Special Civil Application No. 10741 of 2008
Santram Spinners Limited Vs Babubhai Magandas Patel
Date of Order:
Justice Sandeep N. Bhatt
SANTRAM SPINNERS LIMITED – Petitioners
BABUBHAI MAGANDAS PATEL – Respondents
The Gujarat High Court has overturned the Labour Court's ruling that the Respondent-worker was entitled to 20 percent payback and reinstatement in the Petitioner-institute. The High Court determined that the Respondent was receiving consultancy fees rather than a salary after reviewing Form No.16A, which relates to Tax Deducted at Source. The Labour Court had disregarded the same.
- This petition was filed under Articles 226 and 227 of the Indian Constitution challenging the order dated 30/11/2007 issued by the Labour Court at Kalol in Mehsana District by which it was ruled that the respondent – worker was entitled to continue rendering his services to the company and receive 20% back wages.
- The respondent, a worker, had filed a labour complaint, alleging, among other things, that he was employed by the petitioner company's spinning department as a maintenance operations in-charge and making Rs. 9,000 monthly. And that he was terminated verbally on April 18, 1997.
- The petitioner submitted that the respondent, a workman, cannot be referred to as a workman in accordance with Section 2(S) of the Industrial Dispute Act, 1947. And that the Respondent-Workman was hired by the petitioner on a contract basis while serving as a maintenance consultant and receiving consulting fees.
- The respondent-worker failed to present any paperwork, such as an appointment letter or pay slip, to support the existence of employer-employee relations. In addition, the petitioner-company presented many documents before the learned Labour Court to demonstrate that the respondent-worker was employed as a consultant, including bills and TDS statements.
- Thus, the current petition.
Arguments Advanced by the Petitioner – Company
- The respondent, a workman, cannot be referred to as a workman under the terms of Section 2(S) of the Industrial Disputes Act, 1947, as submitted by the learned counsel for the petition. Furthermore, the petitioner corporation was unfairly required to bear the burden of demonstrating that the respondent-worker was not in fact an employee.
- It was argued that the learned Labour Court had not acted in accordance with the established Supreme Court precedent and that the respondent worker must provide evidence that he had worked for the petitioner.
- In this instance, the respondent worker also failed to provide any sort of evidence to support his claim that he was working with the petitioner. The learned Labour Court should not have determined that the petitioner and the respondent-workman had an employer-employee relationship in the absence of any supporting documentation.
- In addition, the learned Labour Court failed to recognise that the respondent was required to present certain documents, such as his income tax return, to prove that he was an employee.
- The respondent ought to have specified his status as a professional or salaried person while requesting TDS from the Income Tax Department, and the learned Labour Court should have inferred the opposite in the absence of any documentation provided by the respondent.
- The learned counsel bases this claim on the judgment of the Hon'ble Apex Court in the case of State of Uttarkhand Vs. Sureshwati reported in (2021) 3 SCC 108, more specifically paragraphs 17 and 18.He asserts that in the aforementioned judgment, the employee has the entire burden of proving that he has worked continuously for a period of 240 days in the petitioner institute as a workman.
Arguments Advanced by Respondent – Worker.
- Learned counsel appearing for Respondent-worker claims that by providing continuous effect in service, the Labour Court did not mistake in restoring him with 20% of his lost income. He has argued that the contested judgment and award issued by the learned Labour Court is just and appropriate, and supported by sufficient grounds.
- The employer had been found to have filed Income Tax Form No.16A, through which the employer deducted tax from the respondent's pay, demonstrating that the respondent is employed as a workman by the petitioner company.
- He argues that the learned Labour Court correctly inferred a negative outcome for the petitioner corporation because the company failed to provide any supporting documentation, such as an attendance record or salary register, to demonstrate that the respondent was not an employee of the petitioner.
- The court took note of the petitioner company's specific denial that the respondent company is included in the definition of a workman with regard to Section 2(S) of the Industrial Dispute Act, 1947, in the written statement submitted by the current petitioner to the learned Labour Court.
- It was further noted that the learned Labour Court had made grave mistakes by concluding that the petitioner's complicated submission of pertinent documents justified its deduction of TDS and that the respondent is therefore a worker employed by the petitioner institute. These conclusions of the learned Labour Court are highly erroneous and go against the established principle of law.
- The petitioner has successfully established its defense by providing strong and convincing evidence in the form of vouchers, a TDS certificate, and other documents. Additionally, the petitioner has proven its case by successfully cross-examining the respondent workman, demonstrating that the labor court made a serious error in its decision.
It was decided that this is a case where the supervisory powers under Article 227 of the Indian Constitution should be exercised by interfering with the impugned judgment and award passed by the learned Labour Court because the findings made by the learned Labour Court are found to be perverse, illegal, and improper and the same is against the materials available on record.
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