Case: Tandur and Navandgi Stone Quarries Private, Limited, Basheerabad, Andhra Pradesh Vs. Their Workmen

Gajendragadkar, J.1. This appeal arises out of an industrial dispute between the appellant, the Tandur and Navandgi Stone Quarries (Private), Ltd., and the respondents, its workmen. It appears that several demands were made by the respondents, and conciliation in respect of the said demands having failed, the dispute was referred for adjudication by the Central Government to the industrial tribunal on 1 May, 1959. Five demands were originally referred for adjudication by this order. Later, five other demands were added to the reference, and so, ten issues were framed by the tribunal in dealing with the said demands. The award shows that out of the said ten demands, seven were disposed of by consent between the parties; these are demands covered by issues (a), (b), (c), (f), (h), (i) and (l). In regard to the demand covered by issue (d), the tribunal held that it was not justified, and in respect of demand (g), the tribunal did not make any finding but directed that the recommendation which may be made by the Minimum Wages Committee appointed by the Andhra Pradesh Government in respect of the said demand, may be implemented by the appellant if the rate fixed by the said report happens to be higher than the existing rate and the same is accepted by the Government. This demand was in regard to the rate of wages per 100 sq. ft. of stone sizing and stone cutting for each of the relevant operations and for combined operations. The last demand which gave rise to issue (e) was in regard to the bonus claimed by the respondents for the years 1952 to 1958. The tribunal found that the claim for bonus for bonus for the years 1952-53, 1953-54, 1953-54 1954-55 and 1955-56 was belated, and so, it rejected the said claim; that left the claim for bonus for the years 1956-57 and 1957-58. But the award, the tribunal has ordered that the appellant should pay the respondents Rs. 30, 000 and Rs. 40, 000 respectively by way of bouns for the said two years. It is this award which is challenged by the appellant before us by its appeal brought by special leave.On 25 July 1962, when this appeal was argued before us, it was urged by Sri Vimadalal that the preliminary objection about the competence of the reference which had been raised by the appellant before the tribunal had not been considered by it, and so, he urged the unless the said preliminary objection was considered on the merits and decided against him, the stage of examining the merits of the award would not arise. We took the view that this argument was well-founded, and so, by our interlocutory judgment delivered on the said date, we asked the tribunal to make a finding on the said preliminary objection. The preliminary objection in question raised an important point for decision; it was : whether the respondents were workmen employed by the appellant ? The appellants case was that they were not his workmen and so, any dispute raised by them could not be said amount to an industrial dispute under the Industrial Disputes Act, 1947 (hereinafter called the Act). In our interlocutory judgment, we directed that the parties should be given an opportunity to lead additional evidence and the issue dealt with in the light of the evidence already on record, as well as the evidence which may be adduced after remand.2. In pursuance of the said order of the remand, the tribunal took evidence led by the parties and made its finding on 7 January, 1963. The tribunal has held that out of the labourers whose dispute had been referred to it for adjudication to the person whom the company calls, "independent contractors" except the fifty to sixty Muslim pardhanashin hand-polishers, are workmen as defined by S.2(s) of the Act, and, therefore, the reference in respect of them was valid. The tribunal has also found that the workers working under the "contractors" are not workmen under the Act, and there was no relationship of master and servant between the appellant and them so as to make their demands industrial demands. In other words, the dispute in respect of the said workmen could not be said to have been properly referred. Sri Vimadalal for the appellant has challenged the correctness of the said finding. He contends that all the workmen covered by the reference are not the appellants employees and so, the reference is entirely void.Before dealing with this point, it would be relevant to consider another contention raised by Sri Vimadalal. This contention has reference to the hand-polishers employed in the appellants concern. Sri Vimadalal argues that the claim for bonus which is one of the items of dispute included in the reference does not take in a claim for bonus made by the hand-polishers, and so, it should be confined to the workmen other than the polishers. This argument is based on the fact that two sets of demands were made by the workmen against the appellant, one by the hand-polishers and the other by the remaining workmen, and in both the sets of demands claim for bonus were separately made. The record shows that the both these sets of demands were separately referred for adjudication. The demands made by the hand-polishers which constituted the subject-matter of a separate reference were, however, defeated by the contention raised by the appellant before the arbitrator that the said reference was invalid for the reason that the appellants activity fell within the purview of the Mines Act and as such, the State Government was not competent to make the reference; the reference should have been made by the Central Government. Upholding this objection, the tribunal dismissed the reference on 13 April 1959.3. On 1 May 1959, the present reference was made, and Sri Vimadalal suggests that having regard to the background furnished by the two sets of demands, the claim for bonus which is the subject-matter of issue (e) in the present proceedings should be limited to workmen other than the hand-polishers. We are not impressed by this argument. It is obvious that though a claim for bonus may be made separately by different section of employees, it has to be tried as one claim on principal, and the decision of the question in reference proceedings in relation to a claim made by one section of the workmen would naturally govern the decision of the other reference in relation to a similar claim made by order sections of the employees. The question about the available surplus for a specified period between an employer and his employees has to be tried as a whom, and one cannot deal with it separately just because different sections of workmen purport to make separate claims in that behalf. Besides, in the present proceedings the same union had made both the claims and it is plain that if the reference made in regard to the hand-polishers failed because of the technical objection raised by the appellant, it would be idle to contend that a claim for bonus should be confined to workmen other than the hand-polishers. If the workmen employed by the appellant are entitled to bonus, there is no reason why hand-polishers should be denied that benefit. It this connexion, we ought to add that the present reference was made after the reference in regard to the hand-polishers was dismissed and the demand for bonus which has been referred for adjudication in the present case is worded in such wide terms that on its plain construction, it would be impossible to confine it to workmen other than hand-polishers. Therefore, we do not think that Sri Vimadalal is right in contending that the hand-polishers should not be given the benefit of the finding of the tribunal on the question of bonus.Sri Vimadalal has then contended that the finding made by the tribunal on the preliminary issue remanded to it, suffers from the infirmity that it has failed to consider the evidence which was already on the record. In our order of remand, we had asked the tribunal to consider the evidence which was already on the record as well as the evidence which may be adduced by the parties after remand. Sri Vimadalal suggests that the tribunal has omitted to consider the evidence which was already on the record. In this connexion, he relies on the fact that on the record had been produced by the appellant the Minimum Wages Committees Report and no reference has been made to this report by the tribunal in recording its present finding. There is no substance in this argument. It is true that the report in question shows that operators in quarries engaged contractors, and so, at the highest it may be permissible to say that the practice pleaded by the appellant that his employees were contractors and not his workmen, cannot be dismissed as an afterthought; but we do not see how the observations made in the report about the existence of the practice to employ contractors in quarry operations can have any bearing when the tribunal was dealing with the actual evidence led by the parties in regard to the character of the employment of the labourers, the work done by them, and the relation of the appellant in respect of the said employees and those employed by such employees. Therefore, the argument that the report has been ignored is not valid.4. The again, Sri Vimadalal contends that the inspection report made by the tribunal at the earlier stage should have been considered, and in support of this argument he has referred us to some of the statements made before arbitrator when he inspected the quarries. This argument is entirely misconceived. If arbitrator put some casual questions to the workers whom he found working in the quarries, that would have no materiality, because on the main point in dispute between the parties, evidence has been led after remand and it is in the light of the said evidence that the question has to be considered and decided.Lastly, Sri Vimadalal has urged that the case of the respondents as to the character of the employment of the contractors has varied from time to time, and he contends that the discrepancy between the pleadings and the story which has ultimately been disclosed by the evidence led by the respondents, should have been borne in mind by the tribunal. This arguments is also without any force. In industrial adjudication, tribunals are naturally reluctant to apply the law of pleadings in all its strictness, and the fact that all aspects of the question in reference to the character of the labourers employment were not set out by the respondents in their written statement, cannot be said to affect the credibility of the evidence led by them at the trial. Thus, the three objections raised by Sri Vimadalal in support of his argument that the finding recorded by the tribunal is vitiated, cannot be accepted.5. In regard to the merits of the finding, Sri Vimadalal very strongly relied on the evidence of Sheikh Ahmed who was examined by the appellant. His grievance is that this evidence has not been appreciated by the tribunal. We were, therefore, taken through the evidence of this witness. The witness started by saying that he did not supervise the work of petty contractors and added that there was no rule in the company that the work must commence at any particular hour each day nor was the time fixed when the work must stop each day. According to him, no attendance is recorded of the workers working for petty contractors, nor are the hours of work put in by them recorded. He stated that no attendance register or record is maintained with regard to the attendance of petty contractors. This evidence was naturally led to show that between the contractors and the appellant, there was no relationship of employer and employee. This witness, however, was cross-examined and he had to admit that when slips are issued to the petty contractors, their names are shown in the column of workmen. Similarly, the wages slips are signed by the said contractors in the column of employees. As soon as this fact was admitted by the witness, it followed that the record kept by the appellant described the contractors as its employees; they signed the wage slips as employees and the wage slips were issued to them in the same character. If the appellant employed certain persons and called them his kamgars or workmen and the relevant part of the record in respect or their wages supported this theory, then it would be difficult to accept the appellants version that these persons are not its workmen or employees, but independent contractors. Once it is shown satisfactorily by the documents kept by the appellant itself then the relationship between the appellant and the so-called contractors commenced with their employment as employees, then there is very little room for argument as to whether the parties are related to each other as master and servant or not. The hours of work, the manner of paying the wages, and the quantity of work expected from the employees are then matters of contract; but as soon as the basic relationship of master and servant is satisfactorily proved by the appellants documents, the terms of contract and the problem as to whether the work is supervised by the employer or not, becomes relatively unimportant. This aspect of the matter is clearly brought out by the admissions made by Sheikh Ahmed himself. Besides, on the evidence the tribunal has made very clear and emphatic findings. He has found that out of the 2, 000 workers who work everyday in the various quarries of the appellant, about 400 to 500 persons work as contractors, and the rest assist the said contractors. The tribunal considered the evidence bearing on the question of employment and found that the area in which each contractor has to work is specified by the appellant, and the rate at which the said work has to be paid is fixed between the parties. It was to admitted by the appellant that these contractors themselves work at the quarries generally with the other members or their families, and the tribunal came to the conclusion that the appellant supervises their work in several ways. The case of the hand-polishers was also examined by the tribunal and it concluded that the entries in the wages slips, the pay-sheet register, cash-book and ledger showed that they are employed by the appellant. In this connexion, the tribunal commented on the fact that the appellant had not produced any record of the attendance of the individual contractors or their polishers, and he was inclined to draw an adverse inference against the appellant for the non-production of the said record. The Mines Act applies to the applicants undertaking and the tribunal commented on the fact that even this fact was admitted by the appellants witnesses with considerable hesitation and not without reluctance. The tribunal examined the standing orders which had been framed by the appellant and took the view that the provisions of the standing orders themselves make it clear that they were to apply to the appellants quarries and the "contractors" working at the quarries were governed by them. In the end, the tribunal held that the company has supervisors who supervise the work of these independent contractors at the quarries and also of the hand-polishers. The result was that the so-called independent contractors were held to be workmen employed by the appellant and that the fifty to sixty Muslim pardhanashin hand-polishers and labourers employed by the contractors were not the appellants workmen. We do not see how the finding recorded by the tribunal after an elaborate and careful consideration of the evidence led by both the parties can be successfully challenged by Sri Vimadalal in the present appeal. Ordinarily this Court does not entertain appeals on questions of fact in industrial matters brought to this Court under Art. 136. Thought in the present case, the conclusions reached by the tribunal have been recorded in the form of finding as a result of the order of remand passed by this Court, the position in regard to the appellants right to challenge the correctness of the said finding is substantially the same as in an appeal field against an award where the relevant findings have already been recorded. Therefore, we are satisfied that the conclusion reached by the tribunal on the issue remanded to it by our order of remand is right and must be upheld.That takes us to the question of bonus which Sri Vimadalal has pressed before us. The position with regard to the award made by the tribunal in respect of bonus lies within a very narrow compass. There is no controversy in regard to the figures or calculations while applying the Full Bench formula. According to the appellant itself, the available surplus for the years 1956-57 and 1957-58 was Rs. 79, 000 and Rs. 96, 200 respectively. It was also admitted by the appellant that to the monthly-rated staff, such as clerks, lorry-drivers, cleaners, measurement-takers and others numbering fifty-nine the appellant had paid Rs. 32, 400 and Rs. 30, 000 by way of bonus for the years 1956-57 and 1957-58 respectively. The tribunal took into account these facts and directed that the appellant should pay to the respondents Rs. 30, 000 and Rs. 40, 000 respectively for 1956-57 and 1957-58. The tribunal then expressed the hope that whilst distributing the amount of bonus amongst the individual contractors and hand-polishers, the management should take steps to see that these individual contractors in their turn pay the workers whom they had engaged their due share of the bonus awarded.6. Sri Vimadalal argues that the direction as to the payment of bonus made by the tribunal should be revised because now the tribunal has made a finding that a substantial number of labourers who worked in the quarries of the appellant during the relevant two years are not its workmen, and in that connexion, he emphasized the fact that there is no guarantee that the amount of bonus which the appellant may pay to its contractors would in turn to be distributed by the conractors to the labourers engaged by them. There is doubt some force in this argument; but on the other hand, the record shows that the wages are paid by the appellant to the contractors not only for the work for the work done by the contractors themselves but also for the work done by the labourers employed by the contractors; the quarry operations are carried on under the appellants concern in a mixed way; contractors who are the appellants employees do some work themselves and they are assisted either by members by their families or by labourers employed by them, and the piece-rate system of paying wages involves the payment to the contractors for the quantity of work done by them in collaboration with their family members and with the labourers employed by them. Thus, when wages are paid to the contractors, they are expected to distribute the proportionate share of the said wages to the labourers engaged by them. That, however, is not a matter with which the appellant is directly concerned and for which it can be held to be responsible. Similarly, the bonus that would be paid by the appellant to the contractors would, in theory, be due not only to them, but also to those others who assisted them in the quarry operations. That, however, like the wages, is not a matter with which the appellant is directly concerned and for which it can be held to be responsible. This somewhat anomalous position is the result of the mixed character of employment which workers at the appellants quarries. Even so, we cannot overlook the fact that the amount of bonus which would be paid by the appellant to the contractors would all remain in their hands and is not likely to reach the labourers who assisted them. Under these unusual circumstances, we think, Sri Vimadalal is right when he contends that we should reduce the amount of bonus ordered to be paid by the tribunal. The direction which we propose to issue in this behalf of determined obviously on a purely ad hoc basis and should not be regarded as a precedent between the parties in future and should not be treated as affording any guidance in other disputes of a like nature. We have taken in to account the amount of bonus paid by the appellant to its fifty-nine employees who are monthly-rated and we have come to the conclusion that having regard to the number of contractors who are now found to be the appellants employees and the wages paid to them, it would, on the whole, be fair and just that the appellant should be directed to pay to the respondents who are found to be the workmen of the appellant Rs. 30, 000 by away of bonus for 1956-57 and 1957-58 each year, instead of Rs. 30, 000 and Rs. 40, 000 respectively. In regard to the question of the distribution of the said amounts of bonus, we direct that the said amounts should be distributed amongst the workmen of the appellant in proportion to the annual wages earned by them during to the annual wages earned by them during the relevant years respectively, and rounded off to the nearest rupee.The last point which calls for our decision is in respect of the direction issued by the tribunal that the rates of wages prescribed by it by consent of parties as regards several items of work should take effect from 1 May, 1959. Sri Vimadalal contends and we think, rightly, that this retrospective payment of additional amounts would benefit only the contractors and not the labourers who assisted them. Besides, he argues that having regard to the wages paid by the appellant to the contractors, there is no justification for giving retrospective effect to the award in regard to those items. We

Decision:
1[ds]We are not impressed by this argument. It is obvious that though a claim for bonus may be made separately by different section of employees, it has to be tried as one claim on principal, and the decision of the question in reference proceedings in relation to a claim made by one section of the workmen would naturally govern the decision of the other reference in relation to a similar claim made by order sections of the employees. The question about the available surplus for a specified period between an employer and his employees has to be tried as a whom, and one cannot deal with it separately just because different sections of workmen purport to make separate claims in that behalf. Besides, in the present proceedings the same union had made both the claims and it is plain that if the reference made in regard to thefailed because of the technical objection raised by the appellant, it would be idle to contend that a claim for bonus should be confined to workmen other than theIf the workmen employed by the appellant are entitled to bonus, there is no reason whyshould be denied that benefit. It this connexion, we ought to add that the present reference was made after the reference in regard to thewas dismissed and the demand for bonus which has been referred for adjudication in the present case is worded in such wide terms that on its plain construction, it would be impossible to confine it to workmen other thanTherefore, we do not think that Sri Vimadalal is right in contending that theshould not be given the benefit of the finding of the tribunal on the question ofour order of remand, we had asked the tribunal to consider the evidence which was already on the record as well as the evidence which may be adduced by the parties afteris no substance in this argument. It is true that the report in question shows that operators in quarries engaged contractors, and so, at the highest it may be permissible to say that the practice pleaded by the appellant that his employees were contractors and not his workmen, cannot be dismissed as an afterthought; but we do not see how the observations made in the report about the existence of the practice to employ contractors in quarry operations can have any bearing when the tribunal was dealing with the actual evidence led by the parties in regard to the character of the employment of the labourers, the work done by them, and the relation of the appellant in respect of the said employees and those employed by such employees. Therefore, the argument that the report has been ignored is not valid.This argument is entirely misconceived. If arbitrator put some casual questions to the workers whom he found working in the quarries, that would have no materiality, because on the main point in dispute between the parties, evidence has been led after remand and it is in the light of the said evidence that the question has to be considered andarguments is also without any force. In industrial adjudication, tribunals are naturally reluctant to apply the law of pleadings in all its strictness, and the fact that all aspects of the question in reference to the character of the labourers employment were not set out by the respondents in their written statement, cannot be said to affect the credibility of the evidence led by them at the trial. Thus, the three objections raised by Sri Vimadalal in support of his argument that the finding recorded by the tribunal is vitiated, cannot bedo not see how the finding recorded by the tribunal after an elaborate and careful consideration of the evidence led by both the parties can be successfully challenged by Sri Vimadalal in the present appeal. Ordinarily this Court does not entertain appeals on questions of fact in industrial matters brought to this Court under Art. 136. Thought in the present case, the conclusions reached by the tribunal have been recorded in the form of finding as a result of the order of remand passed by this Court, the position in regard to the appellants right to challenge the correctness of the said finding is substantially the same as in an appeal field against an award where the relevant findings have already been recorded. Therefore, we are satisfied that the conclusion reached by the tribunal on the issue remanded to it by our order of remand is right and must beThere is doubt some force in this argument; but on the other hand, the record shows that the wages are paid by the appellant to the contractors not only for the work for the work done by the contractors themselves but also for the work done by the labourers employed by the contractors; the quarry operations are carried on under the appellants concern in a mixed way; contractors who are the appellants employees do some work themselves and they are assisted either by members by their families or by labourers employed by them, and thesystem of paying wages involves the payment to the contractors for the quantity of work done by them in collaboration with their family members and with the labourers employed by them. Thus, when wages are paid to the contractors, they are expected to distribute the proportionate share of the said wages to the labourers engaged by them. That, however, is not a matter with which the appellant is directly concerned and for which it can be held to be responsible. Similarly, the bonus that would be paid by the appellant to the contractors would, in theory, be due not only to them, but also to those others who assisted them in the quarry operations. That, however, like the wages, is not a matter with which the appellant is directly concerned and for which it can be held to be responsible. This somewhat anomalous position is the result of the mixed character of employment which workers at the appellants quarries. Even so, we cannot overlook the fact that the amount of bonus which would be paid by the appellant to the contractors would all remain in their hands and is not likely to reach the labourers who assisted them. Under these unusual circumstances, we think, Sri Vimadalal is right when he contends that we should reduce the amount of bonus ordered to be paid by the tribunal. The direction which we propose to issue in this behalf of determined obviously on a purely ad hoc basis and should not be regarded as a precedent between the parties in future and should not be treated as affording any guidance in other disputes of a like nature. We have taken in to account the amount of bonus paid by the appellant to itsemployees who areand we have come to the conclusion that having regard to the number of contractors who are now found to be the appellants employees and the wages paid to them, it would, on the whole, be fair and just that the appellant should be directed to pay to the respondents who are found to be the workmen of the appellant Rs. 30, 000 by away of bonus for58 each year, instead of Rs. 30, 000 and Rs. 40, 000 respectively. In regard to the question of the distribution of the said amounts of bonus, we direct that the said amounts should be distributed amongst the workmen of the appellant in proportion to the annual wages earned by them during to the annual wages earned by them during the relevant years respectively, and rounded off to the nearest rupee.The last point which calls for our decision is in respect of the direction issued by the tribunal that the rates of wages prescribed by it by consent of parties as regards several items of work should take effect from 1 May, 1959. Sri Vimadalal contends and we think, rightly, that this retrospective payment of additional amounts would benefit only the contractors and not the labourers who assisted