Supreme Court of India
DURGAPUR CASUAL WORKERS UNION & ORS.versusFOOD CORPORATION OF INDIA & ORS.
- Citation
- 2014 INSC 848
- Decided
- 9 December 2014
- Disposal
- Appeal(s) allowed
- Bench
- S MUKHOPADHAYA
Holding
In the absence of any plea challenging the legality of the initial appointments, the High Court could not set aside the Tribunal’s award, and the award directing absorption of the casual workers on the ground of unfair trade practice stands.
Summary
The Food Corporation of India (FCI) closed its rice mill and thereafter employed 49 former contract workers as casual daily‑wage employees. The workers sought regularisation, alleging that their continued casualisation constituted an unfair labour practice under item 10 of the Fifth Schedule of the Industrial Disputes Act. The Central Government Industrial Tribunal awarded their absorption, a decision affirmed by a High Court Single Judge but set aside by the Division Bench of the Calcutta High Court. On appeal, the Supreme Court held that the Corporation had never pleaded that the initial appointments were illegal, so the High Court could not overturn the Tribunal’s award. The Court affirmed that the finding of unfair trade practice justified absorption under Section 25H and that Articles 14 and 16 of the Constitution do not bar such relief in a private establishment. Consequently, the appeal was allowed, the High Court judgment was set aside, and the Tribunal’s award was restored.
Issues considered
- Whether the validity of the initial appointments of the workers can be challenged in the absence of a specific pleading before the Tribunal.
- Whether the workers are entitled to absorption on the basis of the Tribunal’s finding of unfair trade practice under item 10 of the Fifth Schedule.
- Whether Articles 14 and 16 of the Constitution apply to appointments and re‑employment in a private industrial establishment.
- Whether the High Court was empowered to set aside the Tribunal’s award despite the finding of unfair trade practice.
Legislation cited
- Industrial Disputes Act, 1947s. 25F, s. 25H, s. 25J, s. 25U, s. 2(j), s. 2(k), s. 2(ka), s. 2(ra)
- MRTU and PULP Acts. 30(1)(b), s. 32
Subjects
industrial disputesunfair labour practiceregularisationcasual workersre‑employmentSection 25HFifth ScheduleArticles 14 and 16absorptioncontract workers
Judgment
[2014] 12 S.C.R. 377
DURGAPUR CASUAL WORKERS UNION & ORS. A
v.
FOOD CORPORATION OF INDIA & ORS.
(Civil Appeal No. 10856 of 2014)
DECEMBER 09, 2014
B
[SUDHANSU JYOTI MUKHOPADHAYA AND
PRAFULLA C. PANT, JJ.]
Industrial Disputes Act, 1947:
s. 25H, item 10, Part I, Fifth Schedule - Re-employment
c
of retrenched workmen - Contract workers under the
contractor in rice mill of the Corporation - Closure of rice mill
- Termination of contract system - Said workmen employed
by the Corporation as casual employees on daily wage basis
- Workmen seeking regularization of services - Award by the· D
tribunal to absorb the causal workmen holding that there was
unfair trade practice on the part of the Management of the
Corporation - Upheld by the Single Judge, however, set aside
by the Division Bench of the High Court - On appeal, held:.
No plea was taken by the Corporation either before the State E
Government or before the Tribunal that the initial appointment
of workmen were illegal or they were appointed through back
door means - Thus, in absence of any such plea, the Division
Bench of the High Court not justified in holding that initial.
appointments of workmen were in violation of Arts. 14 and 16 F
and in denying the benefit to which the workmen were entitled
- Tribunal gave a specific finding of unfair trade practice on
the part of the Management of the Corporation - Having
accepted that there was unfair trade practice, the Division
Bench erred in interfering with the award - Constitution of G
India, 1950 - Arts. 14 and 16.
s. 2(ka) - Industrial establishment or undertaking - Held:
377 H
378 SUPREME COURT REPORTS (2014] 12 S.C.R.
A Not only includes the State Public Undertakings, the
Subsidiary Companies and Autonomous bodies owned or
control by the State Government or Central Government but
also the private industries and undertakings - Act applies to
all such industries - If any unfair labour practice is committed
8 by any of these industrial establishment, labour court/tribunal
would decide the .same.
' practice - Appointment
s. 20), 2(k), 2(ra) -' Unfair labour
in the services of the 'State' and in private establishment or .
undertaking - Arts. 14 and 16, when attracted - Held: Arts.
C 14 and 16 are attracted in the matter of appointment in the
services of the 'State' but not in case of appointment in private
establishment or undertaking - However, undertaking of the
Government, cannot justify its illegal action including unfair
labour practice nor can ask for different treatment on account
D · of Arts. 14 and 16 - Constitution of India, .1950 - Arts. 14 and
16.
Secretary, State of Kamataka and others v. Umadevi (3)
and others 2006 (3) SCR 953:(2006) 4 SCC 1; M.P.
E Administration v. Tribhuban 2007 (4) SCR.918:(2007) 9 SCC
.748; Maharashtra State Road transport and another v.
Casteribe Rajya Parivahan Karmchari Sanghatana (2009) 8
SCC 556; Ajaypal Singh v. Haryana Warehousing
Corporation 2014 (13) SCALE 636 - referred.
. .
F Case Law Reference·:
2006 .(3) SCR 953 Referred to Para6,16
2007 (4) SCR 918 Referred to Para 17
G (2009) 8 sec 556 Referred to Para 18
2014(13) SCALE 636 · ;Referretl to Para 19,21
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
10856 of 2014.
H
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 379
. OFINDIA
From the Judgment & Order dated 25.02.2009 of the High A
Court of at Calcutta in F.M.A. No. 2345 of 2005.
Guru Krishna Kumar, Subhasish Bhowmick, Niti Luthra,
S.C. Patel for the Appellants.
Y. Prabhakara Rao for the Respondents. B
The Judgment of the Court was delivered by
SUDHANSU JYOTI MUKHOPADHAYA, J. 1. Leave
granted. c
2. This appeal has been preferred by the appellant-
Durgapur Casual Workers Union and others (hereinafter
referred to as, 'the workmen' for short) against the judgment
and order dated 25th February, 2009 passed by the Division
Bench of the High Court at Calcutta in F.M.A. No.2345 of 2005 D
(C.A.N. 8685 of 2007 and C.A.N.4726 of 2008). By the
impugned judgment, the High Court allowed ·the appeal
preferred by the respondent-Food Corporation of India
(hereinafter referred to as, 'the Corporation' for short) and set
aside the Award dated 9th June, 1999 passed by the Central E
Government Industrial Tribunal (hereinafter referred to as, 'the
Tribunal' for short) as affirmed by the learned Single Judge of
the High Court at Calcutta.
3. The factual matrix of the case is as follows: F
The Corporation had long back setup a rice mill in the
name and style of Modern Rice Mill at Durgapur and it had
been handed to successive contractors for running the same.
The concerned workmen, forty nine in numbers, had been
working as contract labours under the contractors in the rice G
mill. The last contractor was Mis Civicon. The contract system
was terminated arid the rice mill was closed in the year 1990-
1991. Thereafter, the concerned workmen were directly
employed by the Corporation in June, 1991 as casual
employees on daily wage basis in the Food ·Storage Depot at H
380 SUPREME COURT REPORTS [2014] 12 S.C.R.
A Durgapur for performing the jobs of sweeping godown and
wagon floors, putting covers on infested stocks for fumigation
purpose, cutting grass, collections and bagging of spillage from
godowns/wagons etc.
There being an industrial dispute between the workmen
8
and the Corporation regarding the regularisation of services of
the workmen, the Government of India, Ministry of Labour in
exercise of powers conferred on them by clause (d) of sub
Section (1) and Sub Section (2A) of Section 10 of the Industrial
.C Disputes Act, 1947 (hereinafter referred to as, 'the Act' for
short) referred the following dispute to the Tribunal for
adjudication vide Ministry's order ,No.L-22012/348/95-IR (C.11)
dated 18th July, 1996. '
SCHEDULE
D
"Whether the demand of Durgapur Casual Workers Union
for absorption of 49 casual workmen as per list enclosed
by the management of FCI, Durgapur is justified? If not,
what relief they are entitled to?"
E 4. The said reference was registered as Reference No.21
of 1996 before the Tribunal. The Tribunal on appreciation cif
evidence brought on record by the Management of the
Corporation and the workmen and hearing the parties
answered the reference in favour of the workmen by Award
F dated 9th June, 1999 and held that con'tinued casualization of
service of workmen amounts to unfair labour practice as
defined in item no.10 in part I of the Fifth Schedule of the Act
and that social justice principle demands order of absorption
and thereby directed the Management to absorb 49 casual
G workmen as per list. .
5. The Corporation being aggrieved preferred a Writ
Petition being W.P.No.21368 (W) of 1999 before the High
Court at Calcutta. The learned Single Judge of the High Court
H on hearing the parties and taking into consideration the
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 381
OF INDIA [SUDHANSU JYOTI MUKHOPADHAYA, J.]
evidence on record, dismissed the writ petition by judgment and A
order dated 18th February, 2005 and affirmed the Award
passed by the Tribunal.
6. Aggrieved by the aforesaid judgment of the learned
Single Judge, the Corporation preferred an appeal before the B
Division Bench of High Court at Calcutta. One of the grounds
taken was that the appointments of the workmen were backdoor
appointments. The workmen were working under the contractor
whose· services as terminated in the year 1990-1991 and
thereafter on their demand, the workmen were engaged as
casual workmen under the Corporation in June, 1991. It was C
contended that in view of Constitution Bench judgment of this
Court in Secretary, State of Karnataka and others v.
Umadevi (3) and others, (2006) 4 SCC 1 and decisions
rendered.by this Court in other cases, regularization of service
cannot be allowed if it violates the basic principles of Articles 0
14 and 16 of the Constitution of India. The Division Bench of
the High Court by impugned judgment dated 25th February,
2009 while setting aside the award as affirmed by the learned .
Single Judge held as follows:
D
"Hence, ;(appears that Appointing Authority has every
right to appoint either in substantive capacity or in casual
manner and/or ad-hoc. It is also a settled legal position
of law that regularization/absorption of casual appointee/
ad-hoc appointee in a permanent post is not other mode E
of appointment ...... "
"In the instant case it appears that the workmen, illegal
appointees, moved the writ application in the year 1994
and got an order of status quo to maintain their service . ·
condition passed by the Writ Court and as such,. service F
of the workmen since 1994 till this date is covered by the
order of the Court, which is accordingly attracted by the
said riders of para 53 as quoted, to negative their claim."
"Having regard to the aforesaid judgments of the Apex G
382 SU.f>Rl;ME CQURT REPORTS (2014] 12 S.C.R.
A Court, now the law .has got its firm root being the law of
the land that no regularization even in respect of a
workman .under Industrial Dispute Act .is permissible
.unless the contingencies of the law is satisfied, namely,
appointment following the rule, appointment in a post and
8 appointment for .a long continuous period in the angle .of
Secretary, State .of Kamataka and Ors. v. Uma Devi (3)
.and .Ors. {supra). This law of the land was existing and.if
has beeQ re-echoed 13.nd reviewed in Secretary, State of
Kamataka· and Ors. v. Vma Devi (3) and Ors. (supra)."
"In the iQstaQt case, frorn the .pecision ,under challenge
. in the writ applicatio17 passed by the learned Tribunal
below, it appears that the Tribunal did not answer by any
findings as .to 1why .workmen were Jegal/y entitled .to be
absorbed permanently on considering the settled legal
p position of law that absorption and/or regularization are
not ,the mode of permanent appointment. Even the
reasoning as advanced, namely, "unfair labour practice';
.it also does not support tf)e decision to regularize in
absence of any statutory provision for regularization of
.E :service of th.e ~orkmen ,under thp four corners of
the Industrial Dispute A.ct, 1947. Qn the .other
har;id, Industrial Dispqte Aqt provides under Chapter ..vc
as ,already .quoted above· by Section 25~1.J, a penal
cons.equences for imprisonment .and fine.· The ·very
F .essence arid coocept .of un.(air Jabour praetice)n 1the
angle and a.nvil oi ;S,ection ·.25-T and 25-.Uis .th.at in
theindustrial·r;ector there is complete bar to appoint ·the
ca.sual.app,ointee.s for a continuous period with the objeqt
to deprjv,e ·them the status ,and privileges of permanent
'G workmen an.d ·.as a coercive measw:es to avoi:J su-ch
contingency, law has been framed.in a negative angle
restraining/prohibiting such ·unfair labour practice ·Under
the pain of punishment wit[I i((IPri.$Of)ment .fqr ,il term in
'Section 25l:J. Henc.e, .,even Jf any unfair labour practice
is ,assumed though•it requires to be proved by leading
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 383
OF INDIA [SUDHANSU JYOTI MUKHOPADHAYA, J.]
the evidence that such appointment.as casual appointee A
for a continuous period was with .the mens rea to deprive
the workmen from their permanent status and privileges,
the award prima facie speaks an "error of law" due· to a
decision applying principle of "unfair labour practice" for
"permanent absorption" and it also covers the field of B .
~without jurisdiction" principle ..... "
7. Learned counsel appearing on behalf of the appellants ·
submitted that in absence of any pleading made by the
Corporation before the Tribunal about legality of initial 'C
appointment of appellants, it was not open to the Corporation
to raise such question before the Division Bench of the High
Court. The Division Bench .of the High Court was also not
justified in giving any finding with regard to the initial
appointment of the workmen, in absence of any issue
suggested or framed by the Tribunal. D
8. On the other hand, the respondents have taken a similar
plea as was taken before the High Court that the initial
appointments of the workmen were backdoor appointments
and hence.the regularization is not permissible. E
9. We have heard the rival contention of the parties and
perused t~e .record.
10. The Industrial Disputes Act, 1947 ·is .a beneficial
legislation enacted with an object for the investigation and ·F
settlement of.industrial disputes and for a certain other benefits.
Section 2 0) of the Act defines industry as ,follows:
"2(j) "industry" means any busines_s, ,trade,
undertaking, manufacture .or calling of employers aad G
includes any cal/mg, seNice, employment, handic;raft, ·or
industrial occupation or avocation of workmen."
The Industrial dispute is defined under Section 2(k) ,as
follows:- ·
H
384 SUPREME COURT REPORTS [2014] 12 S.C.R.
A "2(k) "industrial dispute" means any dispute or difference
between employers and employers, or between ·
employers and workmen, or between workmen and
workmen, which is connected with the employment or
non-employment or the terms of employment or with the
B conditions of labour, of any person."
Section 2(ka) of the said Act defines "industrial
establishment or undertaking" and reads as follow:
"(ka) "industrial establishment or undertaking" means an
c establishment or undertaking in which any industry is
carried on:
Provided that where several activities are carried on in
· an establishment or undertaking anc! only one or some
D of such activities is or are an industry or industries,
then,- ·
(a) if any unit of such establishment or undertaking
carrying on any activity, being an industry,· is severable
from the other unit or units of such establishment or
E undertaking, such unit shall be deemed to be a separate
industrial establishment or undertaking;
(b) if the predominant activity or each of the predominant
activities carried on in such establishment or undertaking
F or any unit thereof is an industry and the other activity or
each of the other activities carried on in such
establishment or undertaking or unit thereof is not
severable from and is, for the purpose of carrying on, or
aiding the carrying on of, such predominant activity or
G activities, the entire establishment or undertaking or, as
the case may be, unit thereof shall be deemed to be an
industrial establishment or undertaking;"
"Unfair labour practice", as defined under Section 2(ra)
means any of the practices specified in the Fifth
H Schedule.
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 385
OF INDIA[SUDHANSU JYOTI MUKHOPADHAYA, J.]
11. The industrial establishment or undertaking as defined A
in the Act not only includes the State Public Undertakings, the
Subsidiary Companies set up by the Principal Undertaking and
Autonomous bodies owned or control by the State Government
or Central Government but also the private industries and
undertakings. B
Industrial Disputes Act is applicable to all the industries as
defined under the Act, whether Government undertaking or
private industry. If any unfair labour practice is committed by
any industrial establishment, whether Government undertaking C
or private undertaking, pursuant to reference made by the
appropriate Government the Labour Court/Tribunal will decide
the question of unfair labour practice.
12. In the matter of appointment in the services of the
'State', including a public establishment or undertaking, Articles D
14 and 16 of the Constitution of India are attracted. However,
Articles 14 and 16 of the Constitution of India are not attracted
in the matter of appotntment in a private establishment or
undertaking.
E
13. An undertaking of the Government, which comes within
the meaning of industry.or its establishment, cannotjustify its
illegal action including unfair labour practice nor can ask for
different treatment on the ground that public undertaking is
guided by Articles 14 and 16 of the Constitution of India and
the private industries are hot guided by Articles 14 and 16 of F
the Constitution of India.
14. In the light of above discussion, in the present case
the issues that are to be determined are as follows:
G
(1) Whether an issue relating to the validity of initial
appointment can be raised in absence of any specific
pleading or reference~
(2) The Tribunal having held, as affirmed by the High Court
that the respondent corporation had committed unfair trade H
38'6 SUPREME COURT REPORTS [2{)14] 1·2 S.C.R.
A practice against the workmen depriving them of statt1s and
privileges of permanent workmen; whether the workmen
were entitled for relief of absorption?
15. Before deciding the issues, it is necessary to notice
B the relevant decisions of this Court regarding regularization of
service/absorption in the Government Service or its
undertakings in the light of Articles 14 and 16 of the Constitution
of India.
16. In Uma Devi (3) Constitution Bench of this Court while
c observing that casual/temporary employees do not have any
right to regular or permanent employment held as follows:
"43. Thus, it is clear that adherence· to the rule of equality
in public employment is a basic feature of our
D Constitution and since the rule of law is the core of our
Constitution, a court would certainly be disabled from
a
passing an order upholding violation of Article 14 or in
ordering the overlooking of the need to comply with the
requirements of Article 14 read with Article 16 of the
Constitution. Therefore; consistent with the scheme for
public employment, this Court while laying down the law,
has necessarily to hold that unless the appointment is
in· terms of the relevant rules and after a proper
competition among qualified persons, the same would
not confer any right on the appointee. If it is a contractual
F appointment, the appointment comes to an end at the
end of the contract, if it were an engagement or
appointment on daily wages or casual basis, the same
would come to an end when it is discontinued. Similarly,
a temporary employee could not claim to be made
G permanent on the expiry of his term of appointment. It has
.a/so to be clarified that merely because a temporary
"employee or a casual wage worker is continued for a time
beyond the term of his appointment, he would not be
entitled to be absorbed in regular service or made
H permanent, merely on the strength of such continuance,
•
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 387
OF INDIA[SUDHANSU JYOTI MUKHOPADHAYA, J.)
if the original appointment was not made bf following a A
due process of selection as envisaged by the relevtiflt
rules. It Hi not open to the court to prevent regular
recruitment at the instance of temporary etnployees
whose period of employment has come to- an end or of
ad hoc employees who by the very nature of their B
appointment, do not acquire any right. The High Courts
acting under Article 226 of the Constitution, should not
ordinarily issue directions for absorption, regularisation,
or permanent continuance unless the recruitment itself
was made regularly and in terms of the constitutional c
scheme. Merely because an employee had continued
under cover of an order of the court, which we have
described as "litigious employmenf' in the earlier part of
the judgment, he would not be entitled to any right to be
absorbed or made permanent in the service. In fact, in
0
such cases, the High Court may not be justified in
issuing interim directions, since, after all, if ultimately the
employee approaching it is found entitled to relief, it may
be possible for it to mould the relief in such a manner
thet ultimately no prejudice will be caused to him, whereas E
an interim direction to continue his employment would
hold up the regular procedure for selection or impose on
the State the burden of paying an employee who is really
not required. The courts must be careful in ensuring that
they do not interfere unduly with the economic
arrangement of its affairs by the State or its F
instrumentalities or lend themselves the instruments to
facilitate the bypassing of the constitutional and statutory
mandates." ·
45. While directing that appointments, temporary or G
casual, be regularised or made permanent, the courts
are swayed by the fact that the person concerned has
worked for some time and .in some cases for a
considerable length of time. It is not as if the person who
accepts an engagement either temporary or casual in H
388 SUPREME COURT REPORTS (2014] 12 S.C.R.
A nature, is not aware of the nature of his employment. He
accepts the employment with open eyes. It may be true
that he is not in a position to bargain-not at arm's
length-since he might have been searching for some
employment so as to eke out his livelihood and accepts
B whatever he gets. But on that ground alone, it would not
be appropriate to jettison the constitutional scheme of
appointment and to take the view that a person who has
temporarily or casually got employed should be directed
to be continued permanently. By doing so, it will be
c creating another mode of public appointment which is not
permissible. If the court were to void a contractual
employment of this nature on the ground that the parties
were not having equal bargaining power, that too would
not enable the court to grant any relief to that employee.
A total embargo on such casual or temporary
D
employment is not possible, given the exigencies of
administration and if imposed, would only mean that
some people who at least get employment temporarily,
contractually or casually, would not be getting even that
employment when securing of such employment brings
E at least some succour to them. After all, innumerable
citizens of our vast country are in search of employment
and one is not compelled to accept a casual or temporary
employment if one is not inclined to go in for s/Jch an
employment. It is in that context that one has to proceed
F on the basis that the employment was accepted fully
knowing the nature of it and the consequences flowing
from it. In other words,, even while accepting the
employment, the person concerned knows the nature of
his employment. It is not an appointment to a post in the
G real sense of the term. The claim acquired by him in the
'post in which he is temporarily employed or the interest
in that post cannot be considered to· be of such a
magnitude as to enable the giving up of the procedure
established, for making regular appointments to
H available posts in the services of the State. The argument
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 389
OF INDIA [SUDHANSU JYOTI MUKHOPADHAYA, J.]
that since one has been working for some time in the post, A
it will not be just to discontinue him, even thoug/1 he was
aware of the nature of the employment when he first took
it up, is not one that would enable the jettisoning of the
procedure established by law for public employment a_nd
would have to fail when tested on the touchstone of B
constitutionality and equality of opportunity enshrined in
. Article· 14 of the Constitution."
However, in respect of irregular appointments of duly
qualified persons working for more than 10 years, this Court C
observed:
"53. One aspect needs to be clarified. There may
be cases where irregular appointments (not illegal
appointments) as explained in S. V. Narayanappa 11,
R.N. Nanjundappa12 and B.N. NagarajanB and referred b
to in para 15 above, of duly qualified persons in duly
sanctioned vacant posts might have been made and the
employees have continued to work for ten years or more
but without the intervention of orders of the courts or of
fFibunals. The question of regularisation of the services E
of such employees may have to be considered on merits
in the light of the principles settled by this Court in the
cases above-referred to and in the light of this judgment.
In that context, the Union of India, the State Governments
and their instrumentalities should take steps to regularise F
as a one-time measure, the services of such irregularly
appointed, who have worked for ten years or more in duly
sanctioned posts but not under cover of orders of the
courts or of tribunals and should further ensure that
regular recruitments are undertaken to fill those vacant G
sanctioned posts that require to be filled up, in cases
where temporary employees or daily wagers are being
now employed. The process must be set in motion within
six months from this date. We also clarify that
regularisation, if any already made, but not sub judice,
H
390 SUPREME COURT REPORTS [2014) 12 S.C.R.
A need not be reopened based on this judgment, but there
should be no further bypassing of the constitutional
requirement and regularising or making permanent,
those not duly appointed as per the constitutional
·scheme.
B
17. This Court in the case of M.P. Administration v.
Tribhuban, (2007) 9 SCC 748 while taking into aGcount the
doctrine of public employment involving public money and
several other facts observed as follows:
c "6. The question, however, which arises for consideration
is as to whether in a situation of this nature, the learned
Single Judge and consequently the Division Bench of the
Delhi High Court should have directed reinstatement of
the respondent with full back wages. Whereas at one
D point of time, such a relief used to be automatically·
granted, but keeping in view several other factors and in
particular the doctrine of public employment and
involvement of the public money, a change in the said
trend is now found in the recent decisions of this Court.
E This Court in a large number of decisions in the matter
of grant of relief of the kind distinguished between a daily
wager who does not hold a post and a- permanent
employee. It may be that the definition of "workman" as
contained in Section 2(s) of the Act is wide and takes
.F within its embrace all categories of workmen specified
therein, but the same would not mean that even for the
purpose of grant of relief in an industrial dispute referred
for adjudication; application of constitutional scheme of
equality adumbrated under Articles 14 arid 16 of the
Constitution of India, in the light of a decision of a
G
Constitution Bench of this Court in Secy., State of
Karnataka v. Umadevi (3) and other relevant factors
pointed out by the Court in )a catena of decisions shall
not be taken into consideration.
H 7. The nature of appointment, whether there existed any
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 391
OF INDIA [SUDHANSU JYOTI MUKHOPADHAYA, J.)
sanctioned post or whether the officer concerned had any A
authority to make appointment are relevant factors. (See
M.P. Housing Board v. Manoj Shrivastava (2006)2 SCC
702, State of M.P. v. Arjunlal Rajak (2006)2 SCC 711 and
M.P. State Agro Industries Development Corpn. Ltd. v.
s.c. Pandey, 2006 (2) sec 716.) s
18. The effect of Constitution Bench decision in Uma Devi
(3), in case of unfair labour practice was considered by this
Court in Maharashtra State Road Transport and another
v. Casteribe Rajya Parivahan Karmchari Sanghatana C
(2009) 8 SCC 556. In the said case, this Court held that
Umadevi's case has not over ridden powers of Industrial and
Labour Courts in passing appropriate order, once unfair labour
practice on the part of employer is established. This Court
observed and held as follows:
D
"34. It is true that Dharwad Distt. PWD Literate Daily
Wages Employees' Assn. V: State of Karnataka, (1990) 2
sec 396 arising out of industrial adjudication has been
considered in State of Kamataka v .Umadevi (3), (2006)4
SCC 1 and that decision has been held to be not laying E
down the correct law but a careful and complete reading
of the decision in Umadevi (3) leaves no manner of
doubt that what this Court was concerned in Umadevi (3)
was the exercise of power by the High Courts under
Article 226 and this Court under Article 32 of the F
Constitution of India in the matters of public employment
where the employees have been engaged as contractual,
temporary or casual workers not based on proper
selection as recognised by the rules or procedure and
yet orders of their regularisation and conferring them G
status of permanency have been passed.
35. Umadevi (3) is an authoritative pronouncement
for the proposition that the Supreme Court (Article 32)
and the High Courts (Article 226) should not issue
directions of absorption, regularisation or permanent H
392 SUPREME COURT REPORTS [2014] 12 S.C.R.
A continuance of temporary, contractual, casual, daily wage
or ad hoc employees unless the recruitment itself was
made regularly in terms of the constitutional scheme.
36. Umadevi (3) does not denude the Industrial and
Labour Courts of their statutory power under Section 30
B
read with Section 32 of the MRTU and PULP Act to order
permanency of the workers who have been victims of
unfair labour practice on the part of the employer under
Item 6 of Schedule IV where the posts on which they have
been working exist. Umadevi (3) cannot be held to have
c · overridden the powers of the Industrial and Labour Courts
in passing appropriate order under Section 30 of the
MRTU and PULP Act, once unfair labour practice on the
part of the employer under Item 6 of Schedule IV is
established."
D
"47. It was strenuously urged by the learned Senior
Counsel for the Corporation that the Industrial Court
having found that the Corporation indulged in unfair
labour practice in employing the complainants as casuals
E on piece-rate basis, the only direction that could have
been given to the Corporation ·was to cease and desist
from indulging in such unfair labour practice and no
direction of according permanency to these employees
could have been given. We are afraid, the argument
F ignores and overlooks the specific power given to the
Industrial/Labour Court under Section 30(1)(b) to take
affirmative action against the erring employer which as
noticed above is of wide amplitude and comprehends
within its fold a direction to the employer to accord
permanency to the employees affected by such unfair
G'
labour practice."
19. Almost similar issue relating to unfair trade practice
by employer and the effect of decision of Umadevi (3) in the
grant of relief was considered by this Court in Ajaypal Singh
H v. Haryana Warehousing Corporation in Civil Appeal
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 393
. OF INDIA [SUDHANSU JYOTI MUKHOPADHAYA, J.)
No.6327 of 2014 decided on 9th July, 2014. In the said case, A
this .Court observed and held as follows:
"20. The provisions of Industrial Disputes Act and the
powers of the Industrial and Labour Courts provided
therein were not at all under consideration in Umadevi's
8
case. The issue pertaining to unfair labour practice was
neither the subject matter for decision nor was it decided
in Umadevi's case.
21. We have noticed that Industrial Disputes Act is made
for settlement of industrial disputes and for certain other C
purposes as mentioned therein. It prohibits unfair labour
practice on the part of the employer in engaging
employees as casual or temporary employees for a long
period without giving them the status and privileges of
permanent employees. D
22. Section 25F of the Industrial Disputes Act, 1947
stipulates conditions precedent to retrenchment of
workmen. A workman employed in any industry who has
been in continuous service for not less than one year
under an employer is entitled to benefit under said E
provision if the employer retrenches workman. Such a
workman cannot be retrenched until he/she. is given one
month's notice in writing indicating the reasons for
retrenchment and the period of notice has expired, or the
workman has been paid in lieu of such notice, wages for F
the period of the notice apart from compensation which
shall be equivalent to fifteen days' average pay for every
completed year of continuous service or any part thereof
in excess of six months. It also mandates the employer
to serve a notice in the prescribed manner on the G
appropriate Government or such authority as may be
specified by the appropriate Government by notification
in the Official Gazette.
If any part of the provisions of Section 25F is violated and H
394 SUPREME COURT REPORTS [2014] 12 S.C.R.
A the employer thereby, resorts to unfair trade practice with
the object to deprive the workman with the privilege as
provided under the Act, the employer cannot justify such
an action by taking a plea that the initial appointment of
the employee was in violation of Articles 14 and 16 of the
B Constitution of India.
23. Section 25H of the Industrial Disputes Act relates to
re-employment of retrenched workmen. Retrenched
workmen shall be given preference over other persons if
. the employee proposes to employ any person.
c
24. We have held that provisions of Section 25H are in
conformity with the Articles 14 and 16 of the Constitution
of India, though the aforesaid provisions (Articles 14 and
16) are not attracted in the. matter of re-employment of
D retrenched workmen in a private industrial establishment
and undertakings. Without giving any specific reason to
that effect at the time of retrenchment, it is not open to
the employer of a public industrial establishment and
undertaking to take a plea that initial appointment of such
.E workman was made in violation of Articles 14 and 16 of
the Constitution of India or the workman was a backdoor
appointee.
25. It is always open to the employer to issue an order.of
"retrenchment" on the ground that the initial appointment
F of the workman was not in conformity with Articles 14 and
16 of the Constitution of India or in accordance with rules.
Even for retrenchment on such ground, unfair labour
practice cannot be resorted and thereby workman cannot
be retrenched on such ground without notice, pay and
. G other benefits in terms of Section 25F of the Industrial
Disputes Act, 1947, if continued for more than 240 days
in a calendar year.
26. However, in other cases, when no such plea is taken
by the employer in the order of retrenchment that the
H
DURGAPUR CASUAL WORKERS UNION v. FOOD CORP. 395
OF INDIA [SUDHANSU JYOTI MUKHOPADHAYA, J.]
workman was appointed in violation of Articles 14 and 16 A
of the Constitution of India or in violation of any statutory
rule or his appointment was a backdoor appointment,
while granting relief, the employer cannot take a plea that
initial appointment was in violation of Articles 14 and 16
of the Constitution of India, in absence of a reference B
made by the appropriate Government for determination
of question whether the initial appointment of the
workman was in violation of Articles 14 and 16 of the
Constitution of India or statutory rules. Only if such
reference is made, a workman is required to lead c
evidence to prove that he was appointed by following
procedure prescribed under the Rules and his initial
appointment. was legal."
20. In the present case, it is admitted that the workmen had
been working as contract labours under the contractor in the D
rice mill of the Corporation. The contract system was terminated
and the rice mill was closed in the year 1990-1991. The effect
was termination of services of the workmen. In that view of the
matter, they were entitled for re-employment when the employer
proposed to take into his employment any person, in view of E
Section 25H, which reads as follows:
"Section 25H. Re-employment of retrenched
workmen.- Where any workmen are retrenched, and the
employer proposes to take into his employ any persons,
he shall, in such manner as may be prescribed, give an F
opportunity to the retrenched workmen who are citizens
of India to offer themselves for re-employment and such
retrenched workman who offer themselves for re-
employment shall have preference over other persons."
Under Section 25H the retrenched workman who offer G
themsel.ves for employment shall have preference over other
persons. It was for the said reason the workmen were employed
by the Corporation in June, 1991.
21. This Court in Ajaypal Singh held that the provisions H
396 SUPREME COURT REPORTS [2014] 12 S.C.R.
A of Section 25H are in conformity with Articles 14 and 16 of the
Constitution of India, though, the aforesaid provisions (Articles
14 and 16) are not attracted in the matter of re-employment of
retrenched workmen in private industrial establishment and
undertakings. In that view of the matter it can be safely held that
B the workmen who were retrenched, were rightly taken in the
services of Corporation. Admittedly, no plea was taken by the
Corporation either before the State Government or before the
Tribunal that the initial appointment of workmen were illegal or
they were appointed through back door means.
C 22. In this background, we are of the view that it was not
open to the Division Bench of the 'High Court, particularly in
absence of any such plea taken by the Corporation before the
Tribunal to come to a finding of fact that initial appointments of
workmen were in violation of Articles 14 and 16 of the
D Constitution of India, nor it was open to the High Court to deny
the benefit to which the workmen were entitled under. item 1O
of Part I of the Fifth Schedule of the Act, the Tribunal having
given specific finding of unfair trade practice on the part of the
Management of the Corporation.
E 23. Having accepted that there was unfair trade practice,
· it was not open to the Division Bench of the High Court to
interfere with the impugned award.
24. For the reasons aforesaid, we set aside the impugned
F judgm'ent dated 25th February, 2009 passed by the Division
Bench of the High Court at Calcutta in F.M.A. No.2345 of 2005
(C.A.N.8685 of 2007 and C.A.N.4726 of 2008). Award dated
9th June, 1999 passed by the Tribunal in Reference No.21 of
1996 as affirmed by the learned Single Judge by order dated
18th February, 2005 in W.P. No.21368 (W) of 1999 is upheld.
G The respondent-Corporation is directed to implement the Award
from its due date as ordered by the Tribunal. The appeal is
allowed with aforesaid observations and directions. No costs.
Nidhi Jain Appeal allowed.
H
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