HINDUSTAN STEEL LTD. versus THE PRESIDING OFFICER, LABOUR COURT, ORISSA AND ORS.

Citation: [1977] 1 S.C.R. 586 · Decided: 15-09-1976 · Supreme Court of India · Bench: Y.V. CHANDRACHUD · Disposal: Dismissed

Cited by 5 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

A 
586 
HINDUSTAN STEEL LTD. 
v. 
THE PRESIDING OFFICER, LABOUR COURT, ORISSA AND 
ORS. 
September 15, 1976 
8 
[Y. V. CHANDRACHUD, P. K. GOSWAMI AND A. C. GUPTA, JJ.] 
c 
D 
E 
F 
Industrial Dispute~ A.ct 1947-Sec. 2(00)-Mea11i111 of rtfrtnchmtllt--Ctm 
l•rmination of urvice by efflux of time covered by th~ ex,reMion r•trenchment. 
The respondenta were employed as Head Time Keepers for a period of 3 
yea.re. Pursuant to an alleged policy to streamline the organisation and to affect 
economies wherever possible, the appellant chose not to renevr the contracts of 
service of the Head Time Keepers. There was no order terminating their ser-
vices. According to the appellant the termination was auto:natic on the expiry 
of the contractual period of service. The respondents raised an industrial dis-
pute which was referred by the Government of Orissa to the Labour Court. 
The Labour Court vacated the orders of tern1ination and held that they were 
entitled to reinstatement with continuity of service and full back wages. 
The 
Labour Court came to the conclusion : 
(1) that the respondents were retrenched without complying with the 
provisions of section 25F of the Industrial Disputes Act and, there-
fore, retrenchment was contrary to law. 
(2) The termination was as a result of unfair labour practice adopted by 
the appellant employer and was not bonafide. 
( 3) It Wllll not proved that the respondents bad alternative employment 
after they were released from service. 
The appellant challenged the award by filing a Writ Petition in the Oriss;i 
High Court and contended : 
( 1) That the services of thL respondents came to an end by efflux of 
time and that it was not .a case of retrenchment. 
(2) 
(3) 
That it was for the workmen to prove that they had tried to mini-
mise their losses by obtaining employment elsewhere. 
The Labour Court erred in awarding full 
back wages 
to 
the 
respondenl8 
without satisfyini himself that they bad been un-
employed. 
The Hiih Court over-ruled the above contentions and dismissed the Writ 
Petition. 
Jn an appeal by Special Leave the appellant contendCd: (1) that the services 
of the respondents came to an end by efflux of time and that such termination 
of service did not fall within the definition of retrenchment in ecction 2(oo) of 
G 
the Industrial Disputes Act. 
H 
(2) That the present appeal is covered against the appellant by the decision 
of this Court in the case of State Bank o~ India .V: N. Sundara Mo11ey b~t that 
the said decision was contrary to an earlier dec1s1011 of a lar:er Bench m the 
case of Hari Prasad Shiv Shankar Shukla. 
DismissinJ the appeal, 
HELD : 1. Section 2( oo) which defines retrenchment m,akct it clear that the· 
retrenchment means the termination by the employer of service of a :workm:in for 
a11y reasons whataoever. Under s. 25F(a) no workman who ha.s been m contmuous 
• 
..... 
HINDUSTAN STEEL v. P.O. LABOUR COURT (Gupta, J.) 
587 
service for not less than one year under an employer C<Ln be retrenched unless 
he has been given one month's notice or wages in lieu thereof. A proviso to 
s. 25F(a) says that no such notice shall be necessary if the retrenchment is under 
an agreement which specifies a date for the termination of service. The proviso 
would be quite unnecessary if the retrenchment as defined by section 2(oo) was 
intended not to include termination . of service by efllux of time in terms of an 
!greement between the parties. 
[589B-H, 590A] 
A 
2. Hari Prasad Shuk/a's case does not run counter to the decision in the 
B 
case of State Bank of India. 
In that case what this Court held was that the 
termination of service on account of the cessation of the industry itself and 
in a bonafide closure or discontinuance of his business by the employer does not 
amount to retrenchment. 
f590B-El 
State Bank of India v. N. Sundara' Money; 1976(3) SCR and Pipraich Sui;w· 
Mills ltd. v. Pipraich Sug11r Mills Mazdoor Union [1956] S.C.R. 872; followed. 
Hariprasad ,\Nvshankar Shukla v. A. D. Dirikar, [195-i] S.C.R. 121; 
ex-
C 
" 
plained. 
•• 
3. In the Writ Petition filed by the appellant in the High Court the finding 
that the respondents had no alternative employment was not challenged. 
The 
question of mitigation of loss was not raised before the Labour Court. 
The 
High Court, therefore, rightly refrained from exercising its ·discretionary juris-
diction in favour of the employer. [590 G-H, 591A-B] 
CIVIL APPELLATE JURISDICTION : Civil Appeal N

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