1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY APPELLATE SIDE WRIT PETITION NO.3086 OF 2008 M/s. Garda Chemical Ltd. ...Petitioner. Vs. It's Workmen represented by Sarva Shramik Sangh & Anr. ...Respondents. .... Mr.C. U. Singh, Senior Advocate with Mr. M.V. Joglekar and Mr. Rahul D. Oak for the Petitioner. Ms.Hutoxi Tavadia with Mrs. H.V. Kode for Respondent No.1. Mr. P.N. Anaokar for Respondent No.2. ..... CORAM :DR.D.Y.CHANDRACHUD, J. April 30, 2008. P.C.: Rule, by consent of Counsel returnable forthwith. Counsel appearing on behalf of the Respondents waive service. By consent of Counsel and at their request taken up for hearing and final disposal. The Petition arises out of an award passed by the Industrial Tribunal on 19th November 2007, on a reference to adjudication under 2 Section 10 of the Industrial Disputes Act, 1947. The Petitioner has an industrial establishment at Dombivli in which a Canteen is statutorily required to be maintained under Section 46 of the Factories' Act, 1948. The Canteen employees sought permanency in the service of the Petitioner which is the principal employer. A Canteen contractor has been appointed to look after the Canteen and in accordance with the obligation imposed by Section 46(2) of the Factories Act, 1948 and Rule 79 of the Factories Rules, a Canteen Committee exists to carry out the statutory obligations in relation to the Canteen. At the interlocutory stage, an order was passed by the Industrial Tribunal, directing the maintenance of status quo in respect of the employment of the workmen. While confirming the interlocutory order, a Learned Single Judge of this Court had by an order dated 25th August 2005 observed that it was necessary for the Union to prove that the Petitioner is, in fact, the employer and that the contractor is a sham and bogus or only a name lender. The award of the Industrial Tribunal would show that the first issue which was framed was whether the contract entered into by 3 the Petitioner with the Canteen Contractor – Krishna Caterers, was sham or bogus or the contractor was only a name lender. The Tribunal, however, observed that whether or not the Canteen contract was sham or bogus or only a paper arrangement was “not the issue”. Similarly, the Tribunal observed that it could not be said as to whether the contract which was arrived at between the parties under the Contract Labour (Regulation and Abolition) Act,1970 was genuine or sham, bogus or a camouflage. The Tribunal nonetheless proceeded to allow the reference and directed the management to grant monetary and consequential benefits of permanency to all the workmen of the Canteen. On behalf of the Petitioner, it has been submitted that the Tribunal has manifestly failed to consider the material evidence, more particularly, the admission of the witness who deposed on behalf of the workmen during the course of the cross-examination. Learned Counsel submitted that the witness admitted that the appointment and control of the Canteen workmen was with the Contractor; wages were paid by the Contractor and applications for loans and leave were 4 decided by the Contractor. The work of the Canteen workmen was admitted to be supervised by the Contractor's supervisor. The Provident Fund and ESI payments were effected by the Petitioner in terms of a statutory requirement. The finding of the Tribunal in the impugned award, it was urged, is directly in the teeth of the admitted evidentiary position and cogent documentary evidence on the record. Prima facie, even a bare reading of the award of the Tribunal would disclose that material aspects of the evidence have not been considered by the Tribunal. The first witness for the Union (U.W. 1 K.K. Nair) in the course of his cross-examination stated that a Manager and two supervisors were working in the Canteen; that there was an agreement between the Canteen Contractor and the Company and prior to 15th February 1991 which was the date of the agreement, the concerned workmen were not in the employment of the Company. The Canteen Committee, it was admitted, was formulated in accordance with the Factories' Rules. It is the Canteen Contractor who had admittedly taken disciplinary action. The Canteen Committee regulated and checked the entire affairs of the 5 Canteen including the quality of the food and snacks. U.W. 2, M.S. Kushti admitted that there was a Canteen Committee and that the menu of the Canteen was finalised by the Canteen committee. Work such as cleaning and sweeping was carried out and was supervised by the Canteen committee. The Canteen Committee checked the quality of the food. Wages were being paid by the Canteen Contractor and all raw materials required for the use of the Canteen were purchased by the Canteen Contractor. The witness stated that the leave and loan applications were submitted to the Canteen Contractor and it was the Canteen Contractor who had appointed the witness. U.W. 3 A.K. Chavan, deposed that the Canteen Committee consisted of representatives of the workers and the management and it was the Canteen Committee which looked after the quality of food and all other grievances related to the Canteen facilities. The witness admitted that it was the Canteen Contractor who had appointed Supervisors. This evidence ought to have been given due weight and consideration. The Industrial Tribunal, despite framing an issue as to 6 whether the Canteen Contract was sham and bogus, declined to answer the issue. Having framed the issue, the Tribunal held that the question as to whether the Canteen Contract was sham or bogus or only a paper arrangement, is in fact, 'not the issue'. On the other hand, the Tribunal held that it could not be said as to whether the contract which was arrived at under the Contract Labour (Regulation and Abolition) Act, 1970, was genuine or a sham or a bogus arrangement or otherwise. There is merit in the submission which has been urged on behalf of the Petitioner that there has been an abdication of judicial function by the Tribunal on the one hand and a manifest failure of justice resulting from a failure to consider the material aspects of the evidence, on the other. The petition would have warranted admission and a continuation of the interim order that was passed by a Learned Single Judge of this Court on 25th August 2005 directing the maintenance of status quo in respect of the service of the Canteen employees. However, at the hearing, both, Counsel appearing on behalf of the Petitioner and Counsel appearing on behalf of the Respondents 7 agreed in stating before the Court that it would be in the interests of justice if, with the consent of the Learned Counsel, the impugned award of the Tribunal is quashed and set aside and the proceedings are remitted back to the Tribunal for reconsideration of the reference afresh. Since Learned Counsel have agreed by consent to an order of remand and to the setting aside of the award to facilitate a fresh decision, this Court has in the course of the present judgment considered it appropriate to indicate broadly the infirmities in the approach of the Tribunal in the present case. While deciding the reference on remand, the Tribunal shall consider the submissions of the parties. In order facilitate a fresh determination, it would be necessary to clarify that this Court has not entered any conclusive or binding finding, one way or the other, on the merits of the rival contentions which would arise in the reference. In these circumstances, by consent, the award of the Industrial Tribunal dated 19th November 2007 is quashed and set aside. Reference (IT) 24/2003 shall stand restored to the file of the Industrial Tribunal at Thane. The parties shall appear before the Industrial Tribunal on 23rd June 2008 so that necessary directions can be issued by the 8 Tribunal for the expeditious disposal of the Reference. In the meantime, having regard to the circumstance that the interim order passed by this Court on 25th August 2005 held the field during the pendency of the reference, that order of status quo shall continue to remain in operation until the reference is disposed of. Rule is made absolute in the aforesaid terms. No order as to costs. ......