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1980 DIGILAW 200 (PAT)

Bihar State Leather Industries Development Corporation Ltd. v. Chiraguddin Ahmad

1980-10-01

B.S.SINHA, L.M.SHARMA

body1980
Judgment BRISHKETU SARAN SINHA, J. The prayer in this application is to quash annexure 2 and 3, appended to it. Annexure 2 is An order dated 12th December, 1975. passed in B.S. Case No.9 of 1975. A.B. Prasad, Presiding Officer, Labour Court, Muzaffarpur holding that the case was maintainable and the Labour Court had jurisdiction to entertain it Annexure 3 is the final order dated 28th February, 1977, allowing the claim of the complainant-respondent no.1 Chiraguddin Ahmad and directing the petitioners to reinstate the complainant with continuity and with back wages. 2. Petitioner No.1, the Bihar State Leather Industries Development Corporation Limited (hereinafter referred to as the Corporation) is registered under the Indian Companies Act. 1956 and is a Government of Bihar Undertaking, and petitioner no.2 is its Managing Director, Respondent no.1 was initially, appointed on 24th July, 1961, as a Foreman in the Footwear, Factory of the Bihar State Small Industries Corporation Ltd. at Darbhanga, which was subsequently taken over by petitioner no.1 and hence the service of respondent no.1 were transferred to petitioner no.1. He was subsequently appointed as Manager of the Leather Goods Factory, Bettiah on 30th July, 1970. According to the petitioner, respondent no.1 was the Manager of the Leather Goods Factory (hereinafter referred to as the Leather Factory) and was in the immediate charge of its general management and control. He was also the disbursing officer and used to disburse salary to persons who were employed there by the Corporation. 3. On 13th May, 1914, respondent no.1 left Bettiah without sanction of leave or permission to leave station; but left an application for casual leave from 13th May, 1974 to 18th May, 1974. This resulted in serious dislocation on the Leather Factory as he had not handed over charge to anybody also. As he did not turn up for duty on 19th May, 1974 telegram was sent to him which was followed by a Letter dated 6th June, 1974, requesting him to go to Bettiah and hand over charge of the accounts and other important papers of the factory by 10th June, 1974. Inspite of such telegram and communication, respondent no.1 did not company with the directions and informed petitioner no. 2 that he was unable to leave Ranchi. Inspite of such telegram and communication, respondent no.1 did not company with the directions and informed petitioner no. 2 that he was unable to leave Ranchi. He was again asked to hand over charge within a certain time which be did not comply with As respondent no, 1 did not turn up either to join his duties or to hand over charge, the petitioners allege that they bad no alternative but to issue memo no. 1376/74 dated 21st September. 1974 calling upon respondent no.1 to explain why disciplinary action should not be taken against him. On 1st October, 1974, petitioner no. 2 appointed the Chief Accounts Officer-cum-Assistant Secretary of the Corporation as the Enquiring Officer to enquire into the charges. Respondent no. 1 was also put under suspension with effect from 16th December, 1974. Respondent no.1 appeared before the Enquiring Officer on 21st April, 1975, when it was enquired as to whether he wanted to adduce any evidence in his defence or give anything in writing in support of his defene which he answered in the negative. He further stated that he bad already explained the charges levelled against him in his letters dated 1st October, 1974 and 16th January, 1976, and had nothing further to add to them. This submission made by him was reduced into writing and each page was signed by him and a copy of it was also furnished to him. The Enquiring Officer submitted his report stating that respondent no. 1 had not satisfactorily explained as to why he was not able to hand over charge to the person directed by the head also rejected the explanation submitted by respondent no. 1 with regard to non-furnishing of medical certificate in time and hence he concluded that the charges against respondent no.1 had been proved. Thereafter, on 29th May, 1975 another notice was served to respondent no.1 and he was directed to show cause within charged. The show cause was filed on 9th June. 1975 and received on 12th June, 1975 in the office of the Corporation of all the materials, petitioner no.2 came to the conclusion that respondent no.1 was guilty of gross misconduct and, as such, he was discharged from service of the Corporation as per order dated 16th August, 1975, copy of which is annexure 1. 4. 1975 and received on 12th June, 1975 in the office of the Corporation of all the materials, petitioner no.2 came to the conclusion that respondent no.1 was guilty of gross misconduct and, as such, he was discharged from service of the Corporation as per order dated 16th August, 1975, copy of which is annexure 1. 4. Respondent no.1, thereafter, filed a complaint under section 26(2) of the Bihar Shops and Establishments Act, 1953 (hereinafter referred to as the Act) before the Presiding Officer. Labour Court, Muzaffarpur, respondent no.2 giving rise to case no.9 of 1975. In that case the enquiry officer had not provided sufficient opportunity to respondent no.1 and also that the enquiring officer had not provided sufficient opportunity to respondent no.1 to furnish evidence and defend himself, and, as such the whole enquiry was vitiated, being violative of the principal of natural justice. The presiding Officer took cognizance of the complaint and issued notice to the petitioners who appeared and submitted their reply. The further stand taken by the petitioners was that the provisions of the Act, were not applicable to the Corporation, its employees or other personal and that in any view respondent no.1 was not an employee within the meaning or section 2(4) of the Act, and, as such, a complaint made by him could not be entertained by the Labour Court under the Act. It was specifically pleaded that respondent no. 1 was the Manager of the Leather Factory of the Corporation and was an employer or the Leather Factory within the meaning of section 2 (5) of the Act. 5. The maintainability of the complaint petition and the jurisdiction of the Labour Court was beard as a preliminary issue and by the order dated 12th December, 1975, copy of which is annexue 2 the Labour Court was heard as the respondent no. 1 was an employee within the meaning of the Act. Thereafter, the complaint petition was heard in which the petitioners placed on record all relevant letters and documents and also examined the enquiring officer as well as one Ram Pravesh Kr. to prove the charge levelled against respondent no. 1 and to justify the order of discharge. Respondent no.1 examined the witnesses including himself in support of his complaint. Thereafter, the complaint petition was heard in which the petitioners placed on record all relevant letters and documents and also examined the enquiring officer as well as one Ram Pravesh Kr. to prove the charge levelled against respondent no. 1 and to justify the order of discharge. Respondent no.1 examined the witnesses including himself in support of his complaint. By the second impugned order, copy of which is annexure 3, the Labour Court held that the charge of disobedience and negligence of duty against respondent no.1 bad not been substantiated and he was not guilty of any misconduct or wilful absence or disobedience of orders and negligence of duties. He also held that the case was not barred by limitation. On these findings the directions as stated above were given. 6. In support of tills a application it has been submitted that respondent no.1 being a Manager, was not entitled to take recourse to the provisions of sections 26 of the Act. It was further urged that the Leather Factory is a factor, within the meaning of the Factories Act, and Respondent no. 1 had described himself as the occupier of the Factory. He was an. employer within the meaning of section 2 (5) of the Act. It was next submitted that in any view, the provisions of the Act, could not apply to the case of respondent no. 1 as it would be covered by item 5 of the schedule under section 4(2) of the Act. Lastly it was submission that the Labour Court erred in holding that these has been violation of the principles of natural justice as respondent no.1 had not been given sufficient and ample opportunity to lead his defence. 7. A counter affidavit has been filed on behalf of respondent no.1 and a reply to the counter affidavit has also been filed on behalf of the petitioners. 8. I proceed to consider the first submission made on behalf of the petitioners. Mr. U.P. Singh, learned counsel for the petitioner, has urged that respondent no. 1 was not an employee within the meaning, of section 2 (4) of the Act. 8. I proceed to consider the first submission made on behalf of the petitioners. Mr. U.P. Singh, learned counsel for the petitioner, has urged that respondent no. 1 was not an employee within the meaning, of section 2 (4) of the Act. He further submitted that respondent no.1, being the Manager or a person in the immediate charge of the general management or control of the leather factory was an employer of the establishment and hence be could not avail of the provisions of section 26 of the Act, It is said that respondent no. 1, as the Manager of the leather factory was in the immediate charge of the general management and control of the factory at Bettiah and was also disbursing officer of the factory who used to disburse salary etc. It is further pointed out that in his counter affidavit respondent no, 1 himself admits that be was occupying the post of Manager of leather factory at Bettiah where he had come on transfer from Darbhanga. Further, annexure 4 appended to the reply to the counter affidavit would show that respondent no.1 in submitting the application for registration and grant or renewal of licence for the leather factory described himself as the occupier of the factory. An averment has been made in this reply to the counter affidavit that the leather factory is an independent establishment within the meaning of the Act, in which respondent no.1 was in the immediate charge of the general management and control. 9. Sub-sections (4), (5) and (6) section 2 of the Act, read thus : "(4). "Employee" means a person wholly or partially employed for hire-wages including salary, reward, or commission in, and in connection why any establishment and includes "apprentice" but does not include memo her of the employer's family. 9. Sub-sections (4), (5) and (6) section 2 of the Act, read thus : "(4). "Employee" means a person wholly or partially employed for hire-wages including salary, reward, or commission in, and in connection why any establishment and includes "apprentice" but does not include memo her of the employer's family. It also Includes personal employed in doctor, who are not workers within the meaning of the Factories Act, 1948 (63 of 1948), and for the purpose of proceeding under this Act, include an employee, who has been dismissed, or retrenched for any reason whatsoever: (5) "Employer" means a person who own or exercises ultimate control over the affairs of as establishment and includes a manger, agent or any person in the immediate charge of the general management or control of such establishment, (6) "Establishment" means an establishment which carries on any business, trade or profession or any work in connection with, or, incidental or ancillary to, any business, trade or profession and includes : (i) administrative or electrical service appertaining to such establishment, (ii) a shop, restaurant, residential hotel, eating house, theatre or any place of public amusement or entertainment, and (iii) such other establishment as the State Government may, by notification, declare to be an establishment to which the Act, applies : but does not include a motor transport undertaking, as defined in clause (g) of section 2 of the Motor Transport Workers Act. 1961 (27 of 1961). Learned counsel for the parties agree that the leather factory is an establishment within the meaning of the Act. The controversy is whether respondent no. 1 is an employee ill terms of the provisions in the Act. Learned counsel for the parties have not cited any direct authority of the point. 10. From the defining section, quoted above, it will be seen that a wide meaning has been given to the word "employee". A person wholly or partially employed for hire-wages including salary, reward or commission “in connection with any establishment" mean an employee. The expression also includes apprentice as also persons employed in a factory who are not workers within the meaning of the Factories Act, 1948 and of the purposes of this Act, would include a person who has been dismissed, discharged or retrenched for any reason whatsoever. The only class of people included are members of the employers family. The expression also includes apprentice as also persons employed in a factory who are not workers within the meaning of the Factories Act, 1948 and of the purposes of this Act, would include a person who has been dismissed, discharged or retrenched for any reason whatsoever. The only class of people included are members of the employers family. Before an amendment brought about in the Act, in 1975 it also includes persons "working in managerial capacity." But even that expression has now been included. Admittedly, respondent no. 1 has been working in the leather factory at Beulah and for this he was getting a salary. It is obvious therefore, that respondent no. 1 was an employee of the leather factory. 11. Under section 26 (2) of the Act, every employee dismissed or discharged, or whose employment is otherwise terminated, may make a complaint in writing in a prescribed manner to the prescribed authority against such dismissal, discharge or termination and under section 26 (1) there is an obligation on the employer not to dismiss, discharge or otherwise terminate the employment of any employee who has been in his employment continuously for a period of not less than continuously for a period of not less than six months except for a reasonable cause and after giving such employee at east one month’s notice or one month’s wages in lies of such notice. There are two provisos added to it which need not be dealt with here. Responding these two provisions it is again manifest that against dismissal, discharge or termination of employment, the employee has a cause of action against his discharge from service. The question, therefore, that needs to be considered is whether petitioner no.1 is an employer of respondent no.1 is an employer of respondent no.1 within the terms of the Act. I have already quoted above the definition of an employer as well, which says that an employer is a person who owns or exercises ultimate control over the affairs of not establishment and includes a manager, agent or any other person in the immediate charge of the general management or control of such establishment. It will be seen that while an employees has to be “wholly or partially employed” in connection with any establishment, and employer is one “who owns or exercise ultimate control over the affairs of an establishment”. It will be seen that while an employees has to be “wholly or partially employed” in connection with any establishment, and employer is one “who owns or exercise ultimate control over the affairs of an establishment”. In the instant case respondent no.1 who was working as a Foreman in footwear factory at darbhanga was transferred to the leather factory at Bettiah by petitioner no.1 and even the order of termination of service, copy of which is Annexure-I states that respondent no.1 and his services were, therefore, being discharged. These go to show that petitioner no.1 exercised ultimate control over the affairs of the leather factory. Therefore, I have no hesitation in holding that petitioner no.1 was the employer of respondent no.1. 12. It was urged on behalf of the petitioners that as respondent no.1 was the Manager of the leather factory and in immediate charge of its general management or control. He was an employer, within the meaning of the Act, of the leather factory and, therefore, he could not be an employee at the same time as well. It is quite possible that if some workers of the leather factory bad a cause of action under section 26 of the Act, respondent no. 1 would, for such an action, be an employer within the meaning of the Act, and indeed it was pointed out in the case Calcutta Chemical Company Limited and others V. D.K. Burman and another the Manager of the Patna Branch could also be an employer within the meaning engrafted in section 2 (5) of the Act. This observation was made where an employee had filed an application under section 26 of the Act, against the Calcutta Chemical Company Limited in which it was argued that the Manager of the Patna Branch office was an employer within the meaning of the Act. 13. I will now consider some of the decisions cited by learned counsel for the parties. It would be convenient first to refer to the case of T. Devandason V. Gordon Woodroofe & Co. (Madras) Private Ltd. & others. 13. I will now consider some of the decisions cited by learned counsel for the parties. It would be convenient first to refer to the case of T. Devandason V. Gordon Woodroofe & Co. (Madras) Private Ltd. & others. In that case the provisions of the Madras Shops and Establishment Act, 1947, fell for consideration where it was provided that a person employed in a commercial establishment meant a person wholly or principally employed in connection with the business of the establishment and in that context it was observed that it had to be determined by whom the person was employed. It will be see a that there ii a difference between the definition of employee between the Act, and the Madras Act. Under the Madras Act, which had fallen for consideration by the Supreme Court an employee is a person wholly or principally employed while under the Act, he is a person wholly or partially employed. 14. Reliance was also placed on certain observation in paragraph 18 of the judgment in the case of T. Prem Sagar V. M/s Standard Vacuum Oil Company, Madras & others which lay down the tests which Sagar V. M/s Standard Vacum Oil company, Madras & others which lay down the tests which and to be applied to determine whether a person employed in an establishment in a position of management. It has not been suggested that those were fulfilled by respondent no.1 with regard to petitioner no.1 the establishment, in which he was at least partially employed. The case of the Chairman, M/s Brooke Bond India Private Ltd. and another V. Chandranath Choudhary is not relevant in the questions the jurisdiction of the Labour Court under section 26 of the Act, was limited to cases of misconduct as set out in rule 20 and cases falling under section 33 A of the Industrial Disputes Act. The case of the Chairman, M/s Brooke Bond India Private Ltd. and another V. Chandranath Choudhary is not relevant in the questions the jurisdiction of the Labour Court under section 26 of the Act, was limited to cases of misconduct as set out in rule 20 and cases falling under section 33 A of the Industrial Disputes Act. The case of Chandra (T.P.) V. Commissioner for Workmen’s Compensation Madras and another is also of no assistance in that case, construing the provisions of the shops and establishment Act, it was held, on the fact of that case, that a person employed in the branch establishment Act, it was held, on the facts of that case, that a person employed in the branch establishment was not in a in the branch establishment was not in a position of management under the Madras Act, Similarly, in the case of jeyams Engineering Company, Coimbatore V. Additional Commissioner for workmen Compensation and another’s a Bench of the Madras High Court held that when a person employed as a Branch Manager of an establishment having been transferred to another branch, and the transfer being not by way of punishment, was dismissed from service for not obeying the order of transfer, the employee concerned did not cease to continue in the position of management at the time of his dismissal within the meaning of the Act. 15. Coming to the second submission, It has been urged on behalf of the petitioners, that the complaint of respondent no.1 was not maintainable in view of item 5 of the schedule read with section 4 (2) of the Act. Section 4 (2) states that the provisions of the Act, as specified in the third column of the schedule will not apply to the establishments, employees and other referred to in the corresponding entry in the second column of the schedule. It is not necessary to refer to the provision. Item 5 of the schedule reads thus: Serial No. Establishments, Provisions of the Act. employees or other persons 1 2 3 5. Person occupying positions of managerial or supervisory character in an establishment employing more than five persons, provided that not more than ten per centum or the total number of employees in an establishment shall be so exempted. Item 5 of the schedule reads thus: Serial No. Establishments, Provisions of the Act. employees or other persons 1 2 3 5. Person occupying positions of managerial or supervisory character in an establishment employing more than five persons, provided that not more than ten per centum or the total number of employees in an establishment shall be so exempted. Provided that where ten per centum of the total number of employees in an establishment comes to a fraction less than one such fraction shall be rounded off to one. It would be pertinent to state here that the entry "All Provisions" in the third column has been made by a notification issued by the Government on 27th March, 1976. It is obvious, therefore, that none of the provisions of the Act, would apply to personal mentioned in column 2 of item 5 after 27th March, 1976. In the instant case the complaint was filed sometime in 1975. At that point of time the relevant entry in column 3 against items read as follows; “All provisions except sections 7, 8, 12 (1) and 26 and Chapters VI and VII.” It is manifest, therefore, that in 1975 the provisions of section 26 applied to persons as mentioned in column 2 of item 5 of the schedule. All section 26 deals with substantive rights and not only procedural rights, the exclusion of section 26 from 27th March, 1976, is of no avail in the present case. In that view this submission has got to be rejected. 16. Lastly, it was submitted on behalf of the petitioners that the labour Court erred in holding that there has been violation of the principles of natural justice. It is settled law that under its writ jurisdiction for the issuance of a writ of certiorari this court does not sit in appeal over the decision of the Labour Court. An order of the labour Court can be questioned it is shown that there has been an error of law on the face of the record or that the conclusions arrived at are on extraneous considerations or are perverse. An order of the labour Court can be questioned it is shown that there has been an error of law on the face of the record or that the conclusions arrived at are on extraneous considerations or are perverse. We have been taken through the order of the Labour Court, copy of which is annexure 2, and I find that the court below came to the conclusion that the charge of being disobedient and negligent in discharge of this duty bad not been substantiated and that the evidence disclosed that respondent no.1 had to leave Bettiah suddenly in anticipation of the sanction of leave and thereafter he was not in a position to join because of his own illness also till 16th March, 1975, It has further been held that the evidence does not indicate that the respondent no. 1 had wilfully absented and that the ground of illness was not genuine and that he bad from time to time applied to, extension of leave which was never refused. It cannot be said that on the evidenced, these findings were either on extraneous consideration or perverse. No error of law apparent on the face of the record also has, been pointed out. It may also be pointed out that the Labour Court has come to the conclusion that respondent no. 1 was not given opportunity to adduce further evidence before the domestic tribunal which was violative of the principles of natural justice. This submission therefore, on behalf of the petitioners, also cannot be sustained. 17. In the result, there being no merit in this application, it is, dismissed but without costs. I agree. Application dismissed.