that the applicant belonging
D to the category of casual labour whose service by deeming fiction
enacted in Rule 2505' will stand terminated by the mere absence,
it must be shown that the appellant was employed· in any of the
categories set out in clause (b) of role 2501. What has been urged
on behalf of the respondent is that the appellant was employed in
construction work and, therefore, labour on projects irrespective of
E duration would belong to the category of' casual labour. ·That,
however, does not mean that every construction work by itself
·becomes a work-charged project.· On the contrary sub· clause (I)
of clause (b) of rule 2501 would clearly show that such of those
persons belonging to the category of casual labour who continued
to do the same work for which they were engaged or other work of
F the same type for more than six months without a break will be
treated as temporary after the expiry of the six months of continuous
employment. Similarly, seasonal labour sanctioned for specific
works for less than six months' duration would belong to the
category of casual labour. However, sub clause (iii) of clause (b)
G of rule 2501 provides that if such seasonal labour is shifted from
one work to another of the same type, as for example, 'relaying'
and the '.total continuous period of such work at any one
time is more than six months' duration, they should be treated as
temporary after the expiry of six months of continuous employ-
ment. The test provided is that for the purpose of determining the
eligibility of casual labour to be treated as temporary, the criterion
should be the period of continuous work put in by each individual
L.R. D'SOUZA v. EX. ENG., s. RAILWAY (Desai, J.) 267

labour on the same type of work and not the period put in collectively A
by any particular gang or group of Jabourers. It is thus abundantly
clear that if a person belonging to the category of casual labour
-employed in construction work other than work-charged projects
' renders six months' continuous service without a break, by the
operation of statutory rule the person would be treated as temporary
railway servant after the expiry of six months of continuous employ- B
ment. It is equally true of even seasonal labour. Once the person
acquired the status of tcmp-orary railway servant by operation of
law, the conditions of his service would be governed_ as. set out in
Chapter XXIII.

Rule 2301 in Chapter XXIII defines a temporary railway c
servant. It reads as under :

"2301. Definition-A 'temporary railway servant' means
a railway servant without a lien on a permanent
post on a Railway or any other administration or
office under the Railway Board._ The term . does n
not include 'casual labour', a: 'contract' or 'part-
' time' employee or an 'apprentice'."

The service of a temporary rail way servant may be terminated
as provided in Rule 2301. •The benefits which a temporary railway
servant enjoys are set out iri the same chapter. E
The question, therefore, is whether the appellant who was
recruited as \casual labour continued to be the same or he had
acquired the status of temporary railway servant at the time of
termination of his service. In the affidavit filed irr the High Court
the respondents contended that the appellant was employed in
F
construction work on work-charged project. The High Court did
not examine this contention on merits and, therefore, it has become
obligatory upon us to probe it.

The appellant has stated that he joined as a Gangman on July
I, 1948 at Mangalapuram and he was transferred in 1953 to Pindur
G
in Mysore State. He confessed that he does not have any record
to show tliis employment but urged that if the pay roll of the
relevant period would be produced by "the Railway administration,
the fact alleged would be completely borne out. We would bypass
this controversial period, without recording any finding on it one H
way or th• other. The appellant further contends that on Nov_ember
IS, 1954, on transfer he joined in th~~Qffice of lns?ector of Work~
268 SUPREME COUllT REPORTS
I .
(19$2] 3 S.C.k. ·

A at Mangalore and since then he has been in continuous employment
in the construction branch of the Southern Railw"ay till the date of
his illegal termination of .service on . Qctober 8, 1974. These
averments are incontrovertible and have not rightly been controvert-
ed before us, in view of unimpeachable evidence produced by the
appellant. The Executive Engineer, Ernakulam, where the appellant
B at the relevant time, i.e. September 5, 1966, was working, addressed
a letter to various Executive Engineers inquiring from them whether
the surplus staff on his establishment could be absorbed by any of
them. The material portion of the letter reads as under :

Ext. P-3
c Executive Engineer's Office,
Ernakulam ·
Dated 5.9.1966

Subject :- Surplus staff (Casual labour staff) absorption of

D
"Since the major portion of the work in this construction unit is
over the list of the C.L. staff who are likely to be rendered surplus
by 30.9.66 and 31.12.66 due to expiry of sanction to the post held
by them, is enclosed.

E Please advise whether you can absorb any of these personn~I
in your construction division so that they may .be relieved in time
if they are willing''.

Enclosures :
1) List.
F List of C.L. Sta.ff Working in Xen's Office/Ers.

Sr. No. Name Presenrly working as Date of appointment
x x x
. JO. Robert D'Souza. Peon/Lascar. 15.l l.54
G x x x
This evidence furnished from the record of the respondent and not
controverted by any affidavit to the contrary would establish that
the appellant was in continuous service from November 15, 1954.
H Recall here, the fact that his service was terminated by the impugned
order contained in the letter Aunexure I dated October 8, 1974. '-{- ....
}'herefore, apart f,r()!" the period in controversy from 1948 to 1964
L.R. D'SOUZA v. EX. ENG., s. RAILWAY (Desai, J.) 269

it is unquestionably established that the appellant was in continuous _ A
uninterrupted service from Nor;ember 1954 to October 1974, a
period of 20 years and he was working as Peon/Lascar. Undoubt-
edly he has belln referred to as belonging to casual labour staff but
would it be fair to _hold that after 20 years of continuous service, he
would still continue to be a casual labour and therefore, his service
could be terminable at will, and he would not be entitled to any of B
the benefits which a temporary or a permanent railway employee
would ei;ijoy ?

There is, 'however, one more aspect to Wtlich we would refer
before we proceed to pronounce upon the status of the appellant.
The definition of casual labour e~tracted by us above clearly c
indicates that person belonging to casual labour is not liable to
transfer. The appellant has stated that he was transferred to
Madras in 1957, to Tuni in Andhra Pradesh in 1958, to
Rajahmundry in 1960, to Samalkhotan in 1961, to Virudhnagar in
1962 and to Manamadurai in 1965 and then to Ernakulam in
August 1965. It appears that he was again transferred from 0
Ernakulam which was seriously objected and he took up the matter
with the higher authorities when he was re-transferred to Ernakulam
on March 19, 1971. This appears from the letter of the Under
Secretary in the Ministry of Labour addressed to the' appellant in
which it is stated that the Ministry of Railways was advised that
the appellant be transferred back to Ernakulam, which advice has
E
been carried out and the. intervening period for which he did not
report for duty, i.e. from March 6, 1970 to.February 19, 1971, he
would be paid the wages as if he was on duty. In the face of these
incontrovertible facts could it at all be said that the appellant
though transferred ad nauseum. still continued to belong to the F
category of casual labour ?

An additional fact which butresses this conclusion may be
referred to. The appellant and several others filed petition in the
High Court of Kerala from which the present appeal arises. All
the petitioners before the High Court contended that each of them G
having rendered continuous. service for decades they could not be
said to be belonging to the category of casual labour and if anything
all of them had acquired. status of temporary employees. The
ttSl\!lndent filed counter-affidavit and contended that the appellant
and his co-petitioners in the High Court never acquired the status H
of temporary railway servant and each of them belonged 'to the
category of casual labour. D\!rin~ th~ pendency of the petition

•
270 SUPREME COURT REPORTS (1982] 3 s.c.R.

A in the High Court service of the appellani was terminated but his
co-petitioners continued in service.• After the dismissal of the writ
petition by the learned single judge appellant and three others
preferred Writ Appeal No. 218 of 1973 in the same High Court. By
the time the appeal came up for hearing three co-appellants of the
present appellant who were appellants before the Division Bench
B
were informed that they were treated as on regular employment and
ceased to belong to the category of casual labour. Unfortunately
as the service of the appellant was already terminated' hc was not
given this benefit.. This fact clearly emerges from the manner in
which the Division Bench disposed of the appeal before it. The
c relevant observation is as under:

"In view of the letters received from the Executive j,
Engineer, Southern Railway, addressed to Shri K.P.
Pathrosa, advocate, appearing for respondents in the writ
appeal, it has bf come unnecessary to ·consider this writ
"D appeal on merits".

With reference to the appellant it was stated as under :

. "As regards the first appellant, it is stated th11t he
absented himself from (duty and so he had been denied ·
E employment. Since then another Writ Petition 0. P. No.
4401/74 bas been filed by the fits! appellant and is now
pending before this Court. The contention of the first
appellant incluaing what has been 'raised in this petition
will be considered in O.P. 4401/74".
'
F By the letters referred to. by the Division Bench, the Executive
Engineer informed the advocate appearing for Railway administra-
tion that appellants other than the present appellant were absorbed
as regular railway employees and hence .the appeal has become
infructuous. - Unfortunately for the appellant he was denied this
benefit as his service was already terminated. If his service was not
G terminated, his case was not distinguishable from the case of his
co-appellants and he would have been entitled both in Jaw and facts
to the same treatment. The approach of the Railway administration
to say the least is amazing. For years they did not act according
to law and confer status of temporary railway servant on the appel-
H lant and his colleagues in the High Court. ,When appellant espoused
ttis cause he was thrown out but his colleagues were given the
l>enefit rjchly deserved in law. This discriminatory treatment cannot

•
LR.. D'souzA v. EX. ENG., s. RAILWAY (hesai, J.) 2t1
help the respondent because appellant's case cannot be distinguished. A
If the status of temporary railway employee was already acquired
before the tetmination of service in the manner brought about, the
same would be ipso facto invalid. At this stage we would again
revert to the annexure to the letter of Executive ·Engineer dated
• September 5, 1966, in which the name of the appellant appears at

-·
Serial No. IO, One of the co-petitioners of the appellant in the B
High Court, who got the benefit of regular employment pursuant
to the writ petition was one Shri K.N. Balakrishna. His name
appears at Serial NQ. I in the annexure to the letter of Executive
Engineer referred to above. His date of appointment is shown to
be March 24, 1954. It would thus appear at a glance that the case
of the appellant could not be distinguished from the case of Shri c
K.N. Balakrishna and if Shri Balakrishna was accorded the status of
regular employee, the appellan.t coufd not be treated otherwise,. but
for a singular unfortunate event of his termination of service. He
. could not be singled out for such treatment, Had his service not
been terminated, the Railway administration could not have denied
him the status and this status he would have acquired long back. D
If by operation of law, to wit, Rule 2501 the appellant had acquired
the status of temporary railway servant by rendering continuous
uninterrupted service for . more than six months, his service could
not have been terminated under rule 2505. It, however, needed'
moral force of fast and costly court proceedings by a low daily paid
workman against the Railway administration in the High Court to
E
obtain such meagre benefit. It would thus clearly appear that even
a
'the appeilant would have acquired the status of at least temporary
railway servant. But we would rather like to refer to the legal '
position in this behalf more accurately.

To start with, let us recall the rule 250l(b) (i) and (iii) and
note below rule 2505. The underlying intendment of the provison
is that a casual labourer who has rendered six months' continuous
service would be place in the category of temporary railway servant
unless he is employed on work-charged project.

Rule 2501(b) (i) clearly provides that even where staff is paid G
from contingencies; they would acquire the status of temporary
railway servants after expiry of six . months of continuous employ-
ment. But reliance was placed on rule 2501(b) (ii) which provides
that lab our on projects, irrespective of duration, except those trans- H
ferred from other temporary or permanent employment would be
treated as casual. Jabour. In order to bring the case within the
272 StJPllEMti COUllT llEPollTS (1982) 3 s.C.11.

A ambit of this provision it must be shown that for 20 years appellant
was employed on projects. Every construction work does not
imply project. Project is Correlated to planned projects in which
the workman is treated as work-charged. The letter dated September
5, 1966, is by the Executive Engineer, Ernakulam, and he refers to
the staff as belonging to construction unit. It will be doing violence
B to language to treat the construction unit as project. Expression
'project' is very well known in a planned development. Therefore,
the assertion that the appellant was working on the project is belied
by two facts : (i) that contrary to tlie provision in Rule 2501 that
persons belonging to casual labour category cannot be transferred,
the appellant was transferred on innumerable occasions as evidenced
c by orders Ext. P-1 dated January 24, 1962, and Ext. P-2 dated
August 25, 1964, and the transfer was in the office of the Executive
Engineer (Construction); (ii) there is absolutely no reference to pro-
ject in the letter, but the department is described as construction unit.
If·he became surplus on completion of project there was no- neces-
D sity to absorb him. But the letter dated September 5, 1966, enquires
from other executive engineers, not attached to projects, whether
the surplus staff including appellant could be absorbed by them. This
shows that. the staff concerned had acquired a status higher than.
casual labour, say temporary railway servant. And again eonstruc-
tion unit is regular unit all over the Indian Railways. It is a
E permanent unit and cannot be equated to project. Therefore, the
averment of the Railway administration that the appellant was
working on project cannot be accepted. He belonged to the con-
struction unit. He was transferred fairly often and he worked
contjnuously for 20 years and when ·he questii>ned the bona }ides
of his transfer he had to be re-transferred and paid wages for the
F period he did not report for duty at the place where he was trans-
ferred. Cumulative effect of these facts complettily belie the
suggestion that the appellant worked on project. Having rendered
continuous uninterrupted service for over six months, be acquirea
the status of a temporary railway servant long before the termina-
tion of his service and, therefore, his service could not have been
G terminated under Rule 2505.

Once it is held that by operation of statntory rule in the
. Manual, the appellant had acquired a status of- temporary railway
servant and assuming, as contended by Mr. Francis, that the termi-
H nation of service in the circumstances alleged does not constitute
retrenchment stricto sensu, would the termination be still valid ?
l..k. ti 1SOUZA v. llX. ENG., s. RAILWAY (Desai, J.) 273
The answer is an emphatic no. On the admission· of the Railway
administration, .service was terminated on account of absence
during the period appellant was on fast. Absence wjtbout leave
constitutes misconduct and it is not open to the employer to
terminate .service without notice and inquiry or at any rate without
·• complying with the minimum principle of natural justice. Further,
rule 2302 clearly prescribes the mode, manner and methodology of B
terminating service ofa temporary railway servant and admittedly
the procedure therein prescribed having. not been carried out, the
termination is void and invalid. Accordingly, the same conclusion
would be reachep even while accepting for the purpose of the facts
of this case simultaneously rejecting it in i,Iaw that the termination
does not constitute retrenchment yet nonetheless it would be void
c
and inoperative.

We would be guilty of turning a blind eye to a situation apart
from being highly unethical, wholly contrary ·to constitutional
philosophy of secio-economic justice if we fail to point out that D
Rule 250 I which J)ermits a man serving for 10, 20, 30 years at a
str•tch without break bein.g treated as daily rated servant, is
thoroughly opposed to the notion of socio-economic justice and it
is high time that the Rai!Way administration brings this part of .the
provision of the Manual, antequarian and antidiluvian, in conformity
with the Directive Principles of State Policy as enunciated. in Part IV E
. of the Constitution. It may be necessary for a big employer like
the railway to employ daily rated workmen but even here it is made
distinctly clear that in case of casual labour, the daily wage is fixed

-
by dividing montli.ly minimum wage by 26 so as to provide a paid
holiday. Maybe, for seasonal employment, or for other intermittent
work daily rated workmen may have to be employed. It may as
F
well be that on projects workcharged staff may have to be employed
because on the completion of the projects the staff may become
surplus. That was at a time when planning and projects were
foreign to the Indian economy. Today, Railways perspective plans
spreading over decades. If one project is complete another has to G
be taken over. Railway administration bas miles to go and promises
to keep and this becomes clear from the fact that the appellant, a
daily rated workman, continued to render continuous service for
twenty years which wo!ild imply that there was work for daily rated
workman everyday for twenty years at a stretch without break and H
--~- yet his status did not improve and continued to be treated as daily
rated casual labour whose service can be terminated at the whim
'
SUPREME COURT REPokTS (1982] .3 s.c.k. _

A and fanc/of the local satraps." .Itis high .time that theS(: µiterly
unfair provisions wholly denying socio-economic justice are properly
modified and brought in conformity with the modern concept of
justice and fairplay to the lowest and lowliest in Railway admi11istra-
tion.

·s Now, if appellant had become at least a temporary railway
servant he is entitled to many benefits set out in Rule 23_03 onwards.
We have no doubt in our minds that the appellant whose case was
on par with Shri K.N. Balakrishna who had already been offered
regular employee status, would be entitled to be placed in the same
category and that too from the date much earlier -to the date of
termination of his service. In this situation terminatiOn of his service
not being covered by any of the excepted categories and not after
notice would be retrenchment within the meaning of the expression j-
as used in the Act _and for the failure to comply with -the pre·
condition the termination of service would be void.

D Assuming we are not right in holding that the appellant had
acquired the status of a temporary railway servant and that be conti.
nued to belong to the category of casual labour, would the termina-
tion of the service in the circumstances mentioned by the Railway
administration constitute retrenchment under the Act ?
.E
Section 25F of the Act provides that no workman employed i.n
any industry who bas been in continuous service for not less than
one year under an employer shall be- retrenched by that employer
untill the conditions set out in Act ate satisfiecJ. The expression
'workman' is defined as nnder : .,..
F
"In this Act, unless there is anything repugnant in the
subjeePor context :
7
.-
"Workman" means · any person (including an
apprentice) employed in any industry to do any skilled or
G
' tinskil!Cd manual, super~isory, technieal or Clericl\l work for
.hire or reward, whether the terms of employment be
- expresssed or implied, and for the purposes of any ·proceed-
ing under this Act in relation to an industriaf dispute,
a includes any such person 'Who has been dismissed, discharged
or retrenched in connection with, or as a consequence of,
- that dispute, or whose dismis~a'.li discharge or retrenchment
,
....hi!~ ,Jed to tl;tat dispute, but d\)es. nQt. ~uclu~e any.,such
.
person,-
,. . .
· (i) who. is subject tp tb'e'~rmy Act, 1950, oi'the Ai.t ·
. Force Act, 19SO or the Navy (Discipline) Act,
1934, or
B
(ii) who is employed in the police service or as an'-;
officer or other employee of a prison; or

(iii) who is employed mainly in a.managerial or admi·
~ nistrative capacity; or c
I
-i -~
(iv) who, being employed in a supervisory capacity,
draws wages exceeding five hundred rupees per
mensem or exercises, either by the nature of the
duties attached to the. office or by reason of the
-\ powers vested in him, functions mainly of a D
manageri!tl nature!'
-1
I
There is no dispute that the ajlflellant would be a workman
within the meaning of the expression in s. 2(s) of the Act. Further,
it is incontrovertible that he has rendered continuous service for a
period over twenty years. Therefore, the first ·condition of s. 25F E
that appellant is a workman who has rendered service for not less
than one year under the Railway administration, an employer
• carrying on an industry, and that his service is terminated which for
the reason hereinbefore given would constitute retrenchment. It is
immaterial that he is a. daily rated worker. He is either doing
mannual or technical work and his salary was less_ than Rs. 500/· F
and the termination of his service does not fall in any of the except·
ted _catagori~s. Therefore, assuming that he was. a daily rated
worker, once he has rendered continuous uninterrupted service for a
period of one year or more. within the meaning of s. 25F of the
Act and his service is terminated for any reason. whatsoever and the
case does not fall in any of the excepted catagories. notwithstanding G
the fact that Rule 2505, would be attracted, it would have to be read
subject to the provisions of the Aet. Accordingly the termination of
service in this case would constitute retrenchment and for not
complying with pre-conditiOJ!S to valid retrenchment, the ord~r of
termination would be illegal and invalid.
H
27~ St1Pil!MB cotllT ll!POlts il982J !I s.C.l.
A 'Accordingly, we allow this appeal, set aside the order of the
High Court and declare that the termination of service of the
app~llant was illegal and invalid and the appellant continues to be in
service and he would be entitled to full back wages and costs quanti-
fied at Rs. 2,000. ·

B
S.R. Appeal allowed.

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