AI Structured Summary
Not yet generated for this judgment
Judgment
Lok Pal Singh, J
Present petitions arise out of the judgments and awards dated 29.08.2001 and 30.08.2001 passed by the Presiding Officer, Labour Court, Dehradun whereby the petitioner was directed to absorb the workmen-respondents A.K. Goswami and Rishipal as their employees from the date of award. Further, petitioner in WPMS No. 20 of 2010 is seeking writ of certiorari quashing the notification no. 4297-34021 Shra. As/36-shram 111 CB 16/99 Dehradun dated 14.06.2001.
Since, common question of law and facts are involved in both the writ petitions, therefore, they are being decided together by a common judgment.
For proper adjudication of the case, facts of WPMS No. 20 of 2010 are being taken into consideration.
Petitioner, a registered company (an undertaking of Union of India and an ancillary to the BHEL Ltd.) is engaged in the work of casting and forging.
Brief facts, of the case, are that Foundry Forge, Mazdoor Sangh-respondent no.6 through its Sabhapati raised an industrial dispute before the Regional Conciliation Officer at Saharanpur with the averments that the workmen Shri A.K. Goswami and Shri Rishi Pal, respondent nos. 7 and 8 were employed as contract labour through Shri Lakhpat Singh, contractor of CFFP/BHEL from 09.07.1986 with gate pass no. 75/05 and 76/05 to do radiography testing of casting manufactured in CFFP and under the condition of Babha Atomic Research Center, Trombay (Bombay) that source i.e. radiography isotope supply by B.A.R.C must be handled by certified radiographer who is only qualified persons by B.A.R.C. to do this skilled job. Undertaking to this effect was submitted by Certified Radiographer to BARC. It is further stated that CFFP is manufacturing sophisticated steel castings for Hydro, Thermal and Gas Turbines parts. These parts are examined ultrasonically magnetic particle testing and radiographically to satisfy customer for the soundness of these material as per requirement, as such, radiography testing is one of the quality control methods performed as one necessary operation in the manufacturing of these castings. CFFP invested crores of rupees for establishing these laboratories and on the training of the employees working therein. These concerned workmen have also underwent training by BARC which is mandatory under the Atomic Act to perform this job of radiography. Their work is controlled and supervised by the officer of CFFP, since the contractors does not know the anything about radiography work and even they are not qualified by BARC and in the absence of proper certification they are also not recognized by third party inspectors for radiography work. So total work of supervision is done by qualified persons of CFFP in radiography. It is further stated that if (a) the process, operation or other work is incidental to, or necessary for industry trade, business, manufacturing or occupation that is carried on in the establishment (b) the job is of perennial nature i.e. or sufficient duration (c) it is done ordinarily through regular workmen, the employment of contract labour in such process, operation or other work in any establishment is to be abolished under section 10(1) of the Contract Labour (Regulation & Abolition) Act, 1970. It is prayed that Conciliation Board be constituted for the settlement of the matter of the dispute to enable them to obtain the following relief:-
(A) That the fact that these workmen are performing the work of regular workmen since 1986 and the work is of statutory nature as per Atomic Act and controlled by BARC and their work is controlled and supervise by CFFP officers may kindly be adjudicated upon in the context that the contract between contractor and CFFP management is bad and not genuine and the work is a part of manufacturing process regular in nature and is being performed by regular workmen in BHEL.
(B) That the contract labour system in this process may be abolished.
(C) That the difference of pay from September 1986 and onwards be paid to them.
(D) That these workmen may kindly be absorbed at par with regular workmen doing similar same king of job in BHEL.
On receipt of aforesaid application from respondent no.6, the Regional Conciliation Officer referred the matter to the Government without hearing the matter on merits and Government through its order no. 4297-4302-MRRIR-1 (Sandarbh) Sankhya 16/99 dated 14.06.200 referred the matter to the Presiding Officer, Dehradun to decide the case as per the Provisions of U.P. Industrial Dispute Act, 1947. The Labour Court issued notices to the parties.
Petitioner filed its written statement stating therein that dispute espouse by the Union is untenable. Permission has been granted to the petitioner by the competent Government through Notification No. 2162 (H.I.)/36-2-127(SM)/90 dated 24th April 1990 to take work through the contract labour. It is contended that Lakhpat Singh is the contractor, who has been issued license no. 12/98 along with other contractors. It is further contended that work of radiography testing is done by the qualified regular worker of CFFP (BHEL) designated as Radiographer/ Laboratory Assistant. It is further contended that workmen A.K. Goswami and Rishi Pal are executing the work through contractor and they are not the employees of CFFP.
Lakhpat Singh, contractor also filed its written statement and stated that he is a licensed contractor under the Contract Labour (Regulation and Abolition) Act 1970 (hereinafter referred as Contract Labour Act) and has engaged A.K. Goswami and Rishi Pal as unskilled helpers in September 1998.
Parties have adduced their evidence before the Labour Court. Having heard learned counsel for the parties, labour court by impugned judgment and award dated 30.08.2001 has recorded its finding that the Central Assistant Labour Commissioner under section 7/2 of the Contract Labour Act has issued certificate of Registration to the employer to the five contractors including Lakhpat Singh, who has been engaged to supply the contract labourer for the work like transportation of the goods from one place to another, removal of sand, cleaning of equipments, opening and greasing of the equipments and to help in some other work. Central Assistant Labour Commissioner (for short CALC) has also given license in the favour of Lakhpat Singh, so he may take work for employer in the establishment from the contract labourer. The Labour Court also recorded the finding that as per the Notification dated 24.04.1990 issued by the State of U.P. except in the establishment of CFFP and in another establishment, the contract work through contract labour is prohibited which includes work of testing also, meaning thereby, work of testing can be done in the CFFP establishment through contract labour.
Labour Court has also recorded its finding that the work taken by the employer from the contractor is improper and the contract is camouflage as these two workers are working in the establishment. Contractor is mere agent of the employer. Learned Labour Court placed reliance upon the judgments of Bombay High Court in the case of Indian Airport Employees Union vs. International Airport Authority of India FLR 1996 (72) 582, and one passed by the Allahabad High Court in Bharat Heavy Electrical Ltd. Vs.State of Uttar Pradesh FLR 1999 (81) 990 and on the strength of the said judgments held that nature of work done by A.K. Goswami and Rishi Pal as a contract labour of contractor is unjustified and directed the employer/petitioner to consider the aforesaid two employees its own workmen and provide them salary and other benefits as being paid to the regular employees of the establishment.
Heard Mr. B.P. Nautiyal, Senior Advocate assisted by Mr. Mohd. Matloob, Advocate appearing for the petitioner and Mr. B.M. Pingal, Advocate appearing for the respondent nos. 7 and 8/ workmen.
Learned senior counsel appearing for the petitioner urged that permission was granted in the favour of petitioner establishment to take work from the contractor, and Labour Court has also recorded positive findings in favour of the petitioner establishment on one hand but on the other hand, Labour Court has recorded contrary findings that taking work through the contractor is sham and bogus. He would urge that though, the judgments mentioned above have been referred by the Labour Court in its award but there is no reference in regard to the ratio of those judgments. He would submit that none of the principle, laid down in the aforesaid judgments, is applicable to the facts and circumstances of the present case. It is further submitted that reference order dated 14.6.2000 is also illegal and without jurisdiction, as dispute qua the contract labour, engaged by the contractor cannot be referred to the Industrial Adjudicator without following the provisions of Rule 4 of the Industrial Disputes Rules.
Learned Senior Advocate would submit that when the application was made before the Conciliation Officer, the Conciliation Officer, without issuing notice and inviting objection from the petitioner, in an ex-parte manner, referred the matter to the State Government without complying the mandatory provisions of Rule 4 U.P. Industrial Dispute Rules 1957. Rule 4 of the Industrial Dispute Rules is extracted hereunder:-
Powers, procedure and duties of Conciliation Officers. - (1) On receipt of information about an existing or apprehended industrial dispute, the Conciliation Officer may, if he considers necessary, forthwith arrange to interview both the employers and the workmen concerned with the dispute at such place and time as he may deem fit and endeavour to bring about a settlement about the dispute in question.
(2) The Conciliation Officer may hold a meeting of the representatives of all the parties jointly or of each party separately.
(3) The Conciliation Officer shall conduct the proceedings expeditiously and in such manner as he may deem fit.
(4) Where a reference has been made by the State Government in the matter of a dispute under Section 4-K of the Act to the Tribunal or Labour Court or the Adjudicator, the Conciliation Officer concerned shall forthwith forward to the Tribunal or the Labour Court or the Adjudicator concerned, the file of the Conciliation Board relating to that matter, immediately after the application in Form I is filed by the Union.]
Learned Senior Advocate would further contend that Conciliation Officer has committed illegality in making reference to the State Government, without issuing notice to the petitioner and the order of reference is ab initio void. He would further submit that the Labour Court also committed patent illegality in granting the relief beyond the relief claimed in the application. Learned Senior Advocate has placed reliance upon the judgment of the Hon'ble Apex Court in the case of Steel Authority of India Ltd. Vs. National Union Water Front Workers (2001) 7 SCC 1 and emphasized upon the following paragraphs:-
"107. An analysis of the cases, discussed above, shows that they fall in three classes; (i) where contract labour is engaged in or in connection with the work of an establishment and employment of contract labour is prohibited either because the Industrial adjudicator/Court ordered abolition of contract labour or because the appropriate Government issued notification under Section 10(1) of the CLRA Act, no automatic absorption of the contract labour working in the establishment was ordered; (ii) where the contract was found to be sham and nominal rather a camouflage in which case the contract labour working in the establishment of the principal employer was held, in fact and in reality, the employees of the principal employer himself. Indeed, such cases do not relate to abolition of contract labour but present instances wherein the Court pierced the veil and declared the correct position as a fact at the stage after employment of contract labour stood prohibited; (iii) where in discharge of a statutory obligation of maintaining canteen in an establishment the principal employer availed the services of a contractor and the courts have held that the contract labour would indeed be the employees of the principal employer.
The next issue that remains to be dealt with is: B. Whether on a contractor engaging contract labour in connection with the work entrusted to him by a principal employer, the relationship of master and servant between him (the principal employer) and the contract labour emerges.
Mr. Shanti Bhushan alone has taken this extreme stand that by virtue of engagement of contract labour by the contractor in any work of or in connection with the work of an establishment, the relationship of master and servant is created between the principal employer and the contract labour. We are afraid, we are unable to accept this contention of the learned counsel. A careful survey of the cases relied upon by him shows that they do not support his proposition.
The decision of the Constitution Bench of this Court in Basti Sugar Mills case (supra) was given in the context of reference of an industrial dispute under the Uttar Pradesh Industrial Disputes Act, 1947. The appellant-Sugar Mills entrusted the work of removal of press mud to a contractor who engaged the respondents therein (contract labour) in connection with that work. The services of the respondents were terminated by the contractor and they claimed that they should be re-instated in the service of the appellant. The Constitution Bench held,
The words of the definition of workmen in Section 2(z) to mean any person (including an apprentice) employed in any industry to do any skilled or unskilled, manual, supervisory, technical or clerical work for hire or reward, whether the terms of employment be express or implied are by themselves sufficiently wide to bring in persons doing work in an industry whether the employment was by the management or by the contractor of the management. Unless however the definition of the word employer included the management of the industry even when the employment was by the contractor the workmen employed by the contractor could not get the benefit of the Act since a dispute between them and the management would not be an industrial dispute between employer and workmen. It was with a view to remove this difficulty in the way of workmen employed by contractors that the definition of employer has been extended by sub-clause (iv) of Section 2(i). The position thus is : (a) that the respondents are workmen within the meaning of Section 2(z), being persons employed in the industry to do manual work for reward, and (b) they were employed by a contractor with whom the appellant company had contracted in the course of conducting the industry for the execution by the said contractor of the work of removal of press-mud which is ordinarily a part of the industry. It follows therefore from Section 2(z) read with sub-clause (iv) of Section 2(i) of the Act that they are workmen of the appellant company and the appellant company is their employer.
It is evident that the decision in that case also turned on the wide language of statutory definitions of the terms workmen and employer. So it does not advance the case pleaded by the learned counsel.
In a three-Judge Bench decision of this Court in Hussainbhai case, the petitioner who was manufacturing ropes entrusted the work to the contractors who engaged their own workers. When, after some time, the workers were not engaged, they raised an industrial dispute that they were denied employment. On reference of that dispute by the State Government, they succeeded in obtaining an award against the petitioner who unsuccessfully challenged the same in the High Court and then in the Supreme Court. On examining various factors and applying the effective control test, this court held that though there was no direct relationship between the petitioner and the respondent yet on lifting the veil and looking at the conspectus of factors governing employment, the naked truth, though draped in different perfect paper arrangement, was that the real employer was the management not the immediate contractor. Speaking for the Court, Justice Krishna Iyer observed thus :-
Myriad devices, half-hidden in fold after fold of legal form depending on the degree of concealment needed, the type of industry, the local conditions and the like may be resorted to when labour legislation casts welfare obligations on the real employer, based on Articles 38, 39, 42, 43, and 43-A of the Constitution. The court must be astute to avoid the mischief and achieve the purpose of the law and not be misled by the maya of legal appearances.............
Of course, if there is total dissociation in fact between the disowning Management and the aggrieved workmen, the employment is, in substance and in real-life terms, by another. The Managements adventitious connections cannot ripen into real employment.
This case falls in class (ii) mentioned above.
Learned Senior Advocate also placed reliance upon the judgment of the Hon'ble Apex Court in the case of Bharat Heavy Electricals Ltd. Vs. Anil and others (2007) 1SCC 610.
Placing reliance upon the judgments supra, learned Senior Advocate would submit that permission was granted to the petitioner establishment to engage contractor labourer through contractor, therefore, judgment passed by the Labour Court is unsustainable in the eyes of the law.
On the other hand, Mr. Bipin Mohan Pingal, Advocate for the respondent nos. 7 and 8/ workmen would contend that respondent no. 6 was competent to make an application before the Conciliation Officer and on the said application, Conciliation Officer made reference to the State Government to decide the dispute. He would further contend that plea in regard to non issuance of notice to the petitioner and inviting objection against the application has not been taken by the petitioner before the Labour Court. He would further contend that the Hon'ble Apex Court in the case of Basti Sugar Mills Ltd. vs. Ram Ujagar AIR 1967 SC 355 has held that engagement through the contractor is not proper. The legislation is beneficial for the workmen, therefore, establishment cannot be permitted to take contract labour through contractor. As such, the practice of employing the contract labour through contractor is impermissible and taking work in the establishment through contractor is sham and farce. Learned counsel for the respondent, in support of his submission, also placed reliance upon the judgment passed by the Hon'ble Apex Court in the case of Hussainbhai Calicut vs. The Alath Factory Theshilali Union Kazhikode (1978) 4 SCC 257
The Hon'ble Apex Court in the case of Steel Authority of India Ltd. Vs. National Union Water Front Workers (2001) 7 SCC 1 has categorically described in the judgment that if the dispute espoused at the hands of the Union, same should be discarded, however, in the contingencies when the reference was made to the State Government in regard to the violation of Contract Labour Act, same can be entertained at the behest of the Union, on other condition. The Hon'ble Apex Court in paragraph no. 109 of the judgment declined to accept that submission of Mr. Shanti Bhushan, Senior Advocate appearing in the aforesaid case on behalf of the workmen/labour to consider the ratio of the judgment in the case of Basti Sugar Mills Ltd. vs. Ram Ujagar AIR 1967 SC 355 and Hussainbhai Calicut vs. The Alath Factory Theshilali Union Kazhikode (1978) 4 SCC 257. Paragraph no. 9 is reproduced hereunder:-
Mr. Shanti Bhushan alone has taken this extreme stand that by virtue of engagement of contract labour by the contractor in any work of or in connection with the work of an establishment, the relationship of master and servant is created between the principal employer and the contract labour. We are afraid, we are unable to accept this contention of the learned counsel. A careful survey of the cases relied upon by him shows that they do not support his proposition.
The Hon'ble Apex Court has clarified the fact that no relationship of master and servant exists between the contract labour and principal employer. No doubt, in Basti Sugar Mill vs. Ram Ujagar AIR 1967 SC 355 the Constitutional Bench has elaborately discussed and considered the issue of welfare of legislation but in the judgment of Steel Authority of India Ltd. Vs. National Union Water Front Workers (2001) 7 SCC 1 the Constitutional Bench has considered the issue again and impliedly overruled the ratio of the judgment of Basti Sugar Mills Ltd. vs. Ram Ujagar AIR 1967 SC 355, considering the fact that the judgment of Basti Sugar Mills Ltd.vs. Ram Ujagar AIR 1967 SC 355 came in the year 1964, before promulgation of the Contract Labour Act, 1970.
This Court is of the considered view that the Labour Court has exceeded its jurisdiction in passing the award in favour of the employees, namely, A.K. Goswami and Rishi Pal and directing the petitioner to pay equal remuneration being paid to the regular employees of the establishment along with other facilities and consider them as regular employees. Similar controversy was before the co-ordinate Bench of this Court whereby the order was passed by the Labour Court in the same fashion against which Bharat Heavy Electricals ltd. had approached before this Court challenging the award but the writ petition was dismissed on 24.04.2014 directing the BHEL to consider the contract labour as regular employees of the establishment. Bharat Heavy Electricals ltd. against the order dated 24.04.2014, preferred Civil Appeal No. 1799-1800 of 2019 (SLP) before the Hon'ble Apex Court. The Hon'ble Apex Court vide judgment and order 20.02.2019 allowed the appeal and set aside the judgment and order rendered by the co-ordinate Bench of this Court and has held that there is no relationship of employer and employee between them. However, at the most, those employees who are working in the establishment through contract, they may continue as contract employees.
In view of the ratio laid down by the Hon'ble Apex Court in the case of Bharat Heavy Electricals ltd Vs. Mahendra Prasad Jakhmola & ors. decided on 20.02.2019 the impugned judgments and awards are liable to be set aside.
For the foregoing reasons, impugned judgment and awards dated 29.08.2001 and 30.08.2001 passed by the Presiding Officer, Labour Court, Dehradun are hereby set aside. Consequently notification no. 4297-34021 Shra. As/36-shram 111 CB 16/99 Dehradun is hereby quashed. Both the writ petitions are allowed.
No order as to costs.