Delhi High Court
State Bank Of India vs Umed Singh on 7 July, 2026
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* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 23rd April, 2026
Date of Decision: 07th July, 2026
Uploaded on: 07thJuly, 2026
+ W.P.(C) 8492/2005
STATE BANK OF INDIA .....Petitioner
Through: Mr. Rajiv Kapur, SC with Ms. Riya
Sood and Mr. Akshit Kapur, Advs.
versus
UMED SINGH .....Respondent
Through: Mr. Romy Chacko, Sr. Adv. with Mr.
Vikrant Yadav, Advs.
CORAM:
HON'BLE MS. JUSTICE SHAIL JAIN
JUDGMENT
SHAIL JAIN, J.
1. The present Writ Petition under Articles 226 and 227 of the
Constitution of India has been filed by the State Bank of India (hereinafter
referred to as the “Petitioner Bank” or “SBI”) assailing the Award dated
13.12.2004 passed by the Learned Presiding Officer, Central Government
Industrial Tribunal-cum-Labour Court-II, New Delhi (hereinafter referred to
as “the Tribunal”) in Industrial Dispute No. 107/1997.
BRIEF FACTS
2. The brief factual matrix, as borne out from the record, is that the
Petitioner Bank is a statutory corporation constituted under the provisions of
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the State Bank of India Act, 1955 and carries on the business of banking
through its various branches across the country. The present dispute arises
from the functioning of the Ajmal Khan Road Branch, Karol Bagh, New
Delhi.
3. It is the case of the Petitioner Bank that the concerned branch, being
situated on the first and second floors of a building, did not have an adequate
arrangement for water supply and, accordingly, during the period from
06.07.1994 to 31.05.1995, the Respondent, who was residing in the vicinity
of the branch, used to supply water to the branch premises. According to the
Petitioner, the Respondent used to submit monthly bills for such supply and
payments were made through Banker’s Cheques on a per-bucket basis. It is
further stated that on certain occasions, the Respondent was reimbursed actual
conveyance expenses incurred by him for delivering urgent papers, letters and
documents whenever such necessity arose.
4. The Respondent, however, disputes the aforesaid position and claims
that he had in fact been engaged as a Messenger at the Ajmal Khan Road
Branch with effect from 06.07.1994 and had continuously discharged duties
assigned to him till 31.05.1995. According to the Respondent, although
payments were reflected in the form of water-supply bills, he was, in
substance, performing duties ordinarily associated with a Messenger,
including delivery and collection of cheques, service of urgent
correspondence and other outdoor assignments. It is further his case that his
services came to be terminated with effect from 01.06.1995 without issuance
of notice, payment in lieu thereof or payment of retrenchment compensation,
as contemplated under the Industrial Disputes Act, 1947 (hereinafter referred
to as the “ID Act“).
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5. Aggrieved by the alleged termination of his services, the Respondent
raised an industrial dispute before the Assistant Labour Commissioner
(Central), Delhi. Since the conciliation proceedings failed to culminate in a
settlement between the parties, a failure report came to be submitted to the
Ministry of Labour, Government of India. Pursuant thereto, the Central
Government, vide Letter No. L-12012/55/96 IR-(B-I) dated 10.07.1997,
referred the following dispute for adjudication before the Central Government
Industrial Tribunal-cum-Labour Court-II, New Delhi:
“Whether the action of the management of SBI in terminating
the services of Sh. Umed Singh w.e.f. 1.6.95 is just and fair?
If not to what relief the concerned workman is entitled”.
6. The said reference was thereafter registered as Industrial Dispute
No.107/1997 before the Tribunal. Upon completion of proceedings, the
Tribunal passed the impugned Award dated 13.12.2004, which forms the
subject matter of challenge in the present writ petition.
SUBMISSIONS ON BEHALF OF PETITIONER
7. Learned counsel appearing on behalf of the Petitioner Bank has
advanced the following submissions in support of the present Writ Petition:
i. It is submitted that no relationship of employer and employee ever existed
between the Petitioner Bank and the Respondent. According to the
Petitioner, the Respondent was never engaged as an employee of the Bank
and the payments made to him were confined to supply of water on a per-
bucket basis and reimbursement of actual conveyance expenses incurred
for delivery of urgent documents on certain occasions. It is urged that no
wages or salary were ever paid and the Tribunal therefore erred in treatingSignature Not Verified
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the Respondent as a workman under the ID Act.
ii. It is further submitted that the Respondent was never appointed in
accordance with the prescribed recruitment procedure and that the Branch
Manager lacked authority to make any appointment to the staff of the Bank.
It is contended that the Respondent was neither appointed against a
sanctioned post nor through the competent appointing authority and,
consequently, no valid contract of service ever came into existence.
iii. Learned counsel submits that the documents relied upon by the
Respondent merely reflect occasional transactions relating to supply of
water and reimbursement of actual conveyance expenses and do not
establish continuity of service. It is further contended that in the absence of
a valid employer-employee relationship, the provisions of Section 25-F of
the ID Act are inapplicable.
iv. It is further argued that the Respondent has failed to establish completion
of 240 days of continuous service as required under Section 25-B of the ID
Act. Reliance is placed upon Surendranagar District Panchayat v.
Jethabhai Pitamberbhai,(2005) 8 SCC 450 and State of M.P. v. Arjunlal
Rajak, 2006 2 SCC 711 to contend that the burden of proving such service
lies upon the workman.
v. It is contended that even assuming completion of 240 days, the same by
itself does not confer any right to regularization or permanence in service.
Reliance is placed upon R.N. Nanjundappa v. T. Thimmiah & Anr. is
reported as (1972) 1 SCC 409 ; Mahendra L. Jain & Ors. v. Indore
Development Authority & Ors. is reported as (2005) 1 SCC 639 ; State of
Karnataka & Ors. v. Umadevi & Ors. is reported as (2006) 4 SCC 1 and
National Fertilizers Ltd. & Ors. v. Somvir Singh is reported as (2006) 5Signature Not Verified
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SCC 493 to contend that an illegal appointment cannot be regularized and
that regularization cannot be adopted as a mode of recruitment.
vi. Lastly, it is submitted that the Tribunal travelled beyond the scope of
the reference and the relief sought, by granting regularization despite the
absence of any sanctioned post. It is further contended that such a direction
amounts to permitting an unconstitutional back-door entry into public
employment in derogation of Articles 14 and 16 of the Constitution of
India.
SUBMISSIONS ON BEHALF OF RESPONDENT
8. Per contra, learned counsel appearing on behalf of the
Respondent/Workman has opposed the present Writ Petition and advanced
the following submissions in support of the impugned Award:
i. Learned counsel submits that the Tribunal, upon appreciation of the
evidence on record, rightly concluded that the Respondent was functioning
as a full-fledged messenger/peon and not merely as a water supplier. It is
contended that the so-called water-supply bills were merely a device
adopted to camouflage the actual nature of employment and that the
relationship between the parties has to be determined on the basis of the
duties actually discharged.
ii. It is further submitted that the Bank’s own documents, including monthly
payments and conveyance vouchers, establish that the Respondent was
continuously discharging duties such as delivery and collection of cheques,
service of urgent correspondence and other outdoor assignments ordinarily
performed by a messenger. According to the Respondent, these documents
sufficiently support the finding that he was functioning as a workman underSignature Not Verified
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the ID Act.
iii. Learned counsel contends that the Respondent had completed more than
240 days of continuous service and that his services were terminated
without notice, payment in lieu thereof or retrenchment compensation as
required under Section 25-F of the ID Act. Reliance has been placed upon
Workmen of American Express International Banking Corporation v.
Management of American Express International Banking Corporation,
(1985) 4 SCC 71 to submit that statutory protection cannot be denied
merely in the absence of a formal appointment order.
iv. It is further submitted that under Para 522(4) of the Sastry Award, as
modified by the Desai Award and subsequent bipartite settlements,
termination of service could not have been effected without prior notice.
According to the Respondent, no such notice was issued and the
termination therefore stood vitiated.
v. Learned counsel further submits that the Petitioner’s plea regarding lack
of authority with the Branch Manager, absence of sanctioned posts and
surplus staffing cannot defeat statutory protection once the factum of
service stands established. It is argued that the Bank cannot simultaneously
claim surplus staff and justify entrustment of regular messenger duties to
the Respondent.
vi. Lastly, it is submitted that the Tribunal granted a balanced relief by
directing continuity of service without back wages and that such relief falls
within the scope of the reference. It is further contended that the judgments
relied upon by the Petitioner concerning illegal appointments and
regularization are distinguishable and do not govern a case concerning
violation of statutory safeguards under the ID Act.
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Vii. Learned counsel for the Respondent has also placed reliance upon
Deepali Gundu Surwase v. Kranti Junior Adhyapak Mahavidyalaya
(D.Ed.) and Ors., (2013) 10 SCC 324; General Manager, Electrical,
Rengali Hydro Electric Project, Orissa and Ors. v. Giridhari Sahu and
Ors., (2019) 10 SCC 695; K.V. Anil Mithra and Anr. v. Sree
Sankaracharya University of Sanskrit and Anr., (2022) 17 SCC 505; and
State of Gujarat and Anr. v. Munta Aalamkhan Nurbeg, (2020) 20 SCC
625 in support of the aforesaid submissions.
ISSUES FOR CONSIDERATION
Whether the impugned Award dated 13.12.2004 passed by
the Tribunal suffers from any illegality, perversity or
jurisdictional error warranting interference in exercise of
the supervisory jurisdiction of this Court under Articles 226
and 227 of the Constitution of India?
ANALYSIS AND FINDINGS
9. The Court has heard counsel for the parties and perused the material
placed on record.
10. At the outset, it is necessary to note that the jurisdiction exercised by
this Court under Articles 226 and 227 of the Constitution of India is
supervisory and not appellate in character. This Court does not sit as a court
of appeal over findings of fact returned by a Tribunal, nor does it re-appreciate
evidence merely because another view is possible on the material on record.
Interference is warranted only where the impugned award suffers from patent
illegality, perversity, jurisdictional error or manifest misapplication of settled
legal principles. Where the findings recorded by the Tribunal are founded
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upon appreciation of evidence and reflect a plausible view, such findings do
not warrant interference in exercise of writ jurisdiction. This position stands
settled by the Supreme Court in Syed Yakoob v. K.S. Radhakrishnan, AIR
1964 SC 477.
11. The Impugned Award dated 13.12.2004 was passed by the learned
Presiding Officer, Central Government, Industrial Tribunal-cum-Labour
Court-II, New Delhi in Industrial Dispute No. 107/1997, arising out of a
reference made by the Central Government on the question whether the
termination of the Respondent’s services with effect from 01.06.1995 was just
and fair and, if not, the relief to which he was entitled. Upon consideration of
the material on record, the Tribunal held that the Respondent was not engaged
merely for supply of water but was in fact performing duties of a messenger
or peon, including delivery and collection of cheques, service of urgent
correspondence and outdoor assignments; that the water supply bills were a
device to camouflage the true nature of the engagement and the payments
made through banker’s cheques reflected wages for duties actually performed;
that the Respondent had completed more than 240 days of service during the
relevant period; and that the termination of his services with effect from
01.06.1995 without notice, wages in lieu thereof or retrenchment
compensation was in violation of Section 25F of the ID Act and was neither
just nor fair. On the basis of these findings, the Tribunal directed
regularisation of the Respondent’s services with continuity from 01.06.1995,
without back wages. The operative portion of the Impugned Award reads as
under:
” The reference is replied thus:-
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The action of the management of the SBI in terminating the
services of Sh. Umed Singh w.e.f. 1.6.95 is neither just nor
fair. The workman applicant deserves to be regularised from
1.6.1995 without any back wages. The management is
directed to regularise the services of the workman without
any back wages but with continuity of service from 1.6.1995
within one month from publication of the award. In case of
default, the workman applicant will be entitled to 10%
interest on the back wages that will accrue.”
[…Emphasis Supplied]
12. The foundational question which arises for consideration is whether the
Respondent falls within the ambit of a “workman” under Section 2(s) of the
ID Act. The applicability of the protective provisions contained in Sections
25B and 25F of the ID Act, as also the maintainability of the industrial
reference itself, necessarily depends upon an affirmative determination of this
issue.
13. Section 2(s) of the ID Act defines a “workman” as any person employed
in an industry to perform manual, unskilled, skilled, technical, operational,
clerical or supervisory work for hire or reward, whether the terms of
employment are express or implied. The definition is deliberately broad.
Duties performed by a messenger or peon, involving physical movement,
delivery of documents and outdoor operational assistance, plainly fall within
the categories of manual and operational work contemplated under the
provision. Equally significant is the fact that the definition expressly extends
to implied contracts of employment. The absence of a formal appointment
letter or written contract does not, by itself, exclude a person from the ambit
of the provision. What remains material is whether labour was in fact rendered
under the supervision and control of the alleged employer and whether
remuneration, in whatever form, was received therefor.
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14. It is against this statutory backdrop that the stand of the Petitioner Bank
falls to be examined. The case before the Tribunal was that the Respondent
was merely engaged as an independent water vendor supplying water at the
branch premises and that conveyance charges paid on certain occasions
represented reimbursement of expenses incurred for delivery of documents.
The true nature of the engagement, however, cannot be determined from the
description assigned to it by the Petitioner Bank but must be gathered from
the substance of the relationship as disclosed from the material on record.The
nomenclature assigned by the employer, the mode of payment adopted or the
absence of formal documentation are not conclusive of the true nature of the
relationship where the material on record otherwise discloses a relationship
of employment. In Dharangadhra Chemical Works Ltd. v. State of
Saurashtra, AIR 1957 SC 264, the Supreme Court held that the prima facie
test for determining the relationship of master and servant is the existence of
the employer’s right to supervise and control the work, not merely in directing
what work is to be done but also the manner in which it is to be done. The
Court further held that the nature and extent of such control may vary from
business to business and is incapable of precise definition, and that the correct
approach is to consider, having regard to the nature of the work, whether there
was due control and supervision by the employer. In Silver Jubilee Tailoring
House v. Chief Inspector of Shops and Establishments, (1974) 3 SCC 498,
the Supreme Court held that no single test is determinative in deciding
whether a relationship is one of employment and that payment on a piece-rate
basis does not by itself negate the existence of an employer-employee
relationship.
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15. The Petitioner Bank has advanced a threshold submission that since the
Branch Manager lacked authority under the applicable service rules to appoint
subordinate staff, no relationship of employment could legally have come into
existence between the parties. This submission proceeds on an erroneous
equation between the validity of the mode of appointment and the factual
existence of an employment relationship. In Gujarat Electricity Board v.
Hind Mazdoor Sabha, (1995) 5 SCC 27 the Court held that while examining
the applicability of labour welfare legislation, the adjudicatory forum is
required to examine the real nature of the relationship between the parties and
not merely the form or description of the arrangement adopted by the
employer. Similarly, in K.V. Anil Mithra v. Sree Sankaracharya University
of Sanskrit, (2022) 17 SCC 505, the Supreme Court reiterated that merely
because an appointment was not made in accordance with the prescribed
procedure, a workman is not disentitled from claiming the protection of the
ID Act. The question whether the engagement was effected through a
constitutionally compliant process is distinct from the applicability of the
protective provisions of the ID Act and bears upon the nature of relief
ultimately to be granted. The effect of any illegality in the appointment on the
question of relief shall be considered separately.
16. Examined in the light of these abovementioned principles and
contentions, the documentary material placed on record clearly discloses the
nature of the relationship between the parties. The conveyance vouchers
produced before the Tribunal are records generated by the Petitioner Bank
itself and bear the signatures and authorisation of the Branch Manager. These
vouchers disclose that the Respondent was entrusted with duties including
delivery of clearing cheques to Bank of Baroda, Sansad Marg and Bank of
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India, Barakhamba Road; service of urgent correspondence to Chandralok
Building, Janpath; visits to the Reserve Bank of India, Sansad Marg, a
Government office at Rajendra Place and the SBI Overseas Branch; as well
as work in the Record Department of the branch during prescribed working
hours from 11:00 AM to 3:00 PM. Each voucher records the destination, the
nature of the assignment and the conveyance charges reimbursed upon due
authorisation by the Branch Manager. Significantly, the vouchers also bear
the word “Admitted” alongside the signatures of the Branch Manager,
indicating contemporaneous verification and approval of the claims in
connection with duties performed for the branch. Delivery of clearing cheques
and official correspondence to banks and public institutions necessarily
involved handling of official banking instruments and correspondence under
a degree of accountability and institutional trust wholly inconsistent with a
casual vendor relationship. Work in the Record Department during fixed
hours constitutes internal branch work. The vouchers further reflect that the
assignments were directed and supervised by the Branch Manager, with
specific destinations and conveyance expenses personally authorised by him.
This reflects supervision and control not merely over the work assigned, but
also the manner in which such duties were to be performed, as contemplated
in Dharangadhra Chemical Works Ltd. v. State of Saurashtra (supra). The
vouchers do not reflect payments made pursuant to independently raised
invoices or negotiated contractual consideration, but reimbursement of
conveyance expenses incurred while carrying out duties assigned by the
branch itself. The material on record does not disclose the characteristics
ordinarily associated with an independent contractor undertaking work on his
own account.
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17. The stand of the Petitioner Bank that the Respondent was engaged
exclusively for supplying water at the branch premises does not stand
reconciled with its own contemporaneous records reflecting repeated outdoor
assignments performed by the Respondent on official branch work during the
relevant period. Both sets of activities could not realistically have been
performed simultaneously throughout the working day by one person. The
conveyance vouchers themselves record specific journeys on identified dates
to different destinations. If such assignments were being regularly performed,
the case of the Respondent functioning merely as a continuous water supplier
becomes difficult to sustain on the Petitioner Bank’s own record. The
Petitioner Bank produced no vendor agreement, supply contract or other
commercial documentation consistent with an independent vendor
arrangement. A public sector institution maintaining systematic branch
records would ordinarily produce such material if it existed. Its absence
reinforces the finding that the arrangement between the parties was not that
of a vendor and purchaser but of employer and employee. The Petitioner Bank
also did not establish that any other person was discharging outdoor
messenger duties at the branch during the relevant period, a circumstance
noticed by the Tribunal which further supports the conclusion that it was the
Respondent who was performing those duties. The circumstance that the
Respondent may also have been entrusted with supplying water at the branch
premises does not detract from the documentary material establishing that he
was simultaneously performing duties ordinarily associated with a messenger
under the supervision and control of the branch establishment.
18. The cumulative effect of the nature of duties performed, the continuity
of engagement, the recurring pattern of payments and the degree of
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supervision exercised by the Branch Manager sufficiently establishes the
existence of an implied contract of service between the parties and the
Respondent’s status as a workman within the meaning of Section 2(s) of
the ID Act. The findings returned by the Tribunal on this issue are well-
founded on the documentary material on record, reflect a legally sustainable
appreciation of the evidence and do not warrant interference.
19. The next question which arises for consideration is whether the
Respondent had rendered continuous service so as to attract Section 25F of
the ID Act. The principal contention of the Petitioner Bank is that the
Respondent was engaged only intermittently for supply of water and
occasional delivery of urgent papers and that the material placed on record
was insufficient to establish completion of 240 days of service within the
meaning of Section 25B of the ID Act.
20. Section 25B of the Act incorporates a deeming fiction intended to
protect workmen whose employment, though lacking formal permanency, is
in substance continuous and regular. Section 25B(2) of the Act provides that
where a workman has not been in uninterrupted continuous service for one
year, he shall nonetheless be deemed to be in continuous service for one year
if, during the twelve calendar months preceding the relevant date, he has
actually worked under the employer for not less than 240 days. The provision
does not require strict proof of each individual working day; the focus is upon
whether the material on record discloses continuity of engagement during the
relevant period.
21. The expression “actually worked under the employer” has received a
broad and purposive interpretation from the Supreme Court. In Workmen of
American Express International Banking Corporation v. Management of
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American Express International Banking Corporation, (1985) 4 SCC 71, it
was held:
“……….This expression, according to us, cannot mean those
days only when the workman worked with hammer, sickle or
pen, but must necessarily comprehend all those days during
which he was in the employment of the employer and for
which he had been paid wages either under express or
implied contract of service or by compulsion of statute,
standing orders etc. The learned counsel for the Management
would urge that only those days which are mentioned in the
Explanation to Section 25-B(2) should be taken into account
for the purpose of calculating the number of days on which
the workmen had actually worked though he had not so
worked and no other days. We do not think that we are
entitled to so constrain the construction of the expression
‘actually worked under the employer’. The explanation is only
clarificatory, as all explanations are, and cannot be used to
limit the expanse of the main provision. If the expression
‘actually worked under the employer’ is capable of
comprehending the days during which the workman was in
employment and was paid wages-and we see no impediment
to so construe the expression-there is no reason why the
expression should be limited by the explanation. To give it
any other meaning then what we have done would bring the
object of Section 25-F very close to frustration. ”
22. The legislative focus is accordingly upon continuity of employment
and receipt of wages, and not upon a mechanical computation of days of
physical labour.
23. The scope and object of Section 25B of the ID Act were explained by
the Supreme Court in Surendra Kumar Verma v. Central Government
Industrial Tribunal-cum-Labour Court, (1980) 4 SCC 443, wherein it was
held that it is not necessary for the workman to establish uninterrupted service
for one whole year and that the deeming fiction embodied in Section 25B(2)
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of ID Act was introduced to avoid a narrow or technical construction of
continuous service following the 1964 amendment to the Act. The Supreme
Court in Mohan Lal v. Management of Bharat Electronics Ltd., (1981) 3
SCC 225, further clarified that the relevant date for computation is the date
of termination and that the inquiry must proceed backwards over the
immediately preceding twelve calendar months to ascertain whether the
workman had rendered service for not less than 240 days during that period.
24. In the light of the aforesaid principles, determination of
continuous service under Section 25B of the Act cannot rest upon an
isolated day-to-day examination of the record detached from the overall
nature of the engagement. Where the material on record discloses a
substantially continuous engagement during the relevant period,
completion of 240 days of service must be assessed on the cumulative
effect of the duration of engagement, the nature of duties performed, the
regularity of assignments and the continuity reflected from the
contemporaneous record.
25. The burden of establishing completion of 240 days rests upon the
workman. In Surendranagar District Panchayat v. Jethabhai Pitamberbhai,
(2005) 8 SCC 450, the Supreme Court held that the workman is required to
adduce evidence in support of his contention that he has complied with the
requirements of Section 25B of the ID Act. The Supreme Court in the State
of M.P. v. Arjunlal Rajak, (2006) 2 SCC 711, reiterated that the initial burden
in this regard rests upon the workman.
26. In the facts of the present case, the Respondent’s engagement
commenced on 06.07.1994 and came to an end on 31.05.1995, the termination
taking effect from 01.06.1995. The statutory computation period under
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Section 25B of the ID Act would therefore extend from 01.06.1994 to
31.05.1995, within which the Respondent’s entire tenure of engagement
substantially falls. In the context of an engagement extending over nearly
eleven months within a banking establishment, the duration and continuity
reflected from the material on record cannot be ignored while assessing
compliance with the requirement of 240 days under Section 25B of the ID
Act.
27. At this stage, the issue is not whether each individual day of work is
evidenced by a separate voucher or document, but whether the material on
record, viewed cumulatively, establishes that the Respondent remained
continuously engaged and was regularly utilised by the branch throughout the
relevant period. As explained in Workmen of American Express
International Banking Corporation v. Management of American Express
International Banking Corporation, (1985) 4 SCC 71, the expression
“actually worked under the employer” is not confined merely to days of
physical labour but extends to the period during which the workman remained
in employment under the employer.
28. The nature of the engagement further fortifies the conclusion emerging
from the record. Even according to the Petitioner Bank’s own case, the
Respondent was engaged, inter alia, for supplying water to the branch
premises. Water supply to a functioning bank branch cannot be characterised
as an intermittent, seasonal or contingent activity. It is a recurring operational
requirement arising on every working day. An arrangement for supply of
water to branch premises situated on the first and second floors over a period
extending to nearly eleven months inherently indicates regular and recurring
presence connected with the day-to-day functioning of the branch. Such a
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requirement itself renders the theory of isolated or sporadic engagement
difficult to sustain.
29. This conclusion is further supported by the contemporaneous
conveyance vouchers placed on record. The vouchers disclose recurring
assignments entrusted to the Respondent throughout the engagement period,
including delivery of clearing cheques to different bank branches, carriage of
urgent correspondence, visits to the Reserve Bank of India, attendance at the
Zonal Office and work relating to the SBI Overseas Branch. These
assignments recur across the relevant period without material interruption, the
vouchers extending into May 1995 immediately preceding the discontinuance
of the engagement. The vouchers are not private documents generated by the
Respondent; they are contemporaneous internal branch records bearing the
signatures and authorisation of the Branch Manager and generated in the
ordinary course of the Bank’s functioning. Each voucher records the
assignment entrusted, the destination concerned and the conveyance amount
sanctioned by the branch. The record further includes vouchers relating to
work performed by the Respondent in the branch Record Department during
specified working hours, indicating utilisation of the Respondent for internal
branch functions in addition to outdoor assignments.
30. The documentary record before the Tribunal also reflects a consistent
pattern of utilisation throughout the relevant tenure. The banker cheque
payment entries disclose recurring monthly disbursements to the Respondent
ranging from Rs.600 to Rs.828 from August 1994 till May 1995. These
payments were made through the Petitioner Bank’s official payment
mechanism and authorised at the branch level without interruption. Read
cumulatively, the recurring assignments reflected from the conveyance
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vouchers together with the uninterrupted pattern of monthly payments
disclose a structured and sustained utilisation of the Respondent for duties
integrally connected with the day-to-day functioning of the branch throughout
the period from July 1994 till May 1995.
31. Once the Respondent produced contemporaneous records originating
from the Petitioner Bank’s own branch, disclosing recurring assignments and
regular payments during the relevant period, the initial burden resting upon
him stood discharged. The Petitioner Bank, despite disputing continuity of
service, did not produce any attendance, establishment or other branch records
clarifying the duration and continuity of the Respondent’s engagement. This
omission assumes significance while appreciating the evidence on record,
particularly since such records would ordinarily be maintained and retained
by the Petitioner Bank in the regular course of its functioning.
32. It is also material that although the Petitioner Bank asserted that regular
messenger staff was available at the branch, no material was produced
identifying any such employee or showing that the outdoor assignments
reflected in the vouchers were in fact being performed by anyone other than
the Respondent during the relevant period. The absence of such material is a
relevant circumstance while appreciating the continuity and nature of the
Respondent’s engagement.
33. Industrial adjudication under the ID Act cannot proceed in disregard of
the practical realities of employment. The object underlying Section 25B of
the ID Act is to ensure that the protection embodied in Section 25F of the Act
is not defeated by an unduly technical or rigid approach to proof of continuous
service, where the material on record otherwise discloses sustained and
regular engagement during the relevant statutory period.
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34. The tenure of engagement extending over nearly eleven months, the
perennial nature of the work, the uninterrupted pattern of recurring
assignments reflected from the conveyance vouchers across every month of
the engagement, the monthly banker cheque payments from August 1994
through May 1995, the absence of any other person performing these duties
at the branch during this period, and the complete failure of the Petitioner
Bank to produce any rebuttal evidence from records exclusively within its
possession taken cumulatively sufficiently establish that the Respondent is
shown to have rendered service meeting the statutory requirement of 240
days within the twelve calendar months preceding the termination of his
engagement on 01.06.1995. The finding of the Tribunal on this issue is
founded upon a proper appreciation of the material on record and
warrants no interference.
35. The Petitioner Bank further contended that Section 25F of the Act was
inapplicable on the ground that the Respondent had not been appointed
through a regular recruitment process or against a sanctioned post. However,
the Respondent having been found to be a workman who had rendered
continuous service within the meaning of Section 25B of the Act, the
discontinuance of his engagement attracted the requirements of Section 25F
of the ID Act.
36. Section 2(oo) of the ID Act defines retrenchment broadly as
termination of the service of a workman for any reason whatsoever, except in
situations specifically excluded under the provision. The discontinuance of
the Respondent’s engagement on 01.06.1995 did not fall within any such
exclusion and therefore constituted retrenchment within the meaning of
Section 2(oo), thereby attracting Section 25F of the Act.
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37. Section 25F of the ID Act prescribes certain conditions precedent to the
retrenchment of a workman who has been in continuous service for not less
than one year, including a workman deemed to be in continuous service by
virtue of having worked for not less than 240 days within the meaning of
Section 25B of the Act. The provision mandates: (i) one month’s notice in
writing indicating the reasons for retrenchment or wages in lieu thereof; (ii)
payment of retrenchment compensation equivalent to fifteen days’ average
pay for every completed year of service; and (iii) service of notice upon the
appropriate Government in the prescribed manner. The mandatory nature of
these requirements is well settled. In Anoop Sharma v. Executive Engineer,
Public Health Division No. 1, Panipat, (2010) 5 SCC 497, the Supreme
Court held:
“We have no hesitation to hold that termination of service of
an employee by way of retrenchment without complying with
the requirement of giving one month’s notice or pay in lieu
thereof and compensation in terms of Sections 25-F(a) and
(b) has the effect of rendering the action of the employer as
nullity and the employee is entitled to continue in employment
as if his service was not terminated.”
38. Examined in the light of the aforesaid requirements, the material on
record discloses that no notice in writing was issued to the Respondent prior
to the discontinuance of his engagement on 01.06.1995, no retrenchment
compensation was paid and no notice was served upon the appropriate
Government in the prescribed manner. The mandatory requirements
prescribed under Section 25F of the Act were thus not complied with. The
finding returned by the Tribunal that the discontinuance of the
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Respondent’s engagement was effected in violation of Section 25F is
borne out from the material on record and does not warrant interference.
39. The Tribunal has rightly held that the Respondent was a workman and
that his services were retrenched in violation of the mandatory requirements
prescribed under Section 25F of the ID Act. However, it committed an error
in granting the consequential relief of regularisation and permanent
absorption. The dispute referred for adjudication concerned the legality of the
termination of the Respondent’s engagement and the consequential relief
arising therefrom. Mere completion of 240 days of service or non-compliance
with Section 25F of the ID Act does not, by itself, confer any vested right to
regularisation or permanent absorption in service. In Secretary, State of
Karnataka & Ors. v. Umadevi , (2006) 4 SCC 1, the Constitution Bench held
that courts cannot ordinarily direct regularisation or permanent absorption of
persons engaged de hors the constitutional scheme of public employment and
without following the prescribed recruitment process. The Petitioner Bank,
being an instrumentality of the State within the meaning of Article 12 of the
Constitution, is required to make appointments in accordance with the
prescribed recruitment framework. The material on record does not disclose
the existence of any sanctioned post against which the Respondent was
engaged or that the engagement was preceded by any recognised recruitment
or selection process.
40. The Tribunal, however, proceeded to direct regularisation of the
Respondent’s services with effect from 01.06.1995 even though no specific
relief seeking regularisation or permanent absorption had been claimed by the
Respondent in the industrial dispute. In doing so, the Tribunal erred in
treating reinstatement consequent upon an illegal termination as equivalent to
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regularisation in service. While reinstatement restores the workman to the
position held prior to termination, regularisation confers permanent status in
service. The direction of regularisation, in the absence of any specific claim
for such relief and beyond the scope of the reference, therefore exceeded the
limits of the Tribunal’s adjudicatory jurisdiction.
41. Learned counsel for the Respondent placed reliance upon Deepali
Gundu Surwase v. Kranti Junior Adhyapak Mahavidyalaya (D.Ed.), (2013)
10 SCC 324; General Manager, Electrical, Rengali Hydro Electric Project,
Orissa v. Giridhari Sahu, (2019) 10 SCC 695; K.V. Anil Mithra v. Sree
Sankaracharya University of Sanskrit, (2022) 17 SCC 505; and State of
Gujarat v. Munta Aalamkhan Nurbeg, (2020) 20 SCC 625. The said
decisions, however, arose in materially distinct factual contexts involving
employees whose appointments were otherwise recognised or validly made.
None of the aforesaid decisions concerned an engagement in a public sector
establishment not preceded by any recognised recruitment process or involved
a direction for regularisation in the absence of a sanctioned post or prescribed
selection procedure. The said decisions therefore do not assist the Respondent
on the question of relief in the facts of the present case.
42. In view of the aforesaid discussion, the direction of regularisation
contained in the impugned Award cannot be sustained.
43. The question which then survives is with regard to the appropriate
consequential relief. It is now well settled that reinstatement with continuity
of service and back wages does not automatically follow in every case where
termination is found to be in violation of Section 25F of the ID Act. In Jagbir
Singh v. Haryana State Agriculture Marketing Board, (2009) 15 SCC 327,
the Supreme Court recognised that, depending upon the facts and
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circumstances of the case, award of monetary compensation in lieu of
reinstatement may adequately meet the ends of justice.
44. In the present case, the Respondent remained engaged for a limited
period of approximately eleven months between July 1994 and May 1995
through an engagement not preceded by any recognised recruitment process.
More than three decades have elapsed since the discontinuance of the
engagement and the Tribunal itself declined to award back wages. Having
regard to the period and nature of the engagement, the complete non-
compliance with Section 25F of the ID Act at the time of discontinuance, the
considerable lapse of time and the limited nature of the illegality established,
this Court is of the view that award of lump sum monetary compensation
would constitute an appropriate consequential relief in the facts and
circumstances.
CONCLUSION
45. Accordingly, the direction of regularisation contained in the impugned
Award is set aside and substituted with a direction to the Petitioner Bank to
pay to the Respondent a lump sum compensation of Rs.1,00,000/- towards
full and final settlement of all claims arising out of the discontinuance of his
engagement. In determining the quantum of compensation, this Court has
taken into consideration the duration of the engagement, the nature of duties
performed, the lapse of more than three decades since the discontinuance of
the engagement, the absence of any regular recruitment process, and the fact
that the Tribunal itself declined to award back wages. The aforesaid amount
shall be paid within a period of eight weeks from the date of receipt of a
certified copy of the present judgment, failing which it shall carry simple
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interest at the rate of 8% per annum from the expiry of the said period till
realisation.
46. The writ petition is accordingly partly allowed in the aforesaid terms.
All pending applications, if any, shall stand disposed of. There shall be no
order as to costs.
SHAIL JAIN
JUDGE
JULY 07, 2026
RM
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