Delhi High Court
V.K. Sharma And Ors. vs Union Of India And Ors. on 31 August, 2001
Author: Mukundakam Sharma
Bench: Mukundakam Sharma
JUDGMENT Mukundakam Sharma, J.
1. The petitioners herein have sought for a direction to respondent No. 2, namely - Indian Institute of Technology (in short, described as IIT) to absorb the petitioners as their permanent employees with all consequential benefits and also to prescribe appropriate service conditions to all classes of Canteen workers from Manager to cleaners.
2. It is stated by the petitioners in the writ petition that the petitioners have been working in the IIT Staff Canteen for a period of 5-16 years in various capacities. According to the petitioners the said Canteen has been running continuously since 1981 without any interruption and has become an essential and inseparable part of the Indian Institute of Technology. It is contended that the said Canteen was run on a Cooperative basis for a period of 10 years and subsequently the said society was dissolved and the present staff canteen was started by the IIT for the benefit of the employees, which is being run by a Managing Committee constituted by the Institute of Technology and therefore, according to the petitioners they are to be absorbed as the regular employees of the Indian Institute of Technology and hence the present petition.
3. The respondents No. 2 & 3 have filed their counter affidavit contending inter alia that the petitioners cannot be declared as the employees of the Institute. It is stated that the petitioners are working in the canteen which provides canteen facilities to class III and Class IV employees of the Institute and that the Institute is neither the appointing authority nor are the petitioners under its control and supervision of the Institute and that there exists no relationship of master and servant between the petitioners and the Institute. It was stated that the petitioners were engaged by the Managing Committee of the Canteen which is an independent body and is not a part of the Institute itself. It was stated that the said canteen is not a statutory canteen and was provided as a welfare measure to the employees. It was further contended that the petitioners were not appointed by the Institute pursuant to any advertisement for selection. Categorical assertion is made that the petitioners were appointed not through any selection process and as such there exists no relationship of employee and employer between the petitioners and the Institute. It is contended that the Institute does not supervise or control the working of the canteen or the supply of eatables to the employees and that the employees of the Institute are not under any obligation to purchase eatables from the canteen and that it has no right to take any disciplinary action or to direct the employees of the canteen to do a particular work.
4. In the light of the aforesaid pleadings of the parties the question that falls for my defemination in this case is - whether the petitioners could be said to be employees of the respondent Institute and whether there exists a relationship of master and servant between the petitioners and the respondent Institute. Mr. Venkatramani, Senior Advocate appearing for the petitioners drew my attention to the various correspondences filed by the petitioners Along with the writ petition and on the basis thereof contended that such a relationship of master and servant exists between the petitioners and the respondent Institute and therefore, according to him in the light of various decisions of the Supreme Court in A.V. Venkateshwara v. Ram Chand, , IPCL and Anr. v. Shramik Seva and Ors., JT 1999(5) SC 340, SBI and Ors. v. SBI Canteen Employees, 2000(5) SCC 351, IOB v. IOB Staff Canteen Workers, 2000(3) Scale 255 and G.B. Pant University v. State of U.P. and Ors., 2000(5) Scale 569, a declaration as sought for in the writ petition should be issued by this court.
5. It was contended by the counsel for the petitioners that the respondent Institute exercised full control and supervision over the canteen of the Institute and that the said canteen was run and controlled by the respondent Institute. It was also sought to be submitted that the said canteen was established and is being managed by a Managing Committee constituted by the IIT and was established for the benefit of the IIT employees and that for disciplinary action as against any of the petitioners Rules of the IIT are being followed. It was also submitted that the respondents have been paying 100% subsidy towards the pay of the canteen employees and that all the infrastructure is provided by the respondents and that the water and electricity bills etc. are also being paid by the IIT. In order to substantiate his plea, counsel submitted that IIT is providing uniforms, washing allowance, kitchen equipment, gas and crockery and the medical facilities and also making contribution towards Provident Fund and providing with house rent allowance, dearness allowance and additional dearness allowance and that in that view of the matter there exists a relationship of master and servant between the petitioners and the respondent Institute.
6. Mr. Maninder Singh, appearing for the Institute however, submitted that there is no relationship of master and servant between the petitioners and that respondent institute only provides subsidy in order to promote canteen facilities on the basis of which the petitioners cannot claim to be direct employees of the Institute as the Institute was not running the canteen by itself. He also took a preliminary objection contending inter alia that since disputed questions are involved in the present writ petition the petitioners should have approached the Industrial Tribunal to establish their rights and therefore, no relief should be granted to the petitioners in the present writ petition.
7. In the light of the aforesaid submissions of the counsel appearing for the parties let me examine the issues raised before me. So far the preliminary objection raised by the respondent Institute is concerned it is needless to mention that the petitioners should have approached the Industrial Tribunal to establish their rights, if any, for the issue raised in the writ petition definitely involves disputes questions of fact. Whether or not there exists a relationship of master and servant between the petitioners and the respondent institute are all questions of fact which could properly, appropriately and effectively investigated upon by an appropriate forum having jurisdiction in the matter. The decisions relied upon by the counsel appearing for the parties almost invariably arise out of the proceedings under the Industrial disputes Act. Be that as it may, since arguments were advanced on merits of the issue involved I would propose to appreciate the same and dispose of the writ petition on merits itself.
8. It is not in dispute that initially when the canteen was started the same was being run on a co-operative basis. However, subsequently somewhere around 1981 the Institute decided to provide subsidy to the canteen. In view of the introduction of the aforesaid subsidy system it became necessary for the Institute to check the accounts of the canteen. However, since the same was also a cooperative canteen the Auditor deputed by the Registrar, Cooperative Societies was also checking the accounts of the canteen. Accordingly, certain confusions anomalies and difficulties arose. Therefore, the management of the canteen, at that point of time, decided to dissolve the cooperative base of the canteen, and a new canteen under the name and style of IIT Staff Canteen was started. The management of the aforesaid canteen is being looked after by a Managing Committee consisting of 3 members nominated by the Director and 3 members to be elected by the employees of the Institute. The aforesaid informations are derived from the proposal and the communication dated 19.8.1981 placed as annexure 'X' to the writ petition. In this connection reference may also be made to another document at page 107 of the writ petition wherein it is stated that the subsidy of the IIT staff canteen is being given from the Institute to make some improvements in the functioning of the canteen and to provide more and standardised items of refreshment to the employees of the Institute.
9. A copy of the appointment letter is also placed on record. The said appointment letter was issued to one of the petitioners by the Chairman for on behalf of the Managing Committee. It is an admitted position that the IIT Staff Canteen is not a statutory canteen. A document is placed on record by the petitioner as Annexure 'X' at page 117 which is a resolution adopted by the Managing Committee to consider payment of enhanced subsidy to IIT staff canteen on account t of revised pay and allowance of the employees of non-statutory canteens. It is indicated there from that the IIT staff canteen is not a statutory canteen but in the absence of any other norms the Institute is following the norms of the Government Departmental Canteens as a guideline to run the IIT Staff Canteen. The institute is at present paying 100% subsidy towards the pay of the canteen employees. By the aforesaid resolution the Managing Committee decided to enhance the pay of the staff in terms of the Government of India notification and also to pay dearness allowance, additional dearness allowance at par with the employees of the Institute. It was categorically stated by the respondent that the Institute has no right to take any disciplinary action or to direct any canteen employee to do a particular act nor any disciplinary control over the persons employed in the canteen is vested on the Institute. There is no say or control regarding the allocation of work or the way in which the work is carried out by the said employees. It is also indicated therein that sanctioning of leave, distribution of work, maintenance of allowance register, are all done by the managing committee of the canteen. Although it is admitted by the respondents that provident fund contributions, payment of dearness pay and dearness allowance and various other benefits like uniforms, washing allowances, kitchen equipment, medical facilities are made from the subsidy provided by the Institute but according to the respondent Institute the same would not establish a relationship of master and servant between the petitioner and the respondent Institute.
10. In the background of the aforesaid facts I may also examine various decisions relied upon by the counsel appearing for the parties. In M.M.R. Khan and Ors. v. Union of India and Ors., 1990 (Supp.) SCC 191 the Supreme Court categorised various canteens in three categories namely - (i) Statutory Canteens; (ii) Non-Statutory Recognised Canteens and (iii) Non-Statutory Non-Recognised Canteens. It was laid down therein that statutory canteens are those canteens which are required to be provided compulsorily in view of the provisions of Section 46 of the Factories Act whereas non-statutory recognised canteens are run in establishments which may or may not be governed by the Factories Act which admittedly employ 250 or less than 250 employees and have been set up as a staff welfare measure where the employees exceed 100 in number and are set up with the prior approval and recognition. On the other hand, Non-Statutory Non-Recognised Canteens are those canteens which are run at establishments employing 100 or less than 100 employees and are established without prior approval or recognition. The said decision was rendered in the context of the Railways.
11. In Reserve Bank of India v. Workmen, , a three Judges Bench of the Supreme Court took notice of the decision in M.M.R. Khan's case (supra) and on consideration thereof it was held that the Reserve Bank of India is under no statutory or other legal obligation to provide canteen facilities to its employees. In the said decision the Supreme Court, while examining the issue as to whether a person is a workman and the relationship of master and servant exists in a particular case considered various decisions of the Supreme Court. The Supreme Court referred to the earlier decisions of the Supreme Court in Dharangadhra Chemical Works Ltd. v. State of Saurashtra, , Chintaman Rao v. State of M.P., and in the decision in Puri Urban Cooperative Bank v. Madhusudhan Sahu, (1992) SCC 323 and approved the ratio laid down therein. After referring to the said judgments it approved the principle of law laid down that prima facie test for determination of relationship of master and servant is the existence of the right in the master to supervise and control the work done by the servant not only in the matter of directing what work the servant is to do but also the manner in which he shall do his work. In Puri Urban Cooperative Bank v. Madhusudhan Sahu (supra) the Supreme Court held that Industrial Law revolves on the axis of master and servant relationship and by a catena of precedents it stands established that the prima facie test of relationship of master and servant is the existence of the right in the master to supervise and control the work done by the servant not only in the matter of directing what work the servant is to do but also the manner in which he shall do his work.
12. In Parimal Chandra Raha v. Life Insurance Corporation of India, 1995 (Supp.) II SCC 611 the Supreme Court after adverting to the earlier decisions summarised the law of the judgment thus:
"What emerges from the Statute Law and the judicial decisions is as follows:
(i) Whereas under the provisions of the Factories Act, it is statutorily obligatory on the employer to provide and maintain canteen for the use of his employees, the canteen becomes a part of the establishment and, therefore, the workers employed in such canteen are the employees of the management.
(ii) Where, although it is not statutorily obligatory to provide a canteen, it is otherwise an obligation on the employer to provide a canteen, the canteen becomes a part of the establishment and the workers working in the canteen, the employees of the management. The obligation to provide a canteen has to be distinguished from the obligation to provide facilities to run canteen. The canteen run pursuant to the latter obligation, does not become a part of the establishment.
(iii) The obligation to provide canteen may be explicit or implicit. Where the obligation is not explicitly accepted by or cast upon the employer either by an agreement or an award, etc. it may be inferred from the circumstances, and the provision of the canteen may be held to have become a part of the service conditions of the employees. Whether the provision for canteen services has become a part of the service conditions or not, is a question or fact to be determined on the facts and circumstances in each case.
Where to provide canteen services has become a part of the service conditions of the employees, the canteen becomes a part of the establishment and the workers in such canteen become the employees of the management.
(iv) Whether a particular facility or service has become implicitly a part of the service conditions of the employees or not, will depend, among others, on the nature of the service/facility, the contribution the service in question makes to the efficiency of the employees and the establishment, whether the service is available as a matter of right to all the employees in their capacity as employees and nothing more, the number of employees employed in the establishment and the number of employees who avail of the service, the length of time for which the service has been continuously available, the hours during which it is available, the nature and character of management, the interest taken by the employer in providing, maintaining, supervising and controlling the service,the contribution made by the management in the form of infrastructure and funds for making the service available etc."
The facts of the present case are therefore, to be examined in the light of the aforesaid principles of law laid down by the Supreme Court.
13. It is an admitted position that the respondent Institute has no statutory obligation under the provisions of the Factories Act to provide and maintain a Canteen for use of its employees. Therefore, the canteen in the Institute cannot be said to be a statutory canteen which is also an admitted position. Therefore, it is to be scrutinised whether it is otherwise an obligation on the employer to provide a canteen, in which case the canteen becomes a part of the organisation and the workers working in the canteen become the employees of the management. It is to be understood clearly as laid down by the Supreme Court that the obligation to provide a canteen has to be distinguished from the obligation to provide facilities to run the canteen. The obligation to provide the canteen could be deduced either explicitly or by implication. Explicit obligation could be deduced when there is an agreement or an award. In the present case there is neither an agreement nor an award and therefore, there is no explicit obligation of the Institute to provide a Canteen. I have therefore, to examine from the circumstances, and to find out whether from the said circumstances it could be inferred that there was an implied obligation to provide a canteen. The circumstances from which such an obligation could be inferred are service conditions of the employees, the nature of service/facilities, the contribution, and also from the fact as to whether the service is available as a matter of right to all the employees in their capacity as employees and also factors like - the number of employees employed in the established and the number of employees who avail of the service, the length of time for which the service has been continuously available, the hours during which it is available, the nature and character of management, the interest taken by the employer in providing, maintaining, supervising and controlling the service, the contribution made by the management in the form of infrastructure and the funds for making the service available. All the aforesaid circumstances relate to question of fact. The respondents have categorically stated that the respondent institute has no power to supervise or to control the work or the details thereof in any manner regarding the canteen workers nor it has any control so far the discipline of the canteen workers is concerned. The very fact that atleast three members of the Management Committee are appointed from the employees are elected would show that the Management Committee is a separate entity altogether from the Institute and the said three members would definitely have say in the matter of management, control and supervision of the canteen and therefore, the institute shall not have any exclusive power of supervision and control of the work or the details thereof in relation to the canteen workers. Besides, the facility of the canteen at IIT is not available as a matter of right of the employees but the said facility is being made available only as a welfare measure.
14. In State Bank of India and Ors. v. State Bank of India Canteen Employees' Union (bengal Circle) and Ors., it was held that even assuming that the privilege of providing canteen facilities to the employees exists, it cannot be held that the bank should provide the said facility by running a canteen by itself and that to promote canteen facilities by providing subsidy or other facilities is altogether from running the canteen. When canteens are run as a welfare measure the employees thereof would not become the employees of the bank as the bank would not have any statutory or contractual obligation or obligation arising under the award to run such canteens.
15. In the present case the facts are almost similar. There is no obligation statutory or otherwise to run the canteen by the Institute. The institute is not employing the canteen workers by itself not it is supervising or controlling the work or the details regarding the canteen or its employees appointed by the Managing Committee. Auditing the accounts because of the subsidy given by it to see whether it was properly utilised or not could not be a ground for holding that the institute is having any control in running the canteen. The Institute is not taking any disciplinary action or directing any employ to do a particular work or for that purpose no appointment is made by the Institute so far the canteen workers are concerned. Further the Institute has to make appointment in terms of its Recruitment Rules after giving proper advertisement and after following the process laid down therein. No such procedure was followed while appointing the staff of the canteen. In that view of the matter the canteen run by the Institute could be said to be a Non-Statutory Non-Recognised Canteen because there is neither statutory provision nor any obligation arising out of the award or contract between the employees of the Canteen and the Institute for running the canteen. In the light of the aforesaid discussion, it is proved and established that there is no relationship of master and servant between the staff of the canteen and IIT.
16. Therefore, in the light of the aforesaid settled principles of law laid down by the Supreme Court I am of the considered opinion and hold that the employees of the canteen would not become employees of the Institute. The writ petition, therefore, has no merit and is dismissed accordingly. However, in the circumstances there will be no order as to cost.