IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No 5400 of 1998 with SPECIAL CIVIL APPLICATION No 8088 of 1998 For Approval and Signature: Hon'ble MR.JUSTICE H.L.GOKHALE Sd/- ============================================================ 1. Whether Reporters of Local Papers may be allowed to see the judgements? Yes 2. To be referred to the Reporter or not? Yes 3. Whether Their Lordships wish to see the fair copy of the judgement? No J 4. Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? No 5. Whether it is to be circulated to the Civil Judge? No -------------------------------------------------------------- JIVANLAL PRITILAL C/O RAMESH R THAKUR Versus JASHODABEN BABUBHAI PARMAR -------------------------------------------------------------- Appearance: 1. Special Civil Application No. 5400 of 1998 MR AK CLERK for Petitioner MR GM JOSHI for Respondent No. 1 to 12 MR CHUDGAR for NANAVATI ASSOCIATES for Resp.No. 13 2. Special Civil ApplicationNo 8088 of 1998 MR CHUDGAR for NANAVATI ASSOCIATES for Petitioner MR GM JOSHI for Respondents Nos.1 to 12 MR AK CLERK for Respondent No.13 -------------------------------------------------------------- CORAM : MR.JUSTICE H.L.GOKHALE Date of decision: 14/10/98 ORAL JUDGEMENT Special Civil Application No.5400 of 1998 is filed by one Shri Jivanlal Pritilal who claims to be a labour contractor working under M/s. Maneklal Harilal Mill No.1 situated at Saraspur, Ahmedabad. Special Civil Application No.8088 of 1998 is filed by the said Mill Company. Both these petitions seek to challenge the interim order passed by the learned Judge of the Labour Court at Ahmedabad below interim application (Exhibit 2) in Application No.579 of 1997 and the order passed by the Industrial Court in Revision Applications Nos. 5 and 6 of 1998 confirming that order. Mr.Clerk has appeared for aforesaid Jivanlal Pritilal (hereinafter referred to as the Contractor) and Mr.Chudgar has appeared for the Mill Company (hereinafter referred to as the Mill Company). Mr.G.M.Joshi has appeared for 12 lady employees who are respondents Nos.1 to 12 in both these matters. 2. The facts leading to these petitions are as follows: The said Mill Company is a cotton textile mill, the employer-employee relations under which are governed under the Bombay Industrial Relations Act, 1946 (hereinafter referred to as BIR Act, 1946). Respondents Nos.1 to 12 have filed Application No.579 of 1997 under Sections 78 & 79 of the said Act before the learned Labour Court Judge at Ahmedabad, wherein they have prayed for a declaration that they may be declared as employees of the Mill Company. The said prayer has been justified by contending that they have been working in the said Mill Company continuously for years together. They were engaged in the Mending Department and were required to work from 8 a.m. to 4.30 p.m. This mending work was done inside the premises of the Mill Company and that it was an essential work for the purposes of the principal activities of the said employer. In an exhibit annexed to the Application, they mentioned the years in which they have joined in the said Mill Company. The names and the dates given in the annexure are as follows: Sr. Year of No. Name of the employee joining --- --------------------- ------- 1 Jasodaben Babubhai 1994 2 Kashiben Baldevbhai 1993 3 Narmadaben Dahyabhai 1992 4 Ilaben Jagdishbhai 1992 5 Kamlaben Dineshbhai 1994 6 Madhuben Naranbhai 1994 7 Jamnaben Rajendrabhai 1994 8 Jayaben MIlanbhai 1994 9 Leelaben Raghunath 1994 10 Meenaben Jitendrabhai 1993 11 Bhanuben Ramanlal 1993 12 Rekhaben Rajubhai 1996 In that Aplication, it is stated in paragraph 3 that after the cloth is manufactured, it is brought to the mending section for mending the same i.e. to remove defects, if any. Thereafter, the cloth is sent further to other sections for bleaching, finishing etc. They have also stated in paragraph 5 that they are not working in place of any other employee as 'badli' and the work that was done was of a perennial nature. It is further stated in paragraph 5 that they were paid only Rs.30/per day. It is stated in paragraphs 3 & 4 that the employees concerned are entitled to identity cards, privilege leave, pay slips and other necessary documents, but none of them are being given the same and a bogus labour contractor namely Shri Jivanlal Pritilal has been put up between the management and these employees as their employer. 3. In this principal proceeding, the 12 lady employees prayed for interim relief by filing another application (Exhibit 2) under Section 119-D of the BIR Act 1946. In that exhibit 2, it was submitted that, on 1.9.1997 and thereafter on 25.9.1997, the Factory Inspector visited the premises of the Mill Company and found a variety of irregularities. The Factory Inspector met the employees and because they narrated their grievances to him, the employees namely Jashodaben Babubhai Parmar and others were threatened by the concerned Section Officer Mr.Bhujwala of the Mill Company that their services will be terminated. This cause of action led to the interim application wherein they prayed that they should not be restrained from entering in the factory premises nor should the company be permitted to change their work. After examining interim application and hearing the learned advocate for the employees, the learned Judge of the Labour Court passed ad-interim order on 1.10.1997 as sought by the employees. It has come on record that when that notice was sought to be served on the Mill Company, Shri R.M.Shah, Assistant Labour Officer on duty recorded thereon that he had received the notice at 5.30 p.m. on 1.10.1997. He recorded that two out of the 12 ladies were not reporting for work for quite some time and the other ten had not reported on duty on that day and hence there is no occasion for an interim injunction, though whatever was status quo on that day would be maintained. 4. The Mill Company pleaded by its common reply dated 7.10.1997 to the principal application as well as interim application that the employees concerned were engaged through the above-referred contractor and that the principal employer had no responsibility towards the liabilities on account of the workers so engaged. In paragraph 13 of the reply it is stated in the last two lines as follows: "It is not true as claimed by the applicants that the Factory Inspector had come for visit at our place. Actually, the Factory Inspector had seen the attendance cards of the contractor Shri Jivanlal Pritilal and had signed thereon". In paragraph 11 it was disputed that such persons concerned were engaged for years together and in paragraph 12 it was denied that mending process was a part of production. The Mill Company also denied in paragraph 12 that the workers concerned were entitled to photocard, attendance card and card showing privilege leave etc. It is material to note that in this reply, it is nowhere stated that the employees concerned were terminated by the contractor at any point of time or that they were not permitted to enter the Mill Company as instructed by the contractor. 5. Inasmuch as the ladies were not permitted to join on duty (in spite of the court order), an application was filed before the court (Exhibit 8) on 10.10.1997 complaining breach of the interim order and praying for appointing a Commissioner to visit the place of work. Therefore, a Commissioner was appointed to find out as to what was the position. The Commissioner's report was taken on record at Exh.11. The Commissioner has reported that he visited the Mill Company on 17.10.1997, he saw the lady employees waiting to report for duty in the morning at 7.45 a.m.. He also found that the mending department was very much working and Sarvashree Kamalsingh, Amarnath and Joitaram were on duty. The employees on duty stated that they were not given identity cards. The Commissioner recorded that the lady employees present were not permitted to join. 6. The Mill Company produced some documents on 11.12.1997. They were as follows:- (1) Photocopy of the Licence issued to Contractor Shri Jivanlal Pritilal under the Contract Labour (Regulation and Abolition) Act, 1972. (2) Photocopy of Attendance Sheet maintained by the Contractor for the month of July 1997. (3) Photocopy of the Attendance Sheet maintained by the Contractor for the month of August 1997. (4) Photocopy of the Attendance Sheet maintained by the Contractor for the month of September 1997. (5) Photocopy of the Attendance Sheet maintained by the Contractor for the month of October 1997. (6) Photoopy of the Agreement entered into between the Contractor and the petitioner. 7. In view of the plea of the Mill Company that the employees concerned were the employees of the contractor, an application was filed by the employees to join the contractor as respondent and he was thereupon joined in the said proceeding. The learned advocate appearing for the Mill Company has filed his Vakalatnama on behalf of the contractor on 4.2.1998 which is at Exh.23 in the Labour Court. Thereafter, the contractor has filed a reply which came to be marked as Exh.25. In this reply, for the first time, respondent No.2 pleaded in para 8 that these lady employees were performing works of mending saree-buttas and that they were given only such work which was temporary. They were engaged only for one month. They were not doing any other work. It was further stated therein as follows: "It is the submission of respondent No.2 that though this court has passed order for maintaining status quo, before receiving that order, the very workers were relieved from their services since no work was available. Presently, only 15 persons are engaged by me since the work available is less". Here again, what is material to note is that no such relieving order is produced. 8. The learned Judge thereafter heard the Advocates, and in view of this report of the Commissioner as well as the documentary material produced before him, he allowed the interim application and confirmed the ad-interim injunction by his order dated 24.3.1998. 9. Being aggrieved by that interim order, two Revision Applications were filed under Section 84 of the B.I.R. Act being Revision Application Nos. 5 and 6 of 1998. Various arguments on facts and law were advanced before the learned Judge of the Industrial Court. The learned Member of the Industrial Court by his order dated 12.5.1998 confirmed the interim order passed by the learned Labour Court Judge and dismissed the Revision Applications. In para 3 of his operative order, the learned Judge directed the two Revision Applicants to compensate the employees for not permitting them to report on duty from 2.10.1997 to 30.4.1998. 10. When Special Civil Application No.5400 of 1998 came before this court first on 10.7.1998, Pandit J. issued a notice stating that matter will be finally heard on returnable date. Subsequently, the second petition, namely Special Civil Application No.8088 of 1998 was filed by the Mill Company and both were directed to be heard together. When the matters were heard on 22.9.1998 before me, it was noted that both the orders passed by the learned Judge of the Labour Court and the Industrial Tribunal had remained undisturbed for over a year and no actions had been taken either by the Mill Company or by the Contractor to comply therewith. It was seen that necessary documents were not produced by both of them in defence in the courts below and therefore to give them one more opportunity the matter was adjourned to 6.10.1998 on a condition that the wages of 12 employees upto the end of September 1998 be deposited in this court. They were calculated at the rate of Rs.30/- per day for the work of 26 days in a month i.e. Rs.780/- per month per employee. Thus, an amount of Rs.1,12,320/- was subsequently deposited for twelve employees in this court whereafter this matter has been heard finally before me. Before the matter was heard further, I asked the learned Counsel for both the petitioners as to whether they were ready to take back the employees (may be even without prejudice), but on instructions they have declined to agree. They were also asked as to whether in view of the ensuing Diwali, they were agreeable to release at least half of the amount that is deposited in this court, but they have declined to agree to this arrangement also. 11. RULE is issued on both these matters and is made returnable forthwith. Pleadings are already complete inasmuch as reply has been filed by Mr.Joshi and further affidavits have been filed by the contractor. All the learned Counsel have made their submissions before me. 12. Mr.Clerk, learned Counsel appearing for the contractor submitted that this was a case where there was a jurisdictional error on the part of the learned Judge of the Labour Court. He submitted that the workers concerned were terminated from their services and since they were so terminated, the kind of order that was passed by the learned Judge of the Labour Court could not have been passed. He submitted that by the reply filed by the contractor (filed some times after 4.2.1998 as stated above), it was pleaded that their services were terminated and therefore the employees have also subsequently filed separate Applications to challenge their terminations. Mr.Clerk, therefore, relied upon a judgment of the Supreme Court in the case of MANAGEMENT OF NILPUR TEA ESTATE v. STATE OF ASSAM reported in AIR 1996 SC 737 to contend that, in view of the fact of termination of services of the workmen, the application for challenging termination will have to be decided first and until then no such order granting interim injunction or the consequential order of appropriate compensation or wages as passed by the Industrial Court could be passed. Mr.Clerk submitted that the learned Judge of the Labour Court was in error in granting interim relief which amounted to granting full relief. He submitted that the Industrial Court has erred in directing payment of the amounts which ought not to have been done. In this behalf Mr.Clerk relied upon the judgment of the Supreme Court in the case of DELHI CLOTH & GENERAL MILLS CO. LTD. v. RAMESHWAR DAYAL reported in 1961 SC 689 to contend that reinstatement cannot be granted by way of interim relief. He as well relied upon the judgment of the Supreme Court in the case of BANK OF MAHARASHTRA v. RACE SHIPPING reported in AIR 1995 SC 1368 to submit that grant of interim relief which practically gives the principal relief is deprecated. Mr.Clerk relied upon the judgment of the Supreme Court in the case of HIMACHAL PRADESH HOUSING BOARD V. OM PAL & OTHERS reported in AIR 1997 SC 2685 to submit that validity of termination order will have to be decided first before which other application cannot be proceeded with in fact leading to a grant of reinstatement. 13. Mr.Chudgar, learned Counsel for the Mill Company has submitted that the kind of order which was passed by the learned Judge of the Labour Court amounted to granting mandatory relief and in the facts of the present case, the kind of mandatory order that was passed could not have been issued. He relied upon the judgment of the Supreme Court in the case of DORAB CAWASJI WARDEN v. COOMI SORAB WARDEN reported in AIR 1990 SC 867 to submit that the relief of interlocutory mandatory injunction is granted to preserve or restore the status quo of the last non-contested status which preceded the pending controversy. The submission of Mr.Chudgar is that the lady employees have been terminated from their services from 30.9.1997 and that being the position, the ad-interim relief which was granted on 1.10.1997 could not have been confirmed when this was subsequently brought to the notice of the learned Judge. Mr.Chudgar pressed into service the observations made in para 24 and 25 of the above judgment which govern grant of mandatory injunction. Mr.Chudgar also relied upon judgment reported in 1996 Labour & Industrial Cases 885 in the case of BHANMATI TAPUBHAI MULIYA v. STATE OF GUJARAT to submit that just on the last day, an order of status quo was not expected to be passed. That judgment in the case of BHANMATI (supra) was in a situation where the employee concerned had been appointed on ad-hoc basis in State service and just before the period of service was to expire, on the last day she had sought injunction. 14. Mr.Joshi learned Counsel appearing for the workmen concerned submitted on the other hand that both the orders passed by the courts below were perfectly justified in the facts and circumstances of the case. Mr.Joshi submitted that the only record which was produced before the Labour Court consisted of photocopies of attendance sheets for the month of July, August, September and October 1997. It is relevant to note that they were produced by the Mill Company along with its list of documents and not by the contractor. These attendance sheets for four months, if seen closely, show that the names of the employees during each of all these four months are altogether different. It is also seen that the handwriting is also quite different on each sheet. There is nobody's signature on any of the sheets. The names of ten out of that twelve lady employees appear in the attendance sheet of September 1997. Mr. Joshi submitted that, whereas these photocopies were produced on 11.12.1997 (much after the ad-interim order of the Labour Court dated 1.10.1997), the contractor claims to have given an advertisement in Daily Sandesh dated 27.7.1998 stating that on 24.7.1998 while travelling in an autorikshaw he had lost the entire record consisting of salary sheets, diary and other registers which were being carried in a green clothbag. Mr.Joshi, therefore, submits that, in any case, when the learned Judge of the Labour Court as well as the Industrial Court were seized of the matter, as per their own say the contractor as well as the Mill Company had the relevant records. If that was so, nothing prevented them from producing it before the courts below. Mr.Joshi submitted that it was very much the case of the employees concerned right from the beginning that they were employed under the Mill Company right from 1992. Now, if some other employees were being engaged or what these employees were saying was false, nothing prevented the management from showing the relevant record. 15. It is relevant to note that in the licence under the Contract Labour (Regulation & Abolition) Act, 1970 produced by the Mill Company with respect to this contractor, it is stated that the licence has been initially issued on 18.6.1993. That is recorded in para 6 of the Industrial Court order. In that licence it is also recorded that the contractor had taken the licence to engage 16 workmen. If the 12 ladies were contractor's employees and if the management could produce photocopies of the payment sheets of the months of July to October 1997, in the submission of Mr.Joshi, the management as well as the contractor could have produced the relevant record which they are required to maintain under the above-referred Contractor Labour (Regulation & Abolition) Act. Section 29 (1) of the said Act requires the principal employer and every contractor to maintain such records and registers giving particulars of the contract labour employed, nature of work performed by the contract labour, rates of wages paid to the contract labour and such other particulars in such form as may be prescribed. The rules under the Act require the contractor to issue employment card within 3 days of employment and to maintain Muster Roll, Wage Register, Deduction Register and Overtime Register. If they are employees of the Mills, then also under the B.I.R. Act and the Textile Standing Orders, the employees are to be issued passes and the employer has to maintain various registers. Mr.Joshi showed me a copy of Factory Inspector's report of 26.8.1992 which showed largescale violations of all legal requirements by this contractor. It is also relevant to note in this behalf that before the Industrial Court it was canvassed that under the Standing Orders there were many protective measures concerning employees and specific submissions are recorded in para 13.1 of the judgment. In either case there has to be the necessary record. It is pertinent to note that the fact that such record of the contractor is lost is stated on affidavit for the first time in this court on 12.10.1998. Mr.Joshi, therefore, submits that this story of the record being lost is a clear afterthought and that at no point of time any such record ever existed on the basis of which the management or the contractor could contend that the employees were never employed earlier other than the period of 30 days as claimed by them. 16. Admittedly, the employees concerned were being given Rs.30/- per day which is far less than the minimum wage. It is true that labour is very cheap in our country and is available in abundance. It is, therefore, only to protect them that various such enactments and provisions have been made. The Contract Labour (Regulation & Abolition) Act 1970 has undoubtedly brought about much desired improvement. As far as B.I.R. Act is concerned, the definitions of "employee" and "employer" have always been very clear to include the employees engaged by contractor. The employees under the BIR Act had the protective mechanism inbuilt in the Act much prior to the enactment of the Contract Labour (Regulation & Abolition) Act. Mr.Joshi, therefore, submits that the management having produced no documentary evidence worth reliance, the learned Judge of the Labour Court as well as the Industrial Court had no option but to discard the stand taken by the contractor that the employees concerned were engaged only for 30 days whereafter they were terminated. The learned Judge of the Industrial Court has dealt with the kind of record which the management has produced and this can be seen from the discussions in para 14 of the judgment. 17. Mr.Joshi in this behalf relied upon the judgment of the Supreme Court in the case of RAGHAVAMMA v. CHENCHAMMA reported in AIR 1964 SC 136 to contend that when all the relevant documents admitted to have been in existence were not placed before the court by the party concerned, an adverse inference has to be drawn against such party. The submission of Mr.Joshi is well taken. In fact, way back in HIRALAL v. BADKULAL reported in AIR 1953 SC 225 relying upon an earlier judgment of Privy Council reported in AIR 1917 PC, the Hon.'ble Supreme Court explained the rational behind this approach which is inbuilt in Section 106 of the Evidence Act also. The Court observed:- " A practice has grown up in Indian procedure of those in possession of important documents or information lying by, trusting to the abstract doctrine of the onus of proof, and failing, accordingly, to furnish to the Courts the best material for its decision. With regard to third parties this may be right enough - they have no responsibility for the conduct of the suit; but with regard to the parties to the suit it is in their Lordships' opinion, an inversion of sound practice for those desiring to rely upon a certain state of facts to withhold from the Court the written evidence in their possession which would throw light upon the proposition." In H.D.SINGH v. RESERVE BANK reported in AIR 1986 SC 132, the workmen claimed to have worked for more than 240 days in 12 months but bank failed to produce the record in defence. The Supreme Court held that 'in the absence of any evidence to the contrary' the Court had necessarily to draw the inference that the workmen's case was true. Thus, faced with a situation where the workers were contending that they were employed right from 1992 and when the management failed to produce any material in defence, the