Full Judgment Text
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CASE NO.:
Appeal (civil) 1902-1903 of 2000
PETITIONER:
M/s Bharat Coking Coal Ltd.
RESPONDENT:
Rashtriya Colliery Mazdoor Sangh
DATE OF JUDGMENT: 16/01/2006
BENCH:
ARIJIT PASAYAT & TARUN CHATTERJEE
JUDGMENT:
J U D G M E N T
ARIJIT PASAYAT, J.
Appellant calls in question the legality of the judgment rendered by
a Division Bench of the Patna High Court upholding the judgment of the
learned Single Judge. By the said judgments certain persons were held
to be workmen of the appellant.
Factual background in a nutshell is as follows:
The Central Government in exercise of power under Section 10 of
the Industrial Disputes Act, 1947 (in short the ’Act’) referred the
following two disputes for adjudication to the Central Government
Industrial Tribunal No.1, Dhanbad (hereinafter referred to as the
’Tribunal’):
Reference No.32 of 1989 dated 16th March, 1989:
1. "Whether the action of the management of
Sudamdih Colliery of M/s in denying employment to
Shri Karma Rout and 21 others with effect from
9.7.1977 is justified? If not, to what relief the
concerned workmen are entitled" and
Reference No.35 of 1989 dated 20th March, 1989:
2. "Whether the action of the management of
Sudamdih Area of M/s BCCL in denying employment
to Shri Bhagwat Singh and 3 others, viz. Shri Sapan,
Karan Sahi and Shanti Thakur, who were engaged as
sump cleaning mazdoors is justified? If not, to what
relief are the workmen entitled"?
As the controversy involved in both the cases was the same, the
Tribunal heard them analogously and answered the references in favour
of the workmen declaring them to be workmen of the principal employer,
namely, the Management of M/s. Bharat Coking Coal Ltd. (hereinafter
referred to as the ’management’) and directing for their reinstatement in
service with effect from the dates of references with 75% back wages.
Being aggrieved by the said combined Award, the management filed two
writ petitions before the Patna High Court, being CWJC No.859/1993 (R)
and CWJC No. 856/1993 (R), which were dismissed by the learned Single
Judge on 10th August, 1998. Not being satisfied with the judgment of
the learned single Judge, the management has filed two appeals under
clause 10 of the Letters Patent.
Relying on a decision of this Court in Air India Statutory
Corporation etc. v. United Labour Union and others (AIR 1997 SC 645)
the Division Bench held that the decision of the learned Single Judge
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was unexceptionable. Reference was also made to a decision of this
Court in Secretary, Haryana State Electricity Board v. Suresh & Ors. etc.
(JT 1999 (2) SCC 435) to hold that where the engagement of workmen by
a contractor is a camouflage to conceal the real relationship between
principal employer and the workmen, then also the workmen employed
through unlicensed contractor are liable to be treated as workmen of the
principal employer.
Mr. Ajit Kumar Sinha, learned counsel for the appellant submitted
that the view expressed by the learned Single Judge and the Division
Bench cannot be sustained in view of the Constitution Bench judgment
of this Court in Steel Authority of India Ltd. and Ors. v. National Union
Waterfront Workers and Ors. (2001 (7) SCC 1). It was pointed out that
though dispute purportedly relating to the period 1976-77 was raised
long after i.e. about a decade and on that score alone the claimants were
not entitled to any relief. There was a settlement arrived at which was
binding. But the Tribunal and the High Court did not take note of the
same. Additionally, in the reference names of the workmen were not
given and it was not clear as to whose cause was being espoused by the
union. For the first time in the statement filed before the Tribunal by the
Union, the names were indicated. The reference was, therefore,
incompetent, but the Tribunal had lightly brushed it aside.
Mr. S.B. Upadhyay, learned counsel for the respondent on the
other hand submitted that the decision in Steel Authority’s case (supra)
applies to the present case as the so-called contractor was introduced as
a camouflage. This aspect has been noticed by the Tribunal.
Additionally, the respondents were not inactive and they were making all
the efforts to get the matter settled. Merely because the names were not
given, that did not render the reference incompetent. Further, the
settlement referred to had no legal sanction.
In order to appreciate the rival submissions observations of this
Court in various cases need to be noted.
In Steel Authority’s case (supra) it was observed, inter alia, as
follows (at para 125):
"125 - The upshot of the above discussion is outlined
thus:
(1)(a) Before 28-1-1986, the determination of the
question whether the Central Government or the State
Government is the appropriate Government in relation
to an establishment, will depend, in view of the
definition of the expression "appropriate Government"
as stood in the CLRA Act, on the answer to a further
question, is the industry under consideration carried
on by or under the authority of the Central
Government or does it pertain to any specified
controlled industry, or the establishment of any
railway, cantonment board, major port, mine or oilfield
or the establishment of banking or insurance company
? If the answer is in the affirmative, the Central
Government will be the appropriate Government;
otherwise in relation to any other establishment the
Government of the State in which the establishment
was situated, would be the appropriate Government;
(b) After the said date in view of the new definition of
that expression, the answer to the question referred to
above, has to be found in clause (a) of Section 2 of the
Industrial Disputes Act; if (i) the Central Government
company/undertaking concerned or any undertaking
concerned is included therein eo nominee, or (ii) any
industry is carried on (a) by or under the authority of
the Central Government, or (b) by a railway company;
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or (c) by a specified controlled industry, then the
Central Government will be the appropriate
Government; otherwise in relation to any other
establishment, the Government of the State in which
that other establishment is situated, will be the
appropriate Government.
(2)(a) A notification under Section 10(1) of the CLRA
Act prohibiting employment of contract labour in any
process, operation or other work in any establishment
has to be issued by the appropriate Government:
(1) after consulting with the Central Advisory Board or
the State Advisory Board, as the case may be, and
(2) having regard to
(i) conditions of work and benefits provided for the
contract labour in the establishment in question, and
(ii) other relevant factors including those mentioned in
sub-section (2) of Section 10;
(b) Inasmuch as the impugned notification issued by
the Central Government on 9-12-1976 does not satisfy
the aforesaid requirements of Section 10, it is quashed
but we do so prospectively i.e. from the date of this
judgment and subject to the clarification that on the
basis of this judgment no order passed or no action
taken giving effect to the said notification on or before
the date of this judgment, shall be called in question
in any tribunal or court including a High Court if it
has otherwise attained finality and/or it has been
implemented.
(3) Neither Section 10 of the CLRA Act nor any other
provision in the Act, whether expressly or by necessary
implication, provides for automatic absorption of
contract labour on issuing a notification by the
appropriate Government under sub-section (1) of
Section 10, prohibiting employment of contract labour,
in any process, operation or other work in any
establishment. Consequently the principal employer
cannot be required to order absorption of the contract
labour working in the establishment concerned.
(4) We overrule the judgment of this Court in Air India
case (Air India Statutory Corpn. v. United Labour
Union, (1997) 9 SCC 377 prospectively and declare
that any direction issued by any industrial
adjudicator/any court including the High Court, for
absorption of contract labour following the judgment
in Air India case (Air India Statutory Corpn. v. United
Labour Union, (1997) 9 SCC 377 shall hold good and
that the same shall not be set aside, altered or
modified on the basis of this judgment in cases where
such a direction has been given effect to and it has
become final.
(5) On issuance of prohibition notification under
Section 10(1) of the CLRA Act prohibiting employment
of contract labour or otherwise, in an industrial
dispute brought before it by any contract labour in
regard to conditions of service, the industrial
adjudicator will have to consider the question whether
the contractor has been interposed either on the
ground of having undertaken to produce any given
result for the establishment or for supply of contract
labour for work of the establishment under a genuine
contract or is a mere ruse/camouflage to evade
compliance with various beneficial legislations so as to
deprive the workers of the benefit thereunder. If the
contract is found to be not genuine but a mere
camouflage, the so-called contract labour will have to
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be treated as employees of the principal employer who
shall be directed to regularise the services of the
contract labour in the establishment concerned
subject to the conditions as may be specified by it for
that purpose in the light of para 6 hereunder.
(6) If the contract is found to be genuine and
prohibition notification under Section 10(1) of the
CLRA Act in respect of the establishment concerned
has been issued by the appropriate Government,
prohibiting employment of contract labour in any
process, operation or other work of any establishment
and where in such process, operation or other work of
the establishment the principal employer intends to
employ regular workmen, he shall give preference to
the erstwhile contract labour, if otherwise found
suitable and, if necessary, by relaxing the condition as
to maximum age appropriately, taking into
consideration the age of the workers at the time of
their initial employment by the contractor and also
relaxing the condition as to academic qualifications
other than technical qualifications."
In a later case in Nitinkumar Nathalal Joshi and Ors. v. Oil and
Natural Gas Corporation Ltd. and Ors. (2002 (3) SCC 433), it was noted
in paragraph 8 as follows:
"8-In the present case, the appellants were not
absorbed by the principal employer. Therefore, it
cannot be said that the decision in Steel Authority of
India Ltd. case ((2001) 7 SCC 1) cannot be applied. The
directions issued by the learned Single Judge were
modified by the Division Bench of the High Court and
never given effect to. Therefore, the directions issued
by this Court in Steel Authority of India Ltd. case
((2001) 7 SCC 1) are applicable on all fours."
So far as delay in seeking the reference is concerned, no formula of
universal application can be laid down. It would depend on facts of each
individual case.
However, certain observations made by this Court need to be
noted. In Nedungadi Bank Ltd. v. K.P. Madhavankutty and Ors. (2000 (2)
SCC 455) it was noted at paragraph 6 as follows:
"6. Law does not prescribe any time-limit for the
appropriate Government to exercise its powers under
Section 10 of the Act. It is not that this power can be
exercised at any point of time and to revive matters
which had since heel) settled. Power is to be exercised
reasonably and in a rational manner. There appears to
us to be no rational basis on which the Central
Government has exercised powers in this case after a
lapse of about seven years of the order dismissing the
respondent from service. At the time reference was
made no industrial dispute existed or could be even
said to have been apprehended. A dispute which is
stale could not be the subject-matter of reference
under Section 10 of the Act. As to when a dispute can
be said to be stale would depend on the facts and
circumstances of each case. When the matter has
become final, it appears to us to be rather incongruous
that the reference be made under Section 10 of the Act
in the circumstances like the present one. In fact it
could be said that there was no dispute pending at the
time when the reference in question was made. The
only ground advanced by the respondent was that two
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other employees who were dismissed from service were
reinstated. Under what circumstances they were
dismissed and subsequently reinstated is nowhere
mentioned. Demand raised by the respondent for
raising an industrial dispute was ex-facie bad and
incompetent."
In S.M. Nilajkar and Ors. v. Telecom District Manager, Karnataka
(2003 (4) SCC 27) the position was reiterated as follows: (at para 17)
"17. It was submitted on behalf of the respondent
that on account of delay in raising the dispute by the
appellants the High Court was justified in denying
relief to the appellants. We cannot agree. It is true, as
held in M/s. Shalimar Works Ltd. v. Their Workmen
(supra) (AIR 1959 SC 1217), that merely because the
Industrial Disputes Act does not provide for a
limitation for raising the dispute it does not mean that
the dispute can be raised at any time and without
regard to the delay and reasons therefor. There is no
limitation prescribed for reference of disputes to an
industrial tribunal, even so it is only reasonable that
the disputes should be referred as soon as possible
after they have arisen and after conciliation
proceedings have failed particularly so when disputes
relate to discharge of workmen wholesale. A delay of 4
years in raising the dispute after even reemployment of
the most of the old workmen was held to be fatal in
M/s. Shalimar Works Limited v. Their Workmen
(supra) (AIR 1959 SC 1217), In Nedungadi Bank Ltd. v.
K.P. Madhavankutty and others (supra) AIR 2000 SC
839, a delay of 7 years was held to be fatal and
disentitled to workmen to any relief. In Ratan Chandra
Sammanta and others v. Union of India and others
(supra) (1993 AIR SCW 2214, it was held that a casual
labourer retrenched by the employer deprives himself
of remedy available in law by delay itself, lapse of time
results in losing the remedy and the right as well. The
delay would certainly be fatal if it has resulted in
material evidence relevant to adjudication being lost
and rendered not available. However, we do not think
that the delay in the case at hand has been so
culpable as to disentitle the appellants for any relief.
Although the High Court has opined that there was a
delay of 7 to 9 years in raising the dispute before the
Tribunal but we find the High Court factually not
correct. The employment of the appellants was
terminated sometime in 1985-86 or 1986-87.
Pursuant to the judgment in Daily Rated Casual
Employees Under P&T Department v. Union of India
(supra) (AIR 1987 SC 2342), the department was
formulating a scheme to accommodate casual
labourers and the appellants were justified in awaiting
the outcome thereof. On 16-1-1990 they were refused
to be accommodated in the scheme. On 28-12-1990
they initiated the proceedings under the Industrial
Disputes Act followed by conciliation proceedings and
then the dispute was referred to the Industrial
Tribunal cum-Labour Court. We do not think that the
appellants deserve to be non suited on the ground of
delay."
It appears that the Tribunal and the High Court did not consider
the factual position in the background of the legal position as noted
above. Of course at the point of time when the matter was decided Air
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India’s case (supra) held the field. But, in view of the pronouncement of
the Constitution Bench in Steel Authority’s case (supra) the matter needs
to be re-examined by the High Court. Though it was submitted by Mr.
Upadhyay that there is a finding about the appellant having adopted a
camouflage, there is no definite finding by the Tribunal and/or the High
Court in this regard. Mere reference to certain observations of this Court
would not suffice without examination of the factual position.
Additionally, the effect of omitting the names of the claimants whose
cause was being espoused by the Union has not been considered by the
High Court in the proper perspective. Similar is the position regarding
purported settlement. In these peculiar circumstances, it would be
appropriate for the learned Single Judge of the High Court to re-consider
the matter. Accordingly, the matter is remitted to the High Court so that
learned Single Judge can consider the matter afresh taking into account
the principles set out above and consider their applicability to the
background facts on the issues raised by the appellant. As the matter is
pending since long, learned Chief Justice of the High Court is requested
to allot the matter to a learned Single Judge who shall make an effort to
dispose of the matter afresh within a period of six months from the date
the matter is allotted by the learned Chief Justice.
The appeals are allowed to the aforesaid extent without any order
as to costs.