FAKIR LOHAR v. FOOD CORPORATION OF INDIA — 1993 DIGILAW 402 (CAL)

RUMA PAL, J. ( 1 ) THE petitioners claim to be working as piece rated contract/handling labour and casual labour at the Food Storage Depot, Balarampur, Purulia of the Food Corporation of India (referred to as FCI ). The petitioners have claimed regularisation and absorption under the Food Corporation of India. They have also claimed the benefits of the direct payment system introduced by the FCI in connection with certain of the FCI's Godowns. ( 2 ) THE first claim of the petitioner is under the Contract Labour (Regulation and Abolition) Act, 1970 (referred to as the Act ). The petitioners say that they have been working as casual labour under the FCI for the last 16 years. It is said that the need : of the FCI which was fulfilled by the petitioners was perennial in nature and was necessary for the work of the FCI. It is claimed that the Appropriate Government should have, in the circumstances, issued a notification under Section 10 of Act: prohibiting the employment of contract labour in FCI's establishment. It is submitted that this court should direct the issuance of such a notification and until the Appropriate Government issued such a notification, the status-quo should be continued with regard to the petitioners employment under the FCI. The petitioners have relied upon the several decisions in this context which will be considered later in this judgment. ( 3 ) IT is also submitted by the petitioners that they had been employed as casual labour with the FCI since 1976 under different contractors and that they had a right to be absorbed as permanent employees of FCI. The FCI had issued tender notice on May 18, 1993 seeking to appoint a handling-cum-transport contractor in respect of the Food Supply Depot at Balarampur. It is stated that by seeking to appoint a new contractor the petitioner's legitimate expectation for continuance in their employment would be taken away. It is said that the petitioners had made a representation in February 1993 to the respondent authorities asking for absorption with FCI and for implementation of the direct payment system until such absorption. According to the petitioners, the respondent authorities inspite of the receipt of the representation did not reply to the same. It is said that the petitioners had made a representation in February 1993 to the respondent authorities asking for absorption with FCI and for implementation of the direct payment system until such absorption. According to the petitioners, the respondent authorities inspite of the receipt of the representation did not reply to the same. ( 4 ) THE second grievance of the petitioners relates to the direct payment system which, according to the petitioners, had been introduced by the FCI in respect of the Godowns of FCI at Durgapur and Gopalpur within the District of Burdwan and Abdarpur within the District of Birbhum. The petitioners have relied upon a circular dated October 1, 1986 in this context. Under the circular the labourers at the named godowns were given various facilities including gratuity and a minimum guarantee money of Rs. 600/-per month per worker. It is said that the only reason for not extending the same benefit to the petitioners was the size of the godown at which the petitioners were employed. This, according to the petitioners was not a reasonable criterion to deny the benefit to the petitioners. ( 5 ) THE respondents on the other hand have contended that the writ application was not maintainable as disputed question of fact were involved. It is submitted that the object of the Act was not to abolish contract labour but to regulate it. It is submitted that the FCI had taken every care to see that the interest of the labour was well protected. It is said that the FCI had for several years sought to encourage the setting up of labour cooperatives soas to do away with the middleman. Reliance has been placed on certain circulars issued by the FCI in this context. It is contended that to encourage formation of labour co-operatives, preferential treatment at advantageous terms were being given in awarding contracts for handling-cum transport. The Court's attention drawn to the impugned tender notice in this context, in which such preferential treatment has been made clear. It is said that in any event FCI has insisted on the contractors who wished to submit a tender being licenced under the Act. The Court's attention drawn to the impugned tender notice in this context, in which such preferential treatment has been made clear. It is said that in any event FCI has insisted on the contractors who wished to submit a tender being licenced under the Act. It is said that the Supreme Court in a recent decision has in no uncertain terms held that the Court cannot direct issuance of notification under Section 10 of the Act as that was a matter solely within the discretion of the Appropriate Government. ( 6 ) IN the second place, it has been contended by the respondents that before a notification could be issued under Section 10, various factors including the financial ability of the concern would have to be taken into consideration by the Appropriate Government. In this case, the FCI was not in a position to bear the financial burden of taking over the liability of employing casual workers on a permanent basis. It is farther submitted that the object of FCI was to distribute grain at subsidised levels and not to provide employment. ( 7 ) IT is submitted by the respondent that there was no question of regularisation as none of the preconditions for regularisation in service was present. The respondents have also relied upon several decisions in support of their contentions. These will be considered at an appropriate stage in the judgment. ( 8 ) AS far as the question of direct payment was concerned it has been stated that the Memorandum of Understanding under which the direct payment system was entered into was not approved by the competent authority and could not, in fact, be enforced. It is contended that even if the Memorandum of Understanding were to be enforced, in terms of the Memorandum of Understanding between the workers Unions of FCI and FCI, the benefits were restricted to certain godowns only. The godown at Balarampur in which the petitioners were interested had not been mentioned. In any event, it is said that the entire system had in fact, been withdrawn from all godowns. ( 9 ) THE respondents have also submitted that the writ petition is grossly delayed. The godown at Balarampur in which the petitioners were interested had not been mentioned. In any event, it is said that the entire system had in fact, been withdrawn from all godowns. ( 9 ) THE respondents have also submitted that the writ petition is grossly delayed. According to the respondents, the petitioners had claimed to have been in employment for 16 years and although the Act had been in force for several years the petitioners had never claimed absorption under FCI at any point of time. The Respondents say that the petitioners moved the Court only after some other workers of FCI had obtained orders from Court permitting them to continue in employment. According to the respondents, the petitioners had infact, been set up by the labour contractor who wished to exclude competition. ( 10 ) THE primary question in my view turns on the provisions of Section 10 of the Act which provides:-"10. Prohibition of employment of contract labour: (1) Notwithstanding anything contained in this Act, appropriate Government may, after consultation with the Central Board, or as the case may be, a State Board, prohibit, by notification in the Official Gazette, employment of contract labour in any process, operation or other work in any establishment. (2) Before issuing any notification under Sub-section (1) in relation to an establishment, the appropriate Government shall have regard to the conditions of work and benefits provided for the contract labour in that establishment and other relevant factors, such as- (a) Whether the process, operation or other work is incidental to, or necessary for the industry, trade, business, manufacture or occupation that is carried on in the establishment; (b) whether it is of perennial nature, that is to say, it is of sufficient duration having regard to the nature of industry, trade, business manufacture or occupation carried on in that establishment; (c) whether it is done ordinarily through regular workmen in that establishment or an establishment similar thereto; (d) whether it is sufficient to employ considerable number of whole-time workmen. Explanation :- If a question arises whether any process or operation or other work is of perennial nature, the decision of the appropriate Government thereon shall be final". Explanation :- If a question arises whether any process or operation or other work is of perennial nature, the decision of the appropriate Government thereon shall be final". ( 11 ) THE "appropriate Government" as far as the Food Corporation of India is concerned would be the Central Government in accordance with the definition of "appropriate Government" under Section 2 (1) (a) of the Act. ( 12 ) SECTION 10 envisages the exercise of power by the appropriate government in three stages. The first stage is consultation with the Central Board. The Central Board or the Central Advisory Board is constituted under Section 3 of the Act and includes within its members inter alia, the Chief Labour Commissioner (Central) and not less than 11 members to represent the Government, the Railways, the Coal Industries, the mining industry, the contractors and the workmen. The number of members nominated to represent the workmen cannot be less than the number of members nominated to represent the employers and the contractors. The Central Board is required to advise the Central Government on matters arising out of the administration of the Act as may be referred to it. ( 13 ) AFTER consultation with the Central Board, the Central Government is required to take a decision with relation to a particular establishment whether to prohibit contract labour in that establishment. In taking the decision the Government is required to consider the condition of work and benefits provided for the contract labour, whether the work carried out by the contract labour is incidental to or necessary for the industry, whether it is of perennial nature, whether the work is ordinarily done by the regular workman and whether it is sufficient to employ considerable number of whole time workmen. ( 14 ) THE third stage after such decision to prohibit contract labour in the establishment, is to issue a notification in the Official Gazette for such purpose. ( 15 ) ON a construction of Section 10 three aspects are to be highlighted. The first that the Central Government is required to take into consideration the recommendation of the Central Board and that the Central Board represent the cross section of interests involved. It is to be emphasised that the recommendation of the Central Board would cover the interest of the workmen, the contractor and the industry. Therefore the interest of FCI would be a relevant consideration. It is to be emphasised that the recommendation of the Central Board would cover the interest of the workmen, the contractor and the industry. Therefore the interest of FCI would be a relevant consideration. The second aspect is that the factors noted in Section 10 to be considered by the Central Government are not limiting factors. The language shows these are not the only factors which the Central Government will have to take into consideration before deciding to prohibit the employment of contract labour in any establishment. ( 16 ) JUDICIAL decisions on this aspect of the case have also shown that the other factors which may be considered by the Central Government in taking a decision of Section 10 might include the financial condition of the principal employer ( 17 ) THE Third aspect which emerges is that the decision is ultimately that of the appropriate government which may, even after considering the recommendation of the Central Board and inspite of the existence of the factors mentioned in Section 10, decide not to prohibit contract labour in any establishment. The power to decide to prohibit would imply the power not to do so. ( 18 ) EARLIER to the enactment of the Act, disputes relating to the abolition of the contract labour were referred to the Tribunal under Section 10 of the Industrial Disputes Act, 1947. The Tribunal decided the matter on evidence according to settled principles as judicially determined. These principles have now been enacted in the Act. The statute now provides for the safeguards to prevent exploitation of labour either by the contractors or by the principal employer. The Act is now a complete code in itself and the jurisdiction to take a decision relating to the abolition of contract labour has shifted from the Tribunal to the exclusive domain of the Central Government. ( 19 ) IT necessarily follows that the Courts cannot usurp the jurisdiction of the Central Government and short circuit the process envisaged under Section 10 of the Act by directing the issue of a notification under that Section. ( 20 ) THE earlier decisions which were rendered prior to the enactment of the Act cannot be directly relevant on the issues before the Court in this case. ( 21 ) THE petitioners have relied upon the case of Standard Vacuum v. Their Workmen (1960-II-LLJ-238) (SC ). ( 20 ) THE earlier decisions which were rendered prior to the enactment of the Act cannot be directly relevant on the issues before the Court in this case. ( 21 ) THE petitioners have relied upon the case of Standard Vacuum v. Their Workmen (1960-II-LLJ-238) (SC ). In that case the contractors were paying much less to their workmen than the amount paid by the principal employer to its unskilled regular workmen. Further the workmen of the contractors were not entitled to other benefits and amenities such as Provident Fund, Gratuity, Bonus, Privilege Leave, Medical Facilities and Subsidised Food and housing to which the regular workmen of the company were entitled. The Tribunal found that the work carried by the contractors workmen was incidental to the manufacturing process and was necessary for it and was of a perennial nature. It also found that such work was generally done by the workmen in the regular employment of the employer, the Tribunal accordingly directed the abolition of the contract system employed by the principal employer. The Supreme Court, in this background of the facts said; "considering the nature of the work and the conditions of service in the present case we are of opinion that the Tribunal's decision is right and no interference is called for, except that the date should not be changed, for such a direction cannot be put into force with retrospective effect from November 1, 1958". ( 22 ) AS already observed, after the Act came into force the conditions of service of the contractor's labour have been regulated. All contractors supplying contract labour are obliged to obtain licences under the Act. As already seen FCI has also insisted upon the licensing of contractors under Section 12 of the Act. Section 12 of the Act provides as follows:-"12. Licensing of contractors - (1) With effect from such date as the appropriate Government may by notification in the Official Gazette appoint, no contractor to whom this Act applies, shall undertake or execute any work through contract labour except under and in accordance with a licence issued in that behalf by the licensing Officer. Licensing of contractors - (1) With effect from such date as the appropriate Government may by notification in the Official Gazette appoint, no contractor to whom this Act applies, shall undertake or execute any work through contract labour except under and in accordance with a licence issued in that behalf by the licensing Officer. (2) Subject to the provisions of this Act, a licence under Sub-section (1) may contain such conditions including, in particular, conditions as to hours of work, fixation of wages and other essential amenities in respect of contract labour as the appropriate Government may deem fit to impose in accordance with the rules, if any, made under Section 35 and shall be issued on payment of such fees and on the deposit of such sum, if any, as security for the due performance of the conditions as may be prescribed". ( 23 ) RULES have been prescribed by the Central Government and the State Governments under Section 35 of the Act. The Central Government Rules are called the Contract Labour (Regulation and Abolition)Central Rules, 1971. Rule 25 provides for the terms and conditions of every licence. Rule 25 (2) (iv) and (v) is noteworthy. It provides:" (iv) the rates of wages payable to the workmen by the contractor shall not be less than; the rates prescribed under the Minimum Wages Act 1948 (II of 1948 ), for such employment where applicable, and where the rates have been fixed by agreement, settlement or award, not less than the rates so fixed; (v) (a) in cases where the workmen employed by the contractor perform the same or similar kind of work as the workmen directly employed by the principal employer of the establishment, the wage rates, holiday, hours of work and other conditions of service of the workmen of the contractor shall be the same as applicable to the workmen directly employed by the principal employer of the establishment on the same or similar kind of work; provided that in the case of any disagreement with regard to the type of work the same shall be decided by the Chief Labour Commissioner (Central ). (b) in other cases the wage rates, holidays, hours of work and conditions of service of the workmen of the contractor shall be such as may be specified in this behalf by the Chief Labour Commissioner (Central ). (b) in other cases the wage rates, holidays, hours of work and conditions of service of the workmen of the contractor shall be such as may be specified in this behalf by the Chief Labour Commissioner (Central ). Explanation :- While determining the wage rates, holidays, hours of work and other conditions of service under (b) above, the Chief Labour Commissioner shall have due regard to the wage rates, holidays, hours of work and other conditions of service obtaining in similar employment". ( 24 ) THE body of the Act also contains various provisions for the protection of the workmen (see: 17, 18, 19, 20 and 21 of the Act ). The legislature has also taken care to see that there is no infringement of the statutory protection provided to the workmen by providing for penalties in the event of contravention of the provisions regarding the employment of workmen. ( 25 ) IN the case of Standard Vacuum (Supra) the factual situation was a complete absence of all these safeguards and it was established on the basis of evidence on which both the Tribunal and Supreme Court were satisfied that the contract labour in that case was in fact being exploited. ( 26 ) THE second decision cited by the petitioners is the case of Catering Cleaners of Southern Railway v. Union of India (1987-I-LLJ-345) (SC ). In that case the petitioners were catering cleaners of Southern Railways. They were not even paid the minimum wages. Almost all the Railways except the Southern Railway had abolished the contract labour system with regard to catering cleaners. The Supreme Court considered a Report of the Parliamentary Committee of Petitions from which it appeared that the work of cleaning catering establishment was necessary and incidental to the industry or business of the Southern Railway, that it was of a perennial nature, that the work was done through regular workmen in most Railways in the country and that the work required employment of sufficient number of whole time workmen. All the relevant factors mentioned in Section 10 (2) of the Act were satisfactorily accounted for. Yet the Supreme Court refrained from directing the Central Government to abolish the contract labour system under which the cleaners in catering establishments were employed in the Southern Railway because the power to prohibit employment of contract labour had been vested in the appropriate Government. Yet the Supreme Court refrained from directing the Central Government to abolish the contract labour system under which the cleaners in catering establishments were employed in the Southern Railway because the power to prohibit employment of contract labour had been vested in the appropriate Government. However, in the circumstances of the case the Supreme Court directed the Central Government to take appropriate action under Section 10 of the Act within six months. If the Central Government did not decide the question within six months as directed, the Southern Railway was to absorb the workmen into their services and regularise their service. ( 27 ) THIS case is not an authority for the proposition that the writ Court can direct the appropriate Government to issue a notification under Section 10 of the Act. ( 28 ) THERE is no doubt however that once a notification is issued under Section 10, it is subject to judicial review. A notification when issued, may be tested against the rights guaranteed under the Constitution. ' ( 29 ) IN the third decision cited by the petitioner viz. Sankar Mukherjee and Ors. v. Union of India and Ors. (1990-II-LLJ-443) (SC) a notification had been issued by the Government of West Bengal prohibiting the employment to contract labour in 16 departments in the establishment of M/s. Indian Iron and Steel Co. Ltd. ,. As far as the Brick department was concerned, contract labour was abolished with regard to cleaning and stacking and other allied jobs except loading and unloading of bricks from wagons and trucks. A writ petition was filed by the workmen employed in the loading and unloading of bricks from wagons and trucks. The Supreme Court found as a matter of fact that the job of loading and unloading of bricks was incidental or allied to the stacking of bricks. Accordingly no justification existed for excluding the job of loading and unloading of bricks from wagons and trucks from the purview of the notification of Section 10. The exclusion was found to be in violation of Article 14 of the Constitution of India. ( 30 ) THIS case is not an authority for the proposition that the Court can compel the Central Government to issue a notification under Section 10 of the Act. The exclusion was found to be in violation of Article 14 of the Constitution of India. ( 30 ) THIS case is not an authority for the proposition that the Court can compel the Central Government to issue a notification under Section 10 of the Act. ( 31 ) THE issue must be taken to have been conclusively decided against the petitioners by the observations of the Supreme Court in the case of Dena Nath and Ors. v. National Fertilizers Ltd and Ors. (1992-I-LLJ-289)There the Supreme Court held: P 296"it is not for the High Court to inquire into the question and decide whether the employ ment of contract labour in any process, operation or in any other work in any establish ment should be abolished or not. It is a matter for the decision of the Government after considering the matter, as required to be considered under Section 10 of the Act". ( 32 ) THE next question is whether this Court should in any event direct absorption of the petitioners in the FCI. ( 33 ) THE claim of the petitioners cannot be : sustained either under the provisions of the Act, nor on general principles. ( 34 ) EVEN assuming the Central Government could be directed to issue a notification under Section 10 abolishing the contract labour in FCI's depots relating to handling and transport, this would not automatically result in the absorption of the petitioners in FCI. It would only mean that after the prohibition of employment of contract labour relating to handling and transport, if the FCI recruited any workmen for the purpose, all the employees would have to be employed on regular basis. Of course, the Courts have in certain circumstances directed preference to be given on the happening of such eventuality to the workmen employed by the contractor, but the eventuality has not yet arisen in this case. ( 35 ) THE Act only requires that every contractor undertaking to execute any work through contract labour has to have a, licence under the Act and although the workmen employed by the contractor are protected by various statutory safeguards, there is no provision for direct absorption by the principal employer ( 36 ) IT is true that in the unreported decision in C. O. No. 8161 (W)of 1989 : Food Corporation of India Godown Contractors Workers' Union and Anr. v. Union of India (Judgment dated July 2, 1991) a Learned Judge of this High Court has directed absorption of the workmen employed by contractors, in FCI. The Judgment, however, is under appeal and stay of the operation of the order has been granted by the Appellate Court. ( 37 ) IN any event the decision of the Learned Judge that as none of the contractors were licensed contractors under the Act, the employees became the direct employees of the FCI cannot be considered to be good law in view of the decision of the Supreme Court in Dena Nath and Ors. v. National Fertilizers Ltd. and Ors. (supra ). In that case the, Supreme Court had to consider the conflicting views of the different High Courts. The High Courts of Karnataka, Madras, Gujarat and Bombay were of the view that employees of unlicensed contractors became the employees of the principal employer directly. Several of the decisions of these High Courts were rendered in matters relating to the Food Corporation of India. The Karnataka High Court's view was in fact expressed in the case of FCI Loading and Unloading Workers Union v. Food Corporation of India: (1987-I-LLJ-407), ( 38 ) IT may safely be assumed that the Calcutta High Court's view as expressed by the judgment of the learned single Judge in C. O. No. 8161 (W) of 1989 (Supra) was in consonance with the opinion of these High Courts. ( 39 ) THE other view was that taken by the Punjab and Haryana High Court and the Kerala High Court which held that the only consequence of non-compliance by the contractor with Section 12 of the Act was that the Contractor was liable for prosecution but that merely because the contractor may have been unlicensed the employees did not become direct employees of the principal employer. ( 40 ) THE Supreme Court considered the various decisions including the decision in Standard Vacuum (Supra) and overruled the first view and upheld the view of the Kerala and Punjab and Haryana High Courts. It follows that the view of the Calcutta High Court as expressed in the unreported judgment may be taken also to have been overruled along with views of the Bombay, Madras, Kamataka and Gujarat High Courts. It follows that the view of the Calcutta High Court as expressed in the unreported judgment may be taken also to have been overruled along with views of the Bombay, Madras, Kamataka and Gujarat High Courts. ( 41 ) FURTHERMORE, the petitioners have not said that the erstwhile contractor under whom they were : employed was unlicensed under the Act. ( 42 ) THE petitioners also cannot claim absorption dehors the Act, on the ground of continuous service. ( 43 ) ASSUMING that regularisation could be directed on the basis of continuous service in an establishment. I am not satisfied that the petitioners have been able to establish such continuous service on the material before me. ( 44 ) IN the first place, in the opening paragraphs of the writ petition the petitioners have stated that they were appointed on different dates in 1976, 1979, 1980, 1981, 1982, 1983, 1984, 1985, 1986 and 1987. A statement has also been annexed to the Writ petition showing the different dates on which the petitioners commenced working as labour in the depot at Balarampur. In that view of the matter, the statement in subsequent paragraphs of the writ petition that all the petitioners have, been working as handling and casual labour, under FCI for about 16 years is contradictory, ( 45 ) IN the second place, the writ petitioners have also annexed a statement said to have been signed by the District Manager. Food Corporation of India as on November 8, 1991 certifying that 31 writ petitioners were working as gang Labourers at the Balarampur Depot. But the writ petition has been filed by 38 petitioners. ( 46 ) IN the third place, the very fact that the petitioners were appointed on different dates would, seem to indicate that the need of the FCI for a particular number of workers at any point of time was not static. There is also no evidence, apart from the statement in the petition that the petitioners rendered service continuously over the years after their initial appointment. ( 47 ) THERE are no particulars as to the work load at the depot per day nor are there any particulars relating to the number of days in a month when work of loading and unloading is done. ( 47 ) THERE are no particulars as to the work load at the depot per day nor are there any particulars relating to the number of days in a month when work of loading and unloading is done. There is also no evidence to show that in similar establishments the kind of work done by the petitioners is ordinarily done through regular workmen and that it was possible and economically viable for FCI to employ full time workmen for the purpose (See Vegoils (P) Ltd. v. The Workmen (1971-II-LLJ-567) (SC) ( 48 ) THE petitioners are not casual workers directly employed by FCI. Even if they were and if it were held that they had worked continuously at the depot, they could not insist on absorption by FCI as a matter of course. In the case of State of Haryana v. Piara Singh (I993-II-LLJ-937) (SC) the Supreme Court was called upon to consider the question of regularisation of ad-hoc temporary employees, daily wages, casual labour and those engaged temporarily in temporary schemes. In that case the Governments of Punjab and Haryana had issued orders from time to time for regularisation of certain ad-hoc employees of the concerned Governments subject to certain conditions. The High Court held that those employees who had continued in employment on an ad-hoc basis for more than one year were entitled to regularization irrespective of whether they are ad-hoc, daily wagers, casual labour of others. The State Governments appealed from this decision before the Supreme Court. The Supreme Court held that the creation and abolition of a post is the prerogative of the executive ordinarily. But where ad-hoc appointment was continued for long the Court presumes that there was need and warrant for a regular post and accordingly directs regularisation. After considering the earlier views of the Court in this matter a Bench of 3 Judges of the Supreme Court held: at P. 947"the Court must while giving such directions, act with due care and caution. It must first ascertain the relevant facts, and must be cognizant of the several situations and eventualities that may arise on account of such directions. A practical and pragmatic view has to be taken, inasmuch as every such direction not only tells upon the public exchequer but also has the effect of increasing the cadre strength of a particular service class or category". A practical and pragmatic view has to be taken, inasmuch as every such direction not only tells upon the public exchequer but also has the effect of increasing the cadre strength of a particular service class or category". ( 49 ) THE Supreme Court held that the High Court has acted "rather hastily" in directing "wholesome" (wholesale ?) regularisation of all such persons who had put in one year's service. The Supreme Court pointed out that if this was the principle of law there would be no post left for regularly selected persons whose appointments would be foreclosed. The: Supreme Court also held that the absorption would involve the disregarding of the rule relating to reservation in favour of backward class of citizens. The Supreme Court held that the normal rule is regular recruitment through the prescribed agency, which should not be circumvented by ad-hoc appointees being regularised. The decision of the High Court was set aside. ( 50 ) THE Scheme of regularisation which had been formulated by the Governments of Punjab and Haryana were upheld. It is to be noted that the State Statutory/public corporations were directed "to adopt as far as possible, keeping the exigencies of requirements of their administration in view, the criteria and principles underlying the orders issued by their Governments". As for the Statutory/public Corporations under the control of the Government of India the Supreme Court gave no direction but said that such Corporations would do well to evolve an appropriate policy of regularisation, in the light of the judgment. ( 51 ) AGAIN in the case of Delhi Development Horticulture Employees Union v, Delhi Administration (1992-II-LLJ-452) (SC) petitioners who had been given employment under the Jawahar Rozgar Yojna on daily wages, claimed absorption as regular employees of the Development Department of Delhi Administration. The Court rejected the claim taking intp account the limited resources at the disposal of the State. The Court also deprecated the "pernicious consequences" resulting from directions for regularisation of workmen on the only ground that they had put in work for 240 or more days. The Supreme Court said that as a result of such regularisation the Employment Exchange was ignored and persons not registered in the Employment Exchange were given employment before persons who had been registered long in the employment register. The Supreme Court said that as a result of such regularisation the Employment Exchange was ignored and persons not registered in the Employment Exchange were given employment before persons who had been registered long in the employment register. The Court took judicial notice of the fact that employment; for temporary periods was sought and given directly for various illegal considerations including money with a view to give the benefit of regularisation knowing the judicial trend that those who had completed 240 or more days are directed to be automatically regularised. The Court also noted that most of the cases which came to the Courts were of employment in Government Departments, Public Undertaking or Agencies. The Supreme Court then isaid:"ultimately it is the people who bear the heavy burden of the surplus labour. The other equally injurious effect of indiscriminate regularisation has been that many of the agencies have stopped undertaking casual or temporary works though they are urgent and essential for fear that if those who are employed on such works are required to be continued for 240 or more days have to be absorbed as regular employees although the works are time-bound and there is no need for the workmen beyond the completion of the works under taken. The public interests are thus jeopardised on both counts". ( 52 ) IN the circumstances, on the basis of the authorities noted, the petitioners submission that the objects of FCI and its financial constraints were irrelevant in determining the question of regularisation of the petitioners cannot be sustained. In my view the FCI would have to bear the brunt of the employment of larger number of permanent employees. The FCI is funded by the Central Government. Any direction for absorption can be taken on a consideration of the economics of the2 situation based on the fact the FCI is supplying foodstuffs to the poorer levels of society at subsidised rates while at the same time obtaining the food-stuff from the farmers at fair rates of levey. FCI was not set up with the idea of making profits. If it is burdened with the maintenance of a huge increased labour force, it might not be able to discharge its avowed object. FCI was not set up with the idea of making profits. If it is burdened with the maintenance of a huge increased labour force, it might not be able to discharge its avowed object. FCI's averment in its affidavit that:"the subsidy provided by the Government of India so long to the Food Corporation of India to maintain its aforesaid food policy of the Government to cover the deficit of FCI has shrunk sub-stantially". ( 53 ) FCI is at the present moment suffering from want of finance and funds has not been specifically denied by the petitioners. On the basis of the decisions noted earlier, regularisalion cannot be ordered by Court only on the basis of continued length of service without also considering the impact on the public exchequer, the absence of regular vacancies, the increase of cadre strength and the very real possibility that the laudable objects of FCI might grind to a halt with its funds being used not in the subsidisation of the food items to the economically handicapped sections of society or in the payment of fair levy rate to the farmers, but in maintaining an unanticipated and perhaps unnecessary burden of an increased labour force. ( 54 ) THERE can also be no question of the principle of legitimate expectation operating in this case. The petitioners have not disputed that fresh tenders were called nearly every two years for awarding the contract of handling-cum-transport labour at the Depot. In fact, it is the petitioners case that they had rendered service under four different contractors at the Balarampur Depot. The appointment of the contractor was therefore, for a fixed period. At the end of the fixed period, the tenure of the contract and also the work of the contractor's labour would come to an end. The decision in the State of H. P. v. Kailash Chand Mahajan 1992 Supp. (2) SCC 351 does not come to the petitioners aid. In that case the tenure of the writ petitioner had been extended from time to time. Before the expiry of the extended period, as a result of legislation, the tenure of writ petitioner was curtailed. In that context the Supreme Court observed that it might be urged that by the extension of the tenure of appointment there was a right to continue, the legitimate expectation having come to be interfered with. Before the expiry of the extended period, as a result of legislation, the tenure of writ petitioner was curtailed. In that context the Supreme Court observed that it might be urged that by the extension of the tenure of appointment there was a right to continue, the legitimate expectation having come to be interfered with. Here there was no question of curtailment of any tenure of appointment. The fresh tender has been issued admittedly for a period after the previous contractor's tenure had come to an end. It may be noted that the Supreme Court, approved a decision in R. v. Ministry of Agriculture, Fisheries and Food, exparte Jaderaw Limited 1991 (1) ALL ER 41 where a plea of legitimate expectation was negatived on the ground that the right of carrying on an activity was subject to reconsideration every year. ( 55 ) IT must be mentioned at this stage that the initial grievance of the writ petitioners as made in the Writ petition was watered down in the course of the hearing. The petitioners then submitted that the Central Government should be directed only to consider the question of abolition of contract labour with regard to handling and transport in the godowns of FCI and in the meantime the status quo regarding the employment of the petitioners should continue with enforcement of the direct payment system. ( 56 ) INCIDENTALLY in the writ petition the petitioners have complained about the purported move to appoint a fresh contractor by the tender notice dated May 18, 1993". The object of the challenge therefore appears to be the appointment of a new contractor. The language used would appear to lend some credence to the submission of the respondents that the petitioners may have been set up by the erstwhile contractor. Nevertheless I do notintend to decide the questions involved in this writ application on this basis. ( 57 ) NO doubt in some decisions the Supreme Court as well as this Court have issued directions to the Central Government to consider the question of issue of a notification under Section 10 of the Act. ( 58 ) IN my view the petitioners cannot ask for any direction on the Central Government on this application. ( 57 ) NO doubt in some decisions the Supreme Court as well as this Court have issued directions to the Central Government to consider the question of issue of a notification under Section 10 of the Act. ( 58 ) IN my view the petitioners cannot ask for any direction on the Central Government on this application. The directions on the Central Government to consider the question of prohibiting or not prohibiting contract labour relating to handling and transport in the FCI depots might have been allowed if the petitioners had been able to lay the basis for such an application on proven facts before this Court. For example, in the case of Catering cleaners (supra) the Parliamentary Committee of petitions had already gone into the question and came to a finding that the relevant facts under Section 10 (2) of the Act were present. Similarly in a decision of the Division Bench of this Court in the case of Adhir Kumar Chowdhury and Ors. v. State of West Bengal; 1987 I CLR 418 a dispute had been raised on behalf of the petitioners by the Union. This was gone into by the Assistant Labour Commissioner, at Asansol. After the enquiry was made by the Assistant Labour Commissioner a report was submitted by him to the effect that a case had been made out for directing prohibition of employment of contract labour in terms of Section 10 of the Act. The report was forwarded to the Labour Commissioner. A conference was held. No action was taken by the State Government to take a decision in the matter. The Division Bench held that although a mandate could not issue to the State Government to publish a notification under Section 10 of the Act prohibiting the contract labour in respect of the petitioners, nevertheless the State Government was under an obligation to take a decision in respect of the matter one way or the other. ( 59 ) IN this case the factual basis has not yet been enquired into by any authority at any level. ( 60 ) THE petitioners have not even sought to raise the issue before the appropriate Government. The representation was made by the petitioners for the first time was in 1993. The representation was made to the Officers of the FCI who are not the appropriate authorities at all. ( 60 ) THE petitioners have not even sought to raise the issue before the appropriate Government. The representation was made by the petitioners for the first time was in 1993. The representation was made to the Officers of the FCI who are not the appropriate authorities at all. No representation has been made to the Central Government at any stage. The question of the Central Government failing to discharge its obligation one way or another under Section 10 of the Act does not arise nor can the Court take the Central Government to task for its failure to discharge any obligation. ( 61 ) AGAIN, if notifications under Section 10 had already been issued vis-a-vis similar establishments as was the case in the matter of Catering Cleaners (supra) the Court could have directed the Central Government to consider the issuance of a notification in respect of the FCI. No notification has infact been issued in respect of any other depot of FCI. ( 62 ) FINALLY, as already observed, the materials on record as far as the petitioners arc concerned are inadequate and unsatisfactory and wholly insufficient for the Court to act upon. ( 63 ) THE observations in this judgment however must not be taken as precluding the petitioners from raising a dispute under Section 10 before the Central Government in such a manner and on such material as they may be advised. ( 64 ) THIS brings us to the last issue viz. the system of direct payment the benefit of which has been sought to be claimed by the writ petitioners. This relief would be available to the writ petitioners if this Court had come to a finding that the petitioners have a right to continue in the employment of the FCI either by way of absorption or by way of interim measure pending decision of the Central Government under Section 10 of the Act. As this Court has come to no such finding there is no question of either the benefit of the direct payment system or of the status quo of the petitioners employment being granted to the petitioners. ( 65 ) IN any event it is doubtful whether the status quo could have been directed to continue (See Andhra Pradesh Dairy Development Corporation v. K. Ramulu and Ors. ( 65 ) IN any event it is doubtful whether the status quo could have been directed to continue (See Andhra Pradesh Dairy Development Corporation v. K. Ramulu and Ors. (1989-II-LLJ-312) (AP) ( 66 ) BEFORE leaving this issue it needs to be mentioned that the FCI has tried to follow a policy programme of eliminating contract labour. As part of this policy programme as it appears from the several circulars of FCI, the FCI had sought to encourage the formation of Labour Co-operative Societies to replace the contract system. Various concessions were to be granted to the Labour Cooperatives to encourage their formation. For example in Circular No. F. 1/63/89- Cont. dt March 16, 1989 it has been stated:-"the Corporation has to actively participate in the formation of these Societies by lending a helping hand in order to implement the policy of sponsoring Co-operative and to replace the contract system in FCI in phased manner despite problems that are likely to arise in the course on implementing the objective". In order to encourage the formation of Labour Co-operatives Societies, it has since been decided to allow the following additional concessions in addition to those already allowed to these Societies in accordance with Hqrs. Circular No. F. 1/12/80-Cont. dated May 25, 1991 :"1) Extend assistance in the form of Monetary subsidy for paying to the Staff of the Cooperatives on standard scale, taped over a period of three years, 100% in the first year, 50% in the second year and 25% in the third year and "nil" from the fourth year. 2) Extend assistance in the form of accommodation and furniture for the office of the Co operatives Societies on a standard scale. 3) Provide furniture and utensils for the canteens to be run by the Labour Co operative Societies. However, for operational reasons it is desirable that there should be only one Labour Co operative per godown complex. Such Labour Co operative Societies can also be awarded contracts without calling for quotation oh the basis of current schedule of rates". ( 67 ) AGAIN. Circular No. F. 1/63/89-Cont. However, for operational reasons it is desirable that there should be only one Labour Co operative per godown complex. Such Labour Co operative Societies can also be awarded contracts without calling for quotation oh the basis of current schedule of rates". ( 67 ) AGAIN. Circular No. F. 1/63/89-Cont. dated January 19, 1989 provides :-"it has therefore, been decided that the following action should be taken by all the SRMs/rms/jm (POs) : i) Senior Officers should visit all the depots, talk to the labourers working at the depot, help them in forming the Labour Cooperative Societies and getting it registered with the appropriate State Authorities. ii) List containing the names, age etc. of labourers working under the Contract system should be prepared and all of them enlisted as the Members of the Labour Cooperative. iii) They should also be helped in obtaining the licence etc. required under the provision of Contract Labour (Randa) Act, 1970. iv) As and when the existing contracts expire, the next contract should be awarded only to the labour co operatives, if the Societies have the capacity to undertake the work. v) These Labour Co operative Societies should also be encouraged to take composite H and T contracts as far as possible". ( 68 ) CIRCULAR No. 1/91/cont. dated June 11, 1991 records :-"the Board of Directors in their 213th meeting held on June 3. 1991 has decided to grant further concessions to the labour Cooperative Societies as under : i) The Labour Cooperative Societies will undertake the handling operations only in our depots and will be free from risk and cost arrangement as envisaged in the present Model Tender Form of H and T contracts. ii) Labour Cooperative Societies will be entrusted the handling work without invitation of tender on the basis of workable rates to be offered by them and to be finalised by mutual negotiation. ii) Labour Cooperative Societies will be entrusted the handling work without invitation of tender on the basis of workable rates to be offered by them and to be finalised by mutual negotiation. The broad guidelines for determining such workable rate shall be :-a) Statutory minimum wages for similar work as notified for the area; b) Labour strength required as per FCI norms of 90 bags a day per labourer; c) Provision of attendance wages, P. F. , Productivity Incentive Bonus, O. T. and other commitments; d) Demurrage charges, to the extent to be borne by the Society e) Administrative charges ; and f) Reasonable margin to ensure improvement of welfare measures on progressive basis ; g) Any other statutory payments that have to be met by Society. iii) The main deterrent in forming societies is the hardship experienced by the Labour Cooperative Societies on demurrage. The District Managers concerned make all out efforts to obtain as such waiver as possible from the Railways of demurrage charges. However, the demurrage attributable would be shared between the Labour Cooperative Societies and the Transport Contractors in such proportion as may be decided by the District Manager concerned. The decision of the District Manager on holding responsible either of the parties concerned would be final and binding on Transport contractor. Labour Cooperative Society to bear the demurrage charges attributable to their failure and responsibility. These concessions are in addition to the concessions already extended to the Labour Cooperatives over the contractors. These concessions will be available only by labour working in the FCI depots and registered with the appropriate authority under the Cooperative Act". ( 69 ) THE direct payment system referred to in the circular dated October 1, 1986 of FCI was in fact introduced in respect of depots operating under the Labour Mate System. The Labour Mate System was sought to be introduced by the FCI in those depots where it was not feasible to replace the contract system by genuine labour Co operatives. Under the Labour Mate System :"a) The Mate enters into an agreement with Man agement as is done by any contractors. b) The Mate obtains a licence under the Contract Labour (Randa) Act, 1970 where the employment of Labour under a single mate exceeds 20 in number. c) Any loss due to demurrage (wharfage, wilful absenteeism, negligence etc. is borne by mate Labour. b) The Mate obtains a licence under the Contract Labour (Randa) Act, 1970 where the employment of Labour under a single mate exceeds 20 in number. c) Any loss due to demurrage (wharfage, wilful absenteeism, negligence etc. is borne by mate Labour. d) Efforts are made to eliminate malpractices of Dala/mamul System". (Vide Circular No. 4/1989-Cont. dated June 30, 1989 ). The introduction of the Mate system was part of the overall policy programme of eliminating contract labour. No Mate system was operating in the Balarampur Depot, therefore the question of granting the Direct Payment System to the petitioners would not arise. ( 70 ) THIS discussion, although not wholly material in view of my finding on the main issues, was necessary because it evidences that FCI is not exploiting the contract labour but is making an all out effort to organize contract labour so that the labour may benefit without the burden of a huge work force on FCIs permanent staff. ( 71 ) THIS leaves only a minor issue to be determined viz. , the respondents submission that the writ application is delayed. The submission is not acceptable. The Petitioners are not challenging a concluded act. The right claimed by them is a continuing one. In the case of Bhoop Singh v. Union of India (1993-I-LLJ-260) (SC) relied upon by the respondents in this context, the writ petitioner had challenged his dismissal from service 22 years after the event. The application was dismissed on the ground of delay. In determining the question of delay the fact that the petitioner had come after other petitioners similarly situated had their rights judicially upheld was considered. But that case is no authority for the proposition that in every case where a writ petition is filed after a judicial decision the Writ petition must necessarily be rejected on the ground of delay. ( 72 ) HAVING held on the merits against the petitioners on all the issues raised, the Writ application must be and is dismissed. All interim orders are vacated. There will however be no order as to costs. The oral prayer for stay of operation of this order is granted till September 16, 1993 .