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Karnataka High Court · body

2007 DIGILAW 180 (KAR)

SRINIDHI ANANTHARAMAN v. UNION OF INDIA

2007-03-14

SUBHASH B.ADI

body2007
ORDER W.P. No. 30595 of 2003 is filed by Sri Srinidhi Anantharaman, Managing Director of M/s. Geo Desic Techniques Private Limited, seeking declaration that, the State Government is the Appropriate Government in respect of the Hindustan Aeronautics Limited, Bangalore under Section 2, sub-section (1), clause (a), sub-clause (ii) of the Contract Labour (Regulation and Abolition) Act, 1970 (hereinafter referred to as 'CLRA Act') and under Section 2, clause (a) of the Industrial Disputes Act, 1947 (hereinafter referred to as the I.D. Act') and for a declaration that the 5th respondent-Inspecting Officer of the State Government is the Competent Authority. 2. W.P. No. 30593 of 2003 is also filed for declaration similar to the above relief. 3. In these writ petitions, the only question that is raised is.- "Whether the State Government is the Appropriate Government within the meaning of Section 2, sub-section (1), clause (a), sub-clause (ii) of CLRA Act and Section 2, clause (a) of the I.D. Act in respect of Hindustan Aeronautics Limited, Bangalore ?" 4. Case of the petitioners is that, the Company as the Principal Employer by letter dated 24-4-2002, applied for licence to engage the contract labourers on the project from the Competent Authority under the provisions of the CLRA Act and the Rules framed by the Government of Karnataka, in prescribed Form V and the Government of Karnataka, granted licence to engage the contract labourers under the provisions of CLRA Act. Further stated that, the practice earlier was that the contract labour licence used to be obtained from the Central Governmental Authorities, however, as per the verdict of the Supreme Court in the case of Steel Authority of India Limited and Others v National Union Waterfront Workers and Others, the State Government is treated as appropriate Government and the State Government has been granting licence to the petitioner and in pursuance of the licence obtained from the appropriate Government, the petitioners have complied with the requirement of licence. 5. When the matter stood thus, on 20th February, 2003, the third respondent without any authority or jurisdiction inspected the site of the petitioner-Company and at that time, the concerned persons of the petitioners were not present, and the Site Engineer of the petitioner Company was alone present, and he explained to the said Inspector and also furnished the records maintained under various labour laws. The said Engineer also offered to produce all the records before the Inspecting Authority, if he was permitted to do so on a date, time fixed in this behalf. However, a show-cause notice dated 20th February, 2003 was issued by the respondent 3 calling upon the petitioner-Company to show cause as to why action should not be taken against petitioner for violation of the provisions of CLRA Act. Petitioner had sought for extension of time till 20th March, 2003 to submit his explanation, and the Company promptly submitted a detailed explanation to the said Inspector on 17-3-2003 inter alia, stating that, they had obtained the licence from the 5th respondent i.e., the Assistant Labour Commissioner, Department of Labour, Government of Karnataka. However, without considering the same, proceedings were initiated to prosecute the petitioner-Company by the 4th respondent before the learned Metropolitan Magistrate in C.C. No. 1981 of 2003 (in W.P. No. 30595 of 2003) and C.C. No. 1979 of 2003 (in W.P. No. 30593 of 2003) under the provisions of Section 23 of the CLRA Act, alleging that the petitioner has violated the provisions of the Act by not obtaining the licence from the appropriate Government. It is in this regard, the petitioner has sought for declaration that the appropriate Government for the 6th respondent is the State Government and not the Central Government. 6. Learned Counsels for the petitioners submits that the definition of 'appropriate Government' under Section 2, sub-section (1), clause (a), sub-clause (ii) of the CLRA Act, which reads thus: "(a) "Appropriate Government" means.- (i) in relation to an establishment in respect of which the appropriate Government under the Industrial Disputes Act, 1947 (14 of 1947), is the Central Government, the Central Government; (ii) in relation to any other establishment, the Government of the State in which that other establishment is situate". Learned Counsel relying on this definition, referred to the definition of "appropriate Government" under Section 2, clause (a), sub-clause (i) of the I.D. Act, which reads as under: "(a) "Appropriate Government" means.- (i) in relation to any industrial disputes concerning any industry carried on by or under the authority of the Central Government or by a railway company or concerning any such controlled industry as may be specified in this behalf by the Central Government or in relation to an industrial dispute concerning a Dock Labour Board established under Section 5-A of the Dock Workers (Regulation of Employment) Act, 1948 (9 of 1948), or the Industrial Finance Corporation of India Limited formed and registered under the Companies Act, 1956 (1 of 1956), or the employees' State Insurance Corporation established under Section 3 of the Employees' State Insurance Act, 1948 (34 of 1948), or the Board of Trustees constituted under Section 3-A of the Coal Mines Provident Fund and Miscellaneous Provisions Act, 1948 (46 of 1948), or the Central Board of Trustees and the State Boards of Trustees constituted under Section 5-A and Section 5-B, respectively, of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 (19 of 1952), or the Life Insurance Corporation of India established under Section 3 of the Life Insurance Corporation Act, 1956 (31 of 1956), or the Oil and Natural Gas Corporation Limited registered under the Companies Act, 1956 (1 of 1956), or the Deposit Insurance and Credit Guarantee Corporation established under Section 3 of the Deposit Insurance and Credit Guarantee Corporation Act, 1961 (47 of 1961), or the Central Warehousing Corporation established under Section 3 of the Warehousing Corporations Act, 1962 (58 of 1962), or the Unit Trust of India established under Section 3 of the Unit Trust of India Act, 1963 (52 of 1963), or the Food Corporation of India established under Section 3, or a Board of Management established for two or more contiguous States under Section 16 of the Food Corporations Act, 1964 (37 of 1964), or the Airports Authority of India constituted under Section 3 of the Airports Authority of India Act, 1994 (55 of 1994), or a Regional Rural Bank established under Section 3 of the Regional Rural Banks Act, 1976 (21 of1976), or the Export Credit and Guarantee Corporation Limited or the Industrial Reconstruction Bank of India Limited, the National Housing Bank established under Section 4 of the National Housing Bank Act, 1978 or an air transport service, or a banking or an insurance company, a mine, an oil field, a Cantonment Board, or a major port, the Central Government; and (ii) ………….”. By referring to this definition, learned Counsel for the petitioner submitted that “appropriate Government” under the provisions of Section 2, clause (a), sub-clause (i) is the appropriate Government as defined under the Industrial Disputes Act and by referring to the said definition, learned Counsel for the petitioner submitted that in respect of the industries mentioned under the provisions of Section 2, clause (a) of the I.D. Act are the only industries, for which the Central Government is the appropriate Government and in respect of other industries, it is the State Government. In this regard, learned Counsel for the petitioner relied on a judgment in Bijay Cotton Mills Limited v Its Workmen and Another and submitted that, in the absence of any notification under Section 2(a)(i) of the Industrial Disputes Act making the Central Government the appropriate Government in relation to industrial disputes concerning textile industry, the appropriate Government would be the State Government within whose territories the Textile mill is situated. Referring to the definition of 'appropriate Government’ under the I.D. Act and referring to the said judgment, learned Counsel for the petitioner submitted that, unless there is a notification under Section 2, clause (a), sub-clause (i) of the I.D. Act, declaring that the industry as carried on by or under the authority of the Central Government or specified in this behalf no other industries are covered and for all other industries, it is only the State Government is the appropriate Government and not the Central Government. He submitted that, there is no notification issued in this behalf showing that the Central Government is the appropriate authority for the 6th respondent. 7. He also relied on another decision of the Apex Court in Hindustan Aeronautics Limited v Their Workmen and Others and pointed out that, by amendments made from time to time in the definition of “appropriate Government” in Section 2, clause (a), sub-clause (i) of the Act, the statutory Corporations and Companies have been included in the definition, and only those industries falling in the definition are alone covered and the Central Government is the appropriate Government. Even if the shares are exclusively owned by the Central Government, such industries will not come under the purview of Central Government. Even if the shares are exclusively owned by the Central Government, such industries will not come under the purview of Central Government. He also submitted that, since the 6th respondent is not notified under the definition of Section 2(a), sub-clause (i) of the I.D. Act, the Central Government cannot be treated as the appropriate Government for the purpose of the CLRA Act. He also strongly relied on the decision in Steel Authority of India Limited's case and submitted that the 6th respondent though is the State within the meaning of Article 12, that by itself cannot be held as a factor to decide the Central Government is appropriate Government. It is also submitted that, to hold the Central Government as an appropriate Government in relation to the establishment, the Court must be satisfied that, the particular industry in question is carried on by or under the authority of the Central Government and in this aspect, what is required to be considered is, whether the 6th respondent-industry is really carried on or is under the authority of the Central Government and without the same is decided, it cannot be said that the Central Government is the appropriate Government for the purpose of CLRA Act. He also submitted that, holding of all of its shares by the President of India and the Government officials are posted, does not make any difference unless it is proved that the said industry is carried on or is under the authority of the Central Government. He further submitted that the 6th respondent is an industry run by Company and even though the shares are held by the Central Government that by itself does not decide that the industry is carried on by Central Government, unless it is proved that, the Central Government has carried on the industry or is under the authority of the Central Government, it would not be treated as an appropriate Government for the purpose of CLRA Act or the J.D. Act. 8. 8. Sri Aravind Kumar, learned Assistant Solicitor General appearing for the Union submitted that, this matter has been set at rest by virtue of a judgment in Hindustan Aeronautics Limited and Another v Hindustan Aero Canteen Karmikara Sangha and Others1 and pointed out that, the Apex Court considering the decision of Steel Authority of India Limited's case, has held that the Hindustan Aeronautics Limited is an undertaking of the Central Government and it is the Central Government which exercises full control over the same and the Central Government is the appropriate Government for the purpose of Hindustan Aeronautics Limited. Relying on this judgment, Sri Aravind Kumar submitted that, as far as H.A.L. is concerned, the question has been settled by the Apex Court by giving a finding that the said industry is Central Government Undertaking and fully under the control of the Central Government. He also pointed out from the judgment of Steel Authority of India Limited by referring to paras 39 and 119 that, the question as to whether the Central Government is an appropriate authority or not, is the question of fact, which has to be decided based on the evidence. He further submitted that the appropriate Government in relation to the establishment, the Court must satisfy itself that the industry is carried on by or under the authority of the Central Government and if this aspect is kept in mind, it would be clear that the Central Government will the appropriate authority under the CLRA Act and J.D. Act. In this regard, he referred to the judgment of Hindustan Aeronautics Limited's case, wherein the Apex Court has given a finding that the 6th respondent is fully under the control of the Central Government and the Central Government is the appropriate authority. He also submitted that, what is required to be considered is, as to whether the Government company/undertaking concern or any undertaking concern is carried on by or under the authority of the Central Government. He further submitted that, if the industry is controlled by the Central Government or carried on by the Central Government or if it is specified as controlled industry, for such industry, the Central Government is the only appropriate Government and not the State Government. He further submitted that, if the industry is controlled by the Central Government or carried on by the Central Government or if it is specified as controlled industry, for such industry, the Central Government is the only appropriate Government and not the State Government. He also submitted that there is no need to go into the question as to whether the 6th respondent-H.A.L. is controlled by the Central Government or not, as the said issue is now settled by the Apex Court by virtue of the judgment referred to above. He further submitted that in view of the fact that, the appropriate Government has not given licence to the petitioner, the petitioner has violated the provisions of CLRA Act and Rules made thereunder and prosecution is rightly initiated against the petitioner and further submitted that there is no need to interfere with the proceedings pending on the file of the learned Magistrate. 9. The offence alleged in this case is for violation of the provisions of the CLRA Act, for not taking licence from the appropriate Government. “Appropriate Government” has been defined under Section 2, sub-section (1), clause (a) of the CLRA Act. By reading of the said definition, it is clear that, in relation to an establishment in respect of which the appropriate Government under the Industrial Disputes Act, is the appropriate Government. From the reading of the definition of appropriate Government under the I.D. Act, it is clear that industry carried on by or under the authority of the Central Government would fall within the ambit of Central Government and industries, which are specified in this behalf also fall within the ambit of Central Government apart from the Railway Companies. The question is, whether the 6th respondent has been specified in this behalf or not, or whether it is controlled or carried on by the Central Government? 10. As far as this aspect is concerned, in Steel Authority of India Limited's case, the Apex Court in para 39 has held, that instrumentality or agency of Central Government would not by itself amount to having an authority of the Central Government to carry on that particular industry. Therefore, it is required to be considered, as to whether the particular industry in question is carried on by or under the authority of the Central Government? Therefore, it is required to be considered, as to whether the particular industry in question is carried on by or under the authority of the Central Government? This matter holding of all the shares of the said industry or the Company by the Central Government would not make any difference, unless a finding is arrived as to the 6th respondent is controlled or carried on by the Central Government or is a specified industry as under the definition of “appropriate Government” under Section 2, clause (a), sub-clause (i) of the I.D. Act. It is in this regard, it is useful to refer to the decision of the Apex Court in the matter. of Hindustan Aeronautics Limited, itself wherein a finding has been given by the Apex Court inter alia holding that the 6th respondent is an industry controlled by the Central Government. At para 2 of the said judgment, it is observed by the Supreme Court, which reads as under: “It is undisputed that the H.A.L. is an undertaking of the Central Government and it is the Central Government which exercises full control over the same. Issuance of licence by the State is not criteria, State Government would be the appropriate Government”. By the judgment of the Apex Court, it is clear that the 6th respondent is an industry, which is controlled by the Central Government and the Central Government is only the appropriate authority in respect of 6th respondent. 11. Learned Counsel for the petitioner submitted that in the case of Steel Authority of India Limited, it has been held that irrespective of wh-3ther the entire share capital was contributed by the Central Government and all the shares were held by the President of India and certain Officers of the Government are exercising power over the said industry will not decide the appropriate Government. He also submitted that in Steel Authority of India Limited’s case, it is held that the Central Government is not the appropriate authority in respect of the said industry. However, as far as 6th respondent is concerned, the issue has been settled by the decision of the Apex Court. The fact that it has been already held by the Apex Court that it is fully controlled by the Central Government, the Central Government is the only appropriate authority for the purpose of CLRA Act as well as I.D. Act in respect of 6th respondent. 12. The fact that it has been already held by the Apex Court that it is fully controlled by the Central Government, the Central Government is the only appropriate authority for the purpose of CLRA Act as well as I.D. Act in respect of 6th respondent. 12. The contention of the petitioner that the 6th respondent has not been notified as an industry carried on or under the authority of Central Government is concerned, the Apex Court has held that the 6th respondent is controlled by the Central Government. Hence, it is the Central Government is the appropriate Government. Even if the licence is obtained from the State Government, it will not be a valid licence for engaging the contract labourer under the provisions of CLRA Act and violation of the provisions of the said Act invites the prosecution, and in these cases, the learned Magistrate has taken cognizance and the only question that is raised in these writ petitions is that, the appropriate Government is the State Government and not the Central Government. In view of the decision in respect of very industry by the Apex Court, this question does not survive for consideration. Hence, I find no reason to interfere with the prosecution initiated against the petitioner. Accordingly, the writ petitions fail and same are dismissed.