w w w . L a w y e r S e r v i c e s . i n



The Management M/s. CIMMCO Birla Limited, Bharatpur, Through its Factory Manager v/s The State of Rajasthan, Through its Special Secretary-Cum-Labour Commissioner, Government of Rajasthan & Others


Company & Directors' Information:- CIMMCO LIMITED [Active] CIN = L28910WB1943PLC168801

Company & Directors' Information:- BIRLA CORPORATION LIMITED [Active] CIN = L01132WB1919PLC003334

Company & Directors' Information:- I T FACTORY (INDIA) PRIVATE LIMITED [Strike Off] CIN = U72200DL2002PTC114798

    Civil Writs No. 2766 of 1996

    Decided On, 01 June 2018

    At, High Court of Rajasthan Jaipur Bench

    By, THE HONOURABLE MR. JUSTICE ASHOK KUMAR GAUR

    For the Petitioner: Anita Agarwal, Advocate. For the Respondents: S.K. Singodia, Anshul Sharma, Advocates.



Judgment Text

The instant petition has been filed by the petitioner-employer challenging award dt 25.5.1995 (Annex.42) passed by the Labour Court, Bharatpur. The petitioner has also challenged the corrigendum dt. 14.4.1980 (Annex. 3), whereby the Government had amended the terms of reference in the original reference dt. 11.1.1979, raised u/Sec. 10 of the Industrial Disputes Act, 1947 (in short "the ID Act").

The Labour Court, Bharatpur in its award dt. 25.5.1995 has rejected the claim of 20 workmen namely Veerbal, Shivcharan, Laxman, Bihari, Mahaveer, Vijay, Kishan Singh, Radha Kishan, Khilkiya, Bishan, Golo, Vinay Singh, Guthro S/o Amar Singh, Bhagwan Singh, Pooran, Phaguni, Dharam Singh, Man Singh, Shankar, Madan & Nekram.

The claim in respect of 12 workmen namely Bhagwan Singh, Shibbo, Ramjilal, Tej Singh, Tota Ram, Bhim Singh, Lachman, Motiram, Man Singh, Jhamman, Deen Dayal & Baney Singh has been allowed and termination of their service has been found in violation of Sec. 25F of the ID Act.

The brief facts of the case are that the State Government in exercise of its power u/Sec. 10 of the ID Act vide order dt. 11.1.1979 made a reference to the Labour Court for adjudication as whether the employees listed in schedule were employees of the Contractor-Chhagan Lal and whether removal from service of such employees was legal and valid. The term of reference is quoted as hereunder:-

'HINDI'

The CIMMCO Kamgar Parishad, Bharatpur (hereinafter called as "the Union") submitted their statement of claim in the aforesaid reference and in the statement of claim, the Union made the present petitioner as Party No. 1 and the Contractor Chhagan Lal as Party No. 2.

The State Government amended the terms of reference by way of issuing a corrigendum dt. 14.4.1980 and the petitioner- CIMMCO Ltd. was added as party and reference was raised to the effect as whether CIMMCO Ltd. Being a principal employer was liable to take 35 workers of Contractor Chhagan Lal on work.

'HINDI'

The petitioner as well as the Contractor-Chhagan Lal submitted their reply to the statement of claim before the Labour Court. The Union filed affidavit of the employees. The petitioner also filed affidavit of three persons namely Shiv Singh, Ram Prasad & Ram Kishan.

The Union had filed an application dt. 13.10.1982 before the Labour Court making a request to summon the record from the employer-petitioner and specifically record relating to ESI deduction and relating to contract given to the Contractor were demanded. The petitioner filed reply to the said application and denied the requirement of summoning the record. The Labour Court by order dt. 09.12.1983 had rejected the application of the Union and further recorded a finding that ESI Card showing the deduction of ESI could be produced by the workman himself or could be summoned from the ESI office. It further recorded a finding that the workmen had not specified in clear terms as what kind of documents were required from the employer and as such finding the application to be baseless, the same came to be rejected.

The Union had again submitted an application dt. 21.4.1994 wherein they specifically asked for production of record in the nature of register maintained by the store Department for the year 1997-98, attendance register-muster roll of November 1977- October, 1978, record relating to ESI deduction showing the date of appointment of the workmen and the employees employed by the Contractor. It was specifically pleaded that the record was available with the petitioner and the same was required to be summoned. The Labour Court, Bharatpur vide order dt. 21.4.1994 dismissed the application filed by the Union as not pressed.

The Labour Court, Bharatpur after considering the record came to the conclusion that 20 workmen namely Veerbal, Shivcharan, Laxman, Bihari, Mahaveer, Vijay, Kishan Singh, Radha Kishan, Khilkiya, Bishan, Golo, Vinay Singh, Guthro S/o Amar Singh, Bhagwan Singh, Pooran, Phaguni, Dharam Singh, Man Singh, Shankar, Madan & Nekram were not entitled for any relief as these workmen had not filed their affidavits relating to their functioning for 240 days and further their status as employee also was not proved. The Labour Court recorded a finding that violation of Section 25F of the ID Act has not taken place in respect of these employees as they did not complete 240 days and as such neither the petitioner-Company nor the Contractor was liable to take them back on duty.

The Labour Court on the basis of the affidavit of 12 workmen namely Bhagwan Singh, Shibbo, Ramjilal, Tej Singh, Tota Ram, Bhim Singh, Lachman, Motiram, Man Singh, Jhamman, Deen Dayal & Baney Singh came to the conclusion that each of them had completed 240 days and these employees were not given notice or pay in lieu thereof and further they were not given the compensation, as per the requirement of Sec. 25F of the ID Act. The Labour Court has declared their termination of service to be illegal and has found them to be entitled for reinstatement and further with respect to their pay, liberty has been given to move an application 33(C)(2) of the ID Act.

The Labour Court has found the relationship of employer- employee established between the petitioner-company on the following factors:-

(i) Workmen were working in the factory premises.

(ii) Workmen were working as per instructions given by the Officers of the petitioner-company.

(iii) Workmen were carrying the goods/articles upto "Jugad".

The Labour Court has further recorded a finding that the workmen were not employees of the Contractor-Chhagan Lal and as such no liability was fastened on the Contractor.

Learned counsel for the petitioner has raised the following submissions to challenge the findings recorded in the impugned award:-

1. The Labour Court on the one hand found that the employees who had not filed their affidavit in support of their claim of having worked for 240 days with the petitioner-company, were not held entitled to any relief but on the other hand, the Labour Court arbitrarily approved the claim of 12 employees only on the basis of their affidavits and no other proof was available in support of their claim showing them to have worked for 240 days. The finding given by the Labour Court is self contradictory.

2. The claim of workman Khirkiya, Deendayal & Baney Singh was not allowed by the Labour Court on the ground that they had filed a suit against the Contractor for payment of their wages but other workmen like Chhitar Singh, Tej Singh, Ramji Lal & Tota Ram had also filed suit against the Contractor for payment of their wages and Labour Court ignored the affidavits and cross- examination of such employees and allowed their claim.

3. The Labour Court failed to take into account that for establishing relationship of employer & employee, documents like appointment letter, written contract, joining report, attendance register, leave record, ESI record, PF record & evidence of co- workers were required to be taken into consideration. In absence of such proof, Workmen could not be held entitled for any relief.

4. The Labour Court failed to take into consideration the license of the petitioner-company placed on record which was a registration certificate clearly showing Chhagan Lal as its Contractor who had 40 employees under him who were serving in the CIMMCO Ltd. The registration certificate was as per the provisions of the Contract Labour (Regulation and Abolition) Act, 1970 and as such the reference itself was not maintainable.

5. The Labour Court has misread the evidence of Ram Kishan Maheshwari produced on behalf of the petitioner-company and he nowhere stated or supported the claim of the employees that they had worked for 240 days or more in a year.

6. The adverse inference drawn by the Labour Court in regard to non submission of document, is bad in law because the applications of employees/Union were dismissed on two occasions and after rejection of their applications, the adverse inference ought to have been drawn against the Union.

7. The evidence of employees given by way of affidavit has been misread by the Labour Court as the employees tried to prove the fact of payment in presence of the Contractor along with the Officers of the petitioner-company/principal employer, the same fact cannot have any direct effect of supervision of the principal employer even when payment is made in their presence.

The learned counsel for the petitioner has relied upon the judgment of Delhi High Court in Shambhu & Anr. Vs. M/s. Sugan Drycleaners & Anr. reported in 2017 LLR 909, judgments of the Apex Court in Balwant Rai Saluja and Anr Vs. Air India Ltd. & Ors. reported in (2014) 9 SCC 407 and Mukand Ltd. Vs. Mukand Staff & Officers' Association reported in (2004) 10 SCC 407.

Per contra learned counsel for the respondents, Mr. S.K. Singodiya & Anshul Sharma, have supported the award passed by the Labour Court. Counsel for the respondents have submitted that evidence which was produced before the Labour Court clearly established the relationship of workmen and petitioner-company as employee & employer respectively. The relevant factors to establish the relationship, have been analysed and considered.

Counsel further submitted that Labour Court has found that certain persons who had not produced the affidavit of their working for 240 days, have been denied the relief and those persons who had filed the affidavit, their claims have been found to be justified and findings have been recorded in rightful manner to reach to the conclusion that there has been a violation of Section 25F of the ID Act as no notice or compensation was paid to the workman concerned.

Counsel have submitted that due to non production of relevant record, adverse inference has been drawn by the Labour Court and as such no interference is required by this Court.

Counsel have relied upon the judgments of the Apex Court in the case of Jasmer Singh Vs. State of Haryana reported in (2015) 4 SCC 458, Ajaypal Singh Vs. Haryana Warehousing Corporation reported in (2015) 6 SCC 321, Devinder Singh Vs. Municipal Council, Sanaur reported in (2011) 6 SCC 584, Bhuvnesh Kumar Dwivedi Vs. Hindalco Industries Ltd. reported in (2014) 11 SCC 85 & Harjinder Singh Vs. Punjab State Warehousing Corporation reported in (2010) 3 SCC 192.

I have heard learned counsel for the parties and perused the record.

This Court finds that the Labour Court while considering the evidence led by the petitioner by producing Shiv Singh, RamPrasad & Ram Kishan has drawn an inference that the record relating to allotment of workmen, attendance of workmen, contract being executed with the Contractor, were not produced by the employer. The Labour Court has drawn adverse inference on the ground of non production of record and as such it has been presumed that workmen had worked within the factory premises, as per the instructions of superiors, but the said finding has been erroneously recorded. It would be appropriate to quote the finding recorded by the Labour Court on the issue of adverse inference, which reads as under:-

'HINDI'

This Court finds that once the Labour Court had rejected the application filed by the Union for summoning the record vide its order dt. 9.12.1983 (Annex. 38) and further the application filed for summoning the record was dismissed as not pressed as per order dt. 21.4.1994 (Annex. 41), the Labour Court could not have drawn adverse inference against the employer-petitioner by holding that due to non production of record, adverse inference has to be drawn against the employer.

This Court finds that the Labour Court at Page 9 of the Award has recorded a finding that employer-petitioner had intentionally concealed the record and did not produce it intentionally and as such it would be presumed that the workmen were working with the employer-petitioner, the relevant finding of the Labour Court on adverse inference is reproduced hereunder:-

'HINDI'

This Court finds that the Labour Court in para 16 of its award has given a finding of establishing the relationship of employer and employee on the basis of following three factors:-

(i) Workmen were working in the factory premises.

(ii) Workmen were working as per instructions given by the Officers of the petitioner-company.

(iii) Workmen were carrying the goods/articles upto "Jugad".

The close scrutiny of record including the affidavits filed by the workmen, do not establish the fact that workmen were able to prove that they were under control of the petitioner-company in any manner.

The Apex Court in the case of Balwant Rai Saluga (supra) has laid down the test to ascertain the relationship of employer & employee and persons who are employed through Contractors. The relevant para 65 of the judgment is quoted hereunder:-

"65. Thus, it can be concluded that the relevant factors to be taken into consideration to establish an employer- employee relationship would include, inter alia,

(i) who appoints the workers;

(ii) who pays the salary/remuneration;

(iii) who has the authority to dismiss;

(iv) who can take disciplinary action;

(v) whether there is continuity of service; and

(vi) extent of control and supervision, i.e. whether there exists complete control and supervision.

As regards, extent of control and supervision, we have already taken note of the observations in Bengal Nagpur Cotton Mills case, the International Airport Authority of India case and the NALCO case."

This Court while considering the judgment of the Apex Court and keeping in mind the relevant factors as enumerated by the Apex Court, finds that such factors are not fulfilled in the instant case. The Union-workman has not produced before the Labour Court any appointment order, the proof of payment by the petitioner-company, the Authority to take Disciplinary Action & extent of control and supervision. This Court in view of the law laid down by the Apex Court finds that in para 16 of the award, the conditions for establishing the relationship between employer and employee have not been proved.

This Court finds substance in the submission of the learned counsel for the petitioner that only on the basis of the affidavits of the workmen, the presumption could not have been drawn by the Labour Court when there was no other cogent evidence either documentary or oral to prove the relationship of employer and employee.

This Court finds that the documents which were produced before the Labour Court i.e. registration of petitioner-company under the provisions of the Contract Labour (Regulation and Abolition) Act, 1970 (Annex. 7 filed with the present petition), it was clearly shown in the said registration that Chhagan Lal was the Contractor and he was to employ 40 persons for shifting the raw material. The Labour Court has also ignored the license granted to the Contractor Chhagan Lal u/Sec. 12 (2) of the Act 1970 (Annex. 8 filed with the present petition). The finding of the Labour Court that registration of Contractor has expired during the relevant period, such findings are not recorded as per the available record. The status of the Contractor has been treated as an employee on erroneous basis on the basis of deduction of ESI of Contractor at one point of time.

This Court further finds that the Labour Court in para 15 of the Award had rejected the submission of workmen-Union that license of the Contractor was not renewed during the period when workmen were employed and as such they ought to have been treated as employee of the petitioner-company. The L

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abour Court rejected the said argument of the workmen, however, the Labour Court has treated the Contractor as an employee by holding that even if Contractor had license under the provisions of the Act of 1970, he could not have been treated as employer but was an employee of the petitioner-Company. The said finding of the Labour Court is erroneous and contrary to the record. This Court finds that the Labour Court has not decided the claim of the workmen in proper manner and only on the basis of surmises, the findings have been recorded. The case law cited by the counsel for the respondents, relates to the issue of consequences of not following Sec. 25F of the ID Act. The Apex Court time and again has reiterated the principle that if there is a violation of Section 25F of the ID Act, the order of termination of a workmen is required to be set aside and in a given case, either reinstatement or lump-sum compensation in lieu of reinstatement, can be awarded. This Court finds that the term of reference, in the instant case, was in respect of first establishing the relationship of employer & employee initially between the contractor and the workmen and later on by way of a corrigendum, the relationship of employer and employee was to be examined between the petitioner-company viz-a-viz the Contractor. The case law cited by learned counsel for the respondents does not apply in the present facts of the case as none of the judgments cited relate to establishment of relationship of employer & employee, when workman is employed through a Contractor. Accordingly, the instant writ petition deserves to be allowed and is hereby allowed. The impugned award dt. 25.5.1995 is quashed and set aside. No order as to costs.
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