Supreme Court of India
MOHAN SINGH & ORS.versusTHE CHAIRMAN RAILWAY BOARD & ORS.
- Citation
- 2015 INSC 539
- Decided
- 3 August 2015
- Disposal
- Appeal(s) allowed
- Bench
- VIKRAMAJIT SEN
Holding
The Moradabad Division premises constitute a factory, making the canteen a statutory canteen under Section 46 of the Factories Act, 1948, and the Railway Board must regularise the canteen workers in accordance with established principles.
Summary
The appellants were canteen workers at the Moradabad Division of the Northern Railway who claimed that their canteen should be treated as a statutory canteen under the Factories Act, 1948 and that their services should be regularised. The respondents argued that the canteen was a non‑statutory, non‑recognised facility because the premises did not constitute a "factory" within the meaning of Section 2(m) of the Act. The Supreme Court examined the definition of "factory" and "premises" and held that the ORM office and its precincts, where over 1,000 workers are employed and manufacturing activities such as wagon repair and signal maintenance are carried out, satisfy the statutory criteria of a factory. Consequently, the canteen fell within the ambit of Section 46 of the Factories Act and must be treated as a statutory canteen, making its staff railway servants. The Court allowed the appeals, set aside the High Court judgment, and directed the Railway Board to regularise the canteen workers in line with the principles laid down in Secretary, State of Karnataka v. Uma Devi, filling future vacancies through regular recruitment. The order also affirmed the duty of the employer to provide canteen facilities where more than 250 workers are employed.
Issues considered
- Whether the premises of the Moradabad Division, including the canteen, qualify as a "factory" under Section 2(m) of the Factories Act, 1948.
- Whether the canteen qualifies as a "statutory canteen" under Section 46 of the Factories Act, 1948, thereby obligating the Railway Board to regularise the services of its staff.
Legislation cited
- Factories Act, 1948s. 2(k), s. 2(m), s. 2(n), s. 46
Subjects
Statutory canteenFactories ActRegularisation of servicesRailway employmentDefinition of factoryWorker welfareSection 46Occupational health
Judgment
• ·1
[2015] 8 S.C.R. 855
MOHAN SINGH & ORS. A
'f •••
v.
THE CHAIRMAN RAILWAY BOARD S;q_Rs.
(Civil Appeal Nos.5874-5875 of 2015) ·
AUGUST 03, 2015 B
[VIKRAMAJIT SEN AND PRAFULLA C. PANT, JJ.]
Factories Act, 1948 - ss. 46, 2(k), 2(m) - Canteens -
Regularisation of services of canteen staff- Existing canteen
at Moradabad Division of the Northern Railway - Held: C
Subject Canteen is situated within the precincts of the office
of the Divisional Railway Manager-ORM, Moradabad and
more than 1000 workers are working in those precincts -
Ma.nufacturing activity is carried out within the ORM Office
where the subject Canteen "is located - Thus, all the D
. requirements of the term "factory" as defined u/s. 2(m)
satisfied- Premises of ORM, Moradabad to be also treated ·
as a factory under the Act in which case Moradabad Canteen
shall ipso facto corresponded to a 'Statutory Canteen' within
the meaning of s.46 -. Thus, the subject Canteen is a E
'Statutory Canteen' under the Act - Canteen staff were not
appointed as per the regular recruitment procedure -
. Direction issued to respondents to consider regularization
of services of the staff employed in the subject Canteen in F
consonance with the principles laid down in * Uma Devi's case,
and fill posts that become vacant by a regular process of
selection.
Allowing the appeals, the Court
G.
HELD: 1.1 The Factories Act, 1948 is a social
legislation enacted for the welfare of the workers. It deals
with matters connected with the health, safety, welfare,
· working hours of the workers, employment of young
persons and leave to be granted to workers. The idea H
855
856 SUPREME COURT REPORTS [2015] 8 S.C.R.
A behind providing Statutory Canteen in a Factory is to
create efficient, healthy, loyal and satisfied labor force
for the organization. If such a responsibility has been
cast on an occupier of a Factory under the law, it remains
obligatory upon ORM, Moradabad to maintain a statutory
B canteen so long as the staff strength exceeds two-
hundred and fifty. [Para 12) [867-A-C)
1.2 So far as the second requirement mandatory to
constitute a premises including its precincts as factory,
C it cannot be disputed that the subject Canteen is situated
within the precincts of the office of the ORM, Moradabad
and more than 1000 workers are working in those
precincts. As regards "manufacturing process" is being
carriect on within the premises, it cannot be said that no
D manufacturing activity is carried out within the ORM
Office of Moradabad, where the subject Canteen is
located. It cannot be disputed that railway wagons are
repaired and maintained at the Moradabad Division. It is
also not disputed that the Moradabad Division carries
E on other activities such as repairing of faulty signals,
sanitation systems, loading and unloading of goods,
supply of power continuously for railway tracks, railway
station etc. Thus, it has perforce to be inferred that
F manufacturing process is being carried out at the·
Moradabad Division. [Paras 14, 15] [868-D-E; 869-C-E]
1.3 The ORM Office of Morada bad Division along with
all the appurtenant lands, yards, etc. are 'premises' within
the contemplation of the Factories Act. A comprehensive
G reading of the Factories Act, 1948 clearly shows that the
word "premises" can refer to an entire area, which may
have several separate buildings, within it, or which may
correspond to an open yard. Further, an important point I,___
to consider is that the definition of "manufacturing
H
MOHAN SINGH v. THE CHAIRMAN RAILWAY BOARD 857
process" does not mandate that the manufacturing A
activities should be carried on in one building alone.
Whatthis ~efinition really deals with is the nature of the
work done and not with where that work is to be done. It
must, therefore, be held that all the requirements of the
term "factory" as defined under Section 2(m) of the Act B
are satisfied on the facts of the instant case. Thus, the
premises of ORM, Moradabad must be also treated as a
factory under the Factories Act, 1948 in which case
Moradabad Canteen shall ipso facto corresponded to a
'Statutory Canteen' within the meaning of Section 46 of C
the Act. [Para 16] [869-H; 870-A, C-F]
1.4 The employees in the statutory canteens of the
Railways will have to be treated as Railway servants.
Thus, the relationship of employer and employee stands D
created between the Railway Administration and the
canteen employees from the very inception. [Para 17]
[871-C-D]
1.5 The subject Canteen is a 'Statutory Canteen' E
under the Factories Act, 1948 and that the Single Judge·
had arrived atthe correct conclusion. The Division Bench
of the High Court was not correct in taking a contrary
view. The impugned Judgment passed by the High Court
is set aside and the Respondents are directed to treat F
the subject Canteen at Moradabad as a Statutory
Canteen either under Section 46 of the Act or the relevant
clauses of the Indian Railway Establishment
Management. However, it is difficult to condone or ignore
the fact that the appellants were not appointed as per G
the regular recruitment procedure. To pass an order
regularizing the services of all workers employed therein
would necessarily imply ratification of appointments
given outside the Constitutional scheme. Therefore, the H
respondents are directed to consider regularizing the
858 SUPREME COURT REPORTS [2015] 8 S.C.R.
A services of the appellants presently serving as canteen
workers in consonance with the principles laid down in
*Secretary, State of Karnataka v. Uma Devi c~se and as
and when the subject posts fall vacant the Respondents
would be bound to fill the posts by a regular process of
B selection. [Para 18] [871-E-H; 872-A-B]
1.6 There cannot be any cavil that the necessity for
canteen amenities to be available where more than 250
workmen are engaged, is an essential facet of human or
C labour rights. Managements and employers are duty
bound to provide these basic facilities. [Para 19] [872-D]
*Secretary, State of karnataka v. Uma Devi AIR ·2006
SC 1806- relied on.
D
M.M.R. Khan v. Union of India 1990 SCR 687: (1990)
Supp SCC 191; Kam/a Devi V. Laxf!li Devi 2000 (1) Suppl.
SCR 330: (2000) 5 SCC 646; Ardeshir H. Bhiwandiwala v.
State of Bombay AIR 1962 SC 29: 1962 SCR 592 - referred
E to.
Black's Law Dictionary 51n Edn. - referred to.
Case Law Reference
F 1990 SCR 687 referred to. Para 4
2000 (1) Suppl. SCR 330 referred to. Para 16
1962 SCR 592 referred to. Para 16
G AIR 2006 SC 1806 relied on. Para 18
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos.
5874-5875 of2015.
From the Judgment and Order dated 16.03.2012 and
H 21.11.2013 of the High Court of Delhi at New Delhi 1n L.P.A.
MOHAN SINGH v. THE CHAIRMAN RAILWAY BOARD 859
No. 19 of 2012 and in Review Petition No. 275 of2012. A
Dinesh Kumar Garg, Abhishek Garg, Dhananjay Garg,
Deepak Mishra for the Appellants.
AK. Panda, Ashok Kumar Panigrahi, S.K. Bajwa, ST B
Ahmad, Shreekant N. Terdal for the Respondents.
The Judgment of the Court was delivered by
VIKRAMAJIT SEN,J. 1. Leave granted.
c
2 The legal nodus that arise in the present Appeals be-
fore us are whether the existing canteen at Morada bad Divi-
sion of the Northern Railway i.e., the subject Canteen, is lo-
cated in a 'Factory' within the meaning of Section 46 of the
Factories Act, 1948; and consequently, whether the services o
of the staff employed in the subject Canteen ought to be regu-
larized. These Appeals have been preferred against the Judg"
ment passed by the Division Bench of the High Court of New
Delhi in LPA No. 19 of 2012, whereby the Orders passed in
Writ Petition No. 6582 of 2003 and Review Petition No. 670 E
of 2011 have been set aside and it has been held that the
subject Canteen is a 'Non Recognized and Non Statutory' can-
teen.
3 We shall briefly narrate the facts leading up to the F
present /is. The Appellants are employed in the subject
Canteen, which has been running within the precincts of the
Divisional Railway Manager (hereinafter referred to as "the
ORM"), Moradabad since 1940 and has been catering to more
than 100 employees, (in fact, well over 500) since its G
establishment. In 1963, the Respondent No. 1, namely the
Chairman, Railway Board, issued a Circular No. E(W) 63/GN
1-2 dated 09.07.1963 for setting up of canteens as a welfare
measure, whenever and wherever the staff strength exceeds
100. The existing Staff Canteen, i.e. the subject Canteen H
860 SUPREME COURT REPORTS (2015] 8 S.C.R.
A continued to operate smoothly, even thereafter. It is the
uncontroverted case of the Appellants that when the subject
Canteen underwent severe financial losses in 1971, it was the
Respondent No. 3, i.e. the ORM of Northern Railways,
Moradabad Division, who decided to constitute a committee
B of three senior Railway Divisional Officers to examine whether
the affairs of the subject Canteen could be taken over by the
Railways. It was decided by the said committee that the affairs
of the subject Canteen be revived; and an ad hoc committee
comprising five Railway Officers, which was to be replaced
C later on by a regular management committee, be appointed
to manage the affairs of the said Canteen. It was in these
circumstances that the subject Canteen was formally taken over
by the Respondent Railways with effect from 18.01.1972.
Subsequently, Respondent No.1 issued Circular No. E (W) 83
0
CN1-8 dated 13.04.1987 laying down that prior approval of
the Railway Board would be mandatory for setting up of a new
canteen as well as for increasing the staff strength of existing
canteens. The Appellants assert that the mandate laid down
E in the Circular of 1987 was not applicable to the subject
Canteen as it was validly operational since 1940, and was
also in consonance with the Circular of 1963. Ergo, no prior
approval was required to be taken from the Railway Board
since the subject Canteen was not a new canteen. It appears
F thatt)lereafter on 19.09.1996, Respondent No. 2, the General
Manager of Northern Railways wrote a letter to the Railway
Board requesting it to accord recognition to the subject
Canteen in the interest of the welfare of the employees.
However, vide· Order dated 9.09.2002, the Ministry of Railways
G rejected this request on the premise that if recognition were to
be granted to the subject Canteen, the existing staff would
nevertheless not be absorbed automatically, and they would
have to compete with other eligible candidates. The Ministry
then ordered status quo to be maintained in respect of the
H subject Canteen. The said proposal was thereafter disc4ssed
MOHAN SINGH v. THE CHAIRMAN RAILWAY BOARD 861
[VIKRAMAJIT SEN,J]
in the Permanent Negotiating Machinery (PNM) meeting held A
on 22.12.2003, wherein it was decided that since the Railway
Board had already rejected the proposal for recognition due
to the changed priorities of Railways and cutting down of non-
planned expenditure, the proposal for recognition of any
canteen under the provisions of the Factories Act, 1948, or B
the Railway Manual could not be considered.
4 Aggrieved thereby, the Appellants filed a writ petition
before the Delhi High Court, seeking directions to the Railways
fo recognize the subject Canteen and regularize the services C
of the PS, who were the then Canteen staff, as employees of
Railways. The learned Single Judge, relying heavily upon the
view of this Court in M.M.R. Khan v. Union of India (1990)
Supp SCC 191, allowed the Writ Petition on 13.01.2011 and
held that since the subject Canteen at Morada bad has been D
operational for over seventy years, by then catering to more
than 900 employees, and in the absence of any other canteen
in the Moradabad Division, the Railways could not be
permitted to take advantage of their failure to comply with the
requirements of Section 46 of the Factories Act and treat this E
Canteen at Moradabad as a 'Non-Statutory Canteen'. Against
the Order of the learned Single Judge, a Review Petition was
preferred by the Respondents which was dismissed on
2.12.2011. The Respondents then filed an appeal contending, F
inter alia, that the subject Canteen was a 'Non-Statutory and
Non-Recognized' Canteen and that it could not be treated as
a 'Statutory Canteen' under the Factories Act, 1948 as no
manufacturing process was being carried on in the ORM Office
at Moradabad. _In the appeal, the Division Bench, vide the G
impugned Judgment dated 16.03.2012, reversed the decision
• of the learned Single Judge. It held that the provisions of
Section 46 of the Act would not get attracted in the.instant case
only because the number of the persons employed in the ORM
Office, Moradabad, exceeds two-hundred fifty, unless the H
862 SUPREME COURT REPORTS [2015] 8 S.C.R.
A concerned establishment squarely fell within the definition of
'Factory' as defined under Section 2 (m) of the Act. The
Division Bench acknowledged that the dictum laid down by
this Court in M.M.R. Khan has become locus ctassicus on
the subject of regularisation of employees of several canteens
B being run in the different Railway establishments. All the same,
it added that in order to avail the benefit emanating from M.M.R.
Khan the Appellants would have to prove the sine qua non of
a 'Statutory Canteen', i.e. that the subject Canteen is being
run in a premises which is a factory within the four corners of
c Section 46 of the Act. The Division Bench then took note of
Section 46 of the Act, which enjoins that 'manufacturing
process' must, inter alia, be carried on in the premises of a
'factory'.
D 5 We shall, first, consider the concomitants of a 'Non-
Statutory and Non-Recognised Canteen', which aspect has
been duly cogitated upon by this Court in M.M.R. Khan where
this Court has adumbrated the basic characteristics of a 'Non-
Recognized and Non-Statutory Canteen' thus -
E
"38. (iii) Non-statutory Non-recognised Canteens: The
difference between the non-statutory recognised and non-
statutory non-recognised canteen is that these canteens
are not started with the approval of the Railway Board as
F required ·under paragraph 2831 of the Railway
Establishment Manual. Though, they are started in the
premises belonging to the railways they are so started
I...
'
with the permission of the local officers. They are not
required to be managed either as pe·r the provisions of
G the Railway Establishment Manual or the Administrative
Instructions (supra). There is no obligation on the railway
administration to provide them with any facilities including
the furniture, utensils, electricity and water. These canteens
are further not entitled to nor are they given any subsidies
H
MOHAN SINGH v. THE CHAIRMAN RAILWAY BOARD 863
[VIKRAMAJIT SEN,J.]
or loans. They are run by private contractors and there is A
no continuity either of the contractors or the workers
engaged by them. JVlore often than not the workets go out
with the contractors. There is further no obligation cast
even on the local offices to supervise the working of these
canteens. No rule's whatsoever are applicable to the B
recruitment of the workers and their service conditions.
The canteens are run more or less on ad-hoc basis, the
railyvay administration having no control on their working
neither is there a record of these canteens nor of the
contractors who run them who keep on changing, much C
less of the workers engaged in these canteens. In the
circumstances we are of the view that the workers
engaged in these canteens are not entitled to claim the
· status of the railway servants".
D
6 It cannot be controverted that the subject Canteen has
been running since 1940 within the precincts of the office of
the ORM, Moradabad and has been under the direct control
and supervision of the ORM. The.Management Committee
appointed for administration of the subject Canteen comprises E
office bearers of the Canteen Management Committee, duly
elected in union elections held from time to time. Further, no
private contractor or co-operative society has ever been
engaged for running or operating the subject Canteen. The F
Appellants contend that the joining and leaving the canteen
staff has always been sanctioned and regulated by the
Controller, i.e. the Assistant Personnel Officer of the Northern
Railways. The prices of the food items supplied in the subject
Canteen as well as the salaries of the staff are also fixed by G
the said Assistant Controller Personnel Officer. Even the
renovation of the Canteen, in 2005, was carried out at the
directions of the Northern Railways, which bore all the
expenses incurred in this exercise. It further appears that the
Appellants have been provided with uniforms, medical aid, tree H
864 SUPREME COURT REPORTS [2015] 8 S.C.R.
A travelling passes, residential accommodations, privileged
ticket orders etc. by the Railways. Thus, it seems amply clear
from this factual matrix that the Respordents have remained
in control of the management and operation of the subject
Canteen.
B
7 For a canteen to qualify as a 'Recognized Canteen' it
is imperative to obtain the approval of the Railway Board. Since
the proposal for approval, admittedly, had been rejected by
the Railway Board vide Order dated 9.9.2002, it follows that
C the subject Canteen does not qualify as a 'Recognized
Canteen'. It thus, becomes crucial for us to examine whether
the subject Canteen is a 'Statutory Canteen' as postulated in
the Factories Act, 1948.
o 8 Section 46 of the Factories Act, 1948 which provides
for setting up of a 'Statutory Canteen' reads as follows:
46. Canteens.-
ill The State Government may make rules requiring that
E in any specified factory wherein more than two hundred
and fifty workers are ordinarily employed, a canteen or
canteens shall be provided and maintained by the occu-
pier for the use of the workers.
F ill Without prejudice to the generality of the foregoing
power, such rules may provide for-
.@} the date by which such canteen shall be pr9vided;
G
ill the standards in respect of construction,
accommodation, furniture and other equipment of the
canteen;
{9. the foodstuffs to be served therein and the charges
which may be made thereof;
H
MOHAN SINGH v. THE CHAIRMAN RAILWAY BOARD 865
[VIKRAMAJIT SEN,J.]
@ the constitution of a managing committee for the A
canteen and representation of the workers in the
management of the canteen;
(dd) the items of expenditure in the running of the canteen
which are not to be taken into account in fixing the cost of B
foodstuffs and which shall be borne by the employer;
.{fil the delegation to the Chief Inspector, subject to such
conditions as may be prescribed, of the power to make
rules under clause (c) c
9 The statute does not exempt factories belonging to the
Central Government from its reach; Parliament obviously
expected them to conform to what it perceived as essential to
welfare of the workforce. It is evident from a perusal of the
0
definition of canteens and factories that Government factories
have not been conceived of as beyond the concept of a 'factory',
nor do we find any justification for it to be otherwise. Thus,
what emerges from the above provision is that when an
establishment is a 'factory' within the meaning of Section 2(m) .E
of the Act, and there are more than two-hundred fifty workers
employed therein, the Occupier is obliged to set up a canteen
and conform to the statutory rules made in that behalf Section
2(n) of the Factories Act, 1948 defines 'Occupier' of a factory
'as a person who has ultimate control over the affairs of the F
factory'. Sub Seetion (iii) of Section 2(n) states that 'in the case
of a factory owned or controlled by the Central Government or
any State Government, or any local author.ity, the person or
persons appointed to manage the affairs of the factory by the
Central Government, the State Government or the local G
authority, as the case may be, shall be deemed to be the
occupier'. It cannot be controverted that each of the five units
of the Northern Railways, including the Moradabad Division,
is managed by a respective Divisional Railway Manager. Thus,
for the purposes of Section 2{n) of the Act, it can be fairly H
866 SUPREME COURT REPORTS [2015] 8 S.C.R.
A inferred that the ORM, by virtue of being in control of the affairs
of Moradabad Division, should be deemed to be the
'Occupier' of that unit of the Northern Railways.
10. Learned Counsel for the Respondents has duly
B admitted that Moradabad Division is a part of the Northern
Railways, but cont~nds that the whole of Northern Railways
cannot be declared as 'Factory'. We are presently concerned
only with the Moradabad ORM, which may well be dissimilar
to the other Divisional Offices of the Northern Railways, where
C manufacturing activity is absent. Therefore, we do not find merit
in the said argument. Section 4 of the Factories Act, 1948
gives power to the State Government to, either suo motu or
upon receiving an application in this behalf by an occupier,
declare different departments to be treated as separate
D factories. However, no such application can be said to have
been made by the Respondents or by the Northern Railways.
In the absence of any clear declaration in this respect, we
cannot but assume that Moradabad Division is a unit of
Northern Railway and ORM is its occupier within Section 2(n)
E of the Factories Act, 1948.
11 Further, it also appears that providing for a staff canteen
was felt necessary by the Respondents themselves and several
representations were made to the Railway Board from time to
F time for recognition of the subject Canteen. Such conduct or
approach is to be expected of every model employer, as the
Government must be. It is forth is very reason that the Divisional
Personnel Officer made the first request to the Divisional
Superintendent for recognition of the subject Canteen on
G 12.06.1972.Thereafter, the Respondent No. 2 addressed
another letter to the Respondent No. 1 on 19 .09.1996, whereby
it again stressed that running of a recognized canteen in
Moradabad is an imperative and important staff amenity. It is
H evident that the Respondents were aware of the need for
setting up and continuing a recognised canteen.
MOHAN SINGH v. THE CHAIRMAN RAILWAY BOARD 867
[VIKRAM~JIT SEN,J.]
12 The Factories Act, 1948 isa social legislation enacted A
for the welfare of the workers. It deals with matters connected
with the health, safety, welfare, working hours of the workers,
employment of young persons and leave to be granted to
workers. The idea behind providing Statutory Canteen in a
Factory is to create efficient, healthy, loyal and satisfied labor B
force for the organization. We are of the view that if such a
· responsibility has been cast on an occupier of a Factory under
the law, it remains obligatory upon ORM, Moradabad to
maintain a statutory canteen so long as the staff strength
exceeds two-hundred and fifty. C
13 Having discussed and noted the above statutory
provisions, we also find it necessary to examine the question
whetherthe Moradabad Division of the Northern Railways can
be considered a factory in itself under Section 2(m) of the D
Factories Act, 1948. To answer the said question, we must
examine the definition of 'factory' under the Factories Act,
1948.
Section 2(m) - "factory" means any premises including E
the precincts thereof-
ill whereon ten or more workers are working, or were
working on any day of the preceding twelve months, -and
in any part of which a manufacturing process is being F
carried on with the aid of power, or is ordinarily so carried
' on, or
@whereon twenty or more workers are working, or were
working on any day of the preceding twelve months, and G
in any part of which a manufacturing process is being
carried on without the aid of power, or is ordinarily so
carried on,-
but does not include a mine subject to the operation of H
the Mines Act, 1952 (35 of 1952), or a mobile unit
868 SUPREME COURT REPORTS [2015] 8 S.C.R.
A belonging to the armed forces of the Union, railway running ·
shed or a hotel, restaurant or eating plac~.
14 It can be inferred from above that the following
ingredients are mandatory to constitute a premises including
B its precincts as "factory" -
1. Work i.e. manufacturing process should be carried
on within the premises;
ii. If the manufacturing process is being carried on with
c or without the aid of power, the number of workers
required to constitute a factory differs as follows:
a. With the aid of power- 10 or more workers
o b. Without the aid of power- 20 or more workers;
So far as the second requirement is concerned, it cannot
be disputed that the subject Canteen is situated within the
precincts of the office of the ORM, Moradabad and more than
E 1000 workers are working in those precincts. The crucial
question that arises in the present case then is whether any
"manufacturing process" is being carried on within the premises
of the ORM Office, Moradabad.
F Manufacturing process has been defined under Section
2(k) of the Act as: Any process for-
.
ill making, altering, repairing, ornamenting, finishing,
packing, oiling, washing, cleaning-, breaking up,
demolishing, or otherwise treating or adapting any article
G or substance with a view to its use, sale, transport, delivery
or disposal;
@pumping oil, water, sewage or any other substance; or
H .@}generating, transforming or !1 ansrriitting power; or
MOHAN SINGH v. THE CHAIRMAN RAILWAY BOARD 869
[VIKRAMAJIT SEN,J.]
.
illLJ. composing types for printing, printing by letter press, A
lithography, photogravure or other similar process or book
binding; or
M constructing, reconstructing, repairing, refitting, finishing
or breaking up ships or vessels; or B
(vi} preserving or storing any article in cold storage.
15 The learned Counsel for the Respondent contends that
no manufacturing activity is carried out within the ORM Office
of Moradabad, where the subject Canteen is located. We, C
however, do not accept this contention. It cannot be disputed
that railway wagons are repaired and maintained at the
Morada bad Division. It is also not disputed that the Morada bad
Division carries on other activities such as repairing of faulty
0
signals, sanitation systems, loading and unloading of goods,
supply of power continuously for railway tracks, railway station
etc. Thus, it has perforce to be inferred that manufacturing
process is being carried out at the Moradabad Division.
16 The more important question that arises is whether E
the said manufacturing activities are carried on within the
premises of ORM Office, Moradabad. Black's Law Dictionary,
5'" Edition defines 'Premises', so far as estates and property
are concerned, as lands and tenements. With regard to the F
·Worker's Compensation Act, 'premises of employer' is not
restricted to permanent site of the employer's business nor to
property owned or leased by him but conter:nplates any place
under the exclusive control of the statl:!tory employer where his
normal business is conducted or carried out." In Kamla Devi G
V. LaxmiDevi (2000) 5 SCC 646, in the context of the Delhi
Rent Control Act, this Court has held that even an open plot of
land so long as it has some structures on it, will fall within the
meaning of 'premises'. Extrapolating from these decisions,
we are in no manner of doubt that the ORM Office of H
870 SUPREME COURT REPORTS [2015] 8 S.C.R.
A Moradabad Division along with all the appurtenant lands, yards,
etc. are 'premises' within the contemplation of the Factories
Act. In Ardeshir H. Bhiwandiwala v. State of Bombay AIR 1962
SC 29, the Constitution Bench explained that "premises
including precincts" does not necessarily mean that the
B premises must always have precincts. Even buildings need
not have any precincts. The word "including" is not a term
restricting the meaning of the word "premises" but is a term
which enlarges the scope of the word "premises". 'A
comprehensive reading of the Factories Act, 1948 clearly
C shows that the word "premises" can refer to an entire area,
which may have several separate buildings, within it, or which
may correspond to an open yard. Further, an important point
to consider is that the definition of "manufacturing process"
does not mandate that the manufacturing activities should be
0
carried on in one building alone. What this definition really deals
with is the nature of the work done and not with where that
work is to be done. It must, therefore, be held that all the
requirements of the term "factory" as defined under Section
E 2(m) of the Act are satisfied on the facts of the present case.
Thus, the premises of ORM, Moradabad must be also treated
as a factory under the Factories Act, 1948 in which case
Moradabad Canteen shall ipso facto corresponded to a
'Statutory Canteen' within the meaning of Section 46 of the
F Act.
17 Once that conclusion is reached, the result with respect
to status of workers employed therein becomes obvious. In
M.M.R. Khan, this Court has held - "Since in terms of the Rules
G made by the State Governments under Section 46 of the Act,
it is obligatory on the Railway Administration to provide a
canteen, and the canteens in question have been established
pursuant to the said provision there i; no difficulty in holding
that the canteens are incidental to or connected with the
H manufacturing process or the subject of the manufacturing
MOHAN SINGH v. THE CHAIRMAN RAILWAY BOARD 871
[VIKRAMAJIT SEN,J.]
process. The provision of the canteen is deemed by the statute A
as a necessary concomitant of the manufacturing activity.
Paragraph 2829 of the Railway Establishment Manual
recognises the obligation on the Railway Administration
created by the Act and as pointed out earlier paragraph 2834
makes provision for meeting the cost of the canteens. B
Paragraph 2832 acknowledges that although the Railway
Administration may employ anyone such as a Staff Committee
or a Co-operative Society for the management of the canteens,
the legal responsibility for the proper management rests not
with such agency but solely with the Railway C
Administration ..... We are, therefore, of the view that the
employees in the statutory canteens of th.e Railways will have
to be treated as Railway servants. Thus the relationship of
employer and employee stands created between the Railway · D
Administration and the canteen employees from the very
inception."
18 Therefore, in the light of the settled principle enunci-
ated hereinabove, we hold that the subject Canteen is a 'Statu-
tory Canteen' under the Factories Act, 1948 and that the learned E
Single Judge had arrived at the correct c~nclusion. In our opin- .
ion, the Division Bench of the High Court was not correct in
taking a contrary view. We, therefore, allow these Appeals.
We set aside the impugned Judgment passed by the High F
Court, and direct the Respondents to treat the subject Can-
teen at Moradabad as a Statutory Canteen either under Sec-
tion 46 of the Act or the relevant clauses of the Indian Railway
Establishment Management. However, so far as the Appel-
lants are concerned, we find it difficult to condone or ignore G
the fact that they were not appointed as per the regular recruit-
ment procedure. To pass an order regularizing the services of
all workers employed therein would necessarily imply ratifica-
tion of appointments given outside the Constitutional scheme.
We, therefore, direct the Respondents to consider regulariz- H
872 SUPREME COURT REPORTS [2015] 8 S.C.R.
A ing the services of the Appellants presently serving as can-
teen workers in consonance with the principles laid down in
Secretary, State of Karnataka v. Uma Devi AIR 2006 SC 1806
and take requisite action within six months of the receipt of
this Judgment. Further, as and when the subject posts fall
B vacant the Respondents shall be bound to fill the posts by a
regular process of selection. The Appellants in the present
case shall be allowed to compete in the regular recruitment
and the Respondents shall grant to them appropriate age re-
laxation as well as grant proper weightage for their having
C worked in the subject Canteen.
19 There cannot be any cavil that the necessity for can-
teen amenities to be available where more than 250 work-
. men are engaged, is an essential facet of human or labour
D rights. Managements and employers are duty bound to pro-
vide these basic facilities.
20 Stay granted by this Court on 28.03.2014 stands va-
cated. There shall be no order as to costs.
E
Nidhi Jain Appeals allowed.
•
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