1955 (3) TMI 37 - SC - Indian Laws

Supreme Court rules in favor of appellant, affirms employee status, upholds reinstatement and back pay.

Shivnandan Sharma Versus The Punjab National Bank Ltd

Shivnandan Sharma Versus The Punjab National Bank Ltd - 1955 AIR 404, 1955 SCR (1) 1427 Issues Involved:1. Wrongful dismissal of the appellant.2. Jurisdiction of the Tribunal to entertain the dispute.3. Employment relationship between the appellant and the Bank vs. Treasurers.4. Interpretation of the agreement between the Bank and the Treasurers.Detailed Analysis:1. Wrongful Dismissal of the Appellant:The appellant, who was employed as the head cashier at the Una Branch of the Bank, was dismissed following the closure of the branch. The Tribunal initially found the dismissal wrongful, stating, 'I am of the opinion that the dismissal of Shri Sharma was wrongful and liable to be set aside.' The Tribunal ordered reinstatement with back salary, stating, 'He will also be paid his back salary an allowance from the date of dismissal to the date of reinstatement.'2. Jurisdiction of the Tribunal to Entertain the Dispute:The Appellate Tribunal questioned the jurisdiction of the Tribunal, noting that it had not determined whether the appellant was an employee of the Bank or the Treasurers. The Appellate Tribunal stated, 'The Tribunal had recorded no finding on that basic question and had assumed that the respondent before it was an employee of the Bank.' The Supreme Court, however, held that the Tribunal had jurisdiction, stating, 'That being so, the Tribunal had the jurisdiction to make the directions it did in respect of the appellant.'3. Employment Relationship Between the Appellant and the Bank vs. Treasurers:The core issue was whether the appellant was an employee of the Bank or the Treasurers. The Tribunal initially assumed the appellant was an employee of the Bank. The Appellate Tribunal, however, concluded that the appellant was an employee of the Treasurers based on the agreement. The Supreme Court, after examining the agreement, concluded, 'It must therefore be held that the Treasurers are the servants of the Bank and that their nominees must equally be so.' The Supreme Court thus determined that the appellant was an employee of the Bank, not the Treasurers.4. Interpretation of the Agreement Between the Bank and the Treasurers:The agreement dated 1st May 1944 between the Bank and the Treasurers was central to determining the employment relationship. The Appellate Tribunal interpreted the agreement to mean that the Treasurers were independent contractors and the appellant was their employee. However, the Supreme Court, after a detailed examination of the agreement, found that the Treasurers were under the control and direction of the Bank, and thus, the appellant was an employee of the Bank. The Court stated, 'The Treasurers are under the complete control and direction of the Bank through its manager or other functionaries.'Conclusion:The Supreme Court allowed the appeal, holding that the appellant was an employee of the Bank and that the Tribunal had jurisdiction to entertain the dispute. The orders of the Tribunal reinstating the appellant with back salary were upheld. The appeal was allowed with costs throughout.