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Reinstatement during the pendency of proceedings

FACTS

  • The appellant worked for the bank in question. In the departmental hearings, the bank fired him. The appellant filed a complaint against the stated dismissal order with the Central Government Industrial Tribunal by section 10(2)(a) of the Industrial Disputes Act. The CGIT overturned the dismissal decision and issued a decision ordering the reinstatement of the appellant along with 50% of unpaid pay and the withholding of four yearly raises, effective from the date the decision was made, or 18.07.2007, until the date of reinstatement. The High Court heard a case challenging the CGIT order.
  • While confirming the reinstatement ruling, the Single Bench of the HC decreased the back wages from 50% to 25%. The Division Bench of the same Court confirmed the restoration ruling while denying the appellant’s claim for back wages. On July 12, 2013, a Special Leave Petition was also filed in opposition to this order, however, it was denied.
  • In the end, the CGIT order from July 18, 2007, became legally binding. The appellant once again applied section 33-C(2) of the ID Act after the bank failed to pay the appellant’s full wages from the date of the order until the date of reinstatement. The appellant was successful, according to CGIT. The respondent bank filed an appeal against the decision, and the High Court overturned it because the CGIT lacked the power to decide the application under Section 33-C(2) of the Act. The case of Bombay Chemical Industries v. Deputy Labour Commissioner & Anr. was cited by the High Court. [(2022) 5 SCC 629] The current appeal is made to the Supreme Court against this contested decision of the High Court.

ARGUMENTS RAISED BY THE APPELLANT

  • The appellant argued that the High Court erred in its application of the Bombay Chemical Industries Case’s ruling. According to the argument made by Namer Ali Choudhary & Ors. V. Central Inland Water Transport Corporation Ltd. & Anr. [(1997) 4 SCC 575], the question of how much money is owed under an award will be the focus of a proceeding under section 33-C(2) of the ID Act once one has been made.
  • It was further argued that the employee or workman would suffer for no fault of his if the High Court’s ruling were affirmed. The knowledgeable attorney also claimed that the award’s demand for reinstatement will not be diminished by the fact that the procedures are still pending.

ARGUMENTS RAISED BY THE RESPONDENT

  • The respondent’s knowledgeable attorney claimed that the High Court had temporarily stopped the 18.07.2007 award from taking effect. Invoking the theory of merging, the learned attorney argued that the award from July 18, 2007, merges with the judgment and order from July 12, 2013, and that only the final judgment and order issued by the Division Bench of the High Court on July 12, 2013, shall be enforced.
  • As a result, the appellant will not be eligible to claim unpaid wages for that time. Additionally, it was claimed that the appellant received payment for the last drew wages for the duration of the award’s stay by section 17 B of the Act. As a result, he was not entitled to receive his full back pay for that time.

LEGAL ISSUE

Is the appellant eligible to receive their entire salary from the date of reinstatement award, 18.07.2007, passed by the CGIT, to the actual date of reinstatement, 23.09.2013?

OBSERVATION BY THE COURT

  • a final order is always subject to an interim order, it was noted. Therefore, it cannot be sustained that the appellant can be denied the back wages just because there was an interim stay of the order of reinstatement while the suit was underway, as the Court finally confirmed the stated order of reinstatement.
  • The learned attorney for the defendant in the current instance argues that the principle of merging is not applicable. The appellant was paid the last drawn wages under Section 17B of the ID Act for the period during the stay of the order of reinstatement, but this did not prevent him from obtaining earnings for that period, according to the Court’s subsequent observation. However, when paying wages, such an amount paid may be subtracted from or changed.
  • The High Court erred in using the ruling in the Bombay Chemical Industries Case, the Court further observed. As the appellant contacted the CGIT with his complaints, and the CGIT passed the proper order after adjudicating the stated problems, it cannot be said that the appellant’s claim was not decided upon in the current instance.

RATIO DECIDENDI :

 An employee cannot be refused back pay when the order of reinstatement was ultimately confirmed simply because there was an interim order or stay of the order during the pendency of proceedings: SC

JUDGEMENT

The present appeal is allowed accordingly to the aforesaid extent.

Conclusion

The Apex Court overturned the challenged order of the learned High Court in light of the aforementioned observations. The bank was ordered by the Apex Court to pay the appellant’s entire earnings and all other benefits from the date of the reinstatement order, which was 18.07.2007, until the date of reinstatement, which was 12.07.2013. The Court also authorized the deduction of the money already paid by ID Act Section 17B.

 

Original Judgment – C.A. No. 9008/2022 – D.No. 26973 / 2022 12-Dec-2022

 

Written by M.Sahithi, GITAM SCHOOL OF LAW

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