The High Court dismissed the appeal challenging an Industrial Tribunal award that held contracts for gardening work at BPCL's refinery were bogus and declared workers to be permanent employees.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
Writ Petition No. 584 of 2008
Bharat Petroleum Corporation Ltd. )
a company incorprorated under the )
companies Act, 1956 having its )
Registered Office at Bharat Bhavan)
Ballard Estate, Mumbai 400 038 ) ..Petitioner
vs.
1. Petroleum Employees’ Union )
a Union registered under the )
Trade Unions Act, 1926 & having)
its office at Rasayan Bhavan )
Tilak Road, Dadar (East), )
Mumbai 400 014 )
2. Shri Sunil Kashinath Dasade )
of Mumbai, Indian Inhabitant )
residing at Varna Building no. )
10/319, Lallubhai Compound )
Mankhurd, Mumbai 400 013 )
3. Shri Raju R.Subbaya, Proprietor)
M/s Subash Gardens, having his )
address at Shivam Building No. )
241D, 2nd floor, Aziz Baug, )
Mahul Road, Chembur, )
Mumbai 400 074 )
4. Shri C.K.Ramchandran, )
Proprietor, M/s R.R.Enterprises)
having his address at Navjeevan)
Cooperative Housing Society Ltd)
Building No.17/B, Flat No.5, )
R.C.Marg,Chembur, Mumbai-400074)
5. Shri A.A.Lad, Presiding Officer)
Central Government Industrial )
Tribunal No.2, having his Court)
at Shram Raksha Bhavan, )
Shivshruti Off.Priyadarshi Park)
Mumbai ) ..Respondents
Mr.J.P.Cama, Sr.Advocate with Mr.R.S.Pai and Ms.Pallavi
Dedhia for petitioner.
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Mr.A.V.Bukhari with Mr.B.J.Sawant and Mr.R.B.Sawant for
respondent Nos.1, 3 and 5.
Mr.A.D.Shetty for respondent Nos.3 and 4.
CORAM: S.C.DHARMADHIKARI J.
JUDGMENT RESERVED ON : 24.04.2008.
JUDGMENT DELIVERED ON :20.06.2008.
J U D G M E N T:
1. Rule. Mr.Sawant appearing for respondent nos.1 and 2
waives service. Mr.Ashok Shetty waives service for
respondent nos. 3 and 4. Service on respondent no.5
dispensed with. By consent, rule made returnable
forthwith and heard.
2. By this petition under Article 226 of the Constitution
of India, the petitioners are challenging the Award dated
23rd October, 2007 which has been delivered by the Central
Government Industrial Tribunal No.II at Mumbai in
Reference No.CGIT-2/34 of 2002.
3. By the impugned Award the CGIT directed as under:
" ORDER
a) Reference is allowed.
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b) It is declared that Contractor/Contract is
bogus;
c) Bharat Petroleum Corporation Ltd., is directed
to treat these workmen involved in reference as
their employees and give them benefits directly
instead of giving through their Contractors.
d) Bharat Petroleum Corporation Ltd. is also
directed to consider these employees as its
permanent employees and give all benefits which are
attracted by permanent employees of it along with
wages and other benefits.
e) No order as to its costs."
4. The petitioners Bharat Petroleum Corporation Ltd.
(for short BPCL) being aggrieved and dissatisfied with the
above directions and Award have preferred this petition
under Article 226 of the Constitution of India challenging
the same. The petitioners - BPCL - were impleaded as
First Party No.1 to the above reference whereas respondent
nos. 3 and 4 along with another party (M/s Heritage
Garden) were impleaded as first party nos. 2 to 4.
Respondent Nos. 1 and 2 before me along with 23 others
were impleaded as second party.
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5. It is not in dispute before me that the Government of
India, Ministry of Labour by order dated 28th March, 2002
passed in exercise of powers conferred by Clause (d) of
sub-section (10) and sub section (2A) of section 10 of the
Industrial Disputes Act,1947 made a reference to CGIT,
Mumbai for deciding the following issues.
"(i) Whether the contract between Bharat Petroleum
Corporation Ltd. and the contractor is a sham and
bogus one and is a camouflage to deprive the
concerned employees of the benefits available to
permanent workmen of Bharat Petroleum Corporation
Ltd.?
(ii) Whether the concerned workmen employed as
gardeners should be declared as permanent workmen
of the Bharat Petroleum Corporation Ltd.?
(iii) What are the wages and consequential benefits
to be paid to the concerned employees?"
6. It is necessary to refer to the factual background
which led to the making of reference.
7. It is not in dispute before me that a writ petition
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being Writ Petition No.800 of 1996 was filed by respondent
no.1 Union in this Court and it prayed for issuance of a
writ, order or direction to Bharat Petroleum and other
concerned Government functionaries that the employees
represented by the first Union should be treated as
workmen/employees of the Petroleum Corporation and be paid
wages on par with regular employees. A relief of
declaration to the above effect was claimed. The parties
to the writ petition were the petitioner-Corporation
before me so also the Union of India and the Secretary of
the Central Advisory Contract Labour Board and Regional
Labour Commissioner. One private party, namely, Modern
Farms and Gardens was joined as respondent no.6 to the
petition.
8. The petition proceeds on the basis that the Petroleum
Corporation is a Government of India undertaking operating
through out the country and is incharge of distribution of
petroleum products. It is engaged in refining and
processing of oil at the refineries located at various
places. One such refinery is situated at Mahul, Chamber
in Mumbai. It has been pointed out that the said
Corporation requires permanent workers in this refinery
for the purpose of maintaining gardens and lawns located
in the campus. It was contended that these gardens and
lawns have to be statutorily maintained by the Petroleum
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Corporation at the refinery. The gardening work is of
permanent and perennial nature. A list of workers was
annexed to the petition as Annexure A and it was urged
that these workers have been employed for the purpose of
maintaining lawns and gardens, by the petitioners, on
contract basis. However, they have been employed as such
for years together. It was urged that the work is taken
and extracted by the Petroleum Corporation. There are
entry permits and passes issued to the workers by the
Petroleum Corporation. The work is incidental and
ancillary to the maintenance of the refinery and its
operations by the Petroleum Corporation. The regular
employees in the establishment of the Petroleum
Corporation have been carrying out this work at different
places in India. The work is also being done at the
administrative premises, interalia, known as "Petroleum
House" in South Mumbai. In the said writ petition, it was
also urged that the main activity of Petroleum Corporation
is to refine crude oil and to market the same in various
parts of the country,. The Petroleum Corporation employs
about 2,000 regular workmen at its Refinery at Mahul. The
Union stated that the workmen and the employees are
engaged for maintenance of Garden and other such
activities. The Union urged that the Petroleum
Corporation required large number of permanent workers at
these places to carry out their regular and day to day
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work.
9. The Union stated that the Petroleum Corporation has
employed about 2000 regular employees in its Refinery who
are employed on regular basis who get much more beneficial
service conditions than what the contract labour get.
There is no job security to the contract workers besides
no retirement benefits, leave, medical assistance,
travelling, housing etc.
10. The Union further urged that the said work is of
perennial and permanent in nature and required to be done
all throughout the year without any break and, therefore,
it was just and necessary that the Petroleum Corporation
ought to have employed the employees whose names are
listed in Exhibit A to the said petition on permanent
basis. The Union stated and submitted that even in the
establishment of the Petroleum Corporation the said work
is carried out and attended to by the regularly employed
workers. Similarly, the same work is being carried out
and attended to in other establishments by employing
regularly employed workmen and hence the action of
employing these employees on contract basis is unjust,
arbitrary, illegal and unconstitutional. The Petroleum
Corporation being a State was supposed to act as a model
employer. There is no justification for keeping these
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employees on contract basis for years together.
11. The Union stated that besides employing contract
labour through the Respondent No.6, the Petroleum
Corporation has been directly employing regular employees
to carry out similar work which is being carried out by
the employees listed in Exhibit A to the petition. In
fact, both the types of employees discharge the same and
similar type of work and in fact and in law there is no
material difference between them in any way. Both these
groups of employees do the similar nature of work, possess
same qualifications. There work is supervised, controlled
by the Officers of the Petroleum Corporation. Both these
groups work in the same establishment under the common
supervision, however, the contract labour get much
inferior service conditions than what the regular
employees get. However, the regularly employed workmen
get higher salary than those employed through the
contractors. The Union stated that under law, they are
entitled to receive the same salary as is the salary paid
to the regularly employed employees. Nevertheless the
workers regularly employed by the Petroleum Corporation
are in receipt of monthly wages of Rs.3500/- to Rs.7,000/-
with all other benefits which is sharp in contrast with
the contract labour listed at Exhibit A hereto who receive
a meagre amount of Rs.1,500/- to Rs.1,800/- per month.
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The Union stated that a separate seniority list is
maintained for the employees employed through the
contractors and employees who are directly employed by the
Petroleum Corporation on permanent basis.
12. It was upon these allegations that it was contended
that the Petroleum Corporation removed three employees
with an intent to pressurise them and other contract
workers. The employees who are part of the writ petition
are also threatened with similar action and therefore, the
writ petition was moved and the above mentioned
declaratory and other reliefs were claimed.
13. It is not in dispute that this writ petition was
placed before this Court on 8th January, 1997 and
following order was passed:-
"P.C.
Rule, returnable on 17th March, 1997. Respondent
No.1 waives service.
Respondent No.1 not to terminate the services of
the contract workmen mentioned in Exh.A except on
the ground of misconduct. It is, however, made
clear that it will be open for the Respondent No.1
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to engage another contractor subject to condition
that the workmen listed in Exh.A are continued."
14. Thereafter, this writ petition appeared for hearing
and final disposal before a Division Bench of this Court
on 9th October, 2001. The Petroleum Corporation placed
reliance upon the decision of the Hon’ble Supreme Court
reported in 2001 III CLR page 349 (Steel Authority of
India Ltd.and others Vs.National Union Water Front Workers
to urge that a writ petition under Article 226 of the
Constitution of India is not maintainable for claiming
reliefs prayed for in the writ petition no.800 of 1996.
The remedy is as directed by Hon’ble Supreme Court in the
said decision. Accepting this objection raised by the
Petroleum Corporation and Central Government, the Division
Bench disposed of the writ petition by following order.
"5. Consequently we dispose of the writ petition
by the following order.
(1) The Appropriate Government i.e. the Central
Government (as agreed to by both the learned Senior
Counsel is directed to make Reference of the
following demand to the Industrial Tribunal for
adjudication within two months from today:-
(i) Whether the Contract between Bharat Petroleum
Corporation Limited and the Contractor is a sham
and bogus one and is a camouflage to deprive the
concerned employees of the benefits available to
permanent workman of Bharat Petroleum Corporation
Limited?
(ii) Whether the concerned workmen employed as
gardeners should be declared as permanent workmen
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of the Bharat Petroleum Corporation Limited?
(iii) What are the wages and consequential
benefits to be paid to the concerned
employees"
2. The Industrial Tribunal should then decide the
reference as expeditiously as possible and in no
case later than 31.12.2002.
3. Interim order passed by this Court on 8.1.1997
is ordered to remain operative till the disposal of
the Reference by the Industrial Tribunal.
No costs."
15. It is in pursuance of the said order and direction
that the Appropriate Government made the above reference
to the CGIT, Mumbai.
16. After the reference was made directions came to be
issued for filing of the statement of claim by Union and
supported by the documents, if any. Accordingly, the
Union filed the statement of claim. It is stated that it
is a Trade Union representing the workmen covered by
dispute. It pointed out that the writ petition was filed
on behalf of 28 workmen out of which the workman at
Sr.No.13 expired in the year 2001 whereas another workman
was not allowed to resume duty on account of ill health.
It pointed out that the interim order passed by this Court
on 8th January, 1987 is operative and, therefore, the
claim be taken on record and adjudicated expeditiously.
After reiterating the contentions in the writ petition,
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the claim proceeds on the basis that the management
instead of following the fair and proper procedure has
introduced the system of engaging and employing the
workmen by resorting to such method as would unable the
Management not to adhere to and comply with the statutory
provision. In other words, the service conditions of the
workmen which have to be separately prescribed by the
Management are being given a go-bye and the workmen are
deprived of the benefits and rights which are made
available by various social and welfare legislations. It
was urged that the device of appointing the employees as
contract labourers needs to be probed by lifting the veil.
By this exercise it will be revealed that the concerned
persons are permanent employees of the Petroleum
Corporation. It was specifically urged in para 7 that the
contract between the management and so called contractors
are sham and bogus and mere camouflage to deprive the
persons concerned of the benefits available as permanent
workmen in the skilled category of Management of B.P.C.L.
In these circumstances, it was prayed that the Tribunal
should declare that the contracts are sham and bogus and
that the concerned workmen are permanent workmen of BPCL.
They be given all the benefits including allowances and
wages as permanent employees of BPCL. The statement of
claim is dated 30th May, 2002 and copy thereof was served
on B.P.C.L.
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17. In pursuance of the notice, written statement has
been filed before the Tribunal by BPCL. It raised several
preliminary objections. One of the objections raised was
that the employees are being employed by the contractors.
BPCL has entered into agreements with the concerned
contractors for providing contract labours. The persons
have been working under the control and supervision of the
contractors. There is no relationship of employer -
employee or master and servant between the Corporation and
contract labourers. Further, only one contractor is
mentioned in the memo of the writ petition and joined as
party respondent but there are other contractors and their
names were mentioned in para 1(a) of the written
statement. In such circumstances, it was prayed that the
reference be rejected. It should be rejected because the
concerned employees are working under the supervision and
control of the contractors who have powers to initiate
disciplinary action against them. Further, their wages
are paid by the contractors.
18. Elaborating this aspect, in the main paras, it was
urged by BPCL that it had entered into a comprehensive
contract with the contractor M/s Modern Farms and Gardens
to maintain the gardens and trees in the refinery at
Mahul, Mumbai. BPCL stated that the activities require
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specialised knowledge of gardening. It is a specific
branch which is aware of planting of trees, maintenance
and upkeep of plants by using the required quantity of
Manure, Fertilizer, pesticides etc. The specialised
knowledge regarding horticulture is possessed by the
contractors and they employ their men and utilise tools.
Therefore, by the tools and materials supplied by the
contractors the concerned persons are working at the
gardens. Initially the contractor was appointed for a
period commencing from 1st July, 1995 to 30th June, 1996.
The contract was extended from 1st July, 1996 to 31st
August, 1997. In the mean time, the writ petition was
filed by the Union. However, as per the applicable rules,
tenders have to be invited by BPCL for the contract work.
The BPCL invited fresh tenders and engaged the following
contractors:-
1. M/s Subhash Garden from 1.9.1997 to 31.8.1999
2. Heritage Gardens from 1.9.1999 to 31.8.2000
3. M/s Subhash Gardens from 1.9.2000 to 31.8.2001
4. M/s R.R.Enterprises from 1.9.2001 to 31.8.2002
19. These contractors have allowed the concerned workers
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to work on account of the interim order passed by this
Court. There is a genuine contract and all the
contractors have obtained necessary licences under the
Contract Labour (Regulation and Abolition) Act, 1970.
Thus, these contracts are not sham and bogus as alleged by
the Union but are genuine and made in accordance with law.
In these circumstances, it denied all the contentions in
the statement of claim to the contrary and urged that
there is no question of issuing any declaration that the
contracts were sham and bogus. Consequently, no relief
can be granted in favour of the workmen and reference be
rejected. This written statement was filed on 20th June,
2002.
20. The Record and Procedings reveal that the respondent
No.1 Union filed a rejoinder and at page 3 thereof they
urged that the concerned workmen were selected by the
Management. The contractors changed but the same set of
workmen have been attending the work. They have been
working under the direct supervision of the Management.
Thus, the services are fully controlled by the Management.
A reference was made to the terms of the contract. The
rejoinder is filed on 18th July, 2002. After the written
statement was filed, the Roznama maintained by the
Tribunal indicates that the matter was posted for filing
of the written statement by the contractor M/s Modern
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Farms and Gardens. Thereafter an application was made by
M/s R.R.Enterprises urging that it should be substituted
as a party in place of the old contractor. That
application was allowed on 1st August, 2002 and the newly
added party was directed to file the written statement.
Thereafter M/s R.R.Enterprises filed the appearance of its
Advocate and vakalatnama. Thereafter, the matter was
adjourned for framing of issues and they came to be framed
on 28th August, 2002.
21. Thereafter on 12th September, 2002 an application was
filed by the Union to implead all the contractors as
parties to the reference. The application (Exh.17) was
taken on file and thereafter opportunity was given to all
concerned to file their reply. After the replies were
filed the Tribunal passed the order on said application
allowing the same and permitting joinder of the
contractors, in addition to the Management.
22. Thereafter, newly added parties filed their
appearance and written statements. Additional issues were
framed after joinder of other parties on 5th February,
2003. It appears that some attempts were made for
settlement but after the same failed directions were
issued for filing of the affidavit in lieu of examination
in chief by the Union.
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23. Accordingly affidavit of respondent no.2 (Sunil
K.Dasade) was filed on behalf of himself and 23 other
employees by the first respondent Union. He reiterated
the contents of the Writ Petition and statement of claim.
He has stated that the contracts between the Management
and so called contractors are sham and bogus. They are
mere camouflage to deprive the concerned employees of the
benefits available to the persons’ working workmen in the
skilled category. Therefore, the workmen concerned who
are employed as gardeners must be granted wages and
consequential benefits attached to the post of permanent
workmen employed in skilled category by BPCL.
24. He was cross examined by the petitioner and in his
cross examination he was asked about his experience. He
was asked about his authority to depose on behalf of other
employees. He has admitted that from 1995 he is working
with the Modern Farm and Gardens, Mumbai. He worked till
1997 with the said contractor. He stated that the said
contractor was paying his salary during the above period.
They were giving provident fund facility and bonus also.
Thereafter, he joined Heritage Gardens and M/s
R.R.Enterprises. A suggestion was given to him that the
petitioner is engaged in refinery and processing of crude
oil and, therefore, does not employ anybody as Gardener,
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directly for gardening work. However, this suggestion is
denied. He was specifically given a suggestion that the
workmen concerned are employees of the contractors who
specialised in gardening work but that suggestion was
denied. Another suggestion was given to him that he is
not an employee of BPCL which was also denied.
25. Thereafter the contractor’s Advocate cross examined
the said Sunil. He admitted that he is a Member of the
Union called Mathadi Kamgar Sena. The cross examination
in para 10 reads thus:
"10. I am member of Mathadi Kamgar Sena. It is
true that said dispute is referred by Petroleum
Employees Union and not by Mathadi Kamgar Sena of
which I am a member. It is not true that these 23
employees were engaged by Contractors. Payment was
made by the contractor. Even bonus was paid by the
Contractor. ESIC and PF was being contributed by
the Contractor. It is true that I worked with
Subhash Garden from 1.9.97 to 31.8.1999 and
1.9.2000 to 31.8.2001 and with M/s Heritage Garden
from 1.9.1999 to 31.8.2000. It is true that I
worked with R.R.Enterprises from 1.9.2001 till
today. I am working with R.R.Enterprises even till
today on the basis of High Court order. Not true
to say that contractor was supervising our work.
Mr.D.G.Bansal the Dy. Manager of the Company was
supervising our work. One Mr.Rohidas Raut who is
one of the workmen was actually supervising our
work and the above fellow Mr.Bansal was asking work
which was to be done on a particular day. Not true
to say that our was work was being supervised by
the Contractor."
26. This was the oral evidence on behalf of the Union and
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workmen. As far as BPCL is concerned, it examined the
Chief Manager (Employees Relations) Sujata N.Chogale.
This witness in her examination in chief reiterated the
contents of the written statement and in para 5 and 6
stated thus:
"5. I say that the contract labour involved in the
above reference are doing the job of gardening
under the supervision of Contractors engaged by the
Corporation from time to time. The details of the
contractors engaged by the Corporation after
inviting tenders and their period of engagement is
as under:
Sr.No. Name of the Contractor Period of the
contract.
1. Modern Farms & Gardens 1.7.1995 to 30.6.1996
2. M/s Subhash Gardens 1.9.1997 to 31.8.1999.
3. Heritage Gardens 1.9.1999 to 31.8.2000
4. M/s Subhash Gardens 1.9.2000 to 31.8.2001
5. M/s R.R.Enterprise 1.9.2000 to 31.12.2005
6. M/s Subhash Gardens Since 01.01.2006
6. I say that as per the terms of the contract,
the Contractors were required to maintain the
garden and trees at the Refinery of the Corporation
situated at Mahul. The contract also involve
maintenance of garden, planting of trees, plants,
etc. as and when required and doing every thing as
required for the purpose of maintenance of the
garden. The said activity requires specialised
knowledge in as much as gardening requires use of
various kind of manures, fertilizers, pesticides,
fungicides, landscaping and such other specialised
knowledge as regards horticulture. I say that the
contract also requires the tools, tankers and
plants, such as lawn movers, rollers, sickles,
knives, scissors etc. for horticultural jobs be
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provided by the contractor. I say that it is also
provided in the contract that Contractors shall be
required to maintain minimum stock of materials
required for horticultural works, such as hose
pipes, movers, rollers, seeds, fertilizers,
pesticides, fungicides etc. The contractors are
also required to arrange for all flexible pipelines
required for watering and also arrange to protect
the same at road crossing. The contractors also
are required to arrange for empty tankers for
carrying water to places where water for gardening
may not be available."
27. It is stated by her that all the 25 contract labours
involved in the reference were recruited by the
Contractors. They were under the full control and
supervision of the contractors or their supervisors. The
contractors exercised full control and supervision over
the said contract labourers. She further states that
maintenance of gardens at its Refinery by BPCL is not a
process, operation or other work which is incidental or
necessary for the industry. She states that there are no
regular workmen who are engaged in performing the garden
work at the refinery. She states that the garden is
maintained for having some greenery around the place of
work. There is no legal obligation to maintain the garden
and to look after the plant and shrubs, which are grown in
the refinery. She reiterates that maintenance of garden
is not the activity which is connected with the processing
or refining of crude oil at the factory. In para 9 of her
deposition she has stated that the contractors; engaged
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for the work of gardening have obtained licence under the
Contract Labour (Regulation and Abolition) Act, 1971,
hereinafter referred to as "Contract Labour Act" She
states that all contractors engaged by BPCL were and are
paying the wages of the employees. It is the contractors
who are complying with the provisions of ESI Act,
Provident Fund Act, Minimum Wages Act and Payment of Bonus
Act. Thus, all statutory obligations are complied with by
the contractors. She states that the gardeners are
subject to the disciplinary action by the contractors.
She states that the Corporation is in no manner exercising
any control or supervision as far as the work carried out
by the contract labour. Therefore, there is no
Master-servant relationship as between BPCL and contract
labour. In para 10 of her deposition in chief she states
that the contractors appointed by BPCL are genuine. They
were all appointed after inviting tenders and fulfilling
other requirements applicable to Public Sector Undertaking
(PSU). She stated that the contractors are specialised
persons engaged in providing specialised services for
gardening. The contracts entered into are neither sham
nor bogus. In para 11 she has stated that BPCL has its
own recruitment agency for the purpose of recruitment of
regular employees and none of the 25 employees are fit nor
do they qualify for appointment in regular employment of
BPCL. She has stated that there are no vacancies or posts
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created for work of gardening in the refinery. She denied
that the work of gardening in the refinery is of permanent
or perennial nature. For these reasons she stated that
the reference be rejected. Her deposition in chief is
dated 17th October, 2006. Both sides filed number of
documents along with respective depositions which have
been taken on record.
28. As far as cross examination of the Management witness
is concerned, the same was only behalf of the Union. In
her cross examination she states thus:
"Cross examination by Advocate Mr.B.J.Sawant, Advocate for
workmen.
15. I am working for 23 years with 1st party as an
officer and as Chief Manager from July, 2005. The
concerned workmen are the employees of the Contractors and
as a result of Court order we continued them since 9th
October, 2001. Not true to say that, these workers are
working with 1st Party for more than 20 years. It is
correct to say that 1st party has to maintain environment
performance at Refinery which is mandatory under said Act.
No true to say that, for running 1st Party Corporation the
work of maintaining park is part and parcel of regular
work of the Corporation.
16. Refinery started 50 years ago and in the name of
Bharat Petroleum since 1970. Not true to say that,
gardening work was there at the time of the inception of
the Corporation. Not true to say that, gardening work is
checked by the officers of the 1st party regularly as part
of their duty.
Q: The workers who are required for gardening must have
skill of it?
A: Not is case of all.
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It is true that there were no Contractors prior to 1995
when the gardens were started. Not true to say that these
contractors are working with BPCL in Gardening Sector. It
is true that same contractors are not continued for next
period as shown in para 5 of my affidavit.
Q: What are the norms for appointment of contractors?
A: Contractors are appointed by calling tenders.
Not true to say that, I am deposing falsely that, we
invite tenders while appointing contractors. Not true to
say that, the contractors shown in para 5 of the affidavit
are bogus one. It is true that, there is no name of the
Contractor though there is name of the firm. Not true to
say that, the Contractors mentioned in the affidavit, of
which documents are produced by me, some of them are
related to the officers of the 1st party. Not true to say
that, some of the workers are directly working as
Gardeners who are employees of BPCL and that they are
getting more than Rs.16000/- per month. These gardeners
involved in the reference may be getting around Rs.4000/-
per month. Not true to say that, the employees involved
in the reference were selected by the Corporation
Officers. Not true to say that, some of them are working
for more than 30 years with BPCL. Not true to say that,
these contractors are bogus and sham.
No re-examination."
29. It appears that the contractors also entered the
witness box and on behalf of one M/s Subhash Gardens, Raju
R.Subhhaya has deposed. He stated that he was awarded
contract by BPCL from 1st September, 1997 till 31st
August, 1999 and again from 1st September, 2000 till 31st
August, 2001 for maintaining gardens, planting of trees in
Mahul refinery of BPCL. He deposed about the terms of
contract and stated that Subhash Gardens had taken licence
under Contract Labour Act. Subash Gardens is again
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appointed as contractor with effect from 1st January,
2006. He admitted that the contractor engaged the same
contract labours which were employed by previous
contractor. The contract which is entered into last in
point of time was subsisting on 15th January, 2007. He
stated that the workmen are of M/s Subhash Gardeners and
contract is genuine and as per law. He stated that he as
a proprietor of Subash Gardens visits the refinery and
supervise the contract labour work carried by him. He
stated that he disbursed the wages to the contract labour
involved in reference each month. He states that each of
the contract labour is paid wages in consonance with the
Minimum Wages Act. Lowest daily wage payable to the
contract labour is Rs.151/- per day. He stated that M/s
Subhash Gardens deducts provident fund and ESI
contribution each month from the wages of the contract
labour engaged by it and deposits the same before the
specified authorities. Even the leave is granted and
sanctioned by him. The day today attendance is marked in
the muster roll maintained by M/s Subhash Gardens.
Thus,the BPCL or its officer has no right to give any
directions or orders to the contract labours at site of
Subash Gardens. Even the disciplinary action is taken by
M/s Subhash Gardens. Thus, he denied that the contract is
sham and bogus.
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30. In cross examination by Union, this witness admitted
that the workers involved in reference were working with
Subhash Gardens for the last 10-12 years. He denied that
they are working only with BPCL for all these days. He
admitted that prior to 19th January, 1997 Subhash Gardens
were not concerned with BPCL. He states that as soon as
he got the contract in his favour he engaged the workers
engaged by BPCL. He stated that he used to maintain the
muster roll. He has admitted that nobody has recognised
M/s Subhash Gardens as specialised in gardening. He
admits that he has not produced any documents regarding
disciplinary action taken against the workers involved in
reference. To a specific question that the proprietor is
not monitoring and supervising the workers involved in
reference, answer is that supervisor supervises the work.
The supervisor’s names given by him are Mr.Rohidas and
Mr.Ashok Patil. He denied specifically that the
supervisor by name Supe and Sadaphule supervise the work
of workers involved in reference while working with BPCL.
It appears that the cross examination conducted on 22nd
December, 2006 was adjourned at the request of the parties
but later on there does not appear to be any further cross
examination of this witness.
31. Another contractor M/s R.R.Enterprises deposed
through its proprietor and reiterated the statements in
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his examination in chief. Even otherwise, the contents of
the affidavit in lieu of examination in chief demonstrate
that this contract is from 1st September, 2001 till 31st
December, 2005 on year to year basis.
32. In the cross examination this contractor admitted
that the workers were appointed with BPCL even prior to
the contract in favour of M/s R.R.Enterprises. He admits
that another contractor replaced the earlier contractor.
Same workers were working with them. He deposes that
Subhash Gardens was the contractor before him and
presently also Subhash Gardens is the contractor where the
workers involved in reference are working.
33. This is oral and documentary evidence before the
Tribunal. The Tribunal after considering this material
and arguments of both sides held that the employer
employee relationship exists between the petitioner BPCL
and the concerned workmen. It held that the contract
between BPCL and contractors are sham and bogus. They are
camouflage to deprive the workers from the benefits
available to the permanent workers and, therefore,
answered issue nos.3 to 5 in affirmative.
34. Before me there are no arguments canvassed with
regard to issue nos. 1 and 2. The matter must,
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therefore, proceed on the basis that the workers covered
by reference are "workmen" within the meaning of section
2(s) of Industrial Disputes Act, 1947. Further the
dispute referred for adjudication is an "Industrial
Dispute."
35. The arguments before me have been restricted to Issue
nos. 3 to 5. As far as these issues are concerned, the
learned Presiding Officer considering the arguments, in
paras 16 and 18 of the impugned award concludes that the
workers are working for 5 to 10 years with BPCL but
through different contractors and that fact is admitted by
Raju Subhaya and Sujata Chogale. He relies upon the
admission in the deposition of Raju Subhaya and more
particularly to the effect that there is no proof to show
that any disciplinary action was taken by the contractor.
Thus, the contractor may change but the workers are the
same and they have been so working for last 10-15 years is
admitted fact according to the learned Presiding Officer
and, therefore, it is held in para 19 by the learned
Presiding Officer that there are no details with regard to
the contractors. The learned Presiding Officer has held
that there is nothing on record to indicate that the
tenders were accepted or rejected. There is nothing to
show that the tenders forwarded by the contractors were
accepted and what was the criteria which was applied while
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accepting the tenders or rejecting them. There are no
details as to how many bids/tenders were received for the
contract work. The learned Presiding Officer has held
that there is no explanation as to why same workers are
working in the gardens of B.P.C.L for years together. If
there are different contractors they must have their
different teams and same team cannot work for different
contractors. Thus, according to the learned Presiding
Officer there was no particular contract and if suppose
there was any such contract, then, there was no individual
coming forward to represent either M/s Subhash Garden or
M/s R.R.Enterprises. For all these reasons according to
him the contracts are bogus. They are created by BPCL
with an intention to deprive the workers of their legal
right. Thereafter, in para 21 the learned Presiding
officer considers the documents produced by BPCL. It is
observed by the learned Presiding Officer that the
documents which are filed in the conciliation proceedings
and more particularly the terms and conditions of the
contract reveal that the workers involved in reference are
working for BPCL. The maintenance of garden is essential
for all activities of BPCL. The garden is maintained on
the lands of the BPCL. Thus, when there is a garden on
the land of BPCL and maintained by it with the group of
workers, it cannot be considered as separate part, is the
conclusion. Various functions and distribution thereof in
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various organisations including Bombay Municipal
Corporation are discussed by the learned Presiding Officer
and ultimately it is held by him that the workers of the
present reference working with the alleged contractors are
really working for B.P.C.L. and i.e. how the issues
referred above are answered by him in the affirmative.
36. It is this conclusion which is assailed before me in
the present petition.
37. Mr.Cama, learned Senior Counsel appearing for the
petitioner submits that the impugned award is ex facie
erroneous and perverse. He submits that the learned
Presiding Officer has not applied his mind to the material
before him. He has failed to consider the oral and
documentary evidence on record in its entirety. He
submits that the Presiding Officer failed to notice that
burden was totally on the first respondent Union and it
has miserably failed to discharge it. There is no case
made out for permanency. There is absolutely nothing to
conclude that the contracts are sham and bogus. He
submits that the Presiding Officer ought to have taken
into consideration the admissions in the deposition of the
Union’s witness and documents produced by the parties.
Once the judgment ignores or fails to consider and notice
the evidence and material on record, then, it is patently
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unsustainable and deserves to be quashed and set aside.
38. Mr.Cama has taken me through the pleadings and
evidence in support of the above submissions. He submits
that the Presiding Officer has misdirected himself totally
while deciding the reference. The issues framed by him
would show that the burden was on the Union completely.
The Union did not lead any evidence to prove that all 23
workmen were direct employees of BPCL. Mr.Cama criticises
the judgment of the Presiding Officer as, in his
submission, Presiding Officer relies upon the testimony of
Sunil Dasade. Mr.Cama submits that there is nothing on
record to demonstrate that this workman was deposing on
behalf of all the workmen/members of Union. He submits
that the facts which are peculiar to every workman
including the nature of work performed must be stated by
the individual workman. Unless it is proved that the case
of all of them is common and each one of them is
identically placed, the deposition of single workman
cannot be relied upon. That apart, he submits that the
deposition of Sunil Dasade should be read as a whole. So
read, it is apparent that the reference was made at the
instance of "Petroleum Employees Union". However, in the
cross-examination Sunil Dasade has admitted that he is a
member of Mathadi Kamgar Sena. How Mathadi Kamgar Sena
and Petroleum Employees Union became one and the same
-31-
entity is not clear at all. It is not the case of the
workmen that each of them has left the Petroleum Union and
have joined or formed/organised themselves into Mathadi
Kamgar sena. The connection between Mathadi Kamgar Sen
and Petroleum Union has not been established. In such
circumstances, his testimony is of no assistance. Apart
from this deposition there is absolutely no material on
record to show that the contracts are sham and bogus or
that the employees concerned are regular employees of
BPCL. Once the workman has admitted that payment was made
by the contractor and even the benefits such as bonus,
provident fund are paid by him, then, the employees are
engaged by the contractors and that alone can be the
conclusion. Even with regard to supervision and control,
which is another test, which has been applied through out,
it is clear that BPCL has not been supervising the work of
the employees concerned. It is not their case that BPCL
has any Horticulture or Gardening wing or Department.
That is a specialised work and BPCL has engaged anybody to
do the same. It has been awarding contracts right from
the time of inception of garden and, therefore, evidence
of BPCL should have been relied upon in this behalf.
Mr.Cama submits that there is no admission on the part of
the witness of BPCL which could lead to a finding of the
nature arrived at by the Presiding Officer. In fact,
there is no cross examination of the witness examined by
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BPCL. The contracts have been produced on record and
their clauses are clear. In such circumstances, the
conclusion arrived at his wholly vitiated and, therefore,
the award must be quashed and set aside.
39. In support of his contentions, Mr.Cama has relied
upon the following decisions:-
(1) (1994) 5 Supreme Court Cases 304 (R.K.Panda and others
Vs.Steel Authority of India and others)
(2) 2005 II CLR 457 (Haldia Refinery Canteen Employees
Union and others Vs. Indian Oil Corporation Ltd. and
others.
(3) 2007 II CLR 305 (Majid Oomerbhoy Vs.Workmen
represented by Bhartiya Kamgar Karmachari Mahasangh and
others)
(4) (2004) 3 Supreme Court cases 514 (Workmen of Nilgiri
Coop.Mkt.Society Ltd. Vs. State of T.N.and others)
(5) (2006) 4 Supreme Court Cases 1 (Secretary, State of
Karnataka and others Vs. Umadevi (3) and others)
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(6) 2007 II CLR 514 (U.P.Power Corporation Ltd. and
anr.Vs.Bijli Mazdoor Sangh and others)
(7) (2006) 2 Supreme Court Cases 482 (Union Public Service
Commission Vs.Girish Jayantilal Vaghela and others)
(8) 2007 II CLR 139 (Gangadhar Pillai Vs,.M/s Siemens
Ltd.)
(9) (2001) 7 Supreme Court Cases 346 (Mahatma Phule
Agricultural University and others Vs.Masik Zilla Sheth
Kamgar Union and others)
(10) 2001 III CLR 349 (Steel Authority of India Ltd. and
others Vs.National Union Water Front Workers and ors
etc.etc.)
(11) 2008 I CLR 864 (Hindustan Petroleum Corpn.Ltd.
Vs.Ashok Ranghba Ambre)
40. On the other hand, Mr.Bukhari, learned Counsel
appearing for respondent nos.1 and 2 has contended that
the refinery at Mahul had been owned by the predecessor in
title of BPCL. He contends that Burmah Shell was the
concerned company and after the petroleum business was
taken over by the Central Government, the said refinery
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also came to be taken over. Thereafter the Petroleum
Companies/Corporations were established by the Govt. of
India and the refinery at Mahul, Chembur, Mumbai was
handed over to BPCL. He submits that under Environmental
Protection Act and even prior thereto there was a
requirement of maintenance of greenery and garden within
the refinery premises. This is essential and statutory
requirement. There is no dispute about the fact that such
a greenery and garden had to be maintained so as to curb
pollution and protect environment. He submits that if
this minimal care is not taken, then, refinery posses the
health risk and hazard. In such circumstances, it is
futile to urge that the garden was not being maintained
prior to 1995. Merely because one of the contractors has
stepped in allegedly from 1995 does not mean that the
garden has come into existence in 1995. He submits that
such a case was not placed before CGIT at any time by
BPCL. Therefore, this Court should not accept such an
argument for the first time in this writ petition.
41. Mr.Bukhari has invited my attention to paragraphs 4,
7 and 10 of the affidavit in reply to this writ petition.
He has contended that the petitioners are arguing this
petition as if it is an Appeal. He submits that this
Court cannot reappreciate and reappraise the factual
material in writ jurisdiction. This is not a further
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appeal so as to permit such a course of action.
Therefore, the finding of facts are binding on this Court.
Unless, they are demonstrated to be totally perverse, it
is not possible to interfere in writ jurisdiction. He
submits that the witness who has been examined by the
Union has deposed on behalf of all the workmen who are
members of the concerned Union. There is no substance in
the grievance that the deponent had no connection with the
Petroleum Union or that the workmen are members of the
Petroleum Union and, therefore, Mathadi Kamgar Sena cannot
be said to be representing them at all. He submits that
such an argument is an desperate attempt to avoid the
consequences of the Award. The attempt is to misguide and
mislead this Court. He submits that whatever may be the
label or name of the Union, ultimately the reference was
at the instance of the employees. 24 employees concerned
have spoken in one voice and in one tone. Their case is
identical and, therefore, representative version of Sunil
Dasade has been rightly accepted by CGIT. He submits that
the case before CGIT was plain and simple. The workmen
concerned have been asserting a case of regular and
permanent employment with BPCL on the basis that they had
put in continuous service of nearly 8-10 years and more.
They have been doing the work of permanent and perennial
nature. It is their case that the skilled job of
attending the entire gardening work and horticultural
-36-
maintenance is done by the concerned workmen. They are
working at the refinery premises. He submits that it
cannot be forgotten that the BPCL made a statement before
this Court, when this Court admitted the earlier writ
petition and passed an Interim order in favour of the
workmen. Once BPCL made a statement that it will not
disturb the employment of the concerned workmen, then, it
is obvious that these workmen have been working for BPCL.
The most important factor of the very workmen continuing
through out is a strong indicator that the contracts are
sham and bogus. They are mere paper arrangement. They
were never intended to be acted upon. These are the state
of affairs emerging from the record produced by BPCL
before CGIT. If these documents speak volume of the
conduct of BPCL, then, the conclusion is inevitable that
the employees are of BPCL and none else.
42. Mr.Bukhari strenuously contended that the petitioner
BPCL has not produced the details of the contractors which
were engaged from 1st September, 2002 to 31st December,
2005. The only conclusion that can be drawn from this is
that there was no contractor. He submits that only copies
of the contracts have been produced but no proof is
tendered with regard to the contents. There is no proof
which has been tendered to support the statement in the
deposition in chief of BPCL’s witness. On the other hand,
-37-
the witness during the cross examination has admitted that
the garden was existing even prior to 1995. He has
invited my attention to para 5 of the examination in chief
of the witness of BPCL. He submits that from 1st July
1996 to 31st August, 1997 there is no contractor. In such
circumstances, the details of the contractors are not at
all enough to conclude that the employees are engaged by
the contractors. Mr.Bukhari’s submission is that because
some statements are made in the cross examination of the
Union witness that by itself is not proof of engagement of
the contractor. Some sporadical or intermittent
engagement is of no assistance. He has also placed strong
reliance upon the cross examination of the BPCL’s witness
and more particularly paras 15 and 16 thereof. In these
circumstances, there is enough suspicion and doubt and,
therefore, the conclusion drawn that the contracts are not
genuine but mere paper arrangement. They were never acted
upon. This conclusion cannot be said to be vitiated by
any error apparent nor can be termed as perverse so as to
call for intervention under Article 226 of the
Constitution of India. For these reasons and on account
of clear admission by the contractors who were before CGIT
that the writ petition deserves to be dismissed.
43. Mr.Bukhari has relied upon the following decisions in
support of his contentions.
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(1) 1978 II LLJ 397 (Hussainbhai Calicut Vs.Alath Factory
Thozhilali Union, Calicut and others)
(2) 1999 I CLR 959 (Secretary, Haryana State Electricity
Board Vs. Suresh and others)
(3) 1999 I CLR 967 (Gansons Engineers Pvt.Ltd. Vs.
Shriram Y.Chhatre and another)
(4) 1999 II LLJ 232 (The Workmen of the Food Corporation
of India and M/s Food Corporation of India)
(5) 1990 LAB. I.C. (1968) (Food Corporation of India
Workers’ Union Vs. Food Corporation of India)
(6) 1990 LAB I.C.1977 ( Maisuria Mahendra Bhagwandas and
others Vs. The State of Gujarat and others).
(7) 1995 I CLR 967 ( Gujarat Electricity Board Vs. Hind
Mazdoor Sabha and others).
(8) 1995 I CLR 1002 (Pushpa Vishnu Kumar Gurtu (Dr.)(Mrs)
Vs. State of Maharashtra and others)
(9) 1999 II LLJ Supreme Court 232 (Indian Petrochemicals
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Corporation Ltd. and another Vs. Shramik Sena and
others)
(10) 1994 II CLR 537 (Contract Laghu Udyog Kamgar Union
Vs. K.D.Desai and others)
(11) 2003 III CLR 188 (Bharat Heavy Electrical Ltd. Vs.
State of U.P. and others)
(12) 2008 I CLR 1023 (Hindalco Industries Ltd.
Vs.Association of Engineering Workers)
(13) 2001 (I) LLJ 1127 (ICM Engineering Workers Union and
others Vs. Union of India and others)
44. Mr.Shetty who has appeared on behalf of the
contractors, apart from supporting the petitioner has
submitted that the law is clear. Burden is on the workmen
and they have not discharged the same. Mr.Shetty has
invited my attention to the fact that the work that has
been carried on by the contractor for all these years has
been duly certified and the payments have been received
with regard to the same. These arrangements are in force
in several organisations and PSUs. At no stage, has any
doubt been raised with regard to genuineness of such
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arrangement. It is for the first time that such pleas are
raised and they are wholly unsubstantiated and baseless.
He has invited my attention to the deposition of the
contractors. The contractors on oath have said that they
have been responsible for discharge of all statutory
obligations. They have paid the wages and benefits, they
have supervised the work, they have sanctioned the leave
and taken disciplinary action. Thus, all tests that are
required to be satisfied for determination of the issue in
question have been satisfied and yet an erroneous
conclusion has been arrived at by the Presiding Officer,
CGIT. In these circumstances, the impugned order is ex
facie bad in law and deserves to be quashed and set aside.
Therefore, he prays that the petition be allowed.
45. For properly appreciating the rival contentions, it
would be necessary to note the terms of reference and
order of this Court preceding them. The terms of
reference arose on account of the dispute raised by the
concerned employees which has already been set out above.
The terms of reference have been framed by this Court
itself. The Appropriate Government has referred for
adjudication the demand with regard to the contract
between the BPCL and contractors. Whether the same is
sham and bogus and is camouflage to deprive the concerned
employees from the benefit available to the permanent
-41-
workmen of BPCL and whether such workmen are entitled to
be declared as permanent employees or not are the terms of
the Reference. These points/issues arose for adjudication
in the light of the disputes between the Management and
the Union. These disputes were highlighted before this
Court and the Central Government.
46. Some basic and undisputed facts need to be noted in
this regard. The respondent No.1 Union was representing
the 23 workers. The Statement of Claim was filed on their
behalf by the Union. Thereafter, the workmen joined
Hindustan Mathadi Transport and General Kamgar Sena.
However, the workmen filed affidavit Exhibit 37 of
S.K.Dasade adopting the Statement of Claim filed by
earlier Union. They prayed that same advocate be
continued to represent them. A common application is
filed. One workman’s version and deposition was adopted
by all. Thus, Sunil Dasade represented all of them (see
para 4 of Exhibit 37). His deposition was therefore
representative in nature and taken an record so also
treated as such. BPCL never raised any objection to all
these steps. Now, the hyper-technical objection of Shri
Cama to the contrary cannot be accepted. The Union had
all throughout authorised Shri Dasade to affirm pleadings
and depose on behalf of all workers and that is clear from
Exhibit 37. It is too late now to urge that at its
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Refinery BPCL is not maintaining any lawn and garden.
None has proceeded on the basis that the garden came into
existence only in 1995. On the other hand, the
Corporation’s written statement also proceeds on the basis
that the garden was in existence but in 1995 a
comprehensive contract was executed with M/s Modern Farm
and Gardens, Mumbai for maintaining the garden and trees
in the refinery of the Corporation situated at Mahul,
Mumbai. The contractor, according to BPCL, was engaged
for maintenance of garden, plantation of trees itself.
This presupposes that the garden was in existence. The
Horticultural jobs were being carried on even prior to
1995 is the admitted position. Merely because some
suggestion was given to the witness of the Corporation and
answer thereto is that the garden came into existence in
1995 that by itself is not enough to discard and brush
aside the other material and written statement of the
Corporation itself. From the said material it is obvious
that the refinery is there since 1970 and it can safely
be, therefore, concluded that the garden was in existence
atleast therefrom. Therefore, it is futile to urge now
for the first time that there was no garden nor any
horticultural activities prior to 1995.
47. Once this aspect is clarified, then, it will be
appropriate to consider the case of the Union. In the
-43-
writ petition as well as in the statement of claim, a
categorical averment has been made by the Union that the
concerned employees were working in the garden maintained
by BPCL and their tenure is set out as against their names
in the list which is annexed to the statement of claim.
Such a list was also annexed to the memo of writ petition
filed in this Court. The writ petition averments are that
the BPCL requires number of permanent workers in its
refinery for the purpose of maintaining garden and trees
in their campus. The garden work is of permanent and
perennial nature. The employees whose names are mentioned
in the annexure to the writ petition and statement of
claim have been employed for years together. Their length
of service has been set out and it is contended that the
entry permits/passes have been issued to them by the BPCL.
48. It is undisputed before me that the work is of
permanent and perennial nature. No argument is canvassed
even before the Court below in so far as the nature of the
work is concerned. From a perusal of the statement of
claim, written statement and issues framed, it is apparent
that the work of maintenance of garden and upkeep thereof
is incidental and ancillary to the main work of refinery.
At the refinery crude oil is refined and made available
for sale. Oil products being refined at the refinery is
the main activity and for effective and smooth functioning
-44-
of the refinery so also not to have any health hazard,
that the garden has been maintained in the refinery
campus. It is for maintaining the ecological and
environmental balance. BPCL does not dispute
applicability of the provisions of Environment Protection
Act, 1986. It is not disputing its obligation thereunder.
No PSU much less BPCL can contend that it is not obliged
to protect and preserve trees, open spaces and gardens or
lawns. Protection of ecology and environment is the duty
of all those involved in such operations. The city of
Mumbai has grown tremendously since nationalisation of
petroleum business. The refinery and the operations
therein are continuing subject to adherence to the norms
for curbing pollution and health hazards.
49. The only dispute between the parties is whether the
above work has been carried on all through out or atleast
after 1995 by the concerned employees as Direct employees
of BPCL or as contract labourers.
50. In this behalf the pleading in the writ petition is
that the concerned workers are engaged for gardening work
for years together. The length of service of each of the
workman is also specified. Further, it is the contention
that the entry passes have been issued by the management
of BPCL to the workers in the refinery. The work is of
-45-
perennial and permanent nature. When the writ petition
was filed there was contractor who was employed and the
name of the contractor was Modern Farms and Gardens. This
contractor has been referred to in the written statement
of BPCL and it is stated even in the deposition of the
witness of BPCL that the Modern Farms and Gardens were the
contractors from 1st July, 1995 to 30th June, 1996. Thus,
on the date of filing of the writ petition, this
contractor was engaged. Thereafter, BPCL awarded several
contracts but M/s Subhash Gardens was awarded the contract
on 3 occasions. M/s Heritage Gardens and M/s
R.R.Enterprises are the other contractors. The
workmen/Union reiterated the contents of the writ
petition. They had very clearly stated in their statement
of claim that BPCL has not been following a fair personnel
policy. They have introduced certain practices and are
showing that the workmen concerned are employed by the
contractor only with a view to deprive these workmen of
the benefits of permanency. The pleading is thus clear.
It is specifically stated that there is a direct
relationship of employer and employee between BPCL and
concerned workmen. However, the Tribunal will have to
pierce the veil and thereafter truth will be out. It was
urged by the workmen that the contracts are sham and bogus
so also mere camouflage to deprive them of the benefits
available to permanent workmen in the skilled category.
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51. In the written statement, the specific case of BPCL
is that the contract is not sham and bogus but a genuine
contract. It has been urged that the contracts entered
into are genuine and all the contractors have taken over
the liabilities under various statutes and are complying
with the same. It is stated that the contractor ensures
that the workmen engaged by them are paid wages in
accordance with the Minimum Wages Act. The contractor
complied with the Provident Fund Act, ESI Act, Payment of
Bonus Act etc. It is specifically stated that there is no
employer employee relationship between the BPCL and the
concerned workmen. It is the contractor who is
supervising their work and taking necessary action. It is
rather curious that the BPCL in its written statement has
stated that the concerned workmen are employed by the
contractor with whom the Corporation had entered into
agreements for providing contract labourers but witness
examined by BPCL has in her deposition stated that all the
25 workmen were recruited by the contractor.
52. Now, the contractors were also impleaded by the
workmen/Union by making application and two of the
contractors who were impleaded and appearing before the
CGIT examined themselves. M/s Subhash Gardens had filed
an affidavit of Mr.Raju Subhaiya. This contractor in para
-47-
2 of his deposition states that he has initially engaged
about 25 contract labours and they were under the control
and supervision of the said contractor. For that purpose
the supervisors are also employed. The wages are paid by
the contractor and muster roll is also maintained by the
contractor. Their services are also liable to be
terminated so also the contractor can take disciplinary
action. In para 3 of the deposition in chief the
contractor states that when he was awarded the contract
with effect from 1st January, 2006 M/s Subhash Gardens
engaged the same contract labours which were engaged by
previous contractor. The previous contractor was M/s
R.R.Enterprises. Now, it is not the contractor’s case
that they have recruited the concerned workmen. They are
only speaking of their engagement. In para 6 of the
deposition in chief the witness states that contractors
have been paying wages per month and they are also
deducting provident fund and ESI contribution. They are
sanctioning the leave to the employees. Day today
attendance is marked in the muster roll of M/s Subhash
Gardens.
53. In the cross examination it has been denied that the
workers are working only with BPCL. The statement is made
that the workers are working with M/s Subhash Gardens for
last 10-12 years. Subhash Gardens were engaged from 1997
-48-
to 1999 and from 2000 to 2001 and thereafter in 2006.
Therefore, there is no question of Subhash Gardens
engaging these workers for 10 to 12 years. That is clear
from further admission in para 11 of the deposition that
prior to 19th January, 1997 Subhash Gardens were not
concerned with BPCL. Further, as soon as they got work
with BPCL they had engaged the workers who were engaged at
that time with BPCL. In my view, these statements are
clear and the contractors M/s Subhash Gardens could not
substantiate any of the statements made in their written
statement. Merely because, the cross examination is not
pursued further, with regard to production of muster roll,
material pertaining to disciplinary action and wage
register so also ESI and provident fund contribution, does
not mean that the contractor’s version is proved. If
there was any doubt, then, a specific question was put to
this contractor with regard to monitoring and supervising
the work of the concerned employees and answer is
supervisor of the contractor supervises the work. The
supervisors’ names are given as Mr.Rohidas and Mr.Ashok
Patil. These persons are part of the list of 25 workers.
Mr.Rohidas is at Sr.No.2 and Mr.Ashok Patil is at
Sr.No.16.
54. In the examination-in-chief, the witness states that
he has been supervising the work whereas in the cross it
-49-
is stated that the work was supervised by supervisors.
The names mentioned are of the BPCL employees. Thus, they
have been supervising the work. It is not disputed that
Mr.D.G.Bansal is an employee and officer of BPCL. It is
stated by the workmen that he was supervising their work.
Now, this is a clear contradiction. As against this, the
case of the petitioner is that names of these workers are
given by M/s Modern Farms and Gardens. This is clear from
perusal of Exh.A to the writ petition, copy of which was
handed over to me by both sides. The specific suggestion
that supervisors of the company (BPCL) were supervising
the work of the concerned workers has been denied. In my
view, the testimony of the witness of M/s Subhash Gardens
read as a whole reveals that the said contractor has been
unable to substantiate the case of the workers being
employed and engaged by it.
55. As far as M/s R.R.Enterprises are concerned, their
proprietor has filed an affidavit supporting the stand in
the written statement. He more or less adopts the
testimony of M/s Subhash Gardens. That is clear from
reading of paras 3 to 8 of the deposition. In the cross
examination of M/s R.R.Enterprises it is apparent that the
contractor is engaged only from 1.9.2001 to 31.12.2005.
He states that the workers concerned were working with him
only during 2001 to 2005 and they were working with BPCL
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even prior to the contractors with M/s R.R.Enterprises.
He admits that when another contractor steps into the
place of earlier contractor these very workers are working
with them. He names the earlier contractor and confirms
that even the present contractor is engaging these workers
(see para 11 of the deposition of the proprietor of M/s
R.R.Enterprises). As far as M/s Heritage Gardens are
concerned, both sides state that M/s Heritage Gardens have
not filed any affidavit to substantiate the pleas. In
fact, there is written statement filed by M/s Heritage
Gardens but nobody has deposed on their behalf.
56. It is in this backdrop that the cross examination of
BPCL’s witness will have to be seen. The witness states
that she has been working for 23 years with BPCL. She
states that the concerned workers are employees of the
contractor but have been continued as a result of the
Court’s order. She states that they have been continued
from 9th October, 2001. This is obviously an incorrect
statement. The witness ought to have been aware of the
interim order dated 08th January, 1997 in Writ Petition
No.800 of 1996. If she is working for 23 years in BPCL
and deposing before the Court, then, this statement before
the CGIT could not have been made by her. She denies the
suggestion that the workers are working with the first
party (BPCL) for more than 20 years. However, she admits
-51-
that BPCL has to maintain the Environment performance at
the refinery and that requirement is mandatory. However,
it is denied that the work of maintaining the park is part
and parcel or regular work of Corporation. She admits
that the refinery was established 50 years ago and is in
the name of Bharat Petroleum since 1970. She denies that
the gardening work was there at the time of inception of
the Corporation. She denies the suggestion that the
gardening work is checked by the officers of the B.P.C.L.
as part of their duty. She denies the suggestion that all
workers required for the gardening work need to be
skilled. However, she admits that there was no contractor
prior to 1995.
57. The argument that the gardens were started in 1995
and, therefore, there was no contractor earlier is
misconceived and untenable. That cannot be accepted if
the entire deposition of the witness of BPCL is perused.
It is not the case of BPCL that there was no garden in the
refinery prior to 1995. The witness was not asked the
question with regard to existence of the garden but
engagement of the contractor. Therefore, this admission
of the witness of BPCL is crucial. She admits that the
appointment of the contractor is by calling the tender.
The answer to the suggestion with regard to inviting
tenders while appointing the contractors is false. She
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admits that there is no name of the contractors in the
contracts though there is a name of the firm. She denies
the suggestion that the contractors engaged are none other
than the relatives of the officers of BPCL. She denies
that regular employees who are working as gardeners are
getting more than Rs.16,000/- p,.m. She denies that the
employees involved in reference were selected by BPCL
officers.
58. It is, therefore, the contention of Mr.Bukhari that
if this material together with the contracts is perused,
then, it is crystal clear that the contracts are sham and
bogus. To appreciate this contention it would be
necessary to consider as to whether a case is made out by
the Union of the contracts being sham and nominal. In
this behalf pleadings and evidence has already been
referred to in details. The Union approached with a
specific case of the contract being sham and bogus. It is
their case that it was just a paper arrangement arrived at
with a view to deprive the concerned workmen of the
benefits of permanency. The petitioner BPCL denied the
case of Union and specifically urged that the contracts
are genuine. It went as far as urging that the employees
were not recruited by BPCL at all. Further case was that
the contracts have been entered into after the
quotations/tenders were invited, duly scrutinized and the
-53-
proper procedure being followed. The contracts having
come into existence thus, they cannot be said to be mere
paper arrangement nor could it be said that they were not
intended to be acted upon. The learned Presiding Officer
has referred to the clauses in the contract to record the
above-mentioned findings. It must be observed, at the out
set, that the documentary evidence in the form of licences
issued by the Government of India, Ministry of Labour
under Contract Labour Act (CL Act) is alone not relevant
and germane.
59. The licences, copies of which have been produced have
been issued in the year 2006 in favour of contractors M/s
Subhash Gardens and M/s R.R.Enterprises. M/s
R.R.Enterprises have been issued contract licence on 16th
November, 2001. However, it has come on record that M/s
R.R.Enterprises were the contractors from 1st September,
2000 to 31st December, 2005. Therefore, the licence which
has been issued and copy of which has been produced as far
as this contract is concerned is of 2001.
60. If the terms and conditions of the contract are
perused, it is agreed that the maintenance works of lawns
at refinery, approximately in the area of 5000 sq. meters
have been purportedly awarded. The scope of work and the
terms and conditions would reveal that it was the duty of
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the contractor to maintain a temporary store cum site
office and staff required for the purpose of horticultural
work. The staff should be adequately experienced and must
consist of malis, helpers, supervisors etc. Further,
adequate number of work at all locations including one
supervisor during the pendency of the contract on all days
except Sundays and Holidays is the responsibility of the
contractor. The materials required for horticultural work
have also to be provided by the contractor along with the
tools. If all these conditions are set out including the
one regarding submission of monthly account bill, it is
clear that by mere production of licence it would not be
permissible to conclude that the contract was in deed
acted upon.
61. Both sides do not dispute that these conditions are
to be found in all contracts, copies of which are produced
before the Industrial Tribunal. It is undisputed that the
copies of all the contracts have not been produced. It is
also not the case of BPCL that it insisted upon compliance
of all terms by the contractor and that is how it released
the payment. Thus, not only the manner, in which
contracts were awarded, the terms were finalised,
documents executed, has not been proved either by BPCL or
by the contractors, at all. There is no payment receipt
produced either by BPCL or by the contractors. There is
-55-
no material with regard to engagement of manpower and
procurement of tools produced by either of them. Thus,
the conclusion drawn that the terms and conditions are
paper arrangement is justified.
62. It is not seriously disputed before me that once the
initial burden is discharged by the Union and it comes
with the clear case of employees being in the regular
establishment and part of permanent work force of BPCL,
then, it was for the BPCL to have proved its case that the
contracts were genuine and not paper arrangement or
intended to be acted upon. Apart from the oral statement
of the witness who is working as a Chief Manager and the
production of copies of contracts and correspondence,
nothing has been produced to show that the contracts were
subsisting all through out and were in accordance with the
terms and conditions referred to above. No proof of
payment to all the contractors has been produced. If the
deposition of the petitioner’s witness is perused, as a
whole, it is apparent that there is no explanation as to
why the order of this Court that the BPCL would continue
the work force/concerned workmen, even if the contractors
were changed, has never been challenged. It is not shown
that new employees were appointed. That order is passed
on 08th January, 1997 and remains operative throughout.
It is in force for nearly a decade. The contractors do
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not dispute that the same workman worked for them. There
is no material but rather clear admissions which are
referred to above. A suggestion was made that the
contractors, mentioned in the affidavit and the contracts
which were produced or atleast some of them, are related
to the officers of BPCL. There are no documents
pertaining to the quantum received by the concerned
employees month to month. No Wage Register or PF Register
or Muster Roll of all contractors for the entire period is
on record.
63. If this material is considered in the backdrop of the
deposition of some of the contractors who stepped into the
witness box, it is clear that they were unable to give
details of how the contracts were worked out. Their
testimony is conspicuous by its silence in so far as the
material terms and more particularly as far as payment and
supervision of work. After the contractors were impleaded
and they filed the written statement they came with
specific cases which are also adverted to above. However,
even the statement made during the cross examination that
subject employees were working with BPCL even prior to the
contracts being executed, speak volume about the
contractors and arrangement contemplated therein.
Moreover, all the contractors have not stepped into the
witness box.
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64. It is in this backdrop, that I see substance in the
contention of Mr.Bukhari that the documents produced, some
of which are styled as Purchase orders, to evidence the
concluded contract, have been rightly discarded and
disbelieved. Further, the reasoning of the Presiding
Officer in paras 18 and 19 cannot be said to be perverse
or based on no evidence. There may be some error or
omission with regard to details but if the learned
Presiding Officer’s order is read as a whole, it cannot be
said that the conclusion arrived at is vitiated as
suggested by Mr.Cama. The Judgment and Order of the Court
below could have been more elaborate and detailed so also
better worded but that is no ground to set aside and quash
the same. More so, when all materials are considered.
65. The tests laid down in this behalf are well settled.
The Supreme Court had occasion to refer to these tests on
number of occasions. The Supreme Court has held that the
control and organisation test is not the only factor which
can be said to be decisive. With a view to find out as to
whether there is relationship of employer and employee,
the Court is required to consider several factors which
would have a bearing on the determination. The identity
of the appointing authority, the identity of the pay
master, time of disposal and extent of control and
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supervision. In para 37 of the decision of the Supreme
Court in the case of Workmen of Nilgiri Coop. Mkt.Society
Ltd. Vs.State of T.N. and others (2004) 3 Supreme Court
Cases 514, the Supreme Court has referred to the tests.
Some of them are very much relevant for the purpose of
present adjudication. The nature of job, nature of
establishment are also relevant factors. It may be true
that the person who sets up a plea of existence of
relationship must carry the burden. However, there is no
decision which is brought to my notice which lays down
that the same never shifts during the course of
adjudication. In this very decision the Supreme Court has
referred to earlier decisions and has held that the
question whether the relationship between the parties is
one of employer and employee is pure question of fact and
ordinarily the High Court in judicial review should not
interfere with this finding unless it is manifestly or
obviously erroneous or perverse. In another decision
reported in A.I.R.2006 Supreme Court page 3229 (Steel
Authority of India Ltd. Vs. Union of India and others),
all the decisions in the field have been referred to. The
Supreme Court has observed that when the contention is
raised that the contract entered into by and between the
management and contractor is sham one, the industrial
adjudicator would be entitled to determine the said issue.
The legal effect of the adjudication would be that if it
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is held that the contract awarded by the management in
favour of the contractor was really camouflage or sham
one, the employees appointed by the contractor in effect
and substance, would be held to be direct employees of the
management. The Court has clearly made a distinction
between abolition of contract labour and the decision that
would be rendered in such adjudication. The 1947 Act
(Industrial Disputes Act) has been extensively referred to
in this decision. However, the Supreme Court in this case
held workmen cannot raise a contradictory and inconsistent
plea. In that case, they had clearly urged that they were
working under the contractors. Therefore, they were not
allowed to urge a destructive plea for the first time
before the Industrial adjudicator that they were
employees/workmen of the principal employer.
66. Before me the case is clear. Nobody has disputed
that the workmen/Union came with a case before the Court
below that they are employees of BPCL and contracts with
the contractor are sham and bogus or nominal/paper
arrangement.
67. It is in this background that I am unable to accept
the contention of Mr.Cama that the workmen are praying for
a relief of regularisation and/or absorption in the
services of Public Sector Undertaking (PSU). This is not
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a case of regularisation or absorption at all. This is a
case where the employees have been through out urging that
they are part of the permanent work force of BPCL. They
cannot be deprived of the benefits of permanency by
showing them as contract labourer. They have produced the
material to show that they have been working for years
together, the work was of perennial and permanent nature,
they were recruited by the BPCL, they may be shown as
working under the contractor but they have never been
thrown out despite the contractors being changed from time
to time. This pleading is substantiated by cogent and
satisfactory evidence. A stray statement or admission
here and there will not destroy the testimony of the
workmen, more so, in the facts peculiar to this case.
When the plea of the contractors being genuine and not
sham is denied vehemently and it is asserted by BPCL that
the same are proper and lawful and the management also
leading evidence, then, this is a case where the rival
pleas and material in support thereof is assessed by the
Tribunal. When both sides have led evidence, then, which
version is reliable and trustworthy is alone the issue for
consideration. Therefore, the management’s version being
disbelieved considering the totality of circumstances does
not mean that this Court must interfere with such a
finding of fact. The consequence of adjudication being
set out by the Hon’ble Supreme Court itself, in my view,
-61-
this case is covered by the judgment of Steel Authority of
India Vs. Union of India and others (supra). In any
event, both sides are bound by the orders and directions
of this Court in writ petition No.800 of 1996. The
adjudication has taken place pursuant to the order and
directions in the same. The terms of reference are
mentioned in the order of this Court and also that of the
Central Government. The issues have been framed based
upon the terms of reference and nobody can question or go
behind them at this stage. Therefore, it is not possible
to accept the contention, now advanced that the Union is
putting forward a case of regularisation or absorption in
the services of BPCL. This is not even a case in the
written statement nor is any material produced during the
course of adjudication to support it.
68. Each of the decision cited by the petitioner on
regularisation and absorption would thus be
distinguishable in the light of what has been observed by
me. This is not a case of contract labour being sought to
be abolished. Similarly, the decision of the learned
single Judge, reported in 2007 II CLR 305 (Majid
(Oomerbhoy Vs.Workmen represented by Bhartiya Kamgar
Karmachari Mahasangh and others) relied upon by Mr.Cama is
clearly distinguishable. That apart, the learned single
Judge has clearly held that preliminary burden of
-62-
establishing that the contract arrangement was sham is
upon the workmen. Thus, a distinction between a
preliminary burden and later on the same shifting on to
the opposite party is laid down clearly. It is in the
facts of that case whether and there being no documentary
evidence that the learned single Judge has held that the
plea that the contract was sham and bogus is not proved.
I have already adverted to the tests which have been
referred to by Mr.Cama. For similar reasons the decisions
with regard to completion of 240 days of continuous
service is something which cannot be said to be germane in
the present controversy. The decision is, therefore,
distinguishable. The decisions under the MRTU and PULP
Act relied upon by Mr.Cama was in the context of casual or
temporary employees upon whom the burden lay to establish
that there is unfair labour practice. Thus, it is also
distinguishable on facts.
69. Steel Authority of India’s decision apart from
supporting Mr.Cama militates against his contentions. The
conclusion in para 21 thereof would reveal that
adjudication in the present case has been undertaken on
the touch stone of the principles laid down therein.
70. It is well settled that no relief of the nature
presently sought can be granted in jurisdiction under
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Article 226 of the Constitution of India. I am not
granting this relief for the first time in writ
jurisdiction but I am considering the challenge to an
order of the Tribunal and the finding rendered by the
Industrial Adjudicator. Whether it is perverse or
vitiated as contended is the question. Therefore, limits
on the powers of this Court under Article 226 in such
matters is something which need not be gone into in the
facts of this case.
71. Thus, all the decisions relied upon by Mr.Cama cannot
be of any assistance to him. In the peculiar facts of
this case and in the light of law laid down in Steel
Authority, Nilgiri and other decisions, it is not
necessary to consider the other judgments relied upon by
Mr.Bukhari. However, the decision of the Supreme Court in
Hussainbhai,Calicut Vs. Alath Factory Thozhilali Union
Calicut and others (1978 II LLJ 397) is directly
applicable and to my mind law laid down therein still
holds the field. The Supreme Court observed thus:
"3. Who is an employee, in Labour Law? That is
the short, die-hard question raised here but
covered by this Court’s earlier decisions. Like
the High Court, we give short shrift to the
contention that the petitioner had entered into
agreements with intermediate contractors who had
hired the respondent union’s intermediate workmen
and so no direct employer-employee vinculum Juria
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existed between the petitioner and the workmen.
4. This argument is impeccable in Laissex fairs
economics "red in tooth and claw" and under the
Contract Act rooted in English Common Law. But the
human gap of a century yawns between this strict
doctrine and industrial jurisprudence. The source
and strength of the industrial branch of Third
World Jurisprudence is social justice proclaimed in
the preamble to the Constitution. This Court in
Ganesh Beedi’s case (194-I L.L.J.367) has raised on
British and American rulings to hold that mere
contracts are not decisive and the complex of
considerations relevant to the relationship is
different. Indian Justice, beyond Atlantic
liberalism, has a rule of law which runs to the aid
of the rule of life. And life, in conditions of
poverty aplenty, is livelihood and livelihood is
work with wages. Raw social realities, not fine
spun legal niceties, not competitive market
economics but complex protective principles, shape
the law when the weaker, working class sector needs
succour for livelihood through labour. The
conceptual confusion between the classical law of
contracts and the special branch of law sensitive
to exploitative situations accounts for the
submission that the High Court is in error in its
holding against the petitioner.
5. The true test may, with brevity, be indicated
once against. Where a worker or group of workers
labours to produce goods or services and these
goods or services are for the business of another,
that other is, in fact, the employer. He has
economic control over the workers’ subsistence,
skill and continued employment. If he, for any
reason, chokes off, the worker is, virtually, laid
off. The presence of intermediate contractors with
whom alone the workers have immediate or direct
relationship ex contractu is of no consequence
when, on lifting the veil or looking at the
conspectus of factors governing employment, we
discern the naked truth, though draped in different
perfect paper arrangement, that the real employer
is the Management, not the immediate contractor.
Myriad devices, half hidden in fold after fold of
legal form depending on the degree of concealment
needed, the type of industry, the local conditions
and the like may be resorted to when labour
legislation casts welfare obligations on the real
employer, based on Arts. 38, 39, 42, 43 and 43A of
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the Constitution. The Court must be astute to
avoid the mischief and achieve the purpose of law
and not be misled by the maya of legal appearance.
6. If the livelihood of the workmen substantially
depends on labour rendered to produce goods and
services for the benefit and satisfaction of an
enterprise, the absence of direct relationship or
the presence of dubious intermediaries or the make
believe trappings of detachment from the management
cannot snap the real life bond. The story may vary
but the inference defies ingenuity. The liability
cannot be shaken off."
72. Way back in 1963 the Supreme Court had an occasion
to consider more or less identical controversy. There,
the issue was of gardeners/malis. The decision reported
in AIR 1964 Supreme Court Page 737 in the case of
M/s.J.K.Cotton Spinning and Weaving Mills Co. Ltd. Vs.
The Labour Appellate Tribunal of India, IIIrd Branch,
Lucknow and others may have been rendered in the context
of U.P Industrial Disputes Act but the Supreme Court in
paragraphs 11 to 13 and thereafter in 19 made very
pertinent observations. In para 19 this is what is
observed:
"(19) Then Mr.Pathak was driven to contend that
the ground of social justice given by the Labour
Appellate Tribunal in support of its award is
really no sound in law, and he referred us to the
observations made by this Court on some occasions
that the considerations of social justice were "not
only irrelevant but untenable" vide J.K.Iron and
Steel Co.Ltd., Kanpur v. Iron and Steel Mazdoor
Union, Kanpur, 1955-2 SCR 1315: (AIR 1956 SC 231)
and Muir Mills Co. Ltd. v. Suti Mills Mazdoor
Union, Kanpur, 1955-1 SCR 991: ((S) AIR 1955 SC
170). In our opinion, the argument that the
considerations of social justice are irrelevant and
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untenable in dealing with industrial disputes, has
to be rejected without any hesitation. The
development of industrial law during the last
decade and several decisions of this Court in
dealing with industrial matters have emphasised the
relevance, validity and significance of the
doctrine of social justice: vide Messrs. Crown
Aluminium Works v. Their Workmen, 1958 SCR 651:
(AIR 1958 SC 30) and State of Mysore v. Workers of
Gold Mines, 1959 SCR 895: (AIR 1958 SC 928).
Indeed, the concept of social justice has now
become such an integral part of industrial law that
it would be idle for any party to suggest that
industrial adjudication can or should ignore the
claims of social justice in dealing with industrial
disputes. The concept of social justice is not
narrow, or one-sided, or pedantic, and is not
confined to industrial adjudication alone. Its
sweep is comprehensive. It is founded on the basic
ideal of socio-economic equality and its aim is to
assist the removal of socio-economic disparities
and inequalities; nevertheless in dealing with
industrial matters, it does not adopt a doctrinaire
approach and refuses to yield blindly to abstract
notions, but adopts a realistic and pragmatic
approach. It, therefore, endeavours to resolve the
competing claims of employers and employees by
finding a solution which is just and fair to both
parties with the object of establishing harmony
between capital and labour, and good relationship.
The ultimate object of industrial adjudication is
to help the growth and progress of national economy
and it is with that ultimate object in view that
industrial disputes are settled by industrial
adjudication on principles of fair-play and
justice. That is the reason why on several
occasions, industrial adjudication has thought it
fit to make reasonable provision for leave in
respect of the workmen who may not strictly fall
within the purview of the Factories Act or the
Shops and Commercial Establishments Act. We are,
therefore, satisfied that there is no substance in
the grievance made by Mr.Pathak that the Labour
Appellate Tribunal should not have granted the
demand of the respondents for leave on grounds of
fair-play and social justice."
This decision of the Supreme Court and some of the
observations therein have found favour in later decisions
-67-
and the decision in the case of Secretary, Haryana State
Electricity Board Vs. Suresh and other etc reported in
AIR 1999 Supreme Court 1160 = ((1999) 3 S.C.C. 601) is
indicative of the fact that the law laid down in earlier
decisions has neither been diluted or over-ruled. The
views of Hon’ble Mr.Justice Gajendragadkar on, the point
(supra) is still a good law.
73. Thus, in all such matters, it is the duty of the
Court, wherever the attempt is to avoid welfare
legislations, to get behind the smoke-screen and discover
the true state of affairs. The Court should not be
satisfied with the form and leave alone substance of a
transaction (See AIR 1986 S.C. 1 - The Workmen Employed
in Associated Rubber Industry Ltd, Bhavnagar v. The
Associated Rubber Industry Ltd., Bhavnagar and another).
In the case of Secretary H.S.E.B Vs. Suresh and ors.
(supra), the Supreme Court has in paras 9 and 18, observed
thus:
"9. The High Court did in fact note with care
and caution the doctrine of ‘lifting of veil’ in
industrial jurisprudence and recorded that in the
contextual facts and upon lifting of the veil,
question of having any contra opinion as regards
the exact relationship between the contesting
parties would not arise and as such directed
reinstatement though however, without any back
wages. While it is true that the doctrine
enunciated in Saloman v. Saloman, 1897 Appeal
Cases 22 came to be recognised in the corporate
jurisprudence but its applicability in the present
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context cannot be doubted, since the law Court
invariably has to rise up to the occasion to do
justice between the parties in a manner as it deems
fit. Rescopound stated that the greatest virtue of
the law Court is flexibility and as and when the
situation so demands, the law Court ought to
administer justice in accordance therewith and as
per the need of the situation.
18. As noticed above Draconion concept of law
is no longer available for the purpose of
interpreting a social and beneficial piece of
legislation specially on the wake of the new
millenium. The democratic polity ought to survive
with full vigour:socialist status as enshrined in
the Constitution ought to be given its full play
and it is in this perspective the question
arises-is it permissible in the new millennium to
decry the cry of the labour force desirous of
absorption after working for more than 240 days in
an establishment and having their workings
supervised and administered by an agency within the
meaning of Article 12 of the Constitution-the
answer cannot possibly be in the affirmative-the
law Courts exist for the society and in the event
law Courts feel the requirement in accordance with
principles of justice, equity and good conscience,
the law Courts ought rise up to the occasion to
meet and redress the expectation of the people.
The expression ‘regulation’ cannot possibly be read
as contra public interest but in the interest of
public."
74. Lastly, Mr.Cama’s contention overlooks the basic and
fundamental aspect of the matter. If a Public Sector
Undertaking or an Authority which is performing a public
duty and is incharge of public funds, so also subserving
public interest, enters into paper arrangement or nominal
contract, then, it is the public interest which suffers.
Mr.Cama’s contention overlooks the fact that when it comes
to public sector undertaking, at stake is public interest.
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The public trust doctrine which has been enshrined in the
Constitution so also the decisions of the Supreme Court,
comes into play. The Management and workmen of such
undertakings and companies are Trustees of the people.
Therefore, public at large should not suffer the
consequences of such an arrangement. If the contract is
not genuine, it is the public which suffers because their
funds go down to the drain. More so in case of fulfilling
a statutory duty for Protection of environment and
Ecology, again in public interest. Therefore, the element
of public interest and consumer protection cannot be
overlooked in such matters. Therefore, not only
management and workers but even the public interest must
be protected. If the contract is genuine only then
relationship of employer and employee between the
contractor and the concerned workmen can come into play.If
it is not genuine but sham, then, the contractor must go
out of picture and as far as employees are concerned they
come in direct contact and relationship with PSU.
Therefore, whether the contract is sham, bogus or nominal
must be decided qua public sector undertaking considering
the facts peculiar to each case. However, the above
aspects pertaining to public policy and general principles
of public interest outlined above cannot be brushed aside.
75. It is in this light as well that I am unable to
-70-
uphold the contention of the petitioner that the impugned
order must be quashed and set aside. The petition,
therefore, fails. Rule discharged. No order as to costs.
(S.C.DHARMADHIKARI J.)
Colour shows how this judgement treated each authority
Steel Authority of India Ltd. vs. National Union Water Front WorkersFollowed¶69
(2001) III CLR 349
Workmen of Nilgiri Coop. Mkt. Society Ltd. vs. State of T.N.Followed¶71
(2004) 3 Supreme Court Cases 514
Hussainbhai Calicut vs. Alath Factory Thozhilali UnionFollowed¶71
(1978) II LLJ 397
Secretary, Haryana State Electricity Board vs. SureshFollowed¶73
(1999) I CLR 959
2 provisions across 2 enactments
Bharat Petroleum Corporation Ltd.
Petroleum Employees' Union
Sunil Kashinath Dasade
S.C. DHARMADHIKARI
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court