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2007 DIGILAW 1805 (PNJ)

State Of Haryana v. Neel Kanth

2007-10-08

ADARSH KUMAR GOEL, RAJESH BINDAL

body2007
Judgment Adarsh Kumar Goel, J. 1. This petition has been filed by the State of Haryana against the award of the Labour Court dated 17.2.2006, Annexure P. 1, reinstating respondent No. 1 with continuity of service and full back wages. 2. Claim of the workman was that he worked as Operator in Water Treatment Plant in Public Health Department of the Haryana Government from 1.4.2000 to 1.3.2004. His services were terminated without any notice or retrenchment compensation by way of unfair labour practice. He was wrongly shown as working under a contractor who had no licence. 3. Stand of the petitioner was that the workman was employed, by contractor, respondent No. 3 to whom contract of manning of Treatment Plant was given. The Labour Court upheld the claim of the workman, holding as under :- (i) The workman worked under the supervision of the petitioner from July 1999 to February, 2001 and his services could not be transferred to the contractor and have to be treated to be continuing with the petitioner upto 28.2.2004. (ii) The contractor company had already been wound up and was non-existent during the period of contract and thus, the contractor was a mere camouflage. Reliance was placed on judgment of the Honble Supreme Court in Secretary Haryana State Electricity Board v. Suresh and others, 1999(21) RSJ 310. In these circumstances, the workman was entitled to be treated to be employee of the principal employer. (iii) There was violation of Section 25-f of the Industrial Disputes Act, 1947 (in short, `the Act). 4. Learned counsel for the petitioner submitted that the finding recorded by the Labour Court in the Contract Labour System was camouflage, is perverse, in view of there being a written contract after floating tenders for the work in question. Reference was made to documents annexed with the petition with regard to the grant of contract. 4. Learned counsel for the petitioner submitted that the finding recorded by the Labour Court in the Contract Labour System was camouflage, is perverse, in view of there being a written contract after floating tenders for the work in question. Reference was made to documents annexed with the petition with regard to the grant of contract. He also submitted that even though order of winding up had been passed, the contractor continued to supply labour to the Government and even if the contractor did not have a licence, this did not make the employees of the contractors to be employees of the principal employer, in view of law laid down by the Honble Supreme Court in Dina Nath and others v. National Fertilizers Limited and others, 1992(2) SCT 63 (SC) and judgment of this Court in M/s. T.T. Public School v. The Presiding Officer and another, 2006(1) SCT 701 (P&H). Learned counsel for the workman supported the findings in the impugned award. The questions for consideration are :- (i) Whether the workman could be held to be employee of the principal employer ? (ii) Whether the workman was entitled to reinstatement with back wages ? Re : (i) 5. The issue whether an employee was infact an employee of the principal employer and instrumentality of contractors was a sham transaction as also the issue whether on abolition of contract labour, an employee, becomes direct employee of the principal employer, has been subject matter of several decisions. 6. A Constitution Bench of the Honble Supreme Court in Steel Authority of India Ltd. v. National Union Water Front Workers, AIR 2001 SC 3527 examined the issue after referring to the earlier case law on the point. Reversing the view to the contrary, in Air India Statutory Corporation v. United Labour Union, AIR 1997 SC 645, it was held that on abolition of contract labour, the employees will not get automatically absorbed as employees of the principal employer. 7. The matter was again considered by the Honble Supreme Court in Workmen of Nilgiri Co-op. Mkt. Society Ltd. v. State of T.N., AIR 2004 SC 1639, in the context of the contention that engagement of contractor may be a camouflage. The question posed was whether the contract was "of service" or "for service". In para 32, it was observed : "DETERMINATION OF RELATIONSHIP : 32. Mkt. Society Ltd. v. State of T.N., AIR 2004 SC 1639, in the context of the contention that engagement of contractor may be a camouflage. The question posed was whether the contract was "of service" or "for service". In para 32, it was observed : "DETERMINATION OF RELATIONSHIP : 32. Determination of the vexed questions as to whether a contract is a contract of service or contract for service and whether the concerned employees are employees of the contractors has never been an easy task. No decision of this Court has laid down any hard and fast rule nor it is possible to do so. The question in each case has to be answered having regard to the fact involved therein. No single test be it control test, be it Organisation or any other test has been held to be the determinative factor for determining the jural relationship of employer and employee." 8. In Indian Drugs and Pharmaceuticals Limited v. Workmen, (2007)1 SCC 408, the issue of status of an employee recruited without proper procedure in public employment, was considered and after referring to judgments of the Honble Supreme Court, inter alia, in State of Karnataka v. Umadevi (3), 2006(4) SCC 1, it was observed that an employee recruited as a daily rated or ad hoc or casual employee, could not be regularised in service and thus, could not become regular employee of the Government. 9. In Municipal Council, Samrala v. Raj Kumar, (2006)3 SCC 81, in para 11, it was observed that employees of a Municipal council have to be recruited as per statutory provisions by making offer of appointment by competent authority in accordance with the statute. In State of U.P. v. Neeraj Awasthi, (2006) 1 SCC 667, it was observed that only such employees as are recruited as per rules can be treated as government employees. 10. In U.P. Power Corporation Limited and another v. Bijli Mazdoor Sangh and others (2007)5 SCC 755 , it was observed in para 6 :- "6. It is true as contended by learned counsel for the respondent that the question as regards the effect of the industrial adjudicators powers was not directly in issue in Umadevi (3) case (supra). But the foundational logic in Umadevi (3) case (supra) is based on article 14 of the Constitution of India. It is true as contended by learned counsel for the respondent that the question as regards the effect of the industrial adjudicators powers was not directly in issue in Umadevi (3) case (supra). But the foundational logic in Umadevi (3) case (supra) is based on article 14 of the Constitution of India. Though the industrial adjudicator can vary the terms of the contract of the employment, it cannot do something which is violative of Article 14. If the case is one which is covered by the concept of regularisation, the same cannot be viewed differently." In view of above, it cannot be held that the workman acquired status of employee of the petitioner-Government. Re : (ii) 11. It is also well-settled that unless an employee is recruited in accordance with the rules and regulations, a casual employee or an ad hoc employee cannot claim protection of Section 25-F of the Act in relation to public employment. Reference may be made to judgments of Honble Supreme Court in Raj Kumar, Neeraj Awasthi (supra) and Reserve Bank or India v. Gopinath Sharma, (2006)6 SCC 221. For the above reasons, we allow this petition and quash the impugned award. We make it clear that the petitioner will comply with the provisions of Section 17-B of the Act for the period during which the petition remained pending, within three months from the date of receipt of a copy of this order. Petition allowed.