Employee Terminated Due To Criminal Prosecution Not Automatically Entitled To Back Wages Upon Acquittal In Appeal: Gujarat High Court Reiterates

The Gujarat High Court on Monday reiterated that an employee who was terminated from services on account of criminal prosecution, would not be able to claim back wages automatically on the ground that he was subsequently acquitted.

The single judge bench of Justice Sandeep N. Bhatt observed:

“In view of peculiar facts of the present case, it is well settled that grant of back wages is never an automatic relief to follow, the theory of ‘no work, no pay’ would apply.”

It was the case of the petitioner that he was appointed as the Sanitary Inspector by Ahmedabad Municipal Corporation (AMC) and was put under suspension on March 12, 1997 by AMC pursuant to the allegations against him under Prevention of Corruption Act, 1988.

Subsequently the petitioner was tried and convicted by the competent court for the said allegations vide judgement dated November 27, 2000 and he was dismissed from the service by AMC on July 31, 2001.

However, the Appellate Court acquitted the petitioner vide judgement dated June 27, 2018 and in the meantime, the petitioner has attained the age of superannuation on July 31, 2017.

After his acquittal, the petitioner requested the AMC to grant all the benefits of his service till the date of superannuation, which was denied by the AMC and granted notional benefits.

Hence, the petitioner approached the High Court.

The counsel for the petitioner submitted that neither departmental inquiry was initiated nor any notice or charge-sheet was issued against the petitioner by the AMC.

It was further submitted that AMC cannot withhold gratuity of the petitioner after the petitioner was superannuated.

The counsel for the AMC contended that petitioner has been granted notional benefits by AMC and accordingly paid all the benefits which was accepted by the petitioner without raising any objection or protest at that relevant time.

It was further submitted that during the entire period when services of the petitioner were terminated and till the date of superannuation, he has never worked and hence, on the basis of ‘no work, no pay’, the petitioner was not entitled for the wages as claimed for.

The court observed that the suspension as well as the dismissal period was counted as continuous-on duty by the AMC and accordingly, counted as notional for the purpose of granting benefits to the petitioner.

The court noted:

“the respondent-AMC had paid all the benefits notionally i.e. pension, gratuity, leave encashment etc., keeping in mind the principle that ‘no work, no pay’ which was accepted by the petitioner without any protest or objection.”

The court relied upon the judgement in Meenaben Kantilal Shrimali v. Ahmedabad Municipal Corporation, Special Civil Application No.12740 of 2016 dated July 31, 2018 in which the Gujarat High Court held:

“The employee who had not worked for the said particular period would not be entitled to, and the employer who was unable to take work for the said period, would not be saddled with the payment of the salary in form of back wages for the said part…For an employee who was terminated from services on account of criminal prosecution, would not be able to claim back wages automatically and as a matter of course on the ground that he was subsequently acquitted.”

Accordingly, the court dismissed the petition by holding that grant of back wages is never an automatic relief to follow and an employee who was dismissed from service on account of criminal prosecution cannot claim back wages merely on the ground that he was later on acquitted.

However, the court directed the AMC to pay the remaining notional benefits to the petitioner within four weeks.

Similar Read: Employee Not Entitled To Full Back Wages On Acquittal, Unless His Prosecution Was Found Malicious: Supreme Court

Case Title: Rajnikant Motibhai Patel v. Ahmedabad Municipal Corporation

Case Citation: 2023 Livelaw (Guj) 52

Coram: Justice Sandeep N. Bhatt

Click Here to Read/Download Judgment