Abad Dairy Dudh Vitran Kendra Sanchalak Mandal v. Abad Dairy
2017-12-22
K.M.THAKER
body2017
DigiLaw.ai
JUDGMENT : In captioned two petitions award dated 22.1.1992 passed by learned Industrial Tribunal in Reference (IT) No. 684 of 1989 is placed under challenge. The learned Tribunal, vide impugned award, dismissed the Reference (IT) No. 684 of 1989 on the principal ground that the claimants cannot be termed employees of the opponent Aabad Dairy (hereinafter referred to as the “Dairy” which term, for sake of brevity and convenience, shall include Municipal Corporation and G.D.D.C.) and that consequently Tribunal would not have jurisdiction to adjudicate the demand and to decide the reference. 1.1 Before proceeding further it is necessary to note, at the outset, that the dairy and its industrial establishment as well as its activities are closed since many years. Actually, the assets of the opponent dairy have been disposed of pursuant to the orders passed by Board of Industrial and Finance Reconstruction (“BIFR” for short) and the creditors have been paid their dues out of sale proceeds of the assets. Thus, neither any activity is being undertaken nor the establishment itself is in existence. It is equally relevant to mention that the system of engaging “booth operators” for milk distribution was discontinued even before the establishment actually came to be closed down pursuant to the permission granted by the specified authority under Section 25(o)(1) of Industrial Disputes Act, 1947 (hereinafter referred to as the “I.D. Act”). 1.2 First petition i.e. Special Civil Application No. 2795 of 1993 is filed by the claimants/union which sponsored the dispute and demand of the concerned claimants (hereinafter referred to as “booth operators” or the “claimants”) whereas second petition i.e. Special Civil Application No. 6497 of 1993 is filed by an individual booth operator who is aggrieved by the same award. It appears that the said individual petitioner had raised dispute which was referred for adjudication in Reference (IT) No. 121 of 1974 (New No. 200 of 1982). The learned Labour Court rejected the reference vide award dated 17.2.1993. The said award dated 17.2.1993 is placed under challenge by said individual petitioner in Special Civil Application No. 6497 of 1993. The said individual booth operator has stated that his petition may be heard and decided along with Special Civil Application No. 2795 of 1993.
The learned Labour Court rejected the reference vide award dated 17.2.1993. The said award dated 17.2.1993 is placed under challenge by said individual petitioner in Special Civil Application No. 6497 of 1993. The said individual booth operator has stated that his petition may be heard and decided along with Special Civil Application No. 2795 of 1993. Actually in the said Special Civil Application No. 6497 of 1993 individual petitioner has adopted the narration of facts as well as the grounds in Special Civil Application No. 2795 of 1993. In this view of the matter both the petitions are decided by this common decision. 2. So as to appreciate principal grievance of the booth operators against the conclusion and decision of the learned Tribunal, it is necessary to take into account the factual backdrop which gave rise to the dispute and the controversy between the parties and challenge against the award. 2.1 The respondent dairy was established and run by the Municipal Corporation of Ahmedabad. It is claimed that the Municipal Corporation decided to supply good quality of milk within the territory of municipal corporation and for that purpose the corporation established opponent dairy. Establishing and/or running and managing dairy and/or selling milk are not primary or statutory or principal or essential duty and function of dairy. It is also claimed that the dairy decided to sell milk by engaging persons on payment of commission. The dairy claimed that it had engaged “agents” or “independent contractors” (hereinafter referred to as “the claimants” or “the booth operators”) to sell milk at milk booths in different localities within the limits of the corporation and for that purpose the dairy had set-up several milk distribution centers (booths) in different localities. According to the arrangement the dairy delivered milk from its establishment to said distribution centers (booths) and the persons engaged for distribution of milk (booth operators) sold the milk at the said milk distribution centers (booths). Having regard to the convenience of the consumers milk was sold twice – a – day (i.e. in early morning and in the evening). The said booth operators were paid commission at the rate agreed upon between the dairy and the booth operators. This arrangement was formalized by virtue of agreements executed between the dairy and the booth operators. The said agreement prescribed the terms and conditions and thereby governed their relations.
The said booth operators were paid commission at the rate agreed upon between the dairy and the booth operators. This arrangement was formalized by virtue of agreements executed between the dairy and the booth operators. The said agreement prescribed the terms and conditions and thereby governed their relations. 2.2 At this stage it is relevant and appropriate to also note that the municipal corporation continued the said activities for sometime however somewhere in December, 1979 the municipal corporation transferred the dairy to the Gujarat Dairy Development Corporation (hereinafter referred to as the “Board”). 2.3 At that stage the Board also took over the same arrangement for selling milk (i.e. by engaging “booth operators” on commission basis) and the Board continued the booth operators who were working as such at the time of transfer of the dairy. Consequently the booth operators continued to work with the board. 2.4 After the board took over the dairy in 1979, the claimants, through their union, raised various demands (about 10 demands) and submitted charter of demand dated 19.7.1984. Any settlement with regard to the said demand could not be arrived at between the board and the claimants/union. The said refusal gave birth to dispute between the claimants and the dairy. 2.5 Appropriate government refused to refer the demands for adjudication. The claimants/union challenged the said decision of appropriate government by filing writ petition in the High Court. Hon’ble Division Bench held that the claimants (booth operators) cannot be termed employee/workman. In view of said conclusion High Court confirmed the decision by appropriate government. Therefore matter was carried before Hon’ble Apex Court. Hon’ble Apex Court partly allowed the Special Leave Petition and directed appropriate government to refer the demand/dispute for adjudication. Consequently appropriate government passed the order of reference dated 27.9.1989 whereby demands raised by the claimants/union came to be referred for adjudication. 2.6 At this stage it is important and necessary to mention that vide its charter demand dated 9.7.1984 the claimants/union had, actually raised 10 demands however during the proceedings the claimants/union dropped 7 demands and they declared and stipulated that they would pursue only 3 demands viz. demand Nos. 8, 9 and 10 mentioned in the charter of demand. It would be appropriate at this stage to take note of the said 3 demands. Learned Tribunal has reproduced said demands in the impugned award. They are:- “8.
demand Nos. 8, 9 and 10 mentioned in the charter of demand. It would be appropriate at this stage to take note of the said 3 demands. Learned Tribunal has reproduced said demands in the impugned award. They are:- “8. The heirs of the Milk Booth Operators should be appointed in case of their death or any other reason for ceasing as Milk Booth Operator. 9. The present rate of commission must be enhanced to the extent of Minimum wages and the grade of Rs.210-270 should be granted as is granted to the Dairy employees. In other cases, the commission of 0.10 paise on every Rs. 1/- sale must be given to the Milk Booth Operators. 10. Milk Booth Operators should be granted apart from commission all benefits like L, Gratuity, Bonus LTC, provident Fund, Casual Leave etc. as is being granted to the regular employees of the Dairy and the benefits in terms of money should be granted and paid to them for the benefits not granted to them till date” 2.7 Before proceeding further it is relevant to also note that (a) the dairy is discontinued and the dairy is closed and pursuant to the order passed by the BIFR all assets of the board are sold and now the board or dairy are not in existence and that therefore two demands viz. demand nos. 8 and 9 are virtually rendered infructuous and the said demands would not survive. So far as demand no. 10 is concerned it is relevant to note that in reply to the querry by the Court, the learned Counsel for the claimants/union clarified that the claimants (individually or through the union) have, until now, not raised claim for and have not initiated any proceedings for gratuity and/or bonus before the competent authority. Thus, for more than 25 to 30 years any proceedings before competent authority for gratuity and/or bonus have never been instituted by the claimants/union. Even during pendency of the subject reference No. 684/1989, the claimants/union did not institute/initiate any proceedings before the competent authority or Court or tribunal under Payment of Gratuity & Payment of Bonus Act. So far as the demand for privilege leave and/or casual leave and/or LTC are concerned, the claim for said benefits cannot survive since the dairy is closed.
Even during pendency of the subject reference No. 684/1989, the claimants/union did not institute/initiate any proceedings before the competent authority or Court or tribunal under Payment of Gratuity & Payment of Bonus Act. So far as the demand for privilege leave and/or casual leave and/or LTC are concerned, the claim for said benefits cannot survive since the dairy is closed. So far as provident fund is concerned, it is clarified by learned advocates for the union and the dairy that at the relevant time any dispute for benefit of provident fund (from the amount of commission paid to the Booth Operators) was never raised and at any point of time any deduction towards provident fund contribution (from the amount paid towards commission) were not made. The learned Senior Counsel for the dairy, on instructions submitted that P.F. Department had also not demanded compliance of the provisions under the Act. In this background the learned Senior Counsel for the claimants/union submitted that while it is true that on account of closure of the dairy coupled with the declaration that only 3 demands were pressed before the Tribunal the subject matter of the Reference (i.e. charter of demands) does not survive and the cause to pursue and prosecute the demands does not survive. 2.8 Despite this position the concerned claimants want to pursue and prosecute this petitions because now, after almost 30 years, the claimants want to raise new claim i.e. claim for closure compensation (which has never been raised by the claimants/union and until now any proceedings for such claim have not been initiated) and to raise new claim viz. closure compensation they want to pursue the submission that the claimants were the employees of the dairy. 2.9 Reverting to the factual backdrop, it may be noted that the claimants/union asserted before the Tribunal that they were employees of the dairy. Whereas, the dairy in its written statement, opposed the maintainability of the demand as well as reference on the ground that the booth operators were not its employees and relationship of employer and employee did not exist between the dairy and booth operators and the booth operators are “agent/s” or “contractor/s”. On such grounds dairy contended that the demand or dispute cannot be considered as industrial dispute and the reference would not be maintainable and learned Tribunal would not have jurisdiction to adjudicate the demand.
On such grounds dairy contended that the demand or dispute cannot be considered as industrial dispute and the reference would not be maintainable and learned Tribunal would not have jurisdiction to adjudicate the demand. 2.10 In light of the case made out by the contesting parties and in light of the evidence placed on record learned Tribunal appreciated the reference case under 28 heads. After considering the evidence placed on record by both sides and after dealing with rival contentions the learned Tribunal, reached to the conclusion that the booth operators/ claimants cannot be termed employees of the dairy and the relation between the dairy and booth operators is not of employer and employee and that the tribunal cannot adjudicate the demand/dispute between the said parties. On the said conclusion, learned Tribunal rejected the Reference. The said decision by the Tribunal is subject matter of and the reason for these petitions. 3. The principal objection against the impugned awards is that the learned Tribunal has committed material error in holding that the booth operators cannot be termed employees of the dairy and relationship of employer and employee did not exit between booth operators and the dairy. So as to assail the award and to support and justify their contentions including the contention that dairy exercised supervision and control over the booth operators, the learned Counsel for the claimants/union emphasized below mentioned aspects and features of their duties and their relationship with the dairy:- (a) Dairy had published advertisement inviting applications for allotting the booths. The dairy prescribed eligibility criteria e.g. requisite qualifications, age etc. and selection and appointment were made by the dairy after conducting interviews. Intimation about selection was issued by the dairy. (b) Dairy issued instructions and direction, through circulars and resolutions, related to and concerning the matters related sale of milk as well as price of milk; and (c) the dairy also imposed restrictions and restrained bulk sale e.g. sell to hotels, tea-stalls, restaurant, marriage functions etc; and (d) the dairy also decided the place/location for the booths and the operators were obliged to sell milk from the said milk booths; and (e) The dairy paid commission which, actually, was piece rate wage and the rate of commission was fixed by the dairy. (f) Employees of the dairy supervised the work of Booth Operators. (g) The Booth Operators were subjected to disciplinary action by the dairy.
(f) Employees of the dairy supervised the work of Booth Operators. (g) The Booth Operators were subjected to disciplinary action by the dairy. In case of breach of any instruction or breach of terms of the agreement or in case of breach of any direction issued vide any circular or rules, notices were issued by the dairy and disciplinary action such as suspension, fine and termination of contract were imposed by the dairy. (h) The customers were fixed by the dairy and Booth Operators were prohibited from selling milk to persons/customers other than the cardholders. (i) Dairy also provided the tools and equipments as well as complaint book in the milk booth/cabin (so that the customers can lodge complaint against Booth Operators) and fixed time for depositing sale proceeds. (j) Dairy employed full time regular/permanent employees in the category of salesman who performed duties similar to the duties of the Booth Operators and certain milk booths were run/operated by such employees (salesman). (k) Dairy also imposed restriction which restrained the Booth Operators from selling product of other dairy or to fix price or select the location/place for booth or decide the time to sell milk. 3.1 In light of and on the strength of above mentioned details the learned Counsel for the claimants/union would submit that the dairy exercised supervision and control and it also exercised power to select/appoint and terminate and pay the recommendation. Thus, all characteristic (required for establishing relationship of employer and employee) existed in the arrangement and that they fulfilled all criteria and characteristics of “employee” and the contention or defence of the dairy that they were not employees of the dairy but they were contractors or agents of the dairy, is incorrect and unjustified. 4. On the other hand, so as to support the claim and assertion that the claimants (Booth Operators) were not and cannot be termed employees of the dairy but the dairy was principal and the Booth Operators were its agents or contractors and their relationship came into existence and was governed by the terms of agreement, learned Senior Counsel for the dairy claimed and contended that:- (1) The relationship between the dairy and the booth operators came into existence by virtue of and were governed by the terms and conditions of the agreement which were consciously agreed upon and accepted by the booth operators.
(2) Agreements between the dairy and the Booth Operators were on principal and agent/contractor basis and the booth operators were independent contractors. (3) Element of service was absent in the agreement and in the relationship between the dairy and the Booth Operators. (4) That most of the booth operators were illiterate and the dairy had no post of “Booth Operator” on its sanctioned establishment. (5) That many booth operators did not personally operate the booths but they had either hired service of outsiders or they had engaged their relatives/other family members to operate the booth i.e. to sell the milk. (6) That most of the Booth Operators worked as such after they crossed age of superannuation prescribed by the dairy for its employees. According to dairy about 80 Booth Operators were of age above 60 years and about 18 Booth Operators were of age above 70 years and about 5 Booth Operators were of age above 75 years. (7) That the Booth Operators had executed agreements accepting the terms and conditions prescribed therein and they were also required to furnish surety/deposit. According to dairy its employees are not required to furnish surety and/or deposit and/or execute similar agreement. (8) That the possession of the milk booth remained with the Booth Operators and electricity bill had to be paid by the Booth Operators. (9) That the dairy did not exercise control over the booth operators and/or it did not supervise the manner in which they performed the work and that random supervision by dairy was of very limited nature and extent for ensuring and maintaining quality of milk, avoiding or arresting adulteration and arresting higher pricing (above MRP) and to ensure regular supply of milk to the residents of the locality. The time and place for sale of milk were fixed for the convenience of the residents of the locality and not with a view to fixing working hours/duty hours for the Booth Operators and the booth operators were free to close the booth immediately after entire quantity was sold and they were not obliged to sit in the booth even after the milk was sold and that the booth operators were free to make “home delivery” and were not bound by time restriction or control.
(10) The Booth Operators would submit indent/requisition for quantity of milk and dairy would supply/provide milk to each booth as per their indent/requisition and upon delivery of the quantity of indent/requisition milk, the milk would be property of the Booth Operators and the dairy had no obligation to take back/accept unsold milk. (11) Several Booth Operators were in employment with other establishment and the Booth Operators were free to carry on other business or other activities after they sold – off milk indented by them. (12) That the Booth Operators were not paid salary/wages but they were paid commission based on quantity sold by them and the amount of commission varied from booth to booth. There was no element/characteristic or features of “salary/wages” in the “commission” paid to the booth operators. Any deduction towards provident fund /ESI was not made from the amount paid towards commission. (13) Even co-operative societies acted as booth operator after executing agreement and several booths/milk centers were run operated by the co-operative societies. 5. I have considered rival submissions and the material available on record, the documents relied on by learned advocates as well as impugned award and the decisions on which learned advocates placed reliance. 5.1 As mentioned earlier, learned Tribunal has examined rival contentions by the contesting parties under 28 different heads. 5.2 Under the heading No. 1 learned tribunal has recapitulated and narrated the factual background of the order of reference made by the appropriate government. Whereas under heading No. 2 learned tribunal has summarized the details with reference to the demands raised by the claimants/union. More important is the fact that under said heading No. 2 learned tribunal has recorded the declaration and stipulation by the claimants/union that they drop all other demands and they intend to prosecute and pursue only three demands i.e. demand nos. 8, 9 and 10 and they drop other demands. Thereafter under heading no. 3 to 7 learned tribunal has summarized rival case of claimants and dairy and oral and documentary evidence and gist of rival submissions by contesting parties. Under heading no. 8 learned tribunal has briefly mentioned the nature and scope of three demands which the claimants desired to pursue issues required to be adjudicated in light of the case setup by the parties. Whereas, under heading no. 10 learned tribunal has recorded its decision against the plea raised on ground of financial difficulties.
Under heading no. 8 learned tribunal has briefly mentioned the nature and scope of three demands which the claimants desired to pursue issues required to be adjudicated in light of the case setup by the parties. Whereas, under heading no. 10 learned tribunal has recorded its decision against the plea raised on ground of financial difficulties. Thereafter under heading no. 12 learned tribunal has discussed about organization set-up, how the municipal corporation started the activity and that it is not substantial or primary activity of the municipal corporation and that the arrangement with the booth operator is contract for sale of milk. The learned tribunal has also discussed that nature and scope of the agreement executed by and between the dairy and the booth operators and that agreement were executed by certain credit-corporation societies and associations. The tribunal has also discussed evidence of the witnesses examined by both sides with reference to the agreement. Thereafter under heading no. 13 learned tribunal took into account the submission and evidence with regard to the advertisement which was issued to invite applications for engaging persons to run booth/sell milk and the tribunal also considered Section 54 of BPMC Act and the submission that persons were selected after interview. Having considered the evidence with reference to appointment of booth operators and after considering said submissions learned tribunal observed and held inter alia, that:- “The documents already referred to by me do not suggest that relationship will be that of employer – employee. It is not possible to agree that the appointment procedure establishes employer employee relationship between the parties.” and that “It is not possible to agree with the view that the entire procedure pertaining to appointment of a person to run milk centre on commission basis creates relationship of employer employee between the parties.” 5.3 With reference to heading no. 14 learned tribunal considered and dealt with the contention that the dairy selected and fixed the place for milk distribution centre (i.e. booth) and the booth operators were obliged to sell milk at the place selected and fixed by the dairy (i.e. at the booth) which amounted to control over the booth operators and that, in turn, established relationship of employer and employee.
In this context learned tribunal took into account the documents and evidence by the booth operators whereby the dairy, according to the claimants, issued instructions and also took action for not depositing sale proceeds or for not remaining present at the booth etc. On this count learned tribunal after considering rival submissions and evidence available on record observed, inter alia, that:- “It has come on record that, it is not that the booth operators have to sell the entire quantity of milk indented by them in the cabins provided by the first party” and that.... “It is an admitted fact that home delivery is permitted and home delivery is done. It is permitted under certain circulars.” and that “Hence, fixity of place for sale of milk by no stretch of imagination can be regarded as indication of creation of relationship of master and servant between the parties and that permitted to sell milk by giving home delivery and so the places where the home delivery is effected cannot be said to be the places fixed by the first party for sale of milk. 5.4 Under the heading No. 15 the learned tribunal considered and dealt with the contention by the claimants that the dairy prescribed the timings and they were obliged to work for 365 days in a year and their duties were fixed by the dairy and that if they failed to remain present at the time fixed by the dairy then they are subjected to action by the dairy. In this context learned tribunal took into consideration the terms and the conditions of the agreement, deposition of the witnesses examined by both sides and the submission that the timings were notified for convenience of consumers and not by way of duty hours for the claimants and that said arrangement was discontinued before many years i.e. after the dairy introduced bottles (and thereafter plastic pouch) and that therefore the need to sell milk at fixed time and/or at the booth did not survive. Moreover the booth operators also made home delivery. Thus, time factor was, even otherwise, flexible factor and had little relevance. 5.5 The learned Tribunal has also observed that home delivery was permitted and that therefore the instruction or concept about timings would have no relevance.
Moreover the booth operators also made home delivery. Thus, time factor was, even otherwise, flexible factor and had little relevance. 5.5 The learned Tribunal has also observed that home delivery was permitted and that therefore the instruction or concept about timings would have no relevance. After considering entire evidence on this point learned tribunal recorded the finding of fact that:- “Hence, if a cumulative effect is taken of all that has been discussed in this and other paragraphs pertaining to the topic under discussion it must be held that the relationship of mater and servant between the parties is not created by reason of the fact that the dairy has prescribed hours in the matter of taking delivery of the milk and for its sale and for crediting sale proceeds thereof either at the each points or in the bank.” 5.6 With reference to heading no. 16 i.e. the learned Tribunal dealt with the contention that the dairy supplied tools and instruments (measuring instruments) and that said fact established relationship of employer and employee. The learned Tribunal considered the evidence. Learned Tribunal also considered the fact that with introduction of bottles and thereafter plastic pouch, measuring instruments were not necessary. The learned Tribunal has also observed that the articles supplied by the dairy viz. wooden stool, cash box merely afforded facility to sit and keep sale proceeds and the Court then held that the instruments/tools supplied by the dairy were inconsequential and not of significance to establish relation of employer and employee. The Tribunal also noticed that milk was being sold in bottles and thereafter in pouch and that therefore even otherwise measuring instruments etc. had no relevance. In light of such factual position more particularly the fact that after introduction of bottles followed by pouch the need to supply measuring tools did not survive and it was discontinued since many years, learned tribunal held that it was not possible to hold that the said fact created relationship of master and servant. 5.7 Thereafter learned tribunal dealt with heading no. 17 i.e. contention on the ground that the dairy fixed price for sale of milk and the claimants had no right to sell milk at any other price and that the said fact established that the dairy was master of the claimants.
5.7 Thereafter learned tribunal dealt with heading no. 17 i.e. contention on the ground that the dairy fixed price for sale of milk and the claimants had no right to sell milk at any other price and that the said fact established that the dairy was master of the claimants. Learned tribunal has also dealt with the contention that the dairy withheld the commission for selling milk at price higher than the price fixed by the dairy. On this count learned tribunal considered, inter alia, oral and documentary evidence and agreement between the parties. The learned tribunal held that the practice of prescribing maximum sale price by the manufacturer is common feature and the learned Tribunal also took note of the fact that the dairy's right to fix the price was part of the agreement between the parties and by executing the agreement the booth operators had accepted the obligation to sell milk at the price fixed by the dairy and that therefore by any stretch of imagination the right to fix maximum sale price (being part of the contract) cannot be considered a factor or an ingredient which would create employer and employee relationship between the dairy and booth operators. 5.8 On this count it is relevant to take into account the fact that almost in all other consumer products such as toothpaste, powder, soap, bread etc. maximum sale price is always prescribed by the manufacturer and mentioned on the package of the product. On this count it is also relevant to take into account the case of fair price shop where the government fixes price for grains and other material sold on ration card by the fair price shop and fair price shop dealers are obliged to sell grains etc. to the cardholders, at the price fixed by the government. Since the booth operators emphasized certain arrangement instruction viz. that the dairy fixed price of milk and instructed them to not sell milk to hotel, restaurant, tea stall, it is relevant to take into account example of arrangement of fare price shop (ration shop) where the agent who are allotted permit to run ration shop and sell grains and other products supplied by government (Civil Supply Department) for distribution, at the price fixed by the government, to the cardholders. In that case grains etc.
In that case grains etc. are supplied by the government, the price and customers are also fixed by the government, the location/area for the shop is also fixed by the government, the area of operation/number of customers whom each shop would cater the service is also determined by the government. However the agents who run the grain shop are not considered government employee. Similarly example of petrol/diesel vending centres are also relevant. The agent who are alloted petrol vending centres are not considered employees of oil companies. 5.9 In this view of the matter when the learned tribunal, after considering all relevant aspects, reached to the conclusion and held that “parties are in the realm of contract of agency” the said conclusion does not deserve to be and cannot be faulted. 5.10 Thereafter, learned tribunal dealt with the heading No. 18 i.e. the contention of the claimants on the ground that the dairy fixed the customers and the booth operators were obliged to sale milk only to the customers fixed by the dairy. On this count learned tribunal took into account the terms in the agreement between the parties. Learned tribunal also took into account relevant documents and oral evidence by the booth operators as well as retired Deputy General Manager. After considering evidence by Hiraben (witness of booth operators) learned Tribunal has recorded that:- “She has admitted in paragraph 18 of her deposition that such cards were issued at a time when the dairy was managed by the Municipal Corporation. Then she made bold admission that the Gujarat Dairy Development Board has stopped practice of issuing cards. Therefore, this system is not at all in existence and consequently the requirement to sell milk only to card holders is also not in existence. Therefore, booth operators can sell milk to any genuine customer. She thereafter clarified that she has to sell milk on card only at the time when the milk is in short supply.…. milk can be sold only to those customers when it is in short supply which should mean that such prohibition is not required to be carried out by the booth operators when the milk is not in short supply.” 5.11 The learned Tribunal after appreciation of evidence, observed that:- “...
milk can be sold only to those customers when it is in short supply which should mean that such prohibition is not required to be carried out by the booth operators when the milk is not in short supply.” 5.11 The learned Tribunal after appreciation of evidence, observed that:- “... at present there is no card system and hence, no importance can be attached to the same and consequently this factor cannot be regarded as a factor to be taken into consideration along with other factors for deciding the vexed question of employer-employee relationship between the parties. There is no absolute prohibition against the sale of milk to the persons not holding the cards” and that “There is an admission of witnesses of the parties that at present card system is not inexistence and booth operators are free to sell milk to any person including the persons other than the card holders”. 5.12 In light of the material and evidence available on record and the admission by the witnesses learned tribunal found that said instruction was implemented very rarely and only at the time when the milk was in short supply. The learned Tribunal also considered further admission by the witnesses examined by the claimants/union viz. that the card system was discontinued by the dairy since many years and that card system is not in existence since many years and since very long time booth operators are free to sell of milk to any person. The instruction to sell milk only to cardholders was followed at the time of actual shortage of milk, meaning thereby the claimants relied on a measure which was outdated since many years and was not in operation since many years. The learned Tribunal observed, in light of evidence on record that:- “The persons running hotels, tea stalls, were in dire need of milk to keep rutting hotels and tea stalls” and that “it appears that they were prepared to pay more price for the milk and there are reasons to believe that the booth operators or some of were inclined to earn profit in the shape of difference of purchase price.” and that “Therefore, in order to check this and to see to the milk reaches the real consumers which was the objective for undertaking the milk project in question, the Ahmedabad Municipal Corporation forced to introduce card system.
It was then a measure for the time being. It was not an arrangement of permanent nature.” 5.13 Having considered above mentioned aspects learned tribunal concluded that in light of the material available on record it was not possible to conclude or hold that the said instruction created or intended to create relationship of master and employees. 5.14 Thereafter learned tribunal dealt with heading No. 19 i.e. contention that since dairy supplied stationary such as written slip, complaint book etc. the relationship of employer and employee was established. On this count learned tribunal took into account oral and documentary evidence including the provision under the agreement between the parties, copies of written slips etc. With regard to printed receipts supplied by the dairy to the booth operators, learned tribunal considered the evidence that the dairy delivered milk twice-a-day to the booth operators (according to the quantity indented by them) and that therefore the booth operators were obliged to submit signed receipts acknowledging delivery of milk according to the quantity indented by them and that it was only to facilitate the booth operators that the dairy supplied printed receipt so that the booth operators may not have to write relevant details while taking delivery of milk and repetitive process may be eliminated or substantially reduced. Learned tribunal held that on the ground that the dairy supplied printed written slips it cannot be concluded that the dairy's action of providing slips created employer employee relationship between the claimants and the dairy. The learned Tribunal further observed that it was nothing but facility given to the booth operators who otherwise would have been required as the dairy to pass such receipts on blank papers and then give separate intimations in writing everyday regarding the quantity of milk required on the next day.
The learned Tribunal further observed that it was nothing but facility given to the booth operators who otherwise would have been required as the dairy to pass such receipts on blank papers and then give separate intimations in writing everyday regarding the quantity of milk required on the next day. On this count learned tribunal, after considering evidence, has observed and recorded that:- “This is therefore, nothing but facility given to the booth operators who otherwise would have been required as the dairy to pass such receipts on blank papers and then given separate intimations in writing everyday regarding the quantity of milk required on the next day.” and that in the instant case, the act of the dairy in taking receipt in the printed prescribed form from the booth operators of their having received quantity of milk cannot be regarded as supply of stationery to them and consequently it cannot be urged from this aspect that thereby the booth operators have become employees of the dairy” and that “Hence, this aspect cannot be magnified by the second party as indicative of creation of employer employee relationship between the parties.” 5.15 Having dealt with above referred headings and contentions learned tribunal dealt with the heading No. 20 and the contention that the booth operators had to obtain permission to proceed on leave if he/she was not able to attend milk distribution on any particular day or for few days and that condition established supervision and control and thereby relationship of employer and employee. So far as said contention is concerned, learned tribunal considered and dealt with oral and documentary evidence. The witness on behalf of the claimants alleged that any leave or weekly off was not granted to them and they had to attend the work of milk distribution every day. They also claimed that they had to inform about their absence. The claimants however admitted that ordinarily their relative or family member/friend would work as proxy and fill-up their absence and that dairy accepted/allowed such arrangement. In this context, besides several other aspects, it is necessary to take into account the fact that the booth operators dealt with commodity of daily requirement for public and that therefore the said condition or requirement in the agreement cannot be termed as condition indicative of relationship of employer employee between the parties.
In this context, besides several other aspects, it is necessary to take into account the fact that the booth operators dealt with commodity of daily requirement for public and that therefore the said condition or requirement in the agreement cannot be termed as condition indicative of relationship of employer employee between the parties. Such instruction cannot be stretched to the extent of holding that the dairy exercised control over booth operators. Further, it is also relevant to note that the booth operators were not employees of dairy and that therefore they were not governed by and not subjected to leave Rules/Regulation (applicable to the employees of dairy) of the dairy and they were not governed by attendance regulations. In light of the evidence learned tribunal held that the booth operators failed to establish the characteristic or factors required for establishing relationship of employer and employee. 5.16 Thereafter learned tribunal dealt with the issue No. 21 and considered the contention that the dairy exercised right to bifurcate the booth into two booths whenever sale of milk at particular center exceeded particular quantity. On this count learned tribunal took into consideration documentary and oral evidence available on record by contesting parties. Learned tribunal took into account oral evidence available on record. While considering the evidence of the witnesses learned tribunal also took into account that Mr. Arvindbhai admitted that he was working as full time employee with a cooperative bank. Mr. Ishwarlal admitted that actually the booth operator engaged by the dairy was his sister but he was operating the booth. Mr. Champaklal admitted that his age was 76 years and he was working as booth operator. Mr. Navnitbhai also admitted that the sale of milk at the booth operated by him exceeded 300 liters however it was not bifurcated. Learned tribunal also took into account evidence by some booth operators who admitted that besides working as booth operators they worked as regular employee with other establishment. From the evidence, the learned Tribunal also found that in several cases bifurcation was not made.
Learned tribunal also took into account evidence by some booth operators who admitted that besides working as booth operators they worked as regular employee with other establishment. From the evidence, the learned Tribunal also found that in several cases bifurcation was not made. 5.17 Then learned Tribunal considered evidence by Nirmalaben and Veljibhai and while referring evidence by Veljibhai, Tribunal recorded that:- “He does not know about the bifurcation of the booth when the sale of milk exceeds 300 litres on a particular booth.” 5.18 Learned tribunal also took into account that ordinarily the dairy bifurcated/divided particular booth by taking into account convenience of customer/public so that customer may not have to wait in long queue because of concentration of large number of customers at particular center. Learned tribunal decided the contention by taking into account that a principal is at liberty and has right to appoint/start as may centres as he likes/needs and a principal would also be at liberty to specify area where the centres would operate. After considering evidence learned Tribunal recorded that:- “A principal is at liberty to appoint as many commission agents as he likes. He is also at liberty to specify the area where he likes. He is also at liberty to specify the area where they have to operate. He may also appoint more commission agents and re-specify the area. This will not mean that thereby the relationship of employer – employee is created between the principal and his commission agent.” and that “Therefore, I am not inclined to agree with the submission made by the second party that bifurcation of booth is a factor indicative of creation of relationship of employer – employee between the parties.” 5.19 So far the contention which learned Tribunal considered at heading No. 22 (with regard to unsold milk) is concerned learned tribunal dealt with the contention that the dairy took back unsold milk and the said factor established relationship of employer and employee. In this context learned tribunal took into account several documents including some correspondence between the union and the dairy. Learned tribunal also took into account evidence by booth operators.
In this context learned tribunal took into account several documents including some correspondence between the union and the dairy. Learned tribunal also took into account evidence by booth operators. On this count it is relevant to take into account undisputed fact that at the time when the dairy was run and managed by the corporation and before it was transferred to and taken over by the board, the dairy had stopped taking back unsold milk. The learned Tribunal took into account evidence by witness and observed that:- “However, in her cross-examination in paragraph 19 she has said that since 1972-73 dairy does not give credit of the milk which is returned, as remaining unsold and so he sells away that milk. Thus she admitted that since the year 1972-73 the dairy has stopped taking the unsold milk. She is true witness of the second party. Her this admission will go to show that the dairy is not taking back the unsold milk since the year 1972-73” 5.20 Even the witness/booth operators admitted that since 1970-72 the dairy was not accepting unsold milk. On conjoint reading of entire evidence it has emerged that the dairy was not responsible to take back unsold milk. Unsold milk in the hands of booth operators was taken back only in cases where there was complaint of curdling of milk. The learned tribunal also considered the fact that the responsibility to sell the quantity of milk (requisition by each booth operator) was of the booth operators and if any quantity remained unsold then the dairy had no obligation to take back unsold milk and that initially for some years dairy accepted unsold milk however since many years dairy had stopped accepting unsold milk and this procedure/decision were never opposed by the booth operators during past about 22 years.
Learned tribunal observed and that recorded the findings that:- “There is clear evidence and admission on record, by more than one witnesses, that since 1970-72 the dairy was not taking back unsold milk and that when the board took over the dairy in 1979, such procedure or practice or arrangement was not in operation.” and that “All these facts will clearly go to show that the milk once delivered becomes the property of the commission agent” 5.21 Thus, from detailed discussion by the learned tribunal on this count it has emerged that the claimants made attempt to rely on a fact or on a situation which was not in existence and was not in operation since many years. 5.22 So far as the issue No. 23 (with regard to Resignation) is concerned learned tribunal considered the claimants' contention that those booth operators who want to discontinue to work should give one month's notice established control of the dairy and thereby it also established relationship of employer and employee. In this context it is pertinent to note that the booth operators dealt with commodity of daily requirement of public and if the booth operators suddenly and without any intimation in advance quit the work and abruptly walk-out of the arrangement and thereby discontinue/disrupt operation of the booth then such action of booth operator would not only create difficulty for the dairy but would also cause hardship to the public as well and therefore the dairy would need time to make alternative arrangement. 5.23 Under heading No. 24 (about Identity Card) learned tribunal considered and dealt with the contention that the booth operators were instructed to keep the identity card while selling milk and that the said requirement established control of dairy and thereby it established relationship of employer and employee between the booth operators and the dairy. In this context learned tribunal took into consideration evidence by booth operators. The learned Tribunal took into account evidence of witness Mr. Mahendrabhai and recorded that:- “According to him there were some disturbances in the year 1969. At that time curfew was imposed, with the result that the booth operators were not in a position to go to their respective booths. Therefore, they had requested for issue of identity cards” and that “He has admitted that the request for giving identity card was made by the booth operators.
At that time curfew was imposed, with the result that the booth operators were not in a position to go to their respective booths. Therefore, they had requested for issue of identity cards” and that “He has admitted that the request for giving identity card was made by the booth operators. Such a request was made to the Asst. Manager.” 5.24 Learned tribunal has, on appreciation of evidence, observed that:- This was with a view to fix up the identity of a person receiving the commission and no eliminate even the remote possibility of making payment to a wrong person. The person giving payment can decide from the photograph on the identity card whether or not the person who has actually came to receive the commission is the same” 5.25 The said findings and observation emphasise the reason for introducing said system. Further, it is also pertinent that the I-Cards were not issued in discharge of statutory obligation (to issue I-Cards to the employees). After appreciation of evidence learned tribunal reached to the conclusion that the fact that the dairy issued identity card to booth operators and instructed to keep the Identity Card with them would not create or did not indicate relationship of employer and employee. 5.26 Then, while dealing with the point at heading No. 25 (about Commission) learned tribunal considered and dealt with the contention that payment of commission is, actually payment of wages on piece rate basis and that rate of commission is fixed by the dairy and that therefore payment of commission amounts to payment of wages and said payment established relationship of employer and employee. 5.27 On this count it is relevant to turn to the definition of the term “wages” under Section 2(rr) of the Industrial Disputes Act, 1947 which reads thus:- 2 (rr) " wages" means all remuneration capable of being expressed in terms of money, which would, if the terms of employment, expressed or implied, were fulfilled, be payable to a workman in respect of his employment or of work done in such employment, and includes - (i) to (iii)................. (iv) any commission payable on the promotion of sales or business or both;] but does not include-- (a) & (b).....
(iv) any commission payable on the promotion of sales or business or both;] but does not include-- (a) & (b)..... (c) any gratuity payable on the termination of his service;] 5.28 It is also relevant to note that according to the terms of contract/agreement in present case “commission” was paid to the booth operations to sell milk and not for “promotion” of sales or business or both” whereas according tot he definition of the term “wages” under Section 2(rr) only that category of “commission” which is paid for “promotion” of sales or business (i.e. the amount (commission) paid for increasing the sales of product or business or for expanding/promoting the business) is covered within the purview of Section 2(rr). In present case it is pertinent that even according to the case of the claimants they were not concerned with and their duty was not “increasing sales” or “expanding business” or “promoting sales or business” but their work was to merely sell the milk to the customers (and of promotion of sales). Further, in this context it is relevant to take into account the fact that the payment of commission was not subjected to any deduction, more particularly statutory deduction like P.F. or ESI. Thus, neither the dairy nor the claimants nor PF or ESI department treat said payment as wages and this system (i.e. not deducting P.F. or E.S.I) was not opposed by booth operators and even according to learned Senior Counsel for the Dairy the P.F. or E.S.I. department had not opposed this and did not cover the booth operators under said Act. The count learned Tribunal considered all aspects and held that : “it is not possible to hold that what is paid to the commission agent is piece rated wages. They are paid amounts by way of commission” 5.29 While addressing heading 26 (about demand for heirs) learned tribunal actually dealt with the demand no. 8 raised by the claimants whereby the claimants demanded that in case of death of booth operator, the booth should be allotted to heirs/legal representative. Having considered the contention and oral evidence learned tribunal observed and held that the dairy’s action of allotting the booth and modifying the contract do not establish or do not even indicate, employer and employee relation.
Having considered the contention and oral evidence learned tribunal observed and held that the dairy’s action of allotting the booth and modifying the contract do not establish or do not even indicate, employer and employee relation. Further in light of the fact that now the arrangement of selling milk does not exist and even the dairy itself does not exist, said demand no. 8 as well as the demand No. 9 and 10 do not survive. 5.30 At the headings No. 27 and 28 learned tribunal considered the contention about method of doing work and the contention on the ground that the dairy exercised control and supervision over the booth operators through its officers and issued instructions that they cannot sell milk on credit and bulk sale i.e. to hotel, restaurant, tea stalls etc. was not permitted and that they were directed to sell milk at fixed price and they were required to deposit the sale proceeds every day at the fixed cash point or banks prescribed by the dairy and in event of failure dairy would notices or place them under suspension or forfeit commission or in some cases terminate the contract. They claimed that said aspects established control and thereby relationship of employer and employee. The learned tribunal dealt with and considered oral evidence and the learned tribunal also took into account and dealt with various circulars and the agreement. Learned tribunal also considered the dairy's denial in respect of the allegations. The learned Tribunal also considered the dairy's claim that the officer – employee randomly visited the booths and such random visit were restricted only to ensure that there was no adulteration in the milk and that genuine customers were not deprived of milk on account of bulk sale of milk to hotels, tea stalls, restaurant etc. and such type of restriction or supervision in public interest cannot be construed as the factors which would establish control over booth operator and/or relationship of employer and employee. The learned Tribunal has also examined the case keeping in focus the principle that:- “Thus it is very clear that the control and supervision is not the decisive test. This is one of the factors to be taken into consideration.
The learned Tribunal has also examined the case keeping in focus the principle that:- “Thus it is very clear that the control and supervision is not the decisive test. This is one of the factors to be taken into consideration. Each case will have to be decided on its own facts and circumstances because the degree of control and supervision would not be same, but would vary.” 5.31 The learned tribunal also took into account the claim and the admission by the booth operators that many booths (which were originally allotted to some other persons) were being run by person other than authorized booth operators and in some cases authorized booth operators (e.g. family members/relatives etc.) had even engaged paid employees to run and operate the booth. After considering the evidence learned tribunal reached to the conclusion that the instruction were issued, for convenience of consumer and the instructions cannot be termed as instruction of such nature or such effect which could establish supervision or control by the dairy. The learned Tribunal has also held that the supervision was not carried out on day-to-day and regular and continuous basis and such supervision was not carried out in respect of the method and manner of work/performance by booth operators, but it was carried out once or twice in a month and constant supervision was not exercised by the dairy and that such random actions cannot be regarded as exercise of control and supervision by the dairy over the booth operators. 5.32 The learned tribunal has also observed that when the contract is suspended then during such period the booth operators actually do not earn any commission and that therefore it cannot be said that the dairy used to attach/forfeit the commission. The learned tribunal observed and held that:- “the instructions are given in public interest, with a view to prevent adulteration of the milk, and for use of duly stamped weights and measurement instrument........ The nature of the work is so simple that it does not warrant any supervision or control......The degree and manner of supervision does not render the agreement executed by the booth operators as contracts of service.
The nature of the work is so simple that it does not warrant any supervision or control......The degree and manner of supervision does not render the agreement executed by the booth operators as contracts of service. As a matter of fact the supervision and control to that extent will be present in all contracts of distributorship or agency or contract for service.” 5.33 In respect of the instances in which the dairy had taken action/s against the booth operator, learned tribunal has observed that the instances of the action or conduct of the claimants (for which the dairy allegedly took action against the claimants) amount to breach of the terms of the contract and the consequential action by the dairy would constitute or was in nature of action for breach of terms of contract. On appreciation of entire oral and documentary evidence learned Tribunal observed that:- “The documents do not pertain to control and supervision in regard to the mode and method of sale of milk. Therefore, the factor of control and supervision as is popularly understood is absent in this case and that “Therefore, it is not possible to hold from the oral and documentary evidence which are discussed in this and the other paragraphs that the dairy has been exercising effective control and supervision over the booth operators consequently it is not possible to hold that this aspect has brought about the employer relationship between the parties.” 5.34 In this context it is pertinent that in light of the agreement and surety bond executed and submitted by the claimants and in light of other evidence learned Tribunal held that the booth operators' conduct or action contrary to the terms and conditions of the contract would amount to breach of the contract and that such consequential actions by the dairy cannot be construed or treated or branded as “disciplinary actions by employer” or as “employer's action against employees” and that they do not establish and/or indicate that the booth operators were employees of the dairy and that the relation between the dairy and the claimants was of employer and employee. 6. In the end at issue No. 29 learned Tribunal has taken note of certain distinguishing features between booth operators and employees of the dairy and in light of said features learned Tribunal observed that the booth operators cannot be termed employees of the dairy.
6. In the end at issue No. 29 learned Tribunal has taken note of certain distinguishing features between booth operators and employees of the dairy and in light of said features learned Tribunal observed that the booth operators cannot be termed employees of the dairy. The distinguishing features can be summarized thus:- The booth operators were not bound by conduct, discipline and appeal Rules/standing order and/or leave Rules applicable to the Corporation and its employees and their engagement was governed only by the terms and conditions of the agreement executed by them and the surety bond. Whereas the employees of the corporation were governed by, subjected to and they had to abide by disciplinary and appeal Rules/standing order and leave Rules applicable to the Corporation and they were not required to execute any agreement or submit surety bond etc. While engaging the booth operators by executing contract with them, the prescribed procedure was not followed. They were not appointed under and in accordance with Section 54 of BPMC Act. The salesman/employees (i.e. regular and permanent employees) of the dairy were appointed by the corporation in accordance with the procedure prescribed for selection and recruitment. The booth operators had to enter into/execute contract. They had to also provide surety amount and they/the surety had to also execute/submit surety bond. No such condition/requirement for regular/permanent employees (including those in category of salesman). The booth operators used to engage other persons e.g. family member and some of them used to even engage/hire persons to sell milk. Whereas the salesman personally sold milk and they were not permitted to engage other persons to sell milk The unsold milk by the booth operators was not taken back. Whereas Dairy accepted/took back unsold milk from the permanent employees who attended booth and sold milk Whereas the both operators became owner of the milk (the title and right in the property got transferred to the booth operators on delivery of milk) and they sold milk as their property and part of his own business The salesman sold milk as dairy’s property and dairy's ownership i.e. on behalf of the dairy. The booth operators were not available for or at the disposal of the dairy after the milk was sold. Whereas the salesman/employee of the dairy would be at disposal of the dairy during entire time.
The booth operators were not available for or at the disposal of the dairy after the milk was sold. Whereas the salesman/employee of the dairy would be at disposal of the dairy during entire time. The booth operators had to pay electricity bill in respect of the booth allotted to them/operated by them. Whereas the electricity charge/bill of the booths operated by permanent employees was not paid by the employees but was paid by dairy. The booth operators were not transferable to other departments. Whereas the service of the salesman was transferable from one establishment to another or from one department to another. Only literate persons with prescribed educational qualification were appointed as salesman/employee. Whereas many booth operators were illiterate and had crossed maximum as limit (prescribed for selection) and many had even crossed age for superannuation. 6.1 After having considered and discussed entire oral and documentary evidence at length, the learned tribunal recorded below mentioned final conclusion:- “The cumulative effect of what has been discussed by me in the foregoing paragraphs of this judgment does not establish the employer employee relationship between the parties. Therefore, when there is no employer employee relationship between the parties the dispute between the parties cannot be regarded as industrial dispute and consequently the Industrial Disputes Act, 1947 would not be applicable” 6.2 Having reached to said conclusion learned tribunal held that the tribunal had no jurisdiction to adjudicate the demand and the reference. Consequently learned tribunal has dismissed the reference. 6.3 On reading and examining the impugned award it comes out that the tribunal has examined and dealt with oral and documentary evidence in respect of each topic and learned tribunal has passed exhaustive award after dealing with entire spectrum of voluminous oral as well as documentary evidence its effect and probative value and rival contentions raised by the contesting parties. 7. The claimants are aggrieved by the findings of fact and conclusions recorded by learned Tribunal and said findings are challenged by the petitioners – claimants. 7.1 In light of the findings of fact and conclusions recorded by learned tribunal the question which would arise before this Court is whether the findings recorded by the learned Labour Court are unreasonable or irrational or perverse which would warrant interference in exercise of supervisory jurisdiction and whether such findings and conclusion could not have been reached in light of the material available on record.
8. From forgoing discussion with reference to the evidence and rival contentions (which have been considered and decided by learned Tribunal) it has emerged that to claim that they were employees of the dairy the booth operators alleged existence or presence of the factors or indicia which are ordinarily taken into account for deciding as to whether relationship of employer and employee exist between the claimants and the opponent viz. (i) the selection, appointment and termination was done by dairy; and (ii) supervision and control; and (iii) payment of commission. 8.1 So as to support and justify their claim and contentions that their relationship with the dairy was of employer and employee, they placed heavy reliance on one factor viz. supervision and control. So as to demonstrate that the dairy exercised supervision and control over the booth operators, they emphasized the instances of visit/inspection by the officers of the dairy and the instances when dairy issued various instructions about price of milk, customers, timings, restriction on bulk sale and that earlier the dairy used to accept unsold milk. The second factor on which the booth operators relied is authority to select and appoint them and terminate the contract under which the booth operator came to be engaged. So as to support his submissions against the findings and the decision recorded by learned Tribunal, Mr. Mishra, learned advocate for the petitioner relied, inter alia, on the documents at exhibits 160, 130, 72, 75, 76, 81, 83, 87, 90, 92, 96 to 99, 162, 488, 489, 491, 114, 143, 511, 144, 514, 145, 481, 483, 476, 480, 161, 125, 132, 513, 525, 487, 477, 126, 112, 127, 128, 129, 147, 149, 516, 421, 542, 74, 153, 154, 111, 104, 113, 165, 499, 473, 116, 201, 91, 136, 194, 155 to 158 etc. Besides this, a compilation of various instances of notices/orders issued by the dairy (Exh. 542) is placed on record of the proceedings. The said statement reflects the details of the notices/orders said to have been issued by the diary against booth operators and the defaults/breach on account of which the notices/orders came to be issued are also mentioned in the said compilation. On such allegations and with said material it was contended that the dairy possessed and exercised powers and authority of employer and exercise of said authority established relation of employer and employee. Mr.
On such allegations and with said material it was contended that the dairy possessed and exercised powers and authority of employer and exercise of said authority established relation of employer and employee. Mr. Mishra, learned advocate for the petitioner also relied on the below mentioned decisions. 1. Dharangadhara Chemical Works, Ltd v. State of Suarastra 1957 (I) LLJ 477 2. Silver Jubilee Tailoring House vs. Chief Inspector of shops 1973 (II) LLJ 495 3. Madan Beedi Depot vs. The Industrial Tribunal 1974 (I) LLJ 436 4. D.C. Diwan Mohideen Sahib and sons vs. United Bidi Workers Union 1964 II LLJ 633 5. V.P. Gopala Rao vs. Public Prosecutor, Andra Pradesh, 1969 (18) SC 397 6. Bhagaband Collery vs. Their Workmen 1962 II LLJ 356 7. Hussainbhai vs. Alath Factory, 1978 (37) FLR 136 8. Management of Indian Bank vs. Presiding Officer, Industrial Tribunal, Madras, 1990 (1) LLJ 50 9. Indian Bank Association vs. Workmen of Syndicate Bank, 2201 (1) LLJ 1045. 9. The dairy, on the other hand claimed that it did not exercise either supervision or control and their relation came into existence by means of contract and the relation was governed by the terms of the contract and it acted in accordance with and within the boundary and frame work of the contract. On this count the dairy emphasized that most of the instructions or the instance of practice mentioned by the claimants, were introduced and followed and carried out for some period because of special requirement attached to the product or the activity; and also in light of the fact that the said procedure or practices were discontinued and abondoned since almost two decades, that too without any objection or protest at the relevant time or even thereafter i.e. even until the dairy raised preliminary objection in the reference proceedings; and they had undergone complete change since many years - rather before couple of decades - and such procedure/practice were discontinued since almost two decades, that too without any objection or protest by the booth operators and the procedure or instructions which were not in practice or not in existence since more than 20 to 25 years cannot be taken into consideration for determining the issue (viz. whether the claimants can be considered employees of dairy). So as to support the submissions Mr.
whether the claimants can be considered employees of dairy). So as to support the submissions Mr. K.M. Patel, learned Senior Counsel for the respondent relied on the documents at exhibits 614, 639, 637, 544, 201, 244, 355, 360 (with regard to submission that dairy did not take back any unsold milk except in case of complaint about curdling of milk) exhibits 60, 410, 309, 544, 554, 561, 565, 566, 569, 575, 584, 588, 622, 665, 662, 625, 626, [in support of the submission that the booth operators hired persons or used proxy (family member or another relative or hired persons) to sell milk and that many booth operators were regular/full time employee in other establishment] exhibits 592, 583, 582, 577, 570, 569 (to support the submission that many booth operators had crossed age fixed for superannuation under the rules of the dairy and they continued to work even at age of 70 years, 72 years, 80 years) exhibits 544, 16, 309 (to show that the card system was introduced and the said system lasted only during time when milk was in short supply) and exhibits 579, 592, 596, 599 (to support that even co-operative societies were also engaged as agent of the booth operators). Mr. K.M. Patel, learned Senior Counsel for the respondent also relied on the below mentioned decisions:- 1. Balwant Rai Saluja vs. AIR India Limited (2014) 9 SCC 407 2. Workmen of Nilgiri Coop. Mkt. Society Ltd. vs. State of T.N. and others (2004) 3 SCC 514 3. J. Sarabhai and co. vs. New Swadeshi Mills of Ahmedabad Limited 1966 Laws Suit (Guj) 1994 4. Nestle India Limited vs. Presiding Officer, Labour Court, Bhatinda 2002 (I) LLJ 367 5. Chandavarkar Sita Ratna Rao vs. Ashalata S. Guram, AIR 1987 SC 117 . 10. From the award it has emerged that while dealing with rival contentions (under hearing Nos. 1 to 28) the learned Tribunal has considered and exhaustively dealt with entire evidence and learned Tribunal has also recorded findings in respect of entire evidence and all contentions. After considering entire spectrum of oral and documentary evidence the learned Tribunal has not accepted the submissions that the dairy exercised such control and supervision which would establish that the dairy was the employer and booth operators were its employees.
After considering entire spectrum of oral and documentary evidence the learned Tribunal has not accepted the submissions that the dairy exercised such control and supervision which would establish that the dairy was the employer and booth operators were its employees. The learned Tribunal has also not accepted the submission that the payment of commission in accordance with the terms of contract was actually payment of wages by the employer to the employee and the said payment established relationship of employer and employee. The learned Tribunal also declined to hold that since the dairy selected and appointed booth operators and also exercised power to discontinue the contract/arrangement, the exercise of such power by the dairy makes the dairy their employer. The learned Tribunal has reached to the conclusion that the said notices/orders were issued by the dairy on account of breach of the terms of the contract e.g. selling adulterated or inferior quality of milk or breach of instructions. Learned tribunal has also considered and dealt with the circulars. Learned tribunal has held that by executing the agreement with the dairy the booth operators had consciously and voluntarily agreed to act as per the instructions which may be issued by the dairy. 11. So far as the contention based on the ground of supervision and control is concerned the booth operators relied on the instructions issued by the dairy. In this context it is pertinent that the relation between the booth operators and dairy was purely contractual and the said relation was governed by the terms and conditions which were mutually agreed and accepted by the both sides. The said contract between the dairy and the booth operators specified the terms and conditions which were mutually agreed upon. The provision in the contract (whereby the booth operators agreed to act as per the instruction which may be issued by the dairy) conferred power or authority to the dairy to issue instructions and the agreement, correspondingly, imposed obligation on the booth operators to act as per instructions. The said power and corresponding obligation flow from the contract. Therefore regard should also be had to other connected aspects and contention by the claimants cannot be accepted or rejected without considering other relevant aspects and features of contractual relation.
The said power and corresponding obligation flow from the contract. Therefore regard should also be had to other connected aspects and contention by the claimants cannot be accepted or rejected without considering other relevant aspects and features of contractual relation. 11.1 On this count it has emerged from the award that the learned Tribunal found from the evidence that almost all or most of the instructions or practice/procedure on which the claimants placed reliance were discontinued since about two decades before the date of dispute and were not in operation at the relevant time and they did not govern the relationship or even day to day activity at the relevant time. Having regard to such aspects and evidence the Tribunal declined to accept the instances mentioned by the claimants and also declined to hold that the dairy exercised supervision and control over the booth operators and that the dairy was the employer and they were employees. The learned Tribunal also considered that the instances on which the petitioners placed reliance were discarded/discontinued – without any objection or protest by the booth operators – since about two decades and that contemporaneous evidence established said aspect. The learned Tribunal also considered that the instructions which restricted bulk sale or the instruction with regard to sell to cardholders etc. were temporary feature and phenomenon which were introduced, for some time, in view of special and peculiar circumstances. 11.2 The learned Tribunal held that the procedure or practice (i.e. the instances cited by petitioner) which were not in existence for more then 20-25 years cannot be relied on or cannot be taken into account or made base for determining the issue viz. whether the booth operators can be termed employees of the dairy. Further, the documents on which the booth operators placed reliance and the instances which they cited (to support the submission that the dairy exercised supervision and control) do not lead to the conclusion that the dairy possessed and exercised complete administrative control. The decision by learned Tribunal is not wrong and that decision cannot be faulted. 11.3 The Tribunal could not have ignored or discarded contemporaneous practice/ procedure or modes and instructions, more so because they were in force since more than two decades whereas the instructions and instances on which booth operators placed reliance were discarded and discontinued before almost two decades.
11.3 The Tribunal could not have ignored or discarded contemporaneous practice/ procedure or modes and instructions, more so because they were in force since more than two decades whereas the instructions and instances on which booth operators placed reliance were discarded and discontinued before almost two decades. Thus, such discarded instructions and instances could not have been considered or relied on. Therefore, learned Tribunal rightly declined to accept and to rely on the instances which booth operators emphasized to establish that the dairy exercised control and supervision over booth operators and their work. The view and the decision taken by the learned tribunal on the said premise cannot be said to be arbitrary, incorrect or irrational. The conclusion by learned tribunal that by issuing instructions and by taking action for noncompliance of such instructions the dairy exercised control and that therefore dairy should be considered employer of the booth operators, cannot be faulted. 11.4 At this stage it is also relevant to note that actually control or supervision, to some extent, is always present in every arrangement. In that view of the matter what is required to be examined is exercise of complete administrative control and that therefore so as to establish relation of employer and employee the claimants must establish that the dairy possessed and exercised “complete administrative control”. In this context profitable reference may be had to the decision by Hon'ble Apex Court in case of Balwant Rai Saluja, wherein Hon'ble Apex Court observed that one of the important factors which should be taken into account for ascertaining as to whether direct relation of employer and employee exists between two party or not, is existence of “complete administrative control.” If the principal undertakes random or incidental supervision or issues some instructions related to work or activity of the business then, in absence of “effective and absolute control” or “complete administrative control” and in absence of regular and continuous supervision, the relation cannot be termed or construed as relation between employer and employee. After taking into account above discussed aspects and relevant evidence learned Tribunal reached to the conclusion that the said instances cannot be given so much weight-age that the decision about status of booth operators can be based on such instructions and instances of temporary duration. 11.5 The claimants also alleged that the actions taken by the dairy (against booth operators) were in nature of disciplinary action.
11.5 The claimants also alleged that the actions taken by the dairy (against booth operators) were in nature of disciplinary action. It is pertinent that the said contracts between the dairy and each booth operator specified the terms and conditions which were mutually agreed upon. Any action contrary to the terms of contract would amount to breach of the terms of contract and it would entail consequences in terms of the provision in the contract (i.e. as contemplated by the contract). Such consequential action for breach of terms of contract, coupled with absence of other relevant and necessary features and factors which may establish or indicate employer and employee relation, cannot be considered and treated as employer's disciplinary action. 12. Now so far as the contention based on the premise of selection and appointment is concerned learned advocate for the petitioners contended that entire process of selection and recruitment was initiated and conducted by the dairy. On this count it cannot be ignored or overlooked that in the case where a person is engaged as an agent or the cases where the contract is executed by a contractor on “job-contract” basis, principal may follow such procedure, more so in the cases where the principal intends to engage more than 1 agent for his purpose (e.g. sale of product). In such cases the principal would expect that the person (agent) should possess and fulfill particular qualifications or characteristics or standard which may be necessary for execution of the work. For that purpose the principal may notify certain qualifications. Therefore, the persons who came to be engaged as booth operators on the basis of the details mentioned in the Notice inviting application or screening of the applicants cannot claim that they should be considered employees of the dairy because the dairy had mentioned some criteria in the notice and some process of screening was also carried out more so when they had to execute contract and submit security deposit and undertaking/surety bond. Besides this in present case learned Tribunal has, after considering the evidence and the provisions under BPMC Act, also held that the booth operators were not engaged in accordance with applicable rules and provisions under the Act.
Besides this in present case learned Tribunal has, after considering the evidence and the provisions under BPMC Act, also held that the booth operators were not engaged in accordance with applicable rules and provisions under the Act. 12.1 Further, in present case the details mentioned in the notice inviting applications from the persons interested to work as booth operators can neither establish nor can it lead to the conclusion that the persons who came to be engaged as booth operators were engaged as employees or that the relation between the dairy and said persons was relation of employer and employees. 12.2 The terms and conditions of the contract which brought the relation in existence as well as the surety bond/the undertaking establish the distinguishing features between said two categories and such distinguishing factors could not have been ignored and the submissions based on the advertisement could not have been considered in isolation. The said aspects have been rightly examined in light of all attending and attached facts. It is relevant to note that if specific requirements (in respect of the work e.g. particular qualification or training or knowledge) in light of nature of the trade/work for which person is to be engaged is mentioned in the Notice inviting applications, it cannot be conclusive or sufficient to create or establish relation of employer and employee and it cannot lead to conclusion or inference that the person is engaged as employee. 12.3 This aspect is elaborately considered by Hon'ble Apex Court in case of West Bengal Registration Copywriters Association (supra) wherein certain peculiar and specific criteria and qualification were prescribed. One criterion prescribed that the applicant/ candidate should have good handwriting. Having considered the criteria prescribed by the government (for appointing copywriters) Hon'ble Apex Court held that merely because principal notifies particular requirement as necessary qualification, one cannot come to the conclusion that such specifications amount to exercising employer's right of appointing employee and the persons who are engaged after some screening, will not create relationship of employer and employee. Thus the reference to and submissions based on the Notice inviting applications does not support petitioners' claim.
Thus the reference to and submissions based on the Notice inviting applications does not support petitioners' claim. 12.4 On this count it is relevant to also note that in case of employment i.e. in the case where the relation is, undisputedly and admittedly, of employer and employee the employees have to follow and abide by the discipline and conduct rules applicable to the organization with which they work and there are several other restriction also which bind the employees e.g. restriction against other parallel employment (double employment) and age of superannuation and restriction in respect of maximum number of leave etc. However in present case it is established that the booth operators were not subjected to and they were not bound by the discipline and conduct rules of the dairy i.e. the Rules which were applicable and binding to the employees of the dairy and the said rules were not applicable to the booth operators. The said distinguishing fact cannot be ignored while deciding the claim about relation of employer and employee. 13. The learned Tribunal, has carefully and exhaustively considered all documents, entire evidence and all contentions. The findings recorded by learned Tribunal viz. the booth operators cannot be termed employees of the dairy and the relationship between the dairy and the booth operators was not of employer and employee are supported by cogent and satisfactory reasons which, in turn, are based on detail analysis and appreciation of entire – oral and documentary – evidence and final decision and verdict by the learned Tribunal are not and cannot be termed unjust and there is nothing on record to convince the Court that the findings and verdict are incorrect, arbitrary or contrary to evidence or perverse. 14. By any standard and by any yardstick the conclusion recorded by the learned tribunal is eminently possible view and it is duly supported by cogent and satisfactory reasons and relevant evidence available on record. 14.1 Merely because another view may be possible, the findings of fact and the conclusion recorded by learned tribunal – after appreciation of evidence cannot be dumped or disregarded or discarded and cannot be rendered worthless. 14.2 Even otherwise supervisory jurisdiction of this Court is limited and this Court, while exercising supervisory jurisdiction and in the process of judicial review of tribunal’s conclusion, would not act as Appellate Court.
14.2 Even otherwise supervisory jurisdiction of this Court is limited and this Court, while exercising supervisory jurisdiction and in the process of judicial review of tribunal’s conclusion, would not act as Appellate Court. Merely because another view may be possible this court will not disturb the conclusion and finding recorded by learned tribunal which are supported by cogent reasons which, in return, are backed by the evidence on record. 15. On this count it is relevant to take into account the decision in case of International Airport Authority of India vs. International Air Cargo Workers' Union (2009) 13 SCC 374 Hon'ble Apex Court observed that:- “47. It is true that in exercising the writ jurisdiction, the High Court cannot sit in appeal over the findings and award of the Industrial Tribunal and, therefore, cannot re-appreciate evidence. The findings of fact recorded by a fact, finding authority should ordinarily be considered as final. The findings of the Tribunal should not be interfered with in writ jurisdiction merely on the ground that the material on which the Tribunal had acted was insufficient or not credible. 48. It is also true that as long as the findings of fact are based on some materials which are relevant, findings may not be interfered with merely because another view is also possible. But where the Tribunal records findings on no evidence or irrelevant evidence, it is certainly open to the High Court to interfere with the award of the Industrial Tribunal. 49. In this case, the grounds on which the Union sought relief of absorption and the grounds on which the Tribunal ultimately granted relief are completely different. Having regard to the several decisions in the earlier rounds of litigation, which had attained finality, it is doubtful whether the Tribunal could have considered these issues at all. Even assuming that the Tribunal could have considered the said grounds as having risen for decision, the question is whether there was any basis or material for its finding and assumptions.
Having regard to the several decisions in the earlier rounds of litigation, which had attained finality, it is doubtful whether the Tribunal could have considered these issues at all. Even assuming that the Tribunal could have considered the said grounds as having risen for decision, the question is whether there was any basis or material for its finding and assumptions. Let us examine the findings.” 15.1 A profitable reference may also be had to the observations by the Apex Court in case of Chandavarkar Sita Ratna Rao vs. Ashalata S. Guram ( AIR 1987 SC 117 ) wherein Apex Court observed that:- 16......It is well settled that the High Court can set aside or ignore the findings of fact 0 an appropriate court if there was no evidence to justify such a cone fusion and if no reasonable person could possibly have come to the conclusion which the courts below have come or in other words a finding which was perverse in law. This principle is well settled. In D.N. Banerji v. P.R. Mukherjee, it was laid down by this Court that unless there was any grave miscarriage of justice or flagrant violation of lain, calling for intervention it was not for the High Court under Article, 226 and 227 of the Constitution to interfere. If there is evidence on record on which a finding can be arrived at and if the court has not misdirected itself either on law or on fact, then in exercise of the over under Article 226 or Article 227 of the Constitution, the High Court should refrain from interfering with such findings made by the appropriate authorities. 21. It is true that in exercise of jurisdiction under Article 227 of the Constitution the High Court could go into the question of facts or look into the evidence if justice so requires it, if there is any misdirection in law or a view of fact taken in the teeth of preponderance of evidence. But the High Court should decline to exercise its jurisdiction under Articles 226 and 227 of the Constitution to look into the fact in the absence of clear and cut down reasons where the question depends upon the appreciation of evidence.
But the High Court should decline to exercise its jurisdiction under Articles 226 and 227 of the Constitution to look into the fact in the absence of clear and cut down reasons where the question depends upon the appreciation of evidence. The High Court also should not interfere with a finding within the jurisdiction of the inferior tribunal except where the findings were perverse and not based on any material evidence or it resulted in manifest injustice. (See Trimbak Gangadhar Telang (supra). 15.2 It would not be out of place to also consider the decision in case of Steel Authority of India Ltd. v. Gujarat Mazdoor Panchayat [ 2004(1) GLR 729 ], wherein this Court observed, inter alia, that:- "32................ 7. The question about the limits of the jurisdiction of High Courts in issuing a writ of certiorari under Art. 226 has been frequently considered by this Court and the true legal position in that behalf is no longer in doubt. A writ of certiorari can be issued for correcting errors of jurisdiction committed by inferior courts or tribunals : these are cases where orders are passed by inferior courts or tribunals without jurisdiction, or is in excess of it, or as a result of failure to exercise jurisdiction. A writ can similarly be issued where in exercise of jurisdiction conferred on it, the Court or Tribunal acts illegally or improperly, as for instance, it decides a question without giving an opportunity to be heard to the party affected by the order, or where the procedure adopted in dealing with the dispute is opposed to principles of natural justice. There is, however, no doubt that the jurisdiction to issue a writ of certiorari is a supervisory jurisdiction and the Court exercising it is not entitled to act as an appellate Court. This limitation necessarily means that findings of fact reached by the inferior Court or Tribunal as result of the appreciation of evidence cannot be reopened or questioned in writ proceedings. An error of law which is apparent on the face of the record can be corrected by a writ, but not an error of fact, however grave it may appear to be.
An error of law which is apparent on the face of the record can be corrected by a writ, but not an error of fact, however grave it may appear to be. In regard to a finding of fact recorded by the Tribunal, a writ of certiorari can be issued if it is shown that in recording the said finding, the Tribunal had erroneously refused to admit admissible and material evidence, or had erroneously admitted inadmissible evidence which has influenced the impugned finding. Similarly, if a finding of fact is based on no evidence, that would be regarded as an error of law which can be corrected by a writ of certiorari. In dealing with this category of cases, however, we must always bear in mind that a finding of fact recorded by the Tribunal cannot be challenged in proceedings for a writ of certiorari on the ground that the relevant and material evidence adduced before the Tribunal was insufficient or inadequate to sustain the impugned finding. The adequacy or sufficiency of evidence led on a point and the inference of fact to be drawn from the said finding are within the exclusive jurisdiction of the Tribunal, and the said points cannot be agitated before a writ Court. It is within these limits that the jurisdiction conferred on the High Courts under Art. 226 to issue a writ of certiorari can be legitimately exercised (vide Hari Vishnu Kamath v. Ahmad Ishaque, 1955-1 SCR 1104 : ((S) AIR 1955 SC 233 ); Nagendra Nath v. Commr. of Hills Division, 1958 SCR 1240 : ( AIR 1958 SC 398 ) and Kaushalya Devi v. Bachittar Singh, AIR 1960 SC 1168 ." 33. The relevant observations made by the Supreme Court in the above quoted two decisions make it evident that a limited jurisdiction is available to High Courts while considering the question, whether a writ of certiorari, as claimed by the writ petitioner, can be issued. Under Article 226 of the Constitution, High Court will not interfere with weighing of evidence led before the Tribunal as if the High Court were sitting in appeal. A finding of fact cannot also be challenged on the ground that relevant materials and evidence adduced before the Tribunal was insufficient or inadequate to sustain the findings recorded by the Tribunal.
Under Article 226 of the Constitution, High Court will not interfere with weighing of evidence led before the Tribunal as if the High Court were sitting in appeal. A finding of fact cannot also be challenged on the ground that relevant materials and evidence adduced before the Tribunal was insufficient or inadequate to sustain the findings recorded by the Tribunal. The adequacy or sufficiency of evidence and the inferences to be drawn from the evidence are the exclusive domain of the Tribunal and the same cannot be agitated before the writ Court. ...... It is true that burden of proof to prove the fact rests upon a person who asserts existence of the same, and there is no manner of doubt that primary burden of proof to prove that the workmen concerned were employees of SAIL, was on the workmen. However, both by way of their claim statement and oral evidence, the workmen have established that they were never recruited by any of the contractors and were under control and supervision of SAIL. The Tribunal has considered the evidence led by the writ petitioner, and reached a conclusion in paragraph 13 of the impugned award that the concerned workmen were/are serving under the supervision, control and direction of SAIL. The best evidence that could have been produced, viz. employment record, could not be produced by the writ petitioner before the Tribunal. ..... Moreover, it is well settled that once the parties have led evidence understanding the nature of the case to be met, and the Court has recorded the findings on the basis of evidence led, the question of burden of proof becomes academic. As observed by the Supreme Court in Mohd. Shahnavaz Akhtar & Anr. v. IST ADJ, Varasani & Ors., (2002) 9 SCC 375 , jurisdiction under Article 226 of the Constitution does not include re-appreciation of evidence and on that basis dislodge the finding of fact recorded by the Tribunal. The findings which have been recorded by the Tribunal are such which could have been reasonably arrived at, properly thought out and logical. Under the circumstances, the findings recorded by the Tribunal and final conclusion based thereon are not liable to be interfered with in instant petition.” 15.3 Above quoted observations emphasise the boundary of this Court's jurisdiction while examining an award passed by the Tribunal in exercise of its adjudicatory jurisdiction and challenge against such award.
Under the circumstances, the findings recorded by the Tribunal and final conclusion based thereon are not liable to be interfered with in instant petition.” 15.3 Above quoted observations emphasise the boundary of this Court's jurisdiction while examining an award passed by the Tribunal in exercise of its adjudicatory jurisdiction and challenge against such award. Having regard to the fact that the award is neither erroneous nor perverse nor arbitrary and having regard to above quoted observations there is no justification to interfere with and disturb the award. 16. This is appropriate stage to consider the matter and the award from another perspective. 16.1 In view of the dairy's contention that the relation and arrangement between the dairy and booth operators is in nature of principal and agent or on principal and contractor basis, it is appropriate to mention at this stage that from foregoing discussion it has also emerged that the characteristic and features attached to the relationship and arrangement between the booth operators and the dairy are more in nature of and close to the authority and power of principal which he exercised against his agent and in his ordinary transaction and ordinary course of business they do not even indicate or suggest – much less demonstrate or establish – employer and employee relation and they are not even close to the characteristics and features attached to the relation of employer and employee. The features or the indicia or characteristics which have emerged from foregoing discussion indicate and establish relation and arrangement between principal and agent or principal and contractor. The line which distinguish the relation of principal and agent from the relation of employer and employee is, in most cases, very thin and in many cases elusive and there cannot be a thumb rule to treat or consider any act by principal as that of an employee or to treat an agent as employee inasmuch as a principal (who enters into contract with a person and engages that person as his agent) has right to select any person as agent who would be most suitable for his business and would fulfill his requirement and need and for that purpose he may fix and demand appropriate standards or criteria and particular qualification or aptitude and by applying those standards he may select most suitable person.
A principal also has the authority to instruct the agent to set-up premises at prominent location and/or to decide the place and location where the product should be displayed and sold and to issue instructions to his agent to establish the premises at particular location and not at some obscure location. A principal also has the authority to fix the price or rate of the product and instruct the agent to sell the product at the price fixed by him and not at any other price. A principal also has the right to insist that the agent may or should not engage sub-agent and should personally do the work/run the agency or to allow the agent to engage subagent. Likewise the principal can also undertake visits and check the place of business to ensure that the agent is not indifferent in keeping the premises open and clean so as to provide easy access and clean place to the customers at the time convenient to them. On the other hand an agent is obliged to act according to the instructions by the principal. Thus, merely by showing that the dairy issued certain instructions or it took actions for breach of such instructions the booth operators cannot claim that they conclusively established that they were employees of the dairy. 16.2 In this context it is relevant to note that depending on the nature of business/activity a principal also may issue similar instruction against his agent and so as to ensure that the business/activity is conducted as per his instruction and the principal would also oversee or supervise as to whether the agent follows and complies the instruction or not. Exercise of such power or authority by principal against the agent would automatically not convert the relation of principal and agent into relationship of employer and employee and on account of such actions by the dairy, the dairy cannot be termed employer of the booth operators. In light of the fact that even the principal may exercise right to select and appoint a person as agent however in absence of other factors, it will not make him an employer and will not make his agent, an employee. Likewise, on the premise that principal exercises right to issue instructions to the agent, it cannot be claimed that the said acts by principal amount to “employer's supervision and control over employee”.
Likewise, on the premise that principal exercises right to issue instructions to the agent, it cannot be claimed that the said acts by principal amount to “employer's supervision and control over employee”. Such acts would not convert relation of principal and agent into relation of employer and employee. Further, so as to establish that the relation is that of employer and employee and so as to hold that the relationship between the concerned two parties is that of employer and employee various aspects, in addition to or over and above “supervision and control” factor, should exist and existence of such other factors including “effective and absolute control” and “complete administrative control” over the claimant and his performance should be established. In this view of the matter the decision by learned Tribunal that the booth operators failed to establish that they were employees of the dairy, cannot be termed as incorrect or perverse. 16.3 In present case the agreement between the diary and booth operators (which brought into existence the relation between the dairy and the booth operators) governed the relation between them. The said contract also brings out the intention of the parties. In present case it is pertinent to note that one of the conditions (for appointment as a booth operator) obliged the applicant to deposit security amount and surety bond. Moreover the discipline, conduct and Appeal Rules of the dairy and/or the leave rules or provision with regard to age of superannuation etc. applicable to the employees of the dairy, were not applicable to the booth operators. Further, the evidence on record has brought out that there were several booth operators who continued to work as such even after they crossed age of superannuation prescribed under the rules of dairy. The said facts distinguish the status of booth operators from that of the employees of the dairy. When all aspects discussed above are put together and considered conjointly, and when they are examined in light of the guidelines and principles explained by the Apex Court, they establish and fortify that the booth operators cannot be termed employees of the dairy and the findings and conclusion by tribunal do not deserve to be disturbed. 17. It is pertinent to note that above mentioned aspects are also borne out from the provision under the Contract Act.
17. It is pertinent to note that above mentioned aspects are also borne out from the provision under the Contract Act. Section 182 to Section 213 under Contract Act statutorily recognizes and confers such power in the hands of principal which the principal can exercise in his dealings with and during his transactions with the agent. Therefore, at this stage it is necessary to consider said provisions under Contract Act. 17.1 Section 182 of the Act defines the terms “agent” and “principal” and section 185 of the Act prescribes that consideration is not necessary to create an “agency”. Section 186 of the Act provides that agency may be implied. Section 190 of the Act provides for circumstances in which agent cannot delegate acts which he has undertaken to perform personally. Section 201 deals with termination of the agency and section 207 provides that revocation of agency or renunciation of agency may be expressed or implied. Section 211 prescribes duty of agent in conducting business of the principal and said Section 211 recognizes that an agent is obliged to act as per the instructions of the principal and to statutorily acknowledge said feature of agency, whereas Section 213 provides that agent is bound to render account to the principal. The said provisions read thus:- “182. ‘Agent’ and ‘principal’ defined.—An ‘agent’ is a person employed to do any act for another, or to represent another in dealings with third person. The person for whom such act is done, or who is so represented, is called the ‘principal’......." 201. Termination of agency An agency is terminated by the principal revoking his authority, or by the agent renouncing the business of the agency; or by the business of the agency being completed; or by either the principal or agent dying or becoming of unsound mind; or by the principal being adjudicated an insolvent under the provisions of any Act for the time being in force for the relief of insolvent debtors. 207. Revocation and renunciation may be expressed or implied Revocation or renunciation may be expressed or may be implied in the conduct of that principal or agent respectively. 211. Agent's duty in conducting principal's business.
207. Revocation and renunciation may be expressed or implied Revocation or renunciation may be expressed or may be implied in the conduct of that principal or agent respectively. 211. Agent's duty in conducting principal's business. An agent is bound to conduct the business of his principal according to the directions given by the principal, or in the absence of any such directions according to the customs which prevails in doing business of the same kind at the place where the agent conducts such business. When the agent acts otherwise, if any loss be sustained, he must make it good to his principal and if any profit accrues, he must account for it. 213. Agent's accounts An agent is bound to render proper accounts to his principal on demand. 220. Agent not entitled to remuneration for business misconducted.- An agent who is guilty of misconduct in the business of agency, is not entitled to any remuneration in respect of that part of the business which he has misconducted.” 17.2 From conjoint reading of said provisions it comes out that in their relation and during their interactions and transactions a principal can always issue instructions (oral as well as written) or he can prescribe terms and conditions in the contract with regard to: (1) price of the product (2) rate of commission (3) period of credit and submission of accounts (4) principal can reserve right to engage more number of agents/contractors and expand area of operation (5) he can exercise right and authority to select and appoint agent/contractor suitable to his requirement (6) principal can also exercise right to give instruction related to business (7) and he can exercise right to recover the loss which occur on account of contractor's/agent's action or conduct. 17.3 Section 211 provides, inter alia, that the agent is bound to conduct the business of his principal according to direction given by the principal. The said Section, thus, acknowledges that the principal can issue instructions to the agent in the matters related to business and the agent is bound to follow such instruction.
17.3 Section 211 provides, inter alia, that the agent is bound to conduct the business of his principal according to direction given by the principal. The said Section, thus, acknowledges that the principal can issue instructions to the agent in the matters related to business and the agent is bound to follow such instruction. 17.4 Thus, on the ground that the dairy used to issue instructions with regard to matters related to the work/arrangement of the work for which claimants were engaged, neither it can be claimed nor it can be mechanically concluded that the dairy was employer or it acted as employer or it exercised power and authority of employer or that issuance of instructions to the booth operators created, or even indicated, relation of employer and employee. 17.5 Actually, the instructions issued by the dairy e.g. with regard to time, price, location, instruction to give advance intimation about leave, bifurcation of booths, identity card, cardholders rates of commission, instruction to sell milk to individual buyers and to not indulge in bulk sell and/or to deposit sale proceeds etc. fall within the purview of and they stand covered within purview of said Section 211 and/or Section 213 and/or Section 220 etc. 17.6 The said sections also clarify that if an agent acts in contravention of or if he disregards the direction by the principal then the agent would be liable to make good the loss to the principal which may be sustained by him. 17.7 The claimants cited instances wherein the dairy had, allegedly, not paid the commission. However, it is relevant that such actions were taken in accordance with and in exercise of the power conferred by the terms and conditions of the agreement. On this count what is more important is the fact that in present case not only the agreement but even the surety bond prescribed the condition that the booth operator shall have to make good the loss caused to the dairy (principal) and the booth operators had consciously accepted said condition and had agreed to make good the loss caused to the dairy (principal) and had agreed to abide by said condition. Such actions would, therefore, fall within the purview of Sections 211, 213 and 220 of Contract Act.
Such actions would, therefore, fall within the purview of Sections 211, 213 and 220 of Contract Act. 17.8 Thus, from above mentioned provisions it comes out that the principal has right to recover loss caused due to agent's acts of omission or commission. Actually such action is a recognized right of principal against his agent and such actions fall within the purview of above mentioned provision under Contract Act. Therefore, by disregarding all connected facts and the provisions in the agreement as well as the surety bond and above mentioned provisions, the actions by the dairy (of recovering loss or the instructions to the agent to make the loss good) cannot be categorized or branded as disciplinary action by employer. 18. Further, so far as the allegation of forfeiture of commission or the allegation that the dairy used to withhold the commission is concerned, it is relevant to note that Section 211 read with Section 220 also bring out that a principal is entitled to recover any loss caused to or sustained by him (on account of agent) from the agent and that the agent is bound to make good the loss sustained by the principal. The said provision, conjointly, also bring out that if an agent does not conduct business in the manner instructed by the principal or according to good, prudent and usual practice of the business then the agent will not be entitled to any remuneration in respect of that part of the business which he did not conduct as per instruction and/or he did not conduct with prudence and good business practice. Therefore, if the payment in respect of the actions of agent which are contrary to his instructions, is not made then in absence of other corroborative material, such action of the principal cannot be construed as action taken by the employer against an employee, much less as disciplinary action by employer. On this count it is relevant to note that an employer cannot deduct or withhold wages except in accordance with the procedure prescribed by Payment of Wages Act and such deduction or forfeiture of wages could not have been taken by way of penalty without following procedure for imposing penalty. There is no material on record to establish that procedure prescribed by Payment of Wages Act or for imposing penalty was being followed.
There is no material on record to establish that procedure prescribed by Payment of Wages Act or for imposing penalty was being followed. Such case is not even pleaded nor proved by booth operators. Therefore, the contention that such actions by the dairy amount to disciplinary action and it established that the dairy was their employer cannot be sustained and tribunal rightly rejected said submission. 18.1 Section 213 of Contract Act provides that agent is bound to render proper account to the principal on demand. The said provision makes it clear that the instruction to deposit the price (value) of the quantity of milk sold at the booth within the time fixed by the principal would fall within the purview of said Section 213. Therefore without having regard to other relevant aspects, such instruction cannot be termed as direction by or act of an employer and it cannot be construed or considered as proof or indication of employer and employee relation. Therefore, on such premise the contention that since booth operators were required to comply such instructions and since they were obliged to deposit the price of milk within time fixed by the dairy they should be considered employee, cannot be accepted or sustained. 18.2 Furthermore, in light of the fact that the dairy delivered milk on credit basis i.e. without insisting that the booth operators should pay price of the quantity of indented milk in advance or at the time of delivery, and the dairy allowed the booth operators to pay/deposit price of milk after sale was completed, it was natural and normal to ask for the payment and the accounts and to fix time for that purpose. Such instruction cannot be made basis for accepting the claim of the booth operators. Therefore also the decision by learned tribunal rejecting the said contention and contention that the authority exercised by the dairy in matter of fixing price of milk and fixing time for depositing the value/price of milk sold by each booth operators indicated and established relationship of employer and employee cannot be faulted and cannot be said to be arbitrary or perverse.
18.3 In light of above mentioned provisions under the Contract Act it becomes clear that the nature and type of the instructions which the dairy issued to the booth operators fall within the purview of authority of principal against his agent and within the purview of above mentioned provisions under Contract Act. The said provision make it clear that such instruction may be issued by the principal and the agent would be obliged to follow and comply the same. Therefore the claimants were not justified in contending that diverse instructions issued by the dairy established that the dairy was their employer and they should be considered employee of the dairy. The Tribunal did not commit any error in rejecting said contention. 18.4 It is also relevant and necessary to keep in focus that under the provisions of Food Adulteration Act 1954, any type of adulteration in milk is an offence. Adulteration in milk would be health hazard for customers. Moreover it would create criminal liability for the dairy and that therefore need to keep check to prevent adulteration cannot be undermined. In this view of the matter if random visits are taken as precautionary measure or to arrest and eliminate and avoid instances of adulteration or to find out, by means of interaction with the customers, whether they have any complaint about quality of milk and to find out whether the booth are kept clean or not, then such random visits at the booth (once or twice a month) cannot be construed or termed act of supervision and control over the booth operators or their performance and it cannot be said that such random or occasional visits by the officers of the dairy establishes relationship of employer and employee, more so when the evidence on record clearly brought out the fact that the visits were random once or twice in a month and the booth operators or their performance was never under regular or day-to-day or under continuous supervision or control. Such actions are also akin to the power and authority of principal over the contractor/agent. The provision under Sections 211 and 213 are wide enough to include such type of inspection or supervision by the principal. 19.
Such actions are also akin to the power and authority of principal over the contractor/agent. The provision under Sections 211 and 213 are wide enough to include such type of inspection or supervision by the principal. 19. Foregoing discussion and the findings recorded by learned Tribunal has brought out that the claimants have failed to establish their submission on the premise of supervision and control and the decision rejecting the claimant's contentions (including the contention that the actions by the dairy established employer and employee relation) is not wrong and does not deserve to be discarded or interfered with. Section 211 and 213 lend support to to the decision by learned Tribunal. The findings and conclusions recorded by learned Tribunal that the material/documents and/or the instances on which the booth operators placed reliance do not establish that they were employees of the dairy and their relation was of employer and employee. Further, the supervision and control factor is, even otherwise, not decisive factor to accept and hold that relation between the dairy and booth operators was of employer and employee. Actually what is necessary to examine is presence of effective and absolute control and complete administrative control – which is conspicuously absent in present case. Foregoing discussion has also established that the booth operators have also failed in establishing relation of employer and employee by invoking the “selection and appointment” factor. Foregoing discussion and material on record has brought out that the petitioner also failed in establishing relation of employer and employee by invoking and pleading other indicia via. payment of wages and right to terminate. The learned Tribunal considered and weighed and tested all aspects and all contentions based on said aspects on the touchstone of legal principles and precedents and in light of evidence on record and thereafter the learned Tribunal declined to accept those contentions and the claim by the booth operators. 19.1 It is relevant to note, at this stage, that in the case between workmen of Nilgiri Co-operative Mkt.
19.1 It is relevant to note, at this stage, that in the case between workmen of Nilgiri Co-operative Mkt. Society (supra) Apex Court observed inter alia, that the control test and the organization test are not the only factors which can be said to be decisive factor and with a view to reach to the answer the issue what is required is an integrated approach and the Court should consider several factors which would have bearing on this issue e.g. who is appointing authority, who is the pay master, who can dismiss the person, how long alternative service lasts, the extent of control and supervision, the nature of the job, nature of establishment, the right to reject etc. Hon'ble Apex Court also emphasized that supervision and control test is not universally correct and it is impossible to lay down any particular rule of law distinguishing one from the other and the said issue is question of fact which must be decided by taking into account all relevant facts and circumstances. In above mentioned decision in case of Nilgiri Coop. Mkt. Society (supra) Apex Court has observed that any decision does not lay 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 and any single test - be it control test, be it organisation or any other test – cannot be considered determinative for deciding jural relationship of employer and employee. 19.2 Foregoing discussion and above mentioned provisions have brought out that the characteristics of the arrangement between the dairy and the booth operators had the ingredients, the features and the characteristics of relation between principal and agent and that the booth operators were engaged and they worked as “agent” and they were not employees of the dairy. From foregoing discussion it also comes out that the factors which were relied on and emphasized by the claimants are such which would also exist in cases where the relation is of principal and agent or principal and contractor and the learned Tribunal has not committed any error. From the material or record it has also emerged that undoubtedly there is sufficient material on record to establish that the conclusion reached by the learned labour Court is a possible view and justified also.
From the material or record it has also emerged that undoubtedly there is sufficient material on record to establish that the conclusion reached by the learned labour Court is a possible view and justified also. 19.3 In this view of the matter even if there can be or even if there is another possible view then also this court would not interfere with and would not disturb sustainable view taken by the tribunal, more so when it is based on and supported by cogent evidence as well as sufficient, cogent and satisfactory reasons. 20. Before proceeding further it is necessary to recall that the dairy and its activities have been closed down and the assets have been sold off to discharge financial liabilities and obligations of the dairy. The closure has attained finality. Consequently all arrangements, contracts etc. entered into and executed by the dairy have come to end. 20.1 In this context profitable reference can be had to Section 207 of Indian Contract Act. On this count reference can also be had to the provision under Section 207 which provides, inter alia, the revocation of the agreement/arrangement between principal and agent can be express or it may be implied in the conduct of the principal (or agent as the case may be) and that the agency stands terminated when the principal revokes the authority or when business of the agency is completed. In present case the revocation or termination of the arrangement and the agreement between the booth operators and the dairy took place or occurred at the time when the dairy discontinued to supply milk to the booth operators and in any case when the dairy closed the undertaking and the activities. 20.2 It is, however, pertinent to note that the claimants never challenged said action of the dairy. Until now the termination or revocation of agreement is not challenged on any ground including the ground that it is illegal revocation or termination of contract or on the ground that said action of dairy amounts to their termination (i.e. termination of their service as employees of dairy) and such termination is illegal.
Until now the termination or revocation of agreement is not challenged on any ground including the ground that it is illegal revocation or termination of contract or on the ground that said action of dairy amounts to their termination (i.e. termination of their service as employees of dairy) and such termination is illegal. 20.3 On the other hand, regular and permanent employees of the dairy (not the booth operator) had challenged the closure of the establishment and the said challenge failed in the Court and the decision by the Court holding that the closure of the establishment was legal, has attained finality. Many years have passed since the said decision attained finality and more than 2½ decades have passed since the establishment as well as its activity came to be closed down. It is also pertinent that under Sick Industrial Companies (Special Provisions) Act, 1985 ('SICA' for short) the board had declared that the dairy was “sick unit”. Further, application seeking permission for closure of the dairy was allowed by the competent authority vide order dated 26.7.2002. Feeling aggrieved by the said order dated 26.7.2012 the employees of the dairy had sought reference which came to be rejected vide award dated 18.1.2005. The order dated 26.7.2002 passed by the specified authority has attained finality. The employees of the dairy had withdrawn the petition i.e. SCA No. 13041 of 2005 wherein the employees had challenged the order dated 26.7.2002. Despite this position, the booth operators, as mentioned above, never challenged said action of the dairy. In this context it is necessary to recall that even this proceeding has arisen from charter of demands and not from legal action or dispute against termination of the arrangement and termination of the contract/agreement. 20.4 In this backdrop even if it is assumed that in present case all relevant aspects are evenly balanced then one factor which, in such cases, may be important is “intention of the parties” (for entering into the arrangement with the claimants). 20.5 If it emerges, from totality of evidence, that the scales are more or less or almost evenly balanced between two possible views, then the factor which the Court will take into account and which may tilt the balance one way or other is “intention of the parties” with which the parties entered into the arrangement – relation.
20.5 If it emerges, from totality of evidence, that the scales are more or less or almost evenly balanced between two possible views, then the factor which the Court will take into account and which may tilt the balance one way or other is “intention of the parties” with which the parties entered into the arrangement – relation. Therefore the Court, in such cases would look for the intention of the parties. 20.6 The said crucial factor viz. intention can be culled out and gathered from the contract/agreement executed by and between the booth operators and the dairy and it can also be culled out from the manner in which the work was executed and the arrangement between the booth operators and the dairy was conducted. 20.7 The relation and the arrangement between the dairy and the booth operators came into existence by virtue of the agreement between the booth operators and the dairy. It is pertinent that a pre-condition prescribed by the dairy (when it invited the applications for engaging the booth operators) required that the person who desire to work as and desire to be engaged as booth operator should execute an arrangement and should submit surety bond/security deposit. In light of said pre-condition the booth operators executed the surety bond and also submitted security deposit. The said fact distinguishes the relation of the dairy and the booth operators and the arrangement between them from the relation of employer and employee. Besides this, the booth operators had, by virtue of the agreement and separate undertaking/bond executed by them accepted that the terms of the agreement shall bind them as well as their heirs/legal representatives. The said material and the terms of the agreement – when read conjointly – and the manner in which the work was carried out and the arrangement was conducted, establish that the dairy never intended to engage “employees” but it intended to engage “agent” or independent “contractor” to sell milk in accordance with special terms and conditions specified by virtue of the arrangement. 20.8 Thus, even from the perspective of “intention of the parties” the claims and contentions of the booth operators are not sustainable and their objection against the award cannot be accepted and sustained and the material available on record gives out that the conclusion and decision by the learned tribunal is not perverse and does not deserve to be disturbed. 21.
21. At this stage it would be appropriate to take into consideration the decision which learned Counsel for petitioners and respondent relied on. 21.1 In the decision in case of Dharangadhara Chemical Salt Works (supra) Hon’ble Apex Court observed, inter alia, that “the test which is uniformly applied in order to determine the relationship of employer and employee is the existence of right of control in respect of the manner in which the work is to be done and that in case where the relationship is that of principal and employer, the principal can order or require what is to be done while in other case where the relationship is of employer and employee, the employer can not only direct “what is to be done” but he can also order “how the work shall be done” or the act shall be performed. The nature of work should be taken into account while examining extent and/or nature of supervision and control. The extent of supervision and control can be determined in light of the facts of the case and nature of the work. In this context Apex Court observed in said decision that:- “The question whether the relationship between the parties is one as between employer and employee or between master and servant is a pure question of fact.” (emphasis supplied) 21.2 Having observed thus Hon'ble Apex Court further observed in the said decision that:- “The correct method of approach, therefore, would be to consider whether having regard to the nature of the work there was due control and supervision by the employer.” 21.3 In present case the facts and evidence have established that the visits were random (once or twice in a week) and that too the visits were undertaken as precaution to guard against possibility of adulteration and to ensure that booth were kept clean.
The learned Tribunal has, on examination of evidence, also reached to the conclusion that:- “The supervision is of random nature because as admitted by her supervisor goes to her booth once in a month which cannot be regarded as constant supervision exercised by the dairy” and that “The supervision is of random nature because as admitted by her supervisor goes to her booth once in a month which cannot be regarded as constant supervision exercised by the dairy” and it is further observed that:- The documents do not pertain to control and supervision in regard to the mode and method of sale of milk. Therefore, the factor of control and supervision as is popularly understood is absent in this case and that “Therefore, it is not possible to hold from the oral and documentary evidence which are discussed in this and the other paragraphs that the dairy has been exercising effective control and supervision over the booth operators consequently it is not possible to hold that this aspect has brought about the employer relationship between the parties.” 21.4 It is pertinent to note that in the decision in case of Silver Jubilee Tailoring House (supra) also Hon’ble Apex Court after taking into account the decisions in other cases observed that in modern industry, instead of concentrating on single test such as presence or absence of control, more complex test involving control, ownership of tools, chance of profit, risk of loss should be considered and applied and the test of control would not be conclusive and that in present times the control test, as traditionally formulated is not treated as exclusive test and that traditional concept of supervision is not relevant but more complex factor should be considered. It is observed in the said case that:- “It is, therefore, not surprising that in recent years the control test as traditionally formulated has not been treated as an exclusive test.” and that “26. During the last two decades the emphasis in the field has shifted and no longer rest so strongly upon the question of control. Control is obviously an important factor and in many cases it may still be the decisive factor. But it is wrong to say that in every case it is decisive.
During the last two decades the emphasis in the field has shifted and no longer rest so strongly upon the question of control. Control is obviously an important factor and in many cases it may still be the decisive factor. But it is wrong to say that in every case it is decisive. It is now no more than a factor, although an important and that.....“It is equally clear that no magic formula can be propounded which factors should in any case be treated as determining ones. The plain fact is that in a large number of cases, the court can only perform a balancing operation weighing up the factors which point in one direction and balancing them against those pointing in the opposite direction.” 21.5 Thus, the claim and contention could not have been decided merely on the basis of said factor. The Tribunal did not commit any error. 21.6 So far as the decision in case of D.C. Deewan Mohideen Sahib is concerned, Hon’ble Apex Court observed that:- In the present cases we have not got the full terms of the agreement and it is therefore not possible to say that there was no kind of supervision or control over the workers and that the so- called independent contractors had to accept all kinds of bidis whether made upto standard 'or not. It is hardly likely that the so-called independent contractor will accept bidis which are not upto the standard; for that is usually the system which prevails; in this trade as wilt be apparent from the facts of the many bidi manufacturing cases to which we have referred. We are therefore not prepared to hold in the absence of any evidence one way or the other that there is no supervision whatsoever of the work done by the workers. In the circumstances we are of opinion that the relationship of master and servant between the appellants and the workmen employed by the so-called independent contractors is established.” 21.7 Thus, the said case came to be decided in light of the evidence which was available and in light of the fact that the terms of the contract were not available and in absence of evidence it was not possible to hold that there was no supervision.
In light of the observation by Hon'ble Apex Court in above mentioned decisions it comes out that the instances on which the petitioner relied and/or the contentions raised by the petitioner do not establish their claim that the said instances establish that the dairy was their employer and they were the employees. 22. So far as decisions in case of Dharangadhara Chemical Work, D.C. Deewan Mohideen Saheb, Silver Jubilee Tailoring House are concerned it is relevant to note that in the said cases the Court considered contemporaneous practice i.e. the practice, procedure, manner and method which were being actually performed, followed, practiced and executed by the concerned persons (workers) at the time when the dispute or claim was raised and at the time when dispute was adjudicated and in said cases the practice which were discarded and discontinued before many years was not considered and evidence of such discarded practice was not relied on. Neither in the case of Dharangadhara Chemical Work or D.C. Deewan Mohideen Saheb or Silver Jubilee Tailoring House it was established that the practices or the method or manner of executing the principal work on which the claimants (workers) in said cases relied did not exist and such practices or method or procedure were abandoned before many years. Besides this, the said cases were decided in light of different set of facts and circumstances and in respect of altogether different type of product and different nature of work. In present case principal work i.e. sale of milk or home delivery of milk did not require continuous or regular supervision. Whereas in present case it is established and learned tribunal has recorded as finding of fact, that usual or traditional supervision by the employer (i.e. supervision over the manner in which the work is performed by the concerned person) did not exist in present case and the practice or procedure or method and manner on which the booth operators placed reliance were abandoned before many years and such practice did not deserve to be taken into account for determining as to whether the concerned persons can be considered employee of the dairy. The decision by Tribunal cannot be faulted.
The decision by Tribunal cannot be faulted. 22.1 So far as the decision in case of V.P. Gopala Rao (supra) is concerned it is necessary to note that the said matter arose from the prosecution instituted under Factories Act, 1946 and in respect of allegation about contravention of Section 6(1) of said Act. Thus, said matter came to be decided in light of the principles applicable in prosecution cases. Besides the said point of distinction between the cited decision and present case, factual background involved in the said case is also materially different from the facts involved in present case. The decision in said case is passed essentially on the facts involved in the matter therefore said decision does not render assistance to the petitioners. 22.2 So far as the decision in case of Bhagaband Collery (supra) is concerned in the said case learned tribunal had after appreciation of the evidence reached to the conclusion that Shirdars should be considered as employee of the collery. In view of the fact that the said findings and conclusions recorded by learned tribunal were based and supported by the evidence available on record, Hon'ble Apex Court held that “in respect of findings of fact based on material before the Tribunal, the Court would not enter into question of correctness of the findings.” The findings of fact recorded by the Tribunal in present case are supported cogent and satisfactory reasons based on proper appreciation of evidence on record and that therefore the findings or the decision in present case also do not warrant interference. 22.3 In case of Husainbhai vs. Alath Factory, the issue was considered in light of the fact that the concerned persons were engaged through intermediary contractor. In present case any intermediary does not exist and the relation between the dairy and the booth operators is required to be determined in light of the terms and conditions which were mutually agreed and accepted by the dairy and the booth operators (which cumulatively constituted the agreement between the parties). 22.4 When the award is examined in light of above quoted observations, it becomes clear that the learned tribunal has carefully weighed entire evidence and critically analyzed rival submissions and after such careful examination, learned tribunal has recorded its conclusion and findings.
22.4 When the award is examined in light of above quoted observations, it becomes clear that the learned tribunal has carefully weighed entire evidence and critically analyzed rival submissions and after such careful examination, learned tribunal has recorded its conclusion and findings. In that view of the matter it would appropriate to recall, at this stage, below quoted observation by Hon'ble Apex Court in case of Dharangadhara Chemical Works:- “It is equally well settled that the decision of the Tribunal on a question of fact which it has jurisdiction to determine is not liable to be questioned in proceedings under Art. 226 of the Constitution unless at the least it is shown to be fully unsupported by evidence.” 22.5 The said restriction would be equally, rather more, applicable in case of proceeding under Article 227 of the Constitution of India. In this context. Profitable reference can also be had to the observations by Hon'ble Apex Court in case of Mohammad Yunus vs. Mohammad Mustaqim, AIR 1984 SC 38 wherein Hon'ble Apex Court observed, inter alia, that:- 6......A mere wrong decision without anything more is not enough to attract the jurisdiction of the High Court under Article 227... 7. The supervisory jurisdiction conferred on the High Courts udder Art. 227 of the Constitution is limited "to seeing that an inferior Court or Tribunal functions within the limits of its authority", and not to correct an error apparent on the face of the record, much less an error of law. In this case there was, in our opinion, no error of law much less an error apparent on the face of the record. There was no failure on the part of the learned Subordinate Judge to exercise jurisdiction nor did he act in disregard of principles of natural justice. Nor was the procedure adopted by him not in consonance with the procedure established by law. In exercising the supervisory power under Art.227, the High Court does not act as an Appellate Court or Tribunal. It will not review or re-weigh the evidence upon which the determination of the inferior court or tribunal purports to be based or to correct errors of law in the decision. 23. In this view of the matter there is no basis or justification to disturb the award.
It will not review or re-weigh the evidence upon which the determination of the inferior court or tribunal purports to be based or to correct errors of law in the decision. 23. In this view of the matter there is no basis or justification to disturb the award. Beside this, the subsequent decisions particularly the decisions in case of Balwant Rai Saluja and the decision in case of Workmen of Nilgiri Co-operative Society as well as the decision in case of International Airport Authority indicate and have brought out that the concept of supervision and control has undergone substantial and material change and the concept of supervision and control should be examined from the perspective of complete administrative control and not merely on the basis of random or casual supervision or nominal or minimum control which may be inherent in every arrangement or relation. Hon'ble Apex Court has also held that in present times singular test of supervision and control is not considered proper and adequate test for determining the relationship. More complex factors and multiple test and various other features are considered necessary for determining the relationship of employer and employee and/or for distinguishing the said relationship from the relationship of principal and agent. 23.1 Learned Tribunal has, after taking into account the legal position explained by Hon'ble Apex Court and applied by Apex Court in case of Dharangadhara Chemical Work and D.C. Deewan Mohideen Saheb and Silver Jubilee Tailoring House and the other decisions reached to the findings of fact that the booth operators failed to establish that the dairy exercised supervision and control over their performance and that the payment made to the booth operators was purely commission and not wages and that the booth operators also failed to establish that any other factor which could establish relationship of employer and employee existed in their relation with the dairy. The findings of fact recorded by the Tribunal and the final decision and the verdict are supported by subsequent decisions in case of Balwant Rai Saluja, Nilgiri Cooperative Marketing Society, National Aluminum Company Limited (NALCOs case) wherein Apex Court explained that the concepts have undergone substantial change and what deserve to be considered is “effective and absolute control over the claimants and their performance” and that proper course to determine the said complex issue would be to marshal various tests.
Therefore it would be appropriate at this stage to take into account observation by Hon'ble Apex Court in the said decisions. 23.2 In the decision in case of Balwant Rai Saluja, (supra) Hon'ble Apex Court observed in paragraph No. 52 that:- “52. ......To ascertain whether the workers of the contractor can be treated as the employees of the factory or company on whose premises they run the said statutory canteen, this Court must apply the test of complete administrative control......” (emphasis supplied) 23.3 Thus, the test which should be applied is test of “complete administrative control”. The facts of present case and evidence on record and more particularly findings of fact recorded by learned Tribunal have brought out that the dairy did not exercise such supervision and control. In paragraph No. 57 in the said decision Hon'ble Apex Court observed that:- “57....'there was no single test to determine such a relationship. Therefore what would be needed to be done is to marshal various tests, which should cumulatively point either towards an employer-employee-relationship or away from one.” 23.4 The said observations and similar observations in other decisions have brought out and emphasized that the supervision and control test or the organization test are, as exclusive or singular test, not sufficient or proper criterion to decide the issue related to employer and employees relation but host of facts and factors and combination of various tests should be applied for deciding the said issue. Whereas in present case the booth operators heavily relied on the said factor and they cited various instances to establish that the dairy exercised supervision and control. Of course, they also claimed that they were appointed by the dairy and the dairy also terminate the contract. The emphasize and concentration however remained on supervision and control by the dairy. Foregoing discussion has established that the instances as well as instructions relied on and emphasized by the booth operators failed to and could not establish that the dairy exercised supervision and control, much less, absolute and effective control or complete administrative control. As observed by Hon'ble Apex Court in said decision therefore the consideration should be about “nature of control”. So as to address the said issue in the said decision, Hon'ble Apex Court considered it appropriate to examine whether such control (which air India may have) may be called “effective and absolute control” or not.
As observed by Hon'ble Apex Court in said decision therefore the consideration should be about “nature of control”. So as to address the said issue in the said decision, Hon'ble Apex Court considered it appropriate to examine whether such control (which air India may have) may be called “effective and absolute control” or not. Thus, what is necessary is presence of “effective and absolute control”. Hon'ble Apex Court observed that for being called employees of the factory the claimants must show that the factory exercised absolute and effective control over them”. However, in present case the petitioner failed to establish presence of said factor. In the said decision Hon'ble Apex Court also observed that “mere fact that Air India had certain degree of control over HCI does not mean that employees working in the canteen are Air India employee or air India exercises control i.e. in nature of supervision....... the said supervision or control would appear to be merely to ensure maintenance or standard and quality in the said canteen.” As final decision Hon'ble Apex Court observed that:- “88. Therefore, in our considered view and in light of the above, the appellants workmen could not be said to be under the effective and absolute control of Air India. The Air India merely has control of supervision over the working of the given statutory canteen. Issues regarding appointment of the said workmen, their dismissal, payment of their salaries, etc. are within the control of the HCI. It cannot be then said that the appellants are the workmen of Air India and therefore are entitled to regularization of their services.” (emphasis supplied) 24. From above quoted observations it comes out that Apex Court has recognized that to ensure maintenance of standard and quality, control or supervision to some extent would always be necessary and such nominal or minimum or random supervision or control would not establish or would not create employer and employee relationship or would not convert relation of principal and agent into relation of employer and employees.
In present case having recorded findings of fact that the evidence established that the visits by officers of the dairy were random and such visits were carried out once or twice in month and that such visits were essentially undertaken by way of precaution against adulteration in milk and to find out as to whether the booth operators kept the booths hygienically clean or not, learned Tribunal rejected the claim and contention by the booth operators. When present case and the findings as well as final decision by the Tribunal are examined in light of above quoted observation in case of Dharangadhara Chemical Work and Silver Jubilee Tailoring House and more particularly in light of the observations in subsequent decisions in case of Balwant Rai Saluja and NALCO and Nilgiri Co-operative Society it becomes clear that the claim and contentions by the booth operators could not have been sustained and learned tribunal rightly rejected the same. 24.1 At this stage it would not out of place to also take into account the observations by Hon'ble Apex Court in NALCO case. In the said case the employee of the school established by NALCO claimed declaration that they should be considered employees of NALCO. From relevant facts of the case, Hon'ble Apex Court noticed that two schools were established by the NALCO and NALCO also provided necessary infrastructure. NALCO also provided adequate financial support. NALCO also provided staff quarters for the employees of the school. Two schools were established by the NALCO in its own township which was set up for employees of NALCO with a view to providing educational facility to the children of its employees. Day to day management of the school was entrusted to the central Chinmaya mission. The school building were constructed by NALCO and furniture, fittings etc. were provided by NALCO and for various facilities such as medical facility, consumer co-operative, club etc. the employees of school were treated on part with employees of the NALCO. In this background above mentioned declaration was prayed for. After considering respective submissions High Court held that real control and supervision over the employees and other claimants was that of NALCO.
were provided by NALCO and for various facilities such as medical facility, consumer co-operative, club etc. the employees of school were treated on part with employees of the NALCO. In this background above mentioned declaration was prayed for. After considering respective submissions High Court held that real control and supervision over the employees and other claimants was that of NALCO. It is pertinent that in NALCO's case though it was not in dispute that the schools were constructed by NALCO, schools were established by NALCO in its own township and that the schools were established for providing education facility to children of NALCO's employees and the buildings, fittings, furniture etc. were also provided by NALCO and NALCO has also provided financial assistance, Hon'ble Apex Court disagreed with the decision by High Court and observed that “merely because schools are set up by NALCO or they have agreed to take care of financial deficit for running school, according to us are not of conclusive factors”. It is necessary to note that even after acknowledging that there was element of control by NALCO, Hon'ble Apex Court observed that : “30. No doubt, there may be some element of control of NALCO because of the reason that its officials are nominated to the Managing Committees of the schools. Such provisions are made to ensure that schools runs smoothly and properly by the society. It also becomes necessary to ensure that the money is appropriately spent. However, this kind of 'remote control' would not make NALCO as the employer of these workers. This only shows that since NALCO is shouldering and meeting the financial deficits, it wants to ensure that money is spent for rightful purposes.” (emphasis supplied) In the said case of NALCO Hon'ble Apex Court held that judgment by High Court was not sustainable. 24.2 Differently put, some extent of control is recognized and accepted in almost all type of arrangement even in relation of principal and agent. Merely because nominal or meager extent of control exists, conclusion about existence of employer and employee relationship cannot be recorded. As observed in case of Balwant Rai Saluja and NALCO it was necessary to establish complete administrative control and effective and absolute control. 25. At this stage, it is appropriate to turn to the decision in case of workman of Nilgiri Cooperative Marketing Society.
As observed in case of Balwant Rai Saluja and NALCO it was necessary to establish complete administrative control and effective and absolute control. 25. At this stage, it is appropriate to turn to the decision in case of workman of Nilgiri Cooperative Marketing Society. In the said decision, after taking into account the factual backdrop to the effect that:- “4. The Society has two big marketing yards at Mettupalayam. In the said yards, auction of vegetables takes place. Infrastructure therefor such as offices, godowns yards, weighing machines etc. are provided by the Society. There are two separate yards with pucca godowns, one for potatoes and another for vegetables. The primary members of the Society bring their agricultural produce to the yards by hired lorries or trucks.......... 5. The following main jobs are carried out in the said premises: (i) unloading of the gunny bags containing potatoes from the lorries; (ii) unpacking the gunny bags and keeping the potatoes in lots inside the godown; (iii) grading the potatoes into different sorts; (iv) weighing the auctioned potatoes in 45 kgs. and packing them into gunny bags brought by the merchants; (v) stitching the gunny bags and loading them into lorries hired by the merchants.” 26. Having regard to the said factual backdrop and judicial pronouncement in other decisions, Apex Court observed that:- “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. (emphasis supplied) 35. In a given case it may not be possible to infer that a relationship of employer and employee has come into being only because some persons had been more or less continuously working in a particular premises inasmuch as even in relation thereto the actual nature of work done by them coupled with other circumstances would have a role to play. 42.
42. The decisions of this Court lead to one conclusion that law in this behalf is not static. (emphasis supplied) 27. Hon’ble Apex Court emphasized that:- “47. It is a well-settled principle of law that the person who sets up a plea of existence of relationship of employer and employee, the burden would be upon him.” 34. ......supervision and control test is the prima facie test for determining the relationship of employment. The nature or extent of control required to establish such relationship would vary from business to business and, thus, cannot be given a precise definition. The nature of business for the said purpose is also a relevant factor.” 27.1 Thus, the presence and extent of contract – the said test – has to be applied by keeping in focus the nature of business. The Tribunal has, after considering said aspect, rejected the claim and contention. Hon’ble Apex Court also emphasized that:- “37. The control test and the organization test, therefore, are not the only factors which can be said to decisive. With a view of elicit the answer, the court is required to consider several factors which would have a bearing on the result : (a) who is appointing authority; (b) who is the pay master; (c) who can dismiss; (d) how long alternative service lasts; (e) the extent of control and supervision; (f) the nature of the job, e.g. whether, it is professional or skilled work; (g) nature of establishment; (h) the right to reject. 38. With a view to find out reasonable solution in a problematic case of this nature, what is needed is an integrated approach including the test whether the workman concerned was fully integrated into the employer's concern meaning thereby independent of the concern although attached therewith to some extent. and that If the provisions of the contract as a whole are inconsistent with its being a contract of service, it will be some other kind of contract and the person doing the work will not be a servant. (emphasis supplied).... and Hon’ble Apex Court concluded that:- “95. Having regard to the aforementioned findings, we are of the opinion, the High Court has rightly affirmed the award of the Industrial Tribunal.
(emphasis supplied).... and Hon’ble Apex Court concluded that:- “95. Having regard to the aforementioned findings, we are of the opinion, the High Court has rightly affirmed the award of the Industrial Tribunal. The Tribunal as also the High Court further rightly arrived at a finding to the effect that the concerned workmen were not able to discharge their burden of proof that they were employed by the Society. 96. The decisions referred to hereinbefore are indicative of the fact that the different tests have been applied in different cases having regard to the nature of the problem arising in the fact situation obtaining therein. .............” 98. It has been found that the employment of the workmen for doing a particular piece of work is at the instance of the producer or the merchants on an ad hoc basis or job to job basis and, thus, the same may not lead to the conclusion that relationship of employer and employee has come into being. Furthermore, when an employee has a right to work or not when an offer is made to him in this behalf by the producer or by the merchants will also assume significance. 99. For the purpose of earning livelihood, a person has to involve himself into certain kinds of activities wherefor, he must subject himself to some sort of discipline or control, which is even otherwise implicit”. 28. It emerges from above quoted conclusion and final decision that even in case where the activities were carried on in the market-yard (employer's premise) and the requisite infrastructure was provided by the society, and the activities performed by the claimants were, to an extent, connected with the object of the society, Hon’ble Apex Court did not accept that the claimants were or can be considered employees of the society. In said decision Hon'ble Apex Court also observed that the onus to prove their status as employee was on the claimants and they failed to prove that. In present case also, as rightly held by learned tribunal the claimants have failed to prove that they were employees of the dairy. 29.
In said decision Hon'ble Apex Court also observed that the onus to prove their status as employee was on the claimants and they failed to prove that. In present case also, as rightly held by learned tribunal the claimants have failed to prove that they were employees of the dairy. 29. In the decision in case of West Bengal Registration Copywriter Association, (2009) 14 SCC 132 Hon’ble Apex Court examined similar issue in backdrop of the fact that the appointment and working of the claimants/copywriters was governed by the West Bengal Registration Copywriter Rules 1982 and West Bengal Registration Copywriter Rules 1999 read with Investment or Registration (filing of true copies) Rules 1979. “3. .......The common case emerging before the High Court was that the members of the West Bengal Registration Copywriters' Association (hereinafter referred to as ‘the Association'), as well as, the applicants in the original applications were the licensees under the West Bengal Registration (Copywriters) Rules, 1982 (hereinafter called ‘the Copywriters' Rules of 1982' for short), which were replaced by the West Bengal Registration (Copywriters) Rules, 1999 (hereinafter called ‘the Copywriters’ Rules of 1999' for short). In the said case the State of West Bengal claimed that:- “11. It was pointed out that there was no employer-employee relationship between the members of the Association i.e. Copywriters and the State of West Bengal, and as such, the Tribunal had no jurisdiction to decide the issues raised. It was pointed out that the Copywriters were license holders under the Copywriters' Rules of 1982 (at present under the Copywriters' Rules of 1999) and they were merely holding the licenses to be eligible to perform the duties of Copywriters. Such duties were not under the State of West Bengal and in fact, the Copywriters were individual professionals and earned fees for job by the public in general, who come in the Registration Office for registering their documents. 12. It was pointed out that the licenses of the Copywriters merely enable them to make out the copies of documents, which is a statutory requirement. As the Rules provide, for filing of the true copies alongwith the documents which were produced before the Registrar and since the Government had to ensure the authenticity of such documents, accordingly, the Rules were framed granting licenses to the Copywriters, who were authorized persons to prepare copy of the original documents.” 30.
As the Rules provide, for filing of the true copies alongwith the documents which were produced before the Registrar and since the Government had to ensure the authenticity of such documents, accordingly, the Rules were framed granting licenses to the Copywriters, who were authorized persons to prepare copy of the original documents.” 30. In the said case the claimants, copywriters claimed that they were regular employees in the cadre of lower division clerk and they also prayed for absorption/regularization as regular employees. For deciding rival claims Hon’ble Apex Court considered the Rules 2 (3), Rules 3 to 10, Rules 15, 17, 19, 20(2), 21, 24 and 26. 31. From above quoted rules it comes out that the person who desire to work as copywriter have to obtain license from the authority prescribed by the rules. Rule 3 of said rules prohibit unauthorized person i.e. person who is not a licensed, to work as copywriters. The rules also prescribe upper age limit as well as minimum education qualification for the applicant. Sub-rule (3) of Rule 5 prescribes that the person who has passed school final or its equivalent examination shall be eligible to apply for copywriters license or if he has passed class-VI examination and has gained experience as an Assistant Deed Writer for not less than 3 years then he would be eligible to apply for license. Thus, the rules prescribe criteria regarding eligibility. The Rule 7 thereof also prescribes criteria for disqualification and Rule 15 prescribes the rights and duties of the copywriters followed by Rule 17 which makes provision of circumstances when the license may be cancelled. The District Registrar is conferred the authority to cancel the license. The Sub-rule (2) of Rule 17 prescribes that in case of breach of the rules or in case of misconduct the license can be cancelled. Rule 19 makes provision for suspension of the license and Rule 21 requires that the applicant shall have to pass the test conducted by the authority and his handwriting should be legible and conduct should be good. Meaning thereby not only minimum eligibility criteria and standard are fixed by the State but requirements such as legible handwriting is also prescribed by the State. The rules also prescribe the duties of the copywriters. Further, copywriters work in the precincts of registrar's office.
Meaning thereby not only minimum eligibility criteria and standard are fixed by the State but requirements such as legible handwriting is also prescribed by the State. The rules also prescribe the duties of the copywriters. Further, copywriters work in the precincts of registrar's office. Moreover, Rule 15(2) specifically emphasize that copywriter shall work under control and supervision of the registering officer. Meaning thereby power to supervise and control is conferred to the registering officer by the rules and the said officer exercised such powers. The copywriters are, thus, subjected to supervision and control of registering officer. The registrar also possess power to suspend and cancel the license in case of disobedience of instructions or orders. The rules confer power to registering officer to issue orders/directions and instructions from time to time and rule 19 provide that if copywriter is found guilty of disobedience then the license may be suspended or cancelled. It was claimed that said provision confer disciplinary power. The copywriters are also required to pass licensing test. Not only this, but the Rules more particularly, Rule 24 prescribes the rate of remuneration and thereby the rules even regulate the fees/charge which the copywriter can demand/collect for the work done by him. Differently put their remuneration is also fixed by means of the rules. 31.1 Despite such provisions and inspite of the fact that the registering officer/registrar could exercise effective and complete control and inspite of the fact that the copywriters were subjected to qualifying test, eligibility criteria, and the officer also possessed power to suspend or terminate the license in case of disobedience or where the directions are not followed, Hon'ble Apex Court held that the copywriters are merely licensee and not government employees. Hon’ble Apex Court observed that:- “60. When we see the aforementioned Rules, they nowhere provide even distantly, any master and servant relationship in between the State Government and the Copywriters. It is the basic principle of interpretation that where the language of the Statute is clear and admits of no doubt, then the Court will accept the plain meaning of the provisions. Applying the test of plain meaning, no Rule either under the Copywriters' Rules of 1982 or the Copywriters' Rules of 1999, can be read as clothing the Copywriters with the status of Government servants.
Applying the test of plain meaning, no Rule either under the Copywriters' Rules of 1982 or the Copywriters' Rules of 1999, can be read as clothing the Copywriters with the status of Government servants. The Rules, at the most, provide for the licenses armed with which, the Copywriters can follow the profession of Copywriting, as is clear from Rule 3 of the Copywriters' Rules of 1982.... and that .....(86) There were, undoubtedly, the rules for the Copywriters, but those rules could never be read as creating a separate Government service. They, at the most, were licensees. Firstly, these Writ Petitioners were not paid from the coffers of the Government. Secondly, though there was an apparent control, there was no control on their actual working..... and that The grant of licenses was bound to be under the rules and, therefore, their continuation, termination or suspension was also bound to be under the rules. But, that was the only scope. The rules never provided as to how the working of the Copywriters would be controlled. They were, undoubtedly, independent professionals. They could come and leave at any time. Nobody could compel their attendance and the disciplinary control which was pressed into service by Shri Mitra and others was only in respect of the continuation of their licenses.” 32. Upon appreciating the said provisions Hon’ble Apex Court further observed, inter alia, that:- “89. Such a disciplinary control would be available in case of all the licensees in whatever Department the licenses are given. A criminal cannot be allowed to enjoy a license nor could a person, who misbehave, could enjoy the continuation of a license. That is not the test, much-less to hold such persons to be the persons on the Government establishment. ... and that (91) Much was spoken about the selection of these Copywriters. If they were Copywriters, the Government was perfectly justified in holding the tests for awarding the licenses. A person with horrible handwriting or a person with illegible handwriting could never had been given this license, which essentially required good handwriting, so that it should be legible copy of the deed which is offered for the registration. This certainly was not a Government duty. In our opinion, the Government duty would start only after the deed is presented for the registration.
This certainly was not a Government duty. In our opinion, the Government duty would start only after the deed is presented for the registration. This would also include the checking as to whether the deed is accompanied with by a legible copy thereof. But, writing of the copy, in our opinion, could never amount to a Government duty or a statutory duty.” 33. With reference to the contention that the claimants (copywriters) should be considered government employees because before engaging the copywriters they were required to undergo the test, Hon’ble Apex Court observed that a person with horrible handwriting or a person with illegible handwriting could never have been given license and therefore government was justified in holding the test and such requirement would not establish relationship of employer and employee. Differently put Hon’ble Apex Court held that having regard to special need for particular qualification or experience the licensor (principal) would be justified in prescribing certain eligibility or qualifying criteria or requirement or conditions and such prescription would not convert a licencee into an employee or it would not confer status of employee to the licence and that would not be sufficient to create or infer relationship of employer and employee. In this view of the matter the reference of some criteria in the Notice inviting applications could not have been justification or ground to assume or to see employer and employee relation in the arrangement between dairy and booth operators. In the said decision Hon’ble Apex Court further observed that:- “96. Now, we will take the most crucial question regarding the master and servant relationship. Admittedly, these Copywriters did not get paid by the Government. Government had no responsibility, whatsoever, to pay or even to ensure that they got paid a particular amount. While one Copywriter could earn Rs.1,000/- a day, the other could remain content with Rs.50 a day, depending upon the work that he has handed out. It was not the duty of the Government to see that every Copywriter gets some minimum wages. In fact, the concept of "payment of wages" by Government is totally absent. What the Copywriters got and were entitled to get was a fees for their services to the private persons, who wanted to get their deed registered.... and that (94)....The servant must be under the total control of the master insofar as duties are concerned.
In fact, the concept of "payment of wages" by Government is totally absent. What the Copywriters got and were entitled to get was a fees for their services to the private persons, who wanted to get their deed registered.... and that (94)....The servant must be under the total control of the master insofar as duties are concerned. We have already given a finding that there was no control as such on the working of these Copywriters. They were merely licensees and if there was any control, the control was only on their licenses. There was no control over the manner in which they do their work of copying. (emphasis supplied) 34. After considering the provision which conferred power to suspend and even cancel the license for disobedience and for not complying the directions, Hon'ble Apex Court observed that:- “95. Again, there has to be a disciplinary control which is conspicuously absent in this case. The control was only qua the licenses, their continuation or their termination. Therefore, we are unable to accept the argument of Shri Mitra that from the bare reading of the rule we must hold that there was a total control by the Government over the working of these Copywriters. 97. Once all these factors are considered cumulatively, it is obvious that there was no trace of master and servant relationship.” 35. Thus, the said decision by the Tribunal, as well as the decision that the actions by the dairy cannot be termed or construed as disciplinary action by employer, cannot be faulted. 36. Hon’ble Apex Court also took into account the requirement that “The servant must be under “total control of the master” and that so far as duties are concerned and that there should be disciplinary control in the hands of the master.” and Apex Court distinguished between said power (i.e. disciplinary control) and control qua licensee, their continuation or their termination (i.e. power of discretion to continue or terminate). Thus, Apex Court explained that the claimants must establish and Court must ask about “total control of master”. The evidence on record has established that the said factor was absent in present case. 36.1 Hon’ble Apex Court summarized the status of the claimants and observed that:- “(i) That the original Writ Petitioners-Copywriters are mere licensees.
Thus, Apex Court explained that the claimants must establish and Court must ask about “total control of master”. The evidence on record has established that the said factor was absent in present case. 36.1 Hon’ble Apex Court summarized the status of the claimants and observed that:- “(i) That the original Writ Petitioners-Copywriters are mere licensees. (ii) Though the Rules have been formulated by the Government for awarding these licenses the Rules do not spell out an absolute control over the working of these Copywriters. The Rules merely pertain to the grant of licences and control of those licences, however, did not control the working and duties of the Copywriters. (iii) The Copywriters do not do any Government duty. They are merely required to copy the deeds which are to be presented for registration. Though the filing of a fresh copy is necessary for registration, the making of that copy does not amount to a Government duty. (iv) The Copywriters are not controlled in the matters of their attendance, working hours, leave, pension and output of work etc., by the Government. (v) The Copywriters are not on the establishment under the Rules, more particularly the Rules formulated under Article 309 of the Constitution of India. (vi) The Copywriters are not paid from the Government coffers. On the other hand they are paid by the private parties who require those copies for Registration of the deeds. Therefore, there is no fiduciary relationship between the Government and the Copywriters nor is the government responsible for any such payment. (vii) In short the grant of licence for copywriting does not amount to creating a service. Hence there is no master-servant relationship between the Copywriters and the Government nor can they said to be Government servants entitling them to so-called equal treatment with the other Government servants. (viii) The High Court has erred in directing the creation of service and for that purpose framing the Rules as also providing the nomenclature for such a service. In that the High Court has traveled beyond the scope of the original application and the writ petition.” 37. From the said observations it comes out that Hon’ble Apex Court recognized that certain extent of control would be necessary in cases of arrangements/relations created on license basis and that existence of such control cannot be exclusive test to hold that such persons are employees on government establishment.
From the said observations it comes out that Hon’ble Apex Court recognized that certain extent of control would be necessary in cases of arrangements/relations created on license basis and that existence of such control cannot be exclusive test to hold that such persons are employees on government establishment. Further in light of the rules and final decision by Apex Court with reference to said rules which prescribe the remuneration or fees (to be charged by copywriters) and the position – status of copywriters it also emerged that the booth operators' contention on the premise that the dairy fixed the price of milk and/or that the dairy fixed the rate of the commission established that they were of employees of the dairy is rightly rejected by the Tribunal. In this view of the matter, the contentions raised by the booth operators in present case do not render any assistance to the booth operators. After considering the fact that the copywriters are governed by the said rules, Hon'ble Apex Court held that they were merely licensee and cannot be termed to be employees. Whereas in present case as against the fact that copywriters are required to pass licensing test and they are also bound by the rules and by specific provision under the rules, they are obliged to follow and comply the direction by the registrar, the booth operators were not subjected to the rigours of the discipline and conduct and Appeal Rules or any other Rules of the dairy (applicable to dairy's employees) and said Rules were not applicable and binding to the booth operators. In this view of the matter decision by learned Tribunal cannot be faulted and the view taken by this Court gets fortified by the observations in the said decision. 38. At this stage it would be appropriate to take into consideration the facts of a case of New Swadeshi Mills 1967 GLR 345 where the claimant was engaged by virtue of an agreement, as “Dalal” (agent) for the purpose of selling clothes manufactured by the principal. In the decision in case of J. Sarabhai vs. New Swadeshi Mills this Court considered below mentioned facts:- “The applicants are a partnership firm and they were appointed as Dalals by the Company for sale of cloth manufactured by the Company throughout the whole of India on the terms and conditions recorded in an agreement dated 10th April 1961.
In the decision in case of J. Sarabhai vs. New Swadeshi Mills this Court considered below mentioned facts:- “The applicants are a partnership firm and they were appointed as Dalals by the Company for sale of cloth manufactured by the Company throughout the whole of India on the terms and conditions recorded in an agreement dated 10th April 1961. Pursuant to their employment as Dalals under the said agreement the applicants acted as Dalals for sale of cloth manufactured by the Company from 21st January 1961 upto 31st March 1962 and after giving credit to the Company for various payments made to the applicants from time to time a sum of Rs. 66 33 ps. became due and payable by the Company to the applicants as on 31st March 1962.” The applicants were therefore unsecured creditors of the Company in the sum of Rs. 66 33 ps. at the date when the Scheme was put forward for the sanction of the Court. Clause 6 of the Scheme made provision for payment of arrears of wages unpaid bonus wages in lieu of leave and gratuity to the employees of the Company and so far as unsecured creditors of the Company other than its employees were concerned Clauses 7-7 and 7B of the Scheme provided that the unsecured creditors should lodge their claims before the Official Liquidator of this Court on or before 20th November 1963 and such claims should be verified by Messrs. C.C. Chokshi and Company Auditors and in case any unsecured creditors disputed the verification the claim should be taken to the learned Judge taking Company matters and his decision would be final and the unsecured creditors should be entitled to receive payment of 40 per cent of the verified claims from the respondent. 39. In light of the scheme of arrangement or compromise for payment of arrears of wages, bonus, gratuity wages in lieu of leave etc. and the agreement between the company and the claimants – who, according to the company, were sole selling agents the Court examined the demand set-up by the claimants as well as their claim that they were employees and addressed the issue that:- “if the applicants were employees of the Company the sum of Rs. 39 619 ps.
and the agreement between the company and the claimants – who, according to the company, were sole selling agents the Court examined the demand set-up by the claimants as well as their claim that they were employees and addressed the issue that:- “if the applicants were employees of the Company the sum of Rs. 39 619 ps. representing the balance of the amount of Dalali due to them would be arrears of wages and the applicants would be entitled to recover the same from the respondent under Clause 6 of the Scheme. But for reasons which I shall presently state it is clear that the applicants could not possibly be regarded as employees of the Company and the claim made by them in this Summons on the basis that they were such employees and the amount due to them represented arrears of wages under Clause 6 of the Scheme must therefore be rejected.” 40. So as to determine the legal relationship between the claimant and company, the Court observed that:- “(2.) In order to determine the legal relationship between the applicants and the Company it is necessary to look at the agreement dated 10th April 1961 which recorded the terms and conditions on which the applicants were appointed as Dalals by the Company.” After considering the agreement the Court observed, that:- “The agreement in its opening part declared that the Company has appointed the applicants as its cloth Dalals for the whole of India and the applicants have agreed to their appointment as such for The purpose of selling cloth manufactured by the Company for the period commencing from 21st January 1961 and ending on 20th January 1966 on the terms and conditions contained in the agreement. Clauses 1 and 2 of the agreement then proceeded to state as follows:- 1. That the Dalals shall have the sole and exclusive rights of selling the cloth manufactured by the Company provided that nothing herein contained shall be deemed to prevent the Company from supplying or selling the cloth direct to persons or firms or concerns or creating other selling agencies for any defined territories provided the Dalals are paid their Dalali on such sales effected directly by the Company or through others. 2.
2. That the Dalals guarantee the bona fides of the offers brought by them and further guarantee that if the Company accept such offers the offers will fulfil his part of the contract for the sale resulting from such offer and its acceptance.” 41. After considering the said provisions in the agreement the Court held, inter alia that : “Now it is difficult to see how any relationship of employer and employee can be spelt out from these provisions of the agreement. It is clear beyond doubt that by the agreement the applicants were appointed selling agents for the whole of India for the sale of cloth manufactured by the Company and the legal relationship between the Company and the applicants was that of principal and agent and not that of employer and employee. ........... Clauses 3 4 and 17 on which reliance has been placed merely set out what is implicit in the relationship of principal and agent and lay down certain restrictions on the right of the agent and certain safeguards for the principal. Clause 3 of the agreement states that offers brought by the applicants shall be deemed to be accepted by the Company only if the Company signifies the acceptance in writing. This provision appears to have been made for the purpose of avoiding any confusion or misunderstanding which may perhaps arise between the applicants and the Company. Clause 4 then says that the applicants shall not effect any sales under the agreement except with the express consent of the Company as regards the terms or otherwise. This provision merely recognises the right of the principal to lay down the terms and conditions of the sales which the agent is authorized to effect on his behalf. Clause 17 requires the applicants to carry out and follow any instructions which might be given to them from time to time by the Company in matters arising under the agreement and this provision is also in no way inconsistent with the relationship of principal and agent. The agent must necessarily act in the matter of the agency according to the instructions of the principal. None of these clauses relied upon by Mr. V.S. Parikh provides that the Company shall be entitled to dictate to the applicants the manner or method of doing the work of sole selling agency.
The agent must necessarily act in the matter of the agency according to the instructions of the principal. None of these clauses relied upon by Mr. V.S. Parikh provides that the Company shall be entitled to dictate to the applicants the manner or method of doing the work of sole selling agency. The word Dalal in Gujarati means a broker or agent and when the agreement in terms says that the applicants are appointed Dalals for sale of cloth manufactured by the Company it is impossible to hold that the applicants are not brokers or agents appointed by the Company but are employees of the Company. Clause 1 of the agreement confers sole and exclusive right on the applicants to sell the cloth manufactured by the Company with a reservation that the Company may if it thinks fit sell cloth direct to persons or firms or create other selling agencies for any defined territories. But in that case the Company would still have to pay Dalali to the applicants on sales effected directly or through other selling agencies. The use of the words other selling agencies clearly suggests that the applicants are selling agents of the Company. The provision in clause 2 of the agreement that the applicants guaranteed the fulfillment of the contracts by merchants and the provision in clause 5 that the applicants shall be responsible to a limited extent for nonpayment of any amount by the merchants are the usual provisions in a sole selling agency agreement and negative the relationship of master and servant. The agreement read as a whole leads to one and only one conclusion namely that this is an agreement between principal and agent and not an agreement between master and servant. I am therefore of the view that the legal relationship between the Company and the applicants under the agreement was not that of master and servant and the applicants were not employees of the Company within the meaning of clause 6 of the Scheme. The claim made by the applicants in the Summons must therefore be rejected. The Summons therefore fails and is dismissed with costs.” 42. In the said case the claimants, asserted that the company exercised control and also obliged them to comply and follow the instructions given by the company from time to time.
The claim made by the applicants in the Summons must therefore be rejected. The Summons therefore fails and is dismissed with costs.” 42. In the said case the claimants, asserted that the company exercised control and also obliged them to comply and follow the instructions given by the company from time to time. While dealing with the said contention in light of the terms of the agreement, the Court observed that the clauses 3, 4 and 17 merely set out what was implicit in the relationship of principal and agent and lay down certain restriction on the right of agent and safeguards for the principal and that the clause 3 was incorporated for the purpose of avoiding any confusion for misunderstanding and clause 4 merely recognized the right of principal to prescribe terms and condition of the sale. The Court observed that the said provisions were, in no way, inconsistent with the relationship of principal and agent. The Court also emphasized that under the contract of agency the agent must necessarily act according to the instruction of the principal. It is pertinent that though the agreement in question conferred right in favour of the claimants to sell the clothes manufactured by the company it reserved the right to the company to create other agency for defined territory. On reading the agreement the Court held that the provisions led to the conclusion that the contract created sole selling agency and the relationship was of principal and agent. 43. Above quoted observations in the decision in case of Balwant Rai Saluja, Workman of Nilgiri Co-operative Society, International Airport Authority, Swadeshi Mills support and fortify the decision of this Court that the claim and contention by the petitioners – booth operators are not sustainable and learned Tribunal has not committed any error in rejecting the said clam and contentions and in passing final award. The award does not suffer from any infirmity and does not warrant any interference and there is no justification to disturb the award. The petitioner has failed to make out any case against the award and to convince this Court that the award is incorrect and contrary to legal position decided by precedents and perverse and it deserves to be set aside. The award does not suffer from any infirmity. The petition fails and deserves to be rejected and is accordingly hereby rejected. 44.
The award does not suffer from any infirmity. The petition fails and deserves to be rejected and is accordingly hereby rejected. 44. So far as other petition i.e. Special Civil Application No. 6497 of 1993 is concerned, in the said petition the booth operator has challenged award dated 17.2.1993 in Reference No. 200 of 1980 (old no. 121 of 1974). The said reference case came to be rejected on the same ground i.e. booth operator cannot be considered workman within the meaning of the terms workman under Section 2(s) of the Act. 45. In light of foregoing discussion with regard to award in reference No. 684 of 1989, the challenge against award dated 17.2.1993 in Reference No. 200 of 1980 (old no. 121 of 1974) which challenged in Special Civil Application No. 6497 of 1993, fails. Therefore said petition also fails and it deserves to be rejected. Accordingly both the petitions are disposed of. Rule discharged. Ad-interim/interim relief, if any, stands vacated forthwith. Petitions dismissed.