Full Judgment Text
1
REPORTABLE
IN THE SUPREME COURT OF INDIA
INHERENT JURISDICTION
CONTEMPT PETITION (CIVIL) NO. 404/2019
IN
CIVIL APPEAL NO. 10511/2011
The Workmen through the Convener
FCI Labour Federation …Petitioner(s)
Versus
Ravuthar Dawood Naseem ...Respondent(s)
With
CONTEMPT PETITION (CIVIL) NO. 508/2019 IN CIVIL
APPEAL NO. 10511/2011
CONTEMPT PETITION (CIVIL) NO. 507/2019 IN CIVIL
APPEAL NO. 10499/2011
CONTEMPT PETITION (CIVIL) NO………../2020 IN CIVIL
APPEAL NO. 10499/2011
(@ Diary No. 13740/2019)
CONTEMPT PETITION (CIVIL) NO. 754/2019 IN CIVIL
APPEAL NO. 7961/2014
CONTEMPT PETITION (CIVIL) NO. 1073/2019 IN CIVIL
APPEAL NO. 10499/2011
Signature Not Verified
Digitally signed by
DEEPAK SINGH
Date: 2020.05.19
15:37:09 IST
Reason:
J U D G M E N T
2
A.M. Khanwilkar, J.
1. I.A. for permission to file the contempt petition(s) is allowed.
2. These contempt petitions except Contempt Petition (Civil)
No. 754/2019 emanate from the common judgment and order of
this Court dated 20.8.2018 in Civil Appeal Nos. 10499/2011 and
10511/2011. Contempt Petition (Civil) No. 754/2019, however,
arises from a separate judgment and order of this Court on the
same subject matter and date (i.e. 20.8.2018) in Civil Appeal No.
7961/2014.
3. The grievance in these petitions is about noncompliance of
1
direction given to the respondentFood Corporation of India to
regularise and departmentalise the concerned workers who had
initiated industrial disputes bearing I.D. No. 39/1992 and I.D.
2
No. 55/1993 before the Industrial Tribunal , Tamil Nadu,
Chennai under Section 10(1)(d) of the Industrial Disputes Act,
3
1947 . The concerned employees were employed at Depots of the
Corporation in the Southern Zone of India including the States of
Kerala, Andhra Pradesh, Karnataka and Tamil Nadu, as daily
1 For short, “the Corporation”
2 For short, “the Tribunal”
3 For short, “the 1947 Act”
3
rated labour or casual labour through contract labour
cooperative societies or private contractors. They were working
in that capacity for quite some time and in some cases, for
around 15 to 20 years, and were performing similar work as the
regular employees of the Corporation. In I.D. No. 39/1992,
following issue was referred to for adjudication:
“Whether the action of the management of Food
Corporation of India, in denying to regularise 955
contract labourers engaged by management of Food
Corporation of India Godown, Avadi through TVK
Cooperative Society in respect of names as given in the
Annexure is justified? If not to what relief they are
entitled to?”
(emphasis supplied)
In I.D. No. 55/1993, reference was made for adjudication of the
following issue:
“Whether the services of workmen employed in different
Food Storage depots in Food Corporation of India in the
South where notifications have been issued prohibiting
engagement of contract labourers under Section 10(1) of
CL (R and A) Act are entitled to be regularised and if so,
from which date?”
(emphasis supplied)
During the pendency of these References, an understanding was
arrived at between the parties, as recorded in the Minutes of
Meeting dated 12.4.1996, the relevant extract whereof is as
under:
4
“The Charter of demand submitted by the FCI Workers
Union vide their letter dated 12.2.96 was taken do for
discussions and decision taken on each of their demands
are recorded as under:
1. Department allegation of workers and payment of
documental wages to the workers in all FCI depots as
recommended upto [ sic ] the Hon’ble Supreme Court of
India, and especially in South Sons where the Central
Government have notified prohibiting employment of
contract labour long before considering the food handling
work as perennial in nature (both the foodhandling work
is still being done in all South Depots) by Labour
Cooperative Society as Contractors as well as the Hon’ble
High Courts of Kerala and Karnataka have also directed
for departmentisation of FCI workers in F.S. Depots.
The Union demanded departmentalization of labour in all
the notified depots on the plea that there are other
notified depots where departmentalisation has already
been done since 1991. As such, these depots may also be
extended the benefit of departmentalisation. After having
protracted discussions, keeping in view the orders of the
Hon’ble Karnataka High Court and the Supreme Court
and the scheme submitted for decision between the
Karnataka High Court, following decisions were taken:
(i) It was decided that in all remaining, notified
FCIs own Depots which were running under
the Labour Cooperative Societies, or
otherwise may be brought under Direct [ sic ]
Payment System with all the benefits under
st
the Direct Payment Scheme w.e.f. 1 May,
1996.
(ii)
It was also decided that proposal for
departmentalization will be sent to the
st
government by 31 July, 1996 and till
decision from the Government or from the
concerned courts Direct payment System will
continue .
(iii) It was agreed that in the other notified depots of
FCI where labour Cooperative Societies are not
functioning, the labour strength will be assessed
on the basis of the formula to be evolved in
consultation with FCI Workers Union as the
Union had mentioned that the formula of
assessment of labour being adopted by diving
the workload i.e. receipt and issue by 365 is not
5
realistic. The Union suggested that the
workload of receipt and issue as well as all
operations performed in the depot should be
taken into account and the same should be
divided by 240 days instead of 365. As regards
labour Cooperative Societies, it was decided that
the workers already working there during last 3
years and who had worked for nine out of 12
months in the last year and whose PF
deductions are being made will be extended
benefit of Direct Payment System workers.
However the actual requirement of labour for
these depots will be assessed as per the norms
agreed to with the Union and utilisation of
surplus labour including employment elsewhere
will be resorted to by the management in
consultation with the Union. Regarding norms,
the Union expressed resentment about adopting
365 days a year which management agreed to
look into and take a final view.
(iv) As regards notified depots under CWC, separate
discussions will be held for a final decision.
(Action Manager (IRL)
2. Immediate departmentalisation of all the workers
of FCI Depots under Direct Payment System,
Guaranteed Wages System, No work no pay System
and BCategory system. It was agreed that the
system as in existence will continue [ ]. ”
sic
(emphasis supplied)
A list of Depots having Departmental Labour System in March,
2000 is annexed as annexure P3 in the reply affidavit filed by
the petitioner to the counter affidavit of the respondent in
Contempt Petition (Civil) No. 404/2019.
6
4. In I.D. No. 39/1992, after due consideration of the rival
submissions, the Tribunal vide award dated 19.12.1997, noted
the point for its consideration as follows:
“7. The point for our consideration is: whether the
action of the management of FCI (respondent) in denying
to regularise 955 contract labourers engaged by the
management of FCI godown at Avadi through Thiru VI.
Ka. Labour Contract Cooperative Society is justified.”
After detailed analysis and reference to other decisions between
the workmen and the Corporation, the Tribunal came to issue the
following direction:
“14. In the result award is passed holding that action of
the respondent management in denying to regularise the
955 contract labourers engaged through Thiru. VI. Ka.
Cooperative Society as not justified and the management
is directed to regularise and departmentalise these 955
workmen from the date of notification Ex. W 4 with regard
to Avadi depot i.e. 28.02.1990 with all attendant benefits.
No Costs.”
(emphasis supplied)
5. Similarly, the Tribunal while disposing of I.D. No. 55/1993
vide award dated 29.7.1998, issued following directions:
“… Therefore, the services of workmen employed in
different food storage depots of the Food Corporation of
India in South India where notification have been issued
prohibiting engagement of contract labour u/s 10(1) of
the Contract Labour (Regulation and Abolition) Act, are
entitled to be regularised , from the date of notification
concerning each depot. Award passed. No costs”.
(emphasis supplied)
7
The aforementioned awards were subject matter of challenge
4
before the High Court of Judicature at Madras in Writ Petition
Nos. 11416/1999 and 12416/1999. The learned single Judge
vide judgment and order dated 14.8.2003, dismissed the writ
petitions on the finding that the awards passed by the Tribunal
were just and proper, and thus affirmed the same.
6. Feeling aggrieved, the Corporation carried the matter before
the Division Bench of the Madras High Court by way of Writ
Appeal Nos. 3382/2003 and 3383/2003. The Division Bench
dismissed the said writ appeals vide judgment and order dated
13.12.2006 having agreed with the conclusion arrived at by the
Tribunal in passing awards and the reasoning of the learned
single Judge in confirming the same. The Corporation filed
special leave petitions before this Court, which were converted
into Civil Appeal Nos. 10499/2011 and 10511/2011. Both
appeals have been dismissed by a common judgment and order
dated 20.8.2018 upholding the view taken by the Tribunal and
the Madras High Court.
7. Contempt Petition (Civil) No. 754/2019 is in reference to a
separate judgment and order of the same date (i.e. 20.8.2018)
4 For short, “the Madras High Court”
8
passed by this Court in Civil Appeal No. 7961/2014 in respect of
writ petition instituted by the contempt petitioners (Thrissur Jilla
General Mazdoor Sangh and others) before the High Court of
5
Kerala at Ernakulam being Writ Petition No. 14786/2013,
praying for the following reliefs:
th
“(i) A writ of mandamus directing the 5 respondent to
take effective steps for implementing Exhibit P1;
(ii) Declare that the DPS workers in the depot of FCI at
Mulakunnathukavu, Thrissur, are entitled to be
regularised and are entitled to the pay and other service
benefits of departmental labourer…”
The stated writ petition was dismissed by the learned single
Judge vide judgment and order dated 4.9.2013 on the finding
that there was substantial compliance of directions issued by the
Tribunal. It also noted that there was no indication in the award
that the workers were required to be engaged in the godowns in
Kerala, departmentally. Feeling aggrieved, the contempt
petitioners filed Writ Appeal No. 1746/2013 before the Kerala
High Court, which came to be allowed in terms of the directions
issued in O.P. No. 14360/1999 as affirmed in Writ Appeal No.
2491/2009. The relied upon order in O.P. No. 14360/1999 was
passed by the Kerala High Court in a petition filed by Head Load
5 For short, “the Kerala High Court”
9
Labour Congress for implementation of the award passed by the
Tribunal. The reliefs claimed in the said writ petition read thus:
nd
“a) a writ of mandamus directing the 2 respondent to
take effective steps for implementing Exhibit P1.
b) hold that all godowns and depots of FCI, especially in
Kerala, the workers should be regularised and brought
under direct payment system forthwith .”
(emphasis supplied)
The above writ petition came to be allowed vide judgment and
order dated 22.9.2009. Feeling aggrieved, the respondent
Corporation had filed Writ Appeal No. 2491/2009 before the
Kerala High Court, which was dismissed vide judgment and order
dated 15.2.2010. Against the said decision, the Corporation had
filed special leave petition before this Court, which was converted
into Civil Appeal No. 10530/2011 and came to be dismissed by a
common judgment and order dated 20.8.2018 of this Court
alongwith Civil Appeal No. 7961/2014, referred to above.
8. Despite the dismissal of the appeals and confirmation of the
award passed by the Tribunal including the writ issued by the
Kerala High Court to implement the award, the respondent
Corporation took no initiative, which prompted the contempt
petitioners to approach this Court for initiating contempt action
against the respondent Corporation and its officers.
10
9. The respondent Corporation would contend that it has
already regularised the eligible employees, who were party to the
two References mentioned above, under Direct Payment System
(DPS) and nothing further was required to be done. It is urged
that in both the References, the claim was restricted to
regularisation of the concerned employees after abolition of the
contract labour system. There was no prayer for absorbing the
concerned employees under any specific system of regular labour
prevailing in the Corporation. The Corporation has four systems
of labour engagement, namely, (i) Departmental Labour System,
(ii) Direct Payment System, (iii) NoWorkNoPay System and (iv)
Mate System. The workmen or the Unions concerned took no
steps to amend the Reference even after the agreement arrived at
in the meeting dated 12.4.1996 to ask for specific relief of
regularisation under a particular system. In absence of any
specific relief, the respondent regularised the workers under
Direct Payment System (DPS) during pendency of the References.
The existence of Direct Payment System (DPS) since 1973 is
indisputable. It has been noted in the decision of this Court in
Workmen of the Food Corporation of India vs. M/s. Food
11
6
Corporation of India and recently in ESI Corporation vs. FCI
7
. It is also urged that since 1991, no
Workers Union & Ors.
contract worker has been regularised under the Departmental
Labour System, although some Direct Payment System (DPS)
workers and ‘B category’ workers were brought under
Departmental Labour System in 1994 and 1997 pursuant to
specific awards/Court orders followed by settlements during
pendency of appeals filed by the Corporation. The recent policy
guidelines issued by the Government of India vide letter dated
11.11.2013 unambiguously predicate that the contract workers
be regularised only under NoWorkNoPay System. It is the case
of the Corporation that out of 1800 Depots operated by the
Corporation, more than 1500 Depots were operating under
contract labour system, and provided employment to more than
one lakh labour, out of which 50% of the total regular labour is
employed under the Direct Payment System (DPS). It has
produced the Chart in regard to regular labour as on 31.12.2019
under three different categories as under:
| Labour Type | Number of<br>Depots | Men in<br>Position |
|---|
6 (1985) 2 SCC 136
7 Civil Appeal Nos. 8841-8842/2019 decided on 19.11.2019
12
| Departmental Labour<br>System (DLS) | 56 | 10860 |
|---|---|---|
| Direct Payment System<br>(DPS) | 155 | 19427 |
| No Work No Pay (NWNP) | 85 | 6427 |
| Total | 295 | 36714 |
(emphasis supplied)
It is not as if only the workmen involved in two References have
been regularised in Direct Payment System (DPS). There are
19427 workmen in this system as against 10860 under
Departmental Labour System. It is urged that the service benefits
under the Direct Payment System (DPS) are indicative of the fact
that it is a regular engagement by the Corporation and not on
contract or casual basis. The service benefits under the Direct
Payment System (DPS) are outlined as follows:
“ Service Benefits under DPS :
The main service benefits of the DPS workers are
highlighted as under:
i. DPS workers are governed by the Model standing
Orders under Industrial Employment Standing Orders
Act, 1946.
ii. DPS workers are permanent and regular and thus,
departmentalised employees of FCI and enjoys security of
tenure as superannuation age of a DPS worker is 60
years.
iii. The Legal Heirs of a DPS worker are eligible for
Compassionate Appointment on death as per Govt. of
India policy circulated vide FCI Hqrs. Circular no. 4/2003
dated 04/13.03.2003.
iv. The workers are paid monthly wages directly by the
corporation subject to assured minimum guaranteed
13
wages declared by Central Govt. Thus, a DPS worker gets
higher monthly wages on piece rate basis when volume of
work handled by him is high but when there is no work
or adequate work at the depot during a particular month,
the DPS workers is assured of minimum guaranteed
wages.
v. DPS worker is eligible for paid weekly off, 06
holidays including 03 national holidays, 10 sick leave per
year (accumulation upto 40 days), 15 days “leave without
pay” per annum, CPF under FCI CPF scheme, Exgratie in
lieu of Bonus as per the provision of payment of Bonus
Act.
vi. DPS worker is eligible for productivity linked
incentive as declared by FCI Hqrs. from time to time.
vii. DPS worker is eligible for OTA admissible as per
shops and establishment act or 1.1 of hourly earnings
where exemption from shops and establishment act has
been granted by the appropriate authority or said act
does not apply.
viii. DPS worker is eligible for festival advance as per
FCI instructions applicable from time to time.
ix. DPS worker is eligible for gratuity as per payment
of gratuity act, 1972 from the date of notification.
x. DPS worker is eligible for workmen’s compensation
as per workmen’s compensation as per workmen’s
compensation act.
xi. DPS worker is eligible for Benevolent Fund as per
the scheme of FCI.
xii. DPS worker is eligible for transfer grant/packing
allowance and joining period on their transfer within and
outside region/zone as per the instructions of the
corporation issued from time to time.”
Further, the Corporation has now been advised to declare the
Departmental Labour System as a dying cadre. The same has
been so notified by the Government of India recently on 3.1.2020
in light of recommendation made by the HighLevel Committee
constituted by the Government of India in August, 2014.
14
Additionally, it was necessitated because of the directions given
by the High Court of Judicature at Bombay, Bench at Nagpur in
a suo moto registered PIL No. 84/2014 vide judgment and order
dated 20.11.2015, which has been confirmed by this Court vide
judgment and order dated 31.7.2017 passed in SLP(C) No.
19218/2016 and connected matters. The respondent has placed
reliance on
State of Bihar & Ors. vs. Bihar Secondary
8
Teachers Struggle Committee, Munger & Ors. , wherein it has
been held that when administration adopts an integrated policy
and if by process of judicial intervention, any directions are
issued, it could create tremendous imbalance and cause great
strain on budgetary resources. As a matter of fact, the
Constitution Bench of this Court in Steel Authority of India
9
Ltd. & Ors. vs. National Union Waterfront Workers & Ors.
has held that the contract labour need not be absorbed after
abolition of contract labour system. Be that as it may, the
Corporation is not a profitmaking organisation. It has been
established under the provisions of the Food Corporations Act,
1964 and its primary duty is to undertake purchase, storage,
8 (2019) 8 SCALE 124
9 (2001) 7 SCC 1 (Constitution Bench)
15
movement, transport, distribution and sale of food grains and
other food stuff. It is an agency to implement food policy of the
Government of India, which envisages protection of farmers by
ensuring remunerative price (Minimum Support Price) for their
produce and simultaneously safeguarding the interests of poor
consumers by providing them food grains at highly subsidised
rates under National Food Security Act, 2013 and other welfare
schemes. The food subsidy of more than Rs.1.50 lakh crore per
annum is extended. It is stated that if all the regular workers in
the Corporation are brought under the Departmental Labour
System, there will be recurring liability on public exchequer to
the tune of Rs.3,000 crore per annum and if arrears are also
given with effect from 2003, there will be additional financial
burden of more than Rs.40,000 crore. It is urged that the issue
regarding the parity of wages between the employees under the
Direct Payment System (DPS) and those working under the
Departmental Labour System is pending adjudication in I.D. No.
1/2003 before the National Industrial Tribunal, Mumbai.
Finally, it is urged that in absence of any clear directions in
Reference proceedings, as per the extant policy, the respondent
could have regularised the concerned workers only under the
16
Direct Payment System (DPS) existing since 1973 as part of its
organisational structure. It is, therefore, urged that it is certainly
not a case of disobedience, much less wilful or deliberate
disobedience of the order passed by this Court. Reliance is
placed on
Dinesh Kumar Gupta vs. United India Insurance
10
Company Limited & Ors. , Bihar State Government
Secondary School Teachers Association vs. Ashok Kumar
11 12
Sinha & Ors. and Dineshan K.K. vs. R.K. Singh & Anr. .
The respondents pray that the show cause notice(s) be
discharged.
10. The petitioners, however, submit that the direction given by
the Tribunal and upheld by the Madras High Court including by
this Court is unambiguous. It mandates the respondent
Corporation to regularise the concerned workers in the
Departmental Labour System, as has been done in other cases
adverted to by the Tribunal and the Madras High Court in the
respective award/judgment. The petitioners assert that the
Direct Payment System (DPS) was implemented on 1.5.1996,
whereas the dispute had been raised by the workers
10 (2010) 12 SCC 770 (paragraph 17)
11 (2014) 7 SCC 416 (paragraph 24)
12 (2014) 16 SCC 88 (paragraphs 14 and 15)
17
Union/workers in 1992 and 1993. The relief granted by the
Tribunal relates back to the date of initiation of Reference
proceedings and at that time, in all other cases, regularisation of
contract workers after abolition of contract labour system, was
done under the Departmental Labour system. The regularisation
of workers under the Direct Payment System (DPS) would be
denial of their claim for being regularised under the
Departmental Labour system. If such argument of the
respondent Corporation was to be acceded to and that too in
contempt proceedings, it would be rewriting the award of the
Tribunal which had become final until this Court. For, the
Tribunal in its award dated 19.12.1997 in I.D. No. 39/1992 had
clearly directed the respondent Corporation to regularise and
departmentalise the concerned workers with effect from the date
of notification of abolition of contract labour system. It is too late
in the day for the Corporation to contend to the contrary. It is
urged that there are material differences between the service
conditions under the Departmental Labour System and the
Direct Payment System (DPS). The petitioners have relied on the
decision of this Court in Food Corporation of India & Ors. vs.
18
13
West Bengal Food Corporation of India Workmen’s Union
14
and the order passed in contempt petition in that matter, to
urge that the Corporation was directed to regularise the
concerned workers under the Departmental Labour system.
According to the petitioners, the Corporation is under obligation
to extend same relief to these petitioners and implement the
direction given by the Tribunal and upheld by the High Court, as
well as, this Court, to regularise and departmentalise the
concerned workers under the Departmental Labour system only.
Reliance is placed on
Anil Ratan Sarkar & Ors. vs. Hirak
15
Ghosh & Ors. to contend that the Corporation cannot be
permitted to raise a new plea, so as to frustrate the decision of
the Tribunal and more particularly, of this Court, even after
dismissal of the appeal preferred by the respondent.
11. We have heard Mr. Rana Mukherjee, learned senior counsel
for the petitioners in Contempt Petition (Civil) Nos. 508/2019 and
507/2019, Mr. V. Prakash, learned senior counsel for the
petitioners in Contempt Petition (Civil) No……………./2020 (@
Diary No. 13740/2019), Mr. Colin Gonsalves, learned senior
13 (2018) 9 SCC 469
14 Contempt Petition (Civil) No. 809/2018
15 (2002) 4 SCC 21 (paragraphs 20 to 22)
19
counsel for the petitioners in Contempt Petition (Civil) No.
754/2019, Mr. Brijender Chahar, learned senior counsel for the
petitioners in Contempt Petition (Civil) Nos. 404/2019 and
1073/2019, Mr. Mukul Rohatgi, learned senior counsel for the
respondents in Contempt Petition (Civil) No. 754/2019, Mr. V.
Giri, learned senior counsel for the respondents in Contempt
Petition (Civil) No. 404/2019 and Mr. Sudarsh Menon, learned
counsel for the applicant in I.A. No. 167580/2019 in Contempt
Petition (Civil) No. 404/2019.
12. Before we proceed to analyse the stand taken by the parties,
it is apposite to advert to the exposition of this Court in
Ram
16
Kishan vs. Tarun Bajaj & Ors. , wherein the Court has
delineated the contours for initiating civil contempt action. In
paragraphs 11, 12 and 15 of the reported decision, the Court
observed thus:
“ 11. The contempt jurisdiction conferred on to the law
courts power to punish an offender for his wilful
disobedience/contumacious conduct or obstruction to the
majesty of law, for the reason that respect and authority
commanded by the courts of law are the greatest
guarantee to an ordinary citizen that his rights shall be
protected and the entire democratic fabric of the society
will crumble down if the respect of the judiciary is
undermined. Undoubtedly, the contempt jurisdiction
is a powerful weapon in the hands of the courts of law
16 (2014) 16 SCC 204
20
but that by itself operates as a string of caution and
unless, thus, otherwise satisfied beyond reasonable
doubt, it would neither be fair nor reasonable for the
law courts to exercise jurisdiction under the Act. The
proceedings are quasicriminal in nature, and
therefore, standard of proof required in these
proceedings is beyond all reasonable doubt. It would
rather be hazardous to impose sentence for contempt
on the authorities in exercise of the contempt
jurisdiction on mere probabilities . (Vide V.G.
Nigam v. Kedar Nath Gupta , (1992) 4 SCC 697, Chhotu
Ram v. Urvashi Gulati , (2001) 7 SCC 530, Anil Ratan
Sarkar v. Hirak Ghosh , (2002) 4 SCC 21, Bank of
Baroda v. Sadruddin Hasan Daya , (2004) 1 SCC
360, Sahdeo v. State of U.P. , (2010) 3 SCC 705
and National Fertilizers Ltd. v. Tuncay Alankus , (2013) 9
SCC 600.
12. Thus, in order to punish a contemnor, it has to
be established that disobedience of the order is
“wilful”. The word “wilful” introduces a mental
element and hence, requires looking into the mind of
a person/contemnor by gauging his actions, which is
an indication of one's state of mind. “Wilful” means
knowingly intentional, conscious, calculated and
deliberate with full knowledge of consequences
flowing therefrom . It excludes casual, accidental, bona
fide or unintentional acts or genuine inability. Wilful acts
does not encompass involuntarily or negligent actions.
The act has to be done with a “bad purpose or without
justifiable excuse or stubbornly, obstinately or
perversely”. Wilful act is to be distinguished from an act
done carelessly, thoughtlessly, heedlessly or
inadvertently. It does not include any act done negligently
or involuntarily. The deliberate conduct of a person
means that he knows what he is doing and intends to do
the same. Therefore, there has to be a calculated
action with evil motive on his part. Even if there is a
disobedience of an order, but such disobedience is the
result of some compelling circumstances under which
it was not possible for the contemnor to comply with
the order, the contemnor cannot be punished.
“Committal or sequestration will not be ordered
unless contempt involves a degree of default or
misconduct .” (Vide S. Sundaram Pillai v. V.R.
Pattabiraman , (1985) 1 SCC 591, Rakapalli Raja Ram
21
Gopala Rao v. Naragani Govinda Sehararao , (1989) 4 SCC
255, Niaz Mohammad v. State of Haryana , (1994) 6 SCC
332, Chordia Automobiles v. S. Moosa , (2000) 3 SCC 282,
Ashok Paper Kamgar Union v. Dharam Godha , (2003) 11
SCC 1, State of Orissa v. Mohd. Illiyas , (2006) 1 SCC 275
and Uniworth Textiles Ltd. v. CCE , (2013) 9 SCC 753.
xxx xxx xxx
15. It is wellsettled principle of law that if two
interpretations are possible, and if the action is not
contumacious, a contempt proceeding would not be
. The effect and purport of the order is to be
maintainable
taken into consideration and the same must be read in its
entirety. Therefore, the element of willingness is an
indispensable requirement to bring home the charge
within the meaning of the Act. [See Sushila Raje
Holkar v. Anil Kak , (2008) 14 SCC 392 and Three Cheers
Entertainment (P) Ltd. v. CESC Ltd. , (2008) 16 SCC 592.”
(emphasis supplied)
Suffice it to observe that to constitute civil contempt, it must be
established that disobedience of the order is wilful, deliberate and
with full knowledge of consequences flowing therefrom. For
reaching that conclusion, it is essential to notice the scope of
References before the Tribunal and direction issued therein,
which has been affirmed upto this Court. Going by the plain
text, the issue(s) referred to for adjudication (reproduced in
paragraph 3 above) is merely for regularisation. However, the
pointinissue considered by the Tribunal coupled with the
operative part of the award (which has been reproduced in the
earlier part of this judgment), it would at best be a case of
directing the respondent Corporation to regularise and
22
departmentalise the concerned workmen, who were party to the
stated References.
13. As noted earlier, the Corporation operates four systems of
labour. The Departmental Labour System is one such system of
engagement. The other is Direct Payment System (DPS). The
third is NoWorkNoPay System and fourth, the Mate System.
Neither the relief in the References was specific for regularisation
in Departmental Labour System only nor the Tribunal, the
Madras High Court/Kerala High Court or this Court was called
upon to deal with that issue specifically. The claim set up by the
petitionerUnion(s) was simpliciter for regularisation of workmen
who were named in the annexure(s) to the References. The
Tribunal did issue direction to regularise and departmentalise
those workmen. It is axiomatic that departmentalisation could
also be an engagement in a Department, which could be a
separate part or branch/section of the whole Organisation.
Departmentalisation is dividing an organisation into different
departments or structuring it in a manner, which perform tasks
according to the specialisations in the organisation. It may
include departments such as functional, product, process,
23
geographical locations, customer, divisional, matrix, planning
task force etc.
14. As it is indisputable that the Corporation has four systems
of labour engagement including the Direct Payment System
(DPS), the petitionerUnion(s) ought to have sought specific relief
against the Corporation in that regard. Significantly, the
petitioners have assumed that the Direct Payment System (DPS)
commenced only from 1.5.1996, whereas it is noticed from the
decision of this Court in
Workmen of the Food Corporation of
India (supra) that the Direct Payment System (DPS) is in
existence from 1973. It is not a new set up created by the
Corporation pursuant to the minutes recorded on 12.4.1996 as
such. Concededly, the subject References, as well as, the
direction issued by the Tribunal, which has been upheld upto
this Court is silent about the system in which the concerned
workers have to be regularised and departmentalised. It is
incomprehensible as to how it would be a case of disobedience,
much less wilful disobedience, so as to entail in contemptuous
conduct of the concerned officers of the Corporation especially
when the eligible enlisted workers have already been regularised
24
under the Direct Payment System (DPS) as per the applicable
policy of 1991. Notably, the writ petition filed before the Kerala
High Court for implementation of the stated award also sought
direction (reproduced in paragraph 7 above) to regularise the
concerned workmen under the Direct Payment System (DPS). If
that be the position, it is unfathomable as to how the respondent
Corporation can be proceeded against for having committed
contempt of this Court.
15. The argument of the petitioners, however, is that the
awards passed by the Tribunal, as well as, the judgments of the
Madras High Court/Kerala High Court and this Court may have
to be read as a whole and if so read, it would only mean that the
direction given to the respondent Corporation was to regularise
and departmentalise all the concerned workmen on the same
terms as done in other cases referred to in the concerned
judgment. To buttress this submission, reliance is placed on the
award of the Tribunal, dated 19.12.1997, wherein reference is
made to cases of regularisation in 1991 and as back as in 1982.
In the relied upon cases, the Tribunal did not advert to the policy
of the respondent Corporation to engage the concerned
employees after abolition of the contract labour system only
25
under the Direct Payment System (DPS) and which was being
strictly adhered to since 1991. Pertinently, there was specific
direction by the Tribunal/Court in those cases to regularise the
concerned workmen under the Departmental Labour System,
which is not so in the present case.
16. Indeed, the award dated 19.12.1997 makes extensive
reference to the previous judgment of the Kerala High Court. In
that decision, while issuing direction to the Corporation, it was
made clear that the absorption of the concerned workmen would
be governed exclusively by the terms and conditions prescribed
by the Corporation for its own regular employees and the
Corporation shall have all the rights such as retrenchment. It
was further directed that the process of absorption must be in
accordance with the provisions of concerned labour and
industrial law. Be that as it may, in the present case, neither
any discussion is noticed about the efficacy of policy of the
Corporation effective since 1991 regarding regularising the
concerned workmen after abolition of contract labour system only
under the Direct Payment System (DPS) nor a clear direction has
been given by the Tribunal to the respondent Corporation to
regularise the concerned workmen only under the Departmental
26
Labour System. Similarly, the learned single Judge has merely
upheld the direction as given by the Tribunal. Indeed, the
impression gathered from the discussion in the judgment of the
learned single Judge does indicate that the Corporation being an
instrumentality of the State cannot be heard to discriminate
between its different employees working at different Depots. As
noted earlier, it is not as if the workmen involved in subject
References alone were being considered for regularisation in the
Direct Payment System (DPS). There are 19427 others who have
been so appointed and working as on 31.12.2019. Moreover,
those who were working as contract labour engaged through
cooperative societies or private contractors came to be
regularised in the Direct Payment System (DPS) as per the policy
of 1991. The fact remains that even the learned single Judge had
not issued specific direction to the respondent Corporation to
regularise the concerned workmen under the Departmental
Labour System and not under the Direct Payment System (DPS)
as such. Similarly, the Division Bench proceeded to consider the
matter as to whether the direction issued by the Tribunal is
acceptable and whether the learned single Judge was right in
27
affirming the said direction. In examining that question, the
Division Bench, amongst others, noted as follows:
“21. As rightly pointed out by the learned Judge, except
the godowns/depots in Tamil Nadu, the Labourers
engaged in similar capacity in other parts of the country
have been departmentalised or regularised. As a matter
of fact, even in this State, in respect of Egmore and port
godowns of FCI, the workers have been departmentalised.
We already mentioned that Notifications of the
Government of India regularising/departmentalising the
workers' issue in respect of other States, were placed
before the Tribunal. As rightly pointed out by the learned
Judge, inasmuch as FCI is a Corporation having
transactions throughout India, when it thought fit to
regularise the workers in some parts of India, particularly
in North, they are not justified in denying such benefits to
the workmen in the State. Inasmuch as the main
argument on the side of the appellant was projected for
remanding the case to the Tribunal as if the materials
placed before it were not considered, in the light of the
evidence let in before the Tribunal in the form of various
orders/Notifications by the Government of India,
existence of more work in all the godowns, Food Storage
Depots of FCI and of the fact that all those acceptable
materials were correctly appreciated by the Tribunal, we
are of the view that there is no case for remand. As
rightly pointed out by the learned Judge as well as
correctly observed by the Tribunal, the FCI, which is a
wing of Government of India, should be a model
employer, more particularly, when they are having
plenty of continuous work and are in need of more
work Force, we are satisfied that both the Unions are
justified in their demand for regularisation and for
departmentalisation.
22. Under these circumstances, we are in entire
agreement with the conclusion arrived at by the
Industrial Tribunal in passing award and the
reasoning of the learned single Judge in confirming
the same. Consequently, both the Writ Appeals fail
. …”
and are, accordingly, dismissed. No costs
(emphasis supplied)
28
It is thus seen that even the Division Bench did not issue any
specific direction to the respondent Corporation to regularise the
concerned workmen under the Departmental Labour system and
not to do so under the Direct Payment System (DPS) as per the
policy of 1991. This Court has merely affirmed the view taken by
the Tribunal and the Madras High Court. More importantly, the
Departmental Labour System has since been notified as a dying
cadre.
17. To put it differently, the issue as to regularisation of the
concerned workmen under particular labour system had not
been put in issue before the Tribunal and upto this Court. A
general direction came to be issued to regularise and
departmentalise them. Resultantly, the respondents were left
with the only option to regularise the concerned workmen as per
the extant applicable policy of the Organisation, under the Direct
Payment System (DPS).
18. Reverting to the decision of the Kerala High Court in Writ
Petition No. 14360/1999 filed for directing implementation of the
award in question, the relief claimed was to regularise the
concerned workmen under the “Direct Payment System (DPS)”
29
forthwith. That relief was already acceded to by the Corporation
in the minutes recorded between the parties dated 12.4.1996.
For that reason, the Corporation did not participate in the
Reference proceedings in I.D. No. 39/1992 and allowed the I.D.
No. 55/1993 to proceed exparte . Indeed, the Corporation
assailed the awards upto this Court on the basic issue of right
and entitlement of the concerned workmen to be regularised.
The fact whether regularisation should be under the
Departmental Labour System or the Direct Payment System
(DPS) was not put in issue at any stage including the appeal
decided by this Court. The Corporation having lost on the basic
issue of regularisation was obliged to give effect to the award as
per its extant policy in that regard in force since 1991.
19. Notably, the relief granted by the Division Bench of the
Kerala High Court in Writ Appeal No. 2491/2010 was only for
regularisation in the Direct Payment System (DPS) as prayed in
the writ petition. In the subsequent writ petition filed before the
Kerala High Court being Writ Petition No. 14786/2013, against
which the appeal came to this Court being Civil Appeal No.
7961/2014, the relief claimed was for regularisation and to give
30
all other service benefits of Departmental Labour system. This
writ petition was dismissed by the learned single Judge on the
finding that the award in question was already substantially
complied with. When the matter went up to the Division Bench
by way of writ appeal being Writ Appeal No. 1746/2013, the
same was disposed of as per the direction issued in the earlier
writ petition being O.P. No. 14360/1999 and Writ Appeal No.
2491/2009 referred to above. The relief granted in these
proceedings was, therefore, only regarding regularisation in the
Direct Payment System (DPS). If that be so, we fail to understand
as to how the writ petitioner(s) therein could ask for relief
different than regularisation under the Direct Payment System
(DPS).
20. Reliance was placed by the petitioners on the dictum in
paragraph 23 of the judgment dated 20.8.2018 in Civil Appeal
Nos. 10499/2011 and 10511/2011, which reads thus:
“23. It was then brought to our notice that similar
industrial reference alike the one in the present case was
also made in relation to the FCI Branch at West Bengal
and the said reference was answered in favour of workers’
Union. The matter was then taken to the High Court
unsuccessfully and then carried to this Court at the
instance of the FCI in Civil Appeal No. 7452 of 2008 and
the appeal was dismissed on 20.07.2017 resulting in
upholding the award of the Industrial Tribunal. It was
31
stated that the FCI then implemented the award, as is
clear from the notice on 05.10.2017, in favour of the
concerned workers. Be that as it may, since we have
upheld the impugned order in this case on the facts
arising in the case at hand, we need not place reliance
on any other matter, which was not before the High
.”
Court
(emphasis supplied)
21. The petitioners have adverted only to the opening part of
this paragraph. The crucial part, in our opinion is, the latter
(highlighted) part, wherein the Court has made it clear that the
judgment relied upon was not being taken into account for
deciding the appeal.
22. In West Bengal Food Corporation of India Workmen’s
Union (supra) involving a case arising from the proceedings and
order dated 8.3.2001 passed by the High Court of Calcutta in
C.R. No. 5498 (W) of 1991, which is extracted in the order passed
by this Court, dated 20.7.2017, the Court opined that order in
the said case had directed the respondents to frame a scheme or
to find ways and means to absorb the concerned workmen. That
direction can have no bearing on determination of the matters at
hand, being contempt petitions. For the same reason, the
subsequent orders passed in contempt petition in the said appeal
will have no bearing on the present case. For, these petitions will
32
have to be decided strictly on the basis of the awards passed in
the References in question and the judgment of the Madras High
Court/Kerala High Court and this Court, being contempt action.
23. In the present case, as noticed earlier, no specific direction
has been given to the Corporation to regularise the concerned
workmen only in the Departmental Labour System.
Furthermore, the Departmental Labour System is now a dying
cadre and the policy of the Corporation at the relevant time
entailed regularisation of such workmen only under the Direct
Payment System (DPS). Thus understood, no contempt action
can be initiated on the basis of general direction to the
respondents to regularise and departmentalise the concerned
workmen. For, it is not possible to hold that intrinsic in the
general direction was to ordain the respondents to regularise and
departmentalise the concerned workmen under the Departmental
Labour System in the teeth of the extant policy of the Corporation
in force since 1991 regarding regularisation against Direct
Payment System (DPS).
24. Reverting to the decision of this Court in
Anil Ratan
Sarkar (supra), it was a case in which crystalclear direction was
33
given to the management to treat the concerned employees at par
with another set of specified employees. Further, despite six
rounds of litigation, the management kept on taking defence of
its bona fide understanding of the situation, which came to be
deprecated. Had it been a case of clear direction by the Tribunal,
the High Court or this Court, and an attempt was made to
interpret, or so to say, misinterpret, such direction, to regularise
the employees concerned under the Departmental Labour
System, and if such direction was not to be complied with by the
respondent Corporation, the situation could have been viewed
differently being a contempt action. In the present case, it is
not a moonshine defence as was the finding recorded in the
reported decision.
25. Suffice it to observe that no case for initiating contempt
action against the respondent Corporation and its officers has
been made out. We need not, therefore, analyse any other aspect
of the matter, which would require rewriting of the judgments on
the basis of which this contempt action has been instituted.
That cannot be countenanced in contempt proceedings.
34
26. Accordingly, these petitions fail and are dismissed. Show
cause notices stand discharged. Pending interlocutory
applications, if any, shall stand disposed of.
..................................J.
(A.M. Khanwilkar)
..................................J.
(Dinesh Maheshwari)
New Delhi;
May 19, 2020.