Appeal No 85 of 1956
20 154 Appeal from the judgment and order dated January 8 1954 of the High Court of Saurashtra at Rajkot in Civil Misc
Application No 70 of 1952
R J Kolah and A C Dave for the appellant
Porus A Mehta and R H Dhebar for respondent No 1 1956
November 23
The Judgment of the Court was delivered by BHAGWATI J
This appeal with a certificate of fitness granted by the High Court of Saurashtra raises an interesting question whether the agarias working in the Salt Works at Kuda in the Rann of Cutch are workmen within the meaning of the term as defined in the  hereinafter referred to as the Act
The facts as found by the Industrial Tribunal are not in dispute and are as follows
The appellants are lessees of the Salt Works from the erstwhile State of Dharangadhara and also hold a licence for the manufacture of salt on the land
The appellants require salt for the manufacture of certain chemicals and part of the salt manufactured at the Salt Works is utilised by the appellants in the manufacturing process in the Chemical Works at Dharangadhara and the remaining salt is sold to outsiders
The appellants employ a Salt Superintendent who is in charge of the Salt Works and generally supervises the Works and the manufacture of salt carried on there
The appellants maintain a a railway line and sidings and also have arrangements for storage of drinking water
They also maintain a grocery shop near the Salt Works where the agarias can purchase their requirements on credit
The salt is manufactured not from sea water but from rain water which soaking down the surface becomes impregnated with saline matter
The operations are seasonal in character and commence sometime in October at the close of the monsoon
Then the entire area is parceled out into plots called pattas and they are in four parallel rows intersected by the railway 155 lines
Each agaria is allotted a patta and in general the same patta is allotted to the same agaria year after year
If the patta is extensive it is allotted to two agarias who work the same in partnership
At the time of such allotment the appellants pay a sum of Rs 400 for each of the pattas and that is to meet the initial expenses
Then the agarias commence their work
They level the lands and enclose and sink wells in them
Then the density of the water in the wells is examined by the Salt Superintendent of the appellants and then the brine is brought to the surface and collected in the reservoirs called condensers and re tained therein until it acquires by natural process a certain amount of density
Then it is flowed into the pattas and kept there until it gets transformed into crystals
The pans have got to be prepared by the agarias according to certain standards and they are tested by the Salt Superintendent
When salt crystals begin to form in the pans they are again tested by the Salt Superintendent and only when they are of a particular quality the work of collecting salt is allowed to be commenced
After the crystals are collected they are loaded into the railway wagons and transported to the depots where salt is stored
The salt is again tested there and if it is found to be of the right quality the agarias are paid therefore at the rate of Rs 0 5 6 per maund
Salt which is rejected belongs to the appellants and the agarias cannot either remove the salt manufactured by them or sell it
The account is made up at the end of the season when the advances which have been paid to them from time to time as also the amounts due from the agarias to the grocery shop are taken into account
On a final settlement of the accounts the amount due by the appellants to the agarias is ascertained and such balance is paid by the appellants to the agarias
The manufacturing season comes to an end in June when the monsoon begins and then the agarias return to their villages and take up agricultural work
The agarias work themselves with their families on the pattas allotted to them
They are free to engage extra labour but it is they who make the payments to 156 these labourers and the appellants have nothing to do with the same
The appellants do not prescribe any hours of work for these agarias
No muster roll is maintained by them nor do they control how many hours in a day and for how many days in a month the agarias should work
There are no rules as regards leave or holidays
They are free to go out of the works as they like provided they make satisfactory arrangements for the manufacture of salt
In about 1950 disputes arose between the agarias and the appellants as to the conditions under which the agarias should be engaged by the appellants in the manufacture of salt
The Government of Saurashtra by its letter of Reference dated November 5 1951 referred the disputes for adjudication to the Industrial Tribunal Saurashtra State Rajkot
The appellants contested the proceedings on the ground inter alia that the status of the agarias was that of independent contractors and not of workmen and that the State was not competent to refer their disputes for adjudication under section 10 of the Act
This question was tried as a preliminary issue and by its order dated August 30 1952 the Tribunal held that the agarias were workmen within the meaning of the Act and that the reference was intra vires and adjourned the matter for hearing on the merits
Against this order the appellants preferred an appeal being Appeal No 302 of 1952 before the Labour Appellate Tribunal of India and having failed to obtain stay of further proceedings before the Industrial Tribunal pending the appeal they moved the High Court of Saurashtra in MP No 70 of 1952 under articles 226 and 227 of the Constitution for an appropriate writ to quash the reference dated November 5 1951 on the ground that it was without jurisdiction
Pending the disposal of this writ petition the appellants obtained stay of further proceedings before the Industrial Tribunal and in view of the same the Labour Appellate Tribunal passed an order on September 27 1953 dismissing the appeal leaving the question raised therein to the decision of the High Court
By their judgment dated January 8 1954 the learned Judges 157 of the High Court agreed with the decision of the Industrial Tribunal that the agarias were workmen within section 2s of the Act and accordingly dismissed the application for writ
They however granted a certificate under article 1331 c of the Constitution and that is how the appeal comes before us
The sole point for determination in this appeal is whether the agarias working in the Salt Works of the appellants at Kuda are workmen within the definition of that term in section 2s of the Act
 Workman  has been thus defined in section 2 s of the Act s Workman  means any person employed including an apprentice in any industry to do any skilled or unskilled manual or clerical work for hire or  reward and includes for the purposes of any proceedings under this Act in relation to an industrial dispute a workman discharged during that dispute but does not include any person employed in the naval military or air service of the Government
 The essential condition of a person being a workman within the terms of this definition is that he should be employed to do the work in that industry that there should be in other words an employment of his by the employer and that there should be the relationship between the employer and him as between employer and employee or master and servant
Unless a person is thus employed there can be no question of his being a workman within the definition of the term as contained in the Act
The principles according to which the relationship as between employer and employee or master and servant has got to be determined are well settled
The test which is uniformly applied in order to determine the relationship is the existence of a right of control in respect of the manner in which the work is to be done
A distinction is also drawn between a contract for services and a contract of service and that distinction is put in this way  In the one case the master can order or require what is to be done while in the other case he can not only order or require what is to be done 158 but how itself it hall be done Per Hilbery J in Collins vs Hertfordshire County Council 1 The test is however not accepted as universally correct
The following observations of Denning LJ at pp 110 III in Stevenson Jordan and Harrison Ltd vs Macdonald and Evans 2 are apposite in this context But in Cassidy vs Ministry of Health 3 Lord Justice Somervell pointed out that test is not universally correct
There are many contracts of service where the master cannot control the manner in which the work is to be done as in the case of a captain of a ship
Lord Justice Somervell went on to say One perhaps cannot get much beyond this Was the contract a contract of service within the meaning which an ordinary man would give under the words   I respectfully agree
As my Lord has said it is almost impossible to give a precise definition of the distinction
It is often easy to recognize a contract of service when you see it but difficult to say wherein the difference lies
A ship s master a chauffeur and a reporter on the staff of a newspaper are all employed under a contract of service but a ship s pilot a taxi man and a newspaper contributor are employed under a contract for services
One feature which seems to run through the instances is that under a contract of service a man is employed as part of the business and his work is done as an integral part of the business whereas under a contract for services his work although done for the business is not integrated into it but is only accessory to it
 We may also refer to a pronouncement of the House of Lords in Short vs J  W Henderson Ltd 4 where Lord Thankerton recapitulated the four indicia of a contract of service which had been referred to in the judgment under appeal viz a the master s power of selection of his servant b the payment of wages or 1  615
2  Ill 3  543 sc  352 3
4194662TLR 427429
159 other remuneration c the master s right to control the method of doing the work and d the master s right of suspension or dismissal but observed Modern industrial conditions have so much affected the freedom of the master in cases in which no one could reasonably suggest that the employee was thereby converted into an independent contractor that if and when an appropriate occasion arises it will be incumbent on this House to reconsider and to restate these indicia
For example a b and d and probably also c are affected by the statutory provisions and rules which restrict the master  choice to men supplied by the labour bureaux or directed to him under the Essential Work provisions and his power of suspension or dismissal
is similarly affected
These matters are also affected by trade union rules which are atleast primarily made for the protection of wage earners
 Even in that case the House of Lords considered the right of supervision and control retained by the employers as the only method if occasion arose of securing the proper and efficient discharge of the cargo as sufficiently determinative of the relationship between the parties and affirmed that  the principal requirement of a contract of service is the right of master in some reasonable sense to control the method of doing the work and this factor of superintendence and control has frequently been treated as critical and decisive of the legal quality of relationship
The position in law is thus summarised in Halsburv s Laws of England Hailsham edition Vol 22 page 112 para 191  Whether or not in any given case the relation of master and servant exists is a question of fact but in all cases the relation imports the existence of power in the employer not only to direct what work the servant is to do but also the manner in which the work is to be done and until the position is restated as contemplated in Short vs J  W Henderson Ltd supra we may take it as the prima facie test for determining the relationship between master and servant 160 The principle which emerges from these authorities is that the prima facie test for the determination of the relationship between master and servant is the existence of the right in the master to supervise and control the work done by the servant not only in the matter of directing what work the servant is to do but also the manner in which he shall do his work or to borrow the words of Lord Uthwatt at page 23 in Mersey Docks and Harbour Board vs Coggins  Griffith Liverpool Ltd and Another 1  The proper test is whether or not the hirer had authority to control the manner of execution of the act in question The nature or extent of control which is requisite to establish the relationship of employer and employee must necessarily vary from business to business and is by its very nature incapable of precise definition
As has been noted above recent pronouncements of the Court of Appeal in England have even expressed the view that it is not necessary for holding that a person is an employee that the employer should be proved to have exercised control over his work that the test of control was not one of universal application and that there were many contracts in which the master could not control the manner in which the work was done Vide observations of Somervell LJ in Cassidy vs Ministry of Health supra and Denning LJ in Stevenson Jordan and Harrison Ltd vs MacDonald and Evans supra The correct method of approach therefore would be to consider whether having regard to the nature of the work there was due control and supervision by the employer or to use the words of Fletcher Moulton LJ at page 549 in Simmons vs Health Laundry Company 2  In my  opinion it is impossible to lay down any rule of law distinguishing the one from the other
It is a question of fact to be decided by all the circumstances of the case
The greater the amount of direct control exercised over the person rendering the services by the person contracting for them the stronger the 1  23
2 1910 1 KB 543 54 550
9 161 grounds for holding it to be a contract of service and similarly the greater the degree of independence of such control the greater the probability that the services rendered are of the nature of professional services and that the contract is not one of service
 The Industrial Tribunal on a consideration of thes facts in the light of the principles enunciated above came to the conclusion that though certain features which are usually to be found in a contract of service were absent that was due to the nature of the industry and that on the whole the status of the agarias was that of workmen and not independent contractors
It was under the circumstances strenuously urged before us by the learned counsel for the respondents that the question as regards the relationship between the appellants and the agarias was a pure question of fact that the Industrial Tribunal had jurisdiction to decide that question and had come to its own conclusion in regard thereto that the High Court exercising its jurisdiction under articles 226 and 227 of the Constitution was not competent to set aside the finding of fact recorded by the Industrial Tribunal and that we here entertaining an appeal from the decision of the High Court should also not interfere with that finding of fact
Reliance was placed on the observations of Mahajan J as he then was in Ebrahim Aboobakar vs Custodian General of Evacuee Property 1 It is plain that such a writ cannot be granted to quash the decision of an inferior court within its jurisdiction on the ground that the decision is wrong
Indeed it must be shown before such a writ is issued that the authority which passed the order acted without jurisdiction or in excess of it or in violation of the principles of natural justice
But once it is held that the court has jurisdiction but while exercising it made a mistake the wronged
party can only take the course prescribed by law for setting matters right inasmuch as a court has jurisdiction to decide rightly as well as wrongly  1  702
21 162 There is considerable force in this contention of the respondents
The question whether the relationship between the parties is one as between employer and employee or between master and servant is a pure question of fact
Learned counsel for the appellants relied upon a passage from Batt s Law of Master and Servant 4th edition at page 10  The line between an independent contractor and a servant is often a very fine one it is a mixed question of fact and law and the judge has to find and select the facts which govern the true relation between the parties as to the control of the work and then he or the jury has to say whether the person employed is a servant or a contractor
 This statement however rests upon a passing observation of Mc Cardie J in Performing Right Society Ltd vs Mitchell and Booker Palais de Danse1 and is contrary to the oaten of authorities which lays down that whether or not in any given case the relation of master and servant exists is purely one of fact
Vide Halsbury s Laws of England Hailsham edition Vol 22 page 112 para
191 Per Cozens Hardy MR at page 547 and Per Fletcher Moulton LJ at page 549 in Simmons vs Heath Laundry Company supra
It is equally well settled that the decision of the Tribunal on a question of fact which it has jurisdiction to determine is not liable to be questioned in proceedings under article 226 of the Constitution unless at the least it is shown to be fully unsupported by evidence
Now the argument of Mr Kolah for the appellants is that even if all the facts found by the Tribunal are accepted they only lead to the conclusion that the agarias are independent contractors and that the finding therefore that they are workmen is liable to be set aside on the ground that there is no evidence to support it
We shall therefore proceed to determine the correctness of this contention
Apart from the facts narrated above in regard to which there is no dispute there was the evidence of the Salt Superintendent of the appellants which was recorded before the Tribunal 1 163 The panholders are allotted work on the salt pans by oral agreement
The Company has no control over the panholders in regard to the hours of work or days of work
The Company s permission is nor sought in matter of sickness or in matter of going out to some village
The Company has no control over the panholders as to how many labourers they should engage and what wages they should pay them
The company s supervision over the work of the panholders is limited to the proper quality as per requirements of the Company and as per standard determined by the Government in matter of salt
 The company s supervision is limited to this extent
The Company acts in accordance with Clause 6 of the said agreement in order to get the proper quality of salt
Panholders are not the workmen of the Company but are contractors
The men who are entrusted with pattas work themselves
They can engage others to help them and so they do
There is upto this day no instance that any penholder who is entrusted with a patta has not turned up to work on it
But we do not mind whether he himself works or not
If any penholder after registering his name for a patta gets work done by others we allow it to be done
We own 319 pattas
Some patta8 have two partners
In some one man does the job
ID all the pans mainly the panholders work with the help of their respective families
 Clause 6 of the agreement referred to in the course of his evidence by the Salt Superintendent provided  6
We bind ourselves to work as per advice and instructions of the officers appointed by them in connection with the drawing of brine or with the process of salt production in the pattas and if there is any default negligence or slackness in executing it on our part or if we do not behave well in any way the Managing Agent of the said Company can annul this agreement and can take possession of the patta brine well etc and as a result we will not be entitled to claim any 164 sort of consideration or compensation for any half processed salt lying in our patta or in respect of any expense incurred or labour employed in preparing kiwa patta well bamboo lining etc
 There was also the evidence of Shiva Daya an agaria who was examined on behalf of the respondents  There is work of making enclosures and then of sinking wells
The company supervises this work
While the wells are being sunk the company measures the density of the brine of wells
In order to bring the brine of wells to the proper density it is put in a condenser and then the Company tests this and then this brine is allowed to flow in the pattas
The bottom of a patta is prepared after it is properly crushed under feet and after the company inspects and okays that it is alright water is allowed to flow into it
When salt begins to form at the bottom of a patta an officer of the company comes and inspects it
At the end of 21 months the water becomes saturated ie useless and so it is drained away under the supervision of the company
Then fresh brine is allowed to flow into the patta from the condenser
This instruction is also given by the company s officer
 It was on a consideration of this evidence that the Industrial Tribunal came to the conclusion that the supervision and control exercised by the appellants extended to all stages of the manufacture from beginning to end
We are of opinion that far from there being no evidence to support the conclusion reached by the Industrial Tribunal there were materials on the record on the basis of which it could come to the conclusion that the agarias are not independent contractors but workmen within the meaning of the Act
Learned counsel for the appellants laid particular stress on two features in this case which in his submission were consistent only with the position that the agarias are independent contractors
One is that they do piece work and the other that they employ their own labour and pay for it
In our opinion neither of these two circumstances is decisive of the question
As 165 regards the first the argument of the appellants is that as the agaria8 are under no obligation to work for fixed hours or days and are to be paid wages not per day or hours but for the quantity of salt actually produced and passed at a certain rate the very basis on which the relationship of employer and employees rests is lacking and that they can only be regarded as independent contractors
There is however abundant authority in England that a person can be a workman even though he is paid not per day but by the job
The following observations of Crompton J in Sadler vs Henlock 1 are pertinent in this behalf   The test here is whether the defendant retained the power of controlling the work
No distinction can be drawn from the circumstances of the man being employed at so much a day or by the job
I think that here the relation was that of master and servant not of contractor and contractee See also Blake vs Thirst 2 and Halsbury s  Laws of England  Hailsham edition Vol 22 page 119 para
194 wherein it is stated that if a person is a worker and not a contractor  it makes no difference that his work is piece work  As regards the second feature relied on for the appellants it is contended that the agaria8 are entitled to engage other persons to do the work that these persons are engaged by the agaria8 and are paid by them that the appellants have no control over them and that these facts can be reconciled only with the position that the agaria8 are independent contractors
This argument however proceeds on a misapprehension of the true legal position
The broad distinction between a workman and an independent contractor lies in this that while the former agrees himself to work the latter agrees to get other persons to work
Now a person who agrees himself to work and does so work and is therefore a workman does not cease to be such by reason merely of the fact that he gets other persons to work along 1   578    212
2 1863 32 LJ Exchequer 188 166 with him and that those persons are controlled and paid by him
What determines whether a person is a workman or an independent contractor is whether he has agreed to work personally or not
If he has then he is a workman and the fact that he takes assistance from other persons would not affect his status
The position is thus summarised in Halsbury s Laws of England  Vol 14 pages 651 652  The workman must have consented to give his personal services and not merely to get the work done but if he is bound under his contract to work personally he is not excluded from the definition simply because he has assistance from others who work under him See also Grainger vs Aynsley  Bromley vs Tams 1 Weaver vs Floyd 2 and Whitely vs Armitage a In the instant case the agarias are professional labourers
They themselves personally work along with the members of their families in the production of salt and would therefore be workmen
The fact that they are free to engage others to assist them and pay for them would notin view of the above authorities affect their status as workmen
There are no doubt considerable difficulties that may arise if the agarias were held to be workmen within the meaning of section 2 s of the Act
Rules regarding hours of work etc applicable to other workmen may not be conveniently applied to them and the nature as well as the manner and method of their work would be such as cannot be regulated by any directions given by the Industrial Tribunal
These difficulties however are no deterrent against holding the agarias to be workmen within the meaning of the definition if they fulfil its requirements
The Industrial Tribunal would have to very well consider what relief if any may possibly be granted to them having regard to all the circumstances of the case and may not be able to regulate the work to be done by the aqarias and the remuneration to be paid to them by the employer in 1 1881 6 QBD 182
2 3 167 the manner it is used to do in the case of other industries here the conditions of employment and the work to be done by the employees is of a different character
These considerations would necessarily have to be borne in mind while the Industrial Tribunal is adjudicating upon the disputes which have been referred to it for adjudication
They do not however militate against the conclusion which we have come to above that the decision of the Industrial Tribunal to the effect that the agarias are workmen within the definition of the term contained in section 2 s of the Act was justified on the materials on the record
We accordingly see no ground for interfering with that decision and dismiss this appeal with costs
Appeal dismissed


Summary:
The appellants were lessees holding a license for the manufacture of salt on the demised lands
The salt was manufactured by a class of professional labourers known as agarias from rain water that got mixed up with saline matter in the soil
The work was seasonal in nature and commenced in October after the rains and continued till June
Thereafter the agarias left for their own villages for cultivation work
The demised lands were divided into plots called Pattas and allotted to the a arias with a sum of Rs 400 for each Patta to meet the initial expenses
Generally the same patta was allotted to the same aigaria every year and if a patta was extensive in area it was allotted to two agarias working in partnership
After the manufacture of salt the agayias were paid at the rate Of 5 as
6 pies per maund
At the end of each season the accounts were settled and the agarias paid the balance due to them
The agarias who worked themselves with the members of their families were free to engage extra labour on their own account and the appellants had no concern therewith
No hours of work were prescribed no muster rolls maintained nor were working hours controlled by the appellants
There were no rules as regards leave or holidays and the agarias were free to go out of the factory after making arrangements for the manufacture of salt
The question for decision was whether in such circumstances the agarias could be held to be workmen as defined by section 2s Of the Industrial Disputes Act of 1947 as found by the Industrial Tribunal and agreed with by the High Court or they were independent contractors and the reference for adjudication made by the Government competent under section 10 of the Act
Held that the finding of the Industrial Tribunal that the agarias were workmen within the meaning of section 2S of the Industrial Disputes Act of 1947 was correct and the reference was competent
The real test whether a person was a workman was whether he had been employed by the employer and a relationship of employer and employee or master and servant subsisted between them and it was well settled that the prima facie test of such 153 relationship was the existence of the right in the employer not merely to direct what work was to be done but also to control the manner in which it was to be done the nature or extent of such control varying in different industries and being by its nature incapable of being precisely defined
The correct approach therefore was to consider whether having regard to the nature of the work there was due control and supervision of the employer
Mersey Docks and Harbour Board vs Coggins  Griffith Liver Pool Ltd and Another   and Simmons vs Heath Laundry Company  referred to
The question whether the relation between the parties was one as between an employer and employee or master and servant was a pure question of fact and where the Industrial Tribunal having jurisdiction to decide that question came to a finding such finding of fact was not open to question in a proceeding under article 226 of the Constitution unless it could be shown to be wholly unwarranted by the evidence
Ebrahim Aboobakar vs Custodian General of Evacuee Property   referred to
Performing Right Society Ltd etc
vs Mitchell and Booker Plaise De Danse 1924 i KB 762 not followed
A person could be a workman even though he did piece work and was paid not per day but by the job or employed his own labour and paid for it
Sadler vs Henlock  and Blake vs Thirst 1863 32 LJ Exchequer 188 referred to
The broad distinction between a workman and an independent contractor was that while the former would be bound by agreement to work personally and would so work the latter was to get the work done by others
A workman would not cease to be so even though lie got other persons to work with him and paid and controlled them
Grainger vs Aynsley  Bromley vs Tams 1881 6 QBD 182 Weaver vs Floyd 1825 21 LH QB 151 and Whitely vs Armitage  referred to
As in the instant case the agayias who were professional labourers and personally worked with the members of their families in manufacturing the salt were workmen within the meaning of the Act the fact that they were free to engage others to assist them and paid for them could not affect their status as workmen