Case: Vst Inds. Ltd Vs. Vst Inds. Canteen Workers Union

The appellant is a company incorporated underthe Companies Act, 1956 with the object of manufacture and sale of cigarettes. Members of general public are the shareholders and the shares of the company are traded in through various stock exchanges in the country. A petition was filed under Article 226 of the Constitution by respondent No. 1 seeking for a writ of mandamus to treat the members of the respondent-union who are employees working in the canteen of the appellants factory as employees of the appellant and for grant of monetary and other consequential benefits. The canteen is provided in the factory premises of the appellant pursuant to Section 46 ofthe Factories Act, 1948 [hereinafter referred to as `the Act], which obliges a factory employing more than 250 workmen to provide such a canteen. On behalf of the respondents, it is contended that the appellant had been managing the canteen up to the year 1982 and thereafter introduced the contract system for maintaining the canteen so established; that though the management of the canteen had been entrusted to the contractors from time to time, the personnel employed in the canteen were retained by all the contractors and they have been paid salaries through contractors; that the workmen employed in the canteen have been provided with ESI benefits under the Code No. VST, the appellant, and benefits arising under the Employees Provident Funds Act are also provided similarly; that the appellant has also provided a building along with furniture, utensils, cutlery, gas, electricity, water supply and other facilities; that the contractor is engaged only to prepare the food and serve it to the employees and that the quality of the food and the rates are controlled by the management of the appellant.2. On behalf of the appellant, contention was raised that no writ would lie against the appellant inasmuch as the appellant is a company, which is not an authority or a person against whom a writ would lie. It was submitted that they do not discharge any public duty and hence the writ cannot be issued. On the merits of the matter, the appellant disputed various questions of fact and urged that the decision of this Court in Parimal Chandra Raha v. Life Insurance Corporation of India, 1995 Supp. (2) SCC 611 : 1995(3) SCT 248 (SC), would not be applicable to the appellant in the facts and circumstances of the case. The learned Single Judge, who decided the matter in the first instance, held that a writ would lie against a company under a private management following the decision in T. Gattaiah v. Commissioner of Labour, 1981(2) LLJ 54, in which it was held that establishment of a canteen and its maintenance is a statutory requirement; under Section 46 of the Act a public duty is imposed on the company to establish and maintain the canteen; inasmuch as members of the respondent-union are working in the canteen they are entitled to seek a mandamus. He, therefore, held that when a public duty is called upon to be discharged by a private management, a writ of mandamus would lie and could be issued under Article 226 of the Constitution. He thus rejected the contention.3. On the merits of the matter, the learned Single Judge followed the decision in Parimal Chandra Rahas case holding that when the duty had been enjoined on the appellant to provide and maintain a canteen facility under the Factories Act it becomes the obligation of the appellant to establish a canteen and that is what the appellant had done. Therefore, when that work is got done through somebody else by providing the necessary infrastructure and other facilities, when the personnel did not change though the contractors changed from time to time, he held that they become employees of the appellant. On that basis the learned Single Judge granted reliefs sought for by the respondents, however, imposing certain restrictions with regard to the age, being medically fit, on the date of the writ petition, had put in a minimum of three years of continuous service and such service prior to the attainment of the minimum qualifying age under the company should be ignored.4. On appeal, the Division Bench of the High Court affirmed the view taken by the learned Single Judge. The Division Bench referred to their decision in Rakesh Gupta v. Hyderabad Stock Exchange Ltd., Hyderabad and others, AIR 1996 AP 430, that a writ in the nature of mandamus, certiorari and prohibition are recognised as public law remedies and are not available to enforce private law rights. However, noticing that the expression `any person or authority used in Article 226 of the Constitution should not be confined only to statutory authorities and instrumentalities of State but would cover any other person or body performing public duty. The form of the body concerned is not very much relevant. What is relevant is the nature of the duty imposed on that body. The duty must be judged in the light of positive obligation owed by the person or authority to the affected party, no matter by what means the duty is imposed. On that basis, the Division Bench of the High Court dismissed the writ appeal. Hence this appeal.

Reasoning:
10. In the present case, the finding recorded by the learned Single Judge on examination of the facts available is that there had been a canteen within the premises of the appellant up to the year 1982 and it is only from 1982 onwards the management of the canteen has been entrusted to a private contractor; that even after change of the contractor, the canteen workers have continued to be the same irrespective of the change in the contractors from time to time; that wages were paid to the workmen in the canteen by the management through the contractor; that the appellant has provided the accommodation, furniture, fuel, electricity, utensils, etc.; that the management exercises control over the standard in quality, quantity and the rate of the food items supplied to the workmen for whose benefit the canteen is established. Thus, these circumstances clearly indicate that the appellant has a complete control over the activities in respect of the canteen and the contractor has absolutely no discretion either in regard to the menu, quality and quantity of the food items much less the rate at which the same are supplied to the workmen. When the management of the appellant exercises such a complete control, the canteen shall be deemed to be run by the management itself. The appellant in any manner cannot controvert these facts.11. We do agree that the respondents have a strong case on merits. Since we have held that the High Court had no jurisdiction to entertain a petition under Article 226 of the Constitution, we would have set aside the order made by the High Court. However, in the special features of the case, although we do not agree with the High Court on the first question raised, we feel, after clarifying the legal position, that we should not disturb the decision given by the High Court.