# SHRI BIRDHICHAND SHARMA v. FIRST CIVIL JUDGE NAGPUR AND OTHERS

- **Citation:** [1961] 3 S.C.R. 161
- **Court:** Supreme Court of India
- **Decided:** 1961
- **Bench:** P. B. Gajendragadkar, K. N. Wanchoo
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/shri-birdhichand-sharma-v-first-civil-judge-nagpur-and-others-1949
- **Pages:** 7

## Headnote

Industrial Dispute-Workers in bidi factory-Liberty to come
and go when they liked-Payment on piece-rate-Control by rejection of work not upto the standard-If workmen-Test-Factories
Act, z948 (LXIII of z948), ss. 2(l) and 79.
The appellant employed workmen in his bidi factory who
had to work at the factory and were not at liberty to work at
their houses; their attendance were noted in the factory and
they had to work within the factory hours, though they were
not bound to work for the entire period and could come and go
away when they liked; but if they came after midday they were
not supplied with tobacco and thus not allowed to work even
though the factory closed at 7 p.m.; further they could be removed from service if absent for 8 days. Payment was made
on piece rates according to the amount of work done, and the
bidis which did not come upto the proper standard could be
rejected.
The respondent workmen applied for leave for 15 days and
did not go to work, for which period the appellants did not pay
their wages; in consequence the concerned workmen applied to
the Payment of Wages Authority for payment of wages to them.
The appellant's contention that the respondent workmen were
not his workmen within the meaning of the Factories Act, was
rejected and the claim for payment of wages was allowed. The
question therdore was whether the appellants were workmen
within the meaning of the Factories Act.
Held, that the nature of extent of control varies in different
industries and cannot by its very nature be precisely defined.
When the operation was of a simple nature and could not be
supervised all the time and the control was at the end of day
by the method of rejecting the work done which did not come
up to proper standard, then, it was the right to supervise and
not so much the mode in which it was exercised which would
determine whether a person was a workman or an independent
con tractor.
The mere fact that a worker was a piece-rate worker would
not necessarily take him out of the category of a worker within
the meaning of s. 2(1) of the Factories Act. In the instant case'
the respondent workmen could not be said fo be independent
contractors and were workmen within the meaning of s. 2(1) of
the Factories Act.
He/,l, further, that the leave provided for under s. 79 of the
Factories Act arose as a matter of right when a worker had put
..
December 9.
•
162
SUPREME COURT REPORTS
[1961]1
'960
in a minimum nnmber of working days and he was entitled to
'h . -. -.
it. The fact that the workman remained absent for a longer
.5 " lludhicha"d period had no bearing on his right to leave.
01
'
0
'"'"
State v. Shankar Balaji·Waje; .U.R. U)6o Rpm. 296, approv.
d
Fi1st Cii,.il
fudge ve ·
Nagpu' & Oth<1s
Dharangadhara Chemical Works Ltd. v. State of Saurashtra,
[1957] S.C.R 152 and Shri Chintaman Rao v. The State of
Madhya Pradesh, [1958] S.C.R. 1340, referred to.
CIVIL
APPELLA'l'E
JURISDICTION: Civil
Appeal
No. 370 of 1959.
Appeal by special leave from the judgment and
order dated August 6, 1957, of the Bombay High
Court, Nagpur, in Misc; Petition No. 512 of 1956.
M. N. Pharlke and Naunit Lal, for the appellant.
Shankar Anand and A.G. Ratnaparkhi, for the respondents Nos. 2-4.
N. P. Nathvahi, K. L. Hathi and R. H. Dhebar, for
the Intervener (State of Bombay).
1960. December 9.
The Judgment of the Court
was delivered by
wan,hoo J.
WANOHOO, J.-This is an appeal by special leave in
an industril)>I matter. The appellant is the manager
of a biri factory in Nagpur. Respondents 2 to 4 are
working in that factory. They applied for leave for
fifteen days from December 18, 1955, to January 1,
1956, and did not go· to work during that period. The
appellant did not pay their wages for these days and
in consequence they applied to the Payment of Wages
Authority (hereinafter called t.he Authority) for pa:)'·
ment to them of wages which had been withheld.
Their claim was that they were entitled to fifteen
days' leave in the year under ss. 79 and 80 of the
:

## Text

3 S.C.R. SUPREME COURT REPORTS
161
SHRI BIRDHICHAND SHARMA
v.
FIRST CIVIL JUDGE NAGPUR AND OTHERS.
(P. B. GAJENDRAGADKAR and K. N. WANCHOO, JJ.)
Industrial Dispute-Workers in bidi factory-Liberty to come
and go when they liked-Payment on piece-rate-Control by rejection of work not upto the standard-If workmen-Test-Factories
Act, z948 (LXIII of z948), ss. 2(l) and 79.
The appellant employed workmen in his bidi factory who
had to work at the factory and were not at liberty to work at
their houses; their attendance were noted in the factory and
they had to work within the factory hours, though they were
not bound to work for the entire period and could come and go
away when they liked; but if they came after midday they were
not supplied with tobacco and thus not allowed to work even
though the factory closed at 7 p.m.; further they could be removed from service if absent for 8 days. Payment was made
on piece rates according to the amount of work done, and the
bidis which did not come upto the proper standard could be
rejected.
The respondent workmen applied for leave for 15 days and
did not go to work, for which period the appellants did not pay
their wages; in consequence the concerned workmen applied to
the Payment of Wages Authority for payment of wages to them.
The appellant's contention that the respondent workmen were
not his workmen within the meaning of the Factories Act, was
rejected and the claim for payment of wages was allowed. The
question therdore was whether the appellants were workmen
within the meaning of the Factories Act.
Held, that the nature of extent of control varies in different
industries and cannot by its very nature be precisely defined.
When the operation was of a simple nature and could not be
supervised all the time and the control was at the end of day
by the method of rejecting the work done which did not come
up to proper standard, then, it was the right to supervise and
not so much the mode in which it was exercised which would
determine whether a person was a workman or an independent
con tractor.
The mere fact that a worker was a piece-rate worker would
not necessarily take him out of the category of a worker within
the meaning of s. 2(1) of the Factories Act. In the instant case'
the respondent workmen could not be said fo be independent
contractors and were workmen within the meaning of s. 2(1) of
the Factories Act.
He/,l, further, that the leave provided for under s. 79 of the
Factories Act arose as a matter of right when a worker had put
..
December 9.
•
162
SUPREME COURT REPORTS
[1961]1
'960
in a minimum nnmber of working days and he was entitled to
'h . -. -.
it. The fact that the workman remained absent for a longer
.5 " lludhicha"d period had no bearing on his right to leave.
01
'
0
'"'"
State v. Shankar Balaji·Waje; .U.R. U)6o Rpm. 296, approv.
d
Fi1st Cii,.il
fudge ve ·
Nagpu' & Oth<1s
Dharangadhara Chemical Works Ltd. v. State of Saurashtra,
[1957] S.C.R 152 and Shri Chintaman Rao v. The State of
Madhya Pradesh, [1958] S.C.R. 1340, referred to.
CIVIL
APPELLA'l'E
JURISDICTION: Civil
Appeal
No. 370 of 1959.
Appeal by special leave from the judgment and
order dated August 6, 1957, of the Bombay High
Court, Nagpur, in Misc; Petition No. 512 of 1956.
M. N. Pharlke and Naunit Lal, for the appellant.
Shankar Anand and A.G. Ratnaparkhi, for the respondents Nos. 2-4.
N. P. Nathvahi, K. L. Hathi and R. H. Dhebar, for
the Intervener (State of Bombay).
1960. December 9.
The Judgment of the Court
was delivered by
wan,hoo J.
WANOHOO, J.-This is an appeal by special leave in
an industril)>I matter. The appellant is the manager
of a biri factory in Nagpur. Respondents 2 to 4 are
working in that factory. They applied for leave for
fifteen days from December 18, 1955, to January 1,
1956, and did not go· to work during that period. The
appellant did not pay their wages for these days and
in consequence they applied to the Payment of Wages
Authority (hereinafter called t.he Authority) for pa:)'·
ment to them of wages which had been withheld.
Their claim was that they were entitled to fifteen
days' leave in the year under ss. 79 and 80 of the
:Factories Act, 1948. The Authority allowed the claim
and. granted them a sum of Rs. 90/6/· in all as wages
which had been withheld for the period of leave.
Thereupon, the appellant filed an application under
Art. 226 of the Constitution before the High Court at
Nagpur. His main contention was that respondents
2 to 4 were not workers within the meaning of the
Factories Act and could not therefore claim t.he benefit
3 s.c.R. SUPREME COURT REPORTS
163
of s. 79 thereof. The respondents contended that they
'~
60
were workers within the meaning of the Factories Act Shri Birdhitha»d
and were entitled to the sum awarded to them by the
Shanna
Authority. The High Court on a consideration of the
"·
circumstances came to the conclusion that respondents First Cfoil Judg•
2 to 4 were workers under s. 2(1) of the Factories Act ~'agp .. r <>- Others
and therefore the order of the Authority was correct
and dismissed the petition. The appellant then applied for a certificate to appeal . to this Court which was
refused. He then obtained special leave from this
Court and that is how the matter has come up before
us.
Sec. 2(1) defines a worker to mean a person employed, directly or through any agency, whether for
wages or not, in any manufacturing process, or in
cleaning any part of the machinery or premises 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 main contention of the appellant is that
respondents 2 to 4 are not employed in the factory
within the meaning of that word in s. 2(1).
Reliance
in this connection is placed on two decisions of this
Court, namely, Dharangadhara Chemical Work.• Ltd. v.
State of Saurashtra (')and Shri Chintaman Rao v. The
State of Madhya Pradesh(').
In Dharangadhara Chemical Work.s ('), this Court
held with reference to s. 2 (s) of the Industrial Disputes Act, which defined "workman" that the word
"employed" used therein implied a relationship of
master and servant or employer and employee arid it
was not enough that a person was merely working in
the premises belonging to another person.
A distinction was also drawn between a workman and an
independent contractor. The prima faeie test whether
the relationship of master and servant or employer
and employee existed was laid down as the existence
of the right in the employer not merely to direct what
work was tq be done but also to control the manner
in which it was to be done, the nature or extent of
such control varying in different industries and being
(1) [1957] S.C.R. 152.
(2) [1958] S.C.R. 1340
TVanchaa ].
164
SUPREME COURT REPORTS
[1961]
zy6o
by its natl)re incapable of being precisely defined. The
Sh . 8
dh. h
d correct a pp roach therefore to the question was held to
"
51'.:,,,:; •• be whether having regard to the nature of the work,
v.
there was due control and supervision of the employer.
Ffrst Civil Judge
The matter came up again for cons.ideration in
Nagpur & Others Chintaman Rao's case(') wliich also happened to relate
w --;: 1
to biri workers, and s . .2(1) of the Factories Act had to
.,,,
00
•
be considered in it. It was held that the test laid
down in Dharangadhara Chemical Works (2) with respect
to s. 2(s) of the Industrial Disputes Act would also
apply to s. 2(1) of the Factories Act. Finally, it was
pointed out that the question whether a particular
person working in a factory was an independent non.
tractor or a worker would depend upon the terms uf
the contract entered into between him and the employer and no general proposition could be laid down,
which would apply to all cases. Thus in ordl'r to
arrive at the conclusion whether a person working in
a factory (like respondents 2 to 4 in this case) is un
independent contractor or a worker the matter would
depend upon the facts of each case.
Let us then turn to the facts which have been found
in this case. It has been found that the respondents
work at the factory and are not at liberty to work at
their homes.
Further they work within certain hours
which are the factory hours, though it appears that
they are not bound to work for tho entire period and
can go away whenever they like; their attendanre is
noted in the factory; and they can come and go away
at any time they like, but if any worker comes after
micrnay he is not supplied with tobacco and is thus not
allowed to work, even though the faetory closes at 7
p.m. in accordance with the proviHions of the Factories Act and when it is said that they can return at
any time, it is subject to the condition that they
cannot remain later than 7 p.m. There are standing
orders in the factory and according to those standing
orders a worker who remains absent for eight days
(presumably without leave) can be removed. The
payment is made on piece-rates according to the
amount of work done but the man:i-gement has the
(1) [1958) S.C.R. 1340.
(2) [1957] S.C.R. 152.
I
3 S.C.R. SUPREME COURT REPORTS
165
right to reject such biris as do not come up to the
'960
proper standard. It is on these facts that we have to Sh.i Birdhic/.and
decide the question whether respondents 2 to 4 were
Shanna
employed by the appellant.
v.
It will be immediately noticed that the facts in this Fi"' Civil Judgt
case are substantially different from the facts in Shri Nagpu, & Othm
Chintaman Rao's case (1). In that case the factory
h . d
d
lVanchoo J.
entered into contracts wit
m epen ent contractors,
namely, the Sattedars, for the supply of biris. The
Sa.ttedars were supplied tobacco by the factories and
in some cases biri leaves also. The Sattedars were not
bound to work in the factory nor were they bound to
prepare the biris themselves but could get them prepared by others. The Sattedars also employed some
coolies to work for them and payment to the coolies
was made by the Sattedars and not by the factory.
The Sattedars in their turn collected the biris prepared by the coolies and took them to the factory where
they were sorted and checked by the workers of the
factory and such of them as were rejected were taken
k ·k by the Sattedars to be re-ma.de. The payment by
the factory was to the Sattedars and not to the coolies.
In these circumstances it was held that the Sattedars
were independent contractors and the coolies who
worked for them were not the workers of the factory.
The facts of the present case, however, are diffo.
rent. Respondents 2 to 4 have to work at the factory
and that in itself implies a certain amount of supervi.
sion by the management. Their attendance is noted
and they cannot get the work done by others but
must do it themselves. Even though they are not
bound to work for the entire period during which the
factory is open it is not in dispute that if they come
after midday, they are not given any work and thus
lose wages for that day, the payment being at piecerates. Further though they can stay away without
asking for leave, the management has the right to
remove them if they so stay away for a continuous
period of eight days. Lastly, there is some amount
of sutJervision inasmuch as the management has the .
right of rejection of the biris prepared if they do not
come up to the proper standard.
(1) [19;BJ s.c.R. 1340.
166
SUPREME COURT REPORTS
(19Cl]
i96u
The question therefore that arises is whether in
5.h . 8-:-dh. h
d these circumstances it can be said whether the appelrt
H
tc an 1
a·
.
Shanna
ant merely ,1rects what work IS to be done but cannot
v.
control the manner in which it has to be done; of
Ffrst Civil ft1dge course, the nature or extent of control varies in diffeNagpu. & Others rent industries and cannot by its very nature be preci-
-
sely defined.
Taking the n::iture of the work in the
rvanchoo ].
present case it c::in hardly be said that there must be
supervision all the time when biris are being prepared
and unless there is such supervision there can be no
direction as to the manner of work. In the present
case the operation being a simple one, the control of
the manner in which the work is done is exercised
at the end of the day, when biris are ready, by the
method of rejecting those which do not come up to
the proper standard. In such a case it is the right to
supervise and not so much the mode in which it is
exercised which is important. In these circumstances,
we are of opinion that respondents 2 to 4 who work
in this factory cannot be said to be independent contractors.
The limited freedom which respondenlH 2
to 4 have of coming and going away whenever they
like or of absenting themselves (presmrnihly with•,ut.
leave) is due to the fact that they are piece-rate workers; but the mere fact that a worker is a piece-rate
worker would not necessarily take him out of the
category of a worker within the meaning of s. 2(1) of
the Factories Act. Considering~the entire circumstances
and particularly the facts that if the worker does not
reach the factory before midday he is given no work,
he is to work at the factory and cannot work elsewhere, he can be removed if he is absent for eight da.ys
continuously :tud finally his attendance is noted and
biris prepared by him are liable to reject.ion if they do
not come up to the standard, there can be po doubt
that respondents 2 to 4 are workers within the men.ning of s. 2(1) of the Factories Act..
This is also the
view taken by the Bombay High Court in State v.
8hankar Balaji Waje (') in similar circumstances and
that we think is the right view.
Then it was urged that even if the re,;pondents are
(I) A.LR. 1960 Bc1m. 296.
I
3 S.C.R. SUPREME COURT REPORTS
J67
workers under s. 2(1), s. 79 should not be applied to
Ig6o
them as they can absent themselves whenever they Shri Biidhichalid
like. In this very case it is said that the respondents
s1mma
remained absent for a longer period than that providv.
ed in the Act and therefore they do not need any Ffrst Civil Judge
leave. This argument has in our opinion no force. Nagpur & Others
The leave provided under s. 79 arises as a matter of
n·a,,chou J.
right when a worker has put in a minimum number of
working days and he is entitled to it. The fact that
the respondents remained absent for a longer period
·than that provided in s. 79 has no bearing on their
right to leave, for if they so remained absent for such
period they lost.the wages for that period which they
would have otherwise earned. That however does
not mean that they Rhould also lose the leave earned
by them under s. 79. In the circumstances they were
entitled under s. 79 of the Factories Act to pro portionate leave during the subsequent calendar year if
they had worked during the previous calendar year
for 240 days or more in the factory. There is nothing
on the record to show that this was not so.
In the
circumstances the appeal fails and is hereby dismissed
with costs. One set of hearing costs.
Appeal dismissed.
VOLTAS LIMITED
v.
ITS WORKMEN
(P. B. GAJENDRAGADKAR, K. N. WANCHOO and
K. C. Das GUPTA, JJ.)
Industrial Dispute--Bonus-Contribution to political fund, if
can be deducted from gross profit-Extraneous income-Nature ofSalesmen and apprentices, if entitled to bonus.
The question in this appeal was whether the Tribunal was
wrong in not allowing the amount paid to a political fund which
wa~ perm1ss1blc. as an ite~ of expense and for disallowing tbe
claun for deduction of certain amounts as extraneous income and
\Vhether the sal('smen and apprentices were entitled to bonus.
Ig6o
D1ce1nber 9.