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NAGAR MAHAPALIKA versus LABOUR COURT

High Court of Judicature at Allahabad

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Nagar Mahapalika v. Labour Court - WRIT - C No. 3836 of 1984 [2003] RD-AH 403 (24 October 2003)

 

This is an UNCERTIFIED copy for information/reference. For authentic copy please refer to certified copy only. In case of any mistake, please bring it to the notice of Joint Registrar(Copying).

HIGH COURT OF JUDICATURE OF ALLAHABAD

Reserved

Civil Misc. Writ Petition No. 3836 of  1984

Nagar Mahapalika, Allahabad v.  Labour Court, U.P., Allahabad & others

Hon'ble R.K.Agrawal, J.

By means of the present writ petition filed under Article 226 of the Constitution of India the petitioner Nagar Mahapalika, Allahabad through its Administrator seek a writ, order or direction in the nature of certiorari quashing the award of the Labour Court, Allahabad, dated 10th October, 1983, filed as Annexure 11 to the writ petition, passed in Adjudication Case No.118 of 1982 (published on 29th November, 1983) and other consequential reliefs.

Briefly stated, the facts giving rise to the present petition are as follows:-

The Officiating Mukhya Nagar Adhikari, Nagar Mahapalika, Allahabad appointed Arun Kumar Srivastava, respondent no.3, as a temporary Tax Inspector for a period of one year.  The appointment was made on 19th February, 1974 under Section 108 of the Nagar Mahapalika Adhiniyam, 1958, hereinafter referred to as ''the Adhiniyam'.  By means of letter dated 13th February, 1975 the services of respondent no.3 was terminated.  The respondent no.3 made a representation to the Administrator, Nagar Mahapalika, Allahabad against the order of termination dated 13th February, 1975, which was rejected vide order dated 27th February, 1975.  However, in the year 1980, the respondent no.3 made an application before the Conciliation Officer, Allahabad. Since the parties could not arrive at any settlement before the Conciliation Officer, a report was submitted to the State Government who made a reference to the Labour Court for adjudication.  The following dispute was referred for adjudication:-

"KYA SEWAYOJAKON DWARA APNE SHRAMIK ARUN SRIVASTAVA {PUTRA SHREE GANGA PRASAD SRIVASTAVA} KO DINANK 13/2/75 SE KARYA SE PRITHAK/VANCHIT KIYA JANA UCHIT TATHA/ATHAVA VAIDHANIK HAI ? YADI HAN, TO SAMBANDHIT SHRAMIK KYA LABH/ANUTOSH {RELIEF} PANE KA ADHIKARI HAI KIS ANYA VIVARAN SAHIT ?"

The reference was registered as Adjudication Case No.118 of 1982.  According to the petitioner, it had not received any notice from the Labour Court, Allahabad regarding the adjudication case and, therefore, no appearance was put before it.  On inspection of the file of the Labour Court by the petitioner, it transpired that the Labour Court had taken the matter on 20th September, 1982 on which date the respondent no.3 was present, who filed his written statement and the letter of authority.  Since no one had appeared on behalf of the petitioner nor any written statement had been field, the Labour Court fixed 5th December, 1982 for ex parte hearing.  Thereafter a notice dated 9th November, 1982 was sent to the petitioner informing the next date fixed in the matter as 3rd December, 1982.  On that date an application along with an affidavit was filed on behalf of the petitioner through the Legal Advisor (Law Officer) stating that prior to the notice dated 9th November, 1982 no notice whatsoever had been served, therefore, the order for proceeding ex parte be set aside and the petitioner be given an opportunity of hearing.  The Labour Court vide order dated 4th January, 1983 allowed the petitioner to participate in the proceedings from that stage and fixed 11th January, 1983 as the next date.  On 11th January, 1983 an application was filed on behalf of the petitioner with a prayer to accept the written statement.  The said application was filed on the ground that prior to the notice dated 9th November, 1982 no notice was received in the Office of Nagar Mahapalika, Allahabad and since it is a statutory corporation, a notice is required to be effected through the Administrator as per the provisions of Order XXIX Rule 2 of the Code of Civil Procedure, 1908. The Labour Court vide order of the same date rejected the application on the ground that the application for setting aside ex parte proceedings has been rejected. Thereafter certain proceedings took place. No oral evidence was led before the Labour Court.  It gave an award on 10th October, 1983, which was published on 29th November, 1983.  By means of the said award the Labour Court had directed the petitioner to reinstate the respondent no.3 with payment of his wages and salary with effect from 13th February, 1975 on the ground that he had worked for 240 days and, therefore, Nagar Mahapalika, Allahabad was required to follow the procedure laid down under Section 6-N of the U.P. Industrial Disputes Act,1947, hereinafter referred to as ''the U.P.Act', which in the present case has not been followed and, therefore, the order of termination is illegal.

I have heard Sri Ashok Mohiley, learned counsel for the petitioner and Sri T.P. Singh, Senior Counsel, assisted by Sri Anil Bhushan for the respondent.

Learned counsel for the petitioner submitted that the respondent no.3 was appointed as a Tax Inspector on temporary basis in the prescribed pay scale under Section 108 of the Nagar Mahapalika Adhiniyam, hereinafter referred to as "the Adhiniyam" for a period of one year only by the officiating Mukhya Nagar Adhikari.  In the appointment letter it was specifically mentioned that the services could be terminated without any notice.  According to him, since the appointment was for a fixed period of one year which would have come to an end on 18th February, 1974, the Labour Court was not justified in granting reinstatement of service with full back wages.  He submitted that the appointment on the post of the Tax Inspector can only be made after consultation with the Selection Committee as required under Section 107 of the Adhiniyam.  He relied upon an unreported decision of the Hon'ble Supreme Court in the case of U.P. State Road Transport Corporation, Allahabad v. Parsu Ram Mishra (Civil Appeal No.3854 of 1988, decided on 1st November, 1988) wherein the Hon'ble Supreme Court held that if the appointment itself was for a temporary duration and the tenure expired on 31st December, 1976, the High Court could not have passed the order under appeal going beyond the date of expiry of his tenure nor an order to absorb him as a regular employee could have been lawfully passed as he was never a regular employee.  He also relied upon a recent decision of the Hon'ble Supreme Court in the case of Dr. (Mrs.) Chanchal Goyal v. State of Rajasthan, JT 2003 (5) SC 144 wherein the Hon'ble Supreme Court has held that there is no scope of regularization unless the appointment was on regular basis. He further submitted that the appointment of the respondent no.3 was not made after the consultation with the Selection Committee.  On the other hand it was made under Section 108 of the Adhiniyam, which empowers the petitioner to make an appointment for a period not exceeding one year.  Thus, he could not have continued in service beyond one year.

He relied upon the following decisions:-

(1) Pyare Lal Pandey v. Commissioner, Allahabad Division and others, 1986 UPLBEC 676;

(2) The State of Punjab v. Jagdip Singh and others, AIR 1964 SC 521;

(3) Arya Kanya Pathashala and another v. Smt. Manorama Devi Agnihotri, 1971 ALJ 983; and

(4) State of U.P.  v. Presiding Officer, Labour Court, II, Meerut and another, (2003) 1 SAC 693.

He further submitted that the Labour Court had committed an error of law in proceeding ex parte as no notice prior to 9th November, 1982 was served upon the petitioner and, therefore, denying the petitioner its right to file written statement, has resulted in gross failure of justice.  According to him, the petitioner has its own set of rules governing the service conditions of its employees, which are statutory in nature and, therefore, the provisions of the U.P.Act stand excluded.  Thus, the Labour Court had no jurisdiction to hear and decide the reference even if it has been made by the State Government.  He relied upon the following decisions:-

(1) Mahant Kaushalya Das v. State of Madras, AIR 1966 SC 22;

(2) Director of Postal Services (South), Kerala Circle, Trivandrum and another v. K.R.B. Kaimal and another, 1984 LAB.I.C. 628; and

(3) State of Rajasthan v. Gopi Kishan Sen, AIR 1992 SC 1754

Without prejudice to the above, Sri Mohiley submitted that in case it is held that the provisions of the Industrial Disputes Act are applicable in the case of the petitioner also, since the respondent no.3 has not worked for one calendar year, he having been appointed on 19th November, 1974 and terminated on 13th February, 1975, the provisions of retrenchment under Section 6-N of the U.P. Act would not be applicable.  According to him, Section 2(g) of the U.P. Act defines continuous service as follows:-

"2(g) "Continuous service' means uninterrupted service, and includes service which may be interrupted merely on account of sickness or authorized leave or an accident or a strike which is not illegal, or a lock-out or a cessation of work which is not due to any fault on the part of the workman, and a workman, who during a period of twelve calendar months has actually worked in an industry for not less than two hundred and forty days shall be deemed to have completed one year of continuous service in the industry.

EXPLANATION:-   In computing the number of days on which a workman has actually worked in an industry, the days on which :-

(i) he has been laid off under the agreement or as permitted by standing order made under the Industrial Employment (Standing Orders) Act, 1946, or under this Act any other law applicable to the industrial establishment, the largest number of days during which he has been so laid off being taken into account for the purposes of this clause,

(ii) he has been on leave with full wages, earned in the previous year, and

(iii) in the case of a female she has been on maternity leave; so however, that the total period of such maternity leave shall not exceed twelve weeks,

shall be included."

Section 6-N of the U.P. Act prescribes the conditions precedent, which are to be complied with before a workman is retrenched, which reads as follows:-

"6-N. Conditions precedent to retrenchment of workmen- No workmen employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until:-

(a) the workmen has been given one month's notice in writing indicating the reasons for retrenchment and the period  of notice has expired or the workman has been paid in lieu of such notice wages for the period of the notice:

Provided that no such notice shall be necessary if the retrenchment is under an agreement which specifies a date for the termination of service;

(b) the workmen has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days' average pay for every completed year of service or any part thereof in excess of six months, and

(c) notice in the prescribed manner is served on the State Government."

These provisions are analogous to Section 2(eee) and Section 25-B as inserted in the Industrial Disputes Act, 1947, hereinafter referred to as ''the Central Act' by the Industrial Disputes (Amendment) Act, 1953. Section 2(eee) of the Central Act defines ''continuous service' as follows:-

"2(eee)   ''continuous service' means uninterrupted service and includes service which may be interrupted merely on account of sickness or authorized leave or an accident or a strike which is not illegal, or a lock out or a cessation of work which is not due to any fault on the part of the workman"

Section 25-B of the Central Act defines ''one year of continuous service' as follows:-

"25-B. Definition of continuous service. - For the purposes of this Chapter, --

(1) a workman shall be said to be in continuous service for a period if he is, for that period, in uninterrupted service, including service which may be interrupted on account of sickness or authorized leave or an accident or a strike which is not illegal, or a lock-out or a cessation of work which is not due to any fault on the part of the workman;

(2) where a workman is not in continuous service within the meaning of clause (1) for a period of one year or six months, he shall be deemed to be in continuous service under an employer -

(a) for a period of one year, if the workman, during a period of twelve calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than -

(i) one hundred and ninety days in the case of a workman employed below ground in a mine; and

(ii) two hundred and forty days, in any other case;

(b) for a period of six months, if the workman, during the period of six calendar months preceding the date with reference to which calculation is to be made, has actually worked under the employer for not less than -

(i) ninety-five days in the case of a workman employed below ground in a mine; and

(ii) one hundred and twenty days, in any other case.

Explanation. - For the purposes of clause (2) the number of days on which a workman has actually worked under an employer shall include the days on which -

(i) he has been laid off under an agreement or as permitted by standing orders made under the Industrial Employment (Standing Orders) Act, 1946 (20 of 1946), or under this Act or under any other law applicable to the industrial establishment;

(ii) he has been on leave with full wages, earned in the previous year;

(iii) he has been absent due to temporary disablement caused by accident arising out of and in the course of his employment; and

(iv) in the case of a female, she has been on maternity leave; so however, that the total period of such maternity leave does not exceed twelve weeks."

Section 25-F of the Central Act prescribes conditions precedents to retrenchment, which reads as follows:-

"25-F. Conditions precedent to retrenchment of workmen.-- No workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until -

(a) the workman has been given one month's notice in writing indicating the reasons for retrenchment and the period of notice has expired, or the workman has been paid in lieu of such notice, wages for the period of the notice;

(b) the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to fifteen days' average pay for every completed year of continuous service or any part thereof in excess of six months; and

(c) notice in the prescribed manner is served on the appropriate Government or such authority as may be specified by the appropriate Government by notification in the Official Gazette."

According to Sri Mohiley, the aforesaid provisions of the Central Act came up for consideration before the Hon'ble Supreme Court in the case of Sur Enamel & Stamping Works Ltd. Vs. The Workmen, AIR 1963 SC 1914 wherein the Hon'ble Supreme Court has held that for calculating 240 days in a year a workman has to necessarily show to have worked for twelve calendar months, i.e., a complete year and not 240 days in a tenure of employment if it is less than one year. Paragraph 8 of the judgment is reproduced below:-

"8.On the plain terms of section only a workman who has been in continuous service for not less than one year under an employer is entitled to its benefit. "Continuous service" is defined in S.2(eee) as meaning uninterrupted service and includes service which may be interrupted merely on account of sickness or authorized leave or an accident or a strike which is not illegal, or a lock out or a cessation of work which is not due to any fault on the part of the workman. What is meant by ''one year of continuous service' has been defined in S.25-B. Under this section a workman who during a period of twelve calendar months has actually worked in an industry for not less than 240 days shall be deemed to have completed one year of completed service in the industry. Nagen Bora and Monoharan were both reappointed on 10th March 1959. Their services were terminated on 15th January 1960. Thus, their total period of employment was less than 11 months. It is not disputed that period of their former employment under the company prior to their reappointment on 10th March 1959 cannot be taken into consideration in computing the period of one year, because it is common ground that their reappointment on 10th March 1959 was a fresh appointment. The position therefore is that during a period of employment for less than 11 calendar months these two persons worked for more than 240 days. In our opinion that would not satisfy the requirement of  S.25-B. Before a workman can be considered to have completed one year of continuous service in an industry it must be shown first that he was employed for a period of not less than 12 calendar months and, next that during those 12 calendar months had worked for not less than 240 days. Where, as in the present case, the workmen have not at all been employed for a period of 12 calendar months it becomes necessary to examine whether the actual days of work numbered 240 days or more. For, in any case, the requirements of S.25-B would not be satisfied by the mere fact of the number of working days being not less than 240 days."

The aforesaid decision has been followed by the Hon'ble Supreme Court in the case of Shri Mohan Lal v. Management of M/s Bharat Electronics Ltd., 1981 (42) FLR 389.  

Further, in 1964, by the Central Amendment Act, 1964, Section 2(eee) has been deleted and Section 25-B was amended.  No corresponding change was made in Section 2(g) of the U.P. Act and, therefore, the interpretation given by the Hon'ble Supreme Court in the case of Sur Enamel & Stamping Works Limited  (supra) still holds good so far as the State of U.P. is concerned.  Thus, he submitted that the provisions of Section 6-N of the U.P. Act would not be attracted as the respondent no.3 had not worked for full one calendar year, i.e., twelve months.

He further submitted that the respondent no.3 cannot take the benefit of the interim order passed by this Court pursuant to which he was allowed to continue in service.  He relied upon a decision of the Hon'ble Supreme Court in the case of N.Mohanan v. State of Kerala and others,  (1997) 2 SCC 556 = 1997 SCC (L& S) 745.

Sri T.P. Singh, learned Senior Counsel, submitted that the respondent no.3 even though had been appointed initially for a period of one year on temporary basis but the post was a substantive post.  His services had been arbitrarily terminated even before the expiry of one year, i.e., on 13th February, 1975. He had worked for more than 240 days in a year and, therefore, the order of termination, without following the procedure prescribed in Section 6-N of the U.P Act, is illegal and has rightly been held to be void by the Labour Court.  Once the order of termination is void, the respondent no.3 is entitled for reinstatement with back wages. He further submitted that the petitioner did not put in appearance in spite of the notices having been served, therefore, the Labour Court had directed to proceed ex parte. The Labour Court on the material available on record had come to the conclusion that the services of respondent no.3 had been terminated without following the due procedure as prescribed under Section 6-N of the U.P. Act, which calls for no interference in exercise of powers under Articles 226/227 of the Constitution of India.

He further submitted that the Hon'ble Supreme Court in the case of General Manager, Telecom v. A. Srinivasa Rao and others, 1998 SCC (L&S) 6 has followed the seven Judges' Bench decision in the Bangalore Water Supply and Sewerage Board v. A. Rajappa, (1978) 2 SCC 213 wherein the dominant nature test for deciding whether the establishment is an ''industry' or not, had been summarized and the Hon'ble Supreme Court had held that the Telecom Department of the Union of India is an industry.  According to him, the Nagar Mahapalika, Allahabad is also an industry.  So far as the question as to whether the workman has to work for a full one year, i.e., twelve calendar months, before claiming the benefit of Section 6-N of the U.P. Act is concerned, he submitted that even though Section 2(g) of the U.P. Act has not been amended in the light of the 1964 amendment made in Section 25-B of the Central Act, the provisions of the Central Act will prevail and, therefore, it is not necessary that a workman should have worked for a full one year before claiming the benefit of Section 6-N of the U.P. Act. It is sufficient if the workman shows that he has worked two hundred and forty days in a year preceding his retrenchment. He relied upon a five Judges' Bench decision of this Court in the case of Hindustan Sugar Mills Ltd. v. State of U.P. and others (Writ Petition No.1910 of 1981, decided on 20th May 1998).  He also relied upon the decision of this Court in the case of U.P. Industrial Co-operative Association Ltd. v. The Presiding Officer, Labour Court-I, Kanpur and others, 1996 (72) FLR 505.  He further submitted that the Industrial Disputes Act would apply in the present case. He relied upon a decision of this Court in the case of Jai Kishun and others v. U.P. Co-operative Bank Ltd., Lucknow and others, (1989) 2 UPLBEC 144.

According to Sri Singh, if the retrenchment has been made without complying with the provisions of Section 6-N of the U.P.Act, the same is void and inoperative, therefore, the respondent no.3 would be deemed to be in continuous service and it follows that the workman concerned continues to be in service with all consequential benefits.  He relied upon the decision of the Hon'ble Supreme Court in the cases of Shri Mohan Lal v. Management of M/s Bharat Electronics Ltd., 1981 (42) FLR 389; State Bank of India v. N. Sundra Money, 1976(32) F.L.R. 197 and Hindustan Steel Ltd. V. State of Orissa and others, 1976(33) FLR 257.

He further submitted that, according to Section 6-R of the U.P.Act, the provisions of Section 6-J to 6-Q shall have effect notwithstanding anything inconsistent therewith contained in any other law.  Thus, if Section 108 of the Adhiniyam is interpreted to mean to curtail or restrict the play of Section 6-N of the U.P.Act, in that even Section 108 will be contrary and has to give way to Section 6-N of the U.P. Act.  Thus, Section 108 cannot come in the way of respondent no.3 in getting the benefit of 6-N and all other consequential benefits.  The liabilities of the employers cannot be soften or ignored by any other provisions of law including  Section 108 of the Adhiniyam.  He relied upon the decision in the case of Micro Abrasives (India) Limited, Dhampur, District Bijnore v. Dhanvir Singh and another, (2001) 1 UPLBEC 669.

So far as the submission of Sri Mohiley that the appointment of respondent no.3 will automatically come to an end after the expiry of one year in view of the Section 108 of the Adhiniyam or in accordance with the terms of appointment of workman is concerned, Sri Singh submitted that the submission is misconceived.  According to him, the services of respondent no.3 cannot come to an end after the expiry of one year unless it is validly retrenched in accordance with the provisions of Section 6-N of the U.P. Act.  According to him, on account of continuous service of respondent no.3 for more than two hundred forty days in twelve calendar months, the respondent no.3 has acquired rights under the provisions of the U.P.Act.  The termination order dated 13th February, 1975 being void, the respondent no.3 continues in service with all consequential benefits. He submitted that Section 108 of the Adhiniyam cannot have effect of termination of services on expiry of one year since in between rights' of protection under Section 6-N have intervened and in any conflict of rights under Section 108 of the Adhiniyam and Section 6-N of the U.P. Act, Section 108 has to give way to Section 6-N.  Without prejudice to the aforesaid he submitted that the respondent no.3 had been reinstated on 4.10.1985 in pursuance of the award and the order dated 4.10.1985 passed by this Court and since then he is continuously working and discharging his duties.  He has reached the age of 46 years having huge family to look after consisting of widowed mother aged about 70 years, wife, two sons and one daughter.  On account of his continuous working for about 18 years he is entitled to be absorbed and regularized in service.  He invoked the equitable jurisdiction of this Court and relied upon the following decisions:-

1. District Collector & Chairman, Vizianagaram Social Selfare Residential School Society, Vizianagaram and another v. M. Tripura Sundari Devi, 1990(3) SCC 655 and

2. Rekha Chaturvedi (Smt.) v. University of Rajasthan and others, 1993 Supp.(3) SCC 168

Having heard the learned counsel for the parties, I find that Section 2(g) of the U.P.Act provides that a workman who during a period of twelve calendar months has actually worked in an industry for not less than two hundred and forty days shall be deemed to have completed one year of continuous service in the industry.  Section 6-N of the U.P.Act, which provides for conditions precedent to the retrenchment of workmen, specifically provides that no workman employed in any industry who has been in continuous service for not less than one year under an employer shall be retrenched by that employer until one month's notice in writing is given or workman has been paid in lieu of such notice wages for the period of notice and retrenchment compensation. Thus, the provisions were analogous to Sections 2(eee), 25-B and 25-F of the Central Act, as it stood prior to the 1964 Amendment. By way of the Amendment in 1964, the provisions of Section 2(eee) of the Central was deleted and amendment was made in Section 25-B of the Central Act. Corresponding amendment was not made in the U.P.Act. The provisions of Sections 2(eee) and 25-B were considered by the Hon'ble Supreme Court in the case of Sur Enamel & Stamping Works Limited (supra) and the Hon'ble Supreme Court had held that for qualifying one year of continuous service it is incumbent upon the workman to have worked 12 calendar months and for 240 days during that period.  If a workman had not worked for 12 calendar months even though he may have worked for 240 days, he will not be treated to have worked for one continuous year. This view was reiterated by the Hon'ble Supreme Court in the case of Shri Mohan Lal (supra). However, the Hon'ble Supreme Court held that, in view of the amendment in the year 1964, the position has changed and now it is not required that a workman should have actually worked for 12 calendar months. In fact, if he had worked for 240 days in a year prior to the date of retrenchment, he would be treated to have worked in continuous service for one year. The question is as to whether without there being corresponding amendment in Section 2(g) of the U.P.Act, a workman who has not worked for full 12 calendar months but has actually worked for 240 days in a year prior to the date of retrenchment, is said to have worked for one year of continuous service or not.  A Full Bench of the five Judges in the case of Hindustan Sugar Mills (supra) has held that the law relating to the industrial dispute contained in Section 2(g) of the U.P.Act is different from the law contained in Section 25-B of the Central Act. Both the laws have been legislated in respect to the matter enumerated in Entry 22 of the Concurrent List.  The State Act can prevail only if it has been made subsequent to the Parliamentary legislation containing repugnant provisions and has been enacted after obtaining the assent of the President. The State law having been enacted earlier, the exception provided by clause (2) of Article 254 will not operate in this case and the Central Act would prevail.

A similar view was taken by this Court in the case of U.P.Industrial Cooperative Association Limited (supra). This Court has held that Section 2(g) of the U.P.Act stands impliedly repealed to the extent it is inconsistent with Section 25-B(2) of the Central Act and the predominance which the U.P.Act has by virtue of Section 6-R(2) over the Central Act in respect of determination of the rights and liabilities of the employer and the workman, will make no difference. It may be noticed that Section 2(g) falls outside the periphery of Section 6-J to 6-Q which provisions alone, according to Section 6-R(1) of the U.P.Act, have been imparted predominance over "anything inconsistent therewith contained in any other law" and not the definition of "continuous service". Respectfully following the Full Bench decision in the case of Hindustan Sugar Mills (supra) it is held that provisions of Section 25-B(2) of the Central Act would be applicable for the purposes of determination of continuous service and not the provisions of Section 2(g) of the U.P.Act.

So far as the question as to whether the Nagar Mahapalika, Allahabad can be said to be an industry or not and as to whether the provisions of the U.P. Act are applicable or not, it may be mentioned here that the Hon'ble Supreme Court in the case of Bangalore Water Supply Case (supra), in paragraph 143 of the judgment, had summarized the dominant nature test for deciding whether the establishment  is an industry or not.  The dominant nature test as summarized by the Hon'ble Supreme Court is reproduced below:-

"143.The dominant nature test:

(a) Where a complex of activities, some of which qualify for exemption, others not, involves employees on the total undertaking, some of whom are not ''workmen' as in the University of Delhi case or some departments are not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the departments as explained in the Corpn. Of  Nagpur will be the true test.  The whole undertaking will be ''industry' although those who are not ''workmen' by definition may not benefit by the status.

(b) Notwithstanding the previous clauses, sovereign functions, strictly understood, (alone) qualify for exemption, not the welfare activities or economic adventures undertaken by government or statutory bodies.

(c) Even in departments discharging sovereign functions, if there are units which are industries and they are substantially severable, then they can be considered to come within Section 2(j)

(d) Constitutional and competently enacted legislative provisions may well remove from the scope of the Act categories which otherwise may be covered thereby."

The aforesaid decisions have been followed by the Supreme Court in the case of General Manager, Telecom (supra) wherein the Hon'ble Supreme Court has held that Telecom Department of the Union of India is an industry. Applying the dominant nature test to the fact of the present case, I find that the present case falls under clause (b) of the test laid down by the Hon'ble Supreme Court as the welfare activities  or economic adventures undertaken by government or statutory bodies do not qualify for exemption.  Thus, the petitioner being an industry, the provisions of U.P. Act are applicable.

So far as the question as to whether the Labour Court was justified in proceeding to adjudicate the dispute ex parte or not, it may be mentioned here that it is the specific case of the petitioner that no notice fixing 20th September, 1982 had been served upon it.  The only notice which has been received by it is the notice dated 9th November, 1982.  After its receipt, the petitioner had immediately filed an application on which the Labour Court fixed 3rd December, 1982 informing the Labour Court that no notice prior to notice dated 9th November, 1982 had been received in the office of the Nagar Mahapalika, Allahabad and that the order of ex parte hearing be set aside.  The application was accompanied by an affidavit.  On the said application an order was passed by the Labour Court permitting the petitioner to participate in the proceedings from that stage fixing 11th January, 1983.  On 11th January, 1983, the petitioner filed a written statement.  In the counter affidavit filed by the respondent no.3 it has been stated that the summon dated 25th August, 1982 was served upon the petitioner through the peon book which bears the signature of some officer or employee of the petitioner in token of receiving summon.  This fact has been specifically denied by the petitioner in the rejoinder affidavit wherein it has been stated that no notice was served on the Administrator of the Nagar Mahapalika, Allahabad, who is the competent authority on whom the notice should be served.  The Labour Court had not decided the question as to whether any notice was served upon the petitioner or not.  It proceeded to decide ex parte.  The first date itself was fixed on 20th September, 1982 on which the Labour Court decided to proceed ex parte without recording any finding as to whether summons have been served on the petitioner or not.  When the petitioner sought to file written statement, it was not accepted on the plea that the Legal Officer has not been authorized by the Administrator as there is no letter of authority.  The letter of authority has already been filed before the Labour Court.  Thus, it appears that the Labour Court proceeded to adjudicate the matter in haste without giving any reasonable opportunity of hearing to the petitioner which has resulted in failure of the justice and vitiated the entire award.  Since I have come to the conclusion that the award stands vitiated on account of depriving the petitioner from filing written statement, the interest of justice requires that the matter be remanded to the Labour Court for deciding the dispute afresh in accordance with law after taking on record the written statement filed by the petitioner and giving opportunities to the parties to file such other documents and lead evidence as they may be advised.  In this view of the matter, the other points raised by the learned counsel for the parties regarding time bound appointment, relief of reinstatement, back wages, continuity of service and regularization of service are not being gone into and it will be open to the parties to raise these pleas before the Labour Court.  

In the result the writ petition succeeds and is allowed. The impugned award dated 10th October 1983 is set aside and the Labour Court is directed to decide the dispute afresh in accordance law and in the light of the observations made above. Since the respondent no.3 is working since 4th October, 1985 and about 18 years have passed it would be appropriate and in the interest of justice that status quo as of today with regard to the services of the petitioner be maintained till the Labour Court gives its award.

October  24, 2003

mt


Copyright

Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites

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