Once a Court Declares a Department an Industry Under Section 2(j), State Cannot Raise the Same Objection Again: Gujarat High Court Slams Repetitive Litigation by Irrigation Department

“Reiterating a Legal Issue Already Settled by Supreme Court and Full Bench is Judicial Misconduct; Such Conduct May Attract Costs” – Gujarat High Court firmly rejecting the State’s challenge to a Labour Court’s award that had granted reinstatement with continuity of service (but without back wages) to a daily wager working in the Irrigation Department. The High Court confirmed the Labour Court’s findings, reinforcing that the Irrigation Department is an "industry" within the meaning of Section 2(j) of the Industrial Disputes Act, 1947, and once this has been conclusively settled by constitutional courts, the State is precluded from repeatedly raising this plea.

The judgment not only upholds the reinstatement of the daily wager but also makes critical observations on the misuse of litigation by State departments and underscores the obligation of public authorities to respect judicial discipline.

Labour Court Rightly Drew Adverse Inference for Non-production of Muster Rolls: Employer Failed to Discharge Burden of Proof

The case revolved around a daily wager in the Irrigation Department who had worked from 1985 to 2011. After his services were terminated, he initiated industrial adjudication under the Industrial Disputes Act, seeking reinstatement. The Labour Court, Godhra, in Reference (T) No. 150 of 2013, granted him reinstatement with continuity of service but denied back wages. Both the State and the employee challenged the award—while the employee sought full relief including back wages, the State sought to nullify the award entirely.

Justice Hemant M. Prachchhak, presiding over the writ petitions, noted that the Labour Court had rightly concluded that the workman had completed more than 240 days of service in a year, fulfilling the threshold under Section 25B of the ID Act. The Court emphasized that “the burden of proving non-continuity of service lies on the employer once the workman enters the witness box and asserts his continuous service.”

In this case, the employer failed to produce the muster rolls, despite specific directions from the Labour Court. The Court relied on the precedent of R.M. Yellatti v. Assistant Executive Engineer [(2006) SCC (L&S) 1], stating that non-production of the “best evidence” mandates drawing of adverse inference against the employer.

“It is well-settled that once the employee enters the witness box and deposes continuous service, and the employer fails to produce the muster rolls despite being directed, adverse inference has to be drawn,” the Court observed.

“A Settled Question of Law Cannot Be Repeatedly Re-agitated”: High Court Warns State Against Vexatious Litigation

A central issue raised by the State was that the Irrigation Department did not qualify as an “industry” under Section 2(j) of the Industrial Disputes Act. The Court responded with strong words, reminding the State that this issue had long been settled by binding precedent from the Supreme Court in Des Raj v. State of Punjab [(1988) 2 SCC 537], and by a Full Bench of the Gujarat High Court in Gujarat Forest Producers, Gatherers and Forest Workers Union v. State of Gujarat [2004 (2) GLH 302].

The Court minced no words in censuring the State for raising the same plea again:

“Once a Full Bench and the Supreme Court have conclusively held that the Irrigation Department is an ‘industry’ under Section 2(j), it is unacceptable for the State to continue raising the same objection. This Court may be constrained to impose costs in future if such vexatious litigation continues.”

The Court reiterated that “judicial discipline demands that coordinate benches follow precedent, and public authorities must respect the rule of law and not prolong litigation by repeating settled contentions.”

Reinstatement with Continuity of Service Granted on Parity with Similarly Situated Workmen

Relying on multiple judgments involving similarly placed daily wagers in the same department—including Special Civil Application No. 2205 of 2023 (affirmed in LPA No. 855 of 2025) and SCA Nos. 4168 and 4189 of 2022—the Court ruled that parity must be maintained.

“When employees from the same department have been granted reinstatement with continuity of service, the petitioner herein, being identically situated, cannot be treated differently,” the Court held.

Notably, the Division Bench of the High Court in LPA No. 389 of 2024 had already confirmed such orders of reinstatement. Following the established line of precedents, the Court directed the State to reinstate the employee within three months, with continuity of service, though without any back wages.

State’s Petition Dismissed; Employee’s Petition Allowed

The High Court dismissed the State’s petition and allowed the employee’s petition to the extent that continuity of service was expressly directed. While the claim for back wages was not granted, the Court’s emphasis on uniformity of relief and adherence to binding precedent offers significant clarity for future litigation.

The judgment serves as a stern reminder that:

“The State, though entitled to raise legitimate legal arguments, cannot persist in raising matters that have already been conclusively determined by the highest Courts. Such conduct wastes judicial time and is an abuse of process.”

The Labour Court’s award was modified to ensure reinstatement with continuity of service, and the writ of the Court is to be complied with within three months.

This decision by the Gujarat High Court affirms not only the rights of daily wage workers under the Industrial Disputes Act but also reinforces judicial discipline and the importance of following precedent. The Court’s warning to the State—against re-agitating settled issues—carries serious implications for all government departments engaged in prolonged and unnecessary litigation.

The ruling protects the principle that justice must not only be done but must be done equally to similarly situated individuals. By ensuring parity and condemning state overreach, the Court has upheld both the rule of law and the dignity of labor.

Date of Decision: 04/12/2025