Jharkhand High Court
Food Corporation Of India vs The Union Of India on 16 October, 2025
Author: Deepak Roshan
Bench: Deepak Roshan
2025:JHHC:32279
IN THE HIGH COURT OF JHARKHAND AT RANCHI
W.P.(L) No. 4351 of 2023
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Food Corporation of India, a Statutory Corporation constituted by and under the Food Corporation Act, 1964, through Dr. Hemant Kumar Jaishwal, aged 48 years, Son of Shri B. Prasad, the Deputy General Manager (Region), FCI Jharkhand Region, Regional Office, Block-A, 4th Floor, New Collectorate Building, P.S. Kotwali, P.O. & District-Ranchi, PIN 834001(Jharkhand).
.....Petitioner Versus
1. The Union of India.
2. The Secretary, Ministry of Labour, Employment and Training, Government of India, Shram Shakti Bhawan, Rafi Marg, New Delhi, P.O. & P.S. New Delhi, District New Delhi, PIN-110001.
3. The Chief Labour Commissioner (Central), 4th Floor, Jeevandeep Building, Parliament Street, New Delhi, P.O. & P.S. New Delhi, District New Delhi, PIN-110001.
4. The Deputy Chief Labour Commissioner (Central), ShramBhawan, Jagjivan Nagar, P.O. & P.S. Dhanbad, District Dhanbad, PIN-826003 (Jharkhand).
5. Assistant Labour Commissioner (Central), Chaibasa, Flat No. 3/A, 3rd Floor, Shribalajee Apartment, Above Syndicate Bank, Nimdih, P.O. & P.S. Chaibasa, District West Singhbhum, PIN- 833201 (Jharkhand).
6. Sri Hari Kant Sharma, President, Food Corporation of India Shramik Union, C-45, Chandu Nagar, Gali No.5, Near Bihari Masjid, Karawal Nagar Road, New Delhi, P.O. & P.S. New Delhi, District-New Delhi, PIN 110094. ....Respondents
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CORAM: HON'BLE MR. JUSTICE DEEPAK ROSHAN
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For the Petitioner : Mr. Nipun Bakshi, Adv Mr. Shubham Sinha, Adv For the Respondents : Mr. Sachin Kumar, Advocate For the UOI : Mr. Ravi Prakash, CGC
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C.A.V. ON: 15.09.2025 PRONOUNCED ON:-16/10/2025 The instant writ petition has been preferred by the Petitioner-Food Corporation of India for quashing the terms of reference under Section 10(1d) & 2(A) of the Industrial Disputes Act, 1947 in the Notification No. L-22011/20/2022- IR(CN-II) dated 17.10.2022; by which the following dispute 1 2025:JHHC:32279 has been referred for adjudication to the Central Government Industrial Tribunal No. 1 at Dhanbad.
Terms of Reference: -
'Whether the demands of the President FCI Shramik Union, Delhi to the management of FCI, Ranchi, Jharkhand for not to convert the nature of FCI, FSD, Jamshedpur Depot from departmental depot to contractual depot and subsequently apprehension of transfer of all departmental labour gangs alongwith all ancillary labourers of FCI, FSD, Jamshedpur to some other depots is proper, legal and justified? If not, to what relief the union concerned is entitled and from which date?'
2. Ld. Counsel for the Petitioner submits that a Committee was constituted by the Petitioner for assessment of the costs incurred by Food Corporation of India in its Food Storage Depot, Jamshedpur, in comparison with the other two depots being Food Storage Depot, Jasidih and Food Storage Depot, Dhanbad. The Committee after examining the data on evaluation of costs, made its recommendations as follows: -
i. Fourteen (14) gangs of departmental labour are posted at Food Storage Depot, Jamshedpur who are shifted in the following manner:
a. Six (6) full gangs of departmental labour may be shifted to Food Storage Depot, Jasidih.
b. Eight (8) full gangs of departmental labour may be shifted to Food Storage Depot, Dhanbad.
3. The Petitioner also floated a tender for handling work at its Food Storage Depot, Jamshedpur and appointed M/s.
Shyam Trading as the handling contractor for this depot. The Respondent No. 6 - Food Corporation of India Shramik Union protested against substitution of departmental workers of 2 2025:JHHC:32279 Food Storage Depot, Jamshedpur with contract labourers and even threatened strike by issuing a notice of strike dated 14.01.2022.
4. The Petitioner further relies upon a Circular No. 9/2020 dated 10.08.2020 by which Food Corporation of India has been given exemption under Section 31 of the Contract Labour (Regulation and Abolition) Act, 1970 from the provisions of Section 10 of the said Act of 1970. Strong reliance has been placed on paragraph 9 of the writ petition stating that there are only 445 depots having regular labourers comprising Departmental Labour System (DLS), Direct Payment System (DPS) and No Work No Pay labourers (NWNP). The depot at Jamshedpur is also not one of the notified 445 depots and, therefore, there is no legal impediment in employment of contract labour in Food Storage Depot, Jamshedpur.
5. The Assistant Labour Commissioner, Central Chaibasa initiated conciliation proceedings after a notice of strike was given by the Respondent No. 6 - Union. The conciliation ended in failure and the Conciliation Officer submitted his report which led to issuance of a notification for reference which is under challenge in this writ petition. 3
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6. The Petitioner has challenged the first part of the reference which relates to conversion of the nature of Food Storage Depot, Jamshedpur from departmental depot to contractual depot. The second part of the reference is in relation to the transfer of the departmental labour gangs at Jamshedpur Food Storage Depot to some other depot. It has been submitted on behalf of the Petitioner that only an industrial dispute can be referred for adjudication to a Labour Court or Tribunal under Section 10 of the Industrial Disputes Act. The term 'Industrial Dispute' has been defined in Section 2(k) of the Industrial Disputes Act, 1947 to include disputes which are connected with "employment or non- employment or the terms of employment or with the conditions of labour, of any person".
7. It is argued that the first part of the reference does not alter any employment terms except bringing about transfer of all the departmental workers already posted at Food Storage Depot, Jamshedpur to other locations. Transfer of employees is an incidence of service and unless it is mala fide or punitive, it is not to be construed as either a change in condition of service to the detriment of the workmen or in industrial dispute as defined in Section 2(k) of the Industrial Disputes Act, 1947.
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8. It is next submitted that appointment of contractor at the Food Storage Depot, Jamshedpur to cut costs is purely administrative function of Food Corporation of India. None of the regular workers have been removed or their salary reduced or any other change in service was brought by this decision, except their transfer to another location. The manner in which the employer will organize its operations is a purely administrative function and cannot be brought within the purview of industrial dispute.
The definition of industrial disputes is linked to the terms of employment, non-employment of conditions of labour/workmen already working. However, stopping the employer from appointing a contractor for a particular work even when there is no direct adverse consequence on the existing departmental workers cannot be construed to be an industrial dispute which can be referred for adjudication. The only dispute which exists is in relation to transfer of the departmental workers/labourers from Food Storage Depot, Jamshedpur to Food Storage Depot, Jasidih and Food Storage Depot, Dhanbad.
9. The Petitioner further submits that Section 10(1)(d) provides for reference of dispute in relation to any matter 5 2025:JHHC:32279 specified in the Second Schedule or the Third Schedule, to a Tribunal for adjudication.
10. The Second Schedule and Third Schedule to the Industrial Disputes Act does not refer to transfer from service as a dispute specifically and it is further argued that transfer can be treated as a punishment only if it is vindictive or mala fide. In the case of transfer of all the workers there cannot be any claim for mala fide transfer or any selective punitive measure by the Management against some of the workers/labourers.
11. The Petitioner relied upon the case of TISCO Ltd. v. State of Jharkhand,1 in which it has been held by the Hon'ble Supreme Court that a reference must reflect the real dispute between the parties. It was also decided by the Apex Court that the Industrial Tribunal/Labour Court constituted under the Industrial Disputes Act is a creature of that statute and acquires jurisdiction on the basis of reference made to it. The Tribunal has to therefore, confine itself within the scope of the subject matter and cannot travel beyond the same or go behind the reference. For brevity, Paragraphs no. 11 and 12 of this judgement are extracted below:- 1
(2014) 1 SCC 536 6 2025:JHHC:32279
11. Having said so, we are of the opinion that the terms of reference are not appropriately worded inasmuch as these terms of reference do not reflect the real dispute between the parties. The reference presupposes that the respondent workmen are the employees of the appellant. The reference also proceeds on the foundation that their services have been "transferred" to M/s Lafarge. On these suppositions the limited scope of adjudication is confined to decide as to whether the appellant is under an obligation to take back these workmen in service. Obviously, it is not reflective of the real dispute between the parties. It not only depicts the version of the respondent workmen, but in fact accepts the same viz. they are the employees of the appellant and mandates the Labour Court/Industrial Tribunal to only decide as to whether the appellant is required to take them back in its fold. On the contrary, as pointed out above, the case set up by the appellant is that it was not the case of transfer of the workmen to M/s Lafarge but their services were taken over by M/s Lafarge which is a different company/entity altogether. As per the appellant they were issued fresh appointment letters by the new employer and the relationship of employer-employee between the appellant and the workmen stood snapped. This version of the appellant goes to the root of the matter. Not only it is not included in the reference, the appellant's right to put it as its defence, as a demurer, is altogether shut and taken away, in the manner the references are worded.
12. We would hasten to add that, though the jurisdiction of the Tribunal is confined to the terms of reference, but at the same time it is empowered to go into the incidental issues.
Had the reference been appropriately worded, as discussed later in this judgment, probably it was still open to the appellant to contend and prove that the respondent workmen ceased to be their employees. However, the reference in the present form does not leave that scope for the appellant at all.
12. Per Contra, Ld. Counsel for the Respondent No. 6 - Food Corporation of India Shramik Union supports the notification of reference and contended that it was the outcome of a valid conciliation process. The Conciliation Officer has ascertained the real dispute which is not transfer but rationalisation of labour. The Petitioner is substituting departmental labourers with contract workers which is 7 2025:JHHC:32279 clearly an "industrial dispute" as defined in Section 2(k) of the Industrial Disputes Act, 1947.
13. The Respondent's further case is that the Management cannot convert these proceedings into a mini trial of case. While exercising remedy of judicial review, the High Court will only intervene if there is inherent absence of jurisdiction or violation of the principles of natural justice. The Respondent No. 06 relies upon paragraph no. 28 of the decision in Rengali Hydro Electric Project v. Giridhari Sahu, (2019) 10 SCC 6952 which is reproduced below:-
28. On the conspectus of the decisions and material, we would hold as follows: the jurisdiction to issue writ of certiorari is supervisory and not appellate. The Court considering a writ application of certiorari will not don the cap of an appellate court. It will not reappreciate evidence. The writ of certiorari is intended to correct jurisdictional excesses. A writ of prohibition would issue when a tribunal or authority has not yet concluded its proceedings. Once a decision is rendered by a body amenable to certiorari jurisdiction, certiorari could be issued when a jurisdictional error is clearly established. The jurisdictional error may be from failure to observe the limits of its jurisdiction. It may arise from the procedure adopted by the body after validly assuming jurisdiction. It may act in violation of principles of natural justice. The body whose decision which comes under attack may decide a collateral fact which is also a jurisdictional fact and assume jurisdiction. Such a finding of fact is not immune from being interfered with by a writ of certiorari. As far as the finding of fact which is one within the jurisdiction of the court, it is ordinarily a matter "off bounds" for the writ court. This is for the reason that a body which has jurisdiction to decide the matter has the jurisdiction to decide it correctly or wrongly. It would become a mere error and that too an error of fact. However, gross it may amount to, it does not amount to an error of law. An error of law which becomes vulnerable to judicial scrutiny by way of certiorari must also be one which is apparent on the face of the record. As held by this Court in Hari Vishnu Kamath [Hari Vishnu Kamath v. Ahmad Ishaque, AIR 1955 SC 233] , as to what constitutes an error apparent on the face of the record, is a matter to be decided by the court on the facts of each case. A finding of fact which is not supported by any evidence would be perverse and in fact would constitute an error of law enabling the 2 (2014) 1 SCC 536 8 2025:JHHC:32279 writ court to interfere. It is also to be noticed that if the overwhelming weight of the evidence does not support the finding, it would render the decision amenable to certiorari jurisdiction. This would be the same as a finding which is wholly unwarranted by the evidence which is what this Court has laid down (see Parry & Co. Ltd. [Parry & Co. Ltd. v. P.C. Pal, AIR 1970 SC 1334 : (1969) 2 SCR 976] ).
14. It has also been submitted by the contesting Trade Union that the Third Schedule to the Industrial Disputes Act specifically has an entry relating to "rationalization" as a subject matter for industrial dispute. The process of rationalization being conducted by the Petitioner squarely falls within this entry in Third Schedule and there is no illegality in the notification of reference to the Central Government Industrial Tribunal. The Respondent has also drawn attention to a tripartite settlement between the parties and has relied upon the case of Gujarat Electricity Board v. Hind Mazdoor Sabha3 in which the Supreme Court had made observations regarding engagement of contract labour.
15. The Respondents have defended the notification of reference and stated that this writ petition is vexatious. It has been filed by the Petitioner to stall the proceedings before the Central Government Industrial at Dhanbad.
16. Having heard Ld. Counsel for the rival parties; the following issues have arisen for consideration: - 3
1995 2 LLJ 790 9 2025:JHHC:32279 i. Whether the writ petition is maintainable under Article 226 of the Constitution of India?
ii. Whether the terms of reference before the Central Government Industrial Tribunal is based on an industrial dispute within the meaning of Section 2(k) of the Industrial Disputes Act?
iii. Whether transfer of workers from one depot to another is a condition of labour and, therefore a valid subject matter of industrial dispute?
17. As a matter of fact, the maintainability of the writ petition has also been challenged by the Respondents No. 6 on the ground that it is premature and it pre-empts the jurisdiction of the Central Government Industrial Tribunal to answer the question referred to it. It is also the Respondents' case that the validity of the terms of reference cannot be examined in writ jurisdiction as making of reference is purely administrative function which is beyond judicial review.
18. Per Contra the Petitioner has submitted that the validity of reference can only be challenged before this Court and not before the Tribunal.
19. This issue of maintainability of a writ petition challenging the terms of reference under the Industrial Disputes Act, 1947 has been settled in the case of National Engineering Industries Limited v. State of Rajasthan4 4 (2001) SCC 371 10 2025:JHHC:32279 Paragraphs 24 and 27 of decision decide this key issue and are usefully reproduced below: -
"24. It will be thus seen that the High Court has jurisdiction to entertain a writ petition when there is an allegation that there is no industrial dispute and none apprehended which could be the subject-matter of reference for adjudication to the Industrial Tribunal under Section 10 of the Act. Here it is a question of jurisdiction of the Industrial Tribunal, which could be examined by the High Court in its writ jurisdiction. It is the existence of the Industrial Tribunal (sic dispute) which would clothe the appropriate Government with power to make the reference and the Industrial Tribunal to adjudicate it. If there is no industrial dispute in existence or apprehended the appropriate Government lacks power to make any reference. ..."
27. The Industrial Tribunal is the creation of a statute and it gets jurisdiction on the basis of reference. It cannot go into the question on validity of the reference. ...."
20. This Court is having no hesitation in holding that the Labour Court itself being a creature of statute cannot go behind the terms of reference or declare that the terms of reference are illegal or invalid. I therefore, hold that this writ petition is maintainable and this issue is decided accordingly.
21. Now, answering the second and third issues regarding existence of industrial dispute and transfer being one such industrial dispute, it is observed that the first part of the terms of reference relates to converting the nature of depot at Jamshedpur where regular departmental labourers were engaged to contract labour-based depot by appointing a handling contractor.
This Court is of the considered opinion that even though the departmental labourers have not been removed, 11 2025:JHHC:32279 this change has resulted in en masse transfer of all the departmental labour gangs to Dhanbad and Jasidih. This rationalization of labour and the resultant transfer prima facie is an industrial dispute between the parties.
As a settled principle of law; the Writ Court will not enter into the disputed questions of facts and examine the validity of justifiability of the action taken by the employer.
20. There is no quarrel on the point that the appointment of contractor for Food Storage Depot, Jamshedpur is an administrative action, but certainly it causes change in the condition of labourers who were already working at the depot. The change in the condition of labourers was only transfer to some other depot. However, transfer itself can also be an industrial dispute within the meaning of Section 2(k) read with Section 10(1) of the Industrial Disputes Act, 1947.
22. At this juncture, it would be useful to extract the provisions of Section 10(1), Second & Third Schedule of the Industrial Disputes Act and the Schedule II and III: -
"10. Reference of dispute to Boards, Courts or Tribunals.
(1)[Where the appropriate Government is of opinion that any industrial dispute exists or is apprehended, it may at any time] [ Substituted by Act 18 of 1952, S.3, for " If any industrial dispute exits or is apprehended, the appropriate Government may" .], by order in writing-
(a)refer the dispute to a Board for promoting a settlement thereof; or
(b)refer any matter appearing to be connected with or relevant to the dispute to a Court for inquiry; or
(c)[ refer the dispute or any matter appearing to be connected with, or relevant to, the dispute, if it relates to any matter specified in the Second 12 2025:JHHC:32279 Schedule, to a Labour Court for adjudication; or [ Substituted by Act 36 of 1956, Section 7, for Cl. (c) (w.e.f. 10.3.1957).]
(d)refer the dispute or any matter appearing to be connected with, or relevant to, the dispute, whether it relates to any matter specified in the Second Schedule or the Third Schedule, to a Tribunal for adjudication:
Provided that where the dispute relates to any matter specified in the Third Schedule and is not likely to affect more than one hundred workmen, the appropriate Government may, if it so thinks fit, make the reference to a Labour Court under clause (c):] [Provided further that where the dispute relates to a public utility service and a notice under section 22 has been given, the appropriate Government shall, unless it considers that the notice has been frivolously or vexatiously given or that it would be inexpedient so to do, make a reference under this sub- section notwithstanding that any other proceedings under this Act in respect of the dispute may have commenced:] [ Substituted by Act 36 of 1956, Section 7, for " Provided that" (w.e.f. 10.3.1957).] [Provided also that where the dispute in relation to which the Central Government is the appropriate Government, it shall be competent for the Government to refer the dispute to a Labour Court or an Industrial Tribunal, as the case may be, constituted by the State Government.] [ Inserted by Act 46 of 1982, Section 8 (w.e.f. 21.8.1984).]"
"THE SECOND SCHEDULE [See Section 7] MATTERS WITHIN THE JURISDICTION OF LABOUR COURTS
1. The propriety or legality of an order passed by an employer under the standing orders;
2. The application and interpretation of standing orders;
3. Discharge or dismissal of workmen including reinstatement of, or grant of relief to, workmen wrongfully dismissed;
4. Withdrawal of any customary concession or privilege;
5. Illegality or otherwise of a strike or lock-out; and
6. All matters other than those specified in the Third Schedule."
"THE THIRD SCHEDULE MATTERS WITHIN THE JURISDICTION OF INDUSTRIAL TRIBUNALS [See Section 7-A]
1. Wages, including the period and mode of payment;
2. Compensatory and other allowances;
3. Hours of work and rest intervals;
4. Leave with wages and holidays;
5. Bonus, profit sharing, provident fund and gratuity;
6. Shift working otherwise than in accordance with standing orders;
7. Classification by grades;
8. Rules of discipline;
9. Rationalisation;
10. Retrenchment of workmen and closure of establishment; and
11. Any other matter that may be prescribed."
(Emphasis Added)
23. The terms of employment and other conditions of service enumerated in the above two Schedules is not exhaustive and does not restrict an industrial dispute strictly to the matters specified in these two Schedules.
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24. However, rationalization is specifically included in Clause 9 of the Third Schedule read with Section 7A of the Industrial Disputes Act. Moreover, Entry 11 of the same Third Schedule also provides for any other matter that may be prescribed and, therefore, the list is not exhaustive.
25. Section 2(k) of the Industrial Disputes Act, 1947 defines industrial dispute in following terms:
"(k) "industrial dispute" means any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the employment or non-employment or the terms of employment or with the conditions of labour, of any person;"
26. The term industrial dispute is widely worded as it is a beneficial legislation. It has two distinct components namely, "the terms of employment" and "the conditions of labour, of any person". In my assessment the terms of employment include all terms such as wages, increments, promotion, allowances etc. The second limb relates to conditions of labour which includes their physical working conditions also such as safety, security of service etc. The "appropriate government" must refer the real dispute between the parties. The real dispute is not only transfer but rationalisation of workforce which specifically forms part of the statute in the Third Schedule extracted above.
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27. The action of the Management in appointing a contractor at a Food Storage Depot may not be an industrial dispute per se. However, appointment of contractor and consequent transfer of all existing departmental workers to some other depot is replacement of departmental workers with contract workers which qualifies as an industrial dispute. Whether the action is purely administrative and whether the transfer causes prejudice or is otherwise mala fide are questions which are incidental to the main terms of reference and have to be answered by the Central Government Industrial Tribunal to which the dispute is already referred.
28. Having regards to the above discussions, this Court holds that there is a valid industrial dispute and the notification of the terms of reference cannot be quashed. As such, no relief can be granted to the Petitioner.
29. Accordingly, the instant writ petition stands dismissed. Pending I.A. if any also stands disposed of.
(Deepak Roshan, J.) October 16, 2025 Amardeep/-
AFR / NAFR Uploaded on 17/10/2025 15