To Pass Order Of Compulsory Retirement, Employer's Subjective Satisfaction Should Be Based On Material Available On Employee's Service Record: Rajasthan HC

The Rajasthan High Court has held that an employer or Government can indeed issue an order of compulsory retirement based on their subjective satisfaction, however, this subjective satisfaction must be documented based on the information present in the employee's service record.

In that context, the Bench of Justice Rekha Borana observed that, "the satisfaction of the employer has to be subjective. The said subjective satisfaction should have been recorded based on the material available on the employee’s service record. Further, it is also the settled position of law that such orders can be interfered with if the same is (a) malafide or (b) based on no evidence or (c) so arbitrary in the sense that no reasonable person would form a requisite opinion on the given material, in short, if it is found to be a perverse order."

Counsel Avin Chhangani and Counsel Prenal Lodha appeared for the petitioners, while Counsel Sanjeet Purohit and Counsel Twinkle Purohit.

The case involved a decision by the Industrial Tribunal and Labour Court in Udaipur, which ruled in favor of a workman, declaring that his compulsory retirement order dated October 16, 2001, was invalid. The Tribunal decided that the workman's service should be considered continuous from October 16, 2001, until his retirement, entitling him to full salary and benefits for this period. The Management, feeling aggrieved, appealed to the Rajasthan High Court.

The Management argued that the Tribunal's decision was based on the absence of certain documents, leading to an adverse inference against them. They claimed that the Screening Committee's order, which justified the compulsory retirement, was on record and showed the rationale behind the decision. They also mentioned that the workman's complete service file had gone missing during the Tribunal's proceedings, preventing the production of relevant documents, but these were later submitted to the Court with the rejoinder.

The Management also pointed out the delay in the workman's actions. The workman did not seek a review of the compulsory retirement until May 31, 2004, and waited for the Governor's decision for four years before filing a writ petition in 2007. This petition was dismissed on September 4, 2009, with instructions to approach the appropriate forum, yet the workman only raised the claim in 2015.

In response, the workman argued that the delay in filing the claim was not detrimental. He had initially sought a review from the Governor in 2004, following procedural guidelines for government employees facing compulsory retirement. The prolonged period without a decision led to the 2007 writ petition, seeking a timely resolution. After the dismissal of this petition in 2009, the workman promptly pursued his claim, leading to the 2015 reference. He emphasized that delays in labor disputes are not necessarily fatal and that relief can be adjusted rather than denied.

The workman further argued that the compulsory retirement order was issued without a hearing or reason, making it illegal.

The High Court observed that, "no evidence whatsoever, was led by the petitioner Corporation before the learned Labour Court to prove the subjective satisfaction of the Corporation in passing the order of compulsorily retirement of the respondent. Even before this Court, no document/order of punishment related to any previous conduct of the respondent has been submitted."

Subsequently, the Court ordered that appropriate orders for release of the gratuity amount as well as the other retiral benefits be passed and the same be paid to the respondent workman within a period of three months.

Cause Title: Chairman, Rajasthan State Road Transport Corporation & Anr vs Kalu Ram Sharma

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