Civil Writ Petition No.7014 of 1987 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** Civil Writ Petition No.7014 of 1987 Date of Decision:11.09.2008 M/s Pioneer Sports Works (P) Ltd., Nakodar Road, Jalandhar .....Petitioner Vs. The Presiding Officer, Labour Court, Jalandhar and others .....Respondents CORAM:- HON'BLE MR. JUSTICE HARBANS LAL Present:- Mr. P.K. Mutneja, Advocate for the petitioner. None for the respondents. **** HARBANS LAL, J. This petition has been moved by M/s Pioneer Sports Works (P) Ltd., Nakodar Road, Jalandhar under Articles 226/227 of the Constitution of India for quashing the impugned award dated 19.2.1987 (Annexure P.3). The brief facts giving rise to this petition are that Lachhman Dass – respondent joined the service of the petitioner in April, 1979 as Tennis Guttingman on piece rate basis. He was earning about Rs.600/- per month. The Management was not marking his attendance. On this, he made a complaint to the Labour Inspector, Jalandhar. This act of his annoyed the employer. On demand of bonus and leave encashment from the employer, his services were terminated with effect from 22.6.1983 without any charge- sheet or show cause notice. Lal Chand – respondent joined the service of the petitioner in January, 1978 as Tennis Guttingman on piece rate basis. He was earning about Rs.550/- per month. Surinder Kumar- respondent also joined the service of the Civil Writ Petition No.7014 of 1987 -2- petitioner in June, 1973 as Tennis Guttingman on piece rate basis. He was earning Rs.500/- per month. Lal Chand as well as Surinder Kumar have adopted similar pleas. The case of the petitioner is that these persons were never employed. Therefore, the question regarding their termination does not arise, nor can they invoke the provisions of Section 2-A of the Industrial Disputes Act, 1947 (for short, `the Act'). The following issues were framed by the learned Presiding Officer of the Labour Court:- 1. Whether there is a relationship of master and servant between the parties? 2. If issue No.1 is proved, whether termination of services of workman is justified and in order? 3. Relief. After hearing the representatives of the parties, the learned Presiding Officer of the Labour Court vide the impugned award directed the reinstatement of the workmen with full back-wages. In their joint written statement, the workmen- respondents No.2 to 4 have inter-alia pleaded that the petitioner has tried to introduce the facts, which neither surfaced in the evidence nor put to the answering respondents when they appeared as witnesses. The petitioner- firm employs the person like the answering respondents to do the work of gutting on the tennis and squash rackets which is done at its premises and under its control. The employees doing such type of work are paid on piece-rate basis. The answering respondents used to report for duty and leave the office at fixed hours. The material was being supplied by the employer and if anything went wrong, the same used to be rejected and no payment was to Civil Writ Petition No.7014 of 1987 -3- be made for the such material, meaning thereby that the employer had complete control on the answering respondents. The work of gutting was a part and parcel of the basic work as without gutting, no racket could be completed. The answering respondents had taken up the case by putting a complaint to the Labour Inspector about the unfair labour practice being adopted by the petitioner – firm, being not independent contractors. They were the employees doing the work themselves in the factory with the tools supplied by the Management. There was a contract of service existing between the parties. Lastly, it has been prayed that this petition may be dismissed with costs. None had put in appearance on behalf of the respondents. I have heard the learned counsel for the petitioner, besides perusing the findings returned by the Labour Court. Mr. P.K. Mutneja, Advocate appearing on behalf of the petitioner strenuously urged that the petitioner- Company is manufacturing tennis and squash rackets gutting of which is got done through outside agencies, i.e., independent contractors on contract basis. The rackets and gutting nets are provided by the Company to the independent contractors for which regular gate passes are issued so that they are able to take the raw material outside the factory premises. They do gutting work at their homes or in any case at places of their convenience outside the factory premises of the petitioner- Company. After completing the same, the gutted rackets are returned to the petitioner- Company and entry is allowed to them on showing their gate passes. Then they are paid according to quantity of work done by them. If the Management finds that the gutted rackets could not conform to the prescribed standards or in any other way are not upto the Civil Writ Petition No.7014 of 1987 -4- mark, the work done by the contractor is rejected and no payment is made for the rejected rackets. There were no fixed hours of duty for these contractors. They were at liberty to come to the factory premises at any time to collect the raw material. They could complete the work at any time within the specified period. The payment to these contractors were made on vouchers. The duly stamped receipts were executed by them in token of their having received the amount. It was open to the Management not to give any work to any particular contractor. This clearly goes to show that there was no element of control or supervision by the Management over these workmen and thus, the relationship of master and servant does not exist between the parties. The names of respondents No.2 to 4 were not included in the muster rolls or in the wages register. Their attendance was never recorded in the factory premises. They were not covered by the Employees' State Insurance Scheme framed under the Employees' State Insurance Act, 1948. They being not in the employment of the petitioner- Company were never paid contributions by way of subscriptions. They raised an industrial dispute alleging that their services have been wrongly terminated by the Management, so the dispute was referred to the Labour Court. The workman- Lal Chand in his statement Annexure R.4 has admitted in his cross-examination that he used to work on contract basis and was paid proportionate to the work done by him. The statements of the workmen were not correctly appreciated nor discussed by the Labour Court. In these premises, the impugned award is liable to be set aside. To buttress these stances, he has sought to place abundant reliance upon the observations rendered by the Apex Court in re: M/s Puri Urban Cooperative Bank v. Madhusudan Sahu and another, (1992) 3 Supreme Civil Writ Petition No.7014 of 1987 -5- Court Cases 323 as well as Indian Overseas Bank v. Workmen, (2006) 3 Supreme Court Cases 729. I have given a deep and thoughtful consideration to these submissions. Admittedly, the payment used to be made to all the three workmen on piece rate basis. Now, the question arises as to whether such a person falls within the definition of a workman. Whether the relationship of workman and employer subsisted between the parties. In re: Madhusudan Sahu and another (supra), the appraiser was engaged by the bank purely on commission basis for weighing and testing gold ornaments offerred to be pledged to the bank to secure loans. He executed indemnifying bond for the purpose of holding himself to be responsible to the bank for any loss sustained by the bank. His services were terminable at any time. The Apex Court ruled that such appraiser is not a workman as no relationship of master and servant subsisted between him and the bank. His orders of reinstatement in service without back-wages passed by the Labour Court as well as the High Court were set aside by Hon'ble the Supreme Court. In re: Indian Overseas Bank (supra), the appellant- bank on the basis of contracts, employed a number of “jewel appraisers for loans” in its branches in different States. Claiming that such jewel appraisers were part time workmen, the employees' Union raised a demand for their absorption. Pursuant thereto, a reference was made to the Industrial Tribunal as to whether such demand to treat such jewel appraisers as part-time workmen was justified. The Bank resisted the Union's claim basically on the ground that jewel appraisers were not workmen within Section 2(s) of the Act. The Industrial Tribunal answered the reference in affirmative. The High Court upheld that award. The Bank then filed the appeal. The Apex Court held in Civil Writ Petition No.7014 of 1987 -6- the following terms:- “The appointment of regular employees is subject to the qualification and age prescribed. Their recruitment is made through employment exchange/ Banking Service Recruitment Board. They have fixed working hours and monthly wages and are subject to disciplinary control. Control/ supervision is exercised not only with regard to the allocation of work, but also the way in which the work is to be carried out. There is a retirement age. They are subject to transfer and while in employment they cannot carry on any other occupation. On the other hand, the engagement of jewel appraisers is not subject to any qualification/ age. They are engaged directly by the local Manager. There are no fixed working hours for them and no guaranteed payment. Only commission is paid to them. They are not subject to disciplinary control. There is no control/ supervision over the nature of work to be performed. Their charges are paid by the borrowers. There is no retirement age and no bar to carry on any avocation or occupation. The Bank though has a list of appraisers, it is not obligatory for it to allot work to any particular jewel appraiser. Therefore, the jewel appraisers are not employees of the Bank.” Adverting to the facts of the case at hand, it is a matter of common knowledge that gutting of Rackets requires no particular machinery. It can be done at any place. This work hardly requires employment of workmen as defined in Section 2(s) of the Act. By no process of reasoning, the respondents fulfil the criteria of relationship of Civil Writ Petition No.7014 of 1987 -7- workman and employer as laid down in Madhusudan Sahu and another's case (supra). In their joint written statement, the answering respondents- workmen have categorically admitted that the material was to be supplied by the employer (wrongly described) and if anything went wrong, the same was rejected and no payment was to be made for the rejected material. Further it is in Annexure R.4, the statement of Lal Chand, that “no application was obtained by the Management from me at the time of my employment and no appointment letter was issued to me by the Management. It is correct that the petitioner paid according to the quantum of work done by me. No leave card was issued to me. ESI card was also not issued to me. No bonus was given to me. I was paid proportionate to the work done by me.” It is in Annexure R.1, the statement of Lacchman Dass that “I had not made any application for employment with the respondent concerned. The Management did not issue any appointment letter to me. No ESI card, no leave card and no provident slips were issued to me. Wages were paid to me on vouchers. No bonus was paid to me by the respondent.” It is in Annexure R.6, the statement of Surinder Kumar, that “the persons working in gutting section were not marked present. No leave card, ESI card, no provident fund slips were issued to me. I was not paid bonus by the Management. I made no application for employment to the respondent. No appointment letter was issued to me by the Management. Whatever the work was done by me, the Management issued slips to that effect and I was paid for the same.” This evidence of the workmen proprio- vigore take away the plea of their being employees of the petitioner- Company. It is deducible from this evidence that no relationship of employee and employer was existing between the parties. Had they been Civil Writ Petition No.7014 of 1987 -8- the employees of the petitioner- Company, their presence might had been marked in some register and some identity card would have also been issued to them for enabling them to enter the premises. There is nothing on the record to show that they had fixed working hours or they were being paid monthly wages or they were subject to disciplinary control of the petitioner- Company. They were simply being paid on the basis of piece rate. There was also no retirement age nor there was any bar on them to carry on any other avocation or occupation. The petitioner- Company was at liberty to allocate piece-rate work to anyone else. Thus to conclude finally, they were not the workmen of the petitioner- Company as defined under Section 2(s) of the Act. In the ultimate analysis, the impugned award is found to be illegal, besides being perverse on the face of it. Sequelly, it calls for indulgence in the exercise of writ jurisdiction under Articles 226/227 of the Constitution of India and is set aside by accepting this petition. Disposed of accordingly. September 11, 2008 ( HARBANS LAL ) renu JUDGE Whether to be referred to the Reporter? Yes/No