IN THE HIGH COURT OF JHARKHAND AT RANCHI. W.P. (L) No of 2008

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1 IN THE HIGH COURT OF JHARKHAND AT RANCHI. W.P. (L) No of 2008 Birendra Kumar Singh Petitioner -V e r s u s- Secretary, Foundary Forge Co-operative Society Ltd., Dhurwa, Ranchi CORAM: - HON BLE MR. JUSTICE D.G.R. PATNAIK. For the Petitioner For the Respondents Respondent. : - Mr. Jugal Kishore Prasad, Advocate. : - M/s. Ashwini Kumar, Prabhat Kr. Sinha and Vikram Kr. Sinha, Advocates. C.A.V. On: - 01/07/2009 Delivered On: - 10/07/2009 / Challenge in this writ application is to the Award dated , passed by the Presiding Officer, Labour Court in B.S. Case No. 13 of 2005, whereby the petitioner s application filed under Section 26 (2) of the Bihar (Jharkhand) Shops & Establishments Act, was dismissed. 2. Heard Mr. Yughal Kishore Prasad, learned counsel for the petitioner and Mr. Ashwini Kumar, learned counsel for the Respondents. 3. The brief facts of the case are as follows: - The petitioner-foundary Forge Cooperative Societies Ltd., Dhurwa, Ranchi, represented by the Secretary (Respondent No. 1), is an establishment, carrying on various businesses, and one of its business engagements is of sale and distribution of Indane Gas Refills amongst its customers. The service of the petitioner was engaged under the Respondent-Society as a Driver for carrying the Gas refills and as per petitioner s claim, he was appointed as Driver since October, 1991 on monthly wages of Rs.1965/- inclusive of Dearness Allowance and was continuously working as such. On account of non-supply of Gas by the Indian Oil Corporation the Gas Agency business of the Society could not continue since September, 2002 and the petitioner, as such, was not assigned any work, although he was given some amount, by way of subsistence allowance for a few months. The business of Gas Agency of the Respondents was revived on and from , but despite the petitioner presenting himself at the office of the Respondents, he was not given any work and on the other hand, other persons were employed by the Respondents. Being aggrieved, the petitioner filed representations before several authorities, including the Deputy Labour Commissioner, Ranchi, who entered into a conciliation proceedings calling upon the employer to appear and submit their replies to the petitioner s demand. The Respondent-society did not

2 [2] appear before the Deputy Labour Commissioner, Ranchi. Consequently, the Deputy Labour Commissioner vide Communication dated , advised the petitioner to file a case under the provisions of the Bihar (Jharkhand) Shops &Establishments Act. Upon such advice, petitioner filed a complaint under the provisions of Section 26 (2) of the Bihar (Jharkhand) Shops & Establishments Act before the court below raising the following grounds: - (i) The petitioner was in continuous employment for the past 15 years. (ii) Without there being any charge of misconduct against the petitioner, his service has been terminated. (iii) His employer has otherwise terminated his services without serving him the mandatory one month s notice or paying one month s wages nor has any compensation being paid to him. 4. The Respondent-Society appeared before the court below in the proceeding and through its written statements, had contested the petitioner s claim on several grounds stating, inter alia, (i) that the complaint itself is not maintainable, (ii) that the complaint is barred by limitation, (iii) that the petitioner was only a casual worker and not a permanent employee, (iv) that the payment of subsistence allowance was made by the Administrator who was put in charge of the Management of the Society during the period of its supercession and that such payments, were found by the Auditor to be illegal payments and the Auditor had asked the Respondents to realize the amount so paid from the petitioner, (v) that during the period when the business of gas Agency of the Respondents, remained inoperative between September, 2002 to April, 2005, there was no work to be assigned to any employee, much less the petitioner, (vi) that on the eve of the revival of its business of Gas Agency, the Respondents have published a notice, which was displayed on the notice Board, calling upon its own employees including the petitioner to rejoin their duties on 02 nd May, 2005 but none of the

3 [3] workers had joined and as such, new employees were inducted in the Gas Agency Business of the Respondents. 5. On the basis of the rival claims, the learned court below framed the following three issues: - (i) Whether the complaint petition under Section 26 (2) of the Bihar Shops & Establishments Act read with Rule 21 of the Jharkhand Shops & Establishments Rules is maintainable? (ii) Whether the complaint petition is hopelessly barred by limitation? (iii) Whether the applicant is entitled to get any relief as claimed or reliefs? 6. By recording its finding on each of the issues framed, the labour court dismissed the petitioner s complaint. 7. Assailing the impugned order of the court below, learned counsel for the petitioner has, inter alia, advanced the following arguments: - (i) That the finding of the learned court below on the Issue No. 1 is totally misconceived on points of law as well as on facts. Learned counsel elaborates that the observation in the impugned order that the work of distribution of LPG gas remained closed during the period to by order of Indian Oil Corporation., is contrary to the admitted facts, in as much as, even the Respondent-Society, in its written statements, has admitted that the business of Gas Agency had remained only suspended during the aforesaid period and therefore, it cannot be said that the business of Gas Agency was permanently closed. Learned counsel explains further, that there is no provision of closure or its legal consequences under the provisions of the Bihar (Jharkhand) Shops & Establishments Act. A provision of closure is though prescribed under Rule 9 of the Jharkhand Shops & Establishments Rules 2001 but such closure relates to permanent closure of any establishment and under which, the employer is bound to notify the fact of closure within seven days to the Inspecting officer. Admittedly, no such closure was ever notified by the Respondent-Society to the Inspecting Officer. As such, the only inference from the admitted facts, would be that the work of Gas Agency of the Respondent-Society had remained

4 [4] suspended from September, 2002 to April, 2005 and the business was not permanently closed. Learned counsel argues further that the learned court below has wrongly relied upon the ratio in the case of Rajeshwar Prasad Jaiswal-versus-Bikram Singh and others, reported in 1978 B.L.J.R. 18 and also on the ratio laid down in the case of Gokul Rana-versus-Presiding Officer, Labour Court, Jamshedpur & Others 2002 (3) J.C.R. 391 (Jhr.). Learned counsel explains that the ratio in the case of Rajeshwar Prasad Jaiswal (Supra) would not apply to the facts of the present case, since that was in the matter of closure of business and not of cessation of work. Referring to the case of Gokul Rana (Supra), learned counsel argues that the ratio laid down by this Court in the aforesaid case is on the ground that there is no mention of the term otherwise terminated in Rule 21 (1) of the Jharkhand Shops & Establishments Rules, 2001 and hence no valid and lawful complaint can lie under Section 26 of Bihar (Jharkhand) Shops & Establishment Act if the ground taken by complainant is based on the ground of otherwise termination. Learned counsel argues that even though Rule 21 (1) of the Rules does not specifically mention the term otherwise termination but such expression has to be read as part of the Rules by implication and by a reading of the provisions of Section 26 (2) of the Act, which lays down that every employee, dismissed, discharged or whose employment is otherwise terminated, may make a complaint in writing in the prescribed manner, to a prescribed authority within 90 days from the date of receipt of such order. Learned counsel argues that it is a settled law that the Rule framed under the provision of any Act is a subordinate legislation and if any provision of the Rule is in conflict with the provision of the Act, the provision of the Rule, to the extent of such conflict, is ultra vires of the Act. Learned counsel submits that the ratio laid down in the case of Gokul Rana (Supra) is per incuriam and hence not binding on any court. In support of his arguments, learned counsel for the petitioner refers to and relies on the Division Bench Judgment of this Court in the case of Krishna Chandra Yadav-versus-Presiding Officer, Dhanbad & Another, reported in 2002 (3) J.L.J.R (ii) On the findings of the court below on the second issue, namely, the issue of limitation, learned counsel argues that

5 [5] the observation of the learned court below that the cause of action, if any, had accrued to the petitioner on , i.e. the date when the business of the Gas Agency of the Respondent-Society was closed and that therefore, the application under Section 26 (2), having been filed beyond the period of 90 days and that too without praying for condoning the delay is barred by limitation, is totally misconceived and contrary to the facts pleaded by the petitioner. Learned counsel explains that it is the definite case of the petitioner that the Gas Agency business of the Respondent- Society was never permanently closed. Rather, it was suspended for a certain period. The petitioner was never served with any notice of discharge or termination from his service and he used to report at the office of the Respondent-society even during the period of suspension of the Gas Agency and he used to be paid some subsistence allowance during the period. It was only on receipt of the letter of the Deputy Labour Commissioner, on , that the petitioner could learn for the first time that his services was otherwise terminated by the Respondent-society and within the period of limitation from the date of such knowledge, the petitioner had filed his complaint under Section 26 (2) of the Bihar Shops & Establishments Act and, as such, the petitioner s application cannot be said to be barred by limitation. Learned counsel argues further, that it is a settled principle of law that cessation of work is included in the definition of continuous service in labour law as defined in Section 25 B of the Industrial Disputes Act. According to the learned counsel in absence of any formal order issued by the Respondent-society terminating the employment of the petitioner, there is no date for computing the period of limitation of 90 days. Adding further to his arguments, learned counsel submits that on the basis of the rival pleadings of the parties, and being the first court of facts, it was a mandatory requirement of law for the learned court below to give its findings on two other issues, namely, (i) whether the complainant has been in continuous employment for a year or not? and (ii) whether the complainant, was gainfully employed during the period of suspension of the Respondent s business till the date of the filing of the instant case? Learned counsel argues that these being the two core issues in

6 [6] every case under Section 26 (2) of the Bihar (Jharkhand) Shops & Establishments Act, in absence of any finding on the same, the impugned Award, cannot be sustained in the eye of law and is liable to be set aside. 8. Through its counter affidavit, the Respondent-society has denied and disputed the entire claim of the petitioner. Controverting the grounds advanced by the petitioner, Mr. Ashwini Kumar, learned counsel for the Respondents submits point wise arguments as follows: - (i) The findings of the labour court are based on the materials available on record, admitted facts and on the points of law and there is no perversity in the findings. (ii) The order, passed under Section 26 (6) of the Bihar (Jharkhand) Shops & Establishments Act, is final and binding upon the parties and no appeal has been prescribed in the Act against the Award and therefore, the writ jurisdiction of this Court cannot be invoked as a measure of substitute of the appeal, particularly in absence of any substantial question of law involved. (iii) The petitioner, being a daily wage employee, cannot claim his re-employment as a matter of right. (iv) The statutory provisions prescribed by the Rules, relating to the filing of a complaint under Section 26 (2) of the Act, does not enable an employee, whose services have been otherwise terminated, to file a complaint under Section 26 (2) of the Act. This has been clearly dealt with in the case of Gokul Rana (Supra) and the learned court below has rightly applied the ratio laid down in the aforesaid judgment for dismissal of the petitioner s complaint. The alternative remedy available to the petitioner was by initiation of a proceeding for conciliation under Section 12 of the Industrial Disputes Act, 1947 and raising an industrial dispute, thereafter under Section 2 A of the Industrial Disputes Act. (v) Even otherwise, the complaint petition filed before the labour court was hopelessly barred by the law of limitation. The petitioner had admittedly come to know that the Gas Agency Business of the Respondent-society was closed indefinitely and after the closing of the business, he was admittedly, never offered employment. The complaint

7 [7] under Section 26 (2) of the Act, ought to have been filed by him within 90 days from the date of termination of his service. (vi) After the closure of the Gas Agency Business of the Respondent-society, an Administrator was appointed and during the period when the Administrator was in-charge, he had paid some subsistence allowance to the petitioner for some period during the period of closure of the Gas Agency Business. Such payment was unwarranted and was declared as illegal by the order of the Auditor and was recoverable from the petitioner. The petitioner cannot, therefore, claim that he was kept on live roster of employees under the Respondent-society during the period when the Gas Agency business of the Respondent-society was closed. 9. From the rival submissions, the admitted facts which emerge are that the business of Gas Agency distribution was stopped with effect from on account of non-supply of gas by the Indian Oil Corporation. Such business of the Respondent-Society depended essentially upon the supply of Gas by the Indian Oil Corporation and it was not certain as to whether the supply would ever be resumed by the Corporation. The Respondent-society had thus, to undergo bona fide closure of its business. The termination of employment of its employees, is apparently the result of the closure of its business. Such termination is apparently not on account of any positive step taken by the employer, but on account of the fact that the employer had no work to offer to its employees. This being a case of bona fide closure of the employer s business, the employee is not entitled to any compensation under Section 26 of the Bihar (Jharkhand) Shops & Establishments Act. This view finds support from the judgment of the Patna High Court in the case of Rajeshwar Prasad Jaiswal-versus-Bikram Singh & Others, reported in 1978 B.L.J.R. 18. Under such circumstances, the employee would not be entitled to payment of any compensation under the provisions of Section 26 of the Bihar (Jharkhand) Shops & Establishments Act. The contention of the petitioner that it cannot be considered to be a closure of business, since the Bihar (Jharkhand) Shops & Establishments Act, does not provide for a situation of closure, and if at all such term is sought to be imported in the facts of the present case, it has to be made by reference to the definition of the term closure as given under the Industrial Disputes Act, appears to be misconceived. The term closure has been used and defined under the Industrial Disputes Act in relation to industrial establishments and cannot be equated with Shops and Establishments as defined under the Bihar (Jharkhand) Shops & Establishments Act. Even

8 [8] otherwise, the Industrial Disputes Act, 1947 and the Bihar (Jharkhand) Shops & Establishments Act, 1953 are two separate and distinct statutes which operate in their respective fields. No provision of the Industrial Dispute Act, 1947 can possibly be imported or applied for reference in respect of the disputes under the Bihar (Jharkhand) Shops & Establishments Act. 10. As regards the finding of the court below on the controversy raised by the Respondent regarding the maintainability of the petitioner s complaint under Section 26 (2) of the Bihar (Jharkhand) Shops & Establishments Act, the same is based on the ground that though the provisions of Section 26 of the Bihar (Jharkhand) Shops & Establishments Act, enables filing of a complaint case in case of otherwise termination of the services, but the corresponding Rule of procedure does not enable as such. otherwise terminated, from service. Admittedly the petitioner has claimed to have been 11. Section 26 (2) of the Bihar Shops & Establishments Act reads as under: Notice of the dismissal or discharge. - (1) No employer shall dismiss or discharge or otherwise terminate the employment of any employee who has been in his employment continuously for a period of not less than six months except for a reasonable cause and after giving such employee at least one month s notice or one month s wages in lieu of such notice: Provided that such notice shall not be necessary where the services of such employee are dispensed with on a charge of such misconduct as may be prescribed by the State Government, supported by satisfactory evidence recorded at an enquiry held for the purpose: Provided further that an employee who has been in continuance employment for a year or more and whose services are dispensed with otherwise than on a charge of misconduct shall also be paid compensation equivalent to fifteen days average wages or every completed year of service and any part thereof in excess or six months before his discharge in addition to the notice or pay in lieu of notice as prescribed above. (2) Every employee, dismissed or discharged or whose employment is otherwise terminated, may make, a complaint in writing in the prescribed manner, to a prescribed authority within 90 days of the receipt of the order of dismissal or discharge or termination of employment on one or more of the following grounds, namely: - (i) there was no reasonable cause for dispensing with his service; or (ii) no notice was served on him as required by sub-section (1); or (iii) he has not been guilty or any misconduct as held by the employer; or (iv) no compensation as prescribed in sub-section (1) as paid to him before dispensing with his service.

9 [9] 12. It is apparent from the above that the complaint can be filed by an employee, whose services were otherwise terminated. Sub-section 2 of Section 26 of the Act provides that the complaint in writing may be filed before the prescribed authority within 90 days from the date of receipt of order of discharge/dismissal or from the date of the service otherwise terminated, in the prescribed manner. Rule 21 of the Jharkhand Shops & Establishments Rules, 2001 lays down the prescribed manner in which a complaint under Section 26 of the Act can be filed. It may be noted that though, the expression otherwise termination was introduced by way of a later amendment in the year 1975, but no corresponding amendment was carried out in the Rules to include the aforesaid expression and such situation continues to exist, though the statute under Section 26 of the Act provides that a complaint can be filed by the employee whose services have otherwise been terminated. Where the statute provides a Right, the Rules of procedure should also make an enabling provision for claiming the right and where the Rule is silent, it need not necessarily be deemed that the Rule prohibits the claim of right, which the statute enjoins. Rule 21 of the Jharkhand Shops & Establishments Rules does prescribe the procedure for filing a complaint under Section 26 of the Act, in cases where the termination of an employee is by way of dismissal or discharge. Merely because the Rule is silent and does not attach the expression otherwise terminated, it would not be deemed that the Rules prohibit filing of a complaint under Section 26 of the Act by an employee, whose services were otherwise terminated. Rather, it has to be deemed that the prescribed procedure as laid down in Rule 21 of the Rules, includes a circumstance where the employee s services is otherwise terminated. Reading the Rule otherwise, would be contrary to the Statute. In the case of Krishna Chandra Yadav (Supra), though the issues of otherwise termination was not called upon for consideration but the facts of the case did indicate that it was a case of otherwise termination of service without issuance of any formal order of dismissal. The complaint filed by the writ petitioner, therein, under Section 26 of the Act was found maintainable, and the Division Bench of this Court had confirmed the order of the labour court. In my opinion, therefore, the complaint of the petitioner as filed under Section 26 of the Bihar (Jharkhand) Shops & Establishments Act, cannot be dismissed merely on the ground that the corresponding Rule 21 of the Jharkhand Shops & Establishments Rules, do not provide for the case of otherwise termination. 13. The next issue is whether the finding of the court below that the petitioner s complaint under Section 26 of the Act, is barred by limitation, suffers from any impropriety?

10 [10] Admittedly, on account of stoppage of supply of L.P.G. Gas by the Indian Oil Corporation, the Respondent-Society could not continue its business operations of distribution of L.P.G. Gas and there was no prospect of revival of the business in the near future and this situation continued for more than three years. These facts amply demonstrate that the Respondent-society had suffered closure of its business and it could not, therefore, provide any employment to any of its employees. The closure of the business came to the petitioner s knowledge even only on the date, when the Gas Agency Business operations were closed down by the Respondents and he was not offered any work, from the date when the business of the Respondent was closed indefinitely. The cause of action for the purposes of filing a complaint under Section 26 of the Bihar (Jharkhand) Shops & Establishments Act, accrued, if any, to the petitioner on the day when he was not offered any work after the closure of the Respondent s Gas Agency Business. The complaint therefore under Section 26 of the Act, ought to have been filed within the period of limitation period of 90 days. The petitioner s complaint was filed after about three years of the date of the termination of his service. Though, the petitioner did not make any prayer for condonation of inordinate delay but he had wanted to explain that he had preferred a conciliation proceeding before the Deputy Labour Commissioner and it was only after being advised by the Deputy Labour Commissioner that he had filed the complaint. The other explanation sought to be advanced by the petitioner is that during the period when the Gas Agency business of the Respondent-society was remained closed, he was given some subsistence allowance by the Administrator, who was made in-charge of the Establishment of the Respondent- Society. The payments of some subsistence allowance, even if made by the Administrator, was declared as illegal by the Auditor on the ground that the Administrator had no authority to disburse such payments to any of the employees of the establishment of the Respondent-society during the period when the business remained closed. Such payments of subsistence allowance, even if made, cannot confer any right of claim upon the petitioner. Furthermore, such subsistence allowance, as per the petitioner s own admission, was made for a few months only and not during the entire period when the employer s business remained closed. On this issue the explanations offered by the petitioner, do not give adequate reasons for the delay in filing the complaint and in this view of the matter, the finding of the court below that the complaint of the petitioner is barred by limitation, does not call for any interference. 14. As to the next contention of the petitioner that the court below ought to have given its finding on two core issues, (i) whether the complainant

11 [11] has been in continuous employment for a year or not? and (ii) whether the complainant, was gainfully employed during the period of suspension of the Respondent s business? Neither of these two issues are relevant in the light of the pleadings of the parties and the facts and circumstances of the case, which indicate that the business of the Respondents was closed and therefore, no compensation could be claimed by its employees on account of termination of their service. 15. In the light of the above discussions, I do not find any merit in this writ application. Accordingly, this writ application is dismissed. APK/AFR (D.G.R. Patnaik, J.)

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