IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No 10673 of 2000 with CIVIL APPLICATION NO 9972 OF 2000 For Approval and Signature: Hon'ble MR.JUSTICE H.K.RATHOD ============================================================ 1. Whether Reporters of Local Papers may be allowed : YES to see the judgements? 2. To be referred to the Reporter or not? : YES 3. Whether Their Lordships wish to see the fair copy : YES of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? : NO -------------------------------------------------------------- FOOD CORPORATION OF INDIA WORKER'S UNION Versus FOOD CORPORATION OF INDIA -------------------------------------------------------------- Appearance: MR MIHIR J. THAKORE for AMAR N BHATT for Petitioner Ms. Sangeeta N. Pahwa for M/S THAKKAR ASSOC. for Respondent No.1 to 5. MR SR SHAH for Respondent No. 6 Mr. D.J. Bhatt for the applicants in C.A.No.9972/2000. -------------------------------------------------------------- CORAM : MR.JUSTICE H.K.RATHOD Date of decision: 17/11/2000 ORAL JUDGEMENT Jawaharlal Nehru, the first Prime Minister of this Republic while dreaming of elevating the lot of the common man of this country, once stated; "Our final aim can only be a classless society with equal economic justice and opportunity to all, a society organized on a planned basis for the raising of mankind to higher material and cultural levels. Everything that comes in the way will have to be removed gently, if possible, forcibly, if necessary, and there seems to be little doubt that coercion will often be necessary." These were his prophetic words about three decades back. More than a quarter of century has run out since he left us but there has yet been no percolation in adequate dose of the benefits the constitutional philosophy stands for to the lower strata of society. Tolstoy wrote: "The abolition of slavery has gone on for a long time. Rome abolished slavery. America abolished it and we did it but only the words were abolished, not the thing." Perhaps, what Tolstoy wrote about abolition of slavery in a large sense applies to what we have done to the constitutional echos. It has still remained on paper and is contained in the book. The benefits have not yet reached the common man. What Swami Vivekanand wrote in a different context may perhaps help a quicker implementation of the goal to bring about the overdue changes for transforming India in a positive way for transforming India in positive way and in fulfilling the dreams of the Constitution fathers. These were the words of the Swami : "It is imperative that all this various yogas should be carried out in practice. Mere theories about them will not do any good. First we have to hear about them, then, we have to think about them. We have to reason the thoughts out, impress them on our minds and meditate on them; realize them, until at last they become our whole life. No longer will religion remain a bundle of ideas or theories or an intellectual assent, it will enter into our very self. By means of an intellectual assent, we may today subscribe to many foolish things, and change our minds altogether tomorrow. But true religion never changes. Religion is realization, not talk, nor doctrine, nor theories, however beautiful they may be. It is being and becoming, nor hearing or acknowledging. It is the whole soul's becoming changes into what it believes that is religion." In this petition, notice has been issued by this court on 11th October, 2000 and status quo was ordered in respect of the service conditions of the workmen concerned as enumerated at Annexure "A" to the petition. Thereafter, interim order has been passed by this court (Coram: D.H. Vaghela,J.) on 19th October, 2000 which is continuing even today. In this petition, affidavit in reply has been filed by respondents no.1 to 5 and the rejoinder thereto has been filed by the petitioner which is also on record. Respondent No. 6 has filed civil application no. 9900 of 2000 for being joined as a party to the proceedings which has been allowed by this court by order dated 18th October, 2000 with the consent of the parties. Civil Application NO. 9972 of 2000 has been filed by one faction of the petitioner union for being joined as a party to the main petition i.e. special civil application no. 10673 of 2000. The main petition and the application has been filed by one union because of the internal rivalry between the office bearers of one union. Brief facts of the present petition are that the petitioner is a union of the employees including employees working under the contractors engaged by the respondent Food Corporation of India ("FCI" for short) and the members of the petitioner union, being the citizen of India, are entitled to all the fundamental rights guaranteed under the Constitution of India. The respondent No.1 FCI is public sector corporation set up under the Food Corporation Act, 1964 and is a statutory body discharging statutory functions. The entire capital is provided by the Central Government and the management is virtually appointed and controlled by the Central Government and is, thus, a State within the meaning of Article 12 of the Constitution of India. It is alleged that the respondent FCI being a State within the meaning of Article 12 has been adopting an arbitrary policy of employing different kind of food handling labour for the same kind of work and making different types and quantum of wages and fringe benefits. The categories of workers performing the same functions and duties are of four types: (i) Departmental labour who are regular employees of the respondent corporation and who have prescribed pay scales and large numbers of fringe benefits as are normally available in the public sector undertakings. Approximately, there are 250 depots under this system. (ii) Contract labour who are employed by the respondent FCI through the intermediary of a handling contractor who pays workers working for him at an abysmally no rate devoid of any fringe benefits and they are no better than bonded labour without any fair wages, fixed duty hours,paid weekly of days, OT wages, security of job etc. The bulk of depots of the respondent FCI are under this system. The number of such depots would be around 1400. This sort of quasi departmentalized labour who work under the direct supervision and control of the corporation management and paid directed by the corporation management without any intermediary contractor. These labourers are paid on piece rate basis with guaranteed minimum wages with skeletal fringe benefits like paid weekly off, three paid national holidays, CPF, ex gratia in lieu of bonus first paid and gratuity. At present, there are 200 depots under this system. According to the petitioner, productivity linked piece rate system on "no work no pay" basis whereunder there is no intermediary handling contractor and there is direct employer employee relationship between the corporation and the workman but they are purely on piece rate basis and without any fringe benefits. Prior to 1970, the corporation was getting the work of food handling done through middle man known as food handling contractors. However, on account of persistent demand of the union, the employers entered into specific agreement with the union on 23.5.1973 in this behalf, as per which the employer agreed to departmentalize the work force in all the depots in a chased manner. Initially, the departmentalization was done in 10 depots. The union continued to mount its pressure not only at the level of collective bargaining but also by taking resort to the courts of law as a result of which the Corporation was obliged to progressively bring more and more depots under departmental system which has now gone upto approximately 250 depots. However, the corporation has been still perpetuating the exploitative contract labour system in the vast majority of the depots through country. It is the case of the petitioner that the workers of the petitioner union who are 489 in number are doing the work of putting grains in jute bags and transport the same. SO, it is absolutely perennial work. The petitioners have further alleged that in fact, there are 489 workers working through different contractors engaged by the respondent no.1 FCI from the to time. The petitioner submits that the contractors engaged by the respondent no.1 herein go on changing from the to time by but the workers remain the same. The petitioner has further alleged that lastly, the members of the petitioner union were working under the contractor Shiv Handling Agencies engaged by the respondent No.1 However, said contract period of the said contract is now over. That since the contract period of earlier contractor has expired on 4.10.2000, the respondent FCI engaged another new contractor and would also ask such new contractor who may be engaged to bring his own workers, thereby ignoring the claim of the workers i.e. members of the petitioner union who have been working since last nine years with the different contractors of the respondent FCI. That as a matter of fact, even when the said employees served through different contractors and contractors went on changing, the members of the petitioner union remained the same and, therefore, respondent FCI is now duty bound to direct the new contractor whoever is engaged to the workers whose names are listed in annexure "A" since they have been working since last eight years. That as stated above, these workers are doing the work of first respondent FCI which is of perennial nature like preparing jute bags of food grains and transporting the same and so far as the contractor is concerned, he is merely a camouflage and merely an intervening agency and for all practical purposes, the employees whose names are listed at annexure "A" are working under the respondent no.1 of course under the contractor engaged by the first respondent who is merely a camouflage. The petitioner has, therefore, prayed for directing the respondent no.1 FCI not to give the aforesaid work which the employees named at list annexure "A" are doing any other workers and further to consider the employees listed at Annexure "A" for permanent employment under the first respondent directly and with a further prayer to direct the respondent No. 5 to initiate appropriate proceedings under the Act for prohibiting employment of contract labour in the godown of respondent no.1 at Gandhidham. The petitioners has produced at annexure "A" list of the workers who are members of the petitioner union and at annexure "A" copy of the bipartite settlement dated 4.7.1999. On behalf of the respondents no. 1 to 5, affidavit in reply has been filed which is at page 60 of the petition wherein the respondent FCI has contended that the petition involves various disputed questions of fact which cannot be gone into in a petition under Article 226 of the Constitution; that no fundamental rights of the petitioner union's members are infringed and the petition is therefore required to be dismissed; that the members of the petitioner union are members of M/s. Shiv Handling Agencies who had engaged the workmen for handling and transportation of food grains at the Gandhidham Depot. It is submitted that the contract with M/s. Shiv Handling Agencies has already come to an end on 4.10.2000 and before expiry of the contract of the previous contractor, the respondent FCI had issued tenders for award of contract by public advertisement. Thereafter, the corporation has ultimately appointed new contractor M/s. Sangam Transport Corporation and the work has been already given to the new contractor prior to 4.10.2000 and the new contractor has taken the charge after obtaining requisite labour licence on 11.10.2000. The said respondent has further contended that as per the terms and conditions of the contract, M/s. Sangam Transport Corporation will have to bring its own labours for execution of the contract of handling and transportation and that the respondent FCI does not engage labourers directly and the labourers are not the employees of the respondent FCI and it is clear that there is no master and servant relationship between the workers and the FCI and as such, the petitioners cannot claim any relief against the respondent FCI. The respondent FCI has further contended that the questions as to whether the members of the petitioner union are the contract labourers or not; whether they are working since many years or what was the duration for which they were engaged, nature of processes etc. are required to be examined after appropriate trial by the court constituted under the I.D. Act and such questions cannot be appropriately dealt with and decided by this court in a petition under Article 226 of the Constitution. It is also submitted by the said respondent that the appropriate government has not issued any notification abolishing the contract labour in respect of the respondent Corporation in respect of Gandhidham depot and, therefore, the workmen of the petitioner union have no any right for absorption in the respondent corporation. It is also submitted that if the petitioner union has any grievance, it may approach the labour court or the appropriate government under the provisions of section 10 of the Contract Labour (Regulation and Abolition) Act, 1970 and the petitioner is required to be relegated to the said remedy since the petition involves disputed questions of fact. It is also submitted that the contractors are changed every two years and incoming contractor is not under the obligation to engage the same labourers. In view of this, the statement of the petitioner that all the workers are working since last eight years cannot be accepted. It is further submitted that in view of this, even otherwise, the corporation is unable to find out whether they were working since last eight years or not as alleged. It is further submitted that the recessive handling agencies is a sister concern of M/s. Ayub Bachu & Co. who were previous contractors and, therefore, it may be possible that both the contractors have engaged old workers. It is also submitted that the payment of wages to the casual labourers is always arranged by contractor in presence of the depot officers who counter signs wage cum muster roll. It is submitted that the contractor arranges for payment to these workers as per the rates fixed by the central / State Labour ministry. It is further submitted that the respondent FCI is engaged in the handling and transportation of the food grains which are the essential supplies and that in view of the interim order passed by this Court, the respondent corporation is unable to provide the essential articles to the public distribution system and that the new contractor is unable to bring his own workmen in view of the ad interim orders passed by this court. It is further submitted that the workers of the petitioner union are not responding to the work. In the process, the respondent corporation is not able to get the work done through any set of workmen and as a result thereof, the public distribution system is suffering. In view of the above premises, the respondent FCI has prayed that this petition be dismissed and the interim relief granted earlier be vacated. Against the reply filed by the respondent FCI, the petitioner union has filed affidavit in rejoinder wherein the deponent of the said affidavit in rejoinder has submitted that the last contractor under which the said 489 contract labourers were working was one Shiv Handling Agencies who was awarded the contract at Gandhidham depot from 5.10.98 till 4.10.2000. Said contract labourers were working as such with the first respondent under several other contractors such as Noor Mohammad Ibrahim, Caroo Converse and Ayub Bachu and Co. It is also contended in the said rejoinder that the said 489 contract labourers have also been issued identity cards signed by the contractor Shiv Handling Agencies and countersigned by the Asstt. Manager Depot FSD/SPG, FCI Gandhidham. It is also submitted that even the first respondent has vide its letter dated 24.8.2000 issued to the contractor Shiv Handling Agencies informed the said contractor about allotment of PF Account Numbers to the workers. It is also submitted that the members of the petitioner union 489 in number as per annexure "A" to the petition are ready and willing to work under the new contractor and that in between this period of eight years, four different contractors were engaged by the first respondent and said contractors have taken work from the members of the petitioner union and that the said members have, therefore, legitimate expectation for continuing to be engaged as such and for absorption as regular workers of the first respondent. That they have legitimate right and expectation to be preferred for the contract labour work. It is denied that the workers are not reporting for work as alleged or that they have not started work or that the workers are insisting that the new contractor Sangam Transport Corporation should also not engage other workmen who are not in the list or that they are insisting to engage workmen who do not possess any identity card to show that they were the workmen of the previous contractor. It is contended that he has been informed that the letter purported to have been signed by 36 contract labourers purporting to be dated 13.10.2000 which is produced alongwith the affidavit in reply appears to be in the hand writing of the employees of the new contractor and does not appear to have been signed by all the thirty six contract labourers mentioned therein. It is specifically contended that the new contractor has been adopting all sort of unscrupulous methods so as to defeat the rights of the members of the petitioner and to create confusion. It is submitted that if the interim relief granted earlier by this court is vacated, then, the serious prejudice will be caused to the members of the petitioner and their right to livelihood will be jeopardized. It is submitted that the members of the petitioner are aware that the public distribution system should not suffer in this famine like situation and on behalf of the petitioner union, the deponent of the said affidavit in rejoinder has assured that the members of the petitioner union shall make all the endeavors to see that the public distribution system does not suffer because of the members of the petitioner union. I have heard the learned advocates for the respective parties. Learned advocate Mr. Thakore for the petitioner union has submitted that the petitioner union's members are working since more than eight years with different contractors engaged by the first respondent FCI and that the nature of work is perennial and in such situation, it is the duty of the first respondent which is a State Authority to absorb the members of the petitioner union as a direct employee of the respondent no.1 FCI. He has further submitted that in reality, work of the respondent FCI has been carried out under the guise of engaging contractor which is in reality nothing but camouflage sham and bogus just to deprive the workers from their legitimate rights and claims of having minimum wages and their service conditions which are available to regular employees of the respondent FCI. He has relied upon the decision of the apex court All India General Mazdoor Trade Union versus Delhi Administration and others reported in 1995 Supp. (3) SCC 579. He has also relied upon the decision of the apex court in case of Air India Statutory Corporation versus United Labour Union reported in 1997 (9) SCC 377 and has also relied upon the apex court's decision in case of GEB TPS Ukai versus United Mazdoor Sabha reported in AIR 1995 SC 1893. As against that, learned advocate Mr. S. R. Shah appearing for respondent No. 6 contractor has relied upon the decision of the apex court in case of Dena Nath and others versus National Fertilizers Ltd. and others reported in AIR 1992 SC 457 and also in case of FCI Bombay and others versus Transport & Dock Workers' Union and others reported in (1999) 7 SCC 59. He has also submitted that the decision in case of Air India Statutory Corporation on which Mr. Thakor has placed reliance has been referred to the larger Bench of the apex court for hearing and therefore, the decision in case of Air India Statutory Corporation (supra) cannot be considered by this court and the petitioner cannot rely upon the same and the petitioner is also not entitled to the benefits of the said decision. He has further submitted that there is no terms and conditions in the contract which would require to engage the old contract labourers by the respondent no.6 new contractor and if the court passes any orders directing the new contractor to engage any old contract labourers, it would amount to modifying the terms and conditions of the contract entered into between the respondent No.1 FCI and the contractor respondent No. 6 which is not within the jurisdiction of this court. He has also objected the interim arrangement directed by this court by order dated 19th October, 2000 and has opposed to such interim relief and has requested for vacation of such interim orders with a submission that it is affecting the work of the respondent No. 6 is suffering and ultimately the work of the respondent NO.1 FCI is suffering. He has submitted that the respondent No. 6 is having legal and valid contract licence under the provisions of the Contract Labour (Regulation and Abolition) Act, 1970 and no provisions of the said Act have been violated by the respondent No. 6 and, therefore, no order adverse to respondent No. 6 should be passed by this court in these proceedings. He has also submitted that the appropriate Government has not issued any notification prohibiting contract labour system at Gandhidham Depot and, therefore, respondent NO. 6 is entitled to carry out the contract work and contractual obligations with the first respondent by engaging his own workers and the court cannot restrain respondent No. 6 in engaging his own workers for performing the contract work with the respondent No.1 FCI. He has submitted that in such situation, if the petitioner union is having any grievance against the first respondent, then, they should approach the appropriate machinery under the Contract Labour (Regulation and Abolition) Act, 1970 or under the Industrial Disputes Act, 1947 and such questions cannot be decided by this court in a petition under Article 226 of the Constitution of India. Learned advocate Ms. Sangeetaben Pahwa appearing for the first respondent FCI has made such similar submissions as has been made by Mr. Shah for the new contractor and has submitted that no notification has been issued under section 10 by the appropriate Government putting ban on contract labour system at Gandhidham and, therefore, the respondent no.1 is entitled to give contract of labour to respondent No. 6 and according to the terms and conditions of the said contract, the respondent No. 6 - contractor is entitled to engage his own labourers and that the respondent No. 6 is not under obligation to engage the members of the petitioner union and that the respondent No. 6 is having valid and legal licence under the law and, therefore, in such a situation, when the disputed questions of law and facts have been raised in this petition, this court should not interfere with the same and should not pass any orders for determination of such highly disputed questions of fact and law. Learned advocate Mr. Bhatt appearing for the faction of the petitioner union has filed civil application for being joined as a party to the petition and has submitted that there are other members of the applicant union to whom Mr. Bhatt is representing. He has submitted that