1. This appeal is directed against the judgment and order passed by the learned single Judge in CWP No. 2704/2003 dated 30th May, 2003, whereby the writ petition filed by the respondent workers has been allowed and a mandamus has been issued to the first respondent - Union of India to refer the industrial dispute to the Industrial adjudicator.
2. The respondent workers had been working with the appellant, Indian Oil Corporation (IOC for short) for more than two decades as Safai Karamcharies, except for a short period from 19th July 1995 to 20th February, 1996. Before 19th July, 1995, the workers were working for IOC at Delhi but after 20th February, 1996, they were made to work at NOIDA.
3. The respondent workers along with other workers had filed a writ petition being C.W.P. No. 4158/1997 before this Court through their union praying inter-alia issuance of an appropriate writ, order or direction, directing the appellant IOC to treat the workers, including the respondents herein, as their regular employees and not to terminate their services. It was averred in the writ petition that the services of the workers had been continued all through, irrespective of change of the contractors, and IOC had ultimate control over the workers and that the workers were working under the guidelines and supervision of IOC. It was also averred that the workers were employed by IOC through contractors to deprive such workers security of service and various benefits.
4. The appellant, IOC in its counter affidavit had averred inter-alia that the workers covered in the writ petition had raised disputed questions of fact and that the said writ petition was not maintainable in view of the alternate and efficacious remedy available to the workers under the Industrial Disputes Act that could be adjudicated in an appropriated forum.
5. After decision in Steel Authority of India Limited and Ors. v. National Union Water Front Worker and Ors. JT 2001 (7) SCC 268, the workers had raised an industrial dispute before the Labour Commissioner at New Delhi on 17th October, 2001 by filing their statement of claim inter-alia contending that their engagement through contractor was a camouflage and that they were entitled to wage parity. Writ Petition No. 4158/1997 was thereafter disposed of taking note of the fact that the workers had already raised their dispute before the Labour Commissioner.
6. It appears that the on objection of the IOC, Labour Commissioner had held that the industrial dispute was not maintainable in Delhi. Consequently, the workers had filed a fresh claim before the Assistant Labour Commissioner at Dehradun. In the said statement of claim filed by the workers through their Union, it was specifically averred that they had been working under the control and supervision of the management of IOC and that the contract/agreement between the labour contractor and the management of the IOC, was a sham. It was also averred in the said statement of claim that the service condition and the working of the workmen was controlled and supervised by the management of IOC and the contractors were engaged only to deprive the workers of their legitimate rights and benefits including the regularization of their services with the management of IOC. The Under Secretary, Ministry of Labour, Government of India had declined to refer the matter to the Industrial adjudicator holding that prima facie the Ministry did not consider the dispute fit for adjudication for the reason:
The unions could not substantiate their contention for regular appointment by the management of India Oil Corporation.
7. Being aggrieved, the respondent workers had filed the present writ petition, which came before learned single Judge and by the judgment under appeal stood allowed.
8. We have heard Mr. V.N. Kaura, learned Counsel for the appellants and Ms. Asha Jain Madan, learned Counsel for the respondent.
9. In Steel Authority of India's case the Supreme Court has categorically observed as follows:
70. By definition the term contract labour' is a species of workman. A workman shall be so deemed when he is hired in or in connection with the work of an establishment by or through a contractor, with or without the knowledge of the principal employer. A workman may be hired: (1) in an establishment by the principal employer or by his agent with or without the knowledge of the principal employer; or (2) in connection with the work of an establishment by the principal employer through a contractor or by a contractor with or without the knowledge of the principal employer. Where a workman is hired in or in connection with the work of an establishment by the principal employer through a contractor, he merely acts as an agent so there will be master and servant relationship between the principal employer and the workman. But where a workman is hired in or in connection with the work of an establishment by a contractor, either because he has undertaken to produce a given result for the establishment or because he supplies workman for any work of the establishment, a question might arise whether the contractor is a mere camouflage as in Hussainbhai Calicult's case (supra) and in Indian Petrochemicals Corporation's case (supra) etc.; if the answer is in the affirmative, the workman will be in fact an employee of the principal employer; but if the answer is in the negative, the workman will be a contract labourer.
10. In the said decision the Court summarized its conclusions in para 121 and sub-paras 5 & 6 of para 121 and para 122, which are material for our purposes, read as follows:
121 (5) On issuance of prohibition notification under Section 10 of the CLRA Act prohibiting employment of contract labour or otherwise, in an industrial dispute brought before it by any contract labourer in regard to conditions of service, the industrial adjudicator will have to consider the question whether the contractor has been interposed either on the ground of having undertaken to produce any given result for the establishment or for supply of contract labourer for work of the establishment under a genuine contract or is a mere ruse/camouflage to evade compliance of various beneficial legislations so as to deprive the workers of the benefit thereunder. If the contract is found to be not genuine but a mere camouflage, the so-called contract labourer will have to be treated as employees of the principal employer who shall be directed to regularize the services of the contract labourer in the concerned establishment subject to the conditions as may be specified by it for that purpose in the light of para 6 hereunder.
121(6) If the contract is found to be genuine and prohibition notification under Section 10(1) of the CLRA Act in respect of the concerned establishment has been issued by the appropriate government, prohibiting employment of contract labourer in any process, operation or other work of any establishment and where in such process, operation or other work of the establishment the principal employer intends to employ regular workmen he shall give preference to the erstwhile contract labourer, if otherwise found suitable and, if necessary, by relaxing the condition as to maximum age appropriately taking into consideration the age of the workers at the time of their initial employment by the contractor and also relaxing the condition as to academic qualifications other than technical qualifications.
122. We have used the expression 'industrial adjudicator' by design as determination of the questions aforementioned requires inquiry into disputed questions of facts which cannot conveniently be made by High Courts in exercise of jurisdiction under Article 226 of the Constitution. Therefore, in such cases the appropriate authority to go into those issues will be industrial tribunal/court whose determination will be amenable to judicial review.
11. Following the decision of Steel Authority of India's case, in Dhanbad Colliery Karamchari Sangh v. Union of India and Ors. : 1991ECR439(SC) , the Supreme Court had set aside the decision of the Government declining the reference on similar grounds. In case of Municipal Corporation of Greater Mumbai v. K.V. Shramik Sangh 2002 (4) SCC 600, the Supreme Court had de hors the notification under the Contract Labour Regularization Act, permitted the workers to raise an industrial dispute without prejudice to their right to approach the authority under the said Act.
12. Mr. V.N. Kaura, appearing for the appellant, however contended that in view of a subsequent decision of the Constitution Bench in Secretary, State of Karnataka v. Umadevi : (2006)IILLJ722SC the law laid down by the Constitution Bench in Steel Authority of India's case stands modified in respect of the regularization of the contract workers of Government and Public Sector Undertakings. It was submitted that Umadevi's case deals with public employment, absorption, regularization or permanent continuance of temporary, contractual, casual, daily wage or ad hoc employees appointed/recruited and continued for long in public employment de hors the constitutional scheme of public employment. Our attention was specifically drawn to paragraphs 12 and 34 of the Umadevi's judgment, which read as under:
12. What is sought to be pitted against this approach, is the so called equity arising out of giving of temporary employment or engagement on daily wages and the continuance of such persons in the engaged work for a certain length of time. Such considerations can have only a limited role to play, when every qualified citizen has a right to apply for appointment, the adoption of the concept of rule of law and the scheme of the Constitution for appointment to posts. It cannot also be forgotten that it is not the role of courts to ignore, encourage or approve appointments made or engagements given outside the constitutional scheme. In effect, orders based on such sentiments or approach would result in perpetuating illegalities and in the jettisoning of the scheme of public employment adopted by us while adopting the Constitution. The approving of such acts also results in depriving many of their opportunity to compete for public employment. We have, therefore, to consider the question objectively and based on the constitutional and statutory provisions. In this context, we have also to bear in mind the exposition of law by a Constitution Bench in State of Punjab v. Jagdip Singh and Ors. : (1966)ILLJ749SC . It was held therein, 'In our opinion, where a Government servant has no right to a post or to a particular status, though an authority under the Government acting beyond its competence had purported to give that person a status which it was not entitled to give, he will not in law be deemed to have been validly appointed to the post or given the particular status...
34. ...Thus, it is clear that adherence to the rule of equality in public employment is a basic feature of our Constitution and since the rule of law is the core of our Constitution, a Court would certainly be disabled from passing an order upholding a violation of Article 14 or in ordering the overlooking of the need to comply with the requirements of Article 14 read with Article 16 of the Constitution. Therefore, consistent with the scheme for public employment, this Court while laying down the law, has necessarily to hold that unless the appointment is in terms of the relevant rules and after a proper competition among qualified persons, the same would not confer any right on the appointee. If it is a contractual appointment, the appointment comes to an end at the end of the contract, if it were an engagement or appointment on daily wages or casual basis, the same would come to an end when it is discontinued. Similarly, a temporary employee could not claim to be made permanent on the expiry of his term of appointment. It has also to be clarified that merely because a temporary employee or a casual wage worker is continued for a time beyond the term of his appointment, he would not be entitled to be absorbed in regular service or made permanent, merely on the strength of such continuance, if the original appointment was not made by following a due process of selection as envisaged by the relevant rules. It is not open to the court to prevent regular recruitment at the instance of temporary employees whose period of employment has come to an end or of ad hoc employees who by the very nature of their appointment, do not acquire any right. High Courts acting under Article 226 of the Constitution of India, should not ordinarily issue directions for absorption, regularization, or permanent continuance unless the recruitment itself was made regularly and in terms of the constitutional scheme. Merely because, an employee had continued under cover of an order of Court, which we have described as 'litigious employment' in the earlier part of the judgment, he would not be entitled to any right to be absorbed or made permanent in the service. In fact, in such cases, the High Court may not be justified in issuing interim directions, since, after all, if ultimately the employee approaching it is found entitled to relief, it may be possible for it to mould the relief in such a manner that ultimately no prejudice will be caused to him, whereas an interim direction to continue his employment would hold up the regular procedure for selection or impose on the State the burden of paying an employee who is really not required. The courts must be careful in ensuring that they do not interfere unduly with the economic arrangement of its affairs by the State or its instrumentalities or lend themselves the instruments to facilitate the bypassing of the constitutional and statutory mandates.
13. According to Mr. V.N. Kaura, in the light of the decision in Umadevi's case, the earlier decision in Steel Authority of India's case would be confined only to private sector and contract workers in State or public sector undertaking will not be entitled to claim regularization even if the contract was sham and bogus and as such the order of reference ought to be set aside.
14. We are afraid that the contention is completely injudicious. In Umadevi's case the Court was concerned with public employment and Court's power under Articles 226/227 to grant relief of regularization. In Umadevi's case the Court was not concerned with the provisions of the Contract Labour (Regulation and Abolition) Act and the power of the industrial adjudicator to grant appropriate relief in a reference under the Industrial Disputes Act. The case does not even deal with the judgment in the Steel Authority of India's case. Both operate in different fields and the decision in Umadevi's case does not deal with the question of reference and forum where rights will have to be adjudicated. Umadevi's case is concerned with relief and the industrial adjudicator is required to examine the said question. The respondent workmen cannot be denied reference at this stage. As to what relief will be granted is uncertain and depends upon the number of facts. This position is also clear from at least three Supreme Court judgments, which are discussed hereinafter.
15. In Mineral Exploration Corporation Employees' Union v. Mineral Exploration Corporation Limited and Anr. : (2006)IIILLJ482SC , the workers engaged in the Corporation, who had completed minimum 8 years and maximum 20 years of service raised an industrial dispute for regularization of their services and revision of their pay scales. The Industrial Tribunal had directed regularization of services of the workmen and had held that the workmen were entitled to regular pay scales, increments, dearness allowance, etc. In a petition filed by the Corporation before the High Court, the award of the Labour Court was set aside. In appeal which was preferred by the workmen before the Supreme Court, the judgment of Umadevi's case was considered by a two Judge Bench and finally a direction was issued to the Tribunal to scrutinize all the records already placed by the appellant Union and also the records placed by the management and discuss and deliberate with all the parties and ultimately arrive at a conclusion in regard to the genuineness and authenticity of each and every claimant for regularization. Similarly in the case of Oil & Natural Gas Corporation Limited v. Engg. Mazdoor Sangh : AIR2007SC920 , the Supreme Court had confirmed the award of the Industrial Tribunal safeguarding rights of 153 workmen, who had admittedly completed 240 days in 12 consecutive months and some of them had worked for over 15 years, with a further direction that there shall be no further recruitment in the category concerned without the said 153 workers being absorbed against regular vacancies.
16. In Madhya Pradesh Administration v. Tribhuban (2007) 9 SCC 748 a Bench of two Judges of Supreme Court has examined judgment of Umadevi case and power of the Industrial Adjudication under the Industrial Disputes Act and it was observed as follows:
6. The question, however, which arises for consideration is as to whether in a situation of this nature, the learned Single Judge and consequently the Division Bench of the Delhi High Court should have directed reinstatement of the respondent with full back wages. Whereas at one point of time, such a relief used to be automatically granted, but keeping in view several other factors and in particular the doctrine of public employment and involvement of the public money, a change in the said trend is now found in the recent decisions of this Court. This Court in a large number of decisions in the matter of grant of relief of the kind distinguished between a daily wages who does not hold a post and a permanent employee. It may be that the definition of 'workman' as contained in Section 2(s) of the Act is wide and takes within its embrace all categories of workmen specified therein, but the same would not mean that even for the purpose of grant of relief in an industrial dispute referred for adjudication, application of constitutional scheme of equality adumbrated under Articles 14 and 16 of the Constitution of India, in the light of a decision of a Constitution Bench of this Court in Secy., State of Karnataka v. Umadevi and Ors. relevant factors pointed out by the Court in a catena of decisions shall not be taken into consideration.
17. It is thus clear that it is for the industrial adjudicator to decide whether the relief of regularization can be granted to the workmen and if not, what other relief can be granted to the workmen. It appears that workers were terminated on 20th March, 2003, after their prayer for reference was declined. The workers through their union had made a request for modification of reference so as to include the issue of termination. Accordingly, the first respondent is directed to modify the reference order and to include the claim of the workmen for reinstatement with full back wages. The said modification/amendment will be done within a period of four weeks from today. The Industrial Adjudicator shall thereafter proceed with the reference and dispose of the same as expeditiously as possible and in any event on/or before 31st October, 2009. The appeal is dismissed with no order as to costs.