Binding service practice and statutory leave ceilings shaped entitlement to privilege leave encashment and limited sick leave relief.

A settled and continuous practice of permitting encashment of privilege leave can ripen into a binding condition of service, and the workmen were entitled to that benefit when the management could not justify withdrawing it. By contrast, sick leave and casual leave could not be granted beyond the mandatory ceiling of twelve days in a year under the Delhi Shops and Establishments Act, 1954, because industrial adjudication cannot override a statutory limit on leave entitlement. The award was therefore sustained on privilege leave encashment but modified to conform to the statutory restriction on sick and casual leave.

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Issues: (i) Whether a long-standing practice of encashment of privilege leave had become an implied condition of service binding on the management. (ii) Whether the grant of sick leave and casual leave beyond the statutory ceiling could be ordered in favour of subordinate staff.

Issue (i): Whether a long-standing practice of encashment of privilege leave had become an implied condition of service binding on the management.

Analysis: The evidence established a continuous and uninterrupted practice of permitting encashment of privilege leave for specified purposes over a number of years. Such consistent conduct was sufficient to show that the concession had crystallised into a service condition. The management's later withdrawal of the facility, after the practice had continued for years, was not justified on the record.

Conclusion: The encashment of privilege leave had become a condition of service and the workmen were entitled to that benefit.

Issue (ii): Whether the grant of sick leave and casual leave beyond the statutory ceiling could be ordered in favour of subordinate staff.

Analysis: Section 22 of the Delhi Shops and Establishments Act, 1954 fixed a mandatory maximum of twelve days in a year for sickness or casual leave with wages. While the statute prescribed only a minimum for privilege leave, the ceiling for sick and casual leave was peremptory and could not be disregarded by industrial adjudication. A tribunal could not lawfully direct leave benefits in excess of that statutory limit merely because other employees received greater benefits under a different arrangement.

Conclusion: The direction granting sick leave and casual leave beyond twelve days in a year was invalid and stood set aside.

Final Conclusion: The award was sustained on privilege leave encashment and enhanced privilege leave, but modified to conform to the statutory limit on sick and casual leave.

Ratio Decidendi: A settled and continuous employment practice may ripen into a binding condition of service, but industrial adjudication cannot authorise leave benefits in excess of a mandatory statutory ceiling.

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