IPCA LABORATORIES LIMITED Vs. LAGHU UDYOG MAZDOOR UNION

JUDGEMENT

(1.) Leave Granted.

(2.) These appeals arise out of common judgment and order dtd. 18/12/2024 in WP No.5469 of 2016 and other connected matters as also RP No.12 of 2025 dtd. 16/5/2025 passed by the High Court of Madhya Pradesh at Indore. In essence, the dispute pertains to reinstatement of the respondent-employees and payment of back-wages by the appellant-employer.

(3.) The appellant-employer is a bulk drugs manufacturer located at Indore. The respondent-employees were 'for many years ' under their employment but were shown the door as of 1/4/2006, allegedly at the end of the contract on the basis of which they had been employed. Aggrieved by thus being shunted out, the respondent-employees took recourse to the law. Multiple rounds of litigation ensued first with the Labour Court, Indore in terms of C.No. 55/05 M.P.I.R. which came to be dismissed as per order dtd. 10/9/2009. An appeal thereagainst was filed before the Industrial Court, Indore in C.A.No.169 of 2009 and connected matters. The Industrial Court observed that the appellant-employer herein, upon having submitted that the respondent-employees were hired by it through a contractor, had to disclose the particulars in pleadings or in evidence, as to who the contractor was which they have not been able to do. That being the case, it was established that the appellant-employer had directly engaged the respondentemployees and the attempt to show them to be hired through a contractor was a 'camouflage and sham ', and termination of their services would amount to illegal retrenchment which is not permitted as per law. As such, reinstatement was ordered along with payment of 50% back wages. The High Court, on appeal, disagreed with the findings of the Industrial Court, and remanded the matter for fresh consideration observing that placing the onus of proof in establishing that the services of the respondent-employees were engaged through a contractor was erroneous in law.