J.K. COTION SPG. AND WVG MILLS CO. LTD., KALPI ROAD, KANPUR versus STATE OF U.P. AND ORS.

Citation: [1990] 3 S.C.R. 523 · Decided: 27-07-1990 · Supreme Court of India · Bench: S. RANGANATHAN · Disposal: Appeal(s) allowed

Cited by 2 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

,Z, 
J.K. COTION SPG. AND WVG MILLS CO. LTD., 
KALPI ROAD, KANPUR 
v. 
STATE OF U.P. AND ORS. 
JULY 2TIH, 1990 
[S. RANGANATHAN AND A.M. AHMADI, JJ.] 
U.P. Industrial Disputes Act, 1947-Section 2(s) and 6N-
Resignation voluntarily tendered by an employee--Employer accepting 
the same:_Services of employee terminated-Whether amounts to 
'retrenchment'. 
One Ram Singh was appointed by the appellant-company on 
10.3.1960. On 1.11.1970, he addressed a letter of resignation to the 
Manager of the company saying that owing to his family circumstances, 
it was no longer possible for him to continue in service and that he was 
compelled to sever his connections with the company. He made a 
demand of all his dues. He wrote another letter two days later that 
someone should be posted in the section where he was working in order 
that he may learn the work re: printing of shares, pay-sheets and pay. 
registers etc. The appellant-company conveyed the acceptance of the 
resignation with effect from the 16th November, 1970 and paid all his dues 
on 22.12.1970. The amount of gratuity was also paid later. Ram Singh 
thereafter raised an industrial dispute and sought a reference under 
Section 4K of the U.P. Industrial Dispute Act, 1947. Initially his 
demand was not accepted by the State Government but later the State 
Government accepted his demand on 28. ll.1974 whereupon the 
appellant-company filed a writ petition in the High Court challenging 
the said reference made by the State Government but the High Court 
dismissed the petition. The Labour Court thereafter made an award on 
the reference, in favour of the employee. It came to the conclusion that 
the employee's resignation was not voluntary and therefore his services 
had been wrongly terminated and accordingly he was directed to be 
reinstated. The appellant challenged the validity of the said award 
under Article 226 of the Constitution before the High Court. The High 
Court c11me to the conclusion that the employee had tendered his resig-
nation voluntarily but it held that termination of the service of the 
employee fell within the definition of 'retrenchment' as contained in 
Section 2(s) and as the appellant-company had failed to comply with the· 
requirement of Section 6N, the termination of service was invalid. The 
High Court accordingly set aside the order of reinstatement passed by 
523 
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524 
SUPREME COURT REPORTS 
[1990] 3 S.C.R. 
the Labour Court and remanded the matter to the Labour Court for a 
decision on the question whether there was infraction of the provisions 
of Section 6N. Being aggrieved by that order of the High Court, the 
_ appellant,company has filed this appeal after obtaining specfal leave. 
Allowing tbe appeal, this Court, 
HELD: Where a contract of service is determined on the employee 
. exercising his right to quit, such termination cannot be said to be at the 
instance of the employer to fall within the first P"rt of the definition of 
retrenchment in Section 2(s) of the U.P. Industrial D'.sputes Act. [531H; 532A] 
. A contract of service can bC determined by either party to the 
contract. If it is determined at the behest of the employer it may amount 
to retrenchment unless it is 1'y way of punishment for proved miscon-
duct. But if an employee takes the initiative and exercises his right to 
put an end to the contract or service and the employer merely assents to 
it, it cannot be said that the employer has terminated the employment. 
D In such' cases the employer is merely acceding to the employee's 
request; may be even reluctantly. Here the employee's role is active 
while the employer's role is passive and formal. The employer cannot 
force an unwilling employee to work for him. (53 IE-F] 
When an employee resigns hiS office, he formally relinquishes or 
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E 
withdraws from his office; It implies that he has taken a mental decision 
to sever his relationship with his employer and thereby put an end to the 
contract of service. [533E]. 
In the present case the employee's request contained in the letter 
·, 
of resignation was accepted by the employer and that brought an end to 
'·p -~the contract or service. [534B] 
G 
." 
-,.This 'was ,;·case or 'voluntary retirement' within the meaning or 
the first exception to section 2(s) and therefore the question or grant or 
compensation under section 6N did not arise. The employee is not 
entitled to any compensation ':'oder se

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