Karnataka High Court
M/S. Bosch Limited vs Labour Through Karnataka Rakshak on 19 December, 2024
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 19TH DAY OF DECEMBER, 2024
PRESENT
THE HON'BLE MRS. JUSTICE ANU SIVARAMAN
AND
THE HON'BLE MR. JUSTICE UMESH M ADIGA
WRIT APPEAL NO.399 OF 2019 (L-TER)
BETWEEN:
M/s. BOSCH LIMITED
NAGANATHAPURA PLANT
POST BOX No.6887
ELECTRONICS CITY P.O.
BENGALURU-560 100
REPRESENTED BY Mr. P.L. MATHEW
SENIOR GENERAL MANAGER
(HUMAN RESOURCES)
NOW REPRESENTED BY GANESH B.
FACTORY MANAGER
...APPELLANT
(BY SRI. K. KASTURI, SENIOR COUNSEL FOR
SMT. K. SUBHA ANANTHI, ADVOCATE)
AND:
LABOUR THROUGH KARNATAKA RAKSHAK
AND GENERAL WORKERS UNION
REPRESENTED BY ITS PRESIDENT
No.43, M.I.G. 2ND FLOOR
2ND STAGE, K.H.B. COLONY
BASAVESHWARA NAGAR
BENGALURU-560 079
...RESPONDENT
(BY SMT. MAITREYI KRISHNAN, ADVOCATE)
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THIS WRIT APPEAL IS FILED U/S 4 OF THE KARNATAKA
HIGH COURT ACT, 1961 PRAYING TO SET ASIDE THE ORDER OF
THE LEARNED SINGLE JUDGE DATED 14.01.2019, IN WP
No.41072/2012 (L-TER) AND ETC.
THIS WRIT APPEAL HAVING BEEN HEARD AND RESERVED
FOR JUDGMENT ON 19.11.2024 AND COMING ON FOR
PRONOUNCEMENT OF JUDGMENT THIS DAY, ANU SIVARAMAN
J., PRONOUNCED THE FOLLOWING:
CORAM: HON'BLE MRS. JUSTICE ANU SIVARAMAN
and
HON'BLE MR. JUSTICE UMESH M ADIGA
CAV JUDGMENT
(PER: HON’BLE MRS. JUSTICE ANU SIVARAMAN)
This writ appeal is filed challenging the order dated
14.01.2019 passed by the learned Single Judge in
W.P.No.41072/2012 (L-TER) and the order dated
04.04.2009 and the award dated 23.08.2012 passed by the
II Additional Labour Court, Bengaluru (hereinafter referred
to as the ‘Labour Court’ for short) in Reference No.32/1998.
2. We have heard Smt. K. Kasturi, learned Senior
Counsel as instructed by Smt. Subha Ananthi, learned
counsel appearing for the appellant and Smt. Maitreyi
Krishnan, learned counsel appearing for the respondent.
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3. It is submitted by the learned Senior Counsel
appearing for the appellant that the appellant is a Company
engaged in manufacturing automobile accessories, with it’s
registered office in Bengaluru and a plant at Naganathapura.
A dispute was raised by an external union on behalf of
security guards employed through contractors at the
appellant’s Naganathapura plant, seeking
regularization/absorption of these guards. The matter was
referred to the Labour Court as Reference No.32/1998,
where the parties submitted their claim statements. On
05.10.2000, the Labour Court framed preliminary issues
regarding maintainability of the dispute, following which
evidence was led by both the parties.
4. It is submitted that during the proceedings, MW-
1, representing the Management, was cross-examined.
Additional witnesses for the workmen were examined; the
cross-examination of WW-3 was completed on 10.06.2008.
The appellant sought permission to lead further evidence,
which was opposed by respondent on 17.06.2008. On
08.07.2008, the Labour Court rejected this application and
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the same was challenged in W.P.No.10243/2008, wherein
this Court, by order dated 04.08.2008, reserved liberty to
the appellant to challenge the Labour Court’s order, post the
final award and remanded the matter for adjudication. The
numerous documents were submitted as evidence, including
certificates of registration, contractor lists and agreements
(Ex.M1 to Ex.M6). Additional exhibits included service
contracts with security providers, wage statements and
correspondence with the Labour Commissioner. Key
evidence was marked without objections, such as the
certification of contractors (Ex.M3), Form-20 regarding
contract work (Ex.M6) and settlement agreements between
the appellant and its contractors (Ex.M16).
5. It is further submitted that on 04.04.2009, the
Labour Court held that the dispute, despite issues of
improper espousal was maintainable due to community of
interest and employer-employee relationship between the
appellant and the security guards. The appellant challenged
order of the Labour Court in W.P.No.27075/2009 but later
withdrew the petition, reserving right to contest the order,
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post final award. The respondents filed W.P.
No.32767/2009, resulting in this Court remanding the case
to the Labour Court to address the issue of a sham contract
and pass a final award. Additional evidence was recorded
and several witnesses were examined, including
representative – Mr.Col.Kolhatkar, from M/s. Terrier Security
Systems (MW2), Unique Detective Services and Guardwell
Detective Services. Contracts and related documents were
marked as exhibits (Ex.M25 to M79), covering details of
contract extensions, financial transactions and statutory
compliance. Specific exhibits, such as Ex.M67
(acknowledged extended contracts) and Ex.M73 (contractor
bills), provided detailed accounts of operations and
payments.
6. It is submitted that the Labour Court, after
completing the evidence on the issue of a sham contract,
passed an award on 23.08.2012, declaring the contract as
sham. This decision granted the respondent-Union benefits,
including regularization and arrears of wages. The appellant
contested the findings of the Labour Court, asserting that
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the evidence, particularly Exs.M1 to M18, was not
adequately considered in an order dated 04.04.2009. The
appellant further highlighted its financial difficulties, citing
losses of 7.2% in turnover for the year 2008, with spark
plug operations recording fluctuating financial results over
the years (losses of 4.59% in the year 2006, profit of 2% in
the year 2007 and 0.1% in the year 2008). The global
recession compounded challenges, leading to operational
shutdowns for extended periods. Despite these constraints,
the decision of the Labour Court imposed additional financial
liabilities on the appellant. In the light of these
developments, it is also submitted that the contractual
arrangements in security services were not abolished and
maintained that the findings of the Labour Court were
unsustainable.
7. It is contended by the learned senior counsel
appearing for the appellant that the issues raised by the
appellant are comprehensively addressed by several judicial
precedents, including the full bench judgment of this Court
in Steel Authority of India Limited v. Steel Authority of
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India Ltd. Contract Workers Union and Others, reported
in (Full Bench) Vol.80 FJR KAR 149, the Constitution
Bench judgment of the Apex Court in Steel Authority of
India Ltd. and Others, v. National Union Water Front
Workers and Others, reported in 2001 (2) LLJ SC 1087,
and other relevant rulings such as Gujarat Electricity
Board, Thermal Power Station, Gujarat v. Hind
Mazdoor Sabha and Others, reported in 1995(2) LLJ SC
790, Dena Nath and Ors. v. National Fertilizers Ltd.
reported in (1992 (1) LLJ SC 289, R.K. Panda and
Others v. Steel Authority of India and Others, reported
in Vol.85 FJR SC 140 and in Food Corporation of India
and Others v. Presiding Officer, Central Government
Industrial Tribunal cum-Labour Court-1, Chandigarh
and Others, reported in 2008 (1) LLR 391 and
International Airport Authority of India v.
International Air Cargo Workers’ Union an Another,
reported in 2009 LLR SC 923. The appellant asserts that
the judgment of the learned Single Judge contradicts these
precedents and the factual record, particularly, regarding
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the relationship between the appellant and the contract
labour represented by the respondent – Union. The learned
Single Judge erred by affirming the Labour Court’s
conclusion that an employer-employee relationship existed
between the appellant and the contract labour. The learned
Single Judge, failed to properly exercise the jurisdiction to
quash the erroneous award and order of the Labour Court,
which were not supported by the law or facts.
8. It is further contended that the learned Single
Judge also committed a similar mistake as the Labour Court
in holding that there was a community of interest between
the persons raising the dispute. According to the appellant,
such a community of interest is only applicable when an
union of the employer supports the cause of its employees,
as clarified by the Apex Court in Bombay Union of
Working Journalists and Others v. “Hindu”, Bombay
and Another, reported in Vol.XXI FJR 207; and Gujarat
Electricity Board‘s case (supra). However, in this case,
there was no such Union representation for the contract
labour. The learned Single Judge failed to recognize that the
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individuals named in the order of Reference were never
employed from 01.04.1989, as claimed by the respondent.
This factual inaccuracy led to a wrongful conclusion by both
the Labour Court and the learned Single Judge.
9. It is also contended that the learned Single Judge
incorrectly concluded that the appellant’s case was settled
by a prior Labour Court ruling regarding the employer-
employee relationship, which could not be challenged.
However, the issue of employment from 1989 was never
applicable, as the relevant evidence from 1990 onward–
provided by witnesses such as Mr. P.L.Mathew (MW-1), Mr.
Jaffer Khan (MW-5) and Mr. Kolhatkar (MW-2) – was
disregarded by the learned Single Judge. The learned Single
Judge failed to consider the actual evidence, particularly
from the contractors and their supervisors, who clearly
testified that the contract labour, were employed by the
contractors and supervised by them. The appellant further
highlights that even disciplinary actions were taken by the
contractors, which disprove the claim of a direct employer-
employee relationship with the appellant.
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10. It is contended that the learned Single Judge’s
assumption that the contract labour arrangement was a
mere facade and that badges and uniforms provided by the
contractor could somehow establish an employment
relationship with the appellant was fundamentally flawed, as
it overlooks the actual employer-employee relationship
between the contract workers and their contractors. The
learned Single Judge wrongly ignored the documentary
evidence regarding payment of statutory benefits like
Provident Fund and ESI, etc., which were duly made by the
contractors, not the appellant. Therefore, the orders of the
Labour Court dated 04.04.2009, the award dated
23.08.2012 and the subsequent order of the learned Single
Judge dated 14.01.2019, should be set aside in the interest
of justice.
11. It is contended that the admissions made by WW-
1, which were noted in the order of the learned Single Judge
dated 14.01.2019, have been ignored, despite their clear
implications. These admissions explicitly establish that the
respondent-Union is contract labourers. The respondent-
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Union have worked under three different contractors since
their initial appointment, as per the order of Reference dated
07.02.1998. Furthermore, the question of granting
regularization as sought by the respondent-Union does not
arise, as there has been no abolition of contract labour in
the field of security, nor does the law prohibit the
engagement of contract labour in such capacities. Therefore,
the findings of the Labour Court and the learned Single
Judge are erroneous and should be set aside.
12. It is further contended that the evidence
presented by WW-2, Mr. Shivashankar, confirms that the
three defendants in O.S.No.242/1997 are indeed contract
labourers. In his cross-examination, Mr. Shivashankar
admitted that contract supervisors regularly supervised the
security personnel, which further corroborates the claim that
the respondent-Union was employed under contractors. The
observation by the learned Single Judge that the 72
workmen have been working with the appellant – Company
since its inception is contrary to the evidence of MW-1, who
stated that the respondent – Union were engaged only from
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the dates specified in the order of Reference. This finding is
unsupported by the evidence on record and must be set
aside. Similarly, the statement in paragraph No.27 of the
order regarding the duty roster and names of shift-in-charge
requires further clarification, as it fails to consider the
involvement of contractors in supervising the work of the
respondent – Union, as confirmed by MW-5, Mr. Jaffer Khan.
13. It is contended that WW-1 admitted that the
respondent-union were not members of MICO Karmikara
Sangha and that the Management of the second party was
responsible for paying the salaries to the respondent-union.
This significant admission was disregarded by the Labour
Court and the learned Single Judge. Moreover, WW-1’s
statement regarding lack of licenses for security contractors,
including M/s.Terrier Security Systems, Guardwell or Unique,
is contradicted by the evidence on record, rendering this
claim baseless and unsupported. The learned Single Judge’s
observation that the attendance registers for various periods
bear the initials of MW-1, P.L. Mathew, is flawed, as it does
not align with the documentary evidence or the cross-
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examination testimony of WW-1, who identified the
signatures as belonging to Mr. L.P. Rao. This discrepancy in
signatures, particularly between those of Mr. P.L. Mathew
and Mr. L.P. Rao, has not been addressed adequately by the
learned Single Judge or the Labour Court.
14. In support of the contentions raised, the learned
Senior Counsel placed reliance on the following decisions:-
• The Workmen of the Food Corporation of India v.
M/s. Food Corporation of India reported in 1985(2)
LLJ SC 4;
• Workmen of Nilgiri Coop. Mkt. Society Ltd. v. State
of T.N. and Others reported in (2004) 3 SCC 514;
• Steel Authority of India Ltd. v. Union of India and
Others reported in 2006 (3) LLJ SC 1037;
• Tumkur Poura Karmikara Sangha (Regd.), Tumkur
v. Municipal Council, Tumkur and Another reported in
2009(4) LLJ 709 (Kant);
• General Manager (OSD), Bengal Nagpur Cotton
Mills, Rajnandgaon v. Bharat Lal and Another
reported in (2011) 1 SCC 635;
• Bhartiya Kamgar Sena v. Udhe India Ltd and
Another reported in 2008 (1) LLR 344;
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• Himmat Singh & Others v. I.C.I. India Ltd. & Ors,
reported in 2008 (1) LLR 357;
• The Management of Madura Mills Company Limited
v. The Presiding Officer, Industrial Tribunal, Madras
and Others reported in 1973 (2) LLJP 341;
• Cement Corporation of India Ltd. v. Presiding
Officer, Labour Court-cum-Industrial Tribunal,
Hissar and Others reported in 2010 (2) LLJP 548 (P
& H);
• National Thermal Power Corporation and Others v.
Badri Singh Thakur and Others reported in (2008) 9
SCC 377;
• Steel Authority of India Ltd. v. Union of India and
Others reported in 2006 (4) LLN 651;
• Madras Refineries Limited and Others v. The Chief
Commissioner for Persons with Disabilities and
Others reported in 2012 (3) LLN 399 (Mad.);
• Bharath Electronics Contract Labour Union and
Others v. M/s. Bharath Electronics Limited, reported
in ILR 2012 KAR 1653;
• The Management of BWSSB, Cauvery Bhavan and
Others v. M. Mahadeva and Others reported in 2016
LLR 36;
• Balwant Rai Saluja and Another v. Air India Ltd and
Others reported in 2014 LLR 1009;
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• Workmen of Motor Industries Company Limited v.
The Management of Motor Industries Company
Limited, by Order dated 21.01.2010 passed in Writ
Petition No.32767 of 2009 (L-RES);
• Chief Engineer, Hydel Project and Others v.
Ravinder Nath and Others reported in (2008) 2 SCC
350;
• Kiran Singh and Others v. Chaman Paswan and
Others reported in AIR 1954 SC 340;
• A.R. Antulay v. R.S. Nayak and Another reported in
AIR 1988 SC 1531;
• Milkhi Ram v. Himachal Pradesh State Electricity
Board reported in (2021) 10 SCC 752;
• The Management of Kalpana Theatre etc. v. B.S.
Ravishankar Major and Others reported in AIR 1995
Kar 426;
• Caparo Engineering India Ltd v. Ummed Singh Lodhi
and Another by Order dated 26.10.2021 passed in
Civil Appeals No.5829-5830 of 2021;
• State of M.P. and Others v. Visan Kumar Shiv
Charan Lal reported in AIR 2009 SC 1999;
• Tammanna D. Battal and Others v. Miss Renuka R.
Reddy and Others reported in AIR 2009 Kar 119; and• Kirloskar Brothers Limited v. Ramacharan and
others reported in (2023) 1 SCC 463.
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15. It is contended by the learned counsel appearing
for the respondent that initially the Labour Court held that
the dispute was maintainable and confirmed that 72
workmen employed in the Watch and Ward Department
were directly employed by the appellant and issued an
Award dated 23.08.2012, affirming that the 72 workmen
were the direct employees of appellant – Company and
entitled to absorption into the workforce. The Award granted
consequential benefits, including pay scales, arrears and
other benefits specified therein to these workmen. The
appellant, dissatisfied with these findings, filed
W.P.No.41072/2012, which was dismissed by the learned
Single Judge dated 14.01.2019.
16. It is also contended that the order passed by the
learned Single Judge is within the jurisdiction and powers
conferred under Article 227 of the Constitution of India.
Consequently, an intra-court appeal against such an order is
barred under Section 4 of the Karnataka High Court Act,
1961. This position was upheld in the decision of the this
Court in Management of Bharath Fritz Werner Ltd. vs
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Bharath Fritz Werner Karmikara Sangha by order dated
29.06.2022 in W.A.No.497/2022, where it was held that
the orders under Article 227 are not the subject to intra-
court appeal.
17. It is contended by the learned counsel appearing
for the respondent that the workmen were employed at the
Naganathapura Plant of the appellant – Company from its
inception on 01.04.1989, as corroborated by the claim
statement and the admissions of MW-1 in evidence. It is a
settled legal principle that admitted facts do not require
additional proof. Further, it was highlighted that the
appellant lacked the requisite registration certificate under
Section 7 of the Contract Labour (Regulation and Abolition)
Act, 1970 (for short ‘CLRA Act‘) at the time of appointment.
The certificate dated 21.04.1994, and subsequent
agreements with contractors starting 25.08.1995, suggests
the absence of any lawful contractual relationship during the
relevant period.
18. It is contended that the contract between the
appellant and the purported contractor was a sham and
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merely a cover-up after the workmen began asserting their
rights. Evidence showed that the appellant exercised
complete supervision and control over the workmen,
including wage disbursement, allowances and contributions
to ESI and PF. MW-1 was testified to collect and distribute
these payments on behalf of the appellant. These factors
collectively demonstrated that the appellant was the actual
employer of the workmen, undermining the claim of a
contractual arrangement.
19. With regard to the authorities furnished by the
learned senior counsel appearing for the appellant, it is
contended as follows:-
(i) Steel Authority of India v. Steel Authority of
India Ltd. Contract Workers Union and Ors. [Col 80
FJR Kar Page 149]: In this case, the question before the
Court was when the principal employer had a registration
certificate, and the contractor did not have a licence,
whether the workers would be deemed to be the
employees of the principal employer. In fact, it is noted
therein “From the above it is clear that there is a bar
against a principal employer from employing contract
labour without being registered under Section 7“(Para
16). In the instant case, the appellant did not have a
registration certificate under Section 7 and there was no
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agreement entered into. Hence the said judgment is
clearly distinguishable and cannot be relied upon.
(ii) Dena Nath and Others. v. National Fertilizers Ltd.
[1992 (1) LLJ SC Page 289]: The Hon’ble Supreme
Court in this case was considering the powers of the High
Court in respect of abolition of contract under Section 10
of the Contract Labour Act, and hence the same is not
relevant in the instant case.
(iii) Workmen of Food Corporation of India v.
Management of Food Corporation of India [1985(2)
LLJ SC Page 4]: This case lays down the law that when a
worker has been employed by an employer, he cannot
thereafter be shifted to a contractor, and such action
would be void, and the worker would continue to be
employed by the original employer. The instant Authority
supports the case of the respondent workmen [Para 15]
(iv) R.K. Panda and Ors. v. Steel Authority of India
and Ors. [Vol.85 FJR SC 140]: This judgment is in
regard to regularization of the workers, and not in regard
to sham contracts and hence is not applicable in the
instant case.
(v) Gujarat Electricity Board v. Hind Mazdoor Sabha
[(1995) 5 SCC 27]: In this case, the law has been laid
down that when the contract is sham and not genuine,
the workmen of the so-called contract can themselves
raise an industrial disputes (Para 53). This clearly shows
that the Respondent workmen had the locus standi to
raise the industrial dispute
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(vi) Steel Authority of India v. Union of India
(2006)12 SCC 233: The case is in regard to abolition of
contract labour under Section 10 and hence cannot be
relied upon herein.”
20. It is further contended that the other authorities
relied upon are clearly distinguishable on facts and have no
bearing on the instant case. Hence, it is prayed that the
appeal be dismissed.
21. In support of the contentions raised, the counsel
placed reliance on the following decisions:-
• Radhey Shyam and Another v. Chhabi Nath and
Others reported in (2015) 5 SCC 423;
• Kiran Devi v. The Bihar State Sunni Wakf Board and
Others, by Order dated 05.04.2021 passed in Civil
Appeal No.6149 of 2015;
• K.V. Shetty v. The Sr. Vice President, by Order dated
26.02.2020 passed in W.A.No.100215/2017 (L-
RES);
• The Alahar Co-operative Credit Service Society v.
Sham Lal reported in LAWS(SC)-1996-5-120;
• The Bharat Bank Ltd., Delhi v. The Employees of the
Bharat Bank Ltd., Delhi reported in AIR (37) 1950 SC
188;
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• Caparo Engineering India Ltd v. Ummed Singh Lodhi
and Another by Order dated 26.10.2021 passed in
Civil Appeals No.5829-5830 of 2021;
• M/s. Mitra S.P. (P) Ltd. & Another v. Dhiren Kumar,
by Order dated 22.07.2022 passed in Special Leave
Petition (Civil) Diary No(s).15875/2022;
• Gurushanth Pattedar v. Mahaboob Sbahi Kulburga
Mills and Another reported in ILR 2005 KAR 2503;
• Gujarat Steel Tubes Ltd. v. Gujarat Steel Tubes
Mazdoor Sabha, by Order dated 19.11.1979 passed
in C.A.No.1212 and 2237 of 1978;
• Shyam Narayan Prasad v. Krishna Prasad and
Others reported in (2018) 7 SCC 646;
• Shankar Chakravarti v. Britannia Biscuit Co. Ltd and
Another reported in AIR 1979 SC 1652;
• Union of India v. Varma (T.R.), by Order dated
18.09.1957 passed in Civil Appeal No.118 of 1957;
• The Management of M/s. Stumpp, Schule and
Somappa Springs Pvt. Ltd. v. Sri. U. Mallikarjuna, by
Order dated 21.10.2024 passed by WA No.1685 of
2018 (L-TER);
• Workmen of M/s. Dharam Pal Prem Chand
(Saugandhi) v. Dharam Pal Prem Chand
(Saugandhi) reported in 1965 SCC OnLine SC 128;
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• M/s. Tata Chemicals Ltd v. The Workmen, Rep by
Chemicals Kamdar Sangh reported in (1978) 3 SCC
42;
• Gujarat Electricity Board, Thermal Power Station,
UKAI, Gujarat v. Hind Mazdoor Sabha and Others
reported in (1995) 5 SCC 27;
• Hussainbhai v. The Alath Factory Tezhilali Union
and Others reported in AIR 1978 SC 1410;
• Dharangadhara Chemical Works Ltd v. State of
Saurashtra and Others reported in AIR 1957 SC 264;
• Shivnandan Sharma v. The Punjab National Bank
Ltd reported in AIR 1955 SC 404;
• Secretary, H.S.E.B. v. Suresh and Others reported in
(1999) 3 SCC 601;
• Indian Petrochemicals Corporation Ltd. and Another
v. Shramik Sena and Others reported in AIR 1999 SC
2577;
• Indian Overseas Bank v. I.O.B. Staff Canteen
Workers’ Union and Another reported in AIR 2000 SC
1508;
• M/s. Bharat Heavy Electrical Ltd. v. State of U.P.
and Others reported in AIR 2003 SC 3024;
• The Management of National Aerospace
Laboratories v. Engineering & General Workers
Union and Another reported in ILR 2015 KAR 349;
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• Aeronautical Development Agency and Others v.
Nanjamma and Others reported in 2012 SCC OnLine
Kar 8840;
• Hindustan Petroleum Corporation Limited and
Others v. Shivananda and Others reported in
MANU/KA/0683/2016;
• Sankar Mukherjee and Others v. Union of India and
Others reported in 1990 (Supp) SCC 668;
• Bhilwara Dugdh Utpadak Sahakari S. Ltd. v. Vinod
Kumar Sharma, dead by L.Rs., and Others reported in
AIR 2011 SC 3546;
• Sudarshan Rajpoot v. Uttar Pradesh State Road
Transport Corporation reported in (2015) 2 SCC 317;
• ONGC Ltd v. Petroleum Coal Labour Union and
Others reported in AIR 2015 SC 2210;
• BEML Limited v. The President Mysore Divison
General Labour Association and Others reported in
MANU/KA/1132/2015;
• State of Bombay and Others v. Hospital Mazdoor
Sabha and Others, reported in 1960 SCC OnLine SC
44;
• M/s. J.K. Cotton Spinning and Weaving Mills Co. Ltd
v. The Labour Appellate Tribunal of India, IIIrd
Branch, Lucknow and Others reported in AIR 1964
SC 737;
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• Harjinder Singh v. Punjab State Warehousing
Corporatio, reported in (2010) 3 SCC 192;
• Sangram Singh v. Election Tribunal Kotah and
Another reported in AIR 1955 SC 425;
• Syed Yakoob v. K.S. Radhakrishnan and Others
reported in AIR 1964 SC 477;
• Management of Mysore Paper Mills Limited,
Bhadravathi v. General Secretary, Mysore Paper
Mills Workers’ Association (Work Order),
Bhadravathi reported in .2009 SCC OnLine Kar 222;
• Management of Mysore Paper Mills Ltd., v. General
Secretary Mysore Paper Mills Workers Association
(Work Order) by Order dated 18.01.2012 passed in
Writ Appeal No.2148/2009 (L-RES);
• Commissioner of Income Tax (Central) v. B.N.
bhattacharjee and Another reported in (1979) 4 SCC
121;
• Workmen of Motor Industries Company Limited v.
The Management of Motor Industries Company
Limited by Order dated 21.01.2010 passed in Writ
Petition No.32767 of 2009 (L-RES) and
• State of Maharashtra v. Labour Law Practitioners’
Association and Others reported in (1998) 2 SCC
688.
22. Having considered the contentions advanced, we
are of the opinion that though extensive contentions are
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raised with regard to the legality of the findings of the
learned Single Judge as well as the Labour Court, the actual
point for consideration lies in a very narrow compass. In
view of the conflicting judgments on the point of
maintainability of the writ appeal, we have examined the
judgment of the learned Single Judge, we find that in the
instant case, the findings of the Labour Court are challenged
not only on the grounds available under Article 227 of the
Constitution of India but on merits as well. We are therefore
of the opinion that the exercise undertaken by the learned
Single Judge could have been under Article 226 of the
Constitution of India and as such, it would not be proper to
non-suit the appellant on maintainability. We therefore
proceed to consider the appeal.
23. It is an admitted fact that a new factory was
established by the Management which started functioning in
the year 1989. The said new plant was admittedly a
separate and distinct establishment as defined under the
CLRA Act. The establishment had obtained registration under
the CLRA Act as a principal employer only on 21.04.1994.
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This fact is not disputed even before us in these
proceedings. The Labour Court had specifically entered a
finding to this effect on the basis of the pleadings and the
evidence on record. The learned Single Judge has also
specifically noticed this fact. Even in appeal, the appellant
has no case, on facts, to the contrary.
24. It is not in dispute that the CLRA Act is enacted to
regulate the employment of Contract Labour and to provide
for its abolition in certain circumstances. It is undoubtedly, a
social welfare legislation enacted for the welfare of
labourers, whose conditions of service are unsatisfactory and
is therefore required to be liberally construed. Socio-
Economic legislation which is aimed at social or economic
policy changes, the interpretation should not be narrow and
should prospectively favour the weaker and poor class.
25. Section 7 of the CLRA Act, reads as follows:
“7. Registration of certain establishments.-(1)
Every principal employer of an establishment to which this Act
applies shall, within such period as the appropriate
Government may, by notification in the Official Gazette, fix in
this behalf with respect to establishments generally or with
respect to any class of them, make an application to the
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registering officer in the prescribed manner for registration of
the establishment:
Provided that the registering officer may entertain any
such application for registration after expiry of the period fixed
in this behalf, if the registering officer is satisfied that the
applicant was prevented by sufficient cause from making the
application in time.
(2) If the application for registration is complete in all
respects, the registering officer shall register the
establishment and issue to the principal employer of the
establishment a certificate of registration containing such
particulars as may be prescribed.”
26. Section 9 of the CLRA Act, reads as follows:
“9. Effect of non-registration.-No principal employer
of an establishment, to which this Act applies, shall-
(a) in the case of an establishment required to be
registered under section 7, but which has not been
registered within the time fixed for the purpose under that
section,
(b) in the case of an establishment the registration in
respect of which has been revoked under section 8, employ
contract labour in the establishment after the expiry of the
period referred to in clause (a) or after the revocation of
registration referred to in clause (b), as the case may be.”
27. In the instant case, the Labour Court was faced
with a situation where the principal employer did not have
–
28
registration under Section 7 of the CLRA Act and the alleged
contractor did not have license at the relevant time. The
workmen had raised a specific contention that the contract
was a sham document and that they were as a matter of
fact being employed directly by the principal employer. After
considering the extensive documentary and oral evidence on
record, the Labour Court came to a conclusion that the
contract entered into was sham. The decisions in Dena
Nath’s case (supra), and Steel Authority of India Ltd’s
case (supra), would not, in our opinion, stand in the way of
the Labour Court entering into a factual finding in a dispute
raised by employees specifically on the question whether the
contract was a sham document. True, a Constitutional Court
may not be justified in finding that the employees are the
direct employees of the principal employer only because the
contractor did not have a license or the principal employer
did not have registration. But the Labour Court, after
appreciation of evidence, would be fully within its jurisdiction
in coming to such a conclusion on the basis of such
evidence.
–
29
28. The Apex Court in Dena Nath’s case (supra),
specifically held that in the absence of a notification
prohibiting contract labour under Section 10, it is not for the
High Court to issue directions deeming the contract labour
as direct employees. However, question has to necessity or
bona fides of employment of contract labour can be referred
to as an industrial dispute and the Labour Court/Industrial
Tribunal can give appropriate directions to the principal
employer.
29. The Labour Court has considered the issue and
has specifically found that the registration under Section 7 of
the CLRA Act was obtained by the establishment only on
21.04.1994. It was also found that the contractor did not
have due license under the CLRA Act. After taking note of
the evidence, the Labour Court came to the conclusion that
the workmen engaged for carrying out security duty could
only have been direct employees of the principal employer.
The direct supervision exercised by the principal employer
and the admissions made by the Management witnesses
were specifically considered by the Labour Court to come to
–
30
this conclusion. We notice that it is only in 1996 that the
first contract was entered into between the principal
employer, who had due registration under Section 7 of the
CLRA Act and a contractor who had due license under the
CLRA Act. Therefore, the contention of the appellant that
the contract labourers in question were not engaged in the
year 1989 and were engaged only in 1992 would make no
difference to the situation since in 1992 also, the specific
finding is that the contract, if any, was only a sham
document.
30. Though the learned senior counsel appearing for
the appellant attempted to draw our attention to the details
of the evidence led before the Labour Court, we are of the
opinion that re-appreciation of the evidence led before the
Labour Court would be impermissible by the learned Single
Judge exercising jurisdiction under Articles 226 and 227 of
the Constitution of India and indeed by us in an intra-Court
appeal in these proceedings. The contention that the Union
which espoused the cause of the workmen was not the
recognised Union of the establishment would also be of no
–
31
avail in a case, where the specific contention is that the
contract relied on by the Management is sham. In such
circumstances, it is clear that the workmen can themselves
raise the dispute. The contentions, if any, taken by the
workmen in an earlier suit would also not make any
difference to the situation since the Labour Court which is
the adjudicating authority empowered to decide an industrial
dispute considers and decides the dispute raised before it on
the basis of the evidence led by both sides.
31. It is trite law that an award of the Labour Court,
which is rendered after considering the evidence placed on
record is not liable to be lightly interfered with by the
Constitutional Court exercising the power of judicial review.
The Apex Court in the case of State of Andhra Pradesh
and Others v. S. Sree Rama Rao reported in 1963 SCC
OnLine SC 6, has held that, “It is not the function of the
High Court in a petition for a writ under Article 226 to review
the evidence and to arrive at an independent finding on the
evidence.” It is only when the findings arrived at by the
Labour Court are patently illegal, totally unreasonable or
–
32
perverse that the Constitutional Court would be justified in
interfering with such findings. It is also clear that what is
being exercised is not any power of appeal since no such
appeal is contemplated under the provisions of the statute.
32. We notice that the learned Single Judge has
considered the contentions of the appellant and has found
that the findings of the Labour Court cannot be said to be
perverse or unreasonable. On a consideration of the
contentions advanced and the materials on record, we are of
the opinion that the findings of the learned Single Judge do
not call for interference. The appeal fails and the same is
accordingly dismissed.
Pending IAs, if any, stand disposed of.
Sd/-
(ANU SIVARAMAN)
JUDGE
Sd/-
(UMESH M ADIGA)
JUDGE
cp*
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