Allahabad High Court
Superintending Engineer, Faizabad ... vs Presiding Officer, Labour Court, U.P., ... on 4 March, 2020
Equivalent citations: AIRONLINE 2020 ALL 276
Author: Sangeeta Chandra
Bench: Sangeeta Chandra
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH AFR Reserved on: 18.09.2019 Delivered on: 04.03.2020 Case :- MISC. SINGLE No. - 6548 of 2010 Petitioner :- Superintending Engineer, Faizabad Circle & Ors. Respondent :- Presiding Officer, Labour Court, U.P., Faizabad & Ors. Counsel for Petitioner :- Standing Counsel Counsel for Respondent :- C.S.C.,Kailesh Nath Tewari,Y.S. Lohit CONNECTED WITH: Case :- MISC. SINGLE No. - 4074 of 2010 Petitioner :- State Of U.P.Through The Prin. Secy. P.W.D. Lko.And Ors. Respondent :- Vijay Bahadur Sharma And Another Counsel for Petitioner :- C.S.C. Counsel for Respondent :- Nand Kishore,Avadhesh Kumar Singh,Krishna Mohan,Nand Kishore,Yadukul Shiromani Srivast Hon'ble Mrs. Sangeeta Chandra,J.
1. Heard learned counsel for the petitioners and learned counsel for the respondents.
2. These writ petitions have been taken up together by this Court as they relate to the question whether an Industrial Adjudication case could have been entertained by the Labour Court on reference being made to it regarding daily wage workmen engaged by the Public Works Department on muster roll and whether the Public Works Department of the State of U.P. can be considered to be an industry under the Industrial Disputes Act.
3. The facts, in brief, of each of these writ petitions are being stated here in below.
4. Writ Petition No.6548 (MS) of 2010 challenges an order passed by the respondent no.1 dated 29.1.2009 in Adjudication Case No.16 of 1998 (Krishna Prasad versus Superintending Engineer, Faizabad Circle, Faizabad and others) whereby the respondent no.1 has issued directions that respondent no.3 shall be entitled to reinstatement and all service benefits. In this petition, Krishna Prasad was initially engaged as a Beldar on daily wage basis in 1981 and disengaged after November, 1989. After seven years of such disengagement, he approached the Deputy Labour Commissioner, Faizabad Region, Faizabad under Section 2(A) of the Industrial Disputes Act (for short ''the Act') on 15.6.1996. The conciliation attempt having failed, the Deputy Labour Commissioner referred the matter to the respondent no.1, which was registered as Adjudication Case No.16 of 1998. After the written statement was filed by Krishna Prasad, the petitioners also filed a written statement, in which, they specifically disputed the applicability of the Industrial Disputes Act to Public Works Department of the State of U.P.. It was submitted that the engagement of daily wage workers takes place for carrying out work assigned by the Government of U.P. under the provisions of Paragraph 429 and 430 of Part-I, Volume-VI of the Financial Handbook and Muster Roll is maintained and wages are paid at the prescribed rates under the Minimum Wages Act. The daily wage workers are engaged to meet the exigencies of work and as per availability of budget and since there was no work available, the respondent no.3 was disengaged in 1989.
5. This Court has perused the written statement filed by the employers in which, in paragraph 1 and 2, it was clearly stated that the Industrial Disputes Act, 1947 does not apply to the Public Works Department of State of U.P. The workers are engaged on the basis of Paragraphs 429 and 430 of the Financial Handbook, Volume-VI and payment is charged to the works under paragraph 667 of the Financial Handbook.
6. The respondent No.1 did not consider the preliminary objection raised regarding maintainability of the adjudication case first, but went on with the adjudication of the case on the basis of written statement and oral evidence of the respondent no.3 that he had worked w.e.f. 15.12.1981 upto 15.7.1989 continuously and that his name appeared at Serial No.182 in the seniority list of 270 workmen maintained by the establishment. No notice was given to him nor any retrenchment compensation was given before his disengagement on 15.7.1989. Since after the filing of the written statement by the employer, no attempt was made to appear before the respondent no.1 for cross examination of the workman despite several opportunities being given to them, the respondent no.1 relied upon evidence produced by the workmen to come to a conclusion that the respondent no.3 had been disengaged on 15.7.1989 in violation of section 6N of the Act. A direction was issued for his reinstatement and consequential benefits to be given to him in the Award dated 29.1.2009.
7. It appears that no interim order was granted by this Court in this writ petition and the workman was reinstated by the petitioners subject to final orders being passed by this Court. The Office Memorandum dated 7.5.2012 putting back the respondent no.3 into service on daily wage basis at the rate of Rs.100/- per day has been brought on record by the respondent no.3 by filing an application on 4.9.2017.
8. In Writ Petition No.4074 (MS) of 2010, the petitioners have challenged the award dated 10.11.2009 passed in Adjudication Case No.12 of 2002.
9. In the said writ petition, the case of the petitioners is that the respondent no.1 was engaged as daily wage labourer on 1.12.1984 and was disengaged in November, 1986. The respondent no.1 raised an industrial dispute before the Assistant Labour Commissioner, Faizabad in 2001 and after failure of conciliation proceedings, the matter was referred to the Labour Court for adjudication on 25.12.2002. The written statement was filed by the petitioners wherein, they stated clearly in Paragraph 1 and 6 that the Industrial Disputes Act does not apply to the Public Works Department of the State of U.P. which is a Government department where engagement of labourers is done as per Paragraph 429 and 430 of the Financial Handbook Volume-VI and that the Public Works Department being a Department of the Government of U.P. carries out work assigned to it on a cost to cost basis without any profit or loss.
The Labour Court however did not think it appropriate to decide the preliminary objection raised by the employer as to the maintainability of the adjudication case, but went on to decide the matter on the basis of evidence led both oral and documentary by the respondent no.1 and came to the conclusion that the respondent no.1 had been retrenched without following the procedure prescribed under Section 6N of the Act and was entitled for reinstatement. However, because of passage of time, full back wages were not given by the Labour Court, Faizabad, but a direction was issued for payment of 20% of the back-wages only.
10. This Court at the time of hearing the writ petition as fresh, did not pass any interim order. Several applications for grant of interim relief were filed as execution case had been initiated by the respondent no.1. When these applications were not taken up, the petitioners reinstated the respondent no.1 on 15.4.2015 as daily wage Beldar. The respondent no.1 moved an application for modification of the award by this Court and dismissal of the writ petition with the direction that the respondent no.1 be engaged as chowkidar as in the oral evidence filed by the employer's witness before the Labour Court, it had come out that the respondent no.1 was lastly engaged as chowkidar. In the absence of any interim order, the Deputy Labour Commissioner continued with the execution proceedings with regard to the back wages as granted by the Labour Court in the Award and attachment of the properties in the office of the Executive Engineer took place, as a result whereof, more than one lakh rupees was deposited before the Labour Court and an application bearing C.M. Application No.71364 of 2010 was moved before this Court. This Court by an order dated 8.9.2015 directed the Deputy Labour Commissioner to release the property, which had been attached, if the due amount had been deposited by the petitioners, but the amount so deposited by the petitioners would not be released in favour of the respondent no.1, although he may be allowed to continue in service in terms of the Award.
11. From the order sheet, it is evident that respondent no.1 died on 19.3.2017 and a substitution application was moved by his widow Mrs. Durgawati along with his son and daughter, who are both minors. This Court allowed the substitution application by its order dated 6.9.2017.
12. During the course of argument in these two writ petitions, learned counsel for the respondents Mr. Y.S. Lohit has relied upon several judgments of this Court and of the Supreme Court to submit that these writ petitions be dismissed.
13. This Court has perused the judgments cited by both learned counsel for the petitioners and the learned counsel for the respondents. No doubt, in Writ Petition No.4382 (SS) of 2001: State of U.P. and others vs. Harish Chandra, decided on 31.7.2015, this Court had dismissed a similar petition filed by the Irrigation Department, placing reliance upon the observations made by the Supreme Court in State of Maharashtra and another versus Sarva Shramik Sangh, Sangli and others, 2013 (16) SSC 16, wherein it was observed that the mere fact that correctness of the decision in the case of Bangalore Water Supply and Sewerage Board vs. A. Rajappa (1978) 2 SCC 213 had been referred to a larger bench in State of U.P. versus Jai Bir Singh, (2005) 5 SCC 1, will not come in the way of the Court in following the existing law now covered by the seven Judges Constitution Bench judgment in Bangalore water supply case (supra), which is presently holding the field. Similarly, a coordinate Bench of this Court in Writ Petition No.6910 (MS) of 2002: Superintending Engineer Provincial Division P.W.D. Barabanki versus Presiding Officer, Labour Court, Lucknow has dismissed the writ petition on 20.3.2017 by observing that the judgment rendered by the Supreme Court in Bangalore water supply case (supra) has been followed in two coordinate Bench decisions in Sant Kumar Dubey versus Presiding Officer, Industrial Tribunal (IV), Uttar Pradesh, Agra and others: 1997 Labour and Industrial Cases 777 and in State of U.P. and others vs. Deep Chandra and others (2004) 1 UPLBEC 816, wherein it has been held that the Public Works Department of the Government of U.P. is an industry and covered by the U.P. Industrial Disputes Act as the petitioners therein had not taken the trouble to file any written statement before the Presiding Officer, Labour Court and there was no question of showing any interference in the Award.
14. This Court, however, having gone through the written statement filed by the writ petitioners herein in both the adjudication cases before the Labour Court, finds that a preliminary objection was raised regarding maintainability of the adjudication case before the Labour Court under the Industrial Disputes Act, 1947, yet the preliminary objection was ignored and orders were passed in favour of the private respondents only on the basis of oral and documentary evidence led by the workmen.
15. In Union of India and others versus Ranbir Singh Rathore and others (2006) 11 SCC 696, the Supreme Court had observed thus:-
"42. .........In any event we feel that the High Court's approach is clearly erroneous. The present appellants in the counter-affidavit filed had raised a preliminary objection as regards the maintainability of the writ petitions and had requested the High Court to grant further opportunity if the necessity so arises to file a detailed counter-affidavit after the preliminary objections were decided. The High Court in fact in one of the orders clearly indicated that the preliminary objections were to be decided first. But strangely it did not do so."
16. In National Highways Authority of India versus Ganga Enterprises and another, (2003) 7 SCC 410, the Supreme Court in Paragraph-6 observed thus:-
"6. The respondent then filed a writ petition in the High Court for refund of the amount. On the pleadings before it, the High Court raised two questions viz.: (a) whether the forfeiture of security deposit is without authority of law and without any binding contract between the parties and also contrary to Section 5 of the Contract Act; and (b) whether the writ petition is maintainable in a claim arising out of a breach of contract. Question (b) should have been first answered as it would go to the root of the matter. The High Court instead considered Question (a) and then chose not to answer Question (b). In our view, the answer to Question (b) is clear. It is settled law that disputes relating to contracts cannot be agitated under Article 226 of the Constitution of India. It has been so held in the cases of Kerala SEB v. Kurien E. Kalathil [(2000) 6 SCC 293] , State of U.P. v. Bridge & Roof Co. (India) Ltd. [(1996) 6 SCC 22] and Bareilly Development Authority v. Ajai Pal Singh [(1989) 2 SCC 116] . This is settled law. The dispute in this case was regarding the terms of offer. They were thus contractual disputes in respect of which a writ court was not the proper forum. Mr Dave, however, relied upon the cases of Verigamto Naveen v. Govt. of A.P. [(2001) 8 SCC 344] and Harminder Singh Arora v. Union of India [(1986) 3 SCC 247]. These, however, are cases where the writ court was enforcing a statutory right or duty. These cases do not lay down that a writ court can interfere in a matter of contract only. Thus on the ground of maintainability the petition should have been dismissed."
17. Regarding the validity or otherwise of the preliminary objection raised by the petitioners, this Court has gone through the judgment in Bangalore Water Supply case (supra) carefully. While considering what constitutes the expression ''industry' after critically examining the previous decisions, Justice Krishna Iyer, who delivered the main judgment i.e. opinion on his behalf and on behalf of two other Judges, has observed in Para-139 to 143 as follows:
""139. ... So we proceed to formulate the principles, deducible from our discussion, which are decisive, positively and negatively, of the identity of ''industry' under the Act. We speak, not exhaustively, but to the extent covered by the debate at the Bar and, to that extent, authoritatively, until overruled by a larger Bench or superseded by the legislative branch.
I
140. ''Industry', as defined in Section 2(j) and explained in Banerji [D.N. Banerji v. P.R. Mukherjee, 1953 SCR 302 : AIR 1953 SC 58] has a wide import.
(a) Where (i) systematic activity, (ii) organised by cooperation between employer and employee (the direct and substantial element is chimerical) (iii) for the production and/or distribution of goods and services calculated to satisfy human wants and wishes (not spiritual or religious but inclusive of material things or services geared to celestial bliss i.e. making, on a large scale prasad or food), prima facie, there is an ''industry' in that enterprise.
(b) Absence of profit motive or gainful objective is irrelevant, be the venture in the public, joint, private or other sector.
(c) The true focus is functional and the decisive test is the nature of the activity with special emphasis on employer-employee relations.
(d) If the organisation is a trade or business it does not cease to be one because of philanthropy animating the undertaking.
II
141. Although Section 2(j) uses words of the widest amplitude in its two limbs, their meaning cannot be magnified to overreach itself.
(a) ''Undertaking' must suffer a contextual and associational shrinkage as explained in Banerji [D.N. Banerji v. P.R. Mukherjee, 1953 SCR 302 : AIR 1953 SC 58] and in this judgment; so also, service, calling and the like. This yields the inference that all organised activity possessing the triple elements in I (supra), although not trade or business, may still be ''industry' provided the nature of the activity (emphasis in original) viz. the employer-employee basis, bears resemblance to what we find in trade or business. This takes into the fold of ''industry' undertakings, callings and services, adventures ''analogous to the carrying (emphasis in original) on the trade or business'. All features, other than the methodology of carrying on the activity viz. in organising the cooperation between employer and employee, may be dissimilar. It does not matter, if on the employment terms there is analogy.
III
142. Application of these guidelines should not stop short of their logical reach by invocation of creeds, cults or inner sense of incongruity or outer sense of motivation for or resultant of the economic operations. The ideology of the Act being industrial peace, regulation and resolution of industrial disputes between employer and workmen, the range of this statutory ideology must inform the reach of the statutory definition. Nothing less, nothing more.
(a) The consequences are (i) professions, (ii) clubs, (iii) educational institutions, (iv) cooperatives, (v) research institutes, (vi) charitable projects, and (vii) other kindred adventures, if they fulfil the triple tests listed in I (supra), cannot be exempted from the scope of Section 2(j).
(b) A restricted category of professions, clubs, cooperatives and even gurukulas and little research labs, may qualify for exemption if, in simple ventures, substantially and, going by the dominant nature criterion, substantively, no employees are entertained but in minimal matters, marginal employees are hired without destroying the non-employee character of the unit.
(c) If, in a pious or altruistic mission many employ themselves, free or for small honoraria or like return, mainly drawn by sharing in the purpose or cause, such as lawyers volunteering to run a free legal services clinic or doctors serving in their spare hours in a free medical centre or ashramites working at the bidding of the holiness, divinity or like central personality, and the services are supplied free or at nominal cost and those who serve are not engaged for remuneration or on the basis of master and servant relationship, then, the institution is not an industry even if stray servants, manual or technical, are hired. Such eleemosynary or like undertakings alone are exempt -- not other generosity, compassion, developmental passion or project.
IV
143. The dominant nature test:
(a) Where a complex of activities, some of which qualify for exemption, others not, involves employees on the total undertaking, some of whom are not ''workmen' as in University of Delhi case [University of Delhi v. Ram Nath, (1964) 2 SCR 703 : AIR 1963 SC 1873] or some departments are not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the departments as explained in Corpn. of Nagpur [ Corpn. of the City of Nagpur v. Employees, (1960) 2 SCR 942 : AIR 1960 SC 675] will be the true test. The whole undertaking will be ''industry' although those who are not ''workmen' by definition may not benefit by the status.
(b) Notwithstanding the previous clauses, sovereign functions, strictly understood, (alone) qualify for exemption, not the welfare activities or economic adventures undertaken by Government or statutory bodies.
(c) Even in departments discharging sovereign functions, if there are units which are industries and they are substantially severable, then they can be considered to come within Section 2(j).
(d) Constitutional and competently enacted legislative provisions may well remove from the scope of the Act categories which otherwise may be covered thereby." (Emphasis supplied)
18. It is undisputed that muster roll employees are engaged by the Department of Irrigation and Public Works and other such Departments which carry out welfare activities relating to infrastructure etc. on behalf of the State Government in terms of Paragraph 429 and 430 of Volume-VI Part-I of Financial Handbook.
19. The Financial Handbook is a set of fundamental rules which govern the administration of not only Central Government but also the State Government. Volume-VI of the Financial Handbook deals with several matters including the matters relating to how contracts are to be signed with regard to construction work and how construction work itself is to be carried out by such Departments as the Department of Irrigation and Public Works.
20. The muster roll employees having been engaged under Paragraph 429 and 430, and work charge employees being engaged under Paragraph 630 of the Financial Handbook, are governed by the statutory provisions as given in the Financial Handbook with regard to their engagement and monitory benefits admissible to them on such engagement.
21. The Financial Handbook containing Fundamental Rules are in the nature of ''law' as defined in Article 13 of the Constitution of India and they carry statutory force.
22. Since in the judgment rendered in Bangalore Water Supply case (supra), the majority opinion excluded Government departments which may otherwise be covered by the expansive definition of ''industry' given in Paragraph 140 to 143, if there are constitutionally and competently enacted legislative provisions, governing such activities as undertaken by such Departments; the Public Works Department stands excluded from the expansive definition of ''industry' as given by the Bangalore Water Supply and Sewerage Board case (supra).
23. Having perused the Awards impugned passed by the Labour Courts in these two writ petitions, the Court finds no mention at all or consideration of the preliminary objection raised with regard to the maintainability of the Adjudication case under the U.P. Industrial Disputes Act by the Labour Court concerned.
24. The Awards dated 29.1.2009 and 10.11.2009 are set aside. However, since the respondents have been engaged in the absence of any interim order as daily wage Beldars, the benefit granted to them by the authorities during the pendency of these writ petitions shall not be taken away from them. The amount of back wages deposited by the petitioners in Writ Petition No.4074 (MS) of 2010 before the Labour Court, shall be refunded to them on an appropriate application being moved by them.
25. The writ petitions stand allowed to this extent.
Dated: March 4th, 2020 Sachin