AJN 1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION APPEAL NO.369 OF 2008 IN WRIT PETITION NO.1487 OF 2005 Mr. Baburao K. Malgaonkar .... Appellant Vs. Karwa Commercial Private Limited. .... Respondent Mr. N.M. Ganguli i/b Mr. R.S. Upadhyay for the appellant. Mr. P.C. Pawaskar with Mr. Neel Helekar for the respondent. CORAM : SMT. RANJANA DESAI & K.K. TATED, JJ. DATE ON WHICH THE ORDER IS RESERVED : 17TH NOVEMBER, 2008. DATE ON WHICH THE ORDER IS PRONOUNCED : 28TH NOVEMBER, 2008. P.C. :- 1. The appellant has challenged in this appeal order dated 30/7/2008 passed by learned Single Judge in Writ Petition No.1487 of 2005. By the impugned order, learned Single Judge has allowed AJN 2 the writ petition. 2. The statement of claim made by the appellant discloses his case. According to him, he joined the respondent-company as an “office boy” in the year 1989. He was a permanent workman in the employment of the respondent-company. On 16/2/1995, his services were orally terminated. No reasons were assigned for the termination. He, therefore, sent a demand letter on 12/5/1995 claiming reinstatement with full back-wages and continuity of service with effect from 16/2/1995. The respondent-company did not accede to his demands. He, therefore, approached the Deputy Commissioner of Labour, Mumbai, for admitting his demand in the conciliation proceedings. Conciliation Officer submitted a failure report and, hence, the Deputy Commissioner of Labour submitted a reference under sub-section I of section 10 and sub-section 5 of section 12 of the Industrial Disputes Act, 1947 (for short, the said Act) to the Labour Court. According to the appellant, the respondent-company has committed breach of section 25F of the said Act; the respondent-company has not issued any charge- sheet to him; the respondent-company has orally terminated his services and the respondents-company has violated the provisions AJN 3 of the model standing orders applicable to the workmen. According to the appellant, his services were terminated because he raised his grievances before the Labour Commissioner. He claimed that since his termination was illegal, he is entitled to reinstatement with full back-wages. 3. The respondent-company denied the case of the appellant by filing its written statement. The respondent-company claims to be a company engaged in the business of trading in cement manufactured by Larsen & Toubro and Cement Corporation of India. It claims to act as a commission agent for the said companies. The respondent-company submitted that the appellant was in the habit of disregarding the orders given by the Directors in relation to his work. He used to pick quarrels. He was several times advised to be careful, but there was no improvement in his work. He was issued three notices by the respondent-company. Several complaints were received about his misbehaviour. He also gave letters of apology. However, he refused to mend his ways and, hence, his services were terminated on the ground of loss of confidence by letter dated 16/2/1995. The case of the respondent- company is that the appellant was a part-time employee. The AJN 4 respondent-company also contended that it was not an industry within the meaning of section 2(j) of the said Act and, hence, the reference was not tenable. 4. The Labour Court partly allowed the reference. It held that the respondent-company is an “industry” within the meaning of the said Act. It further held that the services of the appellant were illegally terminated. Reinstatement of the appellant with full back- wages was ordered. 5. The respondent challenged this order. Learned Single Judge was of the opinion that the respondent-company is not an “industry” within the meaning of the said Act. He, therefore, set aside the order passed by the Labour Court. The appellant is aggrieved by the said order. 6. We have heard, at some length, Mr. Ganguli, learned counsel appearing for the appellant. Mr. Ganguli submitted that learned Single Judge erred in holding that the respondent is not an industry. He submitted that learned Single Judge wrongly placed the onus on the appellant. According to Mr. Ganguli, it was the AJN 5 duty of the respondent-company's witness to bring to the court, the record to show that apart from the appellant and the respondent- company's witness Mr. Murthy, there were no other employees working with the respondent-company. It was further the respondent-company's duty to establish that the seven employees, who according to the appellant, were working with the respondent- company are not its employees. Learned counsel submitted that learned Single Judge erred in placing reliance on the judgment of the Supreme Court in Bangalore Water Supply and Sewerage Board v. A. Rajappa & Ors. AIR 1978 SC 548 and the judgment of this court in Umashankar Jaswal v. Royal Auto Centre, 2007 1 CLR 928. He submitted that the present case is not covered by the ratio of the said judgments. He submitted that the respondent- company answers all tests of an “industry”. The reference was, therefore, perfectly tenable. Learned counsel urged that the impugned order, therefore, be set aside. 7. We have also heard Mr. Pawaskar, learned counsel appearing for the respondent-company. AJN 6 8. In Bangalore Water Supply's case (supra), the Supreme Court held that for an undertaking to fall within the ambit of Section 2(j) of the said Act, it must have the following ingredients (i) systematic activity, (ii) organized by co-operation between employer and employee and (iii) production and/or distribution of goods and services calculated to satisfy human wants and desires. 9. In this case, the respondent-company is acting as a commission agent. This is admitted by the appellant in his evidence. In his cross-examination, the appellant stated that the Directors of the respondent-company are looking after the work of supply of cement to customers. He further stated that after receiving the orders from the customers, the respondent-company used to intimate to the cement companies to supply cement directly to the customers. He further stated that the respondent-company used to get the commission from the cement companies as it was an agency. He further stated that the respondent used to contact the parties on telephone in respect of the payments. When specifically asked whether the respondent-company has a godown, the appellant gave evasive replies. He denied the suggestion that AJN 7 there was no godown belonging to the respondent-company. But, he stated that he did not remember the address of its godown. It is pertinent to note that in the statement of claim filed by the appellant, he has not mentioned that the respondent has a godown. In the cross-examination, he stated that he had told his counsel while drafting the statement of claim that the respondent- company has a godown and he did not know why this fact is not stated in the statement of claim. In the examination-in-chief, he stated that there are seven employees working with the respondent-company. He, however, did not give their names. It is only in the cross-examination that he gave the first names of all those alleged six employees. The respondent-company examined its Director Mr. Karwa. Mr. Karwa stated that apart from him, there are other Directors by name Mr. Shreevallabh Karwa, Mr. Jaichandlal Karwa and Mr. N.K. Karwa. Therefore, it is clear that this is a family business. Mr. Karwa stated that the Directors of the respondent-company used to book orders on behalf of Larson & Toubro and Cement Corporation of India, on phone. The said companies used to arrange for their own transport for delivery of cement to the respective parties. They used to send the bills to the respondent-company after effecting the delivery. The respondent- AJN 8 company used to send the bills to the parties for collecting payments. Mr. Karwa further stated that the respondent-company is working as commission agent and that the appellant has no role in the above transaction/activities of the respondent-company. He was employed as a part-time employee. Mr. Karwa further stated that there are other companies situated in the premises where the respondent-company is situated and, the employees whose names have been given by the appellant are working in those companies and not in the respondent-company. 10. From this evidence, it appears to us that learned Single Judge has rightly concluded that the respondent-company is basically a family run business which did not engage more than two employees for doing incidental works. There was no co- operation between the employer and employee in the main activity of the respondent-company which is trading in cement. There is no existence of any organized or systematic activity. There is no systematic activity comprising co-operation between the employer and employee on a scale necessary to fulfill the definition of the expression “industry”. The appellant has not led any evidence to establish that apart from him, there were any other employees AJN 9 working with the respondent-company. Since the respondent- company is a commission agent and the business is run by the family on a small scale, there is no question of their maintaining any muster rolls so as to produce them in the court. We are unable to agree with Mr. Ganguli that it was the respondent-company, who should have established that those alleged seven employees were not working with it. The appellant should have at-least led some foundation for this claim. In the examination-in-chief, he did not give even the names of the said employees. It is only in the cross- examination that he has given first names of the alleged employees. There is no dent made by the appellant in the evidence of Mr. Karwa, the Director of the respondent-company in the cross-examination. In the circumstances, in our opinion, learned Single Judge has rightly concluded that the respondent- company is not an “industry”. Reliance placed on the judgment of this court in Umashankar Jaswal's case (supra) is also apt. In that case also, the company had engaged only two employees. The company had a small shop dealing with automobile spare parts and the material on record did not establish the existence of an organized or systematic activity comprising co-operation between AJN 10 the employer and employee on a scale necessary to fulfill the definition of the expression “industry”. Relying on the judgment of the Supreme Court in Bangalore Water Supply' s case (supra), this court held that the company was not an “industry” within the meaning of section 2(j) of the said Act. In our opinion, in this case, the employment of the appellant is in the nature of private and personal employment for doing miscellaneous odd jobs. Judgment of this court in Umashankar Jaiswal' s case (supra) is clearly applicable to it. By no stretch of imagination, the respondent- company can be called an “industry”. The impugned judgment and order, therefore, merits no interference. The appeal is dismissed. [SMT. RANJANA DESAI, J.] [K.K. TATED, J.]