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2007 DIGILAW 1568 (BOM)

Industrial Cleaning Services v. C. M. Patil

2007-10-31

NISHITA MHATRE

body2007
JUDGMENT: 1. This writ petition challenges the order of the Industrial Court passed in complaint (ULP) No.316 of 1994 on 9.11.1995. By this order, the Industrial Court has held that the petitioner has indulged in an unfair labour practice under Item 9 of Schedule IV of the MRTU & PULP Act by not paying bonus and ex gratia to 77 employees for the years 1993-94 and 1994-95. The Industrial Court has directed the petitioner to pay the aforesaid amounts in accordance with clauses 10 and 11 of the agreement dated 29.7.1993 u/s 2(p) r/w section 18(1) of the Industrial Disputes Act. 2. The petitioner being aggrieved by this order preferred the present petition. The writ petition was admitted and interim orders were passed. When the matter came up for final hearing on 4.4.2003, the petition was dismissed and rule was discharged. Respondent No.3 was permitted to withdraw the amounts deposit in this Court pursuant to the interim orders with accrued interest. The petitioner then filed a Letters Patent Appeal No.46 of 2003. By an order of April 30, 2003, the Letters Patent appeal was dismissed. At that stage, the Petitioner’s counsel stated that an application for review would be preferred before the learned Single Judge. Accordingly, the review petition was filed and by an order of 2.5.2003, the review petition was dismissed. The petitioner then approached the Supreme Court by filing Civil Appeal Nos.533-534 of 2006. The Civil Appeals were heard and by a common order, the appeals were disposed of. It would be advantageous to set out the order passed by the Supreme Court while disposing of the appeal. "The dispute in the present cases are as to whether certain payments were made to the workers or not. The trial court had proceeded on the assumption that no payments were made. however, it is admitted on behalf of the workers that certain payments were made to them. It remains to be decided that whatever payments that were made, were on what account and under what head. These matters are, therefore, to be considered by an appropriate Court. Accordingly, we remand these matters to the learned Single Judge of the High Court of Bombay to enable him to go into the issue of payment including the nature of payments. These matters are, therefore, to be considered by an appropriate Court. Accordingly, we remand these matters to the learned Single Judge of the High Court of Bombay to enable him to go into the issue of payment including the nature of payments. The impugned orders of the leaned Single Judge as well as in the Letters Patent Appeal of the high Court are set aside. The matters are remitted to the learned Single Judge for decision. Since these are old matters, the High Court should try to dispose them of as early as possible. The appeals are disposed of accordingly." 3. It is in these circumstances, the writ petition is now being heard pursuant to the remand directed by the Supreme Court to consider whether payments made to the workmen were for bonus and ex-gratia, as contended by the petitioner, or the payments were on account of bakshishi, incentive allowance and overtime wages as urged by the Respondent No.3 union. 4. The facts involved in the present petition are as follows: The petitioner is a contractor engaged by Respondent No.2 for cleaning the plant and machinery of Respondent No.2. The contract of service was entered into between the petitioner and respondent No.2 for supplying labour to the petitioner. This contract was renewed from time to time since 1985. The last such contract between the petitioner and Respondent No.2 was signed on 21.2.1994. Earlier on 29.7.1993, the petitioner entered into a settlement with Respondent No.3 under section 2(p) r/w section 18(1) of the Industrial Disputes Act. This settlement pertained to general demands raised by the workmen employed by the petitioner. Clauses 10 and 11 of the settlement were in respect of payment of bonus and ex-gratia, respectively. According to the petitioner, this settlement was signed with the clear understanding that Respondent No.2 would defray the expenses arising out of this settlement. It appears that the petitioner failed to pay the bonus and ex-gratia for the years 1993-94 and 1994-95. Respondent No.3, therefore, filed complaint (ULP) No.316 of 1994 complaining that the petitioner had breached the settlement of 29.7.1993 by not paying bonus and ex-gratia for the year 1993-94. It was prayed that the petitioner be directed to pay bonus and ex-gratia for 1993-94 and thereafter. Respondent No.3, therefore, filed complaint (ULP) No.316 of 1994 complaining that the petitioner had breached the settlement of 29.7.1993 by not paying bonus and ex-gratia for the year 1993-94. It was prayed that the petitioner be directed to pay bonus and ex-gratia for 1993-94 and thereafter. A written statement was filed by the petitioner contending that it was unable to pay any amount to the workers unless Respondent No.2 forwarded the amount to the petitioners. 5. Evidence of Respondent No.3’s witnesses as well as the witnesses of the petitioner and Respondent No.2 was recorded by the Industrial Court. The workers who were examined in the year 1995 by Respondent No.3 categorically stated that they had not been paid bonus and ex-gratia for the years 1993-94 and 1994-95. They have stated in their depositions that besides being paid wages they were being paid bakshishi, bonus, canteen and medical facilities, etc. The workmen deposed that they had received bakshishi for the year 1993-1994 @ 1/3rd of the amount which was paid to the employees of Respondent No.2. This rate was being paid since 1983 till 1994. The workmen have deposed further that Bakshishi deposited in the respective bank accounts of the workmen by the petitioner. One of the witnesses has in his crossexamination stated that for the year 1993, he received bakshishi amounting to Rs.5,000/-. The salary slips of some of the workmen were produced before the Industrial Court by Respondent No.3 to indicate that the payments which were made by the petitioner and received by the workmen were on account of Bakshishi, overtime and incentive allowances. 6. The Proprietor of the petitioner examined himself before the Industrial Court. In para 5 of his deposition, he has stated as follows: "I have not paid a single pai in r/o the said 77 employees towards bonus, ex-gratia, wages, uniform, shoes, etc. out of my amount. It was the understanding among me and Respondent No.1 that the Respondent No.1 is going to pay the said amount." The proprietor of the petitioner has denied that he made any payments to the workers on account of bakshishi, incentive and overtime allowances. Thereafter, he has stated that he does not remember whether he had paid any amount towards these heads on 28.10.1994. He volunteered that some amounts were disbursed to the 77 workmen on account of bonus, overtime incentive and LTA. Thereafter, he has stated that he does not remember whether he had paid any amount towards these heads on 28.10.1994. He volunteered that some amounts were disbursed to the 77 workmen on account of bonus, overtime incentive and LTA. Thus, the petitioner admitted that some amounts were paid but according to the witnesses, these amounts were for bonus and ex-gratia and not on account of the other three heads namely bakshishi, incentive and overtime allowances as contended by Respondent No.3. 7. The Factory Manager of Respondent No.2 was also examined. He has stated in his deposition that Respondent No.2 company had never reimbursed the petitioner the payments made in respect of bonus or bakshishi. In his cross-examination, he has admitted that Respondent No.2 company used to make payment of the bills submitted by their contractor i.e., the petitioner, after which the petitioner paid it over to the concerned workmen, through the Bank. The factory manager has admitted that bonus was payable to the workmen under the Payment of Bonus Act and that Respondent No.2 i.e. the petitioner herein had not submitted any bill for payment of bonus. He has categorically denied that payment made by Respondent No.2 in respect of the bill at Exhibit U95 was for payment of bonus for the year 1993. The witness has also denied making payment for the bill submitted for payment of ex-gratia from April 1993 to March 1994 amounting to Rs.77000/-. Besides this the witness has denied paying any amount towards bonus and ex-gratia for the period from April 1994 to March 1995 on account of the bill submitted by the petitioner on 15.9.1995. 8. On the basis of this evidence led before the Industrial Court, it has held that the petitioner has violated the provisions of the settlement dated 29.7.1993 with respect to payment of bonus and ex-gratia. Consequently it concluded that the Petitioner had committed an unfair labour practice under Item 9 of Schedule IV. 9. Mr.Naik, appearing for the petitioner submits at the outset that the complaint ought to have been dismissed by the Industrial Court since it was filed by the workman contending that they had an employer-employee relationship with Respondent No.2 and that they were not employees of the Contractor, the petitioner herein. 9. Mr.Naik, appearing for the petitioner submits at the outset that the complaint ought to have been dismissed by the Industrial Court since it was filed by the workman contending that they had an employer-employee relationship with Respondent No.2 and that they were not employees of the Contractor, the petitioner herein. He submits that in view of the judgments in the case of Vividh Kamgar Sabha v/s. Kalyani Steels Ltd. & Anr., 2001 (1) CLR 532, Cipla Ltd. v/s. Maharashtra General Kamgar Union & Ors., (2001) 3 SCC 101 and Sarva Shramik Sangh v/s. Indian Smelting and Refining Company Ltd., Appeal No.8452/2003 (SC), the complaint itself ought to have been dismissed by the Industrial Court. 10. This submission of the learned advocate cannot be countenanced since the petitioner had never contested the employer-employee relationship between itself and 77 workmen. Therefore, the complaint filed against the petitioner was maintainable. The aforesaid judgments do not direct the Industrial Court to dismiss the complaint where there is no dispute between the employer and the workmen about their employment with him. It is only when the employment is disputed that the judgments would apply. Therefore, this submission is of no merit. 11. It is then submitted by Mr.Naik that the complaint must be remanded to the Industrial Court to determine under which head the payments have been made by the petitioner and received by the workmen. He urges that the High Court exercising powers under Articles 226 and 227 is not a fact finding Court and, therefore, the Industrial Court would be the proper Court to decide the controversy. He submits that the complaint should be remanded. This submission is also without merit. The Supreme Court while passing the aforesaid order on 13.1.2006 has specifically remanded the matter to "the Single Judge of the High Court of Bombay to enable him to go into the issue of payments including the nature of payments". It is therefore not open to the learned advocate to argue that the High Court cannot determine this issue when a specific direction has been given by the Supreme Court while remanding the writ petition. It was open for the Petitioner to point out when the Civil Appeal was heard by the Supreme Court that it would be proper to remand the matter to the Industrial Court. It was open for the Petitioner to point out when the Civil Appeal was heard by the Supreme Court that it would be proper to remand the matter to the Industrial Court. The Supreme Court being well aware of the jurisdiction of this Court under Articles 226 and 227 has directed this Court to determine the issue regarding payments, including the nature of the payments. In such circumstances, the submission of the learned advocate is without merit. 12. Both the learned advocates appearing for the petitioner as well as the respondent have taken me through the evidence on record, painstakingly. In my opinion, the submission of the learned advocate for the petitioner that bonus and ex-gratia for the years 1993-94 and 1994-95 have been paid is without substance. Respondent No.3 in its complaint had specifically contended that there was non-implementation of the agreement of 29.7.1993 on the part of the petitioner since clauses 10 and 11 of the agreement were violated. Clause 10 deals with payment of bonus while clause 11 relates to payment of an ex-gratia amount of Rs.1000/- to each workman. In its written statement, the petitioner has admitted that these payments have not been made since the amount was not advanced by Respondent No.2 company to it. In para 9 of the written statement of the petitioner, it is pleaded thus: "9. ... The respondent No.2 submits that it is true that the said settlement provides for paying bonus to the employees listed in Annexure A in accordance with the Payment of Bonus Act, 1965 and ex gratia at the time of Diwali at the rat of Rs.1000 per workmen who are on the roll of the respondent no.2 as on 30th September and who have completed a minimum of one year service. The respondent No.2 submits that there is no way in this world that the respondent no.2 would be in a position to pay the said amount to the employees unless and until the same is reimbursed by the respondent No.1. A plain reading of the rates of payment would indicate that it is impossible for the respondent No.2 to make such payments on his own. In fact, in the past every year, the respondent No.1 has reimbursed the said amounts to the respondent No.2 based on which the respondent No.2 has made payments to its employees. A plain reading of the rates of payment would indicate that it is impossible for the respondent No.2 to make such payments on his own. In fact, in the past every year, the respondent No.1 has reimbursed the said amounts to the respondent No.2 based on which the respondent No.2 has made payments to its employees. The respondent No.2 submits that the respondent No.1 has designed an extremely devious and cunning modus operandi to generate record to establish that it does not reimburse these payments to be made to the workmen in accordance with clause 10 and 11 of the settlement dated 29/2/93. The respondent No.2 submits that whenever the question of making such payments to the employees came up the respondent No.1 asked the respondent No.2 to submit bills for additional work or overtime. Furthermore whenever the question of supplying the uniforms, shoes, silver medals and prizes came up, the respondent No.1 has asked the respondent No.2 to submit bills for overtime and additional work. As a matter of fact, on several occasions the respondent no.1 has made direct payments to the parties for purchase of shoes, uniforms, etc. The contention of the respondent No.1 that it does not have any knowledge with regard to any settlement signed by the respondent No.2 with the complainant is, therefore meaningless. The respondent No.2 submits that for the present year the respondent No.1 has not reimbursed the respondent No.2 the amounts to be paid in accordance with the clause 10 and 11 of the settlement dated 29/7/93. It has also to reimburse cost of uniforms and shoes. The default, if any, is therefore, clearly on account of recalcitrant attitude of the respondent No.1. The ulterior motive of the respondent No.1 in not reimbursing these amounts is to frustrate the respondent No.2 so that it voluntarily gives up the said contract. ......." 13. Thus, there can be no dispute at all that payment of bonus and ex-gratia have not been made to the workman. The petitioner has admitted that it is only when Respondent No.2 advanced amounts for paying bonus and ex-gratia was the amount paid to the workman. The petitioner has specifically pleaded that the amount was not disbursed to the petitioner by Respondent No.2 and, therefore, the default was on account of the recalcitrant attitude of Respondent No.1. The petitioner has admitted that it is only when Respondent No.2 advanced amounts for paying bonus and ex-gratia was the amount paid to the workman. The petitioner has specifically pleaded that the amount was not disbursed to the petitioner by Respondent No.2 and, therefore, the default was on account of the recalcitrant attitude of Respondent No.1. In these circumstances, it is impossible to accept the contention of the petitioner that payment on account of bonus and ex-gratia have already been made. Apart from these pleadings, the evidence on record also does not support the contention of the petitioner. 14. The witness of Respondent No.2 has admitted that no reimbursement on account of bonus and ex-gratia has been made. Exhibits U97 and U99 are bills which were submitted by the petitioner when Respondent No.2 for payment of bonus and ex-gratia for the years 1993-94 and 1994-95. The witness for Respondent No.2 has categorically denied making payment of these amounts. The petitioner’s witness has admitted in his cross-examination that payments were made to the workers only after amounts were received from Respondent No.2. Therefore, it is impossible to believe that payments on account of bonus and ex-gratia for the years 1993-94 and 1994-95 have been made. In fact, the letter dated 29.9.1995 written by the petitioner to the union indicates that the petitioner had submitted the bill on 15.9.1995 to the company for payment in respect of bonus and ex-gratia for the year 1994-95. This letter discloses that the petitioner intended to pay the bonus and ex-gratia to the employees on receipt of the amount mentioned in the bill. The letter also states that the company i.e. Respondent No.2 herein by its letter of 19.9.1995 had refused to make payment of the bill. The letter then states that in the event the company does not make payment to the petitioner the question of paying employees’ bonus or ex-gratia does not arise. This letter leaves no doubt regarding the non-payment of bonus and ex-gratia to the employees for the year 1993-94 and 1994-95. 15. The petitioner has contended that some amount has already been paid to the workmen. The workmen have admitted receiving certain amounts which were deposited in their bank accounts directly by the petitioner. A bill dated 14.10.1995 has been submitted by the petitioner to Respondent No.2 for payment of ex-gratia "diwali bakshish" for an amount of Rs.393,516/-. 15. The petitioner has contended that some amount has already been paid to the workmen. The workmen have admitted receiving certain amounts which were deposited in their bank accounts directly by the petitioner. A bill dated 14.10.1995 has been submitted by the petitioner to Respondent No.2 for payment of ex-gratia "diwali bakshish" for an amount of Rs.393,516/-. It is sought to be contended by the petitioner that this amount of Rs.393516/- is not Diwali Bakshish as contended by Respondent No.3 but in fact is payment of ex-gratia under the clause 11 of the agreement dated 29.7.1993. If that was so, then there was no need for the petitioner to seek payment of Rs.393516/- when admittedly, the ex-gratia which each employee was entitled to under clause 11 was Rs.1000/-. There were only 77 employees concerned and, therefore, by a simple arithmetical calculation, the petitioner would have demanded an amount of Rs.77,000 for payment of ex-gratia as it has done in the bills at Exhibit U 97 and & 99. Therefore, the contention that bonus and ex-gratia has already been paid is unsustainable. Besides this, the salary slips of S.A. Khan which were on record indicates that an ex-gratia payment has been made to him of Rs.381.61 which according to Respondent No.3 is in fact the amount for overtime wages. Incentive allowance of Rs.216/- has also been paid besides payment of Bakshishi. The salary slip of one Baburao Dhumal which is also on record indicates that ex-gratia payment of Rs.1815.7 was made in September 1995. However, this payment is beyond the amount payable as ex-gratia under the agreement and, therefore, the submission of the learned advocate for Respondent No.3 that the amount is paid towards overtime wages must be accepted. In fact, the workman in their deposition, have admitted having received these amounts. Dhumal was examined before the Industrial Court and he has admitted that he received the amount payable as Bakshishi in his bank account. He has also stated that he has not received any bonus or ex-gratia payments for the yeas in question. This witness has not been cross-examined by the petitioner in any detail at all. No suggestion has been put to this witness or any of the workman examined before the Court that the amount received by them was towards bonus and ex-gratia for the years 1993-94 and 1994-95. 16. This witness has not been cross-examined by the petitioner in any detail at all. No suggestion has been put to this witness or any of the workman examined before the Court that the amount received by them was towards bonus and ex-gratia for the years 1993-94 and 1994-95. 16. In my view, therefore, there can be no manner of doubt that the payments made by the petitioner were not on account of bonus and ex-gratia but on account of Bakshishi, incentive allowance and overtime wages. There is ample evidence on record to support the contention of Respondent No.3. Statements have been filed by the petitioner indicating that it has paid bonus for the year 1993-94, ex-gratia for 1994, LTA for 1994, overtime allowance incentive to the workmen. There is no denial of the evidence of the workers that they were entitled to Bakshishi amounting to 1/3rd of the amount received by the workmen directly employed by Respondent No.2. The contention of the petitioner that Leave Travel Assistance has also been paid to the workmen is not substantiated by the petitioner. The agreement discloses that leave travel assistance was payable in January of each year amounting to Rs.500/- per year. The amounts have been deposited in the bank accounts of the workmen in October 1994. Therefore, the question of these amounts including LTA does not arise. 17. The contention of the petitioner that the amounts of bonus and ex-gratia for 1993-94 and 1994-95 have been made is unsustainable and without any merit. There is no evidence in support of such a claim made by the petitioner. The order of the Industrial Court directing the petitioner to make payments in respect of bonus and ex-gratia must be implemented. The petitioner was directed to deposit an amount of Rs.154,000/- in this Court towards the dues payable under the order impugned in this petition. This amount has been invested in a nationalised bank. The amount shall be paid to the workmen together with the interest accrued, if not already withdrawn by the workmen. 18. Petition dismissed. Rule discharged with costs. 19. At this stage, the learned advocate for the Petitioner seeks a stay of this order. Stay refused.