Full Judgment Text
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PETITIONER:
SHANKAR BALAJI WAJE
Vs.
RESPONDENT:
STATE OF MAHARASHTRA.
DATE OF JUDGMENT:
27/10/1961
BENCH:
DAYAL, RAGHUBAR
BENCH:
DAYAL, RAGHUBAR
KAPUR, J.L.
SUBBARAO, K.
CITATION:
1962 AIR 517 1962 SCR Supl. (1) 249
CITATOR INFO :
E 1963 SC1591 (1,5,13)
R 1966 SC 370 (10,11)
RF 1970 SC 66 (10)
E 1974 SC 37 (15)
RF 1974 SC1832 (62,65,68,88)
E 1987 SC 447 (9)
ACT:
Factory-Worker employed-Definition-No
contract of service between owner and labour-
Labourer free to attend and go any time-If worker-
Factories Act, 1948 (63 of 1948),ss. 2(1), 79,
79(11), 80,90, 92.
HEADNOTE:
The appellant was the owner of a factory
manufacturing bidis and one P along with other
labourers used to roll bidis in the factory with
tobacco and leaves supplied to him by the factory.
The following were established facts:-
(1) There was no contract of service
between the appellant and P.(2) He was not bound
to and the factory for rolling biding for any
fixed hours or period; he was free to go to the
factory at any time during working hours and leave
the factory at any time he liked. (3) He could be
absent from the work any day he liked and for ten
days without even informing the appellant. He had
to take the permission of the appellant if he was
to be absent for more than I O days. (4) He was
not bound to roll the bidies at the factory. He
could do so at home with the permission of the
appellant for taking home the tobacco supplied to
him. (5) There was no actual supervision of the
work done by him in the factory and at the close
of the day rolled bidis were delivered to the
appellant. Bidis not up to the standard were
rejected. (6) He was paid at fixed rates on the
quantity of bidis turned out and there was no
stipulating for turning out any minimum quantity
of bidis. The Inspector of Factories found that he
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was not paid the wages for 4 days’ leave which he
had earned after having worked for a certain
period. The appellant was fined Rs. 101- for
contravening the provisions of s. 79(11) of the
Factories Act. The questions which arose for
decision were whether P was a worker within the
meaning of that expression under the Act and
whether he was entitled to any leave wages under
s. 80 of the Act.
^
Held (per Kapur and Raghubar Dayal, JJ.),
that the decision of this Court in Birdhi Chand’s
Case was distinguishable on facts and could not be
applicable to the facts of the present case.
The appellant exercised no control and
supervision over P. He was not a worker as the
three criteria and conditions laid down by this
Court in Chintaman Rao’s
250
case for constituting him as such were not
fulfilled in the present case.
Biardhi Chand Sharma v. The First Civil
Judge, Nagpur [1961] 3 S. C. R. 161,
distinguished.
Chintaman Rao v. The State of Madhya Pradesh,
[1958] S.C. R. 1340, applied.
Whether the appellant contravened the
provisions of sub-.(1) of s. 79 depended on the
proper construction of ss. 79 and 80 of the Act.
With the terms of the work as they were in the
present case there could be no basis for
calculating the daily average of the worker’s
"total full time earnings" which means the
earnings he earns in a day by working full time on
that day, the full time to be in accordance with
the period of time given in the notice displayed
in the factory for a particular day and. therefore
the wages to be paid for the leave period could
not be calculated nor the number of days for which
leave with wages could be allowed be calculated in
such a case. The conviction of the appellant under
s. 92 read with s. 79(1) of the Act was wrong.
Per Subba Rao, J., dissenting,-The question
raised in the appeal was directly covered by the
judgment of this Court in Birdhi, Chand Sharma
case.
It could not be said that the appellant had
no right of supervision or control over the
labourers ill the factory or did not supervise to
the extent required having regard to the nature of
the work done in the factory.
Under s. 2(1) of the Act "worker" meant a
person employed, directly through any agency
whether for wages or not in any manufacturing
process. All the ingredients of the word
"employed" as laid down by this court were present
in this case and therefore the labourers were
workers within the meaning of s. 2(1) of the Act.
Birdhi Chand Sharma v. First Civil Judge,
Nagpur. [1961] 3 S. C. R. 161, Chaintaman Rao v.
State of M.P.[1958] S. C. R. 1340,
Dharangadhara Chemical Works v. State of
Saurashtra, [1957] S. C. R. 152, State of Kerala
v. V. M. Patel, and palaiappa v. Court of
Additional First Class Magistrate, Kulitalai I.
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L. R. 1958 Mad. 999, considered.
For the purpose of calculation of wages
during the leave period under s. 80, the full time
earnings for a day could be taken to mean the
amount earned by a worker for the daily hours of
work fixed for a factory. In the instant case the
workers were entitled to work throughout the fixed
working hours of the factors though they could
leave the factory at any time during those hours
and hey
251
were entitled to be paid their wages on the basis
of the number of the bidis rolled by them. The
wages earned by them during the working hours of
the factory would be no their full time earning
for the day. There could, therefore, be no
difficulty in ascertaining the rate under s. 80 of
their wages during, the leave period, for under
that section the workers would have to be paid at
a rate equal to the daily average of their total
full time earnings for the days they worked.
JUDGMENT:
CRIMINAL APPELLATE JURISDICTION: Criminal
Appeal No. 63 of 1960.
Appeal by special leave from the judgment and
order dated October 9, 1959, of the Bombay High
Court in Criminal Reference No. 94 of 1959.
A. V. Viswanatha Sastri, S. N. Andley and
Rameshwar Nath, for the appellant.
R. Ganapathy Iyer and R. H. Dhebar, for
respondent.
1961. October 27. The Judgment of Kanpur an
Dayal, JJ., was delivered by Dayal J. Subba Rao,
J., delivered a separate Judgment.
RAGHUBAR DAYAL, J.-This appeal, by special
leave, is directed against the order of the High
Court of Bombay, rejecting, the reference made by
the additional Sessions Judge, Nasik, and
confirming the conviction of the appellant under
s. 92 of the factories Act, 1948 (Act LXIII of
1948), hereinafter called the Act.
The appellant is the owner and occupier of
"Jay Parkash Sudhir Private Ltd., a factory which
manufactures bidis. Pandurang Trimbak Londhe,
hereinafter called Pandurang, rolled bidis in that
factory for a number of days in 1957. He ceased to
do that work from August 17, 1957. It was alleged
by the prosecution that the appellant terminated
Pandurang’s services by a notice put up on August
12, 1957. The appellant, however, admitted the
putting up of such a notice, but denied that
Pandurang, the labourer, had left his service of
his own accord.
252
Inspector Shinde, P.W.I, visited this factory
August on 22, 1957. He found from the weekly
register and the wages register of the Factory
that Pandurang worked for 70 days and earned 4
days T. leave. Pandurang, however, did not enjoy
that leave and was therefore entitled to be paid
wages for that period i.e., for 4 days’ leave. He
was not paid those wages, and therefore, the
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appellant contravened the provisions of s. 79(11)
of the Act. He consequently submitted a complaint
against the appellant to the Judicial Magistrate,
First Class, Sinnar.
It was contended for the accused before the
Magistrate that Pandurang was not a worker within
the meaning of that expression, according to
s.2(1) of the Act and that therefore no leave
could be due to him and the appellant could not
have committed the offence of contravening the
provisions of s.79(11). The learned Magistrate did
not agree with the defence contention and held
Pandurang to be a worker and convicted the
appellant of the offence under 8. 92 read with s.
79(11) of the Act and sentenced him to a fine of
Rs. 10.
It may be mentioned that this case was a test
case. Similar cases against the appellant with
respect to the non-payment of leave wages to other
workers were pending in the Court.
The appellant went in revision to the Court
of the learned Additional Sessions Judge, Nasik.
The Sessions Judge was of the opinion that
Pandurang was not a worker and that the conviction
of the appellant was bad. He accordingly referred
the case to the High Court. The High Court,
however did not agree with the view of the
Sessions Judge and, holding that Pandurang was a
worker, rejected the revision and confirmed the
conviction and sentence. It is against this order
that this appeal has been filed.
Two points have been raised on behalf of the
appellant. One is that Pandurang was not a
253
worker within the meaning of that expression in
the Act. The other is that even if Pandurang was a
worker, he was not entitled to any leave wages
under s. 80 of the Act.
The first contention is based on the
established facts of the case which, it is
submitted, do not make out the relationship of
master and servant between the appellant and
Pandurang, inasmuch as they indicate that the
appellant had no supervision and control over the
details of the work Pandurang did in the factory.
The following are the established facts:
(1) There was no agreement or contract
of service between the appellant and
Pandurang. (2) Pandurang was not bound to
attend the factory for the work of rolling
bidis for any fixed hours of work or for any
filed period. He was free to go to the
factory at any time he liked and was equally
free to leave the factory whenever he liked.
Of course, he could be in the factory during
the hours of working of the factory.
(3) Pandurang could be absent from work
on any day he liked. He could be absent up to
ten days without even informing the
appellant. If he was to be absent for more
than ten days he had to inform the appellant,
not for the purpose of taking his permission
or leave, but for the purpose of assuring the
appellant that he had no intention to give up
work at the factory.
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(4) There was no actual supervision of
the work Pandurang did in the factory.
(5) Pandurang was paid at filed rates on
the quantity of bidis turned out. There was
however no stipulation that he had to turn
out any minimum quantity of bidis in a day.
(6) Leaves used to be supplied to
Panduarng for being taken home and cut there.
254
Tobacco to fill the bidis used to be supplied
at the factory. Pandurang was not bound to
roll the bidis at the factory. He could do so
at his place, on taking permission from the
appellant for taking tobacco homes. The
permission was necessary in view of Excise
Rules and not on account of any condition of
alleged service.
(7) At the close of the day, the bidis
used to be delivered to the appellant and
bidis not up to the standard, used to be
rejected.
The second contention is based on the
inapplicability of the provisions of ss. 79 and 80
of the Act to the case of the appellant, inasmuch
as it is not possible to calculate the number of
days he worked or the total full time earnings for
the days on which he worked during the relevant
period mentioned in s. 80.
On behalf of the respondent State, it is
submitted that the appellant had the right to
exercise such supervision and control over the
work of Pandurang as was possible with respect to
the nature of Pandurang’s work which was of a very
simple kind and that therefore Pandurang was a
worker. It is further urged that there is no
difficulty in calculating the number of working
days or the total full-time earnings contemplated
by s. 80 of the Act.
We have given very anxious consideration to
this case, as the view taken by the Court below in
this case had been stated to be the right view in
the decision of this Court in Shri Birdhichand
Sharma. The first Civil Judge, Nagpur (1), on
which reliance is placed by the respondent. The
fact of that case are distinguished and only some
of the facts of that case are similar to some of
the facts of this class. The similar facts are
only these: Pandurang as well as the workers in
that case could go to the factory
(1) [1961] 3 S. C. R. 161.
255
at any time and leave it at and time, within the
filed hours of work and they were paid at piece
rates and the bidis below the standard were
rejected. It is to be noticed that the decision in
that case is based on facts which do not exist in
the present case. That decision, therefore, is
distinguishable and the opinion about the view of
the High Court in the present case to be correct,
appears to have been expressed without noticing
that the facts of this case are different in
material respects from the facts of the case this
court was deciding. The decision of that case it
based really on the following facts:
(1) The alleged workers had to work at
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the factory.
(2) Their attendance was notes.
(3) If they came to the factory after
mid-day, they were not given any work and
they thus lost wages.
(4) The management had the right to
remove them if them stayed away for a
continuous period of eight days.
In the present case, Pandurang could work at the
house if the appellant permitted tobacco to be
taken home. There is nothing on record to show the
attendance is noted. Of course, the days Pandurang
worked could be found out from the work register.
It is not the case here that no work was to be
given to Pandurang if he want to the factory after
mid-day. There is no allegation that the appellant
had the power to remove him, as a result of
continued absence for a fixed number of days. We
are therefore of opinion that the decision in
Birdhichand’s Case (1) is distinguishable on facts
and cannot be applicable to the facts of this
(1)[1961] 3 S. C.K. 161.
256
The one essential ingredient which should
exist to make a person come within the definition
of ’worker’ in cl. (1) of s. 2 of the Act is that
he be employed in one of the processes mentioned
in that Clause. There is no dispute that the work
which Pandurang did came within one of such
processes. The sole question for determination
then is whether Pandurang can be said to be
employed by the appellant.
This Court, in Shri Chintaman Rao v. The
State of Madhya Pradesh (1), said:
"The concept of employment involves
three ingredients: (1) employer (2) employee
and (3) the contract of employment,. The
employs is one who employs, i.e., one who
engaged the services of other persons. The
employee is one who works for another for
hire. The employment is the contract of
service between the employer and the employee
whereunder the employee agrees to serve the
employer subject to his control and
supervision."
Employment brings in the contrast of service
between the employer and the employed. We have
mentioned already that in this case there was no
agreement or contract of service between the
appellant and Pandurang. What can be said at the
most is that whenever Pandurang went to work, the
appellant agreed to supply him tobacco for rolling
bidis and that Pandurang agreed to roll bidis on
being paid at a certain rate for the bidis turned
out. The appellant exercised no control and
supervision over Pandurang.
Further s. 85 empowers the State Government
to declare that certain provisions of the Act
would apply to certain places where a
manufacturing process is carried on,
notwithstanding the persons therein are not
employed by the owner
(1) [1958] S. C. R. 1340, 1346,1349,1350,
1351.
257
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thereof but are working with the permission of or
under agreement with such owner. This provision
draws a distinction between the person working
being employed by the owner and a person working,
with the permission of the owner or under
agreement with him. We are of opinion that the
foots of this case strongly point to Pandurang’s
working with the permission of or under agreement
with the owner and not on any term of employment
by the owner.
Further, the facts of the case indicate that
the appellant had no control and supervision over
the details of Pandurang’s work. He could not
control his hours of work. He could not control
his days of work. Pandurang was free to absent
himself and was free to go to the factory at any
time and to have it at any time according to his
will. The appellant could not insist on any
particular minimum quantity of bidis to be turned
out per day. He could not control the time spent
by Pandurang on the rolling of a bidi or a number
of bidis. The work of rolling bidis may be a
simple work and may require no particular
supervision and direction During the process of
manufacture. But there is nothing on record to
show that any such direction could be given.
In this connection reference may again be
made to the observation at page 1349 in Shri
Chintaman Rao’s Case. The Court was considering
whether the Sattedars were workers or were
independent contractors Sattedars used to receive
tobacco from the management and supply them rolled
bidis. They could manufacture bidis outside the
factory and should also employ other labour. It
was in these facts, that it was said:
"The management cannot regulate the
manner of discharge of his work."
In the present case too, Pandurang used to be
supplied tobacco. He could turn out as many bidis
(1)[1958] S. C. R. 1340, 1346, 1349, 1350, 1351.
258
as he liked and could deliver them to the factory
when he wanted to cease working. During his period
of work, the management could not regulate the
manner in which he discharged his work. He could
take his own time and could roll-in as many bidis
as he liked. His liability under the daily
agreement was discharged by his delivering the
bidis prepared and the tobacco remaining with him
unused. The appellant could only order or require
Pandurang to roll the bidis, using the tobacco and
leaves supplied to him, but could not order him as
to how it was to be done. We are therefore of
opinion that the mere fact that the person rolling
bidis has to roll them in a particular manner can
hardly be said to give rise to such a right in the
management as can be said to be a right to control
the manner of work. Every worker will have to turn
out the work in accordance with the
specifications. The control of the management,
which is a necessary element of the relationship
of master and servant, is not directed towards
providing or dictating the nature of the article
to be produced or the work to be done, but refers
to the other incidents having a bearing on the
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process of work the person carries out in the
execution of the work. The manner of work is to be
distinguish. ed from the type of work to be
performed. In the present case, the management
simply says that the labourer is to produce bidis
rolled in a certain form. How the labourer carries
out the work is his own concern and is not
controlled by the management, which is concerned
only with getting bidis rolled in a particular
style with certain contents.
Further, this Court, in Shri Chintaman Rao’s
Case (1)examined the various provisions of the Act
and then said:
"The scheme of the aforesaid provisions
indicates that the workmen in the factory are
under the direct supervision and control of
the management. The conditions of service
(1) [1858] S.C.R. 1340, 1346, 1349, 1350, 1951.
259
are statutorily regulated and the management
is to conform to the rules laid down at the
risk of being penalised for dereliction of
any of the statutory duties. The management
obviously cannot fix the working hours,
weekly holidays, arrange for night shifts and
comply with other statutory requirements, if
the persons like the Sattedars, working in
their factories and getting their work done
by others or through coolies, are workers
within the meaning of the Act. It is well
high impossible for the management of the
factory to regulate their work or to comply
with the mandatory provisions of the Act. The
said provisions, therefore, give a clear
indication that a worker under the definition
of the Act is a person who enters into a
contract of service under the management and
does not include an independent contractor or
his coolies or servants who are not under the
control and supervision of the employer."
It can be said, in the present case too, that the
appellant could not fix the working hours or
weekly holidays or asked arrangements for night
shifts and comply with other statutory
requirements, if Pandurang be held to be a worker
within the meaning of the Act. We are therefore of
opinion that Pandurang was not a worker.
It is true, as contended for the State, that
persons engaged to roll his on job work basis
could be workers, but only such persons would be
workers who work regularly at the factory and are
paid for the work turned out during their regular
employment on the basis of the work done.
Piecerate workers can be workers within the
definition of ’worker’ in the Act, but they must
be regular workers and not-workers who come and
work according to their sweet will. It is also
true, as urged for the State that a worker, within
the
260
definition of that expression in the Act, need not
be a whole-time worker. But, even then, the worker
must have, under his contract of service, an
obligation to work either for a fixed period or J.
between fixed hours. The whole conception of
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service does not fit in well with a servant who
has full liberty to attend to his work according
to his pleasure and not according to the orders of
his master.
We may say that this opinion further finds
support from with we hold on the second
contention. If Pandurang was a worker, the
provisions about leave and leave wages should
apply to him. We are of opinion that they do not
and what we may in that connection reinforces our
view that Pandurang was not a worker as the three
criteria and conditions laid down in Shri
Chintaman Rao’s Case (1) for constituting him as
such are not fulfilled in the present case.
Before discussing the provisions of ss.79 and
80 of the Act. which deal with leave and wages for
leave, we would like to state that the terms on
which Pandurang worked, did not contemplate any
leave. He was not in regular employ. He was given
work and paid according to the work he turned out.
It was not incumbent on him to attend to the work
daily or to take permission for absence before
absenting himself. It was only when he, had to
absent himself for a period longer than ten days
that he had to inform the management for
administrative convenience, but not with a view to
take leave of absence.
Section 79 provides for annual leave with
wages and s. 80 provides for wages during leave
period. It is on the proper construction of the
provision of these sections that it can be said
whether the appellant contravened the provisions
of sub-s. (11) of 8. 79 of the Act and committed
the offence under s.92 of the Act.
(1) [1958] S. C. R. 1340, 1346, 1349,1350, 1351.
261
Sub-section (1) of s. 79 reads:
"(1) Every worker who has worked for a
period of 240 days or more in factory during
a calendar year shall be allowed during the
subsequent calendar year, leave with wages
for a number of days calculated at the rate
of-
(1) if an adult, one day for every
twenty days of work performed by him during
the previous calendar year;
(ii) if a child, one day for every
fifteen days of work performed by him during
the previous calendar year.
Explanation-1. For the purpose of this
sub-section-
(a) any days of lay off, by
agreement or contract or as permissible under
the standing orders,
(b) in the case of a female worker,
maternity leave for any number of days not
exceeding twelve weeks; and
(c) the leave earned in the‘ year prior
to that in which the leave is enjoyed;
shall be deemed to be days on which the
worker has worked a factory for the purpose
of computation of the period of 240 days or
more, but shall not earn leave for these
days.
Explanation-2. The leave admissible
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under this sub-section shall be exclusive of
all holidays whether occurring during or at
either end of the period of leave."
It is clear that this applies to every worker. If
it does not apply to any type of person working in
the factory, it may lead to the conclusion that
the person does not come within the definition of
the word ’worker’.
262
The worker is to get leave in a subsequent
year when he has worked for a period of 240 days
or more in the factory during the previous
calendar year. Who can be said to work for a
period of J. 240 days?
According to cl. (e) of 8. 2, ’day’ means a
period of twenty-fore hours beginning at mid-
night. Section 51 lays down that no adult worker
shall be required or allowed to work in a factory
for more than forty-eight hours in any week, and,
according to s. 54, for not more than nine hours
in any day. Section 61 provides that there shall
be displayed and correctly maintained in every
factory a notice of periods of work for adults
showing clearly for every day the periods during
which adult worker may be required to work and
that such periods shall be fixed beforehand and
shall be such that workers working for those
periods would not be working in contravention of
any of the provisions of ss. 51, 52, 54, 55, 56
and 58.
Section 63 lays down that no adult worker
shall be required or allowed to work in any
factory otherwise than in accordance with the
notice of periods of work for adults displayed in
the factory. A ’day’, in this context, would mean
a period of work mentioned in the notice
displayed. Only that worker can therefore be said
to work for a period of 240 days, whose work is
controlled by the hours of work he is required to
put in, according to the notice displayed under s.
61.
Pandurang was not bound to work for the
period of work displayed in the factory and
therefore his days of work for the purpose of s.
79 could not be calculated. It is urged for the
State that each day on which Pandurang worked,
whatever be the period of time that he worked,
would count as one day of work for the purpose of
this section. We do not agree with this
contention. When the section provides for leave on
the basis of
263
the period of working days, it must contemplate a
definite period of work per working day and not
any indefinite period for which a person may like
to work on any particular day.
Section 80 provides for the wages to be paid
during the leave period and its sub-s.(1)reads:
"For the leave allowed to him under
section 79, a worker shall be paid at a rate
equal to the daily average of his total full
time earnings for the days on which he worked
during the month immediately preceding his
leave, exclusive of any overtime and bonus
but inclusive of dearness allowance and the
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cash equivalent of the advantage accruing
through the confessional sale to the worker
of foodgrains, and other articles."
The question is how the daily average of his total
full time earnings for the days on which he worked
during the month immediately preceding his leave
is to be calculated. It is necessary for the
calculation of the rate of wages on leave, to know
his, total ’full time earnings,’ for the days he
had worked during the relevant month. What does
the expression ’total full time earnings’ mean?
This expression is not defined in the Act. It can
only mean the earnings he earns in a day by
working full time of that day, full time to be in
accordance with the period of time given in notice
displayed in the factory for a particular day.
This, is further apparent from the fact that any
payment for overtime or for bonus is not included
in computing the total full time earnings
Full time’, according to Webster’s
International Dictionary, means the amount of time
considered the normal or standard amount or
working during a given period, as a day? week or
month’.
264
In Words & Phrases, Permanent Edition,
published by West Publishing Co., Vol. 17, with
regard to the expression ’Full time’ it is stated:
In an industrial community, term ’full
time’ has acquired definite significance
recognized by popular usage. Like terms ’part
time’ and ’over time’ it refers to customary
period of work; and all these terms assume
that a certain number of hours per day or
days per week constitute respectively a days
or week’s work within a given industry or
factory."
It is also stated at page 791:
" ’Full time’ as basis for determination
of average weekly wages of injured employee
means time during which employee is offered
employment, excluding time during which he
has no opportunity to work."
We are therefore of opinion that there can be no
basis for calculating the daily. average of the
worker’s total full time earnings when the terms
of work be as they are in the present case and
that therefore the wages to be paid for the leave
period cannot be calculated nor the number of days
for which leave with wages can be allowed be
calculated in such a case. It does not appear from
the record, and it is not likely, that any period
of work is mentioned in the notice displayed under
s. 61, with respect to such workers who can come
at any time they like and go at any time they like
and turn out as much work as they like.
For the reasons stated above, we are of
opinion that the conviction of the appellant for
an offense under s. 92; read with s. 79(11) of the
Act is wrong. We accordingly set aside the order
of the Court below and acquit the appellant. Fine,
if paid, will be refunded.
265
SUBBA RAO, J.-I have had the advantage of
perusing the judgment Prepared by my learned
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brother day, J. I regret my inability to agree.
The question raced in this appeal is directly
covered by the judgment of this Court in Birdhi
Chand, Sharma v. First Civil Judge, Nagpur (1). As
my learned brother has taken a different view, I
propose to give reasons for my conclusion.
This appeal by special leave is directed
against the judgment of the High Court of Bombay
in Criminal Reference No. 94 of 1955 made by the
Additional Sessions Judge. Nasik, under s. 438 of
the Code of Criminal Procedure, and it raises the
question of interpretation of some of the
provisions of the Factories Act, 1948 (63 of
1948), (hereinafter referred to as the Act).
The appellant is the owner of a factory named
’’Jay Parkash Sudhir Private Ltd." engaged ill the
manufacture of bidis. He engaged 60 persons for
the work of rolling bidis in his factory. On
August 12, 1267, the appellant issued a notice to
the said persons terminating their services with
effect from August 17, 1957. On August 22, 1957,
the Inspector of Factories paid a visit to the
factory found that one of the said persons by name
Pandurang Trimbak had worked for 70 days in the
factory and had earned leave for 4 days which he
had not enjoyed nor was he paid wages in lieu of
the leave before his discharge. It is not disputed
that the position in regard to the other 59
persons is also similar. The Inspector of
Factories filed 60 complaints against the
appellant in the Court of the Judicial Magistrate,
First Class, Sinnar, For infringing the provisions
of s. 79(2) of the Act. The Magistrate found to
appellant guilty and convicted and sentenced him
to pay a fine of Rs. 10 On revision, the learned
Additional Sessions Judge, Nasik, taking the view
that the convection should be quashed. referred
the matter
(1) [1961] 3 S.C.R. 161.
266
to the High Court under s. 438 of the Code of
Criminal Procedure. A division bench of the a High
Court, on a consideration of the facts found the
material provisions of the Act and the relevant
decisions cited, come to the conclusion that a
person rolling bidis in a factory is a "worker"
within the meaning of B. 2(1) of the Act and on
that basis upheld the order of conviction and
sentence passed by the learned Magistrate. Hence
this appeal.
Learned counsel for the appellant contends
that the persons rolling bidis in the factory are
not "workers" within the meaning of the Act, as
the said persons can come any day they like, work
as they like and, therefore, they cannot be said
to by employed by the manufacturer under the Act.
Alternatively he argues that even if they were
’’workers", s. 79 of the Act, which deals with the
question of leave with wages, cannot apply to a
worker who is paid wages according to the quantity
of work done by him and not per day or par week.
At the outset it would be convenient to
ascertain exactly how these persons rolling bidis
are engaged by the appellant and how they work ill
the factory. Admittedly, Pandurang Trimbak and
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other 59 persons were engaged by the appellant for
rolling bidis in his factory. The registers
maintained by the factory, namely, weekly register
and wages register, had on their rolls the names
of the said persons as labourers for doing the
said work. It is also common case that the said
persons attend the factory and roll bidis in the
premises of the factory during the working hours
of the factory. Leaves are supplied to the
labourers on the previous day, which they cut in
their houses after dipping them in water, and on
the neat day, when they go to the factory, tobacco
is given to them. After they make the bidis the
matter verifies whether they are according to the
sample. Those that are not according to the sample
are rejected. Thereafter the quantity of
267
bidis rolled by each labourer is entered in the
bidi-map register maintained by the factory. D. W.
1 is a gumasta and general supervisor in the
factory. He supervises the work of the man who
supplies tobacco. He enters the quantity of bidis
rolled by each labourer against his name in the
register and if a labourer is absent, his absence
is noted against his name in the said register.
The labourers are paid at the rate of Rs. 2-2-O,
or such other rate as agreed by them, per thousand
bidis rolled. So far there is no difference
between a labourer working in the appellant’s
factory and a labourer working in any other
factory. Just like any other manufacturer, the
appellant engages the labour, allots work for them
and extracts work from them and pays them wages
for the work so done.
Now let us look at the differences between
the labourers in a bidi factory and those in other
factories on which much emphasis is laid by
learned counsel for the appellant. P. W. 1, the
Inspector of Notified Factories, says that during
their working in the factory, there, is no
supervision over them. P. W. 2, Pandurang Trimbak,
admits in the cross-examination that during the
factory hours he used to work in the factory of
the appellant at any time and go at any time. He
further states that they can sit at any
compartment of the factory and there is no
compulsion on the labourer to do a minimum
quantity of work every day and that the permission
of the master is required only if a labourer wants
to absent for more than ten days or when he wants
to bind bidis in his house. D. W. 1, the gumasta
and supervisor in the factory, also says that a
labourer can leave the factory in the midst of
work after giving the finished product and after
returning the tobacco. He says that at the time of
receiving the finished goods, he verifies whether
the goods are according to sample and then makes
the requisite entries in
268
the register. What emerges from this evidence is
that there in no supervision in the sense that
nobody regulary watches their work from start to
finish giving directions, if and when required.
But the labourers understand that the bidis to be
rolled in by them shall accord with the sample
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and, therefore, they roll the bidis to accord with
that sample. The names of persons that are absent,
the quantity of tobacco issued to each of the
labourer, and the number of bidis rolled by each
of them are entered in the appropriate registers.
The rejected bidis are given way to the labourers;
it cannot obviously mean that dereliction of duty
is rewarded but it only shows that the rejected
bidis are insignificant in number. In short, the
appellant engages a labourer, extracts work from
him, pays him wages in accordance with the
quantity of bidis rolled by him, and exercises a
right of supervision as the nature of the work
requires.
With this background let us look at the
definition of "worker ’ in s. 2(1) of the act
’’Worker" is defined to mean ’’a person employed,
directly or through agency, whether for wages or
not in any manufacturing process. "Under this
definition, a person employed in a manufacturing
process in a worker. The question raised in this
case turns upon the interpretation of the word
’employed" in the definition. This Court in
Chintaman Rao v. State of Madhya Pradesh (’1A)
defined the word ’’employed" thus:
"The concept of employment involves
three ingredients: (1) employer (2) employee
and (3) the contract of employment. The
employer is one who employs, i.e., one who
engages the services of other persons. The
employee is one who works for another for
hire. The employment is the contract of
(1A) [1958] S.C.R. 1340, 1346.
269
service between the employer and the
employee whereunder the employee agrees to s
serve the employer subject to his control and
supervision."
In making out the distinction between an employer
and an independent contractor, this court in the
above case quoted the following observations of
Bhagwati J, in Dharangadhara Chemical Works Ltd .
v. State of Saurashtra (1):
"The test which is uniformly applied in
order to determine the relationship is the
existence of a right of control in respect of
the manner in which the work is to be done."
The some view was reiterated. by this Court in
The State of Kerala v. V.M. Patel (2). That was a
case where 23 persons were employed in the process
of garbling pepper and packing them in bags.
Hidayatullah, J."speaking for the Court stated:
"It was observed that, to determine
whether a person was a ’"worker", the proper
test was to see whether or not the "employer"
has control and supervision over the manner
in which the work was to be done".
Adverting to the distinction between an
independent contractor and a servant, the learned
Judge proceeded to state:
"An independent contractor is charged
with a work and has to produce a particular
result; but the manner in which the result is
to he achieved left to him. A servant, on the
other hand may also be charged with the work
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and asked to produce a particular result, but
is subject to the directions of the matter as
to the manner in which tho result is to be
achieved."
(1) [1957] S.C.R.152,157.
(2) Criminal Appeal No. 42 of 1959 decided on
12-10- 60.
270
This decision also emphasized that a right to
control or supervise is one of the tests for
determining the relationship of master and
servant. In this context a judgment of the Madras
High Court in Palaniappa v. Court of Additional
First Class Magistrate, Kulitalai (1) is strongly
relied upon on behalf of the appellant. There, the
petitioner was the owner of a weaving concern at
Karur. He had put up a thatched shed where he had
installed a certain number of handlooms and where
towels and bed-sheets were manufactured. His
office consisted of only two clerks, who were this
permanent members of his establishment. Some of
the residents of the village, most of whom were
agriculturists, but who knew waving used to go to
the petitioner’s shed when they had e, and when
they felt inclined to do to and they were supplied
with yarn. These, they wove into bed sheets and
towels and they were paid at certain rates for the
articles they wove. These persons came in and went
out when they liked. On those facts, Balakrishna
Ayyar, J., held that they were not "workers"
within the definition of the word ’"worker" in the
Factories Act. After considering the relevant
decisions cited and after distinguishing the cases
arising under the Industrial Disputes Act, the
learned Judge proceeded to state thus:
"An examination of these decision
confirms what one was inclined to suspect at
the outset, viz., that "employed" is a word
with a varying content of meaning and that it
signifies different things in different
places .................. On the other hand,
when we say that X is employed by Y we
ordinarily imply that Y remunerates X for his
services and that he has a certain measure of
control over his time and skill and labour.
But the degree and extent of conrlto may be
nominal or extensive ....................
(1) I.L.R. 1958 Mad. 999, 1009, 1010.
271
In between lie infinite grades of control and
supervision. But a certain amount of
supervision or control is necessarily implied
in the connotation of the word ‘employed’."
Having said that, the learned Judge graphically
describes the relationship between the parties
thus:
"The worker can come any day he likes,
work as long as he likes or as short as he
likes and go away. He may work fact or he may
work slow. The petitioner cannot tell him
that he should work on towels and not on bed-
sheets or vice versa........................
And, more important of all the petitioner
cannot prevent anybody from working for a
competing manufacturer. Come when you like,
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go when you like, work when you like, stop
when you like, work as fast as you like, work
as slow as you like, work on what you like or
not at all, that the position of the workers
vis-a-vis the petitioner. Such persons
cannot, in my opinion, be said to be
’employed’ by the petitioner within the
meaning of clause (1) of section 2 of the
Factories Act."
It is not necessary to express our opinion whether
the conclusion of the learned Judge on the facts
of that case is correct or not. But the principle
accepted by him, namely, that a certain amount of
supervision or control is necessarily implied in
the connotation of the word "employed", has been
accepted by this Court in earlier decisions and
this decision is only an application of that
principle to a different set of facts.
The present case falls to be decided on its
peculiar facts. As we have pointed out, though
there is some laxity in the matter of attendance,
it cannot be said that the appellant has no right
of supervision or control over the labourers
working in the factory or does not supervise to
the extent required having regard to the nature of
the
272
work done in the factory. All the necessary
’ingredients of the word "employed" are found in
the case. The appellant engages the labourers, he
entrusts them with work of rolling bidis in
accordance with the sample, insists upon their
working in the factory, maintains registers giving
the particulars of the labours absent, amount of
tobacco supplied and the number of bidis rolled by
each one of them, empowers the gumasta and
supervisor, who regularly attends the factory, to
supervise the supply of tobacco and leaves and the
receipt of the bidis rolled. The nature and
pattern of bidis to be rolled is obviously well
understood, for it in implicit in requirement that
the rolled in bidis shall accord with the sample.
The rejection of bidis found not in accord with
the sample is a clear indication of the right of
the employer to dictate the manner in which the
labourers shall manufacture the bidis. Supposing a
worker uses more quantity of tobacco than a bidis
is, expected to contain, it cannot be suggested
that the supervisor cannot tell him that he shall
not do to. If he spoils the leaves, which he in
not expected to do, it cannot be said that the
labourer cannot be pulled up in the direction. So
too, the supervisor can certainly compel the
labourers to work in a specified portion of the
factory or direct them to keep order a rid
discipline in the course of the discharge of their
duties. The fact that they cannot take the tobacco
outside the factory without the leave of the
management shows that they are subject to the
supervision of the management. The circumstance
that they cannot absent them selves for more
than 10 days without the permission of the
appellant also is a pointer in that direction.
That a labourer is not compelled to work
throughout the working hours is not of much
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relevance, because, for all practical purpose, a
labourer will not do so since his wage depends
upon the bidis he rolls, and, as he cannot roll
them outside the factory, necessarily
273
he will have to do so in the factory. If he
absents himself, it is only at his own risk.-For
all the aforesaid reasons I hold that all the
ingredients of the word "’employed", as laid down
by this Court are present in this case, and
therefore the labourers are workers within the
meaning of s. 2(1) of the Act.
The next contention of learned counsel for
the appellant was that even if the labourers in
the factory were workers within the meaning of the
Act, s. 79 thereof would not apply to them and,
therefore, there could not have been any
contravention of that section. The material part
of s. 79 of the Act reads:
"Every worker who has worked for a
period of 240 days or more in a ‘factory
during a calendar year shall be allowed
during the subsequent calendar year, leave
with wages for a number of days calculated at
the rate of-
(1) if an adult, one day for every
twenty days of work performed by him during
the previous calendar year;.. ".
Section 80 says,
(1) "For the leave allowed to him under
section 79,a worker shall be paid at a rate
equal to the daily average of his total full
time earnings for the days on which he worked
during the month immediately preceding his
leave, exclusive of any overtime and bonus
but inclusive of dearness allowance and the
cash equivalent of the advantage accruing
through the concessional sale to the worker
of foodgrains and other articles "
The argument is that SS. 79 and 80 have to be read
together and that 8. 79 cannot be applied to a
worker to whom s. 80 does not apply. Section 80,
the argument proceeds, entitles a worker for
274
leave allowed to him under s. 79 to be paid at a
rate equal to the daily average of his total full
time earnings for the days for which he worked
during the month immediately preceding his leave
and that as the workers in question had the option
to work for the full day or part of the day, the
words "full time earnings" would not apply to
them. This argument, though at first blush appears
to be plausible, on a deeper scrutiny reveals that
it is unsound. The following words stand out in s.
80(1) full time earning and (ii) days. "Day" has
been defined in s. 2(e) to mean ’"a period of
twenty four hours beginning at midnight". It
cannot be suggested, and it is not suggested, that
"’full time earnings" for a day means earnings
made during all the twenty- four hours. Such a
contention cannot be raised for the reason that
the provision of the Factories Act restrict the
number of hours of work during the day of twenty-
four hours. Under s. 51 of the Act, ’"No adult
worker shall be required or allowed to work in a
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factory for more than forty-eight hours in one
week", and under a 54, "Subject to the provisions
of section 51, no adult worker shall be required
or allowed to work in a factory for more than nine
hours in any day". A combined reading of these two
sections indicates that subject to the maximum
period of working hours fixed for a week, no
worker shall be allowed to work for more than a
hours a day. For the purpose of calculation of
wages during the leave period under s. 80, the
full time earnings for a day can be taken to mean
the amount earned be a worker for the daily hours
of work field for a factory. In the instant case
it is admitted that the working hour for the
factory are filed and the workers are entitled to
work throughout the working hours, though they can
leave the factory during those hours if they
choose to do so. But they cannot be prevented from
working for all the hours fixed for the factory
and they are entitled
275
to be paid their wages on the basis of the number
of bidis rolled by them. The wages earned by them
during the working hours of the factory would be
their full time earnings for the day. If so, there
cannot be any difficulty for the management to
ascertain the rate under B. 80 of the Act for the
payment of wages during the leave period, for
under that section the management would have to
pay at a rate equal to the daily average of their
total full time earnings for the days they worked.
The factory registers would show the total full
time earnings of each worker for the days during
the month immediately preceding his leave. The
average shall be taken of the earnings of those
days and the daily average of those earnings would
be the criterion for fixing the wages during the
leave period. I cannot, therefore, say that s. 79
of the Act by its impact on s. 80 thereof makes it
inapplicable to a worker of the category with
which we are now concerned. This argument,
therefore, is rejected.
No other question was raised before us. In
the result, the appeal fails and is dismissed.
By Court. In accordance with the opinion of
the majority the appeal is allowed, the order of
the Court below set aside and the appellant
acquitted. Fine, if paid, will be refunded.
Appeal allowed.
276