Delhi Shops and Establishments Act,1954 — Physical PDF page 16 of 27

      (4) The amount payable as compensation under this section shall be in addition to any fine
payable under section 40.
      (5) No person who has been awarded compensation under this section shall be at liberty to
bring a civil suit in respect of the same claim.
                                              COMMENTS
(a) Applicability of section 30
      The protection of the provisions of the section is available to all persons who fall within the
definition of the term “employee” as given in section 2(7) of the Act and who have put in three
months’ continuous services. In the absence of any standing orders or any contract between the
employer and the contesting respondent containing any particular terms or conditions, the
conditions of service of the employee relating to his employment in an establishment at Delhi are
covered by section 30(1) of Delhi Shops and Establishments Act, 1954; Goodlass Nerolac Paints
(P) Ltd. v. Commissioner, Delhi, 1967 (14) FJR 115: 1967 I LLJ 545: 30 FJR 442.
      The payment of wages in lieu of notice is one of the modes by which the service of an
employee can be terminated, the other mode being the giving of at least one month’s notice in
writing. Under the mandatory provision of section 30 of the Delhi Shops and Establishments Act,
1954, the service of an employee who has put in more than three months’ continuous service
cannot be terminated without giving him at least one month’s notice in writing or one month’s
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wages in lieu of such notice except where the termination of service is for misconduct. Therefore,
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where an employee has worked for one day more than the three months stipulated in the section,
he will be entitled to one month’s notice or one month’s salary in lieu thereof; Ram Prakash
Sablok v. Mahesh Chander, 1973 (43) FJR 239 (Del HC).
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(b) Notice or wages in lieu thereof under section 30—When to be given?
      A plain reading of section 30 of the Act would make it clear that whereas the notice of one
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month under sub-section (1) is for the benefit of the employee, the notice under sub- section (2) is
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for the benefit of the employer. If an employer gives the notice under sub- section (1), it is open to
the employee to quit the service even before the expiry of the period of one month. Similarly,
where the notice is given under sub-section (2), it is open to the employer to dispense with the
services of the employee even before the expiry of the period of one month. It is not necessary
for the employer to wait for the full period of one month before dispensing with services, just as it
is not necessary for an employee who has received notice under sub-section (1) to wait for the
full period of one month before quitting the services of the employer.
      For example, when the employee served a notice of one month on the employer on 17-7-
1968 tendering his resignation to be effective from 16th August, 1968 and the employer accepted
the same on 23-7-1968 with immediate effect, then the employee cannot insist on continuing in
service till the expiry of the notice of one month on 16th August, 1968; Dass Studios v. R.K.
Baweja, Labour Court, Delhi, 1972 (1) ILR 856 (Del HC).
      One month’s notice or wages in lieu thereof is necessary in case the employees is having
more than three months’ service under section 30 of the Delhi Shops and Establishments Act.
This will be applicable even if an employee has completed only one day more than three months;
Ramprakash Sablok v. Mahesh Chandra, (1973) 43 FJR 239: 1973 1 LLN 339 (Del. HC) (A case
under section 39 of the Delhi Shops and Establishments Act decided by the Delhi High
Court).When the services of an employee are terminated by payment of one month’s wages in
lieu of notice, his services come to an end on the date on which he is terminated. On the other
hand, if he had been given one month’s notice and on the expiry of the one month his services
are terminated, his services would come to an end only after the notice period; May and Baker
(India) Ltd. v. Their Workmen, 1961 (2) FLR 594: (1961) 1LLJ 94 (SC): AIR 1967 SC 678: 20 FJR
147.
      It may also be pointed out that if the employer has preferred to dismiss or discharge an
employee on giving one month’s notice or one month’s wages in lieu of such notice, it matters
little whether the services are dispensed with for a minor misconduct or a major misconduct. If,
however, the employer does not give one month’s notice or one month’s wages in lieu thereof, it
is incumbent upon him to hold an enquiry and then to find the employee guilty of any of the acts
of misconduct as have been prescribed by the Government under Rule 13 of Delhi Shops and