The heirs of a deceased PSU employee, who had challenged his termination from service nearly 32 years ago, have got relief from the Supreme Court which directed the company to pay them 60% of his wages from his sacking till his superannuation.
The apex court's direction came while dismissing the PSU, Balmer Lawrie Investments Ltd's (BLIL) appeal challenging two decisions of Calcutta high court terming the company as a state and amenable to writ jurisdiction.
It also disapproved the "hire-and-fire policy" of the company.
A bench of justices BS Chauhan and V Gopala Gowda upheld the high court's decisions after considering factors like the company's formation, objectives, functions, management and control, financial aid received by it, etc and said the "cumulative effect" of the these factors would make BLIL amenable to writ jurisdiction.
"In order to determine whether the appellant company (BLIL) is an authority under Article 12 of the Constitution, we have considered factors like the formation of the appellant company, its objectives, functions, its management and control, the financial aid received by it, its functional and administrative control and have come to the conclusion that the cumulative effect of all the aforesaid facts in reference to a particular company i.e. the appellant, would render it as an authority amenable to the writ jurisdiction of the high court," the bench said.
Article 12 of the Constitution defines what is a State.
The employee, Partha Sarathi Sen Roy, had joined BLIL in May 1975 as a management trainee and his services were terminated on February 27, 1981.
He had challenged the termination order by filing writ petition in the Calcutta high court.
BLIL had contested the petition saying it was not amenable to writ jurisdiction of the high court as it does not come under the definition of State.
The apex court decided Roy's case on merits, observing that the dispute has to come to "quietus" and said that it does not approve of the company's "hire-and-fire policy".
"Undoubtedly, the high court has not dealt with the issue on merits with respect to the termination of the services of the respondent herein. However, considering the fact that such termination took place several decades ago, and litigation in respect of the same remained pending not only before the high court, but also before this Court, it is desirable that the dispute comes to quietus."
"Therefore, we have dealt with the case on merits. In keeping with this, we cannot approve the hire and fire policy adopted by the appellant company...," the court said.
The bench held the company to be a 'state' noting that it is under an obligation to submit its monthly, as well as its half-yearly performance reports to the Petroleum ministry.
"The appellant company and IBP Company Limited, had a common chairman. The remuneration structure of the employees of the appellant company, is also in conformity with those which are applicable to the Indian Oil Corporation and IBP, as has been fixed by the Bureau of Public Enterprises, Government of India..," the bench said.