M/S TRENDS v. Leelamma Thomas and Anr.

1. This application has been filed by respondent/worker under section 17B of the Industrial Disputes Act, 1947 (“the Act”) for payment of wages during the pendency of the present proceedings. The brief facts are that she was employed with the petitioner/organization on 13th November, 2007 as a receptionist and was terminated on 7th March, 2014. Reference was made on 21st July, 2015 by the competent authority to the Ld. Labour Court. The Ld. W.P.(C) 10537/2019 2/10 Labour Court reverted with a decision on 27th April, 2019 directing reinstatement of the respondent/worker with full back-wages along with continuity of services and all other consequential benefits. This writ petition challenging the same was filed by the petitioner/management on 25th September, 2019 on which date this Court directed a stay on operation of the impugned award subject to the petitioner depositing a sum of Rs. 3 lakhs. The Court had also noted that the petitioner was ready to explore the possibility of an amicable settlement; however, mediation report dated 29th April, 2023 was filed by the Delhi High Court Mediation and Conciliation Centre stating that despite deliberations, mediation was unsuccessful.

2. As per the application, respondent/worker was unemployed since the time of her termination on 7th March, 2014. Further, she states that she has to look after her family and had been borrowing money from relatives and friends since her removal from the service; as she is also living on rent and has no source of income from any means.

3. In response, a reply was filed by the petitioner/management. Learned counsel for the petitioner adverting to this reply, submitted as under: a. There was a gross delay in filing the section 17B application, in that while the petition was filed in 2019, the application was filed in September, 2022. Such a gross delay would substantiate the contention of the petitioner/management that there was no financial hardship and the assertion by the respondent/worker is false, bogus and suspicious. W.P.(C) 10537/2019 3/10 b. The respondent/worker had actually resigned from the petitioner/organization and thereafter has been gainfully employed elsewhere. It was also stated that the petitioner/organization is a small entity with 5 employees, which in fact closed down on 30th May, 2014. To substantiate the assertion of resignation, the petitioner’s counsel relied upon a letter dated 7th March, 2014, Annexure P-8 to the petition, which is a resignation letter of the respondent/worker as also a full and final settlement of all her dues. c. To support the contention that the petitioner entity had been closed, reliance was placed on letter dated 30th May, 2014 addressed by the proprietor of the petitioner to the Senior Manager, Canara Bank, Lajpat Nagar Branch, New Delhi stating that she has closed the business and would like to close the bank account NO. 0341201014906 in the name of the petitioner entity. He therefore, contended that since the entity was closed even before the award could be passed, respondent/worker would not be entitled to relief under section 17B. At best, even if she was disengaged from service in March, 2014 and the business had been closed in May, 2014, she could only have been employed for 2 more months since then. The petitioner’s counsel relies upon the decision of Gujarat High Court in Iron Rolling Mills Pvt. Ltd. v. Vinodkumar R. Singh, 2008 SCC OnLine GUJ 65, in relation to a section 17B application where the issue discussed in para 7.[2] was the closure of a unit which was declared as a sick industrial company wherein there is reference to W.P.(C) 10537/2019 4/10 an earlier decision in LPA 933/1999, namely, Akbarkhan M. Pathan v. General Manager. What was noted in the said order was that the closure was a subsequent event after the passing of the award. Therefore, the right of the worker had accrued when the award was passed and a subsequent development in form of closure of a business is not contemplated under section 17B of the Act. The petitioner’s counsel however contends that on the basis that there is evidence in terms of a letter addressed to a bank that the business was closed (in May, 2014) prior to award being passed (in May, 2019), the question of relief being granted under section 17B does not arise. d. Learned counsel for the petitioner further drew attention to a purported experience certificate dated 21st July, 2011 filed by the respondent/worker with her evidence. The said certificate was allegedly signed by the proprietor of the petitioner/company, though for a sister entity called ‘SOUL’. The said signatures, on the face of it were totally different from the actual signatures of Ms. Rooby Dhawer, the proprietor of the petitioner. These were requested to be verified and communications were sent to Kotak Mahindra Bank and Yes Bank where accounts of petitioner were maintained. Both the banks reverted back with communication dated 21st September, 2019 and 20th September, 2019 respectively, that there was a mismatch between the actual signatures of Ms. Dhawer with the bank and the one that was appended to the experience certificate. W.P.(C) 10537/2019 5/10 The petitioner’s counsel placed very strong reliance on this issue stating that this would amount to fraud and therefore, would not entitle the respondent/worker to any relief. On this he has relied upon the decision in Devendra Kumar v. State of Uttaranchal and Others, (2013) 9 SCC 363, where it is stated as under:

” e. Petitioner’s counsel further contended that the plea of financial hardship by the respondent/worker was not honest and correct considering that she belonged to an affluent family and was owner of a residential dwelling unit (DDA flat at Mathura Road, New Delhi) which was converted from lease hold to free hold in the month of January, 2017. A copy of the agreement to sell of February, 1994 along with a copy of conveyance deed executed by the DDA for conversion from lease hold to free hold of the said property, was annexed with the reply to this application under section 17 B by the petitioner. It was further stated in their reply that W.P.(C) 10537/2019 6/10 the spouse of the respondent/worker was settled in a Middle Eastern Country and their children were in Canada for studies and were settled there. Therefore, the claims that she was staying on rent and facing financial hardships were completely belied by these documents of ownership of the flat.

4. In response to the above submissions, the learned counsel for the respondent/worker stated that the petitioner/management had not taken the stand before the Ld. Labour Court that the entity had closed and is now taking this plea afresh before this Court. Moreover, except for the letter of closure of bank accounts, nothing else has been filed. On this basis their plea that the entity was closed cannot be accepted. Secondly, on the account of delay it was submitted that there was no limitation prescribed in Section 17 of the Act which would disentitle the worker from approaching the Court for relief. Thirdly, respondent/worker had already stated on affidavit that she was not employed elsewhere and that was the only condition that was required to be satisfied for seeking relief under section 17B.

5. The respondent/worker’s counsel did not deny issue of sale deed and the ownership of the property as contended by the petitioner. Further, he did not place on record a rejoinder, to controvert the submissions made by the petitioner in their reply to the application, as directed by this Court vide Order dated 10th October 2023. W.P.(C) 10537/2019 7/10

6. This Court has given serious consideration to the submission by the parties and the documents placed before it. For the ease of reference, it would be useful to extract section 17B of the Industrial Disputes Act, 1947: “17B. Payment of full wages to workman pending proceedings in higher courts.—Where in any case, a Labour Court, Tribunal or National Tribunal by its award directs reinstatement of any workman and the employer prefers any proceedings against such award in a High Court or the Supreme Court, the employer shall be liable to pay such workman, during the period of pendency of such proceedings in the High Court or the Supreme Court, full wages last drawn by him, inclusive of any maintenance allowance admissible to him under any rule if the workman had not been employed in any establishment during such period and an affidavit by such workman had been filed to that effect in such Court: Provided that where it is proved to the satisfaction of the High Court or the Supreme Court that such workman had been employed and had been receiving adequate remuneration during any such period or part thereof, the Court shall order that no wages shall be payable under this section for such period or part, as the case may be.”

7. It is evident from bare reading of the said section that this provision is to provide relief to a worker resulting in delay of implementation of an award in their favour due to a pending challenge before a Court. In this regard it would be useful to refer to observations of the Ld. Division Bench of this Court in MCD v. Santosh Kumari, 2012 SCC OnLine Del 4390, where it is stated as under: