K. Kannan, J.
I. The 3 issues urged for consideration:
1. The issues that stand out for consideration before this Court are the tenability of retrenchment of employment meted out to the workman after a compensation given to the workman by the management in purported compliance of Section 25-F of the Industrial Disputes Act, but was challenged to be inadequate on the ground that he was a 'workman in an industrial establishment, which was employing more than 100 workmen and the relevant provision which was applicable was Section 25-N of the Industrial Disputes Act. The compensation as contemplated under the latter Section was not paid to him and hence, the termination was stated to be bad. Another ground which was urged on behalf of the workman was that there had been juniors to him, who had been retained in service while he was discriminated for a treatment of discharge on the ground that he had been rendered surplus and hence, there had been a violation of Sections 25-G and 25-H of the Industrial Disputes Act. The last point of contention, which was urged on behalf of the workman, was what is stated before this Court for the first time namely, that during the pendency of the proceedings, a fresh advertisement had been issued for recruitment to the same post in which he was employed and therefore, the cause for termination as a workman having been rendered surplus was not any longer available and the management was to re-employ the workman instead of going for fresh recruitment. It was urged on behalf of the workman that the petitioner had actually filed a writ petition challenging the advertisement but this Court was pleased to dismiss the writ petition granting the liberty to the workman to approach this Court for appropriate reliefs. The petitioner has, therefore, filed Civil Miscellaneous Petition to consider his case for re-employment even if reinstatement was not possible.
II. The disposition before the Labour Court
2. The case has had a chequered history. The petitioner had been terminated from service along with a host of others by order dated 18.07.1991 with effect from the following day namely, 19.07.1991. The termination had been challenged by 8 workmen, who had been aggrieved by the order of termination in Civil Writ Petition No. 14161 of 1991. The writ petition had been allowed and the respondent-management had preferred LPA No. 822 of 1992 before a Division Bench of this Hon'ble Court. The whole focus of argument related to whether the workmen were entitled to the benefit of Section 25-N of the Industrial Disputes Act and as a consequence whether the respondent was an industrial establishment as defined under Section 25-L of the Industrial Disputes Act and whether the provisions of Chapter V-B were applicable to them.
The Division Bench, while allowing the appeal and setting aside the order of the Single Judge, held on 24.08.1993 that there was no prima facie proof of the contention raised on behalf of the workman that it was an industrial establishment. It did not, however, rule also in favour of the management wholly, when it observed that the Bench was not making a final recording of the finding that the Corporation could not be called an industrial establishment. It observed that it was a question of fact which had to be determined on appropriate proceeding after opportunity was given to the parties to lead evidence in support of the respective contentions. The Bench held that effective alternative remedy was a reference through an adjudication before the Labour Court and the writ petitioners were given liberty to take proceedings under the Industrial Disputes Act. The dispute came to be referred to the Labour Court through various individual references made through claim statements of the individual workmen. The award impugned was one of the references rejecting the claim made by the workman. The Labour Court found that the workman had not let in any independent evidence after the disposal of the case by the High Court and there was no proof that the respondent management was an industrial establishment to which the provision under Chapter V-B of the Industrial Disputes Act would apply. It found that the compensation given to the workman under Section 25-F was sufficient compliance of law and that the workman could not have any remedy before the Labour Court. Adverting to the contentions of the workman that there had been violation of Sections 25-G and 25-H also, the Labour Court held that the cases of other workmen, who were said to have been juniors, had not been concluded and that there were still pending. Making specific reference to one Satyawan alleged to be a junior workman, the Labour Court accepted the contention of the management that the case of Satyawan was still pending and two other persons, who had been said to be juniors namely, Smt. Satya Devi and Smt. Kiran Bala, had been appointed on compassionate grounds being dependents of ex-employees, who died in harness, and hence, they belonged to a different category of workmen and, therefore, the principles under Sections 25-G and 25-H could not be applied.
III. Industrial adjudication of another workman as regards the same management -relevant but not binding
3. At the forefront of the arguments, the learned Counsel appearing for the petitioner pointed out to the fact that yet another workman, who had been visited with an order of retrenchment along with the workmen by the same order, had raised a dispute before the Labour Court where the Labour Court had directed reinstatement on a finding that the retrenchment was against industrial rules. The matter went up to Hon'ble Supreme Court and in the case of Haryana Land Reclamation and Development Corporation Limited v. Nirmal Kumar : (2008)2 S.C.C. 366, the Court had found that the direction for reinstatement as affirmed by the High Court, was not to be disturbed and made a modification only with the issue relating to back wages. The learned Counsel appearing for the workman refers to this decision as exhibiting the conduct of the management when they had not denied the status as industrial establishment and the applicability to Section 25-N that was found in favour of the workman. The contentions raised by the management to defeat the claims of the workman in the case, according to the learned Counsel for the petitioner, had not been urged before the Hon'ble Supreme Court and the respondent was, therefore, estopped from taking a different contention with reference to the case of the petitioner alone. The learned Counsel also relied on another case with reference to yet another workman namely Ramesh Kumar son of Babu Ram where the Labour Court had already taken a view that it was an industrial establishment and the termination made in violation of Section 25-N was bad. According to him, the management had also reinstated the workman in compliance of the directions of the Labour Court and they were not justified in taking up the defence denying the petitioner a right of reinstatement.
4. The finding of the Hon'ble Supreme Court affirming the decision taken by the Labour Court and the High Court in relation to Nirmal Kumar had been only as regards the claim to back wages when the Court had considered that the Corporation was running under the loss and the full back wages shall not be granted to the workman. The issue whether it was an industrial establishment or not was itself not shown to have been taken up. Again the finding of the Labour Court in the reference sought at the instance of another workman, Ramesh Kumar through yet another reference, is denied by the management as having become final and the determination that the management was an industrial establishment could have no value for the petitioner. I have no difficulty in seeing that neither the decision of the Hon'ble Supreme Court which did not render an adjudication on the issue whether the management was industrial establishment nor an adjudication by the Labour Court in yet another case as regards the applicability of Section 25-N could constitute a binding decision as against the management to be fettered in raising the objections which are raised before me now and which were found acceptable by the Labour Court. However, those decisions have an evidentiary value which shall be taken note of at an appropriate time when the issue is considered on its own merits. The consideration on merits becomes relevant in view of earlier finding given already by a Division Bench of this Court in LPA No. 822 of 1992 that there was no prima facie proof that the Corporation was an industrial establishment and that it was required to be proved only before the Labour Court.
IV. The test for 'industrial establishment'
(a) The meaning of factory'
5. To establish the applicability of Chapter V-B, the learned Counsel appearing on behalf of the workman urged that the 'industrial establishment' defined under Section 25 L included a 'factory' as defined in Section 2 (m) of the Factories Act, 1948. According to him, the definition of 'factory' was expansive enough to render the respondent Corporation obtain to such status. The definition under the Factories Act would, therefore, be required to be reproduced here:
(m) 'factory' means any premises including the precincts Thereof
1. whereon ten or more workers are working, or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power, or is ordinarily so carried on, or
ii) whereon twenty or more workers are working, or were working on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on without the aid of power, or is ordinarily so carried on,-
but does not include a mine subject to the operation of the Mines Act, 1952 (35 of 1952) or a mobile unit belonging to the armed forces of the Union, railway running shed or a hotel, restaurant or eating place.
For computing the number of workers for the purposes of this clause all the worker in different groups and relays in a day shall be taken into account;
For the purposes of this clause, the mere fact that an Electronic Data Processing Unit or a Computer Unit is installed in any premises or part thereof, shall not be construed to make it a factory if no manufacturing process is being carried on in such premises or part thereof.
(b) The expansive meaning of 'manufacturing process'
6. The relevance of Section will have to be examined only in the context of whether the activity engaged by the Corporation involves a 'manufacturing process', which has been defined under Section 2(k) of the Factories Act and it shall be useful to reproduce the same here:
(k) 'manufacturing process' means any process for
i) making, altering, repairing, ornamenting, finishing, packing, oiling, washing, cleaning, breaking up, demolishing, or otherwise treating or adapting any article or substance with a view to its use, sale, transport, delivery or disposal, or
ii) pumping oil, water, sewage or any other substance; or
iii) generating, transforming or transmitting power; or
iv) composing types for printing, printing by letter press, lithography, photogravure or other similar process or book binding;
v) constructing, reconstructing, repairing, refitting, finishing or breaking up ships or vessels; or
vii) preserving or storing any article in cold storage.
7. It may be seen that the manufacturing process includes making of an article or substance with a view to use sale transport, delivery or disposal. The contention of the learned Counsel appearing for the workman that the retrenchment of notice issued on 18.07.1991 specifically dealt with the nature of activity of the Corporation in the following words:
The Corporation is engaged in the business of Land Levelling, Land Reclamation, Production of Quality Seeds and sale of gypsum and various fertilizers, pesticides, insecticides farm machinery engaging number of employees of various categories on regular as well as adhoc/DPL basis. Gypsum is generally sold by the dealers while other business is carried out by the employees of the Corporation.'
(emphasis supplied)
According to the learned Counsel for the workman, the Corporation had admitted to its activity as including production of quality seeds. Though the mere sale of gypsum and various fertilizers, pesticides etc. may not be a manufacturing process, the production of quality seeds involved activity in fields that cannot be done without a manufacturing process. The learned Counsel refers to the Full Bench decision of this Court in Employees State Insurance Corporation v. Bhag Singh (1988)94 P.L.R. 1 dealing with the provisions of Employees State Insurance Act and its applicability to persons in 'pumping operation'. The reference to decision assumes significance where a Full Bench was referring to the activity in the light of the definition 'manufacturing process' as found under Section 2(k) of the Factories Act. The Full Bench had held 'It is not necessary that a commercially different product must come out of the process' dealing with petrol pump and service station. The Full Bench had held
It will not be justified to give a very narrow construction to the definition of 'manufacturing process' so as to restrict its application only to a work place where by virtue of the manufacturing process a commercially different article is produced.' Underscoring the need to adopt an expansive definition in line with the object of the Act, the Full Bench had held that the Act was intended to protect the workers employed in factories against industrial and occupational hazard and securing to them condition of employment conducive to their health, safety, welfare, proper working hours and other benefits, the Full Bench had held the provisions to be applied to all 'work places'.
(c) Instances of 'manufacturing processes'
8. The learned Counsel appearing for the workman refers to several decisions of the Hon'ble Supreme Court and of High Courts detailing expansive interpretations to the 'manufacturing process' that include preserving and storing articles in cold storage (The Kumbakonam Milk Supply Cooperative Society, represented by its Secretary v. Regional Director, Employees' State Insurance Corporation, Madras : 2003(3) L.L.J. 416); repair work of tractors and harvest combines (The Punjab Agro Industries Corporation Limited v. The Presiding Officer, Labour Court and Ors. : (2006-2)143 P.L.R. 267); purchase of milk and selling it after storing it in cooler for storage (Vellipalayam Co-op Milk Supply Society v. Regional Director, Employees' State Insurance Corporation 2004 L.I.C. 2715); rolling of beedis in residence of workers (Rajangam, Secretary District Beedi Workers Union v. State of Tamil Nadu and Ors. : 1991 A.I.R. Supreme Court 216;) packing of materials (E.S.I. Corporation v. Dave Griha Udyog : 2001-1 L.L.J. 42); receiving products in bulk and after unpacking such bulk products pack them according to customer's requirement (Parry & Co. Ltd. v. Presiding Officer, II Additional Labour Court, Madras and Ors. 1998 I L.L.J. 406), as falling within the definition of 'manufacturing process'. None of the decisions have any direct bearing to the issue at hand but they all go to show that any minor activity in whatever way that goes towards a process of manufacture should fall within the meaning of manufacturing process.
(d) Production of seeds involves human intervention, which is a 'manufacturing process'
9. In this case, the activities of the establishment includes production of quality seeds which requires a human endeavour of a particular process that would result in securing new seeds. A manufacture itself implies a change, though every change may not be manufacture but every change of an article or substance is the result of a treatment of labour and manipulation. While defining the expression of 'manufacture', the Hon'ble Supreme Court said in Union of India v. Delhi Cloth and General Mills : A.I.R. 1963 Supreme Court 791, that there must be transformation; a new and different article must emerge having a distinct name, character or use. Although the above decision is with reference to 'manufacture' in the context of tax law, it has a bearing to understand the concept of manufacture. Manufacture itself is the end result of one or more processes through which the original commodities are made to pass. A process being an activity, by the operation which is integrally connected with the manufacture and an activity being an operation carried on at the intermediate stage of manufacture, it may not by itself bring out any change in the commodity. The natural meaning of the word 'process' is a mode of treatment of certain materials (see paragraphs 14 and 20 in CCE Commissioner of Central Excise v. Rajasthan State Commercial Works : 1991(4) S.C.C. 473). A production of quality seeds does not come from the blue; it grows out of earth. If it is merely a natural process of growth with no human intervention, it may not fall within the definition of a manufacturing process, but if a human element is involved that produces quality seeds, it is inconceivable that the seeds could arrive without a 'manufacturing process'. It may be that even after the direction of a fresh enquiry into fact by the Division Bench in LPA No. 822 of 1992, the workman did not avail to himself an opportunity of giving any additional evidence on the nature of activity, but still he was relying on an admission of the nature of activities which the management was engaged in by reference to the order in retrenchment when he was canvassing for an expansive interpretation of the expression 'manufacturing process', with reference to the admission made, I do not think it should compel me to look for any new evidence. Admission is invariably the best evidence available to bind the party and the management cannot deny that their activities do not include the production of quality seeds. That itself, in my view, is sufficient to bring it within the definition of 'industrial establishment' as mentioned in Section 25-L of the Industrial Disputes Act. (e) The activity in head office is to aid the activity of manufacture - hence, part of the industrial establishment
10. The workman had to anyway traverse one more obstacle, viz., that the application of Chapter V-B itself would arise only in case of an establishment in which not less than 100 workmen were employed on an average for working day. The contention of the management in the written statement was that the workman was employed in the head office where not more than 50 or 60 persons were working and therefore, the persons working in the head office of the Corporation were to be treated as working in a distinct industrial establishment and hence, the provisions of Chapter V-B will not be attracted. Again the definition of 'industrial establishment or establishment' contained under Section 2(ka) reads thus:
(ka) 'Industrial establishment or undertaking' means an establishment or undertaking in which any industry is carried on:
Provided that where several activities are carried on in an establishment or undertaking and only one or some of such activities is or are an industry or industries, then,-
(a) if any unit of such establishment or undertaking carrying on any activity, being an industry, is severable from the other unit or units of such establishment or undertaking, such unit shall be deemed to be a separate industrial establishment or undertaking;
(b) if the predominant activity or each of the predominant activities carried on in such establishment or undertaking or any unit thereof is an industry and the other activity or each of the other activities carried on in such establishment or undertaking or unit thereof is not severable from and is, for the purpose of carrying on, or aiding the carrying on of, such predominant activity or activities, the entire establishment or undertaking or, as the case may be, unit thereof shall be deemed to be an industrial establishment or undertaking.
If there are several activities carried on in an establishment and only one or some of the activities in an industry, then any unit which is severable from the other unit shall be deemed to be a separate industrial establishment. The definition in Clause (b) states that if the predominant activity is that of an industry and the other activity is not severable and is for the purpose of carrying on or aiding the carrying on of such predominant activity, then the entire establishment or undertaking shall be deemed to be an industrial establishment. A head office is really in the nature of the brain for an organization to propel its activities. The field or the earth where the seeds were manufactured may be the heart, belly and legs and the head office is the cerebral matter that pilots its activities. The head office exists for the purpose of carrying on or aiding the carrying on of the activity either in parts or of the whole. While it may have been possible to treat a head office as completely an independent unit if there existed no nexus between what takes place in the field and how it is handled at the head office, a comprehensive look at how the personnel at various places in various responsibilities of the same establishment functioned would show that one cannot exist without the other. The admitted case is that the Corporation itself employed more than 500-600 men and women and the workmen at the head office must also be taken only as part of the same establishment which is engaged in the production of quality seeds.
V. Retrenchment notice not in conformity with Section 25 N is invalid
11. If the activities of the Corporation are included in the definition of manufacturing process to which the protection of Chapter V-B are applicable, then the retrenchment notice which was issued, in compliance of Section 25-F of the Industrial Disputes Act, cannot avail to the establishment to contend that there was a compliance of retrenchment notice. A workman in an industrial establishment, who will have to be retrenched shall be served with notice under Section 25-N, which provides for three months' notice in writing indicating the reasons for retrenchment. Admittedly such notice had not been issued and the workman was entitled to such notice. It is in this context that the conduct of the management in not denying its status as industrial establishment assumes significance, when the Hon'ble Supreme Court was deciding the case of another workman Nirmal Kumar being found entitled to notice under Section 25-N and availing to the workman a right of reinstatement with back wages alone restricted to Rs. 10,000/-. Workmen in the same organisation engaged in the same activity as another of the same category cannot be treated differently as regards termination. What is good for the goose is good for the gander . What shall be applied to Nirmal Kumar in the fitness of things and homogeneity of treatment, shall be applied to the workman in this case also.
VI. Retainment of junior workmen under different category - burden of proof on management, not discharged
12. The workman had also complained of violation of Sections 25-G and 25-H and argued that the persons, who had been subsequently appointed, had been retained and even regularized. The management did not deny that there were three cases of persons, who were juniors to the workman, who had been retained. The justification was that one of them was Satyawan. The contention of the management was that the case was pending as regards Satyawan and he had been also retrenched. As regards two other persons, they had been treated as falling within a different category of persons who had to be given employment on the basis of a compassionate appointment scheme. The learned Counsel appearing for the workman contended that the statutory requirement of the principle enunciated through Sections 25-G & H of the 'last come first go' and 'first come last go' admits of no exceptions and the applicability of the compassionate appointment scheme itself is not excepted by the scheme of the Industrial Disputes Act. While I reject such a contention that Section 25-G or 25-H does not admit of any exceptions, I would hold that exception will always have to be proved by the person who sets up the exception. It shall be perfectly admissible for the management to prove that there existed a particular scheme of employment amongst the category of persons, who were to be considered for appointment on compassionate considerations. The scheme must be first of all proved. A statement in defence does not by itself substitute the requirement of proof. Even in service jurisprudence, the compassionate appointment is always seen as an exception to Article 14 of the Constitution and Courts have invariably held that because it constitutes an exception to the salutary principle of equality guaranteed under Article 14 of the Constitution, it should be strictly construed. There cannot be employment otherwise than under the scheme. If it is admitted that there were two other persons, who were juniors to the petitioner, who had to be appointed on compassionate scheme, it behoves on the management to prove the said scheme and illustrate that the two workmen, who had been appointed in preference to the workman, who was admittedly a senior, the circumstances for consideration of such appointment on compassionate considerations. In this case, I find no documents had been filed. The compassionate appointees have themselves not been examined, factors that went into consideration for such appointment, are also not before the Court. I, therefore, find that the management on whose shoulder rested the burden to show that the junior employees were entitled to consideration over the claims of the petitioner, had failed to establish the justification for such favourable consideration. The claim of the workman for reinstatement had not been shown to have been displaced for justifiable reasons.
VII. Subsequent event not considered
13. The learned Counsel appearing for the workman also argued on the subsequent event of the conduct of the management in issuing fresh advertisement for the same post. I do not think, it is necessary to enter into any adjudication on the same, having regard to the findings that I have rendered that the retrenchment made by the management shall not valid in the eye of law. The claim of the workman for reinstatement, under such circumstances, is bound to succeed. The award of the Labour Court is set aside and the workman is entitled to reinstatement, if he had not already reached the age of superannuation. The litigation has proceeded more than two decades and for the all period that he had not worked, he shall not be entitled to full back wages in the same manner as the Hon'ble Supreme Court dealt with the case of another workman. The workman shall be entitled to only 25% of back wages.
VIII. Conclusion
14. The writ petition is allowed granting to the workman reinstatement with continuity of service and back wages as referred to above, with cost assessed in favour of the workman at Rs. 10,000/-.