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2020 DIGILAW 102 (AP)

KCP Cement Limited v. State of Andhra Pradesh

2020-02-07

T.RAJANI

body2020
JUDGMENT : T. Rajani, J. Challenging the order dated 24.01.2018, passed in I.A.No.103 of 2015 in I.D.No.117 of 2011, refusing to decide the preliminary issues raised by the petitioner as to the jurisdiction of the court in entertaining the reference at the instance of the 1st respondent, in the foremost, this writ petition is filed. 2. The petitioner company is engaged in manufacturing of cement and has a plant at Macherla, Guntur District. The petitioner Company inter alia engages workmen for the core activities and entrusts the intermediate works to licensed contractors, who engage their own contract labour for executing such works based on the need and necessity of such work and one of such licensed contractor has engaged the 3rd respondent's union contract labourers for different kinds of intermediate works. The petitioner is not responsible for any supervision of such contract labourers. While things stood thus, the 3rd respondent Union represented by one M.Suresh Babu has demanded for regularising 38 contract labourers of such union and absorb their services in the petitioner's factory with all consequential benefits. But the said contract labourers are working under a licensed contractor and the activities of the said labourers do not fall under the category of core activities and they have no right to demand such regularization. Upon the representation given on behalf of the petitioner on 21.09.2010, joint meetings were held. A writ petition was filed in W.P.No.28614 of 2010 before this court seeking regularization and this court vide order, dated 14.06.2011, allowed the writ petition by directing the 1st respondent to take appropriate decision as to whether it is a fit case to refer the dispute to the Labour Court. In pursuance of the above order, the Joint Labour Commissioner took up the matter for conciliation and submitted the failure report to the Commissioner of Labour, Hyderabad. Then the said dispute was referred to the 2nd respondent and the same was registered as I.D.No.117 of 2011. The petitioner, after receiving notice form the 2nd respondent filed I.A.No.55 of 2015 in the said ID raising preliminary objections on maintainability and to decide the same as preliminary issue. The petitioner later withdrew the IA with permission of the court and filed I.A.No.103 of 2015 raising the specific ground with regard to the maintainability. 3. The petitioner, after receiving notice form the 2nd respondent filed I.A.No.55 of 2015 in the said ID raising preliminary objections on maintainability and to decide the same as preliminary issue. The petitioner later withdrew the IA with permission of the court and filed I.A.No.103 of 2015 raising the specific ground with regard to the maintainability. 3. The counter filed by the 3rd respondent denies the contentions made in the petition contending that there is no provision in Industrial Dispute Act to frame a particular issue as a preliminary issue. The Dispute was of the year 2011. IA seeking for decisions on the preliminary issue is filed in the year 2015 after the petitioner filed their counter in I.A.No.117 of 2011. On the above grounds, the 3rd respondent seeks to dismiss the petition. 4. Heard Sri Challa Gunaranjan, learned counsel for the petitioner; learned Government Pleader for Labour appearing for respondents 1 and 2; Sri M.Pitchaiah, learned counsel appearing for respondent No.3. 5. By virtue of the impugned order, the Presiding Officer Labour Court, Guntur, dismissed the interlocutory application, holding that the grounds mentioned in the petition seeking adjudication on the preliminary issues on the aspect of non-existence of respondent-Union on the date of representation to the petitioner Management as well as to the Joint Commissioner of Labour on account of the alleged cancellation of respondent Union on 11.08.2010 due to the non-submission of annual returns to the Registrar of Trade Union, Guntur, and locus standi of practicing Advocate one M.Suresh Babu, to raise the Industrial dispute in the name of alleged non existing union and thereby absence of proper legal and valid espousal and dispute regard to the relationship of employee and employer between the 38 workmen and the petitioner management, can be decided after full length trial. 6. The counsel for the petitioner makes three fold argument. One is with regard to there being no employer-employee relationship between the petitioner and the respondents; the next being that the Union, which espoused the cause of the petitioner, is not a registered Union since its registration has been cancelled; and the last contention is that it is the Central Government, who has to make reference and not the State Government as was done in this case. 7. 7. As regards the first contention, the submission is that the workmen engaged by the petitioner company are contract workmen, since they are employed through a contractor and that there is no employer-employee relationship between the petitioner and the respondents. The counsel for the respondents contends that whether the persons engaged by the petitioner are workmen or not is a question of fact, since their appointment as contract workers is a camouflage. He relies on the judgment of the Supreme Court STEEL AUTHORITY OF INDIA LT. V.N.U.WATER FRONT WORKERS, (2001) LabIC 3656, in support of the said contention. The Apex Court referred to three judge bench decision in HUSSAINBHAI V. ALATH FACTORY THEZHILALI UNION, KOZHIKODE, (1978) AIR SC 1410 wherein the petitioner was manufacturing ropes entrusted the work to the contractors who engaged their own workers. When after some time when the workers were not engaged, they raised an industrial dispute. It went to Supreme Court which held that though there was no direct relationship between the petitioner and the respondent, yet on lifting the veil and looking at the conspectus of the factors governing employment, the naked truth though draped in different perfect paper arrangement, was that the real employer was the management not the immediate contractor. Speaking for the Court, Justice Krishna Iyer observed thus: Myriad devices, half-hidden in fold after fold of legal form depending on the degree of concealment needed, the type of industry, the local conditions and the like may be resorted to when labour legislation casts welfare obligations on the real employer, based on Arts.38, 39, 41, 43 and 43A of the Constitution. The Court must be astute to avoid mischief and achieve the purpose of the law and not be misled by the maya of legal appearances. 8. Hence the above observations and findings would force a court not to go by the nomenclature of the nature of employment, but to probe into the matter to understand the real nature of employment. The court has to lift the veil and look into the terms of employment and should not be carried away by the nomenclature given to the respondents as contract workers. Thus, it becomes a fact in issue, which cannot be decided as a preliminary issue. 9. The court has to lift the veil and look into the terms of employment and should not be carried away by the nomenclature given to the respondents as contract workers. Thus, it becomes a fact in issue, which cannot be decided as a preliminary issue. 9. As regards, the Union that has espoused the cause of the respondent-workmen, the petitioner's counsel draws the attention of this court to the letter bearing Lr.No.A/2678/2015, dated 24.09.2015, issued by the Deputy Commissioner of Labour to the General Manager, KCP Limited, Macherla, wherein the registration of the Union was cancelled for non submission of annual returns. The respondent's counsel contends that even an unregistered Union can espouse the cause. 10. The ruling of the Andhra High Court reported in ABDUL LATEEF AND ANOTHER VS. COROMANDEL FERTILIZERS decided on 01.05.2015 in Writ Appeal No.998 of 2007, supports the submission of the counsel for the respondents. The Andhra High Court held that an unregistered Union also can espouse the cause of workmen, though the emphasis was on the espousal being mandatory. The ruling of the Supreme Court NEWS PAPERS LIMITED, ALLAHABAD AND STATE INDUSTRIAL TRIBUNAL, UP AND OTHERS, (1960) 2 LLJ 37 SC provides a complete answer for the said question, wherein it was held that an unregistered Union can espouse the cause of workmen. Hence, this court need not be stopped any further from dismissing the point raised by the petitioner's counsel as unmerited. 11. As regards, the Labour Court accepting the reference, which is made by the Central Government, the counsel himself fairly draws the attention of this court to the notification issued by the Government of India, Ministry of Labour, whereby the Central Government has delegated its power of espousal to the State Government. 11. As regards, the Labour Court accepting the reference, which is made by the Central Government, the counsel himself fairly draws the attention of this court to the notification issued by the Government of India, Ministry of Labour, whereby the Central Government has delegated its power of espousal to the State Government. The said notification can be extracted for better understanding: GOVERNMENT OF INDIA Ministry Of Labour Dated New Delhi the 8th Dec 17 NOTIFICATION S.O. : In exercise of the powers conferred by Section 39 of the Industrial Disputes Act, 1947, (14 of 1947), the Central Government hereby directs that all the powers exercisable by it under that Act and the rules made thereunder shall, in relation to the Cement Industry be exercised also by all the State Government subject to the condition that the Central Government shall continue to exercise all the powers under the said Act and Rules made thereunder - (i) relating to mines and quarries even where such mines and quarries form part of the Cement Industry; and (ii) relating to the dispute between the employers who are member of the Cement Manufacturers Association, Express Building, Churchgate, Bombay and their workmen represented by Indian National Cement and Allied Workers; Federation Mazdour Karyalaya, Congress House, Bombay, which has born referred for arbitration in pursuance of Section 10A of the said Act read with notification No.S.O.757-E dated 8.11.1997(No.S.11028/9/77/DI.(A), in terms of the arbitration agreement published by the notification of the Government of India is the Ministry of Labour Order No.... dated the 28th November, 1977. Sd/- X X X (D.Bandyopadhyay) Joint Secretary No.S.11085/9/77/DI(A) 8.12.77. No.98/4/ Forwarded to FOs in Hyderabad Region for information. RLC (C): HYDERABAD. 12. But the contention is that the said delegated powers can be exercised by the State Government only in case of workmen and not in case of contract workers. The answer to this contention already comes from the discussion made on the first contention, that there is no employer-employee relationship between the petitioner and the respondents. “12. The counsel for the petitioner, on the point of deciding the issues raised by the petitioner as preliminary issue relies on the judgment of the Supreme Court D.P.MAHESHWARI V. DELHI ADMINISTRATION, (1983) 4 SCC 293 . The Supreme Court took cognizance of the unbecoming devices adopted by certain employees to avoid decision of the industrial disputes on merits. “12. The counsel for the petitioner, on the point of deciding the issues raised by the petitioner as preliminary issue relies on the judgment of the Supreme Court D.P.MAHESHWARI V. DELHI ADMINISTRATION, (1983) 4 SCC 293 . The Supreme Court took cognizance of the unbecoming devices adopted by certain employees to avoid decision of the industrial disputes on merits. It observed that they would raise various preliminary objections, invite decision on those objections in the first instance, carry the matter to the High Court under Article 226 of the Constitution and to the Supreme Court under Article 136 of the Constitution and delay a decision of the real dispute for years, sometimes for over a decade. Industrial peace, one presumes, hangs in the balance. It also observed that there was a time when it was thought prudent and wise policy to decide preliminary issues first. But the time appears to have arrived for a reversal of that policy. It also observed that it is better that tribunals, particularly those entrusted with the task of adjudicating labour disputes where delay may lead to misery and jeoparidse industrial peace, should decide all issues in dispute at the same time without trying some of them as preliminary issues. 13. Hence, in the interest of speedy disposal and considering that the issue of employer and employee relationship, which is the centre point of the other issues, need to be adjudicated after allowing evidence, this court approves the approach of the labour court in dismissing the petition, which was filed seeking to decide the issues raised by the petitioner as preliminary issues and consequently, this writ petition is liable to be dismissed. 14. With the above observations, the Writ Petition is dismissed. As a sequel, the miscellaneous applications pending, if any, shall stand closed.