Punjab Land Development And Reclamation Corporation Ltd. vs Presiding Officer, Labour Court, dealt with the word Retrenchment under the Industrial Dispute Act, 1947. It is one of the landmark cases in labor laws.

BENCH: Justice K.N. Saikia, Chief Justice Sabyasachi Mukharji, Justice B.C. Ray, Justice M.H. Kania, Justice S.C. Agrawal.

PUNJAB LAND DEVELOPMENT AND RECLAMATION CORPORATION LTD. JUDGEMENT DATE: May 4^th, 1990

PUNJAB LAND DEVELOPMENT AND RECLAMATION CORPORATION LTD. CASE CITATION: (1990) 3 SCC 682

PUNJAB LAND DEVELOPMENT AND RECLAMATION CORPORATION LTD. CASE FACTS:

Multiple Civil Appeals were filed regarding the issue of retrenchment. One of them is as follows:

• CIVIL APPEAL NO. 324z-3248 OF 1981: The workmen (respondents) were appointed under the management of the corporation (petitioner).
• The respondents were dismissed from their services on the ground that the chairperson is not entitled to appoint the workmen.
• They filed the case in the Labour Court where the court held that the services of the workers are illegally terminated with no retrenchment and they are liable for reinstatement with back wages except for Yashpal.
• They will be paid the wages up to 10th October 1979 with the continuity of services under the Industrial Dispute Act, 1947. Then the appeal was filed in the High Court. The court set aside the order of the labor court’s order of reinstatement with full back wages and continuity of service.

ISSUES:

• What is the word “retrenchment” under Section 2(oo) of the Industrial Dispute Act, 1947 mean?

CONTENTIONS:

EMPLOYER’S CONTENTIONS (PETITIONER): The petitioner contended that the word retrenchment means termination of services of workmen as surplus labor by the employer for any reason under Section 2 (oo) of the Industrial Dispute Act.

WORKMEN’S CONTENTIONS (RESPONDENT): The workmen contended that retrenchment means termination of services of workers for any reason except those reasons which are excluded under Section 2 (oo) of the Industrial Dispute Act.

RATIO DECEDENDI:

• Justice K.N. Saikia, Chief Justice Sabyasachi Mukharji, Justice B.C. Ray, Justice M.H. Kania, Justice S.C. Agrawal: The bench analyzed the definition of retrenchment under Section 2(oo) of the Industrial Dispute Act by stating the requirements i) termination of service of a workman ii) by the employer iii) for any whatsoever iii) otherwise than as a punishment inflicted by way of disciplinary action. The court stated that the intention of the statute must be considered instead of presumed intention.
• The Bench further stated that there is an inconsistency in the definition of Section 2(oo) with the main provisions of Section 25F, 25G, and 25H but there can be harmonious construction.
• The Bench referred to the case of Sundara Money, the Supreme Court considered wider liberal meaning, rejecting narrower meaning. It also stated by concluding from the subsequent cases that it is not mandatory to stick to the precedents if that changes the basis of legislation.
• It further stated that the word “means” in the definition not only states that it includes certain things or acts; it is a definition to which no other meaning can be assigned.
• The Bench also states that if the retrenchment is understood in a wider sense, then the right of employers under the standing order and contract of employment in case of termination must have been affected by Section 2(oo), 25F, etc, and also their rights are not affected but only an additional obligation was enforced on the employer so that the affected workmen are entitled to retrenchment benefit. It also stated that the court must write the intention of the parliament if not by the legislature. It further stated that the court must interpret the statute and apply it according to the facts.

DECISION:

• The court dismissed civil appeal no.  3241-48 of 1981, 686(NL) of 1982, 18 17 of 1982, 1898 of 1982, 3261 of 1982, 1866 of 1982, 1868 of 1982, 8456 of 1983, 10828 of 1983and S.L.P. (C) No. 3149 of 1983were dismissed with the quantification of the cost at Rs. 3000 in each of the appeals.
• In the civil appeal no. 686 0f 1982, the court directed the reinstatement of the respondent as he was serving since 1983.
• In the civil appeal no. 885 of 1980, the court disposed of the appeal and directed to pay the workmen the compensation amounting to Rs. 1,25000 with reinstatement.
• Civil appeal no. 4116 of 1984, 512-513 0f 1984, 783 of 1984 were wrongly placed according to the court and the subject matter is not related to all the appeals with a similar issue involved in this case.

CONCLUSION:

• The conclusion that we can draw from this case is that the word retrenchment under Section 2(oo) of the Industrial Dispute Act must be considered and read in a wider sense.
• It also states that interpreting the statute must accord with its intention and must apply to the facts of the case accordingly.
• Therefore, interpreting the definition of retrenchment must accord to its wider sense and not according to the presumed intention.

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