I.C.I. India Ltd. vs State of U.P. and Others

S.U. Khan, J.—At the time of hearing (13.5.2009) no one appeared on behalf of contesting respondents hence only the arguments of learned Counsel for the petitioner were heard.

Order passed on 13.5.2009 while reserving the judgment is quoted below:

List revised. No one appears for the respondent.

Heard learned Counsel for the petitioner. Learned Counsel for the petitioner has argued that respondent No. 4 workman was employed by the contractor-respondent No. 5 and now the contractor is not doing any job for the petitioner still under the interim order passed by this Court petitioner is paying wages to the workman even though there is no work for him

Judgment is reserved.

Initially the petitioner was known as M/s. I.E.L. Ltd. (Indian Explosive Limited).

In the petitioner''s factory at Kanpur canteen was being run by respondent No. 5 M/s. Gaylords, Caterers and Confectioners. They had employed several persons in connection with canteen business including respondent No. 4 Raj Kumar Melhotra. Respondent No. 5 terminated the services of the respondent No. 4. Industrial dispute was raised and State Government made a reference to the labour court through notification dated 25.7.1979 to decide as to whether action of respondent No. 5 terminating the services of its employee respondent No. 4, w.e.f. 23.10.1978 was valid or not. Thereafter, on the application of respondent No. 4 the reference was amended and petitioner was also impleaded therein as employer through notification dated 29.9.1984. The matter was registered as Adjudication Case No. 292 of 1979 before Presiding Officer Labour Court I, Kanpur.

The case of the petitioner was that it had no concern with the employees of the canteen and liability if any was of respondent No. 5 who was the employer. One of the points raised before the labour court on behalf of employer was that respondent No. 4 was not a workman as his designation was Tiffin Room Manager. However, respondent No. 4 asserted that he was not performing any supervisory job hence he was a workman.

The matter as to whether the employees of the canteen run in the factory of the petitioner were employees of the petitioner or not had come to this Court earlier. The union had raised the dispute that canteen employees were workmen of the principal employer, i.e., the petitioner. The matter was referred to the labour court. In the said reference a preliminary issue was decided against the employers against which they filed a writ petition in this Court which was decided against them. The decision is in I.E.L. v. State of U.P. and Ors. 1981 LIC 1395. In the impugned award the labour court placed reliance upon the said Judgment and held that respondent No. 4 was employee of the petitioner and that the petitioner was principal employer. Ultimately, the presiding officer of the labour court through award dated 2.4.1990 held that termination of services was bad as retrenchment compensation as required by Section 6N of U.P.I.D. Act had not been paid. It further held that petitioner was employer hence it must take the workman back and pay 75% of back wages from 1.1.1985.

The matter which was referred to the labour court regarding general canteen employees of the canteen run in the premises of petitioners'' factory was registered as Adjudication Case No. 16 of 1977. In the said case Union had given an exhaustive list of the employees which was part of reference in pursuance of which Adjudication Case No. 16 of 1977 was registered. Name of the respondent No. 4 was not included in the list. The labour court held that such omission will not make any difference. It further held that supervision was merely a small fraction of main duties of respondent No. 4. It has also been mentioned in the impugned award that after the above decision of the High Court and consequent decision of Adjudication Case No. 16 of 1977 the workers of the canteen were taken into employment by the petitioner. It has also been stated in the impugned award that witness of the petitioner stated that canteen contract with respondent No. 5 was terminated w.e.f. 1.8.1981 and settlement was arrived at on 23.6.1981 in Adjudication Case No. 16 of 1977 between canteen workmen, M/s. Geylords, respondent No. 5 and petitioner.

It has also been observed in the impugned award that another similarly situate person, i.e., Sri H.N. Tandon was also manager, however, Sri Tandon was covered by the agreement arrived at in Adjudication Case No. 16 of 1977.

In the following authorities Supreme Court has held that it is statutory duty of the management of a factory to arrange for a canteen within the factory premises hence canteen workers are workmen of the management of the factory:

Steel Authority of India Ltd. Vs. Union of India (UOI) and Others, Employers in relation to the Management of Sudamdih Colliery of Bharat Coking Coal Ltd. Vs. Their workmen represented by Rashtriya Colliery Mazdoor Sangh,

National Thermal Power Corporation Ltd. Vs. Karri Pothuraju and Others, and

Steel Authority of India Ltd. and Others etc. etc. Vs. National Union Water Front Workers and Others etc. etc.,

The Supreme Court in the following authorities has held that if the only defect in the termination order is non-compliance of provision of Section 6N of U.P. I.D. Act (equivalent to Section 25F of I.D. Act) then it is not always necessary to direct reinstatement with back wages and in certain situations award of consolidated damages/compensation may be the proper relief:

Nagar Mahapalika (Now Municipal Corpn.) Vs. State of U.P. and Others,

Haryana State Electronics Development Corporation Ltd. Vs. Mamni,

Sita Ram v. Moti Lal Nehru Farmers Training Institute AIR 2008 SC 1955.

In the instant case, I find that it is more appropriate to award consolidated damages / compensation instead of reinstatement for the following reasons:

(1) At the time of termination of services of respondent No. 4 there was some confusion regarding status of canteen employees. In the case of employees of the canteen run in the premises of the petitioner''s factory the decision was given by this Court in 1981 and thereafter compromise was entered into in Adjudication Case No. 16 of 1977 on 23.6.1981 and employees of the canteen were taken by the petitioner as its employees on 1.1.1981.

(2) Name of the respondent No. 4 was not there in the list of canteen employees regarding which Adjudication Case No. 16 of 1977 was initiated.

(3) Petitioner had neither any control over nor any say in the termination of respondent No. 4.

(4) In the reference initially petitioner was not party.

(5) State of Uttaranchal and Another Vs. Sunil Kumar Singh Negi, has held that if after award of reinstatement workman does not join then award cannot be enforced.

Accordingly writ petition is allowed impugned award is set aside and substituted by the direction to the petitioner of payment of reasonable damages/compensation to respondent No. 4. The salary which has been received by respondent No. 4 till date under impugned award and interim order passed in this writ petition without work shall be treated to be the consolidated compensation/damages in lieu of reinstatement. No amount paid to the respondent No. 4 till date shall be refundable.