Madhya Pradesh High Court
Ceo Eris Life Sciences Ltd. vs The State Of Madhya Pradesh on 30 July, 2024
Author: Milind Ramesh Phadke
Bench: Milind Ramesh Phadke
1
IN THE HIGH COURT OF MADHYA PRADESH
AT G WA L I O R
BEFORE
HON'BLE SHRI JUSTICE MILIND RAMESH PHADKE
ON THE 30th OF JULY, 2024
WRIT PETITION No. 25065 of 2019
(CEO ERIS LIFE SCIENCES LTD.
Vs
THE STATE OF MADHYA PRADESH AND OTHERS)
Appearance:
(BY SHRI N.K. GUPTA - LEARNED SENIOR ADVOCATE WITH SHRI
Y.P.S. RATHORE AND SHRI BHAGWAN SINGH BAIS - ADVOCATE FOR
PETITIONER)
(BY SHRI HARESH KUMAR PARDASANI - ADVOCATE FOR
RESPONDENT NO.4)
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ORDER
The present writ petition under Article 226 of the Constitution of India is preferred against the reference order dated 01.08.2017 passed by respondent No.2 in file No.77/7/III/2017/28144-50, whereby respondent No.2 has referred an industrial dispute for adjudication to the Labour Court No.1, Gwalior, whereas at the time of termination, the respondent No.4 was working as Regional Business Manager at Indore and was not covered under the definition of 'workman' and looking to the admitted facts, respondent No.4 since did not fall within the category of workman as defined in the Industrial Disputes Act, hence, the respondent No.2 was having no jurisdiction to refer the dispute for adjudication to the Labour Court and the learned Labour Court, Gwalior was having no jurisdiction to adjudicate the present reference.
2. The facts relating to the controversy are that the petitioner Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 2 Company is a pharmaceutical industry and is engaged in manufacturing and sales of the medicines. The respondent no.4 was appointed as Regional Business Manager at Indore by the petitioner vide appointment letter dated 10.04.2014. Since respondent No.4 committed certain gross misconduct, therefore, his services were terminated vide letter dated 28.01.2016. Thereupon, respondent No.4 raised Industrial Dispute against his termination by filing an application under Section 2(A) and 10 of Industrial Disputes Act before Assistant Labour Commissioner cum Conciliation Officer, Gwalior wherein he clearly stated in Para 2 of the application that though he was appointed as Regional Business Manager but infact he was working as Sales Promotion Employee. The petitioner filed reply on 24.08.2016 to the application filed by the respondent No.4 wherein it was stated that looking to the admissions of the respondent No.4 that though he was posted as Regional Business Manager but he was working as Medical Sales Representative (Sales Promotion Employee), hence he had no right to raise the Industrial Dispute, therefore, his application be rejected forthwith.
3. Despite the said legal and jurisdictional objections, the respondent no. 2 & 3 had referred the dispute to the Labour Court no. 1 Gwalior for adjudication vide reference order dated 01.08.2017 and in pursuance thereof the respondent no. 4 filed statement of claim under section 2(A) and 10 of the Industrial Disputes Act before the Labour Court no.1, Gwalior and alleged therein that he was working since 10.03.2014 as Regional Business Manager with the petitioner at Indore as his Head Quarter, but infact he was working as Sales Promotion Employee nomenclatured as Regional Business Manger and his services were illegally terminated so he be Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 3 reinstated with back-wages. The petitioner had filed reply of the Statement of Claim before the Labour Court and had stated that looking to his admissions, he does not fall within the category of workman, hence, the reference made by Respondent no. 2 & 3 is bad in law and the Labour Court has no jurisdiction to entertain the statement of claim filed by the respondent no. 4. Thus, assailing the order of reference, the present petition has been filed.
4. Learned Senior Counsel Shri N.K. Gupta alongwith Shri Y.P.S. Rathore, learned counsel for petitioner submitted that the order of reference Annexure P/1 is against the settled principles of law and is suffering from gross illegality, hence, deserve to be quashed.
5. It was further submitted that when the Respondent no. 4 himself has stated in his application preferred before Labour Court while raising Industrial dispute that he was appointed by the petitioner as Regional Business Manager since 10.03.2014 and on the said position, he was required to promote the Sales of the company's products for which he was required to meet with various doctors and medical stores, merchants and also various clients which impliedly shows that he was not working in the clerical, technical, operational and other categories as defined in Sec. 2(s)of the Industrial Disputes Act, 1947, hence, when on his own admissions, the Respondent no. 4 was not falling within the category of workman as defined in the Act, therefore, the order of reference was bad in law.
6. It was further submitted that, it is an admitted fact that respondent no. 4 was engaged as Regional Business Manager in the petitioner company which is a pharmaceutical Company and the Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 4 respondent no. 4 himself has admitted in para 3 of statement of claim that his primary duty was to visit doctors, chemist as well as stockiest, meeting different professional to promote sales of product of the petitioner company and the said duties discharged by the employee cannot be said to be manual or clerical as it requires knowledge of products and for that the employee uses the persuasive skills and though the petitioner may not be controlling any subordinate staff but he was master of work assigned to him.
7. In support of his contentions, learned Senior Counsel has placed reliance on the decision rendered in the case of Norvatis India Ltd. Vs. Vipin Shrivastava reported in 2019 (161) FLR 574 wherein the Division Bench of this Court while dealing with the issue as to whether the Medical Representative as a "workman" within the meaning of Section 2(s) of the Industrial Disputes Act, 1947 was competent to raise a dispute before the Labour Court, the Division Bench after scrutinizing the various provisions had concluded that the Medical Representative is not a workman within the meaning of Section 2 (s) of the Industrial Disputes Act and section 2 (d) of the Sales Promotion Employees (Conditions of Service) Act, 1976. Further elaborating learned Senior Counsel submitted that the question as to whether a person is a workman within the meaning of Section 2(s) of the Industrial Disputes Act, 1947 mainly depends upon the nature of the industry, type of work in which he is engaged, organizational set up of particular unit of industry and other factors and with regard to Sales Representative in a Pharmaceutical Company, his primary duty is to visit doctors, chemists as well as stockists and meeting different professionals to promote sale of product of the company and cannot be said to be Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 5 manual or clerical work as it requires knowledge of product, its uses and also persuasive skills and the interest of the management is that the Medical Representative should achieve the sales target though the supervisory capacity necessarily has to be examined keeping in view the manual, unskilled, skilled, clerical work and the person performing such work is a workman and may be, he does not supervise any person but he is the master of his own affairs reporting to management only in respect of quantification of sales, therefore, a Medical Representative cannot be treated to be a workman within the meaning of Section 2(s) of the Industrial Disputes Act, 1947.
8. Learned senior counsel for the petitioner has placed further placed reliance on the decision rendered in the case of Provimi Animal Nutrition India Pvt. Ltd. vs. Secy. M.P. Medical and Sales Representative Association reported in 2019 (160) FLR 383 wherein again this Court analyzed the dispute relating to a Medical Representative and concluded that it cannot be entertained by the Labour Court as a Medical Representative does not come within the definition of workman as defined under Section 2(s) of the Industrial Disputes Act, 1947.
9. Further reliance was placed on the decision rendered in the matter of Zydus Healthcare Ltd. Vs. Brijesh Singh decided in W.P. No.24851 of 2021 on 15.03.2023 wherein similar issue was dealt with and while referring to the case of Novartis India Limited (supra), it was concluded that the Medical Representatives do not fall within the definition of workman. Lastly reliance was placed on the decision rendered in the case of Samat Kumar vs. M/s. Parke Davis India Ltd. reported in 1997 (2) JLJ 353 wherein the Division Bench of this Court has again held that a person working as a Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 6 Professional Service Representative cannot be said to be workman under the definition of Section 2(s) of the Industrial Disputes Act, 1947 and the reference made to the Industrial Court was wholly without jurisdiction.
10. On the basis of aforesaid contentions and the judgments relied upon by the petitioner, it was argued that the respondent No.4, who was working as Regional Business Manager with the petitioner/Company which was a pharmaceutical industry and was engaged in manufacturing and sales of the medicines, with a job to visit doctors, chemists as well as stockists and conduct meetings with different professionals to promote the sales of the product of petitioner/Company cannot be said to be a workman within the definition of Section 2(s) of the Industrial Disputes Act, 1947, therefore, the reference pending before the Labour Court for adjudicating the claim filed by the respondent No.4 is per se illegal and deserves to be dismissed and the order dated 01.08.2017 being without jurisdiction is liable to be quashed.
11. Per contra, learned counsel for the respondent No.4 while placing reliance on the decision rendered by Hon'ble Apex Court in the matter of SPIC Pharmaceuticals Division vs. Authority Under Section 48 (1) of A.P. & Anr. reported in (2007) 2 SCC 616, the decision rendered by Division Bench of this Court in the matter of R.R. Iyer Vs. V.P.G. Life Sciences Ltd. reported in 2010 M.P. L.S.R. 312 (DB), the decision rendered by Hon'ble Apex Court in the matter of Rajneesh Khajuria Vs. M/s. Wockhardt Ltd. and Anr. reported in (2020) 3 SCC 86, the decision rendered by Single Bench of this Court at Principal Seat Jabalpur in the case of Reptakos Brett & Anr. Vs. Ld. Presiding Officer, Labour Court 1 Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 7 Bhopal & ors. in W.P. No. 11805 of 2022 on 11.07.2022, the decision rendered by Single Bench of this Court at Indore in the case of UCB India Pvt. Ltd. & ors. Vs. Additional Labour Commissioner, Indore & ors. in W.P. No.2499 of 2017 on 17.09.2019 contended that the Act which makes the provisions of the Industrial Disputes Act applicable providing remedy to Sales Promotion Employees is a special enactment dealing with service conditions of sales promotion employees employed in the establishment engaged in pharmaceutical industries, therefore, while dealing with the said issue, the Courts in the above judgments had given a finding that the forums created under the Industrial Disputes Act can more effectively deal with the issues raised for all those cases related to Medical Representatives. It was further argued that since this very question is a debatable issue which needs to be framed and adjudicated upon, at this stage, no interference would be called for when the petitioner is at liberty to make a request before the Labour Court to frame the issue. Thus on the basis of the aforesaid submissions, it was argued that present petition being devoid of merits be dismissed.
12. Heard learned counsel for the parties and perused the record.
13. The bare facts giving rise to the present case are that the respondent No.4 vide letter of appointment dated 10.04.2014 was appointed as Regional Business Manager in the Bio Actives Division of petitioner's company on a monthly basis salary as per Annexure A appended to the appointment letter. He was required to perform such duties and function as may be entrusted by the Supervisor and in addition thereto he was obligated to observe and Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 8 perform scope of work/job profile/job description that may be provided/informed to him from time to time. Basically the nature of job was that of sales promotion in pharmaceutical company i.e. petitioner. The services of the respondent No.4 were terminated on 28.01.2016 alleging gross misconduct being committed by him and since the said termination was without following the provision of 25 F of the Industrial Disputes Act which impelled the respondent No.4 to raise the dispute before the Sales Officer whereafter the dispute was preferred before Labour Court for adjudication. The said reference with the Labour Court by the Deputy Labour Commissioner and the proceedings pursuant thereto conducted by Labour Court No.1 Gwalior in case No.35-A/2017 I.D. Act (R) had been challenged on the ground that since respondent No.4 does not fall within the category of workman as defined under Section 2(s) of Industrial Disputes Act, the very reference to the Labour Court was bad in law.
14. Section 2(s) of The Industrial Disputes Act, 1947:-
"workman" means any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person-
(i) who is subject to the Air Force Act, 1950 (45 of 1950), or the Army Act, 1950 (46 of 1950), or the Navy Act, 1957 (62 of Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 9 1957); or
(ii)who is employed in the police service or as an officer or other employee of a prison, or
iii)who is employed mainly in a managerial or administrative capacity, or
(iv)who, being employed in a supervisory capacity, draws wages exceeding [ten thousand rupees] per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature.]
15. The Constitutional Bench of Hon'ble Apex Court in the case of H.R. Adhyanthaya and ors. Vs. Sandoz (India) Ltd. And ors. reported in (1994) 5 SCC 737 held that in order that a person can be designated as a workman under Section 2(s) he/she must be employed to do work which falls within one of the stipulated categories viz. manual, unskilled, skilled, technical, operational, clerical or supervisory. In other words, it is not enough that a person is not covered by either of the four exceptions to the definition. It is now also a well settled principle of law that the burden lies on the person who asserts the status of a workman under Section 2(s) to establish with reference to the dominant nature of his / her duties that the work which is performed falls within one of the stipulated categories in Section 2 (s). The fact that in an organizational structure the employee, in the course of the decision making process, is subject to checks and balances is not a matter which would establish that she / he is a workman within the meaning of Section 2(s). Modern forms of business in corporate organizations put into place a carefully crafted process of checks and balances. Rarely, if Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 10 ever, would an employee have authoritarian control over business decisions. Employees are made subject to checks and balances both at the lateral and vertical level. Managerial decisions are subject to verification and approval. The fact that decisions of an employee are subject to verification or subject to a system of controls and balances does not establish that the employee is a workman within the meaning of Section 2(s). Managers do not become workmen because their decisions are structured by processes and approvals. Absolute autonomy is not the norm in managerial decision making. Nor does the law insist on absolute discretion or absolute autonomy for a person to be a manager. Basically the answer to the question must depend upon the dominant nature of the duties and responsibilities.
16. In the matter of Twenty First Century Printers Ltd. Mumbai Vs. K.P. Abraham & Anr. reported in 2008 SCC Online Bombay 695 while considering the plea as to whether Purchase Officer was a workman within the meaning of Section 2 (s) of Industrial Disputes Act, 1947 following observations were made by the Court:-
10. It was, however, argued that the respondent could not be said to be part of the management because he had no one working under him. The true test must depend on the nature of the function and not whether the person has any other employee working under him. Indeed, an employee can be at the lowest managerial post and could still be said to perform managerial function. Having regard to the nature of the activity of purchase, it appears that the function must be classified as managerial being part of the controlling and regulating functions of the industry.
In this view of the matter, the respondent No. 1 must be held to be an employee mainly in a managerial capacity and is, therefore, excepted from the meaning of "workman" by virtue of section 2(s) (iii) of the Act.
Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 1117. In the light of above proposition, it is necessary to consider the terms of appointment of respondent No.4. The appointment letter dated 10th of April, 2014 describes designation of the petitioner to be that of Regional Business Manager in Bioactives Division of the Company. It further states that it would be required to perform such duties and functions as may be entrusted to him by the Supervisor and in addition thereto he will be obligated to observe and perform the scope of work/job profile/job description as may be provided/informed to him from time to time. Certain terms and conditions of the appointment relevant for adjudication are reproduced hereinbelow;-
2. Designation 2.1 On your appointment with the Company, you will be designated as Regional Business Manager in the Bioactives Division of the Company and will be reporting to any person authorized by the manager, from time to time ("Supervisor"). You will be required to perform such duties and functions, as may be entrusted to you by the Supervisor, and in addition thereto, you will be obligated to observe and perform the scope of work/job profile/ job descriptions may be provided/informed to you, from time to time.
3. Remuneration 3.1 The Basic salary and other Allowances ("Remuneration") will be paid to you by the Company in accordance with Annexure "A" to this letter.
Annexure "A"
Remuneration payable on a Monthly Basis - E03690- Gaurav Sinha Sr. No. Head of Payment Amount 1 Basic Salary Rs. 24168.00/- per Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 12 working Month 2 Leave Travel Allowance (LTA) Rs.13810.00/- per working Month 3 House Rent Allowance (HRA) Rs.9667.00/- per working Month 4 Children Education Allowance Rs.200.00/- per working Month 5 Hostel Allowance Rs.600.00/- per working Month 6 Conveyance Allowance Rs.800.00/- per working Month 7 Medical Expenses Reimbursement Rs.1250.00/- per working Month 8 Bonus Rs.700.00/- per working Month 9 Other Reimbursement Up to Rs. 15913.00/- per working Month 10 Provident Fund (P.F.) We shall be deducting maximum of 12% of your BASIC salary or Rs.780/-
every month and the same amount will be deposited with the P.F. Authorities, alongwith an equivalent amount of employer's share (PF deduction will be as per PF Law)
5. Conduct and Discipline 5.1 xxxx 5.2 xxxx 5.3 You acknowledge and agree that your position in the Company will place you in a position of confidence and trust with the Company, and with the employees, suppliers, agents, customers and clients of the Company and accordingly you will during the Term, and as an employee, representative or nominee of the Company :
(i) At all times and in all respects faithfully, competently and diligently perform such duties and exercise such powers, authorities and discretions as are consistent with your position and Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 13 as may, from time to time, be vested in, or assigned or delegated to you,
(ii) Devote the whole of your time, attention, energy and skill to the business of the Company and in carrying out of the duties, functions and responsibilities assigned to you, from time to time.
(iii) Not engage in any act or activities, which would detract or divert from, or conflict with the proper, due and faithful performance of your duties, functions and responsibilities or the business of the Company or are likely to prejudicially affect the business or reputation of the Company,
(iv) Observe and comply with all directions or instructions from time to time given to you and implement and apply all the Policies of the Company, as determined by the Company from time to time.
(v) Use your best endeavours to promote, develop and protect the business, interests and reputation of the Company,
(vi) Exercise such powers, perform such duties and comply with such directions in relation to the business of the Company as the Company may confer upon, assign or give to you from time to time;
(vii) Keep the Company promptly and fully informed about the tasks undertaken by you in connection with the business of the Company,
(viii) Not incur on behalf of the Company any expenditure in excess of such sum, as may be authorized by the Supervisor, and/ or by the management, from time to time,
(ix) Not enter into on behalf of the Company, any commitment, contract or arrangement which is outside the scope of your normal duties, functions and responsibilities or is of an unusual or onerous or long term nature,
(x) Not engage or employ any person outside the scope of your authority or on terms, which vary from those established from time to time by the Company;
(xi) Not terminate the employment of any employee of the Company outside the scope of your authority and in any case you will immediately report any termination effected by you and the reason for it to the Supervisor, Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 14
(xii) Knowingly do or permit to be done or omit to do any act, deed or thing which is prejudicial to the interests of the company including its business or is in the opinion of the company likely to adversely affect the reputation of the Company in any manner, or
(xiii) Provide necessary information/ details (to the sole satisfaction of the Company) within 3 (three) days, regarding non-
reporting/unauthorized absence to/from the place of work, failing which disciplinary action may be initiated by the Company against you.
18. A perusal of job purpose, role and responsibility of respondent No.4 indicated above would demonstrate that by no stretch of imagination, the respondent No.4 could be termed as a workman. For the purpose of being termed as a workman, the requirement under section 2(s) of Industrial Disputes Act, 1947 are required to be satisfied. The nature of duties which the respondent is required to be performed in terms of the order of appointment specifically enumerated above clearly indicates that the employment of the respondent was neither to do any manual, unskilled, skilled, technical, clerical or supervisory work.
19. The Division Bench of this Court in the matter of Petcare, Division of Tetragon Chemie Pvt. Ltd. Vs. M.P. Medical and Sales Representatives Association & Anr. (W.A. No.922 of 2006) and further in the matter of M.P. Medical and Sales Representatives Association & Anr. Vs. Provimi Animal Nutrition India Pvt. Ltd (W.A. No.07 of 2019) while dealing with the matters relating to Medical Representatives or Sales Promotion Officers has categorically held that Medical Representatives or Sales Promotion Officers do not fall within the definition of workman as provided under Section 2(s) of Industrial Disputes Act, 1947. In the matter of Patcare Division (supra), it has been held as under:-
8. The sole question which has been raised for Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 15 consideration of this Court is whether the Medical Representatives or the Sales Promotion Officers are the "workman" within the definition of Section 2(s) of the Act of 1947 and whether the Labour Court was having a right to entertain the dispute and the same does not fall under the Industrial Disputes Act.
9. The appellant No.2 appearing in person has heavily relied upon the judgment passed in the case of German Remedies Limited vs. Presiding Officer, Labour Court No.1, Bhopal reported in 2006 (II) LLJ 8 MP, wherein it was held that the Labour Court is having jurisdiction to entertain the dispute in respect to Medical Representatives as they fall under the definition as provided in Section 2(s) of the Act of 1947.
10. Learned counsel appearing for the respondent has invited attention of this Court to the judgment passed in the case of Novartis India Limited (supra) wherein the earlier judgment passed in the case of German Remedies Limited (supra) was considered and was held to be not a correct law and it is overruled. The aforesaid aspect was considered by the writ Court, which is clearly reflected from the impugned order.
11. The judgment of the Hon'ble Supreme Court in the case of H.R. Adyanthaya's (supra) is relevant which was subsequently considered by a Division Bench of this Court in the case of Samat Kumar vs. M/s. Parke Davis India Limited reported in 1997 (2) JLJ 353 wherein the definition in Section 2(s) of the Industrial Disputes Act was taken into consideration. The relevant extract is as follows:-
"10. As against it, learned counsel for the respondent No.1 has placed reliance on a case as reported in 1988 (II) MPWN 116 = AIR 1988 SC 1700 (Miss A. Sundarambal v. Govt. of Goa, Deman & Diu and others) whereby it was held that teacher employed in a school is not a workman. But, now dispute stands resolved with respect to the cases of Medical Representative as reported in AIR 1994 SC 2608 [H.R. Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 16 Adyanthya etc. etc. v. Sandoz (India) Ltd. etc. etc.) whereby it has been held that 'Workman' does not include all employees except those covered by four exceptions in said definition of section 2(s) of Industrial Disputes Act. Medical Representatives do not perform duties of 'skilled' or 'technical' nature and therefore, they are not 'workmen'. The connotation of word 'skilled' in the context in which it is used, will not include work of a Sales Promotion Employees such as Medical Representative. That word has to be construed ejusdem generis and thus construed, would mean skilled work whether manual or non-manual, which is of a genre of the other types of work mentioned in the definition. The work of promotion of sales of the product or services of the establishment is distinct from and independent of the types of work covered by the said definition."
After returning such finding it was held that the reference was not maintainable as Medical Representative would not fall within the definition of workman. We are not only bound by the aforesaid judgment but we find the same to be a correct enunciation of law."
12. From the aforesaid, it is clear that the Constitution Bench judgment of H.R. Adyanthaya's (supra) was taken into consideration and it was categorically held that Medical Representative or the Sales Promotion Employee do not fall within the definition of a "workman" as defined in Section 2(s) of the Act of 1947.
13. The learned writ court has gone to the extent of considering the definition of "Sales Promotion Employees" as defined under Section 2(d) of the Act of 1976.
14. After going through the definition it is clearly reflected that the person who is engaged in a supervisory capacity, draws wages exceeding sixteen hundred rupees per mensem, will not be covered under the definition. The learned Single Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 17 Judge has taken into consideration the amount of wages which has been claimed and drawn by the appellant and has clearly held that even if from this angle the case of the appellant is considered, then also he does not fall under the definition of "Sales Promotion Employees" or the "Medical Representative" in terms of Section 2(s) of the Act of 1947.
15. A three-Judge Bench of the Hon'ble Supreme Court in the case of May and Baker (India) Limited vs. Workmen', reported in AIR 1967 SC 678 had an occasion to directly deal with the question as to whether the Medical Representatives of the company, who are discharged from service, are the workman under the Industrial Disputes Act and the order of reinstatement passed by the Industrial Tribunal was, therefore, valid. The Hon'ble Supreme Court referred to the undisputed nature of the duties of the employees and found that his main work was of canvassing sales. Any clerical or manual work that he had to do was incidental to the said main work, and could not make more than a small fraction of time for which he had to work. In the circumstances, the Hon'ble Supreme Court held that the Tribunal's conclusion that the employee was a workman under the Industrial Disputes Act was incorrect.
16. The similar issue was considered by a three- Judge Bench judgment of the Hon'ble Supreme Court in the case of Western India Match Company Limited vs. Workman 2 reported in AIR 1964 SC
472. The question before the Court was whether the sales office was entirely independent of the factory or was a department of the one and the same unit of production, and whether Inspectors, Salesman and Retail Salesman of the sales office were workmen within the meaning of U.P. Industrial Disputes Act. The matter was referred by the State Government for adjudication to the Industrial Tribunal on 18.08.1961. After a detailed analysis of the matter, Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 18 the Bench following the earlier decision in the case of May and Baker's case (supra) has arrived at a similar finding that they cannot be termed as a workman in terms of the definition under the Act of 1947.
17. Similar issue was considered in the case of Burmah Shell Oil Storage and Distribution Company of India Limited vs. Burmah Shell Management Staff Association reported in AIR 1971 SC 922 and again the judgment passed in May and Baker's case (supra) was taken into consideration and the Court has given the verdict in the light of May and Baker's case. The three-Judge Bench in the case of May and Baker (supra) has taken a view that a person to be qualified to be a workman must be doing the work which falls in any of the four categories viz. manual, supervisory, technical or clerical. If a person does not fall within the four exceptions to the aforesaid definition, he is a workman within the definition as provided under Section 2(s) of the Act of 1947. Therefore, the position is clarified by the Hon'ble Supreme Court in the aforesaid cases.
18. The Constitution Bench of the Hon'ble Supreme Court in H.R. Adyanthaya's (supra) has categorically held that the Medical Representatives are not the workman; therefore, the complaint made to the Industrial Court is not maintainable itself. The arguments raised by the appellant that even in the case of H.R. Adyanthaya's (supra), the benefits were extended and they were treated to be the complainant in the matter and the State Government was given directions but the fact remains that the powers were exercised under Article 142 of the Constitution of India by the Hon'ble Supreme Court. But the law which has been settled in the aforesaid case by the Constitution Bench is clear that the Medical Representatives or the Sales Promotion Officer do not fall under the definition of workman. The learned Single Judge has followed the aforesaid Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 19 judgment passed by the Hon'ble Supreme Court and has rightly set aside the order passed by the Labour Court. Under these circumstances, we do not have any hesitation to observe that no illegality is committed by the writ court in allowing the writ petition. In absence of any cogent material or a judgment to override the observations made by the writ court and the law settled by the Constitution Bench of the Hon'ble Supreme Court in H.R. Adyanthaya's (supra), no relief can be extended to the appellant.
20. Another Division Bench of this court in the case of Novartis India Limited (supra) while dealing with similar case of medical representatives relying upon the decision of Hon'ble Apex Court rendered in H.R. Adhyanthaya (supra) has held that when an employee essentially performs function of Medical Representative in a Pharmaceutical Company, the duties attached to his post are neither managerial nor administrative. The Division Bench further held that the Medical Representative does not supervise any person but he is the master of his own affairs reporting to Management only in respect of quantification of sales, therefore, a Medical Representative cannot be treated to be a workman within the meaning of Section 2(s) of the Industrial Disputes Act, 1947. The relevant paragraphs of the said judgment are reproduced below:-
"14. In view of the aforesaid judgment, the question as to whether a person is a workman within the meaning of Section 2(s) of the ID Act mainly depends upon the nature of the industry, type of work in which he is engaged, organizational set up of particular unit of industry and other factors. In the present case, the respondent was engaged as Sales Representative in a Pharmaceutical Company. His primary duty was to visit doctors, chemists as well as stockists. Meeting different professionals to promote sale of product of the appellant cannot be said to be manual or clerical work as it requires knowledge of product, its uses and also persuasive skills. The respondent may not be controlling any subordinate but he was master of the work assigned to him. The manner of performing the job was solely in Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 20 the discretion of the respondent. The interest of the management was that the Medical Representative should achieve the sales target. The supervisory capacity necessarily has to be examined keeping in view the manual, unskilled, skilled, clerical work and the person performing such work is a workman. May be, he does not supervise any person but he is the master of his own affairs reporting to management only in respect of quantification of sales, therefore, a Medical Representative cannot be treated to be a workman within the meaning of Section 2(s) of the ID Act.
15. The judgment in H.R. Adyanthaya's case (supra) has come up for consideration before a Division Bench of this Court in Samat Kumar v. M/s Parke Davis India Ltd., 1997 (2) JLJ 353 wherein the reference to Labour Court was subject matter of challenge on the part of the management. Though the workman was said to be working as Area Sales Manager in managerial capacity drawing salary of more than Rs.1,600/-, therefore, he was not a workman but while examining the scope of Adhyanthaya's case (supra), the Court has held that the work of promotion of sales of the product or services of the establishment is distinct from and independent of the types of work covered by the said definition under Section 2(s) of the ID Act. The relevant extract of the Division Bench judgment reads as under:-
"10. As against it, learned counsel for the respondent No.1 has placed reliance on a case as reported in 1988 (II) MPWN 116 = AIR 1988 SC 1700 (Miss A. Sundarambal v. Govt. of Goa, Deman & Diu and others) whereby it was held that teacher employed in a school is not a workman. But, now dispute stands resolved with respect to the cases of Medical Representative as reported in AIR 1994 SC 2608 [H.R. Adyanthya etc. etc. v. Sandoz (India) Ltd. etc. etc.) whereby it has been held that 'Workman' does not include all employees except those covered by four exceptions in said definition of section 2(s) of Industrial Disputes Act. Medical Representatives do not perform duties of 'skilled' or 'technical' nature and therefore, they are not 'workmen'. The connotation of word 'skilled' in the context in which it is used, will not include work of a Sales Promotion Employees such as Medical Representative. That word has to be construed ejusdem generis and thus construed, would mean skilled work whether manual or non-manual, which is of a genre of the other types of work mentioned in the definition. The work of promotion of sales of the product or services of the establishment is distinct from and independent of the types of work covered by the said definition."
After returning such finding it was held that the reference was not maintainable as Medical Representative would not fall within the definition of workman. We are not only bound by the aforesaid judgment but we find the same to be a correct enunciation of law.
Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 2116. Learned Single Bench of this Court in German Remedies Limited's case (supra) relying upon H.R. Adyanthaya's case (supra) held that the Medical Representative is a workman. The relevant extracts of the said decision in German Remedies Limited's case read as under:-
"14. With regard to meet out, the objections - the petitioner about the status of respondent No. 2, whether he would be a workman within the meaning of Section 2(s) of the Industrial Disputes Act, 1947, has to be dealt with. The Apex Court had an occasion to consider a similar question in a judgment H.R. Adyanthaya v. Sandoz (India) Ltd. and others [(1994) 5 SCC 737]. The Apex Court in the said case was considering the status of Medical Representatives and the Apex Court came to the conclusion that since there had been an amendment in the provisions of the Industrial Disputes Act, 1947 and also by virtue of the provisions of Section 6 of the Sales Promotion Employees (Conditions of Service) Act, 1976 makes application to the provisions of the Industrial Disputes Act, 1947 as in force for the time being, therefore, the Apex Court held that a Medical Representative shall be a workman within the meaning of Section 2(s) of the Industrial Disputes Act, 1947.
15. The aforesaid judgment passed by the Apex Court had also been considered by the Rajasthan High Court in Dolphin Laboratories Ltd. v. Judge, Labour Court, Udaipur and Another 2001-II-LLJ-559 (Raj.) and also by Punjab & Haryana High Court in Ripu Daman Bhanot v. Presiding Officer, Labour Court, Ludhiana and Ors. 1997-I-LLJ-557 (P&H). The aforesaid two High Courts have also dealt with the similar questions and relying upon the ratio of Sandoz's case (supra) held that Medical Representative is a workman for the purpose of Section 2(s) of the Industrial Disputes Act, 1947.
16. In view of the aforesaid law laid down by the two High Courts based upon the earlier judgment passed by the Apex Court in Sandoz's case (supra), this objection of the petitioner also cannot be accepted."
The Single Bench in German Remedies Limited's case (supra) has misread the judgment in H.R. Adyanthaya's case (supra) to hold that Medical Representatives are workmen within the meaning of Section 2(s) of the ID Act. In fact, three categories were created by the Supreme Court. In respect of the Medical Representatives engaged prior to enactment of SPE Act w.e.f. 06.03.1976, they were held not governed either by ID Act or SPE Act. In respect of employees whose services were terminated after 06.03.1976, the appeals were dismissed for the reason that it is not the case of the employees that their wages were less than Rs.750/- per month excluding commission, therefore, the SPE Act did not apply to them. The only dispute which was referred to Industrial Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 22 Court under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practice Act, 1971 was in respect of transfer of the employees affected on 16.02.1988. The Supreme Court found that the definition of workman under ID Act will not cover the sales promotion employees within the meaning of SPE Act. The argument raised that the sales promotion employees are skilled or operational employees was not accepted. Therefore, the order of the learned Single Bench is not the correct reading of H.R. Adyanthaya's case (supra) and is, thus, overruled.
17. A Division Bench of Patna High Court in Deepak Kumar v. State of Bihar (2016) 149 FLR 528, held as under:-
"9. The Sales Promotion Employee as defined under the SPE Act as reproduced above includes any person by whatever name called (including an apprentice) employed or engaged in any establishment for hire or reward to do any work relating to promotion of sales or business, or both. The main provision is wide enough to include all categories of employees engaged for hire or reward to do any work relating to promotion of sale of business. The petitioner falls within such category. As admittedly, he was appointed as a person to promote sale of the pharmaceutical products, as is evident from Charge Sheet dated 13th December, 2002, which is to the effect that the appellant has failed to achieve the targets of sale of group of medicines. The notice (Annexure2 to the writ petition) itself recites the appellant as a Medical Representative. Therefore, he is a Sales Promotion Employee. But there is exclusion clause of Sales Promotion Employees and not all Sales Promotion Employees are the employees within the meaning of Section 2(d) of the SPE Act. The employees who are employed or engaged in supervisory capacity drawing wages exceeding Rs.1,600/- per mensem is the first category which are not the Sales Promotion Employees. The second category is the employees who are employed or engaged mainly in a managerial or administrative capacity."
18. In view of the said fact, the Award passed by the learned Labour Court and the order passed by the learned Single Bench is set aside holding that the Medical Representative is not a workman within the meaning of Section 2(s) of the ID Act and Section 2(d) of the SPE Act. The appeal stands allowed and disposed of "
21. After returning such findings, it was held that the reference is not applicable as Medical Representatives do not fall within the definition of workman.Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 23
22. So far as the judgment relied upon by learned counsel for respondent No.4 rendered by Hon'ble Apex Court in the matter of SPIC Pharmaceuticals Division (supra) is concerned, it is seen that therein the provisions of Sales Promotion Employees (Conditions of Service) Act, 1976 and Andhra Pradesh Shops and Establishment Act, 1988 were dealt with and in the case of termination of service of a Medical Representative, it was observed that in comparison to the forum available under the Andhra Pradesh Shops and Establishment Act, 1988, the forum created under the Industrial Disputes Act, 1947, on the facts of the case, can more effective in dealing with the issue raised and in the said case, there was no discussion with regard to applicability of the provisions of Industrial Disputes Act over the Medical Representatives. Thus the said case has no relevance.
23. So far as the reliance placed by learned counsel for the respondent on the decision of Division Bench of this Court in the matter of R.R. Iyer (supra) wherein while placing reliance in the matter of Rhone Poulene Ltd. Vs State of U.P. & ors. reported in (2000) 7 SCC 675 had held that by virtue of Section 6(2) of Sales Promotion Employees (Condition of Service) Act, 1976, a Medical Representative is a deemed workman under the provisions of Industrial Disputes Act, 1947, therefore, the reference made to the Labour Court would be justified is concerned, the Hon'ble Apex Court in the matter of Rhone Poulene Ltd. (supra) though by invoking powers under article 142 of the Constitution of India had directed the dispute to be carried under section 10 (1)(d) of the Industrial Disputes act, 1947, had not taken a different view from that of the Constitutional Bench in the matter of H.R. Adhyanthya Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 24 (supra) wherein it was in specific terms held that Medical Representatives are not covered under the definition of workman but following course which has been taken by the Constitutional Bench in continuing with the reference, since long time had passed from the date of reference, it was held that reference would continue with Labour Court. Since the same is not a case herein, the said judgment is also of no help to the respondent.
24. So far as reliance placed by learned counsel for the respondent in the matter of Rajneesh Khajuria (supra) is concerned, the said matter related to unfair labour practices and the jurisdiction for dealing with the said complaint relating to unfair labour practices has been described in item 1 of schedule 4 of Industrial Disputes Act, therefore, it was held that since the statute has created a forum for redressal of grievance, the jurisdiction to entertain such matter would lay before Labour Court and not in the Industrial Court. Since this is not a question herein, therefore, the said judgment is not applicable in the present case.
25. So far as reliance placed in the matter of Reptakos Brett and Company Ltd. (supra) is concerned, nothing has been discussed by learned Single Judge in the said matter, thus, the judgment is of no help to the respondent.
26. Lastly, so far as reliance placed in the matter of UCB India Pvt. Ltd (supra) is concerned, in the said matter, the coordinate Bench of this Court was dealing with an issue of transfer of respondent No.2 therein. Since no objection with regard to respondent/employee therein to be a workman was raised before learned Labour Court, it was observed that at this stage, it would not be proper to remand the matter to the Labour Court to decide it Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM 25 again. Thus, the said judgment is of no help to the respondent No.4.
27. Thus, this Court finds that on both counts; firstly, if the respondent No.4 is said to have been engaged by the petitioner as Regional Business Manager, looking to the terms and conditions of his employment, the respondent No.4 cannot be in any way said to be a workman and, secondly, even if it is assumed that the capacity of petitioner was only that of Medical Representative (Sales Promotion Employee), in the light of the aforesaid judgments, he would not fall under the category of workman.
28. Thus, this Court has no hesitation to hold that respondent No.4 who was working as a Regional Business Manager/Medical Sales Representative/Sales Promotion Employee do not fall within the definition of workman under Section 2 (s) of Industrial Disputes Act, 1947.
29. Consequently, the petition is hereby allowed. Order dated 01.08.2017 passed by respondent No.2 whereby the matter has been referred to the Labour Court treating the claim of respondent No.4 to be a Industrial Dispute is hereby quashed. Resultantly, the proceedings pending before the Labour Court pursuant thereof are also hereby quashed.
(MILIND RAMESH PHADKE) ojha JUDGE Signature Not Verified Signed by: YOGENDRA OJHA Signing time: 02-08-2024 10:32:03 AM