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CASE NO.: Appeal (civil)  7304 of 2005

PETITIONER: U.P. State Brassware Corpn. Ltd. & Anr.                  

RESPONDENT: Udai Narain Pandey                                               

DATE OF JUDGMENT: 08/12/2005

BENCH: S.B. Sinha & P.K. Balasubramanyan

JUDGMENT: JUDGMENT [Arising out of  S.L.P. (C) No. 14945 of 2004]

S.B. Sinha, J :  

       Leave granted.

        Whether direction to pay backwages consequent upon a declaration  that a workman has been retrenched in violation of the provisions of Section  6-N of the U.P. Industrial Disputes Act, 1947 (equivalent to Section 25F of  the Industrial Disputes Act, 1947) as a rule is in question in this appeal  which arises out of a judgment and order dated 6.2.2004 passed by a  Division Bench of the High Court of Judicature at Allahabad in Civil Misc.  Writ Petition No. 23890 of 1992 dismissing the appeal preferred by the  Appellant herein arising out of a judgment and order dated 8th July, 1992.

       The Appellant is an undertaking of the State of Uttar Pradesh.  The  Respondent herein was appointed on 23rd July, 1984 in a project known as  Project Peetal Basti by the Appellant for looking after the construction of  building, cement loading and unloading.  He worked in the said project from  23.7.1984 till 8.1.1987.  He was thereafter appointed in Non-Ferrous Rolling  Mill.  By an order dated 12/13.2.1987, the competent authority of the Non- Ferrous Mill of the Appellant passed the following order:

"Following two persons are hereby accorded  approval for appointment in Non-Ferrous Rolling  Mill on minimum daily wages for the period w.e.f.  date indicated against their name till 31-3-1987.

Sl No.          Name                            Date 1.              Sh. Hori Lal                    7-1-1987 2.              Sh. Uday Narain Pandey  8-1-1987"

       The services of the Respondent were terminated on the expiry of his  tenure.  An industrial dispute having been raised, the appropriate  government by an order dated 14.9.1998 referred the following dispute for  adjudication by the Presiding Officer, Labour Court, Uttar Pradesh:

"Whether the employer’s decision to terminate the  Workman Sh. Uday Narain son of Pateshwari  Pandey w.e.f. 1-4-87 was illegal and improper? If  yes whether the concerned workman is entitled to  the benefit of retrenchment and other benefit?"

       The Project Officer of the Appellant-Corporation appears to have

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granted a certificate showing the number of days on which the Respondent  performed his duties.   

       The Labour Court in its award dated 31.10.1991 came to the finding  that the Respondent worked for more than 240 days in each year of 1985- 1986.   It was directed:

"Therefore, I reached to the decision that the  employer should reinstate the concerned workman  Uday Narain Pandey son of Sh. Pateshwari Pandey  w.e.f. the date of retrenchment i.e. 1-4-87 and he  should be paid entire backwage with any other  allowances w.e.f. same date within 30 days from  the date of this order together with Rs. 50/-  towards cost of litigation to Sh. Uday Narain  Pandey.  I decide accordingly in this Industrial  Dispute."

       The Appellant herein filed a writ petition before the Allahabad High  Court in May, 1992 which was marked as Civil Misc. Writ Petition No.  23890 of 1992 inter alia contending that as the Respondent had not rendered  service continuously for a period of 240 days during the period of 12  calendar months immediately before his retrenchment uninterruptedly, he  was not a workman within the meaning of Section 2(z) of the U.P. Industrial  Disputes Act.  It was further contended that the appointment of the  Respondent was on contractual basis for a fixed tenure which came to an end  automatically as stipulated in the aforementioned order dated 12/13.2.1987.

       An application was filed by the Respondent herein under the Payment  of Wages Act wherein an award was passed.  The said order was also  questioned by the Appellant by filing a writ application before the High  Court and by an order dated 12.8.1993, the High Court directed it to pay a  sum of rupees ten thousand to the Respondent.  Pursuant to or in furtherance  of the said order, the Respondent is said to have been paid wages upto  February, 1996.  By reason of the impugned order dated 6.2.2004, the writ  petition was dismissed holding:

"Having heard the learned counsel for the  Petitioners and having perused the record, I am of  the opinion that the aforesaid findings recorded by  the Labour Court cannot be said to be perverse.   The learned senior counsel then contended that the  Petitioner No. 1 i.e. U.P. State Brassware  Corporation Ltd. has been closed down.  Be that as  it may, the position of the Respondent workman  would be the same as that all the similar  employees and this cannot be a ground to set aside  the award of the Labour Court."

       Ms. Rachana Srivastava, learned counsel appearing on behalf of the  Appellant would bring to our notice that the Appellant’s industries have  been lying closed since 26.3.1993 and in that view of the matter, the Labour  Court as also the High Court committed a serious error in passing the  impugned judgment.  The appointment of the Respondent, the learned  counsel would contend, being a contractual one for a fixed period, Section 6- N of the U.P. Industrial Disputes Act would have no application.

       Relying on or on the basis of the principle of ’no work no pay’, it was  urged that for the period the Respondent did not work, he was not entitled to  any wages and as such the grant of back wages by the Labour Court as also  by the High Court is wholly illegal, particularly, in view of the fact that no  statement was made in his written statement filed before the Labour Court  that he was not employed with any other concern.  In any event, the

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Respondent was also not interested in a job.  In support of the  aforementioned contention, reliance has been placed on Kendriya Vidyalaya  Sangathan and Another v. S.C. Sharma, (2005) 2 SCC 363 and Allahabad  Jal Sansthan v.  Daya Shankar Rai and Another, (2005) 5 SCC 124.

       Mr. Bharat Sangal, learned counsel appearing on behalf of the  Respondent, on the other hand, would submit that Section 2 (oo)(bb) of the  Industrial Disputes Act, 1947 applies to the workmen working in the State of  Uttar Pradesh as there does not exist any such provision in the U.P.  Industrial Disputes Act.  It was conceded that in view of the fact that  establishment of the Appellant was sold out on 26.3.1993, the Respondent  may not be entitled to an order of reinstatement with full back wages but  having regard to the fact that his services were wrongly terminated with  effect from 1.4.1987, he would be entitled to back wages for the entire  period from 1.4.1987 till 26.3.1993 besides the amount of compensation as  envisaged under the U.P. Industrial Disputes Act.

       Payment of back wages, Mr. Sangal would urge, is automatic  consequent upon a declaration that the order of termination is unsustainable  for any reason whatsoever and in particular when it is found to be in  violation of the provisions of Section 6-N of the U.P. Industrial Disputes  Act.   

       It is not in dispute that the Respondent was appointed on daily wages.   He on his own showing was appointed in a project work to look after the  construction of building.   

       The construction of the building, the learned Labour Court noticed,  came to an end in the year 1988.  The reference by the appropriate  government pursuant to an industrial dispute raised by the Respondent was  made in the year 1990.

       A decision had been taken to close down the establishment of the  Appellant as far back on 17.11.1990 wherefor a Government Order, GO No.  395/18 Niryat-3151/90 dated 17.11.1990 was issued.  In its rejoinder  affidavit filed before the High Court, it was contended that the said GO was  implemented substantially  and all the employees including the regular  employees save and except some skeleton staff for winding up were  retrenched.  The Non Ferrous Mill of the Appellant was sold on 26.3.1993.

       The Labour Court in its impugned award has not arrived at any  finding that the order of appointment dated 8.1.1987 whereby the  Respondent was appointed afresh in the Non Ferrous Rolling Mill was by  way of unfair labour practice.  It is, however, true that the Appellant relying  on or on the basis of the aforementioned order dated 12/13.2.1987 in terms  whereof the Respondent’s services were approved for appointment in the  said mill on minimum daily wages for the period 8.1.1987 till 31.3.1987  terminated his services without giving any notice or paying salary of one  month in lieu thereof.  No compensation in terms of Section 6-N of the U.P.  Industrial Disputes Act was also paid.

       Before adverting to the decisions relied upon by the learned counsel  for the parties, we may observe that although direction to pay full back  wages on a declaration that the order of termination was invalid used to be  the usual result but now, with the passage of time, a pragmatic view of the  matter is being taken by the court realizing that an industry may not be  compelled to pay to the workman for the period during which he apparently  contributed little or nothing at all to it and/ or for a period that was spent  unproductively as a result whereof the employer would be compelled to go  back to a situation which prevailed many years ago, namely, when the  workman was retrenched.          It is not disputed that the Respondent did not plead that he after his  purported retrenchment was wholly unemployed.

       Section 6-N of the U.P. Industrial Disputes Act provides for service of

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one month notice as also payment of compensation to be computed in the  manner laid down therein.  Proviso to clause (a) of the said provision,  however, excludes the requirement of giving such notice in the event the  appointment was for a fixed tenure.

       Section 25B(2)(a) of the Industrial Disputes Act raises a legal fiction  that if a workman has actually worked under the employer continuously for  a period of more than 240 days during a period of twelve calendar months  preceding the date with reference to which calculation is to be made,  although he is not in continuous service, he shall be deemed to be in  continuous service under an employer for a period of one year.

       The Labour Court although passed its award relying on or on the basis  of the certificate issued by the Appellant, it did not hold that during the  preceding 12 months, namely, for the period 1st April, 1986 to 31st March,  1987 the workman had completed 240 days of service.  Unfortunately,  neither the Labour Court nor the High Court considered this aspect of the  matter in right perspective.

       No precise formula can be laid down as to under what circumstances  payment of entire back wages should be allowed.  Indisputably, it depends  upon the facts and circumstances of each case.  It would, however, not be  correct to contend that it is automatic.  It should not be granted mechanically  only because on technical grounds or otherwise an order of termination is  found to be in contravention of the provisions of Section 6-N of the U.P.  Industrial Disputes Act.

       Section 2(oo)(bb) of the Central Act as inserted by Industrial Disputes  Amendment Act, 1984 is as under:

"2. Definitions.\027In this Act, unless there is  anything repugnant in the subject or context,\027         *       *       * (oo) ’retrenchment’ means the termination by the  employer of the service of a workman for any  reason whatsoever, otherwise than as a punishment  inflicted by way of disciplinary action, but does  not include\027 (a) *** (b) *** (bb) termination of the service of the workman as a  result of the non-renewal of the contract of  employment between the employer and the  workman concerned on its expiry or of such  contract being terminated under a stipulation in  that behalf contained therein;"

       However, a similar provision has not been enacted in the U.P.  Industrial Disputes Act.

       The contention of the Appellant, as noticed hereinbefore, was that the  Respondent having been appointed for a fixed period was not entitled to any  compensation under the provisions of Section 6-N of the U.P. Industrial  Disputes Act.  But, in this connection our attention has been drawn to a 2- Judge Bench decision of this Court in Uttar Pradesh State Sugar Corporation  Ltd. v. Om Prakash Upadhyay [2002 (1) LLJ 241: (2002) 10 SCC 89]  wherein it was held that in view of Section 31(1) of Industrial Disputes  (Amendment and Miscellaneous Provisions) Act, 1956, the provisions of  Section 2(oo)(bb) of the Central Industrial Disputes Act would not be  applicable.  In that view of the matter, although no notice was required to be  service in view of the proviso to Clause (a) of Section 6-N of the U.P.  Industrial Disputes Act, compensation therefor as provided for in Clause (b)  was payable.  But, it is not necessary for us to go into the correctness or

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otherwise of the said decision as it is not disputed that before the provisions  of Section 6-N of the U.P. Industrial Disputes Act can be invoked, the  concerned workman must work at least for 240 days during a period of  twelve calendar months preceding the date with reference to which  calculation is to be made.   

       However, as the question as regard termination of service of the  Respondent by the Appellant is not in issue, we would proceed on the basis  that the services of the Respondent were terminated in violation of Section  6-N of the U.P. Industrial Disputes Act.  The primary question, as noticed by  us herein before, is as to whether even in such a situation the Respondent  would be entitled to the entire back wages.

       Before adverting to the said question in a bit more detail, let us  consider the decisions relied upon by Mr. Sangal.

       In Hindustan Tin Works Pvt. Ltd. v. Employees of Hindustan Tin  Works Pvt. Ltd. [(1979) 1 SCR 563], this court merely held that the relief of  reinstatement with continuity of service can be granted where termination of  service is found to be invalid.  It, therefore, does not lay down a law in  absolute terms to the effect that right to claim back wages must necessarily  follow an order declaring that the termination of service is invalid in law.

       In Hindustan Tin Works (supra) notice for retrenchment was issued  inter alia for non-availability of raw material to utilize the full installed  capacity, power shedding limiting the working of the unit to 5 days a week  and the mounting loss which were found to be factually incorrect.  The real  reason for issuing such a notice was held to be "the annoyance felt by the  management consequent upon the refusal of the workmen to agree to the  terms of settlement contained in the draft dated 5th April, 1974".

       Laws proverbial delay, it was urged therein, is a matter which should  be kept in view having regard to the fact situation obtaining in each case and  the conduct of the parties.  Such a contention was raised on the ground that  the company was suffering losses.  The court analysed factual matrix  obtaining therein to the effect that a sum of Rs. 2,80,000/- was required to be  paid by way of back wages and an offer was made by way of settlement to  pay 50% of the back wages observing:

"Now, undoubtedly the appellant appears to have  turned the corner. The industrial unit is looking up.  It has started making profits. The workmen have  already been reinstated and, therefore, they have  started earning their wages. It may, however, be  recalled that the appellant has still not cleared its  accumulated loss. Keeping in view all the facts and  circumstances of this case it would be appropriate  to award 75% of the back wages to the workmen to  be paid in two equal instalments."

       It will, therefore, be seen that this Court itself, having regard to the  factual matrix obtaining in the said case, directed payment of 75% of the  back wages and that too in two equal instalments.

       In Management of Panitole Tea Estate v. The Workmen [(1971) 3  SCR 774], a two-judge bench of this Court while considering the question as  regard grant of relief or reinstatement, observed:

"The general rule of reinstatement in the absence  of special circumstances was also recognised in the  case of Workmen of Assam Match Co. Ltd. v.  Presiding Officer, Labour Court, Assam and has  again been affirmed recently in Tulsidas Paul v.  Second Labour Court, W.B. In Tulsidas Paul it has

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been emphasised that no hard and fast rule as to  which circumstances would establish an exception  to the general rule could be laid down and the  Tribunal must in each case decide the question in a  spirit of fairness and justice in keeping with the  objectives of industrial adjudication."

                In Surendra Kumar Verma v. Central Government Industrial Tribunal- cum-Labour Court, New Delhi & Anr. [(1981) 1 SCR 789], this Court  refused to go into the question as to whether termination of services of a  workman in violation of the provisions of Section 25F is void ab initio or  merely invalid or inoperative on the premise that semantic luxuries are  misplaced in the interpretation of ’bread and butter’ statutes.  In that context,  Chinnappa Reddy, J. observed:

"\005Plain common sense dictates that the removal  of an order terminating the services of workmen  must ordinarily lead to the reinstatement of the  services of the workmen. It is as if the order has  never been, and so it must ordinarily lead to back  wages too. But there may be exceptional  circumstances which make it impossible or wholly  inequitable vis-‘-vis the employer and workmen to  direct reinstatement with full back wages. For  instance, the industry might have closed down or  might be in severe financial doldrums; the  workmen concerned might have secured better or  other employment elsewhere and so on. In such  situations, there is a vestige of discretion left in the  court to make appropriate consequential orders.  The court may deny the relief of reinstatement  where reinstatement is impossible because the  industry has closed down. The court may deny the  relief of award of full back wages where that  would place an impossible burden on the  employer. In such and other exceptional cases the  court may mould the relief, but, ordinarily the  relief to be awarded must be reinstatement with  full back wages. That relief must be awarded  where no special impediment in the way of  awarding the relief is clearly shown. True,  occasional hardship may be caused to an employer  but we must remember that, more often than not,  comparatively far greater hardship is certain to be  caused to the workmen if the relief is denied than  to the employer if the relief is granted."

       Yet again, no law in absolute terms had been laid down therein.  The  court proceeded on the basis that there may be situations where grant of full  back wages would be inequitable.  In the fact situation obtaining therein, the  court, however was of the opinion that there was no impediment in the way  of awarding the relief.  It is interesting to note that Pathak, J., as His  Lordship then was, however was of the view:

"Ordinarily, a workman who has been retrenched  in contravention of the law is entitled to  reinstatement with full back wages and that  principle yields only where the justice of the case  in the light of the particular facts indicates the  desirability of a different relief."

       The expression ’ordinarily’ must be understood given its due

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meaning.   A useful reference in this behalf may be made to a 4-Judge Bench  decision of this Court in Jasbhai Motibhai Desai v. Roshan Kumar, Haji  Bashir Ahmed and Others [(1976) 1 SCC 671] wherein it has been held:

"35. The expression "ordinarily" indicates that this  is not a cast-iron rule. It is flexible enough to take  in those cases where the applicant has been  prejudicially affected by an act or omission of an  authority, even though he has no proprietary or  even a fiduciary interest in the subject-matter. That  apart, in exceptional cases even a stranger or a  person who was not a party to the proceedings  before the authority, but has a substantial and  genuine interest in the subject-matter of the  proceedings will be covered by this rule. The  principles enunciated in the English cases noticed  above, are not inconsistent with it."

       In J.N. Srivastava v. Union of India and Another [(1998) 9 SCC 559]  again no law has been laid down in the fact situation obtaining therein.  The  court held that the workmen had all along been ready and willing to work,  the plea of ’no work no pay’ as prayed for should not be applied.

       We may notice that in M.D., U.P. Warehousing Corpn. v. Vijay  Narayan Vajpayee [(1980) 3 SCC 459] and Jitendra Singh Rathor v. Shri  Baidyanath Ayurved Bhawan Ltd. although an observation had been made to  the effect that in a case where a breach of the provisions of Section 25-F has  taken place, the workmen cannot be denied back wages to any extent, no  law, which may be considered to be binding precedent has been laid down  therein.   

       In P.G.I. of Medical Education & Research, Chandigarh v. Raj Kumar  [(2001) 2 SCC 54], Banerjee, J., on the other hand, was of the opinion:

"The learned counsel appearing for the  respondents, however, placed strong reliance on a  later decision of this Court in PGI of M.E. &  Research Chandigarh v. Vinod Krishan Sharma  wherein this Court directed payment of balance of  60% of the back wages to the respondent within a  specified period of time. It may well be noted that  the decision in Soma case has been noticed by this  Court in Vinod Sharma case wherein this Court  apropos the decision in Soma case observed:  "A mere look at the said judgment shows  that it was rendered in the peculiar facts and  circumstances of the case. It is, therefore,  obvious that the said decision which centred  round its own facts cannot be a precedent in the  present case which is based on its own facts."  We also record our concurrence with the  observations made therein. Payment of back wages having a discretionary  element involved in it has to be dealt with, in the  facts and circumstances of each case and no  straight-jacket formula can be evolved, though,  however, there is statutory sanction to direct  payment of back wages in its entirety. As regards  the decision of this Court in Hindustan Tin Works  (P) Ltd. be it noted that though broad guidelines,  as regards payment of back wages, have been laid

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down by this Court but having regard to the  peculiar facts of the matter, this Court directed  payment of 75% back wages only."

       The decisions of this Court strongly relied upon by Mr. Sangal,  therefore, do not speak in one voice that the industrial court or for that  matter the High Court or this Court would not have any discretionary role to  play in the matter of moulding the relief.  If a judgment is rendered merely  having regard to the fact situation obtaining therein, the same, in our  opinion, could not be a declaration of law within the meaning of Article 141  of the Constitution of India.

       It is one thing to say that the court interprets a provision of a statute  and lays down a law, but it is another thing to say that the courts although  exercise plenary jurisdiction will have no discretionary power at all in the  matter of moulding the relief or otherwise give any such reliefs, as the  parties may be found to be entitled to in equity and justice.  If that be so, the  court’s function as court of justice would be totally impaired.  Discretionary  jurisdiction in a court need not be conferred always by a statute.   

       Order VII, Rule 7 of the Code of Civil Procedure confers power upon  the court to mould relief in a given situation.  The provisions of the Code of  Civil Procedure are applicable to the proceedings under the Industrial  Disputes Act.  Section 11-A of the Industrial Disputes Act empowers the  Labour Court, Tribunal and National Tribunal to give appropriate relief in  case of discharge or dismissal of workmen.   

       The meaning of the word ’discharge’ is somewhat vague.  In this case,  we have noticed that one of the contentions of the Appellant was that the  services of the Respondent had been terminated in terms of its order dated  12/13.2.1987 whereby and whereunder the services of the Respondent herein  was approved till 31.3.1987.

       The Industrial Disputes Act was principally established for the  purpose of pre-empting industrial tensions, providing the mechanics of  dispute-resolutions and setting up the necessary infrastructure so that the  energies of partners in production may not be dissipated in counter- productive battles and assurance of industrial justice may create a climate of  goodwill. [See LIC v. D.J. Bahadur, (1981) 1 SCC 315]

       Industrial Courts while adjudicating on disputes between the  management and the workmen, therefore, must take such decisions which  would be in consonance with the purpose the law seeks to achieve.  When  justice is the buzzword in the matter of adjudication under the Industrial  Disputes Act, it would be wholly improper on the part of the superior courts  to make them apply the cold letter of the statutes to act mechanically.   Rendition of justice would bring within its purview giving a person what is  due to him and not what can be given to him in law.

       A person is not entitled to get something only because it would be  lawful to do so.  If that principle is applied, the functions of an industrial  court shall lose much of its significance.

       The changes brought about by the subsequent decisions of this Court  probably having regard to the changes in the policy decisions of the  government in the wake of prevailing market economy, globalization,  privatization and outsourcing is evident.

       In Hindustan Motors Ltd. v. Tapan Kumar Bhattacharya and Another  [(2002) 6 SCC 41], this Court noticed Raj Kumar (supra) and Hindustan Tin  Works (supra) but held:

"As already noted, there was no application of  mind to the question of back wages by the Labour

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Court. There was no pleading or evidence  whatsoever on the aspect whether the respondent  was employed elsewhere during this long  interregnum. Instead of remitting the matter to the  Labour Court or the High Court for fresh  consideration at this distance of time, we feel that  the issue relating to payment of back wages should  be settled finally. On consideration of the entire  matter in the light of the observations referred to  supra in the matter of awarding back wages, we are  of the view that in the context of the facts of this  particular case including the vicissitudes of long- drawn litigation, it will serve the ends of justice if  the respondent is paid 50% of the back wages till  the date of reinstatement..."

       The Court, therefore, emphasized that while granting relief application  of mind on the part of the industrial court is imperative.  Payment of full  back wages, therefore, cannot be the natural consequence.

       To the same extent are the decisions of this Court in Indian Railway  Construction Co. Ltd. v. Ajay Kumar [(2003) 4 SCC 579] and M.P. State  Electricity Board v. Jarina Bee (Smt.) [(2003) 6 SCC 141].

       The said decisions have recently been considered and followed in U.P.  State Textile Corpn. Ltd. v. P.C. Chaturvedi and Others [(2005) 8 SCC 211].

       Lahoti, J., as the learned Chief Justice then was, in S.M. Nilajkar and  Others v. Telecom District Manager, Karnataka [(2003) 4 SCC 27] opined:

"The fact remains that there was delay, though not  a fatal one, in initiating proceedings calculating the  time between the date of termination and initiation  of proceedings before the Industrial Tribunal-cum- Labour Court. The employee cannot be blamed for  the delay. The learned Single Judge has denied the  relief of back wages while directing the appellants  to be reinstated. That appears to be a just and  reasonable order\005"

       In Rattan Singh v. Union of India [(1997) 11 SCC 396], the Court  directed payment of a consolidated sum of Rs. 25,000/- in lieu of back  wages and reinstatement having regard to the time lag between the date of  termination and the date of order.

       In Ruby General Insurance Co. Ltd. v. Chopra (P.P.) [(1969) 3 SCC  653] and Hindustan Steels Ltd. v. A.K. Roy [(1969) 3 SCC 513], this Court  held that before granting reinstatement, the court must weight all the facts  and exercise discretion whether to grant reinstatement or to award  compensation.

       The said decisions were, however, distinguished in Mohan Lal v.  Management of M/s. Bharat Electronics Ltd. [(1981) 3 SCC 225].  Desai, J.  was of the opinion:

"17\005But there is a catena of decisions which rule  that where the termination is illegal especially  where there is an ineffective order of retrenchment,  there is neither termination nor cessation of service  and a declaration follows that the workman  concerned continues to be in service with all  consequential benefits. No case is made out for  departure from this normally accepted approach of  the courts in the field of social justice and we do

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not propose to depart in this case."

       In Allahabad Jal Sansthan v.  Daya Shankar Rai and Another [(2005)  5 SCC 124], in which one of us was a party, this Court had taken into  consideration most of the decisions relied upon by Mr. Sangal and observed:

"A law in absolute terms cannot be laid down as to  in which cases, and under what circumstances, full  back wages can be granted or denied. The Labour  Court and/or Industrial Tribunal before which  industrial dispute has been raised, would be  entitled to grant the relief having regard to the  facts and circumstances of each case. For the said  purpose, several factors are required to be taken  into consideration. It is not in dispute that  Respondent 1 herein was appointed on an ad hoc  basis; his services were terminated on the ground  of a policy decision, as far back as on 24-1-1987.  Respondent 1 had filed a written statement  wherein he had not raised any plea that he had  been sitting idle or had not obtained any other  employment in the interregnum. The learned  counsel for the appellant, in our opinion, is correct  in submitting that a pleading to that effect in the  written statement by the workman was necessary.  Not only no such pleading was raised, even in his  evidence, the workman did not say that he  continued to remain unemployed. In the instant  case, the respondent herein had been reinstated  from 27-2-2001."

       It was further stated:

"16. We have referred to certain decisions of this  Court to highlight that earlier in the event of an  order of dismissal being set aside, reinstatement  with full back wages was the usual result. But now  with the passage of time, it has come to be realised  that industry is being compelled to pay the  workman for a period during which he apparently  contributed little or nothing at all, for a period that  was spent unproductively, while the workman is  being compelled to go back to a situation which  prevailed many years ago when he was dismissed.  It is necessary for us to develop a pragmatic  approach to problems dogging industrial relations.  However, no just solution can be offered but the  golden mean may be arrived at."

       Yet again in General Manager, Haryana Roadways  v. Rudhan Singh  [JT 2005 (6) SC 137 : (2005) 5 SCC 591], a 3-Judge Bench of this Court in a  case where the workman had worked for a short period which was less than  a year and having regard to his educational qualification, etc. denied back  wages although the termination of service was held to have been made in  violation of Section 25F of the Industrial Disputes Act, 1947 stating:

"\005A host of factors like the manner and method  of selection and appointment i.e. whether after  proper advertisement of the vacancy or inviting  applications from the employment exchange,  nature of appointment, namely, whether ad hoc,  short term, daily wage, temporary or permanent in

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character, any special qualification required for the  job and the like should be weighed and balanced in  taking a decision regarding award of back wages.  One of the important factors, which has to be taken  into consideration, is the length of service, which  the workman had rendered with the employer. If  the workman has rendered a considerable period of  service and his services are wrongfully terminated,  he may be awarded full or partial back wages  keeping in view the fact that at his age and the  qualification possessed by him he may not be in a  position to get another employment. However,  where the total length of service rendered by a  workman is very small, the award of back wages  for the complete period i.e. from the date of  termination till the date of the award, which our  experience shows is often quite large, would be  wholly inappropriate. Another important factor,  which requires to be taken into consideration is the  nature of employment. A regular service of  permanent character cannot be compared to short  or intermittent daily-wage employment though it  may be for 240 days in a calendar year."

       In A.P. State Road Transport Corporation and Others v. Abdul  Kareem [(2005) 6 SCC 36] while the Labour Court directed reinstatement  with continuity of service of the Respondent but without back wages, this  Court denied even the continuity of service.

       A Division Bench of this Court In M.L. Binjolkar v. State of Madhya  Pradesh [JT 2005 (6) SC 461 : (2005) 6 SCC 224], referring to a large  number of decisions, held:

"7\005 The earlier view was that whenever there is  interference with the order of termination or  retirement, full back wages were the natural  corollary. It has been laid down in the cases noted  above that it would depend upon several factors  and the Court has to weigh the pros and cons of  each case and to take a pragmatic view\005"

       In Management of Madurantakam Coop. Sugar Mills Ltd. v. S.  Viswanathan [(2005) 3 SCC 193], quantum of back wages was confined to  50% stating:

"19\005 It is an undisputed fact that the workman  had since attained the age of superannuation and  the question of reinstatement does not arise.  Because of the award, the respondent workman  will be entitled to his retiral benefits like gratuity,  etc. and accepting the statement of the learned  Senior Counsel for the appellant Mills that it is  undergoing a financial crisis, on the facts of this  case we think it appropriate that the full back  wages granted by the Labour Court be reduced to  50% of the back wages\005"

       In  State of U.P. and Others v. Ram Bachan Tripathi [(2005) 6 SCC  496], this Court denied the service benefits for the period the employee  remained absent.

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       In Rajasthan State Road Transport Corpn. and Others v. Shyam Bihari  Lal Gupta [(2005) 7 SCC 406], it was observed:

"3. According to the learned counsel for the  appellant Corporation, the decree is absolutely  silent so far as the back wages are concerned. The  decree in essence contains only a declaratory relief  without any consequential payment for monetary  benefits. That being so, the executing court and the  High Court were not justified in granting the relief  sought for. Learned counsel for the respondent on  the other hand submitted that when the decree  clearly indicated that the termination was illegal  non est, as a natural corollary, the plaintiff was  entitled to the back wages."

       In the instant case, we have noticed hereinbefore that the  establishment of the Appellant wherein the Respondent could be directed to  be reinstated had been sold on 26.3.1993.  In that view of the matter, Section  6O of the U.P. Industrial Disputes Act would apply in terms whereof  compensation will be payable in the same manner as if he was retrenched  under Section 6N thereof.  

       It is not in dispute that the Respondent did not raise any plea in his  written statement that he was not gainfully employed during the said period.   It is now well-settled by various decisions of this Court that although earlier  this Court insisted that it was for the employer to raise the aforementioned  plea but having regard to the provisions of Section 106 of the Indian  Evidence Act or the provisions analogous thereto, such a plea should be  raised by the workman.   

In Kendriya Vidyalaya Sangathan (supra), this Court held:

"\005When the question of determining the  entitlement of a person to back wages is  concerned, the employee has to show that he was  not gainfully employed. The initial burden is on  him. After and if he places materials in that regard,  the employer can bring on record materials to rebut  the claim. In the instant case, the respondent had  neither pleaded nor placed any material in that  regard."

       [See also Allahabad Jal Sansthan (supra), para 6]  

       The only question is whether the Respondent would be entitled to  back wages from the date of his termination of service till the  aforementioned date.  The decision to close down the establishment by the  State of Uttar Pradesh like other public sector organizations had been taken  as far back on 17.11.1990 wherefor a GO had been issued.  It had further  been averred, which has been noticed hereinbefore, that the said GO has  substantially been implemented.  In this view of the matter, we are of the  opinion that interest of justice would be subserved if the back wages payable  to the Respondent for the period 1.4.1987 to 26.3.1993 is confined to 25% of  the total back wages payable during the said period.   

       The judgments and orders of the Labour Court and the High Court are  set aside and it is directed that the Respondent herein shall be entitled to  25% back wages of the total back wages payable during the aforesaid period   and compensation payable in terms of Section 6-N of the U.P. Industrial  Disputes Act.  If, however, any sum has been paid by the Appellant herein,  the same shall be adjusted from the amount payable in terms of this  judgment.

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       For the reasons aforementioned, the appeal is allowed in part and to  the extent mentioned hereinbefore.  However, there shall be no order as to  costs.