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Vashrambhai Dhanabhai Vegad v. State of Gujarat & Ors.

Civil Appeal · Neutral citation not assigned (Civil Appeal No. 11772 of 2016)Decided 5 Dec 2016
Civil Appeal No. 11772 of 2016
Justice Kurian Joseph · Justice Rohinton Fali Nariman

Background

A Labour Court had awarded the appellant reinstatement in service along with 20% back-wages. The High Court interfered with that award and substituted it with a lump-sum compensation of Rs. 50,000 instead of reinstatement. The appellant, who had intermittently worked for about twenty years, challenged the High Court's order as inadequate.

Decision Breakdown

The Supreme Court agreed with the High Court that reinstatement was not the appropriate relief in this case, but found the Rs. 50,000 compensation awarded far too meagre given the appellant had worked, albeit intermittently, for twenty years. Weighing the facts, the Court raised the compensation to Rs. 5,00,000, making clear this figure was based on the peculiar facts of this case and was not to be treated as a precedent for other cases. It directed payment within two months, with 12% annual interest and personal liability for responsible officials in case of delay.

Lesson Learnt

Even where reinstatement is denied, a court will look closely at the length and nature of a worker's actual service to ensure the compensation substituted for it is realistic and not merely a token amount, though the specific sum fixed in one case is not meant to set a general rate for others.

Official source (sci.gov.in)View Judgment (PDF)

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