Madras High Court
The Management Of Madras vs The Deputy Chief Inspector Of Factories on 29 January, 2018
Author: M.Sundar
Bench: M.Sathyanarayanan, M.Sundar
IN THE HIGH COURT OF JUDICATURE AT MADRAS
RESERVED ON : 14.12.2017
DELIVERED ON : 29.01.2018
CORAM:
THE HON'BLE MR. JUSTICE M.SATHYANARAYANAN
AND
THE HON'BLE MR.JUSTICE M.SUNDAR
W.P.No.5156 of 2005
and WMP.No.5680 of 2005
The Management of Madras
Aluminium Company Limited,
Mettur Dam-2.
Substituted as
The Management of Sesa Sterlite
Industries Limited, Salem .. Petitioner
(Name of the petitioner substituted as per
Order dated 29.01.2018 made in
WMP.No.14 of 2014)
Vs.
1.The Deputy Chief Inspector of Factories,
Salem.
2.T.Ramani
3.N.Velan
4.K.Perumal
5.P.P.Jayakumar
6.P.Anbarasan .. Respondents
Prayer: Writ Petition filed under Article 226 of the Constitution of India praying for issuance of a Writ of Certiorari to call for the records of the first respondent in reference N.E.10287/2002 and quash its order dated 04.01.2005.
For Petitioner : Mr.Anand Gopalan
for M/s.T.S.Gopalan & Co.
For Respondents : Mrs.M.E.Raniselvam,
Additional Govt. Pleader for R1
Mr.K.M.Ramesh for R2, R3 and R6
Mr.V.T.Arun Thomas for R4 and R5
O R D E R
M.SATHYANARAYANAN, J.
The Management of Madras Aluminium Company Limited [in short MALCO] is the writ petitioner and aggrieved by the order dated 04.01.2005 passed by the first respondent, in and by which conferment of permanent status has been accorded to the private respondents herein, came forward with this writ petition. The Writ Petition was admitted on 17.02.2005 and an order of interim stay until further orders was granted on that day. When the Writ Petition was listed on 25.06.2013, the learned Judge expressing doubt as to whether the authority under the Permanent Status Act has got power to resolve the above said question by adjudicating upon the same as done by the Labour Court, has formulated the following questions and referred the matter to the Division Bench to answer and it is relevant to extract the same:
i.Whether the authority under the Permanent Status Act has got power to go into the question, as to whether the contract alleged by the Establishment is genuine or the same is sham and nominal?
ii.Whether the authority under the Permanent Status Act has got adjudicatory power to adjudicate upon the issue as to whether the workmen are directly employed by the Establishment or whether only as contract labours under the Contractor?
iii.Whether the authority under the Permanent Status Act has got adjudicatory power, so as to afford opportunity to adverse party, while recording evidence for the purpose of cross-examination and also letting in evidence?
iv.Whether the powers conferred upon the Industrial Tribunal, Labour Court to adjudicate upon the above issues is a bar for the authority under the Permanent Status Act, to go into the above issues?
2. The Registry, after obtaining appropriate orders from the Hon'ble The Acting Chief Justice, had referred the matter before the Division Bench. Similarly, W.P.No.35119 of 2007 filed by ONGC came up for hearing before the same learned Judge and after referring to the reference in W.P.No.5156 of 2005, the learned Judge has directed the tagging of the said writ petition along with W.P.No.5156 of 2005, after obtaining appropriate orders from the Hon'ble The Acting Chief Justice. The Registry, after obtaining appropriate orders, listed both the writ petitions together for answering the said reference. Thereafter, both the matters were listed before us [Justice M.Sathyanarayanan and Justice M.Sundar], on being assigned to this Bench as a Specially Ordered matter by Hon'ble Chief Justice.
3. Both the matters were taken up for hearing on 21.08.2017 and after hearing the arguments for some time, this Court felt that four points of reference can be re-casted and formulated the following question:
Whether the first respondent before us i.e., Deputy Chief Inspector of Factories, Salem, has adjudicatory powers? The learned counsel appearing for the petitioner in W.P.No.35119 of 2007 made a request that the said writ petition is to be taken up separately and hence, vide order dated 21.08.2017, this Court ordered listing of both the writ petitions separately in the second week of September, 2017 before the same Bench. Accordingly, arguments were advanced by the respective learned counsel for the parties and orders were reserved.
4. It is brought to the knowledge of this Court by the learned counsel appearing for the petitioner/Management that pendency of the same, vide order dated 25.07.2013 made in Comp. Petition No.165 of 2012, this Court passed an order approving the Scheme of Arrangement under which the Aluminium business of the petitioner Company is merged with Sesa Goa Limited, which is renamed as Sesa Sterlite Limited, as per the Certificate of Incorporation dated 18.09.2013 and hence, W.M.P.No.14 of 2014 was filed to amend the cause title. This Court heard the respective learned counsel appearing for the parties and satisfied with the reasons stated in the affidavit filed in support of this petition and therefore, W.M.P.No.14 of 2014 is ordered.
5. The petitioner, in the affidavit filed in support of this writ petition, would aver among other things that it is having a factory at Mettur Dam where it manufactures Aluminium Ingot, Aluminium Wire Rods and Buss Bars and it is also registered under Factories Act. The petitioner Company is having workforce of 780 regular workmen and the lowest wage being paid to a direct workmen is Rs.7,500/- per month. The petitioner would further aver that it has been adopting a consistent policy of employing direct workmen only on jobs, which add value to the product, jobs for which the required manpower could be estimated and jobs for which sustained work can be given for full shift hours and the other jobs are normally entrusted to outside agencies, especially maintenance of sanitary facilities in the factory, guest house and employees quarters, which does not require employment of workmen for full shift hours. The petitioner company also got itself registered as a Principal Employer under the Contract Labour (Regulation & Abolition) Act and till the year 2003, maintenance of sanitary facilities was being attended to by Contractor and in the year 2003, a separate contract was awarded to the second respondent for attending to sanitary work at factory, colony and guest house and gardening work. As per practice, every month, the contractor used to submit a bill for the service rendered based on man days and the expenses incurred towards hiring of tractor and other equipments, based on which the company used to settle the bills by way of cheque for the billed amount after deducting the contribution payable in respect of the workmen towards Provident Fund and ESI.
6. It is further stated that in the year 2001, the workmen of the contractor resorted to an agitation and demanded that they should be absorbed in the employment of the petitioner company and they filed a petition under the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen Act), 1981 [in short Permanent Status Act]. The contract workmen were represented by Aluminium Tholilalar Sangam, which also represents the direct workmen of the establishment. A settlement was reached on 21.02.2001 with the Aluminium Tholilalar Sangam, by which it was agreed that scavenger of the Contractor will be given an increase of Rs.25/- in daily wages. During April 2004, the respondents 2 to 6 with one other workman moved the first respondent seeking conferment of permanent status in terms of the said Act. Notices were ordered and the first respondent, on consideration of the materials placed and after taking into consideration various decisions rendered by this Court, passed the impugned order dated 04.01.2005, holding that the respondents 2 to 6 were entitled to claim permanent status in terms of the said Act and challenging the legality of the same, the petitioner Company came forward with this writ petition.
7. Mr.Anand Gopalan, learned counsel representing M/s.T.S.Gopalan & Co., appearing for the petitioner/Management has drawn the attention of this Court to the various provisions of the Permanent Status Act and would submit that the proceedings under the said Act are summary in nature and would further add that Section 3 of the said Act provides that every workmen who is in continuous service for a period of 480 days in a period of 24 calendar months in an industrial establishment shall be made permanent and Section 5(c) of the said Act empowers the Inspector to exercise such powers as may be necessary for carrying out the purposes of this Act. The learned counsel appearing for the petitioner/Management would further submit that vide G.O.Ms.No.2813 dated 24.12.1981, the Government of Tamil Nadu has framed rules under the Permanent Status Act and as per Rule 6, procedure is contemplated for maintenance of Registers by employers and the said Rule merely enables the concerned Inspector to check and find out whether entries have been made correctly or not and it can merely issue suitable direction for reference in Form No.1 and therefore, he does not have any adjudicatory power to determine the primordial issue as to whether the workmen is to be made permanent or not? It is also contended by the learned counsel appearing for the petitioner Company that for the purpose of invoking Rule 6, the concerned applicant should be either temporary/casual/badli workmen and apprentices other than those covered under the Apprentices Act, 1961 and the said Act would not apply to workmen employed by contractor, which holds Certificate of Registration under the Contract Labour (Regulation & Abolition) Act.
8. The learned counsel appearing for the petitioner has also drawn the attention of this Court to the provisions of various labour enactments such as Minimum Wages Act, 1948, Payment of Bonus Act, 1965, Payment of Gratuity Act, 1972, Payment of Wages Act, 1936, Employees' Provident Funds and Miscellaneous Provisions Act, 1952, Employees' State Insurance Act, 1948 and Equal Remuneration Act, 1976, Tamil Nadu Payment of Subsistence Allowance Act, 1981, Tamil nadu Handloom Workers (Conditions of Employment and Miscellaneous Provision) Act, 1981 and rules framed thereunder and would submit that proper adjudicatory mechanism has been provided and would further add that as per the provisions of Permanent Status Act, there is no express provision conferring the concerned authority by way of adjudication to decide the issue as the eligibility of a particular workman to get permanency in an establishment.
9. The primordial submission made by the learned counsel appearing for the petitioner is that Rule 6(4) of the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Rules, 1981 merely enables the concerned authority to verify the correctness of the entries and depending upon the result of the same, vest with the power to rectify Form 1 and in the absence of any specific power/provision conferring the said authority to adjudicate the issue relating to permanency, there cannot be any positive direction granting permanent status to workmen. Alternatively, it is the submission of the learned counsel appearing for the petitioner that the Permanent Status Act has no application in respect of workmen employed by a contractor in an establishment which is registered under the provisions of the Contract Labour (Regulation and Abolition) Act, 1970.
10. The learned counsel appearing for the petitioner has also invited the attention of this Court to the testimonies of the witnesses, exhibits and the contents of the impugned order and would submit that the first respondent has failed to consider the issue in proper perspective and by merely relying upon certain decisions rendered by the Hon'ble Apex Court as well as this Court and without assigning proper and sufficient reasons, has ordered the petition in favour of the private respondents/workmen and since there is error apparent on the face of the record and the findings were rendered without proper appreciation of oral and documentary evidence, prays for interference. The learned counsel appearing for the petitioner, in support of his submissions, placed reliance upon the following decisions:
(i)State of Tamil Nadu and Others v. Nellai Cotton Mills and Others [(1990) 2 SCC 518]
(ii)Oil and Natural Gas Corporation Ltd. v. Engineering Mazdoor Sangh [(2007) 1 SCC 250]
(iii) Accounts Officer (A&I), APSRTC and Others v. K.V.Ramana and Others [2007 (1) L.L.J. 1042]
(iv) Divisional Manager, Aravali Golf Club and Another v. Chander Hass and Another [(2008) 1 SCC 683]
(v)R.Rathakrishnan v. Deputy Registrar of Cooperative Societies, Dindigul [2007 (4) L.L.N. 868 (FB)]
11. Per contra, Mr.K.M.Ramesh, learned counsel appearing for the private respondents/workmen would submit that the point of reference is no longer res integra in the light of the following judgments:
(i)Mamudiraj N. & Others v. Bharat Heavy Electricals Ltd., Trichy & Another [1999 (I) LLJ. 622]
(ii) Superintending Engineer, Vellore Electricity Distribution Circle, Vellore and Others v. Inspector of Labour, Perambalur and Others [2004 (3) LLN 598 (Mad.)]
(iii) R.Ashok and Others v. Chairman, Tamil Nadu Generation and Distribution Corporation Ltd. and Others [(2013) 2 LLJ 562]
(iv) The Chairman, Tamil Nadu Electricity Board v. The Inspector of Labour, Karur [(2017) 1 LLJ 540] The learned counsel appearing for the private respondents/workmen would submit that the services of the private respondents continued to be engaged and necessary deductions have been made towards Provident Fund and contributions have been made by the employee and corresponding contribution from the employer was also made and in the light of the fact that engagement of private respondents are continuing for quite long time and their need and requirement is perennial/permanent in nature and the petitioner/Management, by adopting Unfair Labour Practice, continued to engage them temporarily and they sought to negate their legal right on the ground that they were engaged through Labour Contractor. The learned counsel appearing for the private respondents has invited the attention of this Court to the above cited judgments and would submit that similar contention was put forward as to the non-applicability of the provisions of the Permanent Status Act to the workers employed through Labour Contract and the said contention was repelled and it has also been held that the first respondent, being an authority constituted under the provisions of the Permanent Status Act, is entitled to adjudicate the issue as to the conferment of permanency and as such, the present writ petition lacks merit and prays for dismissal of this writ petition.
12. This Court has considered the rival submissions and perused the entire materials placed before it and also considered the decisions relied on by the respective learned counsel appearing for the parties.
13. Now this Court considers the decisions relied on by the respective learned counsel appearing for the parties.
14. In State of Tamil Nadu and Others v. Nellai Cotton Mills Ltd. and Others [(1990) 2 SCC 518], vires of Permanent Status Act came up consideration in a batch of writ petitions and this Court allowed the writ petitions in part, inter alia, holding as follows:
2...The Explanation to section 3 is incapable of enforcement and must therefore be held to be redundant. (2) (2) The provisions of Section 3(2) of the Act are valid except that the 'clause or on account of non-employment or discharge of such workman for a period which does not exceed three months and during which period a substitute has been employed in his place by the employer' is void on the ground that it amounts to an unreasonable restriction on the right of the employer.
(3) An apprentice or a badli worker could not be included in the 'workman' referred to in section 3(1) and (2) of the Act, and they will, therefore, be not entitled to the bene- fit of section 3.
(4) The Act will not supersede a settlement between the workers and the employer in so far as it deals with the subject of conferment of permanent status to workman. (5) The Act cannot be held to be retrospective in character."
The State, challenging the legality of the said judgment, filed Special Leave Petitions before the Hon'ble Supreme Court of India and on admission, those SLPs were converted as Civil Appeals and were dismissed and subsequently amendment was put forward by the Legislature. In the light of the said judgment, vires of the remaining provisions of the said Act has been upheld except in respect of Section 3.
15. The primordial submission made by the learned counsel appearing for the petitioner/Management is that the private respondents, who were engaged through Contract Labour are not entitled to the benefits of the said Act and even assuming their prayer for regularization can be considered, still they cannot be accommodated for the reason that their engagement is through back door and the management, dehors the rules and regulations, cannot accommodate them for want of sanctioned posts and in this regard, placed reliance upon the following decisions:
(i)Oil & Natural Gas Corporation Ltd. v. Engineering Mazdoor Sangh [(2007) 1 SCC 250]
(ii) Accounts Officer (A&I), APSRTC and Others v. K.V.Ramana and Others [2007 (1) L.L.J. 1042]
(iii) Divisional Manager, Aravali Golf Club and Another v. Chander Hass and Another [(2008) 1 SCC 683]
(iv)R.Rathakrishnan v. Deputy Registrar of Cooperative Societies, Dindigul [2007 (4) L.L.N. 868 (FB)]
16. In Superintending Engineer, Vellore Electricity Distribution Circle, Vellore and Others v. Inspector of Labour, Perambalur and Others [2004 (3) LLN 598 (Mad.)], the power of Labour Inspector under Permanent Status Act came up for consideration and a learned Single Judge of this Court, taking into consideration various decisions and on exhaustive analysis of various provisions and rules framed thereunder including the plea with regard to engagement of manpower through Contractor, observed as follows:
33. While considering the said question, it will have to be stated that while on the one hand the evidence placed before the Inspector of Labour on the side of the concerned workmen remained, the same was also not controverted, no iota of evidence was placed on the side of the Board as to either about the nature of the employment or about the details of their employment. The Board was rest content with the various contentions raised by it in its counter. But, the fact about the engagement of the services of the concerned workmen was never disputed by the Board. The only stand was that since they were all contract workmen, they were not entitled for any benefit to be conferred under the provisions of the Act. But even in respect of the said stand except the ipsi dixit of the stand taken in the counter nothing was placed before the Inspector of Labour. Even about the nonmaintenance of the required Forms under the provisions of the Act, the stand of the Board was that since they were all contract labourers, the question of maintaining those records did not arise. It is pertinent to note that while it was contended that the persons were employed as contract labourers under certain guidelines, nothing was placed before the Inspector of Labour in support of the said stand. The claim of the concerned workmen was that under the guise of contract labourers, they were asked to perform various jobs, which were required to be performed by the regular employees of the Board. In para 34 of the said decision, the learned Single Judge, taking note of Rule 6 of the Permanent Status Rules, observed as under:
Therefore, it can safely held that by virtue of S.5 read with Rule 6(4), the Inspector of Labour can pass positive orders conferring permanent status to the workmen concerned after examining the representation made before him and after holding an enquiry........... The well known canon of construction is that no provision in a statute can be held to be redundant and therefore, when under Section 5 of the Act specific powers have been provided to the effect that the Inspector of Labour can enter at all reasonable times into any industrial establishments, make necessary examinations of the records and record necessary evidence of such persons as he may deem necessary for carrying out the purposes of the Act and when the said provisions read along with Rule 6(4) which specifically provides that such exercise of powers provided under Section 5 can be made while dealing with a representation and by passing a positive order conferring permanent status, it will have to be held that the Inspector of Labour would be fully competent to issue an order conferring permanent status to the workmen based on the evidence available before it based on the enquiry held by him, if it was brought out that such a benefit should necessarily be conferred on the concerned workmen. I can only say that to hold otherwise would only defeat the whole purpose of the Enactment, the object of which was that wherever workmen are being kept under temporary roles, thereby denied of various statutory as well as nonstatutory benefits, which are extended to the permanent workers and wages are paid on consolidated basis far below the occupational wages without the benefit of Dearness Allowance, which is paid to the permanent employees, to defeat such deprivation and ensure that their real status is affirmed. In para 35 of the said order, it was observed that while the exercise of powers vested with the Inspector under the provisions of the Act is summary in nature, the one under the provisions of the Industrial Disputes Act may be an elaborate one. Nevertheless the same does not mean that by exercising the power under the provisions of the Act, the Inspector of Labour would be trespassing into the adjudication process contemplated under the provisions of the Industrial Disputes Act .
17. In R.Ashok and Others v. Chairman, Tamil Nadu Generation and Distribution Corporation Ltd. and Others [(2013) 2 LLJ 562], the request made by the private respondents therein to implement the order conferring permanent status in the form of writ petition came to be rejected and they filed Writ Appeal in W.A.(MD).No.774 of 2012, wherein the Division Bench of this Court, after taking into consideration various decisions rendered by the Hon'ble Apex Court as well as this Court, in para 37 of the decision, passed the following order:
37. For non-implementation of the orders passed under the Act by the Inspector, no doubt there is provision for prosecuting the employer. But, that is not suffice for the employees, because they need security in their employment than securing conviction for their employer. There is no execution machinery provided in the Act to execute the orders passed by the Inspector. But, the orders passed by the Inspector of Labour by virtue of the provisions of a Statute is a statutory order. The Electricity Board is an instrumentality of the State and is bound to perform the statutory duty imposed upon it under the Act. On it's failure to discharge it, the workmen can knock the doors of this Court for justice under Article 226 of the Constitution of India seeking issuance of Mandamus or any other directions or orders to perform its duty.
18. In The Chairman, Tamil Nadu Electricity Board v. The Inspector of Labour, Karur [(2017) 1 LLJ 540], a Division Bench of this Court in which one of us is a party [Justice M.Sathyanarayanan] had referred to all the earlier judgments including the judgments in Superintending Engineer, Vellore Electricity Board Distribution Circle, Vellore v. Inspector of Labour [(2004) 3 LLN 598] and R.Ashok and Others v. The Chairman, Tamil Nadu Generation and Distribution Corporation Ltd. and Others [(2013) 2 LLJ 562] (cited supra) and granted two weeks time to TNEB to implement the orders passed by this Court.
19. The learned counsel appearing for the petitioner has invited the attention of this Court to the testimonies of the witnesses and would submit that admittedly, the private respondents, more particularly the respondents 3 to 6 were engaged through Contract Labour and the second respondent himself is a Labour Contractor and the testimonies of the witnesses would also disclose clearly that there are no appointment orders and no monthly Pay Certificates have been given and they have not been provided with Identity Cards and like permanent employees, they have not been provided with Dearness Allowance, Transport Allowance, House Rent Allowance etc., and however, their oral testimonies have not been taken into consideration at all.
20. A perusal of the impugned order passed by the first respondent would disclose that reliance has been placed on the decision in General Produce Ltd., Alleppey v. Ambalapuzha Taluk Head Load Conveyance Workers Union, Alleppey [1957 II L.L.J 477 (SC)], wherein it has been held that if a Contract Labour join with other labourer and do the work, he cannot be treated as Contract Labour, but only an employee/workman. The first respondent also placed reliance upon the decision in Superintending Engineer, Vellore Electricity Distribution Circle, Vellore and Others v. Inspector of Labour, Perambalur and Others [2004 (3) LLN 598 (Mad.)] (cited supra) and also taking note of Section 2(4) of the Permanent Status Act, which defines workman, concluded that the concerned workmen are entitled to permanency on completion of 480 days of continuous service in two calendar years.
21. The learned counsel appearing for the petitioner has placed reliance upon the typed set and additional typed set of documents and would submit that the second respondent herein is a Labour Contractor and proceedings have been issued granting extension of the work order for sanitary maintenance in the colony and factory and as such, they cannot be conferred with permanent status. However, the said documents came into existence subsequent to the impugned order. The typed set of documents dated 22.04.2013, filed on behalf of the respondent contain the statement of contribution of Provident Fund pertaining to the period 01.04.2003 to 31.03.2004, in respect of private respondents, namely Tvl.T.Ramani - S.No.516, N.Velan S.No.671, K.Perumal, P.Anbarasan and P.Jayakumar in S.Nos.762 to 764 and the said documents came into being, prior to the passing of the impugned order dated 04.01.2005. In the absence of any petition for reception of additional documents on the part of the petitioner/Management and that the said typed of documents dated 22.04.2013 came to be filed nearly after 8 years from the date of entertainment of the writ petition, this Court is not in a position to take cognizance of the same.
22. In the considered opinion of the Court, the point of reference is no longer res integra in the light of the decision in R.Ashok and Others v. Chairman, Tamil Nadu Generation and Distribution Corporation Ltd. and Others [(2013) 2 LLJ 562] (cited supra) and also the fact of dismissal of Special Leave Petition preferred against the said judgment. Therefore, this Court is of the view that the first respondent viz., Deputy Chief Inspector of Factories, Salem is having adjudicatory power under the provisions of the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1985.
23. In the result, this Writ Petition is dismissed, confirming the order of the first respondent in reference N.E.10287/2002 dated 04.01.2005. No costs. Interim order, if any, stands vacated and consequently, connected miscellaneous petition is closed.
[M.S.N., J.] [M.S., J.]
29.01.2018
Internet : Yes
jvm
To
The Deputy Chief Inspector of Factories,
Salem.
M.SATHYANARAYANAN, J.,
and
M.SUNDAR, J.
jvm
Order in
W.P.No.5156 of 2005
29.01.2018