Calcutta High Court (Appellete Side)
Indian Oil Corporation Limited vs The Presiding Officer on 8 October, 2013
Author: Sambuddha Chakrabarti
Bench: Pranab Kumar Chattopadhyay, Sambuddha Chakrabarti
IN THE HIGH COURT AT CALCUTTA
CIVIL APPELLATE JURISDICTION
APPELLATE SIDE
Present:
The Hon'ble Justice Pranab Kumar Chattopadhyay
AND
The Hon'ble Justice Sambuddha Chakrabarti
F. M. A. 3 of 2012
CAN 2970 of 2012
Indian Oil Corporation Limited
Vs.
The Presiding Officer, Central Government Industrial
Tribunal-cum-Labour Court, Asansol, West Bengal & Ors.
For the Appellant : Mr. Arijit Chaudhury,
Mr. Arunava Ghosh,
Mr. Soumya Majumder,
Mr. Raja Bose,
Mr. Sudhangshu Sil.
For the Respondent Nos 3-7 : Mr. K.B.S. Mahapatra.
For U.O.I. : Mr. Rabindranath Pal.
Heard on : 1.07.2013, 9.07.2013, 16.07.2013 and
19.07.2013.
Judgement on : 08.10.2013
SAMBUDDHA CHAKRABARTI, J.:
The moot question that has cropped up for consideration in this appeal is of great import in the realm of industrial adjudication, if not touching on a larger issue of socio-economic dimension. Much of what is projected and argued as lying at the root of the problem originates from an effort to disown the employment of some workmen who figured as respondents nos. 3 to 7 in this appeal.
In order to appreciate the ramification of the different issues involved in it a brief resume of the facts is necessary. The appellant is a government Company - a public sector undertaking. It claims that the respondents nos. 3 to 7 are not their employees but employees of a contractor who had been engaged by the appellant for providing certain security services at their staff quarters. As a result of the contract between the appellant and the said contractor these workmen were deployed by the contractor.
Earlier the respondent no. 3 filed a writ petition before this Court claiming absorption. The matter was sent back to the appellant for consideration of his representation and the appellant declined to absorb him. Subsequently he moved another writ petition to which the appellant was not a party. That was disposed of by a learned Single Judge of this Court, who is a party to this Bench, directing the Assistant Labour Commissioner (Central) to dispose of the representation of the petitioner.
Subsequently the Assistant Labour Commissioner (Central) initiated a conciliation proceeding of industrial dispute between the respondent no. 3 and the appellant on the regularisation of the former in the services of the appellant. This ended in a failure. Thereafter, the Government of India by an order dated July 8, 2003 referred the dispute for adjudication in exercise of the powers conferred under the Industrial Disputes Act for adjudication to the Central Government Industrial Tribunal- cum-Labour Court, Asansol. The issue was whether the action of the management of the appellant herein, Durgapur Divisional Office, in denying the regularisation of services to Sri K. B. Paul, Gunman and four others (list enclosed) in IOCL is legal and justified. If not, to what relief the workmen are entitled.
Challenging this order of reference the appellant filed a writ petition before this Court with the specific allegation that the five persons named in the said reference were respondents nos. 3 to 7 to the said writ petition and they were all employees of the appellant's contractor Messrs. Lock Jaw I. It was further alleged in the writ petition that those persons who were involved in the dispute as workmen were respondents nos. 3 to 7. The appellant had a total number of 2,229 workmen in the eastern region alone represented by two unions. But none of them or no trade union had espoused the dispute referred to. It was further alleged in the writ petition that the reference was bad as it necessarily raised the question of abolition of contract labour and the Industrial Tribunal could not adjudicate the same. On behalf of the respondents nos. 3 to 7 an affidavit-in- opposition had been filed denying the allegations made in the writ petition. They had claimed that the answering respondents were all appointed in the year 1991 as Licensed Gunman and Security Guards in the appellant corporation and they were posted at their Durgapur staff quarters. They were engaged for the purpose of maintaining security services for years and the job was absolutely perennial in nature. According to them contracts of contract labours are sham or camouflage and he principal employer cannot be relieved of his liability. He retains his control over the means and works to be done by the contractor. According to them, an industrial dispute rightly existed and it was properly referred to the appropriate authority for adjudication.
The very specific point taken by the answering respondents in the affidavit-in-opposition was that the contractors never recruited these respondents as their own staff but only recruited for the purpose of employment in the appellant corporation and these security agencies were merely name lenders and the real employer was the appellant corporation. They have taken yet another point that the disputed relationship of the employer and employee raised factual dispute which can only be resolved by an industrial tribunal and writ court did not have jurisdiction to enter into the disputed question.
A learned single judge of this Court had dismissed this petition holding that whether a person is an employer or not is a disputed question of fact and this cannot be gone into by the writ court. The writ petition was dismissed with the direction upon the respondent no. 1 to take up the issue whether the private respondents were employees of the appellant at the very outset.
This has been the subject-matter of the present appeal. It appears from reading of the judgment and order impugned that the learned trial Judge while dismissing the writ petition on the ground of disputed question of fact had glossed over that the writ petition in fact had really involved issues more fundamental and prominent than relating to facts only. Underlying the whole challenge by the appellant lay the assertion that the dispute raised by the concerned respondents boiled down to abolition of contract labour and an Industrial Tribunal lack jurisdictional competence to gone into it.
Mr. Arijit Chowdhury, the learned senior counsel for the appellant corporation has referred to the failure report of the conciliation proceeding given by the Assistant Labour Commissioner (Central) on February 25, 2003. The dispute was raised by a letter dated July 10, 2002 written by these respondents alleging that the management of the appellant corporation had denied regularisation of the services of those respondents. The failure report recorded:
"The workmen did not produce any
document in support of employer-workmen
relationship between the workmen and the
management of IOCL under Sec. 2(K) but
submitted copies of appointment letter of
Command Security and identity card of
Security Management services."
It appears from the report that these respondents had submitted that they had been working continuously as security guards/ gunmen since 1991 to 1992 through four contractors engaged by the management periodically.
In terms of Section 12(5) of the Industrial Disputes Act if the appropriate government is satisfied on a consideration of the report of the Conciliation Officer that there exists a case for reference it may make such reference. Thus a bare reading of the provision clearly brings out that failure of a conciliation proceeding is the pre-condition for the reference and the appropriate government becomes competent so to do only after the consideration of the failure report as referred to in Section 12(4) of the Industrial Disputes Act. It will be clear from the said letter that the claim was in terms of the Contract Labour Regulation and Abolition Act, 1970. The government had failed to apply its mind to this aspect of the claim.
Mr. Chowdhury has referred to the case of Steel Authority of India Limited -Vs.- Union of India and Others, reported in AIR 2006 SC 3229 for a proposition that neither the Labour Court nor the Writ Court could determine the question as to whether the contract labour should be abolished or not, the same being within the exclusive domain of the appropriate government. From this the appellant submitted that the issue of abolition of contract labour cannot be the subject-matter of an industrial dispute.
The appellant has further submitted that in spite of the fact that the concerned respondents raised a dispute over the abolition of contract labour the same per se was not referred. What was referred in fact was just an incidental issue. The dispute relating to denial of regularisation of service basically originated from, and could not be decided without first deciding, the issue of abolition of contract labour. If the principal issue giving rise to the same cannot be decided by any authority decision on an aspect originating therefrom must be held to be necessarily barred and beyond the scope of the said authority to adjudicate.
There appears to be sufficient substance in the submission made by the appellant that in view of the precise dispute raised by the respondents what was referred to was not an independent dispute but a mere offshoot of the same and as such the appropriate government also was incompetent to form an opinion that this dispute existed independent of a claim for abolition of contract labour.
Secondly, if not more importantly, what the learned single judge could not appreciate was that an Industrial Tribunal could not direct regularisation. Reference may be made to the case of U. P. Power Corporation Limited and Another -Vs.- Bijli Mazdoor Sangh and Others, reported in (2007) 5 SCC 755 where the Supreme Court had held that the foundational logic in the case of Uma Devi [(2006) 4 SCC 1] was based on Article 14 of the Constitution of India. Though an industrial adjudicator can follow the terms of the contract of employment he cannot do anything violative of Article 14 of the Constitution. If the case is one which is covered by the concept of regularisation the same cannot be viewed differently only because it is before an industrial adjudicator.
The appellant also submitted that the concerned respondents were employees of contractors and in support thereof Mr. Chowdhury has taken us through various documents including their written statement before the Industrial Tribunal. From the said written statement it appears that the workmen had specifically claimed in paragraph 2 thereof that they were temporarily absorbed as security guard by Command Security Agency under the Indian Oil Corporation, Durgapur. In the next paragraph we find the reiteration: "since the appointment of your petitioners by the Command Security Agency.........." and the letter of appointment were also issued by the Command Security Agency individually to these workmen. The appointment letters clearly mention that they were temporarily appointed as security guards in the security agency.
It cannot be gainsaid that the documentary evidence including the statements made by the concerned respondents workmen in their written statement evince that the respondents were employed by the respective security agencies. In the case of Workmen of Nilgiri Co-op. Mkt. Society Ltd. - Vs.- State of T.N. and Others, reported in (2004) 3 SCC 514, the Supreme Court had held that employment and non-employment undoubtedly was a matter specified in the second and third schedules to the Industrial Disputes Act. The concept of employment involves three ingredients: 1) employer; 2) employee and 3) contract of employment. On the other hand non- employment being the negative of the expression employment it would ordinarily mean a dispute when the workman is out of service. When non-employment is referable to an employment which at one point of time was existing would be a matter required to be dealt with differently than in a situation where non-employment would mean an contemplated employment. The Supreme Court further held that the question of non- employment in the latter category would arise only when the employer refuses to give work to a person who pleads and proves to the satisfaction of the management that he was entitled thereto. But a dispute regarding the refusal to employ the persons who were promised to be employed is not connected with the employment or non-employment within the meaning of Section 2(K) of the Act.
Referring to the case of Steel Authority of India Limited and Others, etc. etc. -Vs.- National Union Water Front Workers and Others etc., reported in AIR 2001 SC 3527 the appellant argued that the Supreme Court had held that there was no relationship of employer and employee between the principal employer and workmen employed by concerned contractors.
Mr. Mahapatra, the learned Advocate appearing for the private respondents has argued that the engagement of the contractor was a sham one and if the veil is lifted it would be seen that the appellant corporation is the real employer. The respondents had very carefully tried to submit that they were employed through the security agencies for guarding the property and personnel of the appellant corporation and their pay was also fixed by the appellant. The private respondents also relied on the case of Steel Authority of India Limited (Supra). In paragraph 70 of the said judgement the Supreme Court had held that in case whether the contract is a mere camouflage, if the answer is in the affirmative the workmen will be an employee of the principal worker and if the answer is in the negative the workmen will be contract labours. It is not clear how this observation in the said judgement helps the petitioners. The private respondents further claim that the contractors were changed in the meantime but the private respondents were not changed. From this they tried to make out a case that the engagement of the contractor is sham. If they had truly been employed by the contractor they would have also gone with the contractor. All said and done, the fact remains that nothing can supersede the appointment letters issued by the contractors to them. It is all the more so that they were really the employees of those contractors.
Mr. Mahapatra further argued that in view of the observations made by the Supreme Court in paragraph 53 of the case of Secretary, State of Karnataka -Vs.- Uma Devi, reported in (2006) 4 SCC 1 that private respondents were also eligible for regularisation.
This argument must also equally fail as it has already been found that the Industrial Tribunal cannot decide a question relating to claim of regularisation. The respondents further referred to the case of Workmen of Nilgiri Co-op. Mkt. Society Ltd. (Supra) for a proposition that whether a contract is a sham or a camouflage is not a question of law which can be arrived at having regard to the provisions of the Contract Labour Regulation and Abolition Act, 1970. That is left to the industrial adjudicator to decide. The question is not whether the contract was a sham one or camouflage. It is whether the tribunal has the jurisdiction to decide regularisation.
Mr. Mahapatra relied on the case of Workmen employed by Hindustan Liver Limited -Vs.- Hindustan Liver Limited, reported in (1984) 4 SCC 392 for a proposition that a dispute which can be referred for adjudication under Section 10(1) of the Industrial Disputes Act, of necessity has to be an industrial dispute which would be the appropriate government with power to make the reference and the Industrial Tribunal to adjudicate it. The practice of raising frivolous preliminary objections by the employer to delay and defeat by exhausting the workmen should not be allowed, while as a general proposition of law this is true but it cannot be applied to the facts of this case as we are of the view that the objections raised by the appellant are not frivolous or are motivated to delay the process.
The respondents have further referred to the case of Hussainbhai, Calicut -Vs.- The Alath Factory Thezhilali, Union, Kozhikode and Others, reported in FLR 1978 (37 SC) 136 to ascertain the real test of determining the employer employee relationship. It may be mentioned that this case was referred to in Steel Authority of India Limited (Supra) vs. National Union Water Front Workers (Supra), in support of a submission that there existed a relationship of master and servant which was totally rejected by the Supreme Court. The Supreme Court distinguished that case and observed that the contract was sham and nominal. The Supreme Court never held that any contractor employing contract labour for any work would in law create a relationship of master and servant between the establishment and the labour.
Thus we find sufficient merit in the submissions of the appellant and hold that the learned Trial Judge had failed to advert himself to the larger issues involved in the matter and dismissed the writ petition merely on the ground that a disputed question of fact cannot be decided in a writ court. This, we find, it is not the right approach to the case. Therefore, we are unable to affirm the judgement and order under appeal passed by the learned Single Judge and the same is accordingly, set aside. In the aforesaid circumstances, respondents nos. 1 and 2 are restrained from giving any effect to the order of reference and the respondent no. 1, i.e., the Presiding Officer of the Tribunal below is prohibited from entertaining the reference in question dated July 8, 2003.
Thus we find that there is sufficient merit in this appeal and the same stands allowed. With this the application for stay being CAN 2970 of 2012 has become infructuous and the same is also disposed of.
There shall, however, be no order as to costs.
Urgent photostat certified copy of this order, if applied for, be supplied to the parties on priority basis upon compliance of all requisite formalities.
(Sambuddha Chakrabarti, J.) PRANAB KUMAR CHATTOPADHYAY, J.:
I agree.
(Pranab Kumar Chattopadhyay, J.)