UMRALA GRAM PANCHAYATversusTHE SECRETARY, MUNICIPAL EMPLOYEES UNION & ORS.

                    [2015) 3 S.C.R. 659



               UMRALAGRAM PANCHAYAT                              A

                              v.
  THE SECRETARY, MUNICIPAL EMPLOYEES UNION &
                            ORS.
                                                                 B
           (Civil Appeal Nos. 3209-3210 of 2015)

                      MARCH 27, 2015

     [V. GOPALA GOWDA AND C. NAGAPPAN, JJ.]                      c
        Industrial Disputes Act, 1947-ss.2(ra), 25(T)- Unfair
labour practice- Daily wage workers - Benefit ofpermanency,
entitlement of - Workmen appointed to the post of safai
kamdars of the Gram Panchayat- Serving for varied years-         o
18 years, 16 years, 8 years, 5 years but considered as daily
wage workers- Industrial dispute raised by workmen seeking
benefit of permanency under the Panchayat-Award passed
by the labour court that workmen to be made permanent
employees - Said award upheld by the High Court - E ·
Justification of- Held: Orders of the High Court and the Award
passed by the Labour Court was reasonable and has been
arrived at in a just and fair manner - Workmen did the same
work which was being done by the permanent workmen of
the Panchayat, they worked for similar number of hours, F
however; there is discrepancy in the payment of wages/salary
between the permanent and non-permanent workmen - The
same amounted to unfair labour practice as defined u/s.2(ra)
which is prohibited uls. 25(T) - Further; there was no restriction G
for recruitment of workmen in the Panchayat set up, financial
position of the Panchayat is sound -Also principle of equal
work, equal pay has been violated by the Panchayat- Thus,
services of the workmen are held permanent in nature, since
they have worked for more than 240 days in a calendar year H
                                659
660         SUPREME COURT REPORTS                  [2015] 3 S.C.R.



A     from the date of their initial appointment- Panchayat directed
      to treat services of the workmen as permanent employees
      after five years of their initial appointment and pay regular
      pay scale - Gujarat Panchayat Act, 1993.

B            Dismissing the appeals, the Court

             ·HELD: 1.1 It is an admitted fact that the work
      which was being done by the concerned workmen was
      the same as that of the permanent workmen of the
c     appellant-Panchayat. They have also been working for
      similar number of hours, however, the discrepancy in
      the payment of wages/salary between the permanent and
      the non-permanent workmen is alarming and the same
      has to be construed as being an unfair labour practice
D     as defined under Section 2(ra) of the Industrial Disputes
      Act r/w Entry No.10 of the Fifth Schedule to the ID Act,
      which is prohibited under Section 25(T) of the ID Act.
      Further, there is no documentary evidence produced on
      record before the Labour Court by the appellant
E     panchayat which shows that the present workmen are
      working less or for lesser number of hours than the
      permanent employees of the appellant-Panchayat. Thus,
      on the face of it, the work being done by the concerned
F     workmen has been permanent in nature and the Labour
      Court as well as the High Court have come to the right
      conclusion on the points of dispute and have rightly
      rejected the submission of the appellant-Panchayat as
      the same amounts to unfair labour practice by the
G     appellant-Panchayat which is prohibited under Section
      25(T) of the ID Act and it also amounts to statutory
      offence on the part of the appellant under Section 25(U)
      of the ID Act for which it is liable to be prosecuted. [Para
      10] [667-D-H; 668-A]
H
UMRALAGRAM PANCHAYATv. SECRETARY, MUNICIPAL 661
         EMPLOYEES UNION & ORS.

       1.2 The Labour Court has rightly held that there       A
is no restriction for the recruitment of the workmen in
the Panchayat's set-up as there is evidence to show that
by making a proposal, the District Panchayat has
increased the work force in the establishment of the
appellant-Panchayat. Further, the financial position of the   B
Panchayat is not so unsound as no activity of the
Panchayat has been discontinued, as all the other
workers of the Panchayat are being paid their wages
regularly. Thus, there would be no difficulty for the         C
Panchayat to bear the extra cost for the payment of the
wages/salary and other monetary benefits to the
concerned workmen if they are made permanent.
Further, Section 25(T) of the ID Act clearly states that
unfair labour practice should not be encouraged and the       o
same should be discontinued. In the instant case, the
principle "equal work, equal pay" has been violated by
the Panchayat as they have been treating the concerned
workmen unfairly and therefore, the demand raised by
the respondent-Union should be accepted. [Paras 11, 12        E
and 13) [668-A-G]

       1.3 The orders of the High Court and the Award
passed by the Labour Court are reasonable and the same
have been arrived at in a just and fair manner. The F
services of the concerned workmen are permanent Jn
nature, since they have worked for more than 240 days
in a calendar year from the date of their initial
appointment, which is clear from the evidence on record.
Therefore, not making their services permanent by the G
appellant-Panchayat is erroneous and also amounts to
error in law and not sustainable in law. The appellants
are directed to treat the services of the concerned
workmen as permanent employees, after five years of H
662        SUPREME COURT REPORTS                 [2015] 3 S.C.R.


A their initial appointment as daily wage workmen till they
  attain the age of superannuation for the purpose of
  granting terminal benefits to them; and pay the regular
  pay-scale as per the revised pay scale to the concerned
  workmen and the legal representatives of the deceased
B workmen. [Para 15, 17, 18 and 19) [670-D-E, H; 670-A-C]

        Maharashtra State Road Transport Corporation and
        Anr. v. Casteribe Rajya P. Karmchari Sanghatana
        (2009) 8 SCC 556; Durgapur Casual Workers Union v.
c       Food Corporation of India (2014) 13 SCALE 644 -
        referred to.
                                       '
        Secretary, State of Kamataka &Ors. v. Umadevi & Ors.
        2006 (3) SCR 953: (2006) 4 SCC 1 - distinguished.
D
                         Case Law Reference

      (2009) s sec 556          referred to.         Para 14

      (2014) 13 SCALE 644       referred to.         Para 14
E
      2006 (3) SCR 953          distinguished.       Para 16

            CIVIL APPELLATE JURISDICTION : Civil Appeal No.
      3209-3210 of2015
F
            From the Judgment and Order dated 23.07.2013 of the
      High CourtofGujaratatAhmedabad in LPANo. 551 of2013,
      23.07.2013 in SCA No. 7082 of 1994, 23.07.2013 in MCA
      No. 3071of2012,13.07.2010 in SCA NO. 7082of1994
G
            Mahendra Anand, Ananthem Henry, Vivek Kumar
      Pukhrambam Ramesh Kumar for the Appellant.

            S. C. Patel for the Respondents.

H
UMRALAGRAM PANCHAYATv. SECRETARY, MUNICIPAL 663
         EMPLOYEES UNION & ORS.

      The Judgment of the Court was delivered by             A

      V. GOPALA GOWDA, J. 1. Delay condoned. Leave
granted.

       2. These appeals have been filed by the appellant
                                                              8
against the final judgment and order dated 23.07.2013
passed in Letters Patent Appeal No. 551 of 2013 in Misc.
CivilApplication No.3071 of2012 in Special Civil Application
No. 7082of1994, by the High Court of Judicature of Gujarat
at Ahmedabad, whereby the High Court ha~ dismissed the       c
same as being not maintainable and has upheld the judgment
and order of the learned single Judge of the High Court dated
13.07.2010, passed in Special Civil Application No. 7082
of 1994, which is also impugned herein, wherein the
application filed by the appellant has been dismissed by the D
High Court by confirming the Award dated 15.05.1991 ·
passed by the Labour Court in Reference (LCD) No. 6 of
1988.

        3. For the purpose of considering the rival legal E
contentions urged on behalf of the parties in these appeals
and with a view to find out whether this Court is required to
interfere with the impugned judgment and orders of the High
Court as well as the Award of the Labour Court, the necessary
facts are briefly stated hereunder:                           F

         The appellant-Gram Panchayat was duly established
under the provisions of the Gujarat PanchayatAct, 1993 (in
short 'the Act'). The workmen of the Panchayat, some of whom
are now deceased and are being represented by their legal G
heirs, were appointed to the post of safai kamdars of the
appellant-Panchayat and have served for many years, varying
from 18 years, 16 years, 8 years, 5 years etc. They were
however, considered as daily wage workers and were H
664         SUPREME COURT REPORTS                 (2015) 3 S.C.R.


A     therefore, not being paid benefits such as pay and allowances
      etc. as are being paid to the permanent safai kamdars of
      the appellant- Panchayat.

           4. On 23.07.1987, the workmen raised an industrial
B dispute before the Conciliation Officer at Bhavnagar, through
    the respondent no.1, Municipal Employees Union (for short
  · "Union") stating therein that ?fter rendering services for a
    number of years, the workmen are entitled to the benefit of
    penllanency under the appellant-Panchayat. The settlement
C between the workmen and the appellant-Panchayat failed to
    resolve amicably during the conciliation proceedings and
    therefore, the failure report was sent to the Dy. Commissioner
    of Labour, Ahmedabad, who referred the same to the Labour
D Court vide Reference (LCD) No.6/88. The Labour Court by its
    Award held that the workmen are to be made permanent
  ·employees as safai kamdars in the appellant-Panchayat.
    The Labour Court has further directed the appellant-
    Panchayat that the workmen should be paid wages,
E allowances and other monetary benefits as well for which
   they are legally entitled to.

          5. Aggrieved by the Award of the Labour Court, the
  appellant-Panchayat filed an appeal before the single Judge
F of the High Court, whereby the same was dismissed and it
  was held that the view taken by the Labour Court is just and
  proper as it has assigned cogent and convincing reasons for
  arriving at the conclusion that the services of the concerned
  workmen should be . made permanent as the other
G employees of the appellant. The appellant, hereafter, filed
  an LPA before the Division Bench of the High Court, which
  was also dismissed as not maintainable. Hence, these
  appeals have been filed by the appellant seeking to set aside
  the judgments and orders of the High Court as well as the
H
UMRALAGRAM PANCHAYATv. SECRETARY, MUNICIPAL 665
 EMPLOYEES UNION &ORS. [V. GOPALA GOWDA, J.]

Award passed by the Labour Court.                               A
       6. It has been contended by Mr. MahendraAnand, the
learned senior counsel on behalf of the appellant that the
workmen were not appointed on a permanent basis as the
rules and regulations as prescribed under the provisions of     B
the Act have not been followed. He has further contended
that the High Court has erred in upholding the Award passed
by the Labour Court as the same is illegal and there is non
application of mind by the courts below. The Labour Court
has wrongly held that there are 13 permanent posts              C
available for the category in which the concerned employees
are working as the other three employees who are made
permanent employees have been made so only because
there were clear vacant posts available in the approved
strength in the capacity in which these three employees were    D
made permanent and thus, there is no question of any
discrimination or unfair labour practice on the part of the
appellant-Panchayat in not making the concerned workmen
as permanent employees of the appellant.                        E

         7. It has been further contended by the learned senior
counsel that the concerned workmen were engaged in the
services, as and when required by the appellant-Panchayat
and it is not obligatory on the part of the appellant- Panchayat F
to provide work to the workmen on a day-to-day basis and
the appellant-Panchayat has no control over them as there
is no employer- employeerelationship between them. It has
been further contended by him that the appellant-Panchayat
has no right to make them permanent employees. For making G
their services permanent in the appellant-Panchayat, an
application has to be made before the District Panchayat,
Bhavnagar and a demand has to be raised before it and the
recruitment of the employees of the appellant-Panchayat is
                                                                H
666         SUPREME COURT REPORTS                 [2015] 3 S.C.R.


A     done by the Gujarat Panchayat Service Selection Board and .
      directions will be issued on its behalf. However, there are no
      such directions issued in relation to the concerned workmen.

            8. On the other hand, it has been contended by Mr.
B S.C. Patel, the learned counsel appearing on behalf of the
   respondent-Union that the concerned workmen have been
   working for many years, such as 18 years, 16 years, 8 years
   continuously and some of them have been working for more
   than 5 years in the appellant-Panchayat. They are not paid
C the monetary benefits and allowances etc. as are being paid
   to other permanent safai kamdars who are working in the
   appellant-Panchayat. He has further contended that the
   concerned workmen are doing the same work as is being done
D by the permanent safai kamdars and they have been working
   for similar number of hours, i.e. eight hours per day like the
   permanent employees of the appellant- Panchayat. In spite
   of it, they are being monetarily exploited by the appellant-
   Panchayat by not being paid regular salary and other
E monetary benefits for which they are legally entitled to but are
   being paid much lesser wage, i.e. Rs.390/- per month.
   Therefore, the learned counsel has contended that the
   appellant is practicing unfair labour practice as defined
   under Section 2(ra) of the Industrial Disputes Act, 1947 (in
F short "the ID Act") as enumerated at Entry No.10 in the Fifth
   Schedule to the ID Act. Therefore, the action of the appellant-
 . Panchayat is illegal and the workmen should be allowed to
   get permanency in the said posts.

G          9. With reference to the abovementioned rival legal
    contentions urged on behalf of the parties, we have to
    examine the impugned judgements and orders of the High
    Court as well as the Award passed by the Labour Court, to
    find out whether any substantial question of law would arise
H
UMRALAGRAM PANCHAYATv. SECRETARY, MUNICIPAL 667
 EMPLOYEES UNION & ORS. [V. GOPALA GOWDA, J.)

in these appeals to exercise the appellate jurisdiction of this A
Court?

        10. On a perusal of the same, we have come to the
conclusion that the High Court has rightly dismissed the case
of the appellant as the Labour Court has dealt with the same B
in detail in its reasoning portion of the Award in support of its
findings of fact while answering the points of dispute and the
same cannot be said to be either erroneous or error in law. In
support of the above said conclusions arrived at by us, we
record our reasons hereunder:                                     C

        It is an admitted fact that the work which was being
done by the concerned workmen was the same as that of
the permanent workmen of the appellant- Panchayat. They
have also been working for similar number of hours, however,      D
the discrepancy in the payment of wages/salary between the
permanent and the non-permanent workmen is alarming and
the same has to be construed as being an unfair labour
practice as defined under Section 2(ra) of the ID Act r/w Entry
No.1 Oof the Fifth Schedule to the ID Act, which is prohibited    E
under Section 25(T) of the ID Act. Further, there is no
documentary evidence produced on record before the Labour
Court which shows that the present workmen are working less
or for lesser number of hours than the permanent employees        F
of the appellant-Panchayat. Thus, on the face of it, the work
being done by the concerned workmen has been permanent
in nature and the Labour Court as well as the High Court
have come to the right conclusion on the points of dispute
and have rightly rejected the contention of the appellant-        G
Panchayat as the same amounts to unfair labour practice by
the appellant-Panchayat which is prohibited under Section
25(T) of the ID Act and it also amounts to statutory offence on
the part of the appellant under Section 25(U) of the ID Act for
                                                                  H
668         SUPREME COURT REPORTS                  (2015] 3 S.C.R.


A     which it is liable to be prosecuted.

           11. Further, the Labour Court has rightly held that there
   is no restriction for the recruitment of the workmen in the
 · Panchayat's set-up as there is evidence to show that by
B making a proposal, the District Panchayat has increased
   the work force in the establishment of the appellant-
   Panchayat and therefore, the contention urged by the learned
   senior counsel appearing forthe appellant-Panchayat that there
   are only limited number of permanent vacancies for the
C workmen in the Panchayat of the appellant is not tenable in
   law.

          12. Further, we have also taken note of the fact that the
  financial position of the Panchayat is not so unsound as no
D activity of the Panchayat has been discontinued, as all the
  other workers of the appellant-Panchayat are beingpaid their
  wages regularly. Thus, there would· be no difficulty for the
  appellant-Panchayat to bear the extra cost for the payment
  of the wages/salary and other monetary benefits to the
E concerned workmen if they are made permanent.

          13. Further, Section 25(T) of the ID Act clearly states
  that unfair labour practice should not be encouraged and the
  same should be discontinued. In the present case, the
F principle "equal work, equal pay" has been violated by the
  appellant-Panchayat as they have been treating the concerned
  workmen unfairly and therefore, the demand raised by the
  respondent-Union needs to be accepted. The High Court
G has thus, rightly not interfered with the Award of the Labour
  Court as the same is legal and supported with cogent and
  valid reasons.

         14. Therefore, the learned single Judge as well as the
H Division Bench of the High Court have exercised the power
UMRALAGRAM PANCHAYATv. SECRETARY, MUNICIPAL 669
 EMPLOYEES UNION & ORS. [V. GOPALAGOWDA, J.]

under Articles 226 and 227 of the Constitution of India and A
have rightly held that the Labour Court has jurisdiction to
decide the industrial dispute that has been referred to it by
the Dy. Commissioner of Labour, Ahmedabad. Reliance has
been placed upon the decision of this Court in the case of
Maharashtra State Road Transport Corporation and Anr. B
v. Casteribe Rajya P. Karmchari Sanghatana 1, wherein it
has been held thus:

   "32.The power given to the Industrial and Labour Courts
   under Section 30 is very wide and the affirmative action     c
   mentioned therein is inclusive and not exhaustive.
   Employing badlis, casuals or temporaries and to
   continue them as such for years, with the object of
   depriving them of the status and privileges of
                                                                D
   permanent employees is an unfair labour practice on
   the part of the employer under item 6 of Schedule IV.
   Once such unfair labour practice on the part of the
   employer is established in the complaint, the Industrial
   and Labour Courts are empowered to issue preventive          E
   as well as positive direction to an erring employer."

       Further, reliance has been placed upon the decision of
this Court in the case of Durgapur Casual Workers Union
v. Food Corporation of lndia,2 wherein it has been held         F
thus:

  "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
                                                                G
  Singh v. Haryana Warehousing Corporation in Civil
  Appeal No. 6327 of2014 decided on 9th July, 2014. In
  the said case, this Court observed and held as follows:

1 c2oosi a sec 556
                                                                H
2 (2014) 13 SCALE 644
670          SUPREME COURT REPORTS                    (2015] 3 S.C.R.


A        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
         case. The issue pertaining to unfair labour practice
         was neither the subject matter for decision nor was it
B        decided in Umadevi's case.

         21. We have noticed that Industrial Disputes Act is made
         for settlement of industrial disputes and for certain other
         purposes as mentioned therein. Iprohibits unfair labour
c        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            15. Thus, in the light of the above referreid cases of this
      Court, it is amply clear that the judgments and orders of the
      High Court and the Award passed by the Labour Court are
      reasonable and the same have been arrived at in. a just and
      fair manner.
E.
             16. The reliance placed by the learned senior counsel
      forthe appellant uponthe decision of this Court in Secretary,
      State of Karnataka & Ors. v. Umadevi & Ors·3 , does not
      apply to the fact situation of the present case and the same
F     cannot be accepted by us in the light of the cogent reasons
      arrived at by the courts below.

        17. In view of the reasons stated supra and in the light
  of the facts and circumstances of the present case, we
G hold that the services of the concerned workmen are
  permanent in nature, since they have worked for more than
  240 days in a calendar year from the date of their initial
  appointment, which is clear from the evidence on record.

H    3 c2006) 4 sec 1
UMRALAGRAM PANCHAYATv. SECRETARY, MUNICIPAL 671
 EMPLOYEES UNION & ORS. [V. GOPALAGOWDA, J.]

Therefore, not making their services permanent by the A
appellant-Panchayat is erroneous and.also amounts to error
in law. Hence, the same cannot be allowed to sustain in law.

        18. For the reasons stated supra, we dismiss the
appeals and direct the appellants to treat the services of the B
concerned workmen as permanent employees, after five
years of their initial appointment as daily wage workmen till
they attain the age of superannuation for the purpose· of
granting terminal benefits to them.
                                                                 c
       19. The appellant is further directed to pay the regular
pay-scale as per the revised pay scale fixed to the post of
permanent safai kamdars for a total period of 15 years to
the concerned workmen and the legal representatives of
the deceased workmen. The same shall be implemented D
within six weeks from the date of receipt of copy of this
judgment and compliance report of the same shall be submitted
for the perusal of this Court. No Costs.

Nidhi Jain                                  Appeals dismissed.   E