The Kerala High Court has ruled that the term “employment” in Section 17B of the Industrial Disputes Act, 1947 encompasses situations where a workman engages in self‑employment that generates adequate income. The bench led by Justice S. Manu delivered this finding while considering an interim application in a writ petition.
The case emerged after the petitioner, who had been terminated by Shwas Homes Private Limited in 2011, was awarded reinstatement by the Labour Court in March 2022. The award included continuity of service and entitlement to 50 percent back wages with interest. The company failed to implement this award, prompting the petitioner to initiate execution proceedings. Subsequently, she filed an application under Section 17B seeking ₹4.14 lakh in wages, asserting that she remained unemployed and destitute since termination.
In opposition, the employer provided documentary materials showing that the petitioner was actively involved in two self‑run ventures: a designer boutique named “Marlin’s Wardrobe” and an enterprise called “Saga, the Craft People.” These were presented as profit‑generating businesses. The petitioner contested that these ventures did not yield sufficient income to disqualify her from relief under Section 17B. She argued that the provision only applied where a workman was employed in a formal establishment—not in a self‑employment scenario—and that her self‑employment did not qualify as adequate earnings.
The High Court, however, rejected this interpretation. Referring to Supreme Court authority in North–East Karnataka Road Transport Corporation v. M. Nagangouda, the court held that “gainful employment” indeed includes self‑employment so long as it generates sufficient income. Drawing from that precedent, the bench stated that Section 17B’s scope cannot be constrained to formal establishment employment only. It emphasized that legislative intent behind Section 17B contemplates relief limited to those without any sufficient source of livelihood, thereby including self‑employment within its ambit provided income is adequate.
Justice Manu observed that the petitioner failed to disclose her business engagements in her supporting affidavit, intentionally withholding information regarding the boutique and craft enterprise. The Court noted that she claimed lack of any income under oath, yet admitted only after being confronted with evidence, which the Court found unacceptable. It remarked that selective disclosure undermined the credibility of her plea, especially in the context of a claim based on alleged destitution.
On these bases, the Kerala High Court concluded that the interim application under Section 17B lacked merit. It held that the petitioner’s profitable self‑employment disqualified her from receiving wages under the provision, which is designed to cushion against hardship during pendency of proceedings only for those genuinely unemployed or without adequate income. The interim relief was therefore denied, and the main writ petition was listed for further hearing.
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