Spread the love
CITATIONCivil Appeal No. 9008 of 2022 


The Division Bench of the Karnataka High Court (M.R. Shah) ruled that the matter at issue had not been determined by the Court of First Instance and was therefore not subject to proceeding under section 33-C.2. The Court further held that the employee could not be denied their back wages when the Court eventually confirmed the reinstatement order. The Court noted that it was the employer – the bank – who had obtained the stay and the reinstatement order became final. Therefore, why should the employee suffer when the bank had first obtained the stay and then the order became final?


The appellant was employed by the defendant bank. He was dismissed by the bank in a departmental proceeding. He challenged the dismissal order before the central government industrial tribunal under section 10(2) of the industrial disputes act. The central government industrial tribunal (CGIT) annulled the dismissal order and issued an order for his reinstatement along with half of his wages, withholding four annual increases with cumulative effect from the date on which the order was handed down on July 18, 2007, to the date on which he was reinstated. Before the High Court, CGIT’s order was challenged. The single bench of the HC confirmed the reinstatement order but reduced the number of back wages from Rs 50,000 to Rs 25,000. The division bench of the HC also confirmed the reinstatement decision but declared that the appellant did not qualify for back wages. The appellant filed a Special Leave Petition against the order on 12 July 2013, which was rejected. Finally, the order of 18 July 2007 of CGIT became final. Since the bank did not pay the total wages from the order to the reinstatement date, the appellant filed an application under the ID Act once again. CGIT decided in favour of the appellant. However, upon the respondent bank’s appeal against the order of the CGIT, the HC annulled the order on the grounds that CGIT did not have jurisdiction to decide on the application under the Act. The High Court relied on the case of Mumbai Chemical Industries vs. (Deputy Labour Commissioner & (Anr.) This appeal is filed before the Supreme Court in opposition to the contested judgment of the High Court.


From the date of the CGIT’s decision to grant reinstatement on 18 July 2007 to the date of actual reinstatement on 23 September 2013, will the appellant be entitled to receive the full wages?


The learned counsel for the appellant argued that the ratio was incorrectly applied by the High Court in the context of the case of Bombay Chemical Industries. Drawing on the Apex Court’s judgment in the case of Namer Ali Choudhary and Others. v. central inland water transport corporation Ltd. & anr. [1997] 4 SC 575], the learned counsel argued that once an award is made, the question of the amount of compensation to be paid under the award would be the subject of a proceeding under section 33-C (2) of ID Act. It was also argued that if the High Court’s order were to be confirmed, the worker/employee would suffer as a result of his or her own actions. Furthermore, the learned counsel claimed that the fact that proceedings are still pending does not invalidate the requirement for reinstatement in relation to the award.


The learned counsel for the respondent argued that the High Court stayed the application of the award handed down on 18 July 2007. However, the learned counsel argued that the award of 18 July 2007 merges with a judgement and order of 12 July 2013. As a result, only the judgment and order of the division bench of high court of 12 July 2013 can be enforced. Therefore, the appellant is not entitled to recover wages for that period.

It was further argued that due to the provisions of Section 17 B of the Law, the last drawn wages of the appellant for the stay period of the award were paid. Therefore, the appellant was not eligible for full back wages for that period.


The Hon’ble Court held that the final order is always the one that is passed at the end of the proceedings. The interim order is always the final decision. So, just because there is an interim order/staying of the reinstatement order while the proceedings are in progress, the employee – the appellant cannot be refused the back wages/ wages when the final order of reinstatement is confirmed by the court. According to the judgment, the appellant is entitled to receive the full wages and all emoluments as from the date of the order reinstatement order (18.07.2007) to the date of the actual reinstatement order (23.09.2013), subject to the adjustment/deduction of the amount already paid pursuant to Section 17B of ID Act.


The Court held that the interim order is always applicable to the final order. Therefore, it cannot be accepted that just because there was a stay on the reinstatement order while the suit was in progress, the applicant can be refused the back wages when the Court finally confirmed the reinstatement order. The Court also held that the principle of merger cannot be applied to this case. The Court also found that the High Court erroneously applied the ratio of the Mumbai Chemical Industries Case. The Court further held that in the present case, the claim of the applicant was not upheld as the appellant had brought the matter before the CGIT and the CGIT had passed the appropriate order after hearing the matter. The fact that the appellant received the last drawn wages under the ID Act for the period during which the reinstatement order was stayed does not mean that he does not receive any wages for that period. However, the amount paid may be deducted or adjusted when paying the wages.


The Apex Court took note of the foregoing considerations and set aside the judgment of the Honourable High Court. The Apex Court ordered the bank to remunerate the appellant in full with all the entitlements from 18 July 2007 to 12 July 2013, taking into account the amount already remunerated under Law No 17B of ID Act.


  1. https://www.verdictum.in/court-updates/supreme-court/employee-back-wages-stay-on-reinstatement-1452393
  2. https://www.latestlaws.com/latest-news/sc-interim-orders-are-always-subject-to-the-final-order-that-may-be-passed-finally-while-terminating-the-proceedings-read-judgment-193122
  3. https://indiankanoon.org/docfragment/64240974/?formInput=slp%20%20%20doctypes%3A%20karnataka
  4. https://updates.manupatra.com/roundup/contentsummary.aspx?iid=41426

This article is written by akshita jain student of Bharati Vidyapeeth university department of law, New Delhi ; intern at legal vidhiya

Disclaimer: The materials provided herein are intended solely for informational purposes. Accessing or using the site or the materials does not establish an attorney-client relationship. The information presented on this site is not to be construed as legal or professional advice, and it should not be relied upon for such purposes or used as a substitute for advice from a licensed attorney in your state. Additionally, the viewpoint presented by the author is of a personal nature.


Leave a Reply

Avatar placeholder

Your email address will not be published. Required fields are marked *