Indian Bank Employees Union Vs. Union of India - Court Judgment

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 04.04.2014 CORAM THE HON'BLE Ms.JUSTICE K.B.K.VASUKI Writ Petition No.32994 of 2002 Indian Bank Employees Union rep.

by its Assistant Secretary, No.25, Second Line Beach, Chennai 600 001..Petitioner versus 1.Union of India rep.

by its Secretary Ministry of Labour, Sham Mantralaya, New Delhi 110 001.

2.The Presiding Officer, Central Government Industrial Tribunal cum Labour Court, Shastri Bhavan, Sterling Road, Chennai -6.

3.Indian Bank rep.

by its Chairman, and Managing Director, 31, Rajaji Salai, Chennai -1..Respondents Writ Petition is filed under Article 226 of the Constitution of India, for issuance of a writ of Certiorarified Mandamus, after calling for the records relating to the Award dated 2.8.2002 of the 2nd respondent in I.D.No.556 of 2001, quash the same as being illegal, arbitrary and unconstitutional and consequently direct the 2nd respondent to decide I.D.No.556/2001 on merits, after affording due opportunity of hearing to the petitioner.

(Prayer amended as per order dated 15.11.2002 in WP.MP.No.59854/2002) For Petitioner : Mr.Govardhanan for M/s.Row & Reddy For Respondents : Mr.Vijayan for M/s.King & Patridge (R3) ORDER

The writ petition is filed by Indian Bank Employees Union against the award made in I.D.No.556/2001 passed by the second respondent Industrial Tribunal cum Labour Court.

2.The dispute raised in I.D.No.556/2001 was whether the demand of Indian Bank Employees Union to regularise the service of Jewel Appraisers as permanent part time employees of Indian Bank is legally justified?.

If so, what relief the panel appraisers are entitled to?.

3.The dispute raised in I.D.No.556/2001 ended in an award dated 2.8.2002, thereby holding that the demand of the petitioner's Union against the Management of the Indian Bank on behalf of the Jewel Appraisers (Panel AppraiseRs.was not justified and concerned Appraisers were not entitled to any relief.

4.The writ petition was originally filed for the issuance of writ of Mandamus to the fiRs.respondent not to notify the award dated 2.8.2002 passed by the second respondent in I.D.No.556/2001 in the official Gazette and remit the industrial dispute for adjudication to the second respondent for disposal after giving due opportunity to the petitioner.

During the pendency of the writ petition, the award was notified and the relief was amended into one that of writ of Certiorarified mandamus, calling for the records relating to the Award dated 2.8.2002 made in I.D.No.556/2001 passed by the second respondent and to quash the same as illegal, arbitrary and unconstitutional and consequently direct the second respondent to decide the same on merits, after affording due opportunity of hearing to the petitioner.

5.Both the original and amended reliefs are sought for on the ground that the award was passed without giving due opportunity to the petitioner Union to effectively conduct their case by letting oral evidence and by duly advancing their case and the same was contrary to the procedure laid down under law and in violation of the principles of natural justice.

The reading of the affidavit filed in support of the writ petition would reveal that the grounds raised herein are against the manner of disposal of Industrial Dispute.

However, the learned counsel for the petitioner has advanced arguments on merits against validity and correctness of the award, as such, this court is inclined to deal with both the aspects.

6.Insofar as the manner in which ID was disposed of is concerned, the same was at one point of time, requested to be listed before the Lok Adalat.

The petitioner's Union filed a memo to refer the matter to Lok Adalat and the memo, after few adjournments, was closed for non-prosecution and default by reason of the petitioner's Union to appear and make representation, on 30.4.2002, on which date, ID stood adjourned to 30.5.2002 for enquiry and thereafter to 30.7.2002, on which date, the petitioner's Union was not ready and sought for adjournment and the same was seriously opposed by the Management and argument was also advanced on the Management side and ID stood adjourned to 31.7.2002 for the petitioner's side argument.

On 31.7.2002, the petitioner was permitted to mark Ex.W1 and both the parties were permitted to advance their arguments in detail and order was reserved.

Thereafter, order was pronounced on 2.8.2002, holding the petitioner's union not entitled to get any relief in the I.D.7.The petitioner has at page 110 of the typed set enclosed the Extract of 'A' Diary, which is the daily proceedings relating to I.D.No.556/2001.

The reading of the same reveals that the counter statement of the petitioner Union was filed on 15.5.2001 and enquiry was postponed between 1.6.2001 and 30.4.2002 and on 30.4.2002, memo was filed by the petitioner Union for referring the matter before Lok Adalat and memo was closed for non prosecution and default on the side of the petitioner Union.

After the memo was closed, the case stood adjourned for three months.

Even thereafter the petitioner Union was not ready to get along with the matter.

In the mean while, the petitioner Union was permitted to mark their document as Ex.W1 and to advance their argument on 31.7.2002.

It may be true that the Presiding Officer, Labour Court on 30.7.2002 refused to adjourn the matter and allowed the Management to advance their arguments and thereafter, adjourned the case to next day itself i.e., on 31.7.2002.

Such couRs.adopted by the second respondent Labour Court is according to the learned counsel for the petitioner union is not in accordance with the procedure laid down and is in violation of the principles of natural justice.

But in my considered view, in the instant case that by itself will not render the entire proceedings vitiated for the simple reason that the petitioner Union was given opportunity to let in evidence.

Neither the extract of 'A' diary nor the averments raised in the affidavit filed in support of the writ petition would disclose that the request of the petitioner Union to let in evidence on 31.7.2002 was rejected and the enquiry was proceeded further.

On the other hand, the extract of 'A' diary would only show that the petitioner Union did not appear to have sought for any opportunity to let in evidence on 31.7.2002, on which date the case stood adjourned.

Whereas, the petitioner Union marked Ex.W1 as documentary evidence on their side and advanced oral argument on the same day.

The petitioner Union did not appear to have made representation to the second respondent Labour Court either orally or in writing to permit the same let in oral evidence and to adjourn the case for such purpose.

The daily proceedings as entered in 'A' diary would not reveal one such request made by the petitioner union.

When the petitioner Union did not think fit to make one such representation, the question of requiring the Labour court to call upon the petitioner's Union to let in oral evidence does not arise herein.

The document was marked and argument was advanced on both sides and the order was reserved on 31.7.2002 and the award was pronounced on 2.8.2002 and the same was published in court notice board.

Thus, the petitioner Union who failed to avail the opportunity both on 30.7.2002 and on 31.7.2002, which compelled the Court to proceed with the matter in the manner known to law and ID was thereafter disposed of on merits.

When that being the factual state of affaiRs.it cannot be said that the petitioner was deprived of due opportunity of being heard and the impugned order suffers from either violation of the procedure laid down under law or the principles of natural justice.

8.On facts, the point that arises for consideration herein is whether the Jewel Appraisers (Panel AppraiseRs.shall be treated as part time employees of the Indian Bank to avail the service benefits of the employees of the Indian Bank.

9.The facts made available herein would reveal that one of the main activities of the Bank is to grant advances against gold ornaments.

The respondent Bank for the limited purpose of appraising weight, quality, purity and market value of the jewels, which has been offered as security, required professional opinion of the Gold Smiths and in order to avail their professional opinion, the bank has been engaging Jewel AppraiseRs.The respondent Bank has been originally treating them as contractors on contract basis which compelled earlier set of employees to raise industrial dispute in I.D.No.25/1977 and the two issues arose in the same are as follows: (i)Whether the action of the Management of the Indian Bank, Madras in changing the conditions of service of appraisers so as to eliminate the minimum guaranteed wage of 50 paise per loan and Rs.150/- per month is justified?.

If not, to what relief are the workmen entitled?.

(ii)Whether the action of the management of the Indian Bank, Madras in denying to appraiseRs.wages and other conditions of service applicable to regular clerical ".Award Staff".

of the Bank is justified?.

If not, to what relief are the workmen concerned entitled?.

The Tribunal has, on the basis of the facts involved therein and the records made available therein, arrived at the conclusion that the Jewel Appraisers were not independent contractors or self styled professionals, but were part time employees or part time workmen of the respondent Management Bank and there was absolutely no basis for the management to deny wages and other conditions of service applicable to regular clerical ".Award Staff".

of the Bank to appraisers employed by them and accordingly decided the ID in favour of the workmen Association by holding that the appraisers employed by the respondent Management Bank were entitled to wages and other conditions of service applicable to regular clerical ".Award Staff".

as part time employees of the Bank and they would be entitled to such proportionate (namely half) of wages and benefits of clerical staff with effect from 1.4.1977 which is the date on which reference is made by the Government of India.

10.The following are the factors which influenced the labour Court to decide the industrial dispute in ID.No.25 of 1977 in favour of the appraisers (i)the appraiser should, as per the terms and conditions of their appointment, execute an indemnity bond with one surety in favour of the Bank in the prescribed draft on Rs.2.50 non judicial stamp paper; (ii) He should furnish a cash security of Rs.500/- or property of the value of not less than Rs.1000/-.

(iii)the appointment of the appraiser is purely on temporary basis for a period of one year and the Bank will have the option to terminate the appointment without any notice period and without assigning any reason.

(iv)the appraiser will not be entitled to any benefits such as leave, provident fund, gratuity, bonus etc.(v)his remuneration will be in the form of appraising commission determined on the following basis: 0.10 paise per Rs.100/- of the loan allowed with a minimum of 50 paise per loan subject to minimum monthly commission of Rs.125/.

(vi)He should be present at the Bank premises on all working days during banking houRs.The office hours of a clerical cadre staff is 6 = houRs.whereas, the appraisers are expected to work more than half of the working hours of clerical staff of the respondent management Bank and that the place of work of the appraiser is also in the premises of the Bank.

(vii)Jewels should be appraised only in the Bank's premises and in the presence of the Agent and that on no account they should be sent outside the Bank premises for appraisal and the appraisers cannot do private business within the business hours and bank premises; (viii)the appraisers bring artisan tools such as touch stones, boxes and other instruments and materials for the purpose of appraisement of the jewels and instruments like weighing machines and weights are supplied by the Bank.

(ix)The Bank has treated the appraisers as its own employees and therefore is anxious to maintain cordial relationship between its employees-appraisers and gold loan borrowers of public at large.

(x)his remuneration is ordered to be deducted proportionately for his absence.

(xi)the management has effective control and discipline over its employees/appraiseRs.(xii)if the appraiser wants leave for a particular day, he will have to apply for it in advance and if he does not apply in advance and is absent his payment will be cut off.

If the appraiser does not come on a particular day, no part of his wages will be cut if prior permission had been accorded from the Manager.

(xiii)The revised guidelines for selecting candidates as appraisers for the Bank are such that it would reveal they are not independent contractORS.(xiv)certain amounts collected by way of appraisers fee will be credited to the account of ".Appraisers Fee Collected Account".

and debited to the expenditure account of ".Appraisers Fee Account".

and each appraiser was paid a minimum of Rs.150/- per month whether in fact, the total fee was below Rs.150/- per month.

Thus, the payment of minimum of Rs.150/- per month to each appraiser would go to probabilise the claim of the employees that they are the part of the employees under the Respondent-Management Bank and also dispel the theory that the appriaser is an independent contractor.

(xv)In addition to that, though the appraiser independently and utilising his professional skill values the jewel, the management is not bound by such valuation and the decision of the Manager alone is final with regard to quality and quantity of the jewel, which shows that there is no basis to hold that the appraisers are contractors or independent contractors under the respondent management and (xvi)the work done by the appraiser forms integral part of the respondent Bank.

The appraisers are infact doing other jobs like filling up the entries in Loan Ledger, Advance RegisteRs.Token RegisteRs.Interest Card, Due date Register, Debit and Credit VoucheRs.Identity Card, Jewel Bag Card and Auction notice etc.The award passed in I.D.NO.25/1977 was challenged before this Court as well as before the Hon'ble Supreme Court, wherein also, the same was confirmed.

11.The petitioner Union herein both before the Tribunal as well as this court in this writ petition has claimed the same status and service benefits applicable to the clerical staff as decided in I.D.No.25/1977 mainly on the ground that the grant of jewel loan is one of the significant activities of the Bank and the appraiseRs.who are engaged for ascertaining the genuineness and valuing the jewel for the purpose of grant of loan, are fundamentally required for such transaction and they have to work in the premises of the Bank and also do other clerical works and their nature of services are no difference from that of the workmen, whose dispute was earlier adjudicated before the Tribunal as such, their services are to be regularised as that of permanent employees on the basis of the earlier award made in ID.No.25/1977 and panel appraisers cannot be denied the benefit of that award.

12.Such claim is seriously resisted by the respondent Bank by saying that the respondent Bank thought it fit and advisable to have panel of goldsmiths just like Engineers and Advocates and these goldsmiths in the panel render independent professional opinion on the jewels proposed to be pledged by the customer in the respondent Bank and like that of the borrowers paying fees/professional charges directly to the Advocates, Engineers for giving opinion on title deeds and valuation certificates as the case may be and the jewel loans are also paying fees/professional charges directly to the empanelled goldsmiths, who appraises the jewels and gives professional opinion on the jewels and these goldsmiths are not doing any other clerical work and their professional services are utilised by the Bank and there is no fixed time for rendering their services.

It is further contended by them that unlike the earlier panel of jewel appraiseRs.who were employed on contractual basis and who were doing allied and incidental clerical works as well and were required to be in the branch during specified period, the goldsmiths, who are presently in the panel, are not doing any clerical work and the respondent Bank does not have any control over them and for the services rendered by the goldsmiths and the fees are not paid by the respondent Bank, as the intending borrowers are required to pay the commission to the panel appraisers and they do stand in a different footing and they cannot be equated with the present system of panel appraiseRs.For the purpose of comparison between the two, the respondent Bank has in their counter filed before the Tribunal, differentiated the service conditions of goldsmiths engaged on contract basis and goldsmiths on panel by way of tabular column, which is for better appreciation reproduced hereunder: Goldsmiths engaged on contract basis Goldsmiths on panel Apart from appraising jewels they were doing other clerical works, incidental to or connected with the sanction of jewel loans disbursement and follow-up of loan.

They are required to give only professional opinion on the security offered for pledge.

The services were utilised by the respondent Bank for appraising and incidental clerical work The goldsmiths on panel are utilised by the intending customers for limited purpose of appraising their jewels.

The respondent Bank does not utilise their services for any other work They were working as per the contract/agreement.

No contract deed/agreement needs to be signed by panel appraiseRs.Security/caution deposit has to be paid by appraisers to the Bank No security/caution deposit is payable by them.

Service charges were paid through the respondent Bank minimum commission was paid by the Bank Appraiser fees are paid by the intending borroweRs.The goldsmiths are working under a contract with the Bank.

The goldsmiths are not coming under any contract of employment with the Bank They were working under administration control of the Bank.

The goldsmiths are not amenable to administrative or disciplinary control of the respondent Bank Each branch had only one appraiser on contract basis.

Each branch have more than one goldsmiths in panel of the branch Generally, an appraiser was attached to a particular branch i.e., contract was with a particular branch.

A branch may have more than one appraiser and their services may be utilised by the branch.

They are required to work in a fixed time and controlled by the branch.

The goldsmiths in the panel are not required to work in a fixed time and are not controlled by the branch.

They are independent in offering their services.

13.The difference in service conditions of both set of appraisers as stated above is not factually denied on the side of the petitioner Union.

In that event, the learned counsel for the respondent Bank has cited the authority of the Hon'ble Supreme Court reported in (2006) 3 SCC729(Indian Overseas Bank v.

Workmen).wherein, similar award passed in favour of the Jewel Appraisers was challenged.

The issue arose for consideration therein was whether the demand of the All India Indian Overseas Bank Employees' Union to treat the jewel appraisers engaged by the Bank as part time workmen of the Bank is justified?.

If so, to what relief, if any, are they entitled?.The claim made by the workmen Union was identical to that of the claim made herein and the same was also opposed on the same ground as stated in the present case by the respondent Bank.

The Hon'ble Apex Court, after having referred to the award passed in I.D.No.25/1977 which is also cited herein, in para 13 of the judgment, made reference to the circulars dated 23.8.1975 and 2.1.1987 and noted that the dispute in Indian Bank case was conceptually different.

Further, the Hon'ble Supreme Court in paras 14 and 15 observed as follows: ".14.A few distinguishing facts need to be noted.

In Indian Bank case there was evidence to show that the jewel appraisers work regularly for four houRs.It was clearly admitted in the instant case by the witnesses of jewel appraisers that there was no fixed period of work and they could come and go at any point of time.

In Indian Bank case, the Bank had disciplinary control on the jewel appraiseRs.In the instant case, it was admitted by the witnesses that the Bank did not exercise any disciplinary control.

In Indian Bank case conditions were to be fulfilled before any leave was granted.

In the present case, the jewel appraisers were not required to sign attendance register and also were not required to make any leave application.

The most relevant factor in Indian Bank case was that the jewel appraisers were paid a minimum amount per month which was somewhat akin to salary.

In the instant case, the amount was paid on commission basis by the loanee and not by the Bank.

15.A few other facts need to be noted.

In the present case as well as in Puri Coop.

Bank case the jewel appraisers were required to weigh the ornaments brought to the Bank for pledge and to appraise the quality, purity and value.

The jewel appraisers could be asked to do this exercise but not the manner in which it was to be done.

In both the cases the respective Banks had their lists of appraiseRs.It was not obligatory for the Bank to allot work to any particular jewel appraiser.".

Thereafter, the Hon'ble Apex Court in para 17 summed up the inference culled out from the reading of the judgments referred to therein, which reads as follows: ".(a)where the contractors were substantially responsible for the main and sole business, they would be treated as workeRs.(b)one exception is that where in such cases flexibility of the contract was at variance with the normal worker's contract, the contractors would not be treated as workeRs.(c)where the contractor is in the nature of supplier of goods and services, they are to be treated as supplier contractors and not workmen.".

14.The Hon'ble Apex Court in para 18 made distinction between jewel appraisers and the regular employees of the Bank by way of tabular column, which is extracted hereunder: Regular employees Jewel appraisers 1.

Subject to qualification and age prescribed.

2.Recruitment through employment exchange/Banking service Recruitment Board.

3.Fixed working houRs.4.Monthly wages.

5.Subject to disciplinary control.

6.Control/supervision is exercised not only with regard to the allocation of work, but also the way in which the work is to be carried out.

7.Wages are paid by the Bank.

8.Retirment age.

9.Subject to transfer.

10.While in employment cannot carry on any other occupation.

1.No qualification/age.

2.Direct engagement by the local Manager.

3.No fixed working houRs.4.No guaranteed payment, only commission paid.

5.No disciplinary control.

6.No control/supervision over the nature of work to be performed.

7.Charges are paid by the borroweRs.8.No retirement age.

9.No transfer.

10.No bar to carry on any avocation or occupation.

Ultimately, the Hon'ble Supreme Court held that the jewel appraisers are not employees of the Bank and accordingly, set aside the judgment of the Division Bench affirming the views of the learned single judge and Tribunal, as clearly indefensible and allowed the appeal filed by the Indian Overseas Bank.

15.As rightly argued by the learned counsel for the respondent, the service conditions of the panel appraisers of the Indian Bank is identical as that of the Indian Overseas Bank.

The distinction between the jewel appraisers and regular employees of the Indian Bank is also identical as noted by the Hon'ble Apex Court in the case of Indian Overseas Bank, as such, the decision of the Hon'ble Apex Court in Indian Overseas Bank case is squarely applicable to the facts of the present case.

16.In my considered view, the Tribunal has rightly brought out the distinction between the Jewel Appraisers (panel appraiseRs.and regular employees and that of the Jewel Appraisers were engaged on contract basis and arrived at the conclusion that the present set of employees are not the regular employees of the respondent Bank.

If the findings rendered by the Tribunal are viewed in the light of the available materials as discussed above and also by applying the views of the Hon'ble Apex Court as stated supra, the same is held to be K.B.K.VASUKI, J.

rk based on proper appreciation of relevant factors and by supporting materials and reasonings.

The petitioner has not made out any ground much less valid ground, warranting interference by this Court in the award so passed.

17.In the result, the writ petition is dismissed.

No costs.

Index:Yes/No Internet:Yes/No rk 04.04.2014 To 1.Union of India rep.

by its Secretary Ministry of Labour, Sham Mantralaya, New Delhi 110 001.

2.The Presiding Officer, Central Government Industrial Tribunal cum Labour Court, Shastri Bhavan, Sterling Road, Chennai -6.

Writ Petition No.32994 of 2002