An Order Of Reinstatement In Service Does Not Guarantee Payment Of Back Wages Automatically: SC Reiterates

The Supreme Court while dealing with an appeal filed by a terminated employee explained that mere reinstatement of a job does not guarantee back wages automatically and that there is a burden of proof on the employee to show he was entitled to back wages.

A Two Judge Bench of Justice Abhay S. Oka and Justice Rajesh Bindal held that “The law is very well settled. Even if Court passes an order of reinstatement in service, an order of payment of back wages is not automatic. The Appellant discharged the burden on him by establishing that he was unemployed.”

Further, while giving the order of paying back wages, the Court stated that “considering the facts of the case, it will be appropriate if a sum of Rs.3 lakhs is ordered to be paid to the appellant in lieu of back wages”.

AOR P. George Giri appeared for the Appellant while AOR Dr. Monika Gusain appeared on behalf of the Respondent.

In this case, the Appellant was employed with the Respondent, Delhi Transport Corporation as a conductor. A Charge Sheet was served to the Appellant on September 8, 1992 wherein it was alleged that the Appellant took ₹ 4 from two passengers but did not provide them with a ticket.

Subsequently, the Appellant was terminated from service on June 14, 1996. The Appellant challenged the internal enquiry and termination order of the Respondent in a Labor Court. By the award dated March 17 2009, the Labor Court came to the conclusion that the charge against the appellant was not established by the respondent. The Court directed the Respondents to reinstate the Appellant. However, due to lack of proof of unemployment, the Court denied back wages to the Appellant.

The Appellant challenged the order of the Labor Court by a writ petition in Delhi High Court which was dismissed. The Appellant challenged it again in front of a Division Bench which was dismissed again.

Finally, the Appellant challenged the order in the Supreme Court.

The main issue before the Apex Court was whether the Appellant was entitled to receive the back wages. The Court placed reliance on the case of National Gandhi Museum v. Sudhir Sharma, 1 (2021) 12 SCC 439, and stated that “an order of payment of back wages is not automatic It all depends on the facts and circumstances of the case. “

In the case, the Court found instances serving as proof of the Appellant’s unemployment wherein the Court said “there are two factors in favor of the appellant. In the statement of claim, it is specifically asserted that till August 1997 when the statement of claim was filed, the appellant found it difficult to get employment and in fact he was unemployed. The second aspect is that there is a cross-examination of the appellant on this issue by the Advocate for the respondent and in the cross-examination, the appellant denied that he had a sufficient source of income to look after his family”.

Looking at the facts in the instant issue, the Court directed the Respondent to pay a sum of ₹3 lakhs as back wages to the Appellant within the period of 2 months, failing which an interest of 9% per annum will be levied.

Accordingly, the Court partly allowed the appeal.

Cause Title: Ramesh Chand v. Management of Delhi Transport Corporation

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