# ROHTAS INDUSTRIES LTD v. RAMLAKHAN SINGH AND ORS

- **Citation:** [1978] 3 S.C.R. 93
- **Court:** Supreme Court of India
- **Decided:** 1978-02-16
- **Bench:** N. L. Untwalia, P. S. Kailasam, V. D. Tulzapurkar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/rohtas-industries-ltd-v-ramlakhan-singh-and-ors-7467
- **Pages:** 5

## Headnote

Right to file a complaint u/s 26(2) r!w s. 2(4) of the Bihar Shops and
Establishments Act, 1953.
Words and Phrases-Scope of the words "subject to the manufacturing process" occurrinR in s. 2(1) of the Factories Act (LXlll) 1948.
A
B
The sen•ices of Respondent Ramlakhan Singh who
was working ns sectional officer in the Waste Paper' department of the paper
factory of
the
C
appellant at Dalmianagar. Bihar State was terminated with immediate effect
by
a
notice dated 10-6-1970,
with
an
offer
of
·one
month's
wages
in lieu
of notice.
The respondent assailed
the order of his
termination by making a complaint u/s. 26(2) of the Bihar Shops & Establishments Act, 1953. The appellant contested on merits, as well as on the technical ground that it \lo'as no~ maintainable under the Bihar Act as the respO'Ildcnt
was not an employee within the meaning of s. 2 ( 4) of the Act.
The Labour
Court, by its order dated 29-5-1972, held that the respondent was not a factory
vtork.e1' within the meaning of s. 2(1) of the Factories Act. 1948 and he-!1-ce
D
was a'!l employee· within the· meani~g of the Bihar Act.
The Writ Petition
filed by the appe1lant in the Patna High
Court against the said
order was
dismissed asking hiln to aigitate this point after the final decision was made
by the Court. The Labour Court oil merits, decided the matter on 28-2-1973.
allowed the petition of the respondent and ordered his reinstatement with full
back wages.
A fresh writ petition challenging the said orders was also dismissed by the Patna High Court.
AIIowing the appeal by special leave, the Court,
E
HELD: Only a. person who is an employee u/s 2(4) of the Bihar Shops
and Establishments Act, 1953, could file an application u/s 26(2). [95B]
Even persoos employed in a factory by the inclusive clause in the second
5entence of the definition in S. 2(4) are employees within the meaning of the
Bihar Act.
But hvo exceptions have been carved ou~ from the category of
such persons, namely, ( l) "Who are not workers within the meaning of tbc
Factories Act", such CJ> worker does not come withi•.1 the inclusive definition of
F
the term emoloyee; (2) who <'!re ncn v:orking in a managerial capaciey.
I'll
other words even a person employed in a factory and who is not n \1/0rker
within the meaning of the factories Act will not be an employee u/s 2 ( 4)
of
the Bihar Act, if he is working in a managerial capacity.
[95D-F]
Reading clause ( 1) of s. 2 of f1he Factories Act, 1948, together \\'ith ctausr
(k) and (m) thereof. it is dear that a person to be a \Vorker withfn the rnca-ning of the1 Factorie:~ Act rnu5t b~ a person employed i11 the premises or the
precincts of the factory.
f96Cl
G
Sta'e of U.P. v. M. P. Singh & Ors .. [1960] 2 SCR 605 reiterated.
Raw materi2,1s used, in the manufacturing process for producing paper and
i~ various products, undoubtedly. will be a
"subject of the
rnainufacturing
process'' within the meaning of clnuse 1 of section 2 of the Factories
Act.
whatever also may be or n1ay not be such subject.
[97A-B]
In the instant case, the
respo)l<lent was not
working in a
manageria·l
H
.capacity.
Though
he
was
not employed "in any manufacturing process or
in cleaning any part of the machinery or premises used for a manufacturing
process'', he was engaged in
a
work
\Vhich
was
connected
with
the
'
;
94
SUPREME COURT REPORTS
(1978] 3 S.C.R.
A
··~!Jbject of the J!lanufacturing proce~s'' and therefore, he was a factory \vorker
\V1th1n the meaning of clause ( 1) of s. 2 of the Factories Act, 1948.
He.nee
he was not an employee within the meaning of the Bihar Shops and Establishment<; Act, 1953.
The petition of complaint filed by him u/s 26(2) was
not
maintainable.
r96G, 97B.Cl
B
CIV!r. APPELLATE JURISDICTION: Civil Appeal
No. 1821
of
1977.
(Appeal by Special Leave from the Judgment and Order dated
19th August, 1976 of a Bench of High Court of Patna in C.W.J.C.
No. 650 of 1973).
A. B. N. Sinha, B. P. Maheshwari and Suresh Sethi for
the
Appellant.
C
Lal Narain Sinha, P. P. Sing

## Text

-
93
ROHTAS INDUSTRIES LTD.
v.
RAMLAKHAN SINGH AND ORS.
February 16, 1978
[N. L. UNTWALIA, P. S. KAILASAM AND V. D. TULZAPURKAR, JJ.J
Right to file a complaint u/s 26(2) r!w s. 2(4) of the Bihar Shops and
Establishments Act, 1953.
Words and Phrases-Scope of the words "subject to the manufacturing process" occurrinR in s. 2(1) of the Factories Act (LXlll) 1948.
A
B
The sen•ices of Respondent Ramlakhan Singh who
was working ns sectional officer in the Waste Paper' department of the paper
factory of
the
C
appellant at Dalmianagar. Bihar State was terminated with immediate effect
by
a
notice dated 10-6-1970,
with
an
offer
of
·one
month's
wages
in lieu
of notice.
The respondent assailed
the order of his
termination by making a complaint u/s. 26(2) of the Bihar Shops & Establishments Act, 1953. The appellant contested on merits, as well as on the technical ground that it \lo'as no~ maintainable under the Bihar Act as the respO'Ildcnt
was not an employee within the meaning of s. 2 ( 4) of the Act.
The Labour
Court, by its order dated 29-5-1972, held that the respondent was not a factory
vtork.e1' within the meaning of s. 2(1) of the Factories Act. 1948 and he-!1-ce
D
was a'!l employee· within the· meani~g of the Bihar Act.
The Writ Petition
filed by the appe1lant in the Patna High
Court against the said
order was
dismissed asking hiln to aigitate this point after the final decision was made
by the Court. The Labour Court oil merits, decided the matter on 28-2-1973.
allowed the petition of the respondent and ordered his reinstatement with full
back wages.
A fresh writ petition challenging the said orders was also dismissed by the Patna High Court.
AIIowing the appeal by special leave, the Court,
E
HELD: Only a. person who is an employee u/s 2(4) of the Bihar Shops
and Establishments Act, 1953, could file an application u/s 26(2). [95B]
Even persoos employed in a factory by the inclusive clause in the second
5entence of the definition in S. 2(4) are employees within the meaning of the
Bihar Act.
But hvo exceptions have been carved ou~ from the category of
such persons, namely, ( l) "Who are not workers within the meaning of tbc
Factories Act", such CJ> worker does not come withi•.1 the inclusive definition of
F
the term emoloyee; (2) who <'!re ncn v:orking in a managerial capaciey.
I'll
other words even a person employed in a factory and who is not n \1/0rker
within the meaning of the factories Act will not be an employee u/s 2 ( 4)
of
the Bihar Act, if he is working in a managerial capacity.
[95D-F]
Reading clause ( 1) of s. 2 of f1he Factories Act, 1948, together \\'ith ctausr
(k) and (m) thereof. it is dear that a person to be a \Vorker withfn the rnca-ning of the1 Factorie:~ Act rnu5t b~ a person employed i11 the premises or the
precincts of the factory.
f96Cl
G
Sta'e of U.P. v. M. P. Singh & Ors .. [1960] 2 SCR 605 reiterated.
Raw materi2,1s used, in the manufacturing process for producing paper and
i~ various products, undoubtedly. will be a
"subject of the
rnainufacturing
process'' within the meaning of clnuse 1 of section 2 of the Factories
Act.
whatever also may be or n1ay not be such subject.
[97A-B]
In the instant case, the
respo)l<lent was not
working in a
manageria·l
H
.capacity.
Though
he
was
not employed "in any manufacturing process or
in cleaning any part of the machinery or premises used for a manufacturing
process'', he was engaged in
a
work
\Vhich
was
connected
with
the
'
;
94
SUPREME COURT REPORTS
(1978] 3 S.C.R.
A
··~!Jbject of the J!lanufacturing proce~s'' and therefore, he was a factory \vorker
\V1th1n the meaning of clause ( 1) of s. 2 of the Factories Act, 1948.
He.nee
he was not an employee within the meaning of the Bihar Shops and Establishment<; Act, 1953.
The petition of complaint filed by him u/s 26(2) was
not
maintainable.
r96G, 97B.Cl
B
CIV!r. APPELLATE JURISDICTION: Civil Appeal
No. 1821
of
1977.
(Appeal by Special Leave from the Judgment and Order dated
19th August, 1976 of a Bench of High Court of Patna in C.W.J.C.
No. 650 of 1973).
A. B. N. Sinha, B. P. Maheshwari and Suresh Sethi for
the
Appellant.
C
Lal Narain Sinha, P. P. Singh & H. S. Marwah for Respondent
D
E
F
G
H
No. 1.
The Judgment of the Court was delivered by
UNTWAL!A, J.-This is an appeal by special leave.
Shri Ramlakhan Singh, respondent no. 1 (for brevity, hereinafter called the
respondent) was an employee of M/s Rohtas Industries Ltd.,
the
api:ellant.
The appellant runs a Paper Factory at Dalmianagar in
the_ State of Bihar, wherein paper is manufactured for sale from rawmaterials such as bamboo, cotton rags and waste paper etc. The respondent was appointed and employed in the Waste Paper Department
of the Paper Factory and had been working as Sectional Officer in
the said Department since 1964.
The management received information from one of its dealers, M/s G. D.-Bansal of Gwalior, that the
respondent was acting against the interest of the Company and was
divulging its secrets and confidential matters to outsiders for monetary
considerations.
Thereupon the ·management terminated toe"· services
of the respondent by a notice dated the 10th of June, 1970 with
immediate effect, and according to its case, it had offered one month's
wages in lieu of notice.
TI1e respondent assailed the order of his
termination by making a complaint in writing to the Labour Court,
Patna under section 26(2) of the Bihar Shops & Establishments Act,
1953--hcreinafter called the Bihar Act.
His case was that he was
discharged from service without any rhyme and reason, no domestic
enquiry was held to prove any charge against him, nor was he offered
any wages in lieu of one month's notice,
The appellant contested the
respondent's petition of complaint on merits as well as on the technical
ground that it was not maintainable under the Bihar Act inasmuc)l
as t11e respondent was not an employee within the meaning of section 2 ( 4) of the said Act.
The Labour Court tried the issue of maintainabillty of the petition of complaint as a preliminary issue and by its order dated the
29th May, 1972 held that the respondent was not a factory worker
within the meani'ng of section 2(1) of the Factories Act, 1948 and
hence was an einployee within the meaning of the Bihar Act.
The
appellant moved the High Court by a writ petition against the said
order of the Labour Court but was asked to agitate this point after
'
t
j
ROHTAS INDUSTRIES v. RAMLAKHAN (U111wa/ia, J.)
95
the final decision was made by that Court.
The Labour Court on
A
merits, decided the matter on the 2Stb of February, 1973 and aliowed the petition of the respondent and ordered his reinstatement with
full back wages.
The appellant challenged the orders of the Labour
Court by a fresh writ petition but the Patna High Court dismissed it.
Hence . thi3 appeal.
W c need not discuss or decide the merits of the respective cases
of the parties, as in our opinion, the application filed by the respoiident under section 26(2) of the Bihar Act was not maintainable.
Only a person who is an employee under section 2 ( 4) of the Bihar
Ac.t could file an application under section 26 (2). If he was not such
an employee, he had no right to file the complaint.
Section 2 ( 4)
reads· a~ follows :
" 'employee' means a person wholly or partially employed for hire, wages including salary, reward, or commission
in, and in connection with, and establishment and" includes
1
'apprentice', but docs not include a member of the employers'
family.
It also includes persons employed in a factory who
are not workers within the meaning of the Factories Act,
1948 (LXIII of 1948) and who are not working in managerial capacity, and for the purposes of any proceeding under
this Act, include an employee who has been dismissed, discharged or retrenched for any reason whatsoever."
On a plain reading of the definition aforesaid, it follows that even ~r·
sons employed in a factory by the inclusive clause in the second sentence of the definition are employees within the meaning of the Bihar
Act.
But lwo exceptions have been carved out from the category of
such persons, namely, (I) "who are not workers within the meaning
of the Factories· Act"; such a worker does not come within the faclllsive definition of the term 'employee'; (2) who are not working in
'managerial capacity'. In other words, even a person employed in a
Factory and who is not a worker within the meaning of the Factories
Act will not be an employee under section 2 ( 4) of the Bihar Act if
he is working in a managerial capacity. It is not disputed that tiie
second exception was not attracted in this case. The respondent was
not working in a managerial capacity.
He was employed in
the
Paper Factory. But the only question for determination is whether
he was a worker within the meaning of the Factories Act.
For the purpose of deciding the point at issue, it is necessary to
refer to certain provisions of the Factories Act as they stood at the
relevant time before the Factories Amendment Act, 1976. The title
and. the preamble of the Act would show that this is an Act "to consolidate and amend the law regulating labour in factories."
Clause (1)
of section 2 runs as follows :
" 'worker' means a person employed, directly or through
any agency, whether for wages or not, in any manufacturing
procers, or in cleaning any part of the machinery or premises
B
c
D
E
F
G
H
A
B
c
D
96
SUPREME COURT REPORTS
[J 978] 3 S.C.R.
used for a manufacturing process, or in any other kind of
work incidental to, or connected with, the manufacturing
process, or the subject of the manufacturing process."
The definition of "factory" given in clause (m) starts by saying .that
it "means any premises including the precincts thereof." Manufacturing process has been defined in clause (k) to mean any process
for-
(i) making, altering, repairing,
ornamenting,
finishing,
packing, oiling, washing, cleaning, breaking up, demolishing, or otherwise
treating or <1dopting any
article or substance with a view to its use, sale, trans~
port, delivery or disposal, or .................. "
Reading these provisions together, it is quite reasonable and legitimate
to hold thal a person to be a worker within the meaning of
the
Factories Act must be a person employed in the premises or the
precincts of the factory.
As held by this Court in The State of Uttar
Pradesh v. M. P. Singh and others(') field workers who are employed
in guiding, supervising and controlling the growth and supply
of
sugarc~ne to be used in the factory are not employed either in the
precincts of the factory or in the premises of the factory.
Hence the
provisions of the Factories Act do not apply to them.
According to the finding of the Labour Court, the respondent was
E ·engaged in supervising and checking quality and weighment of waste
papers and rags which are the basic raw-materials for the manufacture
of Duplex Board and Vulcanised fibre.
He used to deal with receipts
and maintain records of stocks.
He also used to pass the bills oT the
suppliers of the waste paper and rags and used to check the quality
of the supplies.
The respondent had admitted thaf he used to work
in the precincts of the factory and in case of necesSities had to work
inside the factory.
He used to go to the paper sorting house when
there were instructions for it.
Bu\ thinking that checking of rags and
F
G
H
their quality was not the main duty of the respondent, the Court came
to the conclusion that his work was not incidental to manufacturing
process
The High Court thought that the Labour Court nad founa
as a fact that the respondent was not concerned with the manufacturing of paper either directly or incidentally and hence he was not a
factory worker.
In our opinion, the judgments of the Courts below
in this regard cannot be sμstained.
The respondent was not employed "in any manufacturing ~ocess
or in cleaning any part of the machinery or premises used for a-ma11ufacturing process." But the question for consideration is whether
he was employed in "any other kind of work incidental to, or connected with, the manufacturin~ process or the subject of the manufacturing process." This Court in State of U.P. v. M. P. Singh (supra) did
(I) [1960] 2 S.C.R. 605 ..
'
ROHTAS INDUSTRIES v. RAMLAKHAN (Untwalia, J.)
97
not dc,·ide as to what was the precise meaning of the expression "snbA
jcct of the manufacturing process" in section 2 clause (1) of
the
Factorie, Act.
We are called upon to decide this question in this
appeal.
Raw material used in !he manufacturing process for producing paper and its various products, undoubtedly, will be a "subject of the manufacturing process," whatever else may or may not be
such subject If that be so, the respondent was engaged in a work
which was connected with the subject of the manufacturing process.
And as we see the evidence discussed in the order of the Labour Court,
there cannot be any doubt that he was working in the factory premises
B
or its precincts in connection with the work of the subject of
the
manufacturing process namely, the raw-materials.
In our judgment,
therefore, he was a factory worker within the meaning of clause ( 1)
of sectfon 2 of the Factories Act, 1948.
Hence he was not an employee within the meaning of the Bihar Act and the petition of complaint filed by him under section 26(2) was not maintainable.
We accordingly allow this appeal, set aside the judgment and order
of the High Court as also those of the Labour Court and dismiss the
petition of complaint filed by the respondent.
As per the order of
thb Court made earlier the appellant must pay the cost in this appeal
to Respondent No. 1.
Befor,· we part with this case, we would like to put on record that
Mr. A. B. N. Sinha appearing for the appellant management assured
us that whatever money has been paid to the respondent in lieu of
wages so far pursuant to the interim order of the High Court or o[
c
D
this Court will not be claimed back from him.
We think that the
amount w paid should furnish a sufficient compensation to the resE
pendent for losing his service.
S.R.
Appeal allowed.