# Duncans Industries Ltd.(Fertiliser Div.), Panki Kanpur v. State of U.P. & Ors

- **Citation:** (2020) 10 ILRA 243
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2020-08-10
- **Case number:** Writ- C No. 30660 of 2000
- **Bench:** J.J. Munir
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/duncans-industries-ltd-fertiliser-div-panki-kanpur-v-state-of-u-p-ors-45177
- **Pages:** 23

## Headnote

Sri S.M.A. Kazmi, Sri D. Chauhan, Ms.
Bushra Maryam, Sri Pankaj Srivastava, Sri
Rakesh Kumar, Sri Rohit Shukla, S.C.
Vikram, Sri Vikram D. Chauhan, Sri Sanjay
Singh Yadav

A. Labour law - Industrial Dispute Act, 1947
- Regularization of workmen - Continuous service
for 240 days in a calendar year - Its relevance -
Factum of continuous service for 240 days in a
calendar year is relevant under Section 6-N of the
Act, which relates to retrenchment of a workmen.
It is absolutely irrelevant to a workman's right to
claim regularization - However, consideration of
one irrelevant factor by the Industrial Tribunal
does not detract from the overall soundness of the
conclusion, considering other relevant factors that
have entered judgment - Held, the Labour Court
has reasonably concluded that from the date the
workmen have been engaged by the Employers,
they are in their regular and continuous
employment; the workmen were retained by the
Employers to do work of a perennial nature. (Para
38, 39 and 40)
B. Labour law - Regularization of workmen -
Principle relating to the State service - It's
applicability to Non-state service - The decision of
MP Housing Board's case and Umadevi's case
laying down the proposition that Courts, by
exercise of the judicial power, cannot thrust
regularization upon the executive; etc. are
bedrocks of support for the proposition that
Employers canvass - These principles are not open
to question in the field of service law, where
employment is either under the State or a State
Instrumentality - These principles, however, may
not apply in cases of industrial disputes, where the
Employers are an industry, who are not in any way
the State or a State Instrumentality - Held, if the
Industrial Tribunal were to find the action of the
Employer continuing their workmen under a
facade as casuals to do work of a permanent
nature, an unfair labour practice, there is no
principle that forbids the Tribunal under the Act
from undoing that injustice. (Para 44, 45 and 46)
C. Labour law - Industrial Tribunal - Finding of
facts - Unfair labour practice - Industrial Tribunal
has recorded a positive finding that it is case of
unfair labour practice by the Employers on the
facts and circumstances that show that the
Employers have retained the workmen as casual
hands to do work of a perennial nature - The said
finding is a pure finding of fact, based on
appreciation of evidence, about which there is no
demonstrable or manifest illegality - Held, no
illegality, much less a manifest illegality, can be
found in the impugned award. (Para 48 and 60)
Writ Petition dismissed (E-1)
Cases relied on :-

## Text

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10 All. Duncans Industries Ltd.(Fertiliser Div.), Panki Kanpur Vs. State of U.P. & Ors.
243
development authorities in the State for
necessary compliance.
----------
(2020)10ILR A243
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 10.08.2020

BEFORE

THE HON'BLE J.J. MUNIR, J.

Writ- C No. 30660 of 2000

Duncans Industries Ltd.(Fertiliser Div.),
Panki Kanpur ...Petitioner
Versus
State of U.P. & Ors. ...Respondents

Counsel for the Petitioner:
Sri B.K. Mukerjee, Sri P.K. Mukerjee, Sri S.
Chatterjee

Counsel for the Respondents:
Sri S.M.A. Kazmi, Sri D. Chauhan, Ms.
Bushra Maryam, Sri Pankaj Srivastava, Sri
Rakesh Kumar, Sri Rohit Shukla, S.C.
Vikram, Sri Vikram D. Chauhan, Sri Sanjay
Singh Yadav

A. Labour law - Industrial Dispute Act, 1947
- Regularization of workmen - Continuous service
for 240 days in a calendar year - Its relevance -
Factum of continuous service for 240 days in a
calendar year is relevant under Section 6-N of the
Act, which relates to retrenchment of a workmen.
It is absolutely irrelevant to a workman's right to
claim regularization - However, consideration of
one irrelevant factor by the Industrial Tribunal
does not detract from the overall soundness of the
conclusion, considering other relevant factors that
have entered judgment - Held, the Labour Court
has reasonably concluded that from the date the
workmen have been engaged by the Employers,
they are in their regular and continuous
employment; the workmen were retained by the
Employers to do work of a perennial nature. (Para
38, 39 and 40)
B. Labour law - Regularization of workmen -
Principle relating to the State service - It's
applicability to Non-state service - The decision of
MP Housing Board's case and Umadevi's case
laying down the proposition that Courts, by
exercise of the judicial power, cannot thrust
regularization upon the executive; etc. are
bedrocks of support for the proposition that
Employers canvass - These principles are not open
to question in the field of service law, where
employment is either under the State or a State
Instrumentality - These principles, however, may
not apply in cases of industrial disputes, where the
Employers are an industry, who are not in any way
the State or a State Instrumentality - Held, if the
Industrial Tribunal were to find the action of the
Employer continuing their workmen under a
facade as casuals to do work of a permanent
nature, an unfair labour practice, there is no
principle that forbids the Tribunal under the Act
from undoing that injustice. (Para 44, 45 and 46)
C. Labour law - Industrial Tribunal - Finding of
facts - Unfair labour practice - Industrial Tribunal
has recorded a positive finding that it is case of
unfair labour practice by the Employers on the
facts and circumstances that show that the
Employers have retained the workmen as casual
hands to do work of a perennial nature - The said
finding is a pure finding of fact, based on
appreciation of evidence, about which there is no
demonstrable or manifest illegality - Held, no
illegality, much less a manifest illegality, can be
found in the impugned award. (Para 48 and 60)
Writ Petition dismissed (E-1)
Cases relied on :-
1. Chandra Shekhar Azad Krishi Evam Prodyogiki
Vishwavidyalaya Vs United Trades Congress &
anr., (2008) 2 SCC 552.
2. M.P. Housing Board & anr. Vs Manoj
Shrivastava, (2006) 2 SCC 702
3. Secretary, St. of Kar. & ors. Vs Umadevi (3) &
ors.,(2006) 4 SCC 1
4. Indian Drugs & Pharmaceuticals Ltd. Vs
Workmen, Indian Drugs & Pharmaceuticals Ltd.,
(2007) 1 SCC 408
244 INDIAN LAW REPORTS ALLAHABAD SERIES
5.
Maharashtra
State
Road
Transport
Corporation & anr. Vs Casteribe Rajya Parivahan
Karmchari Sanghatana, (2009) 8 SCC 556
6. U.P. State Road Transport Corporation,
Kanpur & anr. Vs Roadways Karamchari Sanyukt
Parishad & ors., 2013 SCC OnLine All 13737
7. M/s. Hindustan Tin Works Pvt. Ltd. Vs
Employees of M/s. Hindustan Tin Works Pvt.
Ltd. & ors., (1979) 2 SCC 80
8. Workmen of Bhurkunda Colliery of Central
Coalfields Ltd. Vs Bhurkunda Colliery of Central
Coalfields Ltd., (2006) 3 SCC 297
9. Harjinder Singh Vs Punjab State Warehousing
Corporation, (2010) 3 SCC 192
10. Bharat Bank Ltd., Delhi Vs Employees of the
Bharat Bank Ltd., Delhi, AIR 1950 (37) SC 188
11. State of Maharashtra & anr. Vs R.S. Bhonde
& ors., (2005) 6 SCC 751
12. Divisional Manager, Aravali Golf Club & anr.
Vs Chander Hass & anr., (2008) 1 SCC 683
(Delivered by Hon'ble J.J. Munir, J.)

1. The petitioners are Employers
disillusioned
with
an
award
of
the
Presiding Officer, Industrial Tribunal (3),
U.P., Kanpur passed in an industrial dispute
between them and their workmen. The
original petitioners were a certain Duncans
Industries Limited (formerly known as
Chand Chhap Fertilizer and Chemicals
Limited,
Fertilizer
Division,
Panki,
Kanpur). It appears that due to losses
suffered in business by Duncans they
became sick and were declared a sick
industrial company by the Board of
Industrial and Financial Reconstruction (for
short, 'the BIFR'), under the provisions of
the Sick Industrial Companies (Special
Provisions) Act, 1985 vide order dated
21.07.2007. The State Bank of India were
appointed the operating agency to explore
avenues for revival of the sick industrial
company. In proceedings before the BIFR,
a certain M/s. Kanpur Fertilizer and
Cement Limited proffered to work in joint
venture for revival of the sick industrial
company. The operating agency acting on
the said offer, drew up and presented a draft
Rehabilitation Scheme on January the 16th,
2012 to the BIFR. This scheme was
sanctioned by the BIFR in terms that the
fertilizer undertaking of Duncans would be
transferred to and vest in M/s. Kanpur
Fertilizers and Cement Limited, as a going
concern. The sanctioned Rehabilitation
Scheme also transferred all liabilities of
Duncans to M/s. Kanpur Fertilizers and
Cement Limited, including pending legal
proceedings. It is in this manner that the
petitioners' name has now been changed to
M/s.
Kanpur
Fertilizers
and
Cement
Limited, Panki, Kanpur.

2. M/s. Kanpur Fertilizers and
Cement Limited sought impleadment in
place of Duncans through Civil Misc.
Application No. 199844 of 2012. This
application was allowed by an order of the
Court dated 22.08.2012. The petitioners,
originally
called
Duncans
Industries
Limited
(Fertilizer
Division),
Panki,
Kanpur,
have
since
been
virtually
substituted as M/s. Kanpur Fertilizers and
Cement Limited, Panki, Kanpur. The
petitioners have been impleaded under their
new name and style, rather incongruously
as petitioner No. 1/1. The petitioners ought
to have been impleaded as M/s. Kanpur
Fertilizers and Cement Limited, with their
particulars, after striking out the name of
Duncans from the array. Nevertheless, that
need not detain this Court any further,
except for a remark that M/s. Kanpur
Fertilizers and Cement Limited, Kanpur,
Panki are and shall be the sole petitioner of
this writ petition in place of Duncans.

3. The Employers have moved this
Court praying for a writ, order or direction
10 All. Duncans Industries Ltd.(Fertiliser Div.), Panki Kanpur Vs. State of U.P. & Ors.
245
in the nature of certiorari to quash the
award of the Presiding Officer, Industrial
Tribunal (3), U.P., Kanpur (Published on
10.05.2000) passed in Adjudication Case
No. 162 of 1989 between the Employers
and their twenty-seven workmen, twentyfour of whom are arrayed here as
respondent nos. 6 to 29. The respondentsworkmen are hereinafter referred to as 'the
workmen'. Four of the workmen are dead
and have been substituted by their heirs and
legal representatives vide an order of this
Court
dated
10.09.2018.
The
future
reference to workmen, shall include those
legal representatives. The award passed by
the Labour Court, last mentioned, shall
hereinafter be called ''the impugned award'.

4. It must be recorded here that in the
writ petition, challenge was laid to the vires
of the provisions of Section 4-E (2) and (3)
of the Uttar Pradesh Industrial Disputes
Act, 1947. This challenge, however, was
given up by the learned Counsel for the
Employers,
during
the
hearing
on
11.02.2020. The challenge is, therefore,
confined to the validity of the impugned
award.

5. Proceedings before the Labour
Court commenced on a reference made
under Section 4-K of the U.P. Industrial
Disputes Act vide order dated 28.09.1989,
in the following terms (translated into
English from Hindi vernacular):

"Whether the Employers are
obliged to declare 38 workmen detailed in
the attached schedule, permanent? If yes,
from what date and with what particulars?"

6. It appears that an industrial dispute
was raised by the Fertilizer Workers Union,
Kanpur, impleaded here as respondent no.5
(for short, 'the Union'), acting on behalf of
the workmen. The reference aforesaid led
to registration of Adjudication Case No.162
of 1989 on the file of the Presiding Officer,
Industrial Tribunal (3), U.P. Kanpur. He
issued notice to the parties asking them to
put in their pleadings. The Employers put
in their written statement dated 01.02.1990.
They further filed an amended written
statement. The workmen filed a written
statement
through
the
Union,
dated
29.11.1989. A reply to the amended written
statement was filed by the workmen on
28.10.1994.
The
Employers
filed
a
rejoinder statement dated 27th March, 1990
and the workmen filed their rejoinder
statement dated 16th September, 1997.

7. In support of the Employers' case,
four witnesses were examined, that is to
say, Captain Chopra, Mrs. P. Ganguli, Daud
Khan and Captain Tripathi. Likewise, on
behalf of the workmen four persons, to wit,
Chhotelal, Jaspal, Binda Prasad and A.K.
Srivastava were examined as witnesses.
The testimony of the Employers' witnesses
and the workmen's witnesses is on record
as Annexures
to
this
petition.
The
documentary
evidence,
which
finds
mention in the impugned award, has not
been placed before the Court, either by the
Employers
or
the
workmen.
These
documents have been noticed in the award
as EW-1 to 9 and W-12 to 28, which appear
to be the Employees State Insurance
identity cards. There is also Exhibit W-1011 relating to M/s. Dev Kumar and Narain
Dixit, respectively, that is said to be the log
book showing their dates of employment as
20.08.1985 and 12.11.1982, in that order.
Exhibits E-1 and E-2 relate to Sobhnath,
who was retained as a casual hand. These
are two applications dated 01.12.1985 and
26.08.1986 relating to his employment as a
casual hand. Likewise, Exhibits E/3, 4 and
5 relate to Rampyare. It is a form dated
246 INDIAN LAW REPORTS ALLAHABAD SERIES
26.08.1986 for his casual employment.
Likewise, there are Exhibits E-6 to E-24 all
relating to different workmen, being
applications and other documents all of
which appear to be evidence about the date
of their employment. There is one Exhibit
E/5, which is an internal advertisement
relating to some post described as a GC in
the packing plant. This reference to
evidence has been drawn from the
description of it in the impugned award.
There is no mention of this documentary
evidence in the writ petition or the other
pleadings of parties before this Court. The
Labour Court, after hearing parties, passed
the
impugned
award,
answering
the
reference in favour of the workmen, in
terms that the Employers were ordered to
appoint the workmen as permanent with
effect from the date of the award and to pay
them
wages,
besides
other
benefits
admissible to permanent workmen. It has
been brought to the notice of this Court,
through the third Supplementary Affidavit,
sworn on 7th February 2019, that of the 38
workmen whose dispute was referred to the
Adjudication of the Labour Court, eleven
were
excluded
from
Adjudication
proceedings on account that some of them
died
whereas
others
joined
other
establishments.

8. It is pointed out that the
adjudication proceedings went ahead in
relation to 27 workmen alone. Of them it is
said in paragraph no.5 of the affidavit under
reference that 24 workmen, who were
parties to the adjudication case and were
interested in the matter, got themselves
impleaded personally.

9. It has also been asserted in this
affidavit in paragraph nos.6, 7, 8 and 9 that
of the 24 workmen who have sought
individual impleadment, the Union aside
impleaded as respondent no.5, five have
settled their dispute with the Employers,
withdrawing their gratuity and other dues.
In addition, of the remainder, seventeen
workmen
have
attained
the
age
of
superannuation according to their provident
fund declaration Forms 9, annexed as
Annexure 9 to the writ petition. It is the
stand of the Employers that 9 workmen
alone wish to contest these proceedings in
presenti.

10. This Court does not think so. No
doubt photostat copies of the affidavits in
relation to the five workmen who are said
to have settled with the Employers outside
Court have been annexed along with two
earlier supplementary affidavits, but no
such stand has been taken before this Court
by the learned Counsel appearing for them.
The fact that these five workmen have
settled could be true or untrue. So long as
the five workmen do not file their affidavits
before this Court that they have settled, this
Court cannot act on photostat copies of
documents annexed to the Employers
affidavit. As for those eight workmen, who
are said to have retired, it does not mean
that their rights under the award have been
extinguished. If the award were to be
enforced, the benefit of it would enure to
them,
their
superannuation
notwithstanding.

11. There is an added reason for this
Court to believe that the workmen shown to
have compromised, may not have done so.
This is for the reason that the workmen,
arrayed as respondent nos. 6, 15, 22 and 26,
have died pending this petition and their
widows have come forward to seek
substitution, that has been granted by an
order of this Court dated 10.09.2018. The
Employers have placed on record a
photostat copy of an affidavit of Smt.
10 All. Duncans Industries Ltd.(Fertiliser Div.), Panki Kanpur Vs. State of U.P. & Ors.
247
Balwanti,
widow
of
late
Toofani,
impleaded to the writ petition as respondent
no. 6. A copy of the affidavit filed along
with the supplementary affidavit dated
24.07.2017, shows it to be one sworn on
10th March, 2017. The fact that Smt.
Balwanti has pressed for substitution and
secured it on 10.09.2018, does not support
a case of settlement prima facie. This Court
is, therefore, not inclined to accept a case
about any kind of a settlement, in the
absence of the concerned workmen saying
so before this Court on their affidavit. The
Labour Court has recorded a specific
finding, in relation to eleven of the thirtyeight workmen, at whose behest this
industrial dispute was raised, that they have
opted
out
or
otherwise
become
disassociated with the present industrial
dispute. The names of the workmen, who
have disassociated or exited the industrial
dispute, are detailed in paragraph 8 of the
impugned award. They are:

Sr. No.Names
Reason of disassociation
1. Shiv Singh Negi
Opted out of the dispute
2.Anil Kumar Srivastava Opted out of the dispute
3. Allauddin
Opted out of the dispute
4. Jagdish Kumar
Opted out of the dispute
5. H.K. Dwivedi
Left service and joined KETELCO
6. Ramdas
Left service and joined KETELCO
7. Ram Lal
Left service and joined KETELCO
8.Ashok Kumar (II)
Died
9. Ayodhya Prasad
Died
10. Gajadhar
Retired
11. Dukh Haran
Retired

The circumstances, in which
these workmen have abandoned their rights
in the instant industrial dispute, have been
enumerated
in
the
impugned
award.
Accordingly, this writ petition is being
heard on the basis that of all the thirty-eight
workmen, at whose instance this industrial
dispute was raised by the Union, twentyseven alone continue to be parties. This
figure of twenty-seven largely accounts for
the twenty four, who have become parties
to this writ petition.

12. To put the record straight, of all
the thirty-eight workmen, at whose instance
this industrial dispute was raised, it is the
twenty-seven
workmen,
detailed
hereinafter
(the
heirs
and
legal
representatives of the deceased workmen
included), whose case shall be considered
by this Court, regarding them as the parties
to the industrial dispute. The names of
these workmen are indicated below, along
with the employment dates shown against
their respective names:

Sr. No.
Name Date of Engagement
1. Tufani
 14.04.1985
2. Narayan Kumar (I)
 24.01.1984
3. Jaspal Kumar
 25.01.1984
4. Binda Prasad
 24.01.1984
5. Krishna Kumar
 15.03.1983
6. Narayan (Retired)
 25.01.1984
7. Babu Lal
 24.01.1984
8. Umesh Kumar
 31.01.1984
9. Uma Shankar
 26.01.1984
10. Dev Kumar
 20.08.1985
11. Deen Dayal
 14.06.1985
12. Anant Lal
 17.09.1981
13. Asha Ram
 27.08.1982
14. Sri Narayan Dixit
 12.11.1982
15.Chhotey Lal
 12.06.1985
16. Bange Lal
 28.08.1986
17. Vijay Lal
 26.11.1986
18. Jagdev
 28.08.1986
19. Ganesh
 28.08.1986
20. Vishram
 28.08.1986
248 INDIAN LAW REPORTS ALLAHABAD SERIES
21. Chaunhar
 28.08.1986
22. Jhinaku Yadav
 28.08.1986
23. Sobhnath
 28.08.1986
24.Robbin Bruth
 16.04.1982
25.Ram Pyarey
 27.08.1986
26.P.K. Dutta
 06.02.1984
27.Chandrabhan Prasad
 24.01.1984

13. Heard Sri S. Chatterjee, learned
Counsel for the Employers and Ms. Bushra
Maryam, learned Counsel appearing for the
workmen.

14. The Labour Court has recorded
findings to the effect that Exs. W/1 - W/28
show
that
the
workmen have
been
employed with effect from the dates,
indicated against their respective names,
claimed by them. These dates of retention
for the different workmen are also
corroborated by the Employers' documents,
filed as Exs. E/1 - E/24. There is then a
remark by the Labour Court that these
documents indicate that the workmen have
been in continuous employment from their
date of retention and have put in 240 days
of service in the Employers' establishment,
each year. The Labour Court has gone on to
say that the Employers have urged that
these workmen were retained as casual
labourers, according to exigencies of work
from time to time. They cannot, therefore,
ask for regularization.

15. It is noted further by the Labour
Court that the contra submission advanced on
behalf of the workmen is that they have been
retained to do work in the establishment of a
perennial nature. They have been doing that
work continuously since their engagement,
putting in 240 days' service each year. They
are, therefore, entitled to be made permanent.
The Labour Court has taken note of a certain
Employers' witness, who testified as EW-4
and
acknowledged
during
his
crossexamination that casual hands are retained in
place of workmen, who are absent from
duties.

16. The Labour Court has remarked that
the Employers have not furnished any
particulars, indicating which of the workmen
were retained as casual hands to discharge
duties, of which of the named absenting
permanent workmen. It is also said by the
Labour Court that the Employers have not
testified to the effect whether the workmen
are in continuous employment, from the date
of their retention. The Labour Court has
drawn an inference that from the evidence of
this witness, it cannot be said that the
workmen are not in continuous employment
from the dates of their engagement. The
Labour Court has then proceeded to hold that
in
view
of
all
this
evidence
and
circumstances, it would be incorrect to say
that the workmen have been retained as
casual hands, from time to time, according to
exigencies of work. This stand of the
Employers was found unacceptable.

17. The Labour Court has also noticed
that the documents brought on record show
that prior to engagement as casual hands by
the establishment, these workmen were
also retained by the Employers as workmen
of a Labour Contractor. For the period of
engagement, that the services of workmen
were hired through the Labour Contractor,
they have been disowned by the Employers
as the Contractor's employees, with whom
they had no kind of privity or relationship
of Employer and Employee. The Labour
Court has remarked that the Employers
cannot forsake their obligations towards the
workmen by dubbing them as the Labour
Contractor's men, inasmuch as during the
relevant period of time, these workmen
worked
for
the
Employers
in
their
10 All. Duncans Industries Ltd.(Fertiliser Div.), Panki Kanpur Vs. State of U.P. & Ors.
249
establishment, under their direct control. As
such, the Employers were their principal
Employer and the Labour Contractor, an
agency for engagement alone.

18. The Labour Court has held that in
these circumstances, during time that the
workmen were engaged through the Labour
Contractor, they would be considered to be
retained by the Employers and part of their
establishment. There is then an added
remark that even if it be assumed that the
period of time, during which the services of
the workmen were secured through the
Labour Contractor, is to be discounted, it
would have no bearing on the workmen's
rights here. This is so, because the relevant
dates of retention in service, on the basis of
which the workmen claim rights, are those
when the workmen entered into direct
engagement with the Employers de hors the
agency of a Labour Contractor. It is quite
another matter, the Labour Court says, that
they have been shown by the Employers as
casual hands, who have been paid on a
daily-wage basis. In the opinion of the
Labour Court, the continued description of
the workmen as casual hands and their
remuneration on daily-wages, cannot be
said to be proper.

19. The Labour Court has gone on to
say that it was the Employers' obligation to
show by production of relevant records that
the workmen did not render regular
services in the establishment, and that they
were hired from time to time, according to
exigencies of work. But, the Employers
have not proved anything to that effect. To
the contrary, the workmen's witnesses have
clearly testified to the fact that they have
regularly
worked
in
the
Employers'
establishment since their retention, and that
during each year they have put in more
than 240 days of service. It is also
remarked that this testimony of the of the
workmen's witnesses is corroborated by the
Employers' evidence. There is no evidence
by the Employers in rebuttal of this fact.

20. The Labour Court has also taken
note of a submission advanced on behalf of
the Employers that the workmen for
themselves
had
accepted
casual
employment, which is indicated from their
applications, and once the workmen had
accepted casual engagement, they had no
right to claim permanent status. The Labour
Court has discarded this submission by
holding that the Employers cannot shake
off their constitutional obligations, falling
back on what the workmen had said in their
applications at the time of their first
engagement.
The
Labour
Court
has
remarked that whatever the workmen have
said in their applications, at the time of
their initial engagement, cannot work to
deprive them perpetually of their rights,
that otherwise accrue.

21. There is then a rather odd finding
by the Labour Court, which says that
according to general rule and law, if a
workman is employed to do work of a
permanent nature that he does regularly,
and further puts in 240 days of service in a
calendar year with the establishment, he
cannot be deprived of regular pay scale.
The Labour Court has gone further on to
hold that it is true for a fact that the
workmen have put in work in the same
manner as permanent employees in the
establishment,
and
that
there
is
no
difference between the work done by these
workmen
and
the
other
permanent
workmen.

22.

The
Labour
Court
has,
accordingly proceeded to hold that the
action of the Employers in retaining these
250 INDIAN LAW REPORTS ALLAHABAD SERIES
workmen as casual hands, to undertake
work
of
a
perennial
nature,
is
demonstrative of mala fides on the part of
the Employers and a clear instance of
unfair labour practice, which by any
standard cannot be approved. The Labour
Court has also said that the aforesaid action
of the Employers is an exemplar of mala
fides, vis-a-vis these workmen. Again at
this stage, the Labour Court has reverted to
its finding, that this Court has earlier called
rather odd, that the workmen having put in
240 days of service during twelve calendar
months continuously and more, they are
entitled to the same benefit and pay scale as
permanent workmen. The action of the
Employers has been condemned as one
contrary to social justice.

23. The Labour Court has held further
on, that bearing in mind the facts,
circumstances and evidence on record, it is
clear
that
the
workmen
have
been
employed with effect from the dates shown
against their respective names to undertake
work of a permanent character, and that
their work or conduct has never been found
to be one that may occasion any complaint
or demonstrate deficiency. There is no
dearth of work with the Employers and,
therefore, there is no reason to deprive
them of any benefit.

24. The conduct of the Employers
has, in substantial measure, been criticized
by the Labour Court about the dilatory
tactics adopted by them before that Court.
The particulars of those tactics have been
recorded. In conclusion, the Labour Court
has awarded that the workmen be declared
permanent by the Employers and that they
are entitled to be declared permanent with
effect from the date of the award. They
have
also
been
held
entitled
to
consequential benefits.

25. Mr. Chatterjee, learned Counsel
for the Employers has severely criticized
the award. He submits that the impugned
award is serious flawed, because the
Labour Court has gone all wrong about
inferring a claim for permanency on the
basis of the workmen putting in 240 days
of continuous work in each calendar year.
He submits that the law relating to 240
days of continuous work, in a calendar
year, is one that is relevant to a case of
retrenchment and to judge the legality
thereof. It is relevant under Section 6-N of
the Uttar Pradesh Industrial Disputes Act,
1947 (for short, ''the Act'), but not at all
relevant for the purpose of judging a claim
to be declared permanent by a workman, or
even regular, by a casual hand. In support
of his contention, he places reliance on the
decision of the Supreme Court in Chandra
Shekhar Azad Krishi Evam Prodyogiki
Vishwavidyalaya
vs.
United
Trades
Congress and another, (2008) 2 SCC 552.
He has drawn the attention of the Court to
paragraph 12 of the report in C.S. Azad
Krishi
Evam
Prodyogiki
Vishwavidyalaya (supra), where it is held:

"12. A feeble attempt, however,
was made by the learned counsel appearing
on behalf of Respondent 2 to state that he
had been appointed against a permanent
vacancy. In his written statement, he did
not raise any such contention. It does not
also appear from the records that any offer
of appointment was given to him. It is
inconceivable that an employee appointed
on a regular basis would not be given an
offer of appointment or shall not be placed
on a scale of pay. We, therefore, have no
hesitation in proceeding on the premise that
Respondent 2 was appointed on daily
wages. The Industrial Court in passing the
impugned award proceeded on the premise
that Respondent 2 had been working for
10 All. Duncans Industries Ltd.(Fertiliser Div.), Panki Kanpur Vs. State of U.P. & Ors.
251
more than 240 days continuously from the
date of his engagement. It is now trite that
the same by itself does not confer any right
upon a workman to be regularized in
service. Working for more than 240 days in
a year was relevant only for the purpose of
application of Section 6-N of the U.P.
Industrial Disputes Act, 1947 providing for
conditions
precedent
to
retrench
the
workmen. It does not speak of acquisition
of a right by the workman to be regularized
in service.(Emphasis by Court)

26. Mr. Chatterjee has further
submitted that a workman, in order to
acquire the status of a permanent workman,
must be appointed in terms of the relevant
rules. He submits that for the Employers
the relevant rules, for a workman to acquire
the status of permanency, find place in
Clause 6.1 of the Recruitment Policy, that
is part of the registered settlement dated
16.12.1985. He again emphasizes that
merely working for a long period of time,
and 240 days in each calendar year, has no
legal basis to confer upon the workman the
status of permanency. That status can only
be acquired in terms of the relevant rules,
detailed hereinbefore. In support of this
contention,
learned
Counsel
for
the
Employers has placed reliance on a
decision of the Supreme Court in M.P.
Housing Board and another vs. Manoj
Shrivastava, (2006) 2 SCC 702. He has
drawn the attention of the Court to
paragraphs 10 and 15 of the report in M.P.
Housing Board (supra), where it has been
held by their Lordships:

"10. It is one thing to say that a
person was appointed on an ad hoc basis or
as a daily-wager but it is another thing to
say that he is appointed in a sanctioned post
which was lying vacant upon following the
due procedure prescribed therefor.

15. A daily-wager does not hold a
post unless he is appointed in terms of the
Act and the Rules framed thereunder. He
does not derive any legal right in relation
thereto."

27.

Learned
Counsel
for
the
Employers has buttressed the proposition
canvassed
by
him
that
mere
long
continuance as a casual hand or a
temporary would not entitle the workmen
to claim permanency. He has drawn support
for the proposition from the Constitution
Bench decision of the Supreme Court in
Secretary, State of Karnataka and others
vs. Umadevi (3) and others, (2006) 4 SCC
1. He has invited the attention of this Court
to paragraphs 45 and 47 of the report in
Umadevi (supra), where it is held:

"45.
While
directing
that
appointments, temporary or casual, be
regularized or made permanent, the courts are
swayed by the fact that the person concerned
has worked for some time and in some cases
for a considerable length of time. It is not as
if the person who accepts an engagement
either temporary or casual in nature, is not
aware of the nature of his employment. He
accepts the employment with open eyes. It
may be true that he is not in a position to
bargain--not at arm's length--since he might
have been searching for some employment so
as to eke out his livelihood and accepts
whatever he gets. But on that ground alone, it
would not be appropriate to jettison the
constitutional scheme of appointment and to
take the view that a person who has
temporarily or casually got employed should
be directed to be continued permanently. By
doing so, it will be creating another mode of
public appointment which is not permissible.
If the court were to void a contractual
employment of this nature on the ground that
the parties were not having equal bargaining
252 INDIAN LAW REPORTS ALLAHABAD SERIES
power, that too would not enable the court to
grant any relief to that employee. A total
embargo on such casual or temporary
employment is not possible, given the
exigencies of administration and if imposed,
would only mean that some people who at
least
get
employment
temporarily,
contractually or casually, would not be
getting even that employment when securing
of such employment brings at least some
succour to them. After all, innumerable
citizens of our vast country are in search of
employment and one is not compelled to
accept a casual or temporary employment if
one is not inclined to go in for such an
employment. It is in that context that one has
to proceed on the basis that the employment
was accepted fully knowing the nature of it
and the consequences flowing from it. In
other words, even while accepting the
employment, the person concerned knows the
nature of his employment. It is not an
appointment to a post in the real sense of the
term. The claim acquired by him in the post
in which he is temporarily employed or the
interest in that post cannot be considered to
be of such a magnitude as to enable the
giving up of the procedure established, for
making regular appointments to available
posts in the services of the State. The
argument that since one has been working for
some time in the post, it will not be just to
discontinue him, even though he was aware
of the nature of the employment when he first
took it up, is not one that would enable the
jettisoning of the procedure established by
law for public employment and would have
to fail when tested on the touchstone of
constitutionality and equality of opportunity
enshrined in Article 14 of the Constitution.

47. When a person enters a
temporary employment or gets engagement
as a contractual or casual worker and the
engagement is not based on a proper selection
as recognised by the relevant rules or
procedure, he is aware of the consequences of
the appointment being temporary, casual or
contractual in nature. Such a person cannot
invoke the theory of legitimate expectation
for being confirmed in the post when an
appointment to the post could be made only
by following a proper procedure for selection
and in cases concerned, in consultation with
the Public Service Commission. Therefore,
the theory of legitimate expectation cannot be
successfully
advanced
by
temporary,
contractual or casual employees. It cannot
also be held that the State has held out any
promise while engaging these persons either
to continue them where they are or to make
them
permanent.
The
State
cannot
constitutionally make such a promise. It is
also obvious that the theory cannot be
invoked to seek a positive relief of being
made permanent in the post."

28. Mr. Chatterjee has emphasized
that the right to declare permanent, a casual
hand is essentially an executive function, or
so to speak the Employers' function. It
cannot be done by judicial interpose or fiat.
In support of his contention on this score,
Mr. Chatterjee places reliance on the
decision of the Supreme Court in Indian
Drugs & Pharmaceuticals Ltd. vs.
Workmen,
Indian
Drugs
&
Pharmaceuticals Ltd., (2007) 1 SCC 408.
Learned Counsel for the Employers has
drawn this Court's attention to paragraphs
37, 40, 43 and 44 of the report, where it has
been held:

"37. Creation and abolition of
posts
and
regularisation
are
purely
executive functions vide P.U. Joshi v.
Accountant General [(2003) 2 SCC 632:
2003 SCC (L&S) 191]. Hence, the court
cannot create a post where none exists.
Also, we cannot issue any direction to
absorb the respondents or continue them in
10 All. Duncans Industries Ltd.(Fertiliser Div.), Panki Kanpur Vs. State of U.P. & Ors.
253
service, or pay them salaries of regular
employees, as these are purely executive
functions. This Court cannot arrogate to
itself the powers of the executive or
legislature. There is broad separation of
powers under the Constitution, and the
judiciary, too, must know its limits.

40. The courts must, therefore,
exercise judicial restraint, and not encroach
into the executive or legislative domain.
Orders for creation of posts, appointment
on these posts, regularisation, fixing pay
scales, continuation in service, promotions,
etc. are
all
executive or legislative
functions, and it is highly improper for
Judges to step into this sphere, except in a
rare and exceptional case. The relevant
case-law
and
philosophy
of
judicial
restraint has been laid down by the Madras
High Court in great detail in Rama
Muthuramalingam v. Dy. Supdt. of Police
[AIR 2005 Mad 1] and we fully agree with
the views expressed therein.

43. In view of the above
observations of this Court it has to be held
that the rules of recruitment cannot be
relaxed and the court/tribunal cannot direct
regularisation of temporary appointees
dehors the rules, nor can it direct
continuation of service of a temporary
employee (whether called a casual, ad hoc
or daily-rated employee) or payment of
regular salaries to them.

44.
It
is
well
settled
that
regularisation cannot be a mode of
appointment vide Manager, Reserve Bank
of India v. S. Mani [(2005) 5 SCC 100:
2005 SCC (L&S) 609: AIR 2005 SC 2179]
(AIR para 54)."

29.

Learned
Counsel
for
the
Employers
has
supplemented
his
contentions by urging that sickness of the
industry in the hands of the Employers is
also a relevant consideration, while judging
a claim of the present kind. He submits that
the Labour Court ought to have taken into
account the fact that a sick company,
running into heavy losses, may not have
any post to accommodate a workman,
ordered to be made permanent. Again, Mr.
Chatterjee relies on the decision of the
Supreme Court in Indian Drugs &
Pharmaceuticals Ltd. (supra), where it
has been held:

"54. In the present case, the
appellant is a sick company which has been
running on huge losses for many years, and
is practically closed down. There are no
vacancies on which the respondents could
have been appointed. While we may have
sympathy with them, we cannot ignore the
hard economic realities, nor the settled
legal principles."

30. Ms. Bushra Maryam, learned
Counsel for the workmen, repelling the
contentions of the learned Counsel for the
Employers, submits that in case of an
industrial dispute, decided under the labour
laws
by
a
competent
Tribunal,
considerations very different from those
governing an adjudication of a service
matter by this Court, under Article 226 of
the Constitution or by their Lordships of
the Supreme Court, under Article 32, apply.
She urges that the principles evolved by the
Constitution Bench in Umadevi (supra)
have scant or no application in the context
of an industrial dispute decided by a
Labour Court under the Act. In support of
her submissions, learned Counsel for the
workmen has placed reliance upon a
decision
of
the
Supreme
Court
in
Maharashtra
State
Road Transport
Corporation and another vs. Casteribe
Rajya
Parivahan
Karmchari
Sanghatana, (2009) 8 SCC 556. She has
invited the attention of the Court to the
254 INDIAN LAW REPORTS ALLAHABAD SERIES
decision in Maharashtra State Road
Transport Corporation (supra), where it
is held:

"30. The question that arises for
consideration is: have the provisions of the
MRTU and PULP Act been denuded of the
statutory status by the Constitution Bench
decision in Umadevi (3) [(2006) 4 SCC 1:
2006 SCC (L&S) 753]? In our judgment, it
is not.

31. The purpose and object of the
MRTU and PULP Act, inter alia, is to
define and provide for prevention of certain
unfair
labour
practices
as
listed
in
Schedules II, III and IV.