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CASE NO.: Appeal (civil)  1839 of 2005

PETITIONER: Muir Mills Unit of N.T.C. (U.P) Ltd.

RESPONDENT: Swayam Prakash Srivastava & Anr.

DATE OF JUDGMENT: 01/12/2006

BENCH: Dr. AR. Lakshmanan & Altamas Kabir

JUDGMENT: JUDGMENT

Dr. AR.Lakshmanan, J.        The appellant in the present matter is Muir Mills a  subsidiary of the National Textile Corporation Ltd. of  State of Uttar Pradesh. The respondent No.1 was offered  appointment as Legal Assistant in the litigation section  on a probation period of 1 year (in the pay scale of Rs.  330-560) on 04.06.1982. The appointment letter stated  that the said appointment was on a probationary basis.  The period of probation was set at one year from the date  of joining. On 12.06.1982, the respondent No.1 joined his  duties.        On 23.11.1982, a letter was written by the Senior  Legal Assistant to the General Manager of the Mill stating  that respondent No.1 had completed 6 months of  probation but was not able to understand fully the work  of his post and stated that "His work is not up to the  mark; therefore he is of no use to us". However, it was  decided to give the respondent No.1 an opportunity to  improve his performance. It is the case of the appellants  that the respondent No.1 was orally informed about the  above decision of the appellants.       On the expiry of the probation period of the  respondent No.1, a letter dated 04.06.1983 was issued to  the respondent No.1 stating that, "Your performance has  not been found satisfactory and as such, you have failed  to complete the probationary period successfully".        On 06.02.1985, respondent No.1 raised an industrial  dispute which was referred for adjudication by  respondent No.2 the State of Uttar Pradesh, to the  Labour Court in the following terms, "Is termination of  the services of the workman Swayam Prakash Srivastava  (son of Hori Lal Srivastava), Legal Assistant by the  employers vide their order dated 04.06.1983 is right  and/or legal? If not, the concerned workman is entitled  to which benefit/relief and along with which other  details." On 25.05.1987, the Labour Court delivered an  award holding that, the respondent No.1 was a workman  and the termination was illegal and that respondent No.1  has to be reinstated within a month of the order with  backwages. The Labour court also observed that the  Industrial adjudicator had no power to examine the  validity of the termination of the services of a probationer  before the completion of probation period. Aggrieved by this order of the Labour Court, the  appellant preferred a writ petition being WP No.22193  before the High Court of Judicature, Allahabad

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challenging the award of the Labour Court dated  25.05.1987. By an interim order dated 02.12.1987, the  High Court stayed the operation of the award of the  Labour Court subject to the deposit of one half of the  decreed backwages. The appellant was also directed to  continue to make payment of the future salary of  respondent No.1 till further orders.  The respondent No.1  was given the liberty to withdraw the backwages upon  furnishing security. The future salary be withdrawn by  respondent No.1 without any security. The appellants  complied with the order of the High Court immediately. Muir Mills ceased to be operational in 1991. In the  period 1992-1993, the appellants referred to the Board of  Industrial and Financial Reconstruction (’BIFR’) under  the Sick Industrial Companies (Special Provisions) Act  (’SICA’).  On 05.02.2002 the National Textile Corporation  (UP) Ltd, of which the appellants is a constituent entity  was declared as a sick industrial company under the  SICA and 9 of the 11 mills owned by the said company  was directed to be closed. On 01.11.2002, the High Court dismissed the writ  petition No.22193 of 1987 holding that the High Court  will not interfere with the order of the Labour court as  the same has neither been shown to be perverse, nor  suffering from any error of law.  By letter dated 9/11.03.2004, the Ministry of  Labour, Government of India approved the formal closure  of Muir Mills.  However, on 20.04.2004, the appellant company  received a show cause notice from the Deputy Labour  Commissioner asking the appellant to explain why a  recovery certificate of over ten lakhs be not issued in  favour of respondent No.1.  An SLP was filed by the appellant on 16.07.2004  challenging the order of the High Court dated  01.11.2002. The issues that deserve to be settled by this court  according to us are:  1.      Whether ’legal assistant’ falls under the  definition of workman under the Industrial  Disputes Act? 2.      Whether the High Court failed to appreciate that  the award was perverse inasmuch as it directed  the reinstatement with backwages of a  probationer whose services had been  discontinued upon completion of the  probationary period on account of  unsatisfactory work? 3.      Whether the High Court failed to appreciate that  respondent No.1 having worked as a probationer  for just a year had enjoyed over 15 years of  wages without having worked for the same and  that in the facts and circumstances even if the  termination was held to be illegal, these wages  paid should have been held to be treated as  compensation in lieu of reinstatement? The appellant Mill was represented before us by  learned counsel Mr.Sanjay Ghose, assisted by Ms. Anitha  Shenoy, advocate. Mr. Bharat Sangal, learned counsel  appeared for the respondents. The appellants stated that respondent No.1 was not  a workman as understood under the Industrial Disputes  Act.  The respondent No.1 was being paid a sum of       Rs. 866.51 as salary and his work was essentially of  supervisory nature. The nature of respondent No.1, Mr.

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Swayam Prakash Srivastava’s work was to supervise the  court cases and conduct them in the courts for the  appellant Mill.    It was submitted on behalf of the appellants that  the High Court failed to appreciate that the award of the  Labour Court was perverse as it directed the  reinstatement with backwages of a probationer whose  services had been discontinued upon completion of the  probationary period on account of unsatisfactory work. In  this regard the learned counsel referred to this Court’s  decision in the case of Pavanendra. Narayan. Verma  vs. Sanjay Gandhi PGI of Medical Studies & Anr  (2002) 1 SCC 520, where it was held that the services of  a probationer can be terminated at any time before  confirmation, provided that such termination is not  stigmatic.  Learned counsel submitted that the High Court  failed to appreciate that the award of the Labour Court  was also perverse as it had directed grant of backwages  without giving any finding on the gainful employment of  respondent No.1 and held that the discontinuance of the  services of a probationer was illegal without giving any  finding to the effect that the disengagement of respondent  No.1 was in any manner stigmatic. The decision in the  case of MP State Electricity Board vs. Jarina Bee  (Smt)  (2003) 6 SCC 141 was cited in this regard where it  was held that payment of full back wages was not the  natural consequence of setting aside an order of  reinstatement.  In the instant case, though the  termination was as far back as in 1983, the Industrial  Adjudicator has not given any finding on unemployment.  It was submitted that the respondent No.1 had been  receiving interim wages for over 15 years without having  worked at all and without having established his  unemployment. The High Court failed to appreciate that  the award itself had only granted reinstatement to  respondent No.1 as a probationer giving the petitioner  the right to take a decision on confirmation.   The High Court failed to appreciate that respondent  No.1 having worked as a probationer for just a year had  enjoyed over 15 years of wages without having worked for  the same and that in the facts and circumstances even if  the termination was held to be illegal, these wages paid  should have been held to be treated as compensation in  lieu of reinstatement. The appellants further contended that, assuming  but not conceding that the termination of the service of  respondent No.1 was illegal, given the fact that all that  the Labour Court directed was that the respondent be  reinstated as a probationer and given the fact that the  Mill itself had been closed down and the appellant  declared a Sick Industrial Company in respect of which a  revival scheme was sanctioned, the decision of this court  in Rolston John vs. Central Government Industrial  Tribunal-cum-Labour Court & Ors., 1995 Suppl (4)  SCC 549 would be applicable and the logical relief would  be to be compensated in lieu of reinstatement, which in  the given case could be deemed to set off and satisfied by  the payment received by respondent No.1 of wages  pursuant to the interim order of the High Court dated  02.12.1987. It was further submitted that the huge financial  liability of Rs.7 lakhs in wages to a probationer who had  worked for only about a year was something which the  appellant, being a Sick Industrial Company, would find

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impossible to bear and if this liability is saddled upon the  appellant, it could prejudice the sanctioned scheme for  revival of two remaining mills.  Almost 6898 employees  have been retired under a voluntary retirement scheme. That the High Court erred in dismissing the writ  petition of the appellant on the ground that the appellant  had not complied with the interim order of the High  Court whereas the appellant mill has complied with order  dated 2.12.1987 for payment of half of the decreed  backwages as early as on 19.1.1988.   Concluding his arguments the learned counsel  submitted that, the NTC (UP) Ltd. was managing 11  nationalised textile mills in the State of Uttar Pradesh.  On account of huge losses, obsolete technology, excess  labour/staff force the company was referred to the Board  for Industrial and Financial Reconstruction (BIFR) under  the Sick Industrial Companies (Special Provisions) Act in  the year 1992-1993.  The IFCI has prepared a Revival  Scheme on the basis of which the BIFR has approved of a  sanctioned scheme.  Under the Scheme, 9 of the 11 mills,  including the Muir Mills where respondent No.1 had  served as a probationer, have been closed down.  About  6898 employees have opted for VRS. The High Court  failed to appreciate that the petitioner-Company itself  had been declared a Sick Industrial Company and the  Muir Mills wherein the respondent worked had been  closed down and the reinstatement in any event was an  impossibility. That the claim had been raised by the respondent, a  probationer who had served for only one year and who  has already received wages for over 15 years amounting  to Rs.2.5 lakhs despite no entitlement to the same under  law and without any proof of unemployment during this  period.  If a recovery certificate of over Rs. 10 lakhs is  allowed to be issued in favour of respondent No.1 then  the appellant already staggering under a huge financial  liability which the appellant, being a Sick Industrial  Company would find impossible to bear and if this  liability is saddled upon the appellant, it could seriously  prejudice the sanctioned scheme for revival of two  remaining mills affecting the future of about 3000  employees who have been labouring day and night in the  remaining mills to make the Revival Scheme a success. The respondents submitted that the respondent  No.1 was appointed as Legal Assistant in the appellant’s  organization where he worked with full devotion, sincerity  and to the full satisfaction of the employers but his  services were terminated on 04.06.1983 without any  reason. It was submitted that, respondent No.1 was on  leave on 04.06.1983 and 05.06.1983 (being a Sunday)  and on 06.06.1983 when he went for work he was given  the termination order.  Respondent No.1 was not issued  a charge sheet or notice during the period before the  termination of his services. It was contended that respondent No.1 was  appointed as legal assistant but he was not doing any  work of supervisory nature and that no body was working  under him. Further it was contended that respondent  No.1 used to do parokari on behalf of the Mills and that  this type of work cannot be called as work of supervisory  nature and therefore respondent No.1 will qualify to be  workman as defined under section 2(z) of the U.P.  Industrial Disputes Act (U.P.I.D Act), 1947. It was stated that the termination order comes  under the definition or retrenchment and the employers

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have not followed the legal process. The workman has  stated that the termination order comes under the  definition of retrenchment under section 2 of the  U.P.Industrial Disputes Act. The definition of  retrenchment is very elaborate in this section and in this  connection a decision of this court was cited, Karnataka  State Road Transport Corporation, Bangalore vs.  Abdul Qadir which appears on page 89 F.L.R. \026 1984- 48, where it was observed that, "To protect the weak  against the strong this policy of comprehensive definition  has been effectuated. Termination embraces not merely  the act of termination by the employer but the fact of  termination howsoever produced. We are inclined to hold  that the stage has come when the view indicated in  Money’s case has been ’absorbed into the consensus’ and  there is no scope for putting the clock back or for an  anticlockwise operation. Once the conclusion is reached  that retrenchment as defined in section 2(oo) of the  Industrial Disputes Act covers every case of termination  of service except those which have been embodied in the  definition, discharge from employment or termination of  service of a probationer would also amount to  termination." It was also contended that there was no evidence  whatsoever to prove that the workman (respondent No.1)  was given any warning during the period of his service for  his unsatisfactory work and therefore terminating his  services without a reasonable notice is wrong under law. The respondents further contended that in the  present fact scenario retrenchment is bad under law as  conditions under section 6-N is not complied with.  Section 6-N of the U.P. Industrial Disputes Act, 1947,  states 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-

a)      The workman has been given one month’s  notice in writing indicating the reasons for  retrenchment and the period of notice has  expired or the workman has been paid in  lieu of such notice wages for the period of  notice:

Provided that\005.,

b)      The workman has been paid, at the time of  retrenchment, compensation which shall be  equivalent to fifteen days’ average pay for  every completed year of service or any part  thereof in excess of six months\005"     

Therefore, it was submitted that backwages have to  be paid to the retrenched workman. The learned counsel  cited a string of cases in support of this contention made  before us, Surendra Kumar Verma Etc vs. Central  Government Industrial Tribunal-cum- Labour Court,  New Delhi & Anr., 1981 (1) SCR 789, Hindustan Tin  Works Pvt. Ltd. vs. Employees of Hindustan Tin  Works Pvt. Ltd., 1979 (1) SCR 563, Mohan Lal vs.  Mgmt of M/s. Bharat Electronics Ltd, (1981) 3 SCC  225, Post Graduate Institute of Medical Education  and Research, Chandigarh vs. Vinod Krishan  Sharma & Anr (2001) 2 SCC 59, J.N.Srivastava vs.

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Union of India 1998(9) SCC 559 and Jitendra Singh  Rathor vs. Shri Baidyanath Ayurved Bahwan Ltd &  Anr., 1984 3 SCR 223 where this court has consistently  held that in case  of illegal termination of service of a  workman, the workman is deemed to be continuing in  service and is entitled to reinstatement with full  backwages. We heard the parties in detail and have perused  through all the written records placed before us. We are  of the opinion that the arguments of the appellant merits  favourable consideration for the reasons stated infra. With regard to the question, whether respondent  No.1 is a ’workman’ under the U.P.I.D Act, 1947, we are  of the view that respondent No.1 is not a workman under  the Industrial Disputes Act. Section 2(z) of the U.P.I.D  Act that is similar to section 2 (s) of the Industrail  Disputes Act, 1947 states that:        "’Workman’ means any person (including an  apprentice) employed in any industry to do any  skilled or unskilled manual, supervisory, technical  or clerical work for hire or reward, whether the  terms of employment be express or implied, and  for the purposes of any proceeding under this Act  in relation to an industrial dispute, includes any  such person who has been dismissed, discharged  or retrenched in connection with, or as a  consequence of, that dispute, or whose dismissal,  discharge or retrenchment has led to that dispute,  but does not include any such person-

i)      xxx ii)     xxx iii)    who is employed mainly in a managerial or  administrative capacity; or

iv)     who, being employed in a supervisory  capacity, draws wages exceeding five  hundred rupees per mensem or exercises,  either by the nature of duties attached to the  office or by reason of the powers vested in  him, functions mainly of a managerial  nature."

In the fact situation of this case, from the perusal of  the job profile of respondent No.1 and after examining  section 2 (z) of the U.P.I.D Act it can be said that,  respondent No.1 did not fall into the category of workman  as contended by the respondents as respondent No.1  falls under exception (iv) of section 2 (z) of the U.P.I.D  Act, 1947.  The case of Sonepat Cooperative Sugar Mills Ltd.  v. Ajit Singh (2005) 3 SCC 232, can be referred to in this  context. Here the respondent was appointed to the post  of "Legal Assistant" the qualification for which was degree  in law with a practicing licence. The nature of his duties  was to prepare written statements and notices, recording  enquiry proceedings, giving opinions to the management,  drafting, filing the pleadings and representing the  appellant in all types of cases. He was also conducting  departmental enquiries against workmen in the  establishment. He was placed in probation and his post  was dispensed with, following which he was terminated.  He raised an industrial dispute.  The question before the Labour Court was "Whether  the applicant was a workman"; Labour Court held he was

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a workman, which was upheld by High Court,  Management preferred an appeal to this Court. Following  the decisions of this Court in    A Sundarambal v. Govt.  of Goa, Daman and Diu (1988) 4 SCC 42, HR  Adyanthaya v. Sandoz (India) Ltd.   AIR 1994 SC 2608  and rejecting SK Verma v. Mahesh Chandra (supra),  this Court held:  "Thus, a person who performs one or the other  jobs mentioned in the aforementioned provisions  only would come within the purview of the  definition of workman. The job of a clerk ordinarily  implies stereotype work without power of control  or dignity or initiative or creativeness. The  question as to whether the employee has been  performing a clerical work or not is required to be  determined upon arriving at a finding as regards  the dominant nature thereof. With a view to give  effect to the expression to do ’any manual,  unskilled, skilled, technical, operational, clerical  or supervisory work’, the job of the employee  concerned must fall within one or the other  category thereof. It would not be correct to  contend that merely because the employee had not  been performing any managerial or supervisory  duties, ipso facto he would be a workman"  

      "...The Respondent had not been performing any  stereotype job. His job involved creativity. He not  only used to render legal opinion on a subject but  also used to draft pleadings on behalf of the  appellant as also represent it before various  courts/authorities. He would also discharge quasi- judicial functions as an enquiry officer in  departmental enquiries against workmen. Such a  job, in our considered opinion, would not make  him a workman."  

In A Sundarambal v. Govt. of Goa, Daman and Diu  (supra), question arose as to whether a teacher employed  in a school is a ’workman’ under s.2(s), here this Court  was of the opinion that:  "The teachers employed by educational  institutions, whether the said institutions are  imparting primary, secondary, graduate or  postgraduate education cannot be called as  ’workmen’ within the meaning of s.2(s) of the Act.  Imparting of education which is the main function  of teachers cannot be considered as skilled or  unskilled manual work or supervisory work or  technical work or clerical work. Imparting of  education is in the nature of a mission or a noble  vocation. The clerical work, if any they may do, is  only incidental to their principal work or teaching.  It is not possible to accept the suggestion that  having regard to the object of the Act, all  employees in an industry except those falling  under the exceptions (i)-(iv) in s.2(s) of the Act  should be treated as workmen as it will render the  words, "to do any skilled or unskilled, manual,  supervisory, technical or clerical work"  meaningless. Therefore, the appellant teacher of  the school conducted by ... was not a workman,  though the school was an industry, in view of the  definition of ’workmen’ as it now stands."

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It can be observed that even before the Labour  Court as a preliminary objection, it was contended by the  appellant that, the respondent No.1 was not under the  category of workman as defined in section 2 of the U.P.  Industrial Disputes Act, 1947. Hence the reference order  is not covered under the U.P. Industrial Disputes Act,  1947; and the reference order is totally vague, bad in law  and is liable to be rejected. It was also stated before the  Labour Court that the total emoluments for the month of  April, 1983 drawn by Sri Srivastava were totally in his  supervisory capacity and he was designated as Legal  Assistant in the Litigation Department of the Mill and  therefore the reference before the Labour Court is not  maintainable. Before the Labour Court the respondent was  examined as W.W-I. In his deposition in-chief, he stated  on oath that, on 04.06.1982 he was appointed as the  legal assistant in the Mill. In the cross-examination he  stated that he was appointed in the post of Legal  Assistant in the Mill and a total of Rs 850/- per mensem  was being paid as salary. One Mr. Naresh Pathak was  examined as E.W.-I, he deposed on oath that he was  working as Senior Legal Assistant since 1971 and that  the respondent had worked in his department in the post  of Legal Assistant in June 1982 in a supervisory capacity  and the work of the respondent No.1 was to supervise the  court cases and whenever necessary to prepare draft  reply to matters that are pending in the court. He also  deposed that the work of the respondent was not  satisfactory and in this regard a note was issued to the  General Manager. In cross-examination the witness  deposed that he has no document to prove that the  nature of work of the respondent was supervisory.  However this was not given any kind of serious  consideration by the High Court while deciding on the  claim made by the respondents.    Furthermore if we draw a distinction between  occupation and profession we can see that an  occupation is a principal activity (job, work or calling)  that earns money (regular wage or salary) for a person  and a profession is an occupation that requires  extensive training and the study and mastery of  specialized knowledge, and usually has a professional  association, ethical code and process of certification or  licensing. Classically, there were only three professions:  ministry, medicine, and law. These three professions  each hold to a specific code of ethics, and members are  almost universally required to swear some form of oath to  uphold those ethics, therefore "professing" to a higher  standard of accountability. Each of these professions also  provides and requires extensive training in the meaning,  value, and importance of its particular oath in the  practice of that profession. A member of a profession is termed a professional.  However, professional is also used for the acceptance of  payment for an activity. Also a profession can also refer  to any activity from which one earns one’s living, so in  that sense sport is a profession. Therefore, it is clear that respondent No.1 herein is  a professional and never can a professional be termed as  a workman under any law. The perusal of the appointment order becomes  useful here for addressing the issue whether the High  Court failed to appreciate that the award of the Labour  Court was perverse as it directed the reinstatement with

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backwages of a probationer whose services had been  discontinued upon completion of the probationary period  on account of unsatisfactory work  "MUIR MILLS         UNIT OF NATIONAL TEXTILE CORPORATION (U.P) Ltd. SUBSIDIARY  OF NATIONAL TEXTILE CORPN. Ltd. NEW DELHI

(A GOVERNMENT OF INDIA UNDERTAKING) Post Box No.33, Civil Lines, Kanpur-208 001 Dated: 4th June, 1982                Ref No.       Sri. Swayam Prakash Srivastava,       S/o Sri. Hori Lal Srivastava,       21/8, Safed Colony, Juhi       Kanpur

     Dear Sir,

       With reference to your application dated 24.05.1982      and subsequent interview you had with us on  27.05.1982, we have pleasure in offering you the post of  Legal Assistant in the pay scale of Rs.330-10-380-EB-12- 500-EB- 15-560/- with a starting basic pay of Rs.330/-  (Rupees Three hundred Thirty only) per month with effect  from the date of your joining the Mills, on the following  terms and conditions:-       1\005.       2\005.                3. You will be on probation for a period of one year from    the date of your joining the Mills. The probation period of  one year can be extended or curtailed at the discretion of  the appointing authority. In the event of your failure to  complete the said probationary period satisfactorily, you  may render yourself liable to be discharged from the  service of the Mill without assigning any reasons and  without any notice. During the period of probation, you  can resign from the service of the Mill without giving any  notice. Unless a letter is issued to you to the effect that  you have completed your probation satisfactorily, the  probation period shall be deemed to have been extended.  No increment shall be granted to you unless you have  completed the said probationary period satisfactorily and  a letter to this effect has been issued to you.

4. After you having completed the probation satisfactorily,  your services can be terminated by the appointing  authority on giving you one month’s notice or pay in lieu  thereof. If you wish to resign from the service of the Mill,  you will have to give one month’s notice or pay in lieu  thereof to the Mill.        5\005. 6. Your employment will be governed by all the rules and  regulations, terms and conditions of service,  administrative orders and/or standing orders presently in  force or as may be framed, amended, altered or extended  from time to time and as applicable to the employees of  the Mills.       7\005.       8\005.       9\005.      10\005.

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    11\005.          12. On attaining the age of 58 years, you shall have no  claim to be continued in the service of the Mill thereafter  and your services shall come to an end automatically.      13\005.      14\005. Yours faithfully (for) Muir Mills Unit of NTC (UP) Ltd. (A.L. MATHUR) General Manager"

Also if we peruse through the termination order it is  clear that the respondent No.1 was appointed in the  capacity of legal Assistant and his services were  terminated after the completion of the probationary  period. 4th June, 1983 Shri Swayam Prakash Srivastava,       Legal Assistant,        Muir Mills       Kanpur

Reference para 3 of appointment letter No.  PA/16/82 dated 4th June, 1982.

Your performance has not been found satisfactory  and as such, you have failed to complete the  probationary period successfully. Your services are,  therefore, being terminated with immediate effect.

Please contact Accounts Dept. on any working day  and get your dues cleared on production of a ’No  Demand Certificate’ from all the concerned.

For Muir Mills Unit of NTC (U.P) Ltd.     

It is clear from the clause in the appointment letter  and the termination letter that, the Mill had reserved all  rights to discharge from the service of the Mill the  respondent No.1 without assigning any reasons and  without any notice.

Also in the case of Registrar, High Court of  Gujarat & Anr vs. C.G.Sharma (2005) 1 SCC 132, it  was observed that an employee who is on probation can  be terminated from services due to unsatisfactory work.

This Court’s decision in the case of P.N. Verma vs.  Sanjay Gandhi PGI of Medical Studies (supra), can be  referred to in this context, where it was held by this court  that, the services of a probationer can be terminated at  any time before confirmation, provided that such  termination is not stigmatic. This Court in State of  Madhya Pradesh vs. VK Chourasiya 1999 SCC (L&S)  1155 also has held that in the event of a non-stigmatic  termination of the services of a probationer, principles of  audi alteram partem are not applicable.

We are also of the view that the award of the Labour  Court is perverse as it had directed grant of backwages  without giving any finding on the gainful employment of  respondent No.1 and held that the discontinuance of the

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services of a probationer was illegal without giving any  finding to the effect that the disengagement of respondent  No.1 was in any manner stigmatic. The decision in the  case of MP State Electricity Board vs. Jarina Bee  (Smt) (supra), this court held that payment of full back  wages was not the natural consequence of setting aside  an order of reinstatement.  In the instant case, though  the termination was as far back as in 1983, the  Industrial Adjudicator has not given any finding on  unemployment. This Court in a recent case of State of  Punjab vs. Bhagwan Singh (2002) 9 SCC 636 has held  that even if the termination order of the probationer  refers to the performance being ’not satisfactory’, such an  order cannot be said to be stigmatic and the termination  would be valid.

Further the Labour Court issued notices to both  parties and after adducing evidence and hearing both the  parties, it has recorded a finding that the termination of  services of the concerned workman, during his service,  was neither based on unsatisfactory work nor the same  could have been proved before the labour court and  therefore, the labour court arrived at the conclusion and  recorded a finding that the services of the workman have  been terminated by way of victimization and unfair  labour practice. Aggrieved by the aforesaid award, the  employer-petitioner has come before this court by means  of the present writ petition. An application has been filed  by the workman concerned that the employer has not  complied with the aforesaid interim order.    

However, we are of the view that, the emoluments  for the month of April, 1983 drawn by respondent No.1  was Rs.866.51 and the nature of duties of respondent  No.1 were totally supervisory capacity and he was  designated as Legal Assistant in the Mill’s litigation  department. So the respondent is not entitled to raise an  Industrial Dispute and also that his services are governed  by all the rules and regulations, terms and conditions of  service, administrative orders and/or standing orders  presently in force or as may be framed, amended, altered  or extended from time to time and as applicable to the  employees of the Mills as is clear from the appointment  order of 04.06.1982. Also it is clear from the facts that  the appellants have complied with the interim order of  the High Court.  

We also observe that the respondent No.1 had been  receiving interim wages for over 15 years without having  worked at all and without having established his  unemployment. The High Court failed to appreciate that  the award itself had only granted reinstatement to  respondent No.1 as a probationer giving the petitioner  the right to take a decision on confirmation. Further the  Mill itself has been shut down now and given the lapse of  22 years, it was impracticable to reinstate respondent  No.1 as a probationer.  

It is also pertinent to mention Section 2(oo) of the  Industrial Disputes Act. Section 2 (oo) of the I.D.Act,  1947 states that,

"2. (oo) "retrenchment" means the termination  by the employer of the service of a workman  for any reason whatsoever, otherwise than as a

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punishment inflicted by way of disciplinary  action but does not include-

(a) Voluntary retirement of the workman; or                (b) Retirement of the workman on reaching the  age of superannuation if the contract of  employment between the employer and the  workman concerned contains a stipulation in  that behalf; or

(bb)\005

(c )\005"

However, this provision is not applicable to the U.P.  Industrial Disputes Act, 1947.  

With regard to the contention of the respondents  that in the present fact scenario retrenchment is bad  under law as conditions under section 6-N, which talks  about a reasonable notice to be served on an employee  before his/her retrenchment, is not complied with; we are  of the view that an even under Section 6-N, proviso states  that ’no such notice shall be necessary if the  retrenchment is under an agreement which specifies a  date for the termination of service." In the present case  on the perusal of the appointment letter it is clear that no  such notice needs to be issued to respondent No.1.

The respondents had referred to many cases with  regard to backwages to be paid to the retrenched  workman. The learned counsel cited a string of decisions  of this court in support of this contention. We are  however not addressing this plea of the respondents, as  we have already observed that respondent No.1 is not a  workman under the Industrial Disputes Act, 1947 and  the U.P.I.D Act, 1947 and also that the retrenchment was  not illegal and therefore the question of backwages do not  arise.

In the result, we allow the appeal preferred by the  appellants and set aside the award of the Labour Court  and the orders of the High Court. We also observe that no  recovery certificate needs to be issued in favour of  respondent No.1, in lieu of the show cause notice issued  by the Deputy Labour Commissioner. However we state  that the salary that has been already paid to respondent  No.1 under the orders of the court will not be recovered  from the respondent. The High Court while passing the  interim order dated 02.12.1997 in writ petition No. 193 of  1997 while granting stay of the award of the Labour  Court directed the Management to deposit half of the  amount decreed and also continue to deposit the amount  of salary of respondent in future until further orders and  that the past award if deposited could be withdrawn by  the workman after furnishing security.  However, no  security need be given to the withdrawal of the amount  which is to be deposited as future salary.  

In view of our finding that the respondent is not a  workman, he will not be entitled to payment of half of the

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decreed amount which was ordered to be deposited.  If  the amount has not been withdrawn so far, the  Management is at liberty to withdraw the same from the  court deposit. However we are not ordering costs.