Case Note & Summary
The petitioner, H.C. Jayaprakash, was a clerk employed by Vijaya Bank. He was removed from service on 27.09.2001. A dispute was referred to the Central Government Industrial Tribunal-cum-Labour Court, Bangalore, which by an award dated 21.03.2007 held that the charge against the workman was not established and the removal was illegal and void ab initio. The Tribunal directed reinstatement with full back wages from the date of dismissal (minus interim relief) till reinstatement, with continuity of service and all other consequential benefits. The petitioner was reinstated on 01.06.2007. He subsequently retired on 31.05.2014. After retirement, he claimed leave encashment of Rs. 2,74,328/- for the period of forced absence (27.09.2001 to 31.05.2007). The respondent bank denied the claim. The petitioner filed an application under Section 33C(2) of the Industrial Disputes Act, 1947 before the Tribunal, which was dismissed by order dated 03.12.2014. The Tribunal held that leave encashment is not a benefit that can be claimed for the period of forced absence. The petitioner challenged this order by way of a writ petition under Articles 226 and 227 of the Constitution of India. The High Court considered the issue of whether a workman reinstated with full back wages and continuity of service is entitled to leave encashment for the period of forced absence. The court noted that the earlier award had granted reinstatement with full back wages and continuity of service, which meant that the workman was deemed to be in continuous service. The denial of leave encashment for that period was perverse and unjustified. The court held that the Tribunal's order was liable to be set aside. The writ petition was allowed, the impugned order dated 03.12.2014 was quashed, and the respondent was directed to pay the leave encashment benefit of Rs. 2,74,328/- to the petitioner within eight weeks.
Headnote
A) Service Law - Leave Encashment - Reinstatement with Back Wages - Entitlement to Leave Encashment - Industrial Disputes Act, 1947, Section 11A - The petitioner, a bank clerk, was removed from service and later reinstated with full back wages and continuity of service. The Tribunal denied leave encashment for the period of forced absence. The High Court held that since the removal was void ab initio and the workman is deemed to be in continuous service, he is entitled to leave encashment for the period of forced absence. The denial was perverse and set aside. (Paras 1-6) B) Industrial Law - Industrial Disputes Act, 1947 - Section 11A - Reinstatement with Back Wages - Continuity of Service - The Tribunal's award of reinstatement with full back wages and continuity of service implies that the workman is deemed to have been in service throughout. Consequently, all benefits including leave encashment must be granted. (Paras 3-6)
Issue of Consideration
Whether the petitioner, who was reinstated with full back wages and continuity of service, is entitled to leave encashment benefit for the period of his forced absence from service.
Final Decision
The writ petition is allowed. The impugned order dated 03.12.2014 passed by the Central Government Industrial Tribunal-cum-Labour Court, Bangalore in CGA No.03/2012 is set aside. The respondent is directed to pay the leave encashment benefit of Rs. 2,74,328/- to the petitioner within eight weeks from the date of receipt of a copy of this order.
Law Points
- Leave encashment is a statutory right under the Payment of Gratuity Act
- 1972 and the Industrial Disputes Act
- 1947
- denial of leave encashment to a reinstated workman is illegal
- the Tribunal's order denying leave encashment was perverse and set aside.
