DATE: 25/09/25
COURT: High Court of Punjab
BENCH: Justice Harpreet Singh Brar
FACTS:
The petitioner was appointed as a Tubewell
Operator with the Municipal Council, Khanna on 14.09.1992, and his services
were regularised on 29.12.1994 after completing 240 days of work. However, his
employment was abruptly terminated on 29.03.1994 without any show-cause notice
or inquiry. The Industrial Tribunal, Ludhiana, through its award dated
28.07.2011, directed his reinstatement with continuity of service and full back
wages. Despite this, the Municipal Council reinstated him only after he
submitted an affidavit dated 02.11.2011 agreeing not to claim arrears. He was
reappointed afresh, thereby losing credit for his previous service. When he
requested that his service from 1992 to 2012 be counted toward regularisation
and pension, his claim was rejected by the authorities vide order dated
03.03.2025.
The petitioner contended that his
termination was illegal and that the Council’s insistence on a waiver of
arrears and denial of past service benefits was arbitrary and contrary to the
Tribunal’s award. He argued that such coercive conditions violated Articles 14
and 16 of the Constitution. The respondents, however, maintained that the
petitioner was bound by his undertaking and cited High Court of Punjab &
Haryana v. Jagdev Singh (2016) to assert that employees are bound by
undertakings given voluntarily.
ISSUES:
The key issue before the Court was whether
an employee can be denied substantial service rights and pensionary benefits
based on an undertaking given under the dictates or pressure of the employer,
particularly when such undertaking was extracted as a condition for
reinstatement following an unlawful termination.
JUDGEMENT WITH REASONING:
The Punjab and Haryana High Court allowed
the writ petition, quashing the impugned order dated 03.03.2025. It held that
the undertaking obtained from the petitioner was void ab initio as it was
secured through undue influence and economic coercion. The Court directed the
respondents to count the petitioner’s past service for all purposes, including
pensionary benefits, in line with Harbans Lal v. State of Punjab and State of
Haryana v. Jai Bhagwan. The authorities were ordered to issue a compliance order
within three months.
The Court observed that the petitioner’s
termination was manifestly illegal since it was done without notice or inquiry,
violating principles of natural justice. It found that although the Industrial
Tribunal had granted reinstatement with continuity of service and full back
wages, the Municipal Council coerced the petitioner into signing an affidavit
relinquishing his lawful entitlements. This conduct, the Court noted, amounted
to undue influence within the meaning of Sections 16, 19A, and 23 of the Indian
Contract Act, 1872. Any contract obtained through coercion or against public
policy, the Court emphasized, is void. The petitioner, having been out of
employment for 11 years and financially distressed, had no real choice but to
accept the Council’s conditions to secure his livelihood. Hence, the
undertaking could not be treated as voluntary or legally binding.
Furthermore, the Court condemned the
respondent’s behaviour as arbitrary, exploitative, and contrary to
constitutional guarantees under Articles 14 and 21. It reiterated that public
employers must act as model employers, adhering to fairness and reasonableness
in their decisions. Citing landmark judgments such as Maneka Gandhi v. Union of
India, Ajay Hasia v. Khalid Mujib Sehravardi, and Rojer Mathew v. South Indian
Bank Ltd., the Court underscored that arbitrariness is antithetical to equality
and the rule of law. The practice of compelling employees to waive their
statutory or pensionary rights in exchange for reinstatement was denounced as
exploitative and unconstitutional. Consequently, the Court held that no
employee can be forced to contract out of his legal or statutory entitlements,
and such undertakings are null from inception.
ANALYSIS:
This case highlights the judiciary’s firm
stance against exploitative employment practices, particularly those adopted by
public authorities. The Punjab and Haryana High Court’s decision reinforces
that undertakings or affidavits obtained from employees under economic duress
or as a condition for reinstatement after unlawful termination lack legal
validity. By invoking the provisions of the Indian Contract Act, 1872, the
Court rightly identified the petitioner’s affidavit as a product of undue
influence and coercion, rendering it void ab initio. The judgment also
underscores the constitutional obligation of State authorities to act as model
employers, adhering to the principles of fairness, equality, and reasonableness
embedded in Articles 14, 16, and 21 of the Constitution. The Court viewed the
respondent’s conduct as a deliberate circumvention of the Industrial Tribunal’s
award and a blatant disregard for the petitioner’s right to livelihood, thereby
amounting to arbitrary and unconstitutional action.
Additionally, the Court’s reasoning
reflects a broader constitutional and moral philosophy that public employment
must not be reduced to a means of exploitation. By referencing key precedents
such as Maneka Gandhi v. Union of India and Ajay Hasia v. Khalid Mujib
Sehravardi, the Court emphasized that arbitrariness in State action strikes at
the core of equality before law and due process. The decision also serves as a
deterrent to the widespread administrative practice of compelling reinstated
employees to forgo their statutory rights as a precondition for re-employment.
It sends a strong message that any form of coercive waiver of service benefits
or pensionary entitlements cannot withstand judicial scrutiny. In essence, the
judgment upholds the principles of social justice and the rule of law,
reaffirming that fairness and equity must guide every employment relationship,
especially when the employer is a State instrumentality.
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