SANTOSH GUPTA versus STATE BANK OF PATIALA

Citation: [1980] 3 S.C.R. 884 · Decided: 29-04-1980 · Supreme Court of India · Bench: V.R. KRISHNA IYER · Disposal: Appeal(s) allowed

Cited by 2 judgment(s) · cites 3 · see the full citation network in Lexace

Judgment (excerpt)

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884 
SANTOSH GUPTA 
v. 
STATE BANK OF PATIALA 
April 29, 1980 
[V. R. KRISHNA !YER AND 0. CH!NNAPPA REnoY JJ.] 
Industrial Disputes Act, 1941-Section 2 (00)-"Retrenchment"-Termina-
fion. ·.· •. ·.for t11lY rea'>'iO!. whatsoever, meaning uf Section 25 FF and Section 
25 FFF object of. 
" 
The appellant was employed in the State Bank of Patiala, The Mall, Paliala, 
from July 13, 1973 till August 21, 1974, when her services were terminated. 
Despite some breaks in service for a few days, the appellant had admittedly 
worked for 240 days in the year preceding August 21, 1974. According to the 
workman, the termination of her service was "retrenchment" within the meaning 
of that expression in Section 2(oo) of the Industrial Disputes Act, 1947, 1inco 
it did not fall within any of the excepted cases mentioned in Section 2(00), 
Since there was "retrenchment", it was bad for non-compliance with the provi· 
sions of section 25 l' of the Industrial Disputes Act. 
On the· other ·hand, the 
contention of the management was that the termination of services was not due 
to discharge of surplus labour. It was due to the failure of the workman to 
pass the test which would have enabled him to be confirmed in the service. 
Therefore, it was not retrenchment within the meaning of section 2 ( 00) of the, 
Industrial Disputes Act. The Presiding Officer, Central Government, Industrial 
Tribunal-cum·Labour Court, accepted the management's contention and decided 
against the workman appellant. Hence the appeal by special leave. 
Allowing the appeal, the Court 
HELD : (i) The discharge of the workman on the ground that she did not 
pass the test which would have enabled him to be confirmed was "retrenchment" 
within the meaning of section 2(00) and, therefore, the requirements of section 
25F had to be complied with. [892 F-GJ 
.. ~ 
(ii) Section 2(00) of the Jndustirial Disputes Act uses a wide language_...~ 
particularly the words "term.iriation .............. for any reason whatsoever". 
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The definition "retrenchment" expressly excludes termination of service as a 
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.. punishment inflicted by way of disciplinary action". It does not include, 
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voluntary retrenchment of the workman or retrenchmCnt of the workman on 
reaching the age of superannuation or termination of the service of the workman 
on the ground of continuous ill·health. The Legislature took special care to 
mention that these were not included within the meaning of "termination by the 
employer of the service of a workman for any reason whatsoever". 
Th..i8 
emphasises the broad interpretation to be given to the expression "retrenchment". 
[887 E-H, 888 A] 
2. If due weight is given to the words "the termination by the employer 
of the service of a workman for any: reason whatsoever" and if the words 'for 
any reason whatsoever" are understood to mean what they plainly say, iti is 
difficult to escape the conclusion that the expression 'retrenchment' must include 
every termination of the service of a workman by an act of the employer. Tle 
underlying assumption, of course, is that the undertaking is ru!!D.ing as an under-
SANTOSH GUPTA V, STATE BANK 
885 
taking and the employer continues Wi an employer but where either on account 
of transfer of the undertaking or on account of the closure of the undertaking 
tlie basic assumption disappears, there can be no question of 
'~etrenChment' 
within the meaning of the definition contained in s. 2(00) of the Act. 
[888 A-CJ 
Hariprasad Shivshankar Shukla v. A. D. Divakar [1957] SCR 121; applied. 
A. 
By introducing section 25 FF and Section 25 FFF, Parliament treated the 
B: 
termination of the service of a work.man on the transfer or closure of an under-
taking as "deemed retrenchment". The effect was that every case of termination 
of service by act of employer even if such termination was a consequence of 
transfer or closure of the undertaking was to be treated as 'retrenchment' for 
tho purposes of notice, compensation etc." The expression ''termination of 
service for any reason whatsoever" now covers every kind of termination of 
service. except those not expressly included in S. 25F or not expressly provided 
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for by ot'her provisions of theAct as 25 FF and 25 FFF. [888 C-F] 
4. The manifest object of Section 25 FF and S. 25 FFF is to so compensate 
the workman for loss of employment as to provide him the wherewithal to 
subsist until he finds fresh employment. The non-inclusion of 'volunt

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