Industrial Dispute | Employer's Head Office In Delhi Not Enough To Confer Territorial Jurisdiction In Delhi Labour Courts: High Court

The Delhi High Court has held that the situs of employment and the place where termination takes effect are the determinative factors for identifying the “appropriate Government” in industrial disputes.

Justice Shail Jain observed that the mere existence of an employer's office in Delhi would not by itself confer territorial jurisdiction on Delhi labour authorities.

“The existence of a business address at Delhi at some anterior point of time does not establish that the industrial dispute which arose in November 2009 had any direct, proximate or substantial nexus with Delhi at the relevant point of time. The relevant inquiry for determining territorial jurisdiction is not whether the management at some point of time carried on business from Delhi, but whether the industrial dispute itself substantially arose within the territorial jurisdiction of Delhi when the cause of action accrued,” it held.

The Court added, “mere existence of a head office, branch office or business establishment at Delhi would not ipso facto confer territorial jurisdiction upon the Labour Court at Delhi where the employment and alleged termination of the workman were admittedly situated elsewhere.”

The bench made the observation while dismissing a writ petition filed by workman challenging a Labour Court award which had held that the Delhi government was not the “appropriate Government” competent to refer his industrial dispute for adjudication.

Petitioner claimed that he had worked with multiple concerns allegedly operating under the same management, including M/s Delhi Industrial Syndicate, M/s Asian Engineering Company, M/s Enicar Machine (India) and M/s Precision Tanks and Vessels Pvt. Ltd. He alleged that he was orally terminated from service in November 2009 without any written order or inquiry.

Before the Labour Court, the management objected to the maintainability of the proceedings in Delhi, arguing that the petitioner was last employed at the Faridabad establishment and that the alleged termination had also taken place there.

The Labour Court accepted the objection and held that Haryana, and not Delhi, was the appropriate jurisdiction for adjudication of the dispute. The workman then challenged the award before the High Court.

Upholding the Labour Court's decision, the High Court observed that in disputes relating to termination of service, courts have consistently treated the place where the workman was last employed and where the termination operated as the crucial factor for determining territorial jurisdiction.

“In disputes arising out of termination of service, it is ordinarily the place where the workman was lastly employed and where the alleged termination took effect that constitutes the determinative factor for deciding territorial jurisdiction. The principle is founded upon the rationale that the industrial dispute substantially crystallises at the place where the employment subsisted and where the adverse employment action operated against the workman,” it observed.

In the present case, the Court relied on the petitioner's own pleadings that he was working at Faridabad, Haryana on November 27, 2009, and that he was directed there not to report for duty from the next day.

Calling this a clear admission regarding the “situs of employment”, the Court held that the industrial dispute substantially arose within the territorial jurisdiction of Haryana.

“Once the Petitioner/workman himself admitted that he was discharging duties at Faridabad, Haryana on the date of alleged termination and that the alleged termination operated there, the learned Labour Court cannot be faulted for holding that the industrial dispute substantially arose within the territorial jurisdiction of the State of Haryana,” the Court observed.

The petitioner had argued that the management had substantial business links with Delhi and relied on old delivery challans and bills carrying Delhi addresses.

Rejecting this contention, the Court held that such documents from 1980 and 1996 could not establish a contemporaneous or substantial nexus with Delhi at the time of the alleged termination in 2009.

As such, the Court dismissed the writ petition.

Appearance: Mr. Triloki Pandit, Adv. for Petitioner; Ms. Diya Kapur, Sr. Adv. with Mr. Aditya Ladha, Mr. Naibedya Dash, Advs for Respondent

Case title: Rajeshwar Dayal Aggarwal v. M/S Enicar Machine (India)

Case no.: W.P.(C) 9849/2016

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