Calcutta High Court
Damodar Valley Corporation vs Damodar Valley Corporation Canteen ... on 23 July, 2001
Equivalent citations: (2001)3CALLT103(HC)
Author: G.C. Gupta
Bench: Ashok Kumar Mathur, Girish Chandra Gupta
JUDGMENT G.C. Gupta, J.
1. This appeal is directed against an order dated 23-11- 1995 by which a learned single Judge of this Court held that the employees of the Canteen run by the Damodar Valley Corporation Employees Cooperative Stores and Canteen Ltd. (hereinafter referred to as the Co-operative) are to be treated as the employees of the DVC and they should be given the benefit of proper pay scale and other benefits as are admissible to the employees of the DVC. On the basis of the aforesaid findings, the learned single Judge directed the DVC authorities to pay the scale applicable to the employees of non-statutory Canteens as per the directives of the Government of India dated 24-11-1986. Aggrieved by this order the DVC has preferred this appeal.
2. The basic question is whether the employees of the Canteen in question are to be terated to be the employees of DVC. For an answer to this question, the following facts and circumstances of this case may be noticed:
3. There are 20 persons working in the Canteen. The longest in service is alleged to have been employed in the year 1966. Others have entered in the service between the year 1973 and 1992. DVC grants monthly subsidy to Co-operative for meeting establishment costs which includes salary, bonus and diverse allowances payable to the employees as would appear from annexure E to the writ petition and annexure A to the affidavit-in-reply. It also appears from annexure A to the rejoinder that DVC has also sanctioned funds for procurement of corckeries, utensils, refrigerators, furniture and liveries for the Canteen workers.
4. The Canteen in question is situate in Bhabani Bhawan at Calcutta, Bhabani Bhawan houses a large number of offices including the office of DVC. The case of DVC is that the Canteen caters not only to the employees of DVC but also to the employees of the other Government offices which are situate in Bhabani Bhawan. This assertion of DVC has remained uncontroverted.
5. The gist of the case made out by the writ petitioners/respondents is to be found in paragraphs 8 and 9 of the writ petition which is reproduced hereinbelow:
"The petitioners as will appear from annexure A hereof have been working in the said Canteen for a good number of years, but they are subjected to hostile discrimination in the matter of payment of remuneration in comparison to the employees of Inspection Bungalows, Directors' Bungalows which is not only arbitrary but also is a glaring example of colourable exercise of power. In or about 1988 the Canteen employees being compelled formed a Trade Union and got its registration under the, Trade Union Act to protect their interest and against exploitation including to secure their right to receive equal pay for equal work. The authorities of DVC have recognised the petitioner Union and have made correspondences with it in reply to its charter of demand.
The above mentioned canteen run in the Head Office of DVC in Anderson House is an industry and the members of the petitioner No. 1 are the workmen of such industry. Director Personnel or the General Manager of the Corporation as the case may be is the employer. The members of the petitioner No. 1 Union are thus the employees of the DVC and they are entitled to the benefits of same pay scale as are applicable to the employees of Inspection Bungalows, Directors' Bungalows and Guest Houses who have been enjoying regular pay scale and other benefits viz.
provident fund, gratuity, leave salary etc."
6. The case of DVC briefly stated is as follows:
".......the canteen run by co-operative society at Bhabani Bhawan is not a departmental canteen. The employees of the canteen are employed by the said co-operative society, service of such employees controlled and regulated by the members of the co-operative society. DVC management only gives certain financial subsidy to the co-operative society for running the canteen as, assistance on a request made by the Secretary, co-operative society. The day to day management and running of the canteen is wholly controlled and managed by the elected body from amongst the shareholders. As such, it is a non-statutory canteen. The canteen run by the said co-operative society prepares tea, coffee, snacks, etc. for the employees stationed at Bhabani Bhawan. It not only caters the need of the employees of DVC but the employees of the other Governments offices of the West Bengal, which are also situated in Bhabani Bhawan Buildings. DVC has nothing to do with the function of the canteen. It is wholly controlled and managed by the said cooperative society and its Board of Directors.
...............employees working in Inspection Bungalow/Directors Bungalow are appointed by DVC in accordance with Recruitment Rules and their Service condition are guided and regulated by the DVC Staff Regulation while the employees working in the canteen are appointed by the said co-operative society, salaries are paid by the said co-operative society. Conditions of services is regulated by the said co-operative society."
7. The learned single Judge arrived at the following findings:-
"........As we have seen in our present case also the canteen in being run for a very long time, for nearly 30 years or more. The infrastructures for running the canteen, such as, the premises, furniture, electricity, water are supplied by the DVC as stated in paragraph 7 of the affidavit-in-reply. The entire financial burden is also borne by the DVC, steps for modernisation of the canteen at huge expenses are also taken by the DVC. In the facts and circumstances obtaining in this case, it can be visualised that the existence of the co-operative society for running the canteen is nothing but the existence of an intermediary agency of the Corporation and the Corporation for all effective purposes control the running of the canteen which has become a part of the office, an establishment of the DVC as an obligation to provide canteen for the benefit of its employees working there for when it has virtually become a part of their service conditions.
.....
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Since in our present case there are adequate factual materials as discussed earlier, from which it is possible to hold that although the canteen in question is not a statutory canteen, yet the DVC has accepted it as its non-statutory obligation to provide for canteen services to its employees through the canteen in question as a part of its establishment for the benefit of its employees for whom it has virtually become a part of their service conditions. That being so, the recent decision of the Supreme Court in Parimal Chandra Raha v. L.I.C. (AIR 1995 SCW 2609) is applicable to our present case and accordingly relying on the said decision I hold that the employees of the canteen in question are required to be treated as the employees of DVC and they should be given the benefit of proper pay scales and other benefits like retrial benefits, provident fund, etc. as are admissible to the employees of DVC."
8. The finding of the learned trial Judge that the entire, financial burden is borne by DVC is in our view, not borne out by evidence on record, what appears from the record is that monthly subsidy is granted by DVC to the Co-operative for meeting its establishment costs. The finding that "the Corporation for all effective purposes control the running of the Canteen" is in our view without arty evidence whatsoever. On the contrary, admittedly it is the Co-operative who has been controlling affairs of the Canteen. The finding that DVC is under "an obligation to provide Canteen for the benefit of its employees working there for when it has virtually become a part of their service conditions" is not even the case of the writ petitioners. Nowhere it has been alleged far less proved that DVC is under an obligation to provide Canteen for the benefit of its employees or that the benefit of Canteen is a part of service condition of the employees of DVC. The claim in the Writ petition is based on discrimination between the employees of the Canteen and the employees working at the inspection Bungalow etc.
9. The learned single Judge has relied on the case of Parimal Chandra Raha v. Life Insurance Corporation of India, reported in 1995 Suppl. (2) SCC 611 wherein a Division Bench of the Apex Court held that "LIC implicitly accepted the obligation to provide Canteen service,"' on the basis of an agreement dated 15-6-1983 entered into between a contractor and the LIC the preamble whereof reads as follows;
".....whereas the Life Insurance Corporation Of India, Calcutta Divisional Office... is desirous of running a canteen by a contractor on approved terms and conditions at...and whereas the said contractor has accepted the said terms as offered to him... it is hereby declared and agreed as follows........."
10. In the aforesaid case the uncontroverted assertion was that Canteen facility was a condition of service of the employees of the L.I.C. which would be evident from the following passage:
"In the writ petition filed by the appellants, further, it was averred that the employees of the Corporation at all its establishments, are provided with facilities of canteen by the Corporation for more than a few decades and as such the provision of canteen facilities was a condition of service of the employees of the Corporation and that by usage and custom the benefits of canteen facilities had become the conditions of service and that the running of the canteen was incidental to the running of the business of the Corporation. This is not controverted specifically by the Corporation in its reply filed before the Court."
11. It is thus apparent that the facts and circumstances in the Parimal Chandra Raha's case and the facts and circumstances in the present case are different.
12. Reference now can be made to the case of Employers in relation to the Management of Reserve Bank of India v. Workmen, where Their Lordships were considering a case of three types of Canteens (a) Canteens run by Implementation Committee (b) Canteen run by co-operative societies; and (c) Canteens run through contractor. In the case of the Canteen run through the Implementation Committee, the Bank was making grants by way of subsidy at 95 per cent of the costs Incurred by the Canteens for payment of salary, provident fund contribution, gratuity, uniform etc. besides providing fuel, water, fixtures, utensils, furniture, electricity, premises etc. free of charge. In the Committee, it was found that there were three representatives from the Bank namely the currency officer, personnel officer and the officer from the personnel policy department. The currency officer was the Chairman of the Canteen Committee. The Committee could not increase the strength of the Canteen employees without the permission of the Bank. The rates of eatables could not be revised without the consent of the Manager, the committee could not effect any wage revision without the approval of the Bank. The Bank was also reimbursing the expenses incurred over the periodical medical check up of the employees attached to the kitchen and counters. As against these facts it was established that the recruitment of the workers of the Canteen was made by the Canteen committee, the attendance record as well as the sanctioning of leave to the workers was done by the committee. The only role played by the Bank in running of the Canteen was the nomination of three members to the committee. There was no right in the Bank to supervise and control the work done by the persons employed by the committee nor did the Bank have any right to direct the manner in which the work shall be done. The Bank had absolutely no right to take any disciplinary action or to, direct any Canteen employee to do a particular work in such a case Their Lordships declined to hold that the employees of the concerned Canteen were to be treated as the employees of the Bank. Their Lordships in the aforesaid case held as follows:
"We are of the view that in the absence of any obligation, statutory or otherwise, regarding the running of a canteen by the Bank and the details relating thereto similar to Factories Act or the Railway Establishment Manual, and in the absence, of any effective op direct control in the Bank to supervise and control the work done by various persons, the workers in the canteen run by the Implementation Committee (Canteen Committee) cannot come within the ratio laid down by this Court in M.M.R. Khan case."
13. In M.M.R. Khan and others v. Union of India and others, reported in 1990 (suppl.) SCC 191 Their Lordships while considering the question of the employees working in non-statutory recognised Canteens held as follows:
".....In the first instance, there is hardly any difference between the statutory canteens and non-statutory recognised canteens. The statutory canteens are established wherever the railway establishments employ more than 250 persons as is mandatory under the provisions of section 46 of the Act while non-statutory canteens are required to fee established under paragraph 2831 of the Railway Establishment Manual where the strength of the staff is 100 or more. In terms of the said paragraph, the non-statutory canteens, to be recognised have to be approved of by the Railway Board in advance. Every railway administration seeking to set up such, canteens is required, to approach the Railway Board for their prior approval/recognition, indicating financial implications involved duly vetted by the Financial Adviser and Chief Accounts Officer of the railway concerned. It is only when the approval is accorded by the Railway Board that, the canteen is, treated as a recognised non-statutory canteen. By the sanction, the details in regard to the number of staff to be employed in the canteen, recurring and non-recurring expenditure etc. are regulated. The only material difference between the statutory canteen and non-statutory recognised canteen is that while one is obligatory under the said Act the other is not. However, there is no difference in the management of the two types of canteens as is evident from the provisions of paragraphs 2832 and 2833 which respectively provide for their management. Regarding the incidence of cost to be borne by the railways again, as far as the Manual is concerned, the only additional obligation cast on the administration, in the case of the statutory canteens is that in addition to the facilities given to the non-statutory canteens, the administration has also to meet the statutory obligations in respect of the expenditure for providing and maintaining canteens arising from the said Act and the rules framed thereunder. A perusal of the relevant provisions shows that the said Act and the rules made thereunder do not make demands on the administration for more expenditure than what is provided for in the Railway Manual for the non-statutory canteens. We have already referred to the service conditions applicable to the employees of the statutory and non-statutory canteens. Besides, while discussing the case of the employees in statutory and non-statutory canteens we have pointed out the relevant provisions of the Administrative Instructions on Departmental Canteens in Government Offices and Government Industrial Establishments. These Instructions are applicable to both statutory and non-statutory recognised canteens. The Instructions do not make any difference between the two so far as their applicability is concerned. In fact these Instructions require that the canteen run by engaging solely part time daily wage workers may be converted to departmental canteens. Hence we do not see why any distinction be made between the employees of the two types of canteens so far as their service conditions are concerned. For this very reason, the two notification of December 11, 1979 and December 23, 1960 (supra) should also be equally applicable to the employees of these canteen. If this is so, then these employees would also be entitled to be treated as railway Servants. A classification made between the employees of the two, types of canteens would be unreasonable and will have no rational nexus with the purpose of the classification. Surely it cannot be argued that the employees who otherwise do the same work and work under the same conditions and under a similar management have to be treated differently merely because, the canteen happens to be run at an establishment which employs 250 or less than 250 members of the staff. The smaller strength of the staff may justify a smaller number of the canteen workers to serve them. But that does not make any difference to the working conditions of such workers."
14. In the case of Indian Overseas Bank v. I.O.B. Staff Canteen Workers' Union and another, , on, the basis of a fetter written by the Bank. Court came to a definite finding that the Bank had an obligation to run the Canteen. The said letter and the finding of the Apex Court is reproduced hereinbelow:
"All members are requested to avail this facility and refrain from going out for coffee and tea. Since the canteen has started functioning the Department Heads should inform all the staff members to restrict their lunch time to half an hour between 2:30 and 3.00 p.m. and the staff may be permitted to go for lunch in fixed time to avoid rush at the canteen......
The above passage quoted from the letter of the Central Office of the Bank amply established that the Bank had an obligation to run the canteen and in fact, was running the canteen, through contractors, even though the promoters had withdrawn their service. Actually, it appears that the promoters were desirous of forming a cooperative society and it did not fructify. In this view of the matter. It is clear that as in LIC case the Bank had been running the canteen by one or other of the agency."
15. Therefore, this case does not help the writ petitioners/respondents.
16. Reference may next be made to the case of State Bank of India v. State Bank of India Canteen Employees' Union and others, where employees of the Canteen were not held to be the employees of the Bank following the Reserve Bank of India's case. Their Lordships held in the aforesaid case as follows:
"Further, we entirely agree with decision rendered in RBI case by the three-Judge Bench and the facts in the present case are similar to the facts of that case. Presuming that the privilege of providing canteen facilities to the employees exists, yet it would be difficult to hold that the Bank should provide the said facility by running a canteen by itself.
To promote canteen facilities by providing subsidy or other facilities is altogether different from running the canteen."
17. Applying the ratio of the aforesaid cases to the facts and circumstances of the case in hand we are unable to sustain the finding of the learned single Judge for the following additional reasons:
(a) It is nobody's case that DVC is under any obligation statutory or otherwise to provide Canteen service to its employees.
(b) Grant of subsidy is not enough to hold that it is so done in discharge of any obligation of DVC to provide Canteen service.
(c) At the highest, on the basis of the evidence, it can be said that DVC has undertaken the obligation to provide facilities to run a canteen which is not the same thing as to say that DVC is under an obligation to provide a Canteen. As a matter of fact this distinction was made in the Parimal Chandra Raha's case itself where Their Lordships held "the obligation to provide a canteen has to be distinguished from the obligation to provide facilities to run the Canteen. The Canteen run pursuant to the latter obligation does not become a part of the establishment"
(d) There is nothing on record to show that the services of the employees of the Canteen are regulated by DVC or that DVC supervises or controls the work done by the members of the writ petitioner.
(e) The Canteen in this case does not only cater to the employees of DVC. It also caters to the large number of employees working in different offices situate at Bhabani Bhawan in the city of Calcutta.
For the reasons aforesaid we are unable on the basis of the available material to hold that the employees, of the Canteen are to be treated as employees of DVC.
We, however, make it clear that it would be open to the writ petitioners, if they are so advised, to approach the appropriate authority, upon adequate materials, for a reference as an industrial dispute under section 10(1)(d) of the Industrial Disputes Act.
Accordingly, the appeal succeeds. The order passed by the learned single Judge is set aside. There shall however be no order as to costs.
A.K. Mathur, C.J.
I agree.
18. Appeal succeeds