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Andhra High Court · body

2004 DIGILAW 506 (AP)

Deccan Chronicle, rep. by its Managing Partner T. Venkatram Reddy v. G. Pedda Reddy

2004-04-22

K.C.BHANU

body2004
K. C. BHANU, J. ( 1 ) W. P. NO. 27736 of 1995 is directed against the award, dated 20-4-1995 in i. D. No 392 of 1993 passed by the Addl. Industrial Tribunal-cum-Addl. Labour Court, hyderabad, wherein, the writ petitioner herein was directed to reinstate the 1st respondent herein into service with full back wages, continuity of service and other attendant benefits whereas, W. P. No. 23013 of 1995 is filed against the order, dated 22-4-1995 in M. P. No. 19 of 1994 passed by the Addl. Industrial Tribunal-cum-Addl. Labour Court, Hyderabad, wherein, the writ petitioner herein was ordered to pay an amount of Rs. 72,193-16 ps. to the 1st respondent herein towards monetary benefits within one month. ( 2 ) SINCE the parties are one and the same in both the writ petitions and the dispute is with regard to the employment of the 1st respondent herein with the writ petitioner, these writ petitions are dealt with by a common order. ( 3 ) FOR better appreciation of the facts, the parties are referred to as arrayed in I. D. No. 392 of 1993. ( 4 ) A few facts in brief that are necessary for the purpose of disposal of W. P. No. 27736 of 1995 may be stated as follows: the petitioner, who is the workman, raised a dispute under Section 2-A (2) of the industrial Disputes Act, 1947 (hereinafter referred to as "the Act") before the additional Industrial Tribunal-cum-Addl. Labour Court, Hyderabad with the following averments: he was appointed as Security Guard by the respondent on 1-9-1986 and worked as such till 22-11-1991. The petitioner studied upto S. S. C. (Secondary School Certificate) and worked as Home Guard for 4 years. He applied for the post of Security Guard in pursuance of an advertisement made by the respondent in Deccan Chronicle on 25-5-1986 and he was appointed for the said post in pursuance of an interview held on 25-5-1986. He was initially paid Rs. 8007- p. m. by the respondent. He was covered under the Employees State Insurance (E. S. I. ). The petitioner and other Security guards have been demanding the employer for benefits like scale of pay, contributory provident fund, leave with wages, bonus, dearness allowance, conveyance allowance and night duty allowance etc. , but, these benefits were denied to them. He performed his duty on 22-11-1991 and availed weekly off on 23-11-1991. The petitioner and other Security guards have been demanding the employer for benefits like scale of pay, contributory provident fund, leave with wages, bonus, dearness allowance, conveyance allowance and night duty allowance etc. , but, these benefits were denied to them. He performed his duty on 22-11-1991 and availed weekly off on 23-11-1991. He was on E. S. I, leave from 24-11 -1991 to 2-12-1991 as he fell sick. He went to the office on 3-12-1991 but he was not allowed to perform his duty. The managing partner informed the petitioner that his services were no longer required. The petitioner was not served with any charge sheet and no domestic enquiry was conducted against him. His services were terminated as he demanded better service conditions. Therefore, the termination order dated 3-12-1991 is illegal and void. ( 5 ) THE employer filed counter stating that the petitioner was appointed by Annapurna security Services on 1-9-1986 to look after the security arrangements. The respondent was in need of Security Guards. So, annapurna Security Services has been deputing Security Guards to the respondent. The allegation that the Managing Partner of the respondent is also the Managing Partner of Annapurna Security Services is false. The petitioner was deputed to several places by the respondent for discharging his duties. On 21-11-1991, he was posted at the Bungalow of the Managing Partner. The petitioner abused the Managing Partner in a State of intoxication. So, the petitioner was sent back to Annapurna Security Services. The petitioner was not appointed by the respondent. The petitioner is only a contract labour and he is not entitled to any relief. ( 6 ) TO substantiate the case of the petitioner, two witnesses were examined and 17 documents were marked. On behalf of the employer, two witnesses were examined and 9 documents were marked. ( 7 ) AFTER considering the evidence on record, the Labour Court found that the very letter, Ex. M-2 filed by the respondent surrendering the petitioner to Annapurna security Services amounts to termination of services and is without justifiable cause. Therefore, the petitioner is entitled to reinstatement into service with the respondent with full back wages, continuity of service and other attendant benefits. Aggrieved by the same, the writ petition is filed. M-2 filed by the respondent surrendering the petitioner to Annapurna security Services amounts to termination of services and is without justifiable cause. Therefore, the petitioner is entitled to reinstatement into service with the respondent with full back wages, continuity of service and other attendant benefits. Aggrieved by the same, the writ petition is filed. ( 8 ) A few facts in brief that are necessary for the purpose of disposal of the W. P. No. 23013 of 1995 may be stated as follows: the petitioner was appointed as Security guard in the respondent-company on 1-9-1986 on a consolidated salary of rs. 800/- per month. The respondent promised that he would place the petitioner at suitable scale of pay with increments and other benefits applicable to other employees after completion of one year of service. He was made to work both in the office and at the residence of the Managing Partner. The petitioner and other Security Guards approached the respondent demanding the payment of service benefits like bonus, scale of pay, etc. , but the same were not complied with. The respondent enhanced the salary of the petitioner to Rs. 900/- p. m. from January, 1989 onwards. The Government appointed a wage Board in 1985 and accepted its recommendations for revision of wages of the working journalists and non-journalists to news paper employees, by an order, dated 31 -8-1989. These wages are applicable from 1-1-1988. The petitioner has been placed in the pay scale of non-journalist group-IV employees. The respondent implemented the said order in respect of all other employees except the petitioner. Hence, the petitioner prays to pay an amount of rs. 75,953-16 ps. as per the schedule. ( 9 ) THE respondent filed counter stating that the petitioner was appointed in annapurna Security Services, which deputed the petitioner to the respondentorganization. The respondent never appointed the petitioner. The petitioner was paid Rs. 800/- p. m. from 1-9-1986 and rs. 900/- p. m. from 1-1-1989. The petitioner is only a contract labour. So, the recommendations of the Wage Board accepted by the Government do not apply to the petitioner. The respondent implemented the recommendations to all the permanent employees. As the petitioner abused the managing Partner of the respondent on 21-11-1991, he was sent back to Annapurna security Services and the services of the petitioner were not terminated on 3-12-1991. Therefore, he prays to dismiss the petition. The respondent implemented the recommendations to all the permanent employees. As the petitioner abused the managing Partner of the respondent on 21-11-1991, he was sent back to Annapurna security Services and the services of the petitioner were not terminated on 3-12-1991. Therefore, he prays to dismiss the petition. ( 10 ) TO substantiate the case of the petitioner, one witness was examined and seven documents were marked. On behalf of the respondent, one witness was examined and two documents were marked. ( 11 ) UPON considering the evidence on record, the Tribunal held that the petitioner is entitled to a sum of Rs. 72,193-16 ps. Aggrieved by the same, W. P. No. 23013 of 1995 is filed. ( 12 ) SRI D. Prabhakar Reddy, learned counsel for the petitioner in both the writ petitions vehemently contended that the petitioner-management never appointed 1st respondent-workman as security guard and the management availed the services of the 1st respondent as Security Guard from 1-9-1986 to 21-11-1991. As the 1st respondent-workman misbehaved with the managing Director of the employer, he was sent back to Annapurna Security Services. Therefore, there is no employer and employee relationship between the petitioner-management and the workman. The 1st respondent-workman did not file any appointment order to the effect that he was appointed by the petitioner-management and further the employer did not give any termination order to the 1st respondent workman. As the principal employer i. e. , petitioner-management deducted certain amounts from the salary of the workman and paid towards E. S. I, contributions as required under the law, the Tribunal, without considering the evidence on record, gave a perverse finding. Once this Court comes to the conclusion that the workman is not an employee of the writ petitioner, the question of payment of any salary in pursuance of the orders passed in M. P. No. 19 of 1994 does not arise. Hence, he prays to set aside the findings of the Tribunal. ( 13 ) ON the other hand, Sri. Md. Mumtaz pasha, learned counsel for the 1st respondent-workman contended that in pursuance of the notification dated 25-5-1986, R1 was appointed with annapurna Security Services, which was floating with a view to get over the recommendations of the Bachawat s tribunal and the management was paying employees State Insurance Contribution. ( 13 ) ON the other hand, Sri. Md. Mumtaz pasha, learned counsel for the 1st respondent-workman contended that in pursuance of the notification dated 25-5-1986, R1 was appointed with annapurna Security Services, which was floating with a view to get over the recommendations of the Bachawat s tribunal and the management was paying employees State Insurance Contribution. The labour Court, after considering the evidence on record, came to the right conclusion in allowing the petition filed by the workman and it is a fact finding one. Therefore, the findings of the Tribunal cannot be interfered with in exercise of the extraordinary jurisdiction under Article 226 of the Constitution of India. Therefore, he prays to set aside the writ petition. ( 14 ) THE finding of perversity or being erroneous or not in accordance with law shall have to be recorded with reasons in order to assail the findings of the Tribunal or labour Court. It is not for the High Court to go into the factual aspects of the matter. The dispute is with regard to the employee and employer relationship in this case. It is the specific case of the workman that on 1 -9-1986, the petitioner-employer appointed him and he continued as Security Guard till 22-11-1991. It is the further case of the workman that in pursuance of the paper notification, dated 25-5-1986 in Deccan chronicle, he applied for the post of Security guard and he was appointed for the said post in pursuance of an interview held on 19-8-1986. ( 15 ) ON the other hand, the case of the petitioner-management is that the 1st respondent was appointed by Annapurna security Services to look after the security arrangements of the writ petitioner. On 1-9-1986, when the 1st respondent workman misbehaved with the Managing partner of the employer, the workman was sent back to the Annapurna Security services and he was not at all appointed by the petitioner-management and he is only a contract Labour. Whether a particular relationship between employer and employee is genuine or a camouflage through the mode of contract is essentially a question of fact to be determined on the basis of the features of the relationship, the written terms of contract if any and in actual nature of employment. Whether a particular relationship between employer and employee is genuine or a camouflage through the mode of contract is essentially a question of fact to be determined on the basis of the features of the relationship, the written terms of contract if any and in actual nature of employment. On this aspect, it is pertinent to refer to a recent decision reported in Ram Singh v. Union Territory, chandigarh wherein, their Lordships held as under:"in determining the relationship of employer and employee, no doubt, "control" is one of the important tests but is not to be taken as the sole test. In determining the relationship of employer and employee, all other relevant facts and circumstances are required to be considered including the terms and conditions of the contract. It is necessary to take a multiple pragmatic approach weighing up all the factors for and against an employment instead of going by the sole "test of control". An integrated approach is needed. "integration" test is one of the relevant tests. It is applied by examining whether the person was fully integrated into the employer s concern or remained apart from and independent of it. The other factors, which may be relevant are - who has the power to select and dismiss, to pay remuneration, deduct insurance contributions, organize the work, supply tools and material and what are the "mutual obligations" between them. Normally, the relationship of employer and employee does not exist between an employer and a contractor and the servant of an independent contractor. Where, however, an employer retains or assumes control over the means and method by which the work of a contractor is to be done, it may be said that the relationship between employer and employee exists between him and the servants of such a contractor. In such a situation, the mere fact of formal employment by an independent contractor will not relieve the master of liability where the servant is, in fact, in his employment. In that event, it may be held that an independent contractor is created or is operating as a subterfuge and the employee will be regarded as the servant of the principal employer. In that event, it may be held that an independent contractor is created or is operating as a subterfuge and the employee will be regarded as the servant of the principal employer. "in another decision reported in Steel authority of India Limited v. National Union waterfront Workers, the Apex Court has explained the nature of the right of contract employees in various contingencies and held as follows:"on issuance of prohibition notification under Section 10 (1) of the CLRA Act prohibiting employment of contract labour or otherwise, in an industrial dispute brought before it by any contract labour in regard to conditions of service, the industrial adjudicator will have to consider the question whether the contractor has been interposed either on the ground of having undertaken to produce any given result for the establishment or for supply of contract labour for work of the establishment under a genuine contract or is a mere ruse/camouflage to evade compliance with various beneficial legislations so as to deprive the workers of the benefit thereunder. If the contract is found to be not genuine but a mere camouflage, the so-called contract labour will have to be treated as employees of the principal employer who shall be directed to regularize the services of the contract labour in the establishment concerned subject to the conditions as may be specified by it for that purpose in the light of para 6 hereunder. "bearing the above principles, it has to be seen, whether the industrial adjudicator gave a proper or perverse finding based on the evidence available on record. The Tribunal, having appreciated the evidence on record, came to the conclusion that from 1 -10-1986 to March, 1988, the 1st respondent and other security guards were shown as security Staff of Deccan Chronicle and it is only in the returns filed in April, 1989 onwards, the contractor-Annapurna Security services was introduced. Therefore, the tribunal held that the workman is an employee of the petitioner-management and not of Annapurna Security Services. Ex. MW-2 is filed by the petitionermanagement surrendering the 1st respondent-workman to Annapurna Security services, which according to the Tribunal amounts to termination of service. Therefore, the tribunal held that the workman is an employee of the petitioner-management and not of Annapurna Security Services. Ex. MW-2 is filed by the petitionermanagement surrendering the 1st respondent-workman to Annapurna Security services, which according to the Tribunal amounts to termination of service. Having come to the Court and taken a plea that the workman was an employee appointed by the petitioner-management in pursuance of notification and subsequent interview, it is for the workman to establish that he was, as a matter of fact, recruited and appointed by the employer especially when a specific plea has been taken by the petitioner-employer that it did not appoint him as Security Guard. The 1st respondent-workman has not filed any appointment order nor any other material to show that he was appointed by the employer in pursuance of the advertisement, dated 25-5-1986 in Deccan chronicle nor that he was actually interviewed by the writ petitioner. Ex. W-17 is the advertisement. A perusal of this document shows that the advertisement was not given by the petitioner-management but the advertisement was published at the request of a customer. That is the reason why a Box No. D. L. 5029, C/o. Deccan chronicle, Secunderabad was given. Exs. W-2 to W-4 are the xerox copies of the attendance register relating to June, 198 7/01/1991 and November, 1991 respectively. Ex. W-5 is the benefit payment slip issued by E. S. I. Ex. W-6 is the fitness certificate. Ex. W-10 is xerox copy of declaration form and Exs. 11 to 16 are the return forms submitted by Deccan chronicle. In Exs. W-14 to 16, the 1st respondent-workman and other security guards were shown as Security Staff of deccan Chronicle whereas, in Exs. W-11 and 12 in the column "name and address" of the establishment, it is noted as Annapurna security Services. According to the 1st respondent-workman, he was shown as security guard of Annapurna Security services when Justice Bachawat Committee gave its report in the year 1988, which was accepted by the Government on 31-3-1989. If one looks into Ex. W-11 relating to the return filed for the period form 1 -10-1988 to 31-3-1989 which was submitted in April, 1989, long prior to the acceptance of Justice bachawat Committee s report by the government, the name and address of the establishment of the petitioner-management was shown as Annapurna Security Services. If one looks into Ex. W-11 relating to the return filed for the period form 1 -10-1988 to 31-3-1989 which was submitted in April, 1989, long prior to the acceptance of Justice bachawat Committee s report by the government, the name and address of the establishment of the petitioner-management was shown as Annapurna Security Services. In any view of the matter, these documents do not clearly establish that the 1st respondent-workman was recruited and employed by the petitioner-management. ( 16 ) UNDER Section 40 of the Employees state Insurance Corporation Act, the principal employer shall pay all the required contributions to all the employees. These documents were submitted in statutory compliance of the provisions under E. S. I. Act. The evidence of WW1 was not at all referred to by the Tribunal. In the first instance, as the workman pleaded that he was appointed by the employer Deccan chronicle, it is for him to establish that he was duly appointed in pursuance of the advertisement, dated 25-5-1986. Without considering the evidence of WW1, basing on some documents, which are not at all relevant to support the case of the 1st respondent-workman, the Tribunal gave a finding, which, in my considered opinion is a perverse finding because the evidence of most important witness, who is the workman has not been considered at all nor referred to in the judgment. On the other hand, the tribunal held that there is a burden on the 1st respondent-workman to establish the employee and employer relationship between the 1 st respondent-workman and the petitioner-management and ultimately gave a finding that no other document with regard to the existence of Annapurna security Services is filed into Court; that the communications said to have been taken place between Annapurna Security Services and the Deccan Chronicle are not filed; and therefore, the 1st respondent-workman failed to prove the existence of Annapurna security Services, which entered into a contract with Deccan Chronicle for the supply of Security Supervisors or Guards as contract labour. The appreciation of the evidence on record, in my considered opinion, cannot be said to be correct because the findings are based upon no evidence. It is for the 1st respondent- workman to establish the employer and employee relationship between him and the petitioner-management and no appointment order to that effect is filed. The appreciation of the evidence on record, in my considered opinion, cannot be said to be correct because the findings are based upon no evidence. It is for the 1st respondent- workman to establish the employer and employee relationship between him and the petitioner-management and no appointment order to that effect is filed. The advertisement is said to have been given by some other person but not by Deccan chronicle, who is the principal employer. Further, the Tribunal did not consider the evidence of W. W. 2. W. W. 1 got issued a legal notice Ex. W-7 to the writ petitioner wherein, he categorically admitted that he was appointed Security Guard and joined duty on 1-9-1986 in Annapurna Security services, a sister concern of Deccan chronicle. W. W. 1 admitted about the issuance of such notice through his advocate, Sri Karandas. It is not the case of w. W. 1 that he has not given instructions to his Advocate with regard to his appointment as Security Guard in Annapurna Security services. The Tribunal, on this aspect, held that the workman cannot be attributed the knowledge of legal implications and therefore, Ex. W-7 did not bind the petitionermanagement. That may be so, in case the workman did not give any instruction with regard to the appointment in the Annapurna security Services. Ex. W-7 was wrongly interpreted by the Tribunal which, in my considered opinion, is a perverse finding. The Tribunal also relied upon Ex. W-9 wherein, the employee requested m/s. Madhav Textiles, Secunderabad for the supply of 5 metres of Khaki terri-cotton cloth to the petitioner-management. By seeing this document, it cannot be inferred that there was an employer and employee relationship between the workman and the writ petitioner herein. If really the writ petitioner appointed the 1st respondent as Security Guard, there is no need for the writ petitioner to surrender the services of the 1st respondent to annapurna Security Services. As per ex. M-2, dated 22-11-1991, if really the workman was employed by the writ petitioner as Security Guard, definitely the writ petitioner would have taken disciplinary action against the workman for misbehaving with its Managing Partner and the question of surrendering the workman to Annapurna security Services does not arise. It is not the case of the workman that the said document ex. M-2 was fabricated for the purpose of this case. Ex. It is not the case of the workman that the said document ex. M-2 was fabricated for the purpose of this case. Ex. M-2 is the letter, dated 23-7-1986 addressed to Annapurna Security services by the writ petitioner wherein, the writ petitioner agreed to avail the services of annapurna Security Services with certain terms and conditions. Ex. M-2 is also not specifically denied or disputed in the crossexamination. When it is the specific case of the writ petitioner that the 1st respondent was not at all appointed by the writ petitioner, there must be some legal evidence to show that there was an employer and employee relationship existing between 1st respondent-workman and the writ petitioner. Basing on the premise that the name and address of the establishment is noted as deccan Chronicle in Exs. 11 to 16, the tribunal gave an incorrect finding. Even as per WW2 s evidence, it is clear that the principal employer is liable to pay contribution to the E. S. I. Fund, whether the workman may be a contract labour or a casual/temporary or permanent employee. As principal employer, the writ petitioner might have contributed certain amounts to the credit of E. S. I, in the name of the 1st respondent-workman but, that does not mean the 1st respondent-workman was appointed by the writ petitioner. The relevant evidence has not been taken into consideration by the Tribunal and gave an incorrect finding. ( 17 ) FROM the evidence on record, it is clear that the 1st respondent-workman miserably failed to establish that the writ petitioner appointed him as Security Guard. As there is no relationship of employer and employee, the question of termination does not arise. It is not proper on the part of the tribunal in accepting the surrender letter as termination of the 1st respondent-workman to Annapurna Security Services as he is alleged to have misbehaved with the managing Partner of the writ petitioner. Ex. M-2, dated 22-11-1991 cannot be treated. as an order of termination. Therefore, from the evidence on record, the tribunal gave an incorrect finding. Hence, the award, dated 20-4-1995 in I. D. No. 392 of 1993 passed by Addi. Industrial Tribunal-cum-Addl. Labour Court, Hyderabad, dated 20-4-1995 is liable to be set aside and it is accordingly quashed. Ex. M-2, dated 22-11-1991 cannot be treated. as an order of termination. Therefore, from the evidence on record, the tribunal gave an incorrect finding. Hence, the award, dated 20-4-1995 in I. D. No. 392 of 1993 passed by Addi. Industrial Tribunal-cum-Addl. Labour Court, Hyderabad, dated 20-4-1995 is liable to be set aside and it is accordingly quashed. ( 18 ) IN view of the above findings, the 1st respondent-workman is not entitled to any payment of wages as per Justice Bachawat committee s Report. When it is a clear case of the writ petitioner that the recommendations of the Wage Board which were accepted by the Government do not apply to the 1st respondent-contract employment, the question of giving a finding by the Tribunal that the 1st respondent did not dispute the amounts claimed in the schedule-1 and 2 in the counter is perverse. M. W. 1 only stated that the management was paying all the amounts claimed in the schedule-1 and 2 to the permanent employees. The 1 st respondent-workman is not found to be the employee of the writ petitioner. Therefore, he is not entitled to any amount as granted by the Tribunal. ( 19 ) FOR the foregoing reasons, the order, dated 22-4-1995 in M. P. No. 19 of 1994 passed by the Addl. Industrial Tribunal-cum-Addl. Labour Court, Hyderabad is also quashed. ( 20 ) IN the result, both the writ petitions are allowed. In the circumstances of the case, there shall be no order as to costs.