Bombay High Court
Pandurang Punja Avhad vs Director The Automotive Research … on 10 March, 2025
2025:BHC-AS:11251
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
WRIT PETITION NO.12676 OF 2024
Pandurang Punja Avhad
Age 70 years,
Residing at - Devendra Niwas,
S-10/3, Sr. No.94/95, Indranagari,
Opp. Rahul Residency, Kothrud,
Pune - 411 038. ....Petitioner
V/S
Director,
The Automotive Research
Association of India,
Sr.No.102, Vetal Tekdi,
Aside of Karve Road,
Kothrud, Pune - 411 038. ....Respondent
_________
Mr. Nitin A. Kulkarni for the Petitioner.
Mr. Avinash Jalisatgi with Mr. Varun Joshi, Mr. Chetan Alai and
Ms. Divya Wadekar for Respondent.
__________
CORAM : SANDEEP V. MARNE, J.
RESERVED ON : 27 FEBRUARY 2025.
PRONOUNCED ON : 10 MARCH 2025.
JUDGMENT:
1) The pivotal issue that arises for consideration in the present
Petition is whether the Appropriate Government in respect of the
Respondent-Automotive Research Association of India (ARAI) is
Central or State Government. If it is held that the Appropriate
Government for Respondent-ARAI is the State Government, the next
issue for consideration is whether Petitioner fits into the definition of
a term ‘workman’ within the meaning of Section 2(s) of the Industrial
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Disputes Act, 1947 (ID Act). If the Petitioner is able to clear the two
hurdles, the Complaint filed by him challenging his termination can
be adjudicated on the merits.
2) The Petition arises out of challenge to the Award dated 15 May
2024 passed by the learned Presiding Officer, First Labour Court,
Pune, in Reference (IDA) No.328 of 2010 by which the Reference
relating to termination of Petitioner’s services with effect from
8 August 2005 is rejected.
3) Respondent-ARAI is a Society registered under the Societies
Registration Act, 1860 and is established with the objectives of
promoting research and other scientific work connected with design,
development, manufacture and operation of motor vehicles, internal
combustion engine, products of industries, etc. and to assist the
research work of associations or institutions, whose objects include
scientific and industrial research. Respondent-ARAI has been set up
by Indian vehicle and automotive auxiliary manufactures. Almost all
vehicle manufactures and major auxiliary manufactures are members
of Respondent-ARAI.
4) Petitioner joined the services of Respondent-ARAI as
Technical Assistant on 17 June 1980 on probation of one year. He was
absorbed in the regular service of Respondent-ARAI by order dated 23
June 1981. He was promoted to the post of Senior Technical Assistant
with effect from 1 January 1982. Thereafter he was further promoted
to the position as Project Engineer with effect from 1 March 1985.
Petitioner worked in the Vehicle Testing Department. He was further
promoted to the position of Senior Project Engineer.
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k 3/24 70 wp 12676.24 J as.doc 5) While working as Senior Project Engineer, a show-cause notice
dated 30 July 2005 was issued to the Petitioner alleging that he was
engaged in private business with his son and was accepting illegal
gratification from various Three-Wheeler Manufactures by assisting
them in getting clearance for their certification at Respondent-ARAI.
Petitioner replied the show- cause notice on 2 August 2005 and denied
the allegations. By letter dated 8 August 2005 Respondent-ARAI
terminated the services of the Petitioner with immediate effect by
crediting salary for three months in his account.
6) Aggrieved by his termination order, Petitioner was advised to
file Original Application No.548 of 2005 in Central Administrative
Tribunal, Mumbai challenging the termination order dated 8 August
2005. Respondent-ARAI filed Reply before the Tribunal contending
inter alia that Respondent-ARAI is neither Department of Central
Government nor is owned by the Central Government. That the
Central Government does not hold the entire share capital of
Respondent-ARAI nor exercises deep or persuasive control over the
functioning of Respondent-ARAI. It was contended that functions of
Respondent-ARAI are not closely related to the Government
functions. The Tribunal therefore proceeded to dismiss the Original
Application preferred by the Petitioner by order dated 27 November
2006 holding that it did not have jurisdiction to decide validity of
termination order issued by Respondent-ARAI.
7) Petitioner thereafter decided to exercise the remedies under the
Labour Laws. At the instance of the Petitioner, Reference was made
by Deputy Commissioner of Labour, Pune to First Labour Court,
Pune, which was registered as Reference (IDA) No.328 of 2010. The
Reference was with regard to termination of the Petitioner with effect
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from 8 August 2005 and for relief of reinstatement with continuity
and backwages. Petitioner filed his statement of claim before the
Labour Court, which was resisted by the Respondent-ARAI by filing
Written Statement. Parties led evidence in support of the respective
claims. By Award dated 15 May 2024, the Labour Court proceeded to
reject the Reference holding that the same to be not maintainable.
The Labour Court held that Appropriate Government for Respondent-
ARAI is the Central Government. The Labour Court also went into
the issue of status of the Petitioner as ‘workman’ under section 2(s) of
the ID Act and held that he does not fit into the definition of the term
‘workman’. This is how the Reference is rejected by the Labour Court
by Award dated 15 May 2024, which is subject matter of the challenge
in the present Petition.
8) Mr. Kulkarni, the learned counsel appearing for the Petitioner
would submit that the Labour Court has grossly erred in holding that
the Appropriate Government for Respondent-ARAI is Central
Government. He would submit that when Petitioner approached
Central Administrative Tribunal under impression that Respondent-
ARAI is autonomous body of the Central Government, the Original
Application was opposed contending that the Central Government
does not exercise deep or persuasive control over Respondent-ARAI.
After ensuring dismissal of Original Application filed before the
Central Administrative Tribunal, Respondent-ARAI could not have
contended before the Labour Court that the Appropriate Government
for it is Central Government. He would rely upon judgment of
Division Bench of this Court in Nandkumar Nivrutti Baptiwale vs.
Automotive Research Association of India and others. 1 in
support of his contention that the Respondent-ARAI is held to be not
1 2002 (2) Mh.L.J. 191
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an authority, agency or instrumentality of the State. He would also
rely upon judgment of the Apex Court in Kishor Madhukar
Pinglikar vs. Automotive Research Association of India 2 in
support of his contention that Respondent-ARAI performs several
other functions in addition to certification of vehicles, which activity is
done by several other institutes across the country. He would rely
upon judgment of this Court in Tata Memorial Centre and others
vs. Tata Memorial Hospital Workers Union Tata Memorial
Hospital and another3 in support of the contention that the
expression ‘under the control’ would connote absolute control by the
Central Government. He would submit that far from absolute control,
the Central Government does not even exercise deep or persuasive
control over Respondent-ARAI as per defence adopted by Respondent-
ARAI before the CAT.
9) Mr. Kulkarni would thereafter submit that the Labour Court
has erred in holding that the Petitioner is not a ‘workman’ within the
meaning of Section 2(s) of the ID Act. He would submit that the
predominant nature of duties and responsibilities of the Petitioner are
technical and skilled in nature. That though his designations have
changed from Technical Assistant Engineer to Senior Project
Engineer, ultimately there has been no change in his duties and
responsibilities. That merely because Petitioner recommended leave of
few employees, the same did not make him their supervisor in
absence of authority to sanction the leave. He would rely upon
judgment of this Court in Jayhind Vithoba Mahadik vs. General
Manager, Maharashtra Scooters, Ltd.4 in support of his
contention that even if the workman is found to have sanctioned leave,
2 2022 SCC OnLine SC 1799
3 2024 SCC OnLine Bom. 869
4 2004 (4) LLN 429
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the same does not ipso facto make him a supervisor. He would submit
that the Petitioner discharged the burden of proving that he is a
workman. That in any case, if dispute is created about status by
Respondent-ARAI, the burden shifted on it to prove that Petitioner is
the Supervisor or Manager. In support he would rely upon judgment
of Division Bench of this Court in Waman Ganpat Raut vs.
Cadbury-Fry (India) (Private), Ltd. and Anr. 5 He would further
submit that since no enquiry is admittedly conducted into alleged
misconduct, reinstatement with full backwages is a natural corollary
after upholding maintainability of the Reference. He would
accordingly pray for reinstatement of the Petitioner with full
backwages. He would accordingly pray for setting aside the impugned
award.
10) The Petition is opposed by Mr. Jalisatgi, the learned counsel
appearing for Respondent-ARAI. He would submit that Respondent-
ARAI carries on industry under the authority of Central Government
and that therefore the appropriate Government for it is the Central
Government. That Respondent-ARAI directly comes under the control
of Ministry of Heavy Industries of Government and therefore State
Government could not have ordered Reference relating to termination
of the Petitioner. He would submit that though Respondent-ARAI is
not an Instrumentality of State within the meaning of Article 12 of
the Constitution of India, the same would not ipso facto mean that it
is not an industry under the control of the Government of India. That
the concept of being a State under Article 12 of the Constitution of
India is entirely different and distinct from the concept of an industry
under the control of Government of India. That therefore the
judgment of this Court in Nandkumar Nivrutti Baptiwale (supra)
5 1980 (1) LLN 488
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or of the Apex Court in Kishor Madhukar Pinglikar (supra) are
totally irrelevant for the purpose of deciding the issue of Appropriate
Government. He would rely upon judgment of the Apex Court in Steel
Authority of India Ltd. and others vs. National Union
Waterfront Workers and others6 in support of his contention that
the test is whether the industry is carried on by virtue of conferment
of power or permission by the Central Government and not whether
the undertaking concerned falls within the meaning of ‘State’ under
Article 12 of the Constitution of India. He would therefore submit that
the finding recorded by the Labour Court about Appropriate
Government in respect of the Respondent-ARAI being Central
Government does not warrant any interference.
11) So far as the issue of status of Petitioner as workman is
concerned, Mr. Jalisatgi would submit that Petitioner was working on
the post of Senior Project Engineer in supervisory and managerial
capacity and cannot brand himself as ordinary workman. That he was
deputed to foreign countries for acquiring training. That he used to
recommend leave of employees posted in his Section meaning thereby
that he used to take a decision relating to manpower availability in
his own Section. That he has approved tour programs of employees
working in his Section. That therefore it cannot be contended that he
was performing skilled, manual or technical job. That the
predominant nature of his duties was supervisory and managerial.
He would submit that the entire burden of proving skilled, manual or
technical work vested entirely on the shoulders of the Petitioner,
which he failed to discharge. He would rely upon judgment of this
Court in Shrikant Vishnu Palwankar vs. Presiding Officer of
First Labour Court7 in support of his contention that
6 (2001) 7 SCC 1
7 1991 Mh.L.J. 1565
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recommendation of leave is one index of supervisory functioning. He
would submit that the doctrine of res ipsa loquitur would apply to the
present case where the burden would be on Petitioner to prove that he
was performing skilled, manual or technical nature of duties. In
support of said submissions he would rely upon judgment of the Apex
Court in Sonepat Cooperative Sugar Mills Ltd. vs. Ajit Singh 8.
Lastly, Mr. Jalisatgi would rely upon judgment of this Court in
Standard Chartered Bank vs. Vandana Joshi and another 9 in
support of his contention that power to sanction leave or initiate
disciplinary proceedings is an indicator of supervisory and
managerial nature of duties. He would therefore submit that the
Labour Court has rightly held that the Petitioner does not fit into the
definition of the term ‘workman’. He would accordingly pray for
dismissal of the Petition.
12) Rival contentions of the parties now fall for my consideration.
13) The fist issue to be decided is whether the Appropriate
Government in respect of Respondent-ARAI is Central or State
Government. The term ‘Appropriate Government’ has been defined
under Section 2(a) of the ID Act as under:
(a) “Appropriate Government” means–
(i) In relation to any industrial dispute concerning any industry
carried on by or under the authority of the Central Government, or
by a Railway Company (or concerning any such controlled industry
as may be specified in this behalf by the Central Government) or in
relation to an industrial dispute concerning (a Dock Labour Board
established under Section 5-A of the Dock Workers (Regulation of
Employment) Act, 1948 (9 of 1948), or [the Industrial Finance
Corporation of India Limited formed and registered under the
Companies Act, 1956 (1 of 1956)], or the Employees’ State Insurance
8 (2005) 3 SCC 232
9 2010 (2) Mh.L.J. 22
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Corporation established under Section 3 of the Employees’ State
Insurance Act, 1948 (34 of 1948), or the Board of Trustees
constituted under Section 3-A of the Coal Mines Provident Fund and
Miscellaneous Provisions Act, 1948 (46 of 1948), or the Central
Board of Trustees and the State Boards of Trustees constituted
under Sections 5-A and 5-B, respectively, of the Employees’
Provident Fund and Miscellaneous Provisions Act, 1952 (19 of 1952),
or the Life Insurance Corporation of India established under Section
3 of the Life Insurance Corporation Act, 1956 (31 of 1956), or [the
Oil and Natural Gas Corporation Limited registered under the
Companies Act, 1956 (1 of 1956)], or the Deposit Insurance and
Credit Guarantee Corporation established under Section 3 of the
Deposit Insurance and Credit Guarantee Corporation Act, 1961 (47
of 1961), or the Central Warehousing Corporation established under
Section 3 of the Warehousing Corporations Act, 1962 (58 of 1962), or
the Unit Trust of India established under Section 3 of the Unit
Trust of India Act, 1963 (52 of 1963), or the Food Corporation of
India established under Section 3 or a Board of Management
established for two or more contiguous States under Section 16 of
the Food Corporations Act, 1964 (37 of 1964), or [the Airports
Authority of India constituted under Section 3 of the Airports
Authority of India Act, 1994 (55 of 1994)], or a Regional Rural Bank
established under Section 3 of the Regional Rural Banks Act, 1976
(21 of 1976), or the Export Credit and Guarantee Corporation
Limited or the Industrial Reconstruction Bank of India [the
National Housing Bank established under Section 3 of the National
Housing Bank Act, 1987 (53 of 1987)], or (an air transport service,
or a banking or an insurance Company), (a mine, an oilfield), (a
Cantonment Board), or a (major port, the Central Government), and
(ii) in relation to any other industrial dispute, the State
Government.
14) Thus, in relation to any industrial dispute concerning any
industry carried ‘by or under the authority of Central Government’,
the appropriate Government is Central Government. The definition of
the term ‘Appropriate Government’ underwent a major change by the
Amendment Act 2010, under which a Company in which Central
Government holding 51% paid-up share capital or a Corporation
established by or under law made by the Parliament or Central Public
Sector Undertaking and autonomous bodies owned or controlled by
the Central Government, the Appropriate Government is now the
Central Government. The Amendment of 2010 assumes importance
as the legislature realised that an industry carried on by or under the
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Authority of the Central Government was excluding most of the
public sector undertakings from the ambit of section 2(a)(i) of the ID
Act. In Tata Memorial Hospital Workers Union (supra) 3-Judge
Bench of the Apex Court held on the basis of unamended definition of
the term ‘Appropriate Government’ that the industry or undertaking
has to be carried out under the authority of the Central Government
and mere control of the Government, ownership of paid-up share
capital etc. was not sufficient for holding Central Government to be
the ‘appropriate Government’. The Apex Court held in paragraphs 29,
30, 59, 60 and 63 as under:
29. It was accepted by the corporation that it could not be said to be an
“industry” carried on by the Central Government. The limited issue was
whether it could be regarded as an “industry”, carried on under the
authority of the Central Government. The question was as to how to
construe the phrase “under the authority of the Central Government”. This
Court held: (Heavy Engg. Mazdoor Union case [(1969) 1 SCC 765 : (1969) 3
SCR 995] , SCC pp. 768-69, para 4)
“4. … There being nothing in Section 2(a) to the contrary, the word
‘authority’ must be construed according to its ordinary meaning
and therefore must mean a legal power given by one person to
another to do an act. A person is said to be authorised or to have an
authority when he is in such a position that he can act in a certain
manner without incurring liability, to which he would be exposed
but for the authority, or, so as to produce the same effect as if the
person granting the authority had for himself done the act. For
instance, if A authorises B to sell certain goods for and on his behalf
and B does so, B incurs no liability for so doing in respect of such
goods and confers a good title on the purchaser. There clearly arises
in such a case the relationship of a principal and an agent. The
words ‘under the authority of’ mean pursuant to the authority, such
as where an agent or a servant acts under or pursuant to the
authority of his principal or master. Can the respondent Company,
therefore, be said to be carrying on its business pursuant to the
authority of the Central Government? That obviously cannot be
said of a company incorporated under the Companies Act whose
constitution, powers and functions are provided for and regulated
by its memorandum of association and the articles of association.”
(emphasis supplied)
30. This Court noted in Heavy Engg. Mazdoor Union case [(1969) 1 SCC
765 : (1969) 3 SCR 995] that an incorporated company has a separate
existence and the law recognises it as a juristic person, separate and
distinct from its members. Its rights and obligations are different from
those of its shareholders. Action taken against it does not directly affect its
shareholders. The company so incorporated derives its powers and
functions from and by virtue of its memorandum of association and its
articles of association. The mere fact that the entire share capital of the
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company was contributed by the Central Government and the fact that all
its shares are held by the President and certain officers of the Central
Government does not make any difference. The Court noted that a notice to
the President of India and the officers of the Central Government, who hold
between them all the shares of the company would not be a notice to the
company nor can a suit maintainable by and in the name of the company be
sustained by or in the name of the President and the said officers.
59. As far as an industry “carried on by the Central Government” is
concerned, there need not be much controversy inasmuch as it would mean
the industries such as the Railways or the Posts and Telegraphs, which are
carried on departmentally by the Central Government itself. The difficulty
arises while deciding the industry which is carried on, not by but “under
the authority of the Central Government”. Now, as has been noted above, in
the Constitution Bench judgment in SAIL [(2001) 7 SCC 1 : 2001 SCC
(L&S) 1121] , the approach of the different Benches in the four earlier
judgments has been specifically approved and the view expressed in Air
India [(1997) 9 SCC 377 : 1997 SCC (L&S) 1344] has been disagreed with.
The phrase “under the authority” has been interpreted in Heavy
Engg. [(1969) 1 SCC 765 : (1969) 3 SCR 995] to mean “pursuant to
the authority” such as where an agent or servant acts under
authority of his principal or master. That obviously cannot be said
of a company incorporated under the Companies Act, as laid down
in Heavy Engg. Mazdoor Union case [(1969) 1 SCC 765 : (1969) 3 SCR
995]. However, where a statute setting up a corporation so provides
specifically, it can easily be identified as an agent of the State.
60. The judgment in Heavy Engg. Mazdoor Union [(1969) 1 SCC 765 :
(1969) 3 SCR 995] observed that the inference that a corporation was an
agent of the Government might also be drawn where it was performing in
substance governmental and non-commercial functions. The Constitution
Bench in SAIL case [(2001) 7 SCC 1 : 2001 SCC (L&S) 1121] has disagreed
with this view in para 41 of its judgment. Hence, even a corporation which
is carrying on commercial activities can also be an agent of the State in a
given situation. Heavy Engg. [(1969) 1 SCC 765 : (1969) 3 SCR 995]
judgment is otherwise completely approved, wherein it is made
clear that the fact that Minister appoints the members or Directors
of corporation and he is entitled to call for information, to give
directions regarding functioning which are binding on the
Directors and to supervise over the conduct of the business of the
corporation does not render the corporation an agent of the
Government. The fact that entire capital is contributed by the
Central Government and wages and salaries are determined by it,
was also held to be not relevant.
63. The propositions in SAIL [(2001) 7 SCC 1 : 2001 SCC (L&S) 1121] are
to be seen on this background viz. that merely because the government
companies/corporations and societies are discharging public functions and
duties that does not by itself make them agents of the Central or the State
Government. The industry or undertaking has to be carried under the
authority of the Central Government or the State Government. That
authority may be conferred either by a statute or by virtue of a relationship
of principal and agent, or delegation of power. When it comes to conferring
power by statute, there is not much difficulty. However, where it is not so,
and whether the undertaking is functioning under authority is a question
of fact. It is to be decided on the facts and circumstances of each case.
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k 12/24 70 wp 12676.24 J as.doc 15) Applying the tests determined by the Apex Court to the
establishment of Tata Memorial Centre, the Apex Court held that
though the Central Government had power to appoint its nominees on
Governing Council of the Tata Memorial Centre, which was
controlling entire administration and management, the Apex Court
held that the Tata Memorial Centre was not “under the control” of the
Central Government. Shortly after rendering of judgment of the Apex
Court in Tata Memorial Hospital Workers Union on 10 February
2009 definition of the term ‘Appropriate Government’ under section
2(1)(a) underwent a change with effect from 15 September 2010 and
all autonomous bodies owned and controlled by the Central
Government came to be included under Section 2(1)(a) of the ID Act.
16) Though Mr. Jalisatgi has relied upon judgment of the Apex
Court in Steel Authority of India Ltd. (supra), which is considered
in Tata Memorial Hospital Workers Union (supra), in my view, it
is not really necessary to delve deeper into the differentiation between
the concept of being a State under Article 12 of the Constitution of
India and an industry carrying out under the authority of the Central
Government. In my view, the answer to the issue of the exact
Government which would be appropriate Government can be found in
the judgment of the Apex Court rendered in the case of Respondent-
ARAI itself in Kishor Madhukar Pinglikar (supra). Though it is
sought to be urged before me that Respondent-ARAI carries on
industry under the authority of the Central Government, the Apex
Court has held in Kishor Madhukar Pinglikar that certification of
vehicles under the Motor Vehicle Act, is not the only function
performed by Respondent-ARAI and that it carries on various other
functions under the Memorandum of Association. The Apex Court
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held in Kishor Madhukar Pinglikar (supra) in paragraphs 21 and
24 as under:
21. Learned counsel for the appellant, however, had relied upon Rule
126 of the Central Motor Vehicles Rules, 1989, which requires that
every manufacturer or importer of the motor vehicle shall submit
the prototype of the vehicle to be manufactured or imported by him
to specified Associations/Authorities for issuance and grant of
certificate by that agency for compliance of the provisions of the
Motor Vehicle Act and Rules. In our opinion, the High Court rightly
observed that the aforesaid task has been performed by a large
number of agencies and the Central Government is entitled to take
help and avail services of these specialized agencies/associations.
The respondent Association and other agencies must undertake the
test in accordance with the procedure laid down by the Central
Government. It is pointed out that the certificates issued by the
respondent Association are recommendatory in nature. The
aforesaid function performed by the respondent has to be read along
with the other functions which the respondent Association is obliged
to perform as per the Memorandum of Association, which we have
referred to briefly.
24. In light of the law as accentuated and facts as presented, it is
clear that the respondent Association is not an agency or
instrumentality of the Government. Further, the Government does
not have deep and pervasive control over it. The writ petition was
rightly not entertained.
17) In my view, the above finding recorded in Kishor Madhukar
Pinglikar (supra) squarely answers the issue with regard to the
‘Appropriate Government’. Once it is held that several other functions
of Respondent-ARAI are not conducted under the authority of the
Central Government, it cannot be contended that the ‘appropriate
Government’ for Respondent-ARAI would be Central Government.
Therefore, mere act of certification of vehicles under provisions of
Rules 126 and 126A of the Central Motor Vehicles Rules, 1989 (the
Rules), which is one of the several activities of Respondent-ARAI, it
cannot be contended that it carries on industry under the authority of
the Central Government.
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k 14/24 70 wp 12676.24 J as.doc 18) This Court otherwise does not appreciate the changing stands
taken by Respondent-ARAI. Right since the judgment of Division
Bench in Nandkumar Nivrutti Baptiwale (decided on 11 January
2002) Respondent-ARAI is emphatic in contending that it is not a
State within the meaning of Article 12 of the Constitution of India. In
Nandkumar Nivrutti Baptiwale (supra) Division Bench of this
Court held, after considering provisions of Rule 126 of the Rules,
1989, that mere authority conferred upon Respondent-ARAI to carry
out test under Rules 126 and 126A of the Rules would not confer the
status of authority or instrumentality or agency of State to the
Association. The relevant finding recorded by the Division Bench in
paragraph 15 reads thus:
15. What is provided under Rules 126 and 126-A of the aforesaid rules is
that prototype of every motor vehicle shall be subject to the test which may
be carried out by various agencies including the first respondent
Association. We are afraid by providing that the respondent Association is
recognised body to carry out the test under rules 126 and 126-A and that it
is approved by Government for certification of roadworthyness, fuel
efficiency test shall not confer the status of authority or instrumentality or
agency of the State to the Association. Mr. Bukhari, learned counsel for the
petitioner relied upon the judgments of the Apex Court in Ajay
Hasia v. Khalid Mujib Sehravardi and ors. 1981 (1) LLJ 103, B.S.
Minhas v. Indian Statistical Institute and ors. 1984 LIC 15 and P.K.
Ramchandra Iyer v. Union of India, 1984 LIC 301. In Ajay Hasia, the Apex
Court based on the judgment in International Airport Authority culled out
the following tests:–
“(1) ‘One thing is clear that if the entire share capital of the
corporation is held by Government it would go a long way towards
indicating that the corporation is an instrumentality or agency of
Government.’
(2) ‘Where the financial assistance of the State is so much as to meet
almost entire expenditure of the corporation, it would afford some
indication of the corporation being impregnated with governmental
character.’
(3) ‘It may also be a relevant factor….. whether the corporation
enjoys monopoly status which is the State conferred or State
protected.’
(4) ‘Existence of deep and pervasive State control may afford an
indication that the Corporation is a State agency or instrumentality.’katkam Page No. 14 of 24
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k 15/24 70 wp 12676.24 J as.doc(5) ‘If the functions of the corporation of public importance and
closely related to governmental functions it would be a relevant
factor in classifying the corporation on an instrumentality or agency
of Government.’
(6) ‘Specifically, if a department of Government is transferred to a
corporation, it would be a strong factor supportive of this inference
of the corporation being an instrumentality or agency of
Government.'”
19) In Kishor Madhukar Pinglikar (supra) also Respondent-
ARAI maintained its defence that the Central Government does not
exercise deep or persuasive control over it. Thus, when employees of
Respondent-ARAI sought to invoke jurisdiction of this Court for
challenging punitive actions meted out to them, Respondent-ARAI
defended the same contending that it is not an instrumentality of
State. However, in the present case where Petitioner’s Reference was
made by the State Government, it has altered its position by
contending that it carries on industry under the authority of the
Central Government. While this Court appreciates the difference
between the concept of carrying on industry under the authority of
Central Government and a particular entity being a State within the
meaning of Article 12 of the Constitution of India, this Court does not
appreciate the changing stands adopted by Respondent-ARAI to suit
its convenience to defeat jurisdiction of every possible Court its
employees seek to approach relating to their service grievances.
20) In fact, the rigour of test of industry being carried out ‘under
the authority of Central Government’ is stricter than the test of being
an autonomous body of the Central Government. An autonomous
body enjoys some degree of autonomy in performance of its functions
even though the Central Government may exercise deep and
persuasive control over it. On the other hand if an industry is carried
out under the authority of the Central Government, there would be
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complete control of the Central Government on activities performed
by the establishment. It cannot be that the ARAI would escape from
being treated as an autonomous body of the Central Government, but
would continue to be an industry carried out under the authority of
Central Government.
21) In my view therefore, Respondent-ARAI is not an industry
carried on by or under the authority of the Central Government. It is
just an association formed by Indian Vehicles Manufacturers. It
performs various functions other than certification of vehicles and all
its functions are not carried out under the authority of the Central
Government. The Central Government has not authorized
Respondent-ARAI to carry out each and every function that it
undertakes. Certification of vehicles under Rules 126 and 126A of the
Rules is just small part of activities of Respondent-ARAI. It therefore
cannot be contended, by any stretch of imagination, that every activity
conducted by Respondent-ARAI is under authority of the Central
Government. The Labour Court, in my view, has grossly erred in
holding that the Appropriate Government for Respondent-ARAI is
Central Government. The Assistant Labour Commissioner of the
State Government rightly made a Reference relating to termination of
the Petitioner to the Labour Court. The Reference was thus perfectly
maintainable as it did not suffer from any inherent error of
jurisdiction.
22) Coming to the issue of status of the Petitioner, it appears that
his designation at the time of termination was Senior Project
Engineer. His services are terminated without holding enquiry by
levelling allegations against him in the show-cause notice. The issue
however is whether Petitioner could have invoked jurisdiction of
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Labour Court in view of his status as Senior Project Engineer. By now
it is well settled position of law that mere designation of a person is
not indicative of the exact nature of duties and responsibilities
discharged by him/her. Therefore, I am not going by mere designation
of the Petitioner as Senior Project Engineer at the time of his
termination. However, there are several factors which seek to indicate
that the predominant nature of his duties and responsibilities were
either supervisory or managerial. Respondent-ARAI has placed on
record copies of several leave applications of employees working in the
Section of the Petitioner. The leave application contains heading
under clause 10 ‘Recommendation of the Department/Section Head”
and Petitioner has signed against the said column, meaning thereby
that Petitioner was the Section Head. True it is that a different
authority has ultimately sanctioned the leave. The Petitioner has
however taken part in recommending the leave to the higher official.
Mr. Jalisatgi is right in contending that by recommending the leave
Petitioner actually used to take decision about management of the
staff in his own Section.
23) Respondent-ARAI has placed on record tour programs of the
several employees sanctioned by the Petitioner in his capacity as
Senior Project Engineer. This again indicates that he was performing
supervisory functions by sanctioning the tour programs of other
employees. To make the case of Petitioner worse, Respondent-ARAI
relied upon copy of the tour program of the Petitioner by which he was
deputed at Datron-Messtechnik and Pierburg Messtechnik in West
Germany during 2 September 1989 to 27 September 1989. Surely an
ordinary workman would not be deputed by the employer in the year
1989 for training in Germany. During late eighties, foreign tour was
something which was beyond the reach of ordinary Indians. Unlesskatkam Page No. 17 of 24
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k 18/24 70 wp 12676.24 J as.docPetitioner was a senior official in Respondent-ARAI, he would not
have been deputed for training in a foreign country.
24) It appears that further promotion of the Petitioner from the
position as Senior Project Engineer was to the position of Assistant
Director. He pleaded in paragraph 2.3 of his Statement of Claim that
he was invited for interview for position as Assistant Director on 30
July 2005, but was not selected. The Petitioner was thus working on a
position immediately below the position of Assistant Director. It
surely cannot be contended that such a senior level official would be
offered to an ordinary workman performing predominantly manual,
unskilled, skilled, technical, operational or clerical work. After his
employment in Respondent-ARAI, he climbed the ladder of several
promotions. He was initially appointed as Technical Assistant and got
three further promotions to the post of Senior Technical Assistant,
Project Engineer and finally Senior Project Engineer.
25) It is sought to be contended by Mr. Kulkarni that clause 4 of
appointment order of Petitioner stipulated that the Standing Orders
of Respondent-ARAI would govern the Petitioner. However, the said
terms and conditions related to initial appointment of Petitioner as
Technical Assistant effected on 17 June 1980. He thereafter earned
three promotions as Senior Technical Assistant, Project Engineer and
Senior Project Engineer. In fact, the office order dated 17 June 1980
contained a stipulation that “he will report to Mr. S Raju, Senior
Project Engineer for necessary instructions”. This shows that position
of Senior Project Engineer was supervisory post to all Technical
Assistants. There was meteoric rise in his pay. The pay-scale of
Technical Assistants was Rs. 425-700/- whereas the pay-scale of
Project Engineer (one position below the position of Senior Projectkatkam Page No. 18 of 24
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k 19/24 70 wp 12676.24 J as.docEngineer) was Rs. 700-1300/-. Petitioner admitted in his cross-
examination that he was drawing salary of Rs. 30,000/- at the time of
his dismissal on 8 June 2005. Considering the salary structure
prevalent in India in the year 2005, it becomes difficult to believe that
ordinary workman drew salary of Rs. 30,269/-.
26) So far as duties and responsibilities are concerned, Petitioner
stated in paragraph 5 of Affidavit of evidence that his duties involved
repairs of instruments, testing of vehicles, generator centres and
components, operation of instruments together with other workers in
the workshop. On the other hand, the witness of the employer led
evidence that the nature of duties performed by him were
coordination of genset testing, instrumentation maintenance, upkeep
of lab equipment and supervising day to day lab activities.
27) Considering the above evidence, it becomes difficult to believe
that the Petitioner discharged the burden of proving that
predominant nature of his duties involved skilled and technical work
and he did not work in managerial and supervisory capacity. He did
not examine any co-worker to prove that he used to work like an
ordinary workman in workshop. He did not explain as to how he was
recommending leave of other employees or sanctioning tour program
of other employees. The signature of the Petitioner appears in the tour
program as “team leader”. There is no explanation from the Petitioner
as to how an ordinary workman could be deputed for training to
Germany. It is not Petitioner’s case that other workmen were also
deputed for training to Germany. I am therefore of the view that
Petitioner failed to discharge the burden of proving that he was
workman within the meaning of Section 2(s) of the I.D. Act.
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k 20/24 70 wp 12676.24 J as.doc 28) After considering the cumulative effect of above factors where
Petitioner was found to be i) recommended leaves, ii) sanctioned tour
programs of other employees, iii) deputed for training in foreign
country, iv) appeared for interview on position as Assistant Director,
v) received three promotions and vi) held the position of Senior Project
Engineer, it becomes difficult to hold that the predominant duties and
responsibilities performed by him were manual, unskilled, skilled,
technical, operational or clerical in nature. He was undoubtedly
employed in managerial capacity and in any case in a supervisory
capacity drawing wages exceeding Rs.10,000/-. In my view therefore,
no serious error can be traced in the view taken by the Labour Court
that Petitioner cannot be considered as workman within the meaning
of Section 2(s) of the ID Act.
29) It would be apposite to refer to some of the judgments relied
upon by Mr. Jalisatgi. In Standard Chartered Bank (supra) it was
sought to be contended that absence of power to sanction leave or
initiate disciplinary proceedings would be sufficient to uphold status
of person as workman. A Coordinate Bench of this Court (Dr. D.Y.
Chandrachud, J. as he then was) disagreed and held in paragraph 14
as under:
14. During the course of her submissions, the first respondent
sought to place reliance on the cross-examination of the two
witnesses who deposed on behalf of the bank. MW 1, during the
course of her cross-examination admitted that the first respondent
did not sanction leave and that she was not aware as to whether the
first respondent could initiate proceedings against an employee of
the bank. The Tribunal has during the course of its award placed a
great deal of emphasis on the fact that the first respondent could
also not recommend leave nor could she initiate disciplinary action
against other employees. The fact that an employee is not vested
with the power to sanction leave or to initiate disciplinary
proceedings is not conclusive of the question as to whether the work
that is performed by the employee falls within one of the categories
stipulated in section 2(s). Whether leave can be sanctioned andkatkam Page No. 20 of 24
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k 21/24 70 wp 12676.24 J as.docwhether disciplinary proceedings can be initiated may in a given
case be one of the circumstances which may be considered in the
balance. The balance, however, has to be drawn on the basis of the
overall nature of the duties and responsibilities performed and the
dominant nature of the work that is performed by an employee.
Virtual offices are now a reality and paperless transactions are no
longer a novelty. Managerial organisation today is radically different
from the pre-liberalization era. Tests of control which were
appropriate to a society thirty years ago have become relics of an era
which India has left behind in the annals of history. The law has
kept pace with the times by recognizing that in order to determine
whether a person is a workman under section 2(s), contemporary
notions of business cannot be stratified by notions of economic
organisation developed for an era which is no more.
30) In Shrikant Vishnu Palwankar (supra) Coordinate Bench of
this Court (B.N. Srikrishna, J., as he then was) held that
recommendation of leave is one index of supervisory function. This
Court held in paragraph 8 as under:
8. Mrs. Menon then contended that recommending of leave was not
indicative of supervisory duty as the evidence nowhere showed that
the Petitioner was empowered to grant leave. In my view, this
contention is misconvceived. When a person is working as a
Supervisor, he is required to oversee the working of the Department.
Since he is put incharge of the outturn of the Department, he has to
efficiently manage the men, machines and material under his
control. For this purpose, he alone is the best judge as to which
person is to be spared at any given time. It is for this reason that the
supervisor, who is on the spot, is expected to make a
recommendation as to whether leave could be granted to any
workman working in his Department. It is precisely for this reason
that the authority competent to grant leave seeks his
recommendation and does not pass an order without his
recommendation. In my view, recommendation of leave is one index
of supervisory function.
31) Though Mr. Kulkarni has relied upon judgment of another
Coordinate Bench of this Court (Nishita Mhatre, J.) in Jayhind
Vithoba Mahadik (supra), judgment does not assist the case of the
Petitioner. It is held in the said judgment in paragraph 8 as under:
8. Documents which were filed before the Labour Court have been
produced before me to indicate that the petitioner was not akatkam Page No. 21 of 24
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through this documentary evidence and I do not find that it clearly
establishes the fact that the petitioner was not a workman. Reliance
placed on certain documents which indicate that the petitioner was
appraising the performance of the watchmen, would not mean that
he was an officer. This was only part of a job that he was required to
do. Moreover, appraisal was not confined only to petitioner’s report
but he was required to be appraised by other higher authorities.
Although leave could have been sanctioned by the petitioner to the
watchman concerned and their roster made by him, this would not
in my view indicate that the petitioner was not a workman. In any
event, it is trite law that nomenclature does not in any manner
establish the status of the person working in an establishment. The
nature of the work that the person performs is required to be
considered. The duties which the person is expected to carry out has
also to be considered. The learned advocate for the petitioner has
rightly placed reliance on the judgments which were similar to the
case before me.
32) The judgment in Jayhind Vithoba Mahadik (supra) in my
view cannot be cited in support of an absolute proposition of law that
every person clothed with power to sanction leave would still be
covered by definition of the term ‘workman’. In the present case,
power to recommend leave being vested in the Petitioner is just an
additional factor and combination of various factors discussed above,
makes it difficult to believe that he is a workman within the meaning
of Section 2(s) of the ID Act.
33) Both the sides have relied upon judgments in support of their
respective contentions on the issue of burden of proof. Mr. Kulkarni
has relied upon old judgment of Division Bench of this Court in
Waman Ganpat Raut (supra) in which it is held that once the
employer raises an objection to the maintainability of the Reference, it
is for the employer to make good the said objection. However by now it
is well settled position of law that the burden of proving status as a
workman is on a person who claims the same. Reference in this
regard can be made to the recent judgment of the Apex Court in
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Lenin Kumar Ray vs. Express Publications (Madurai) Ltd. 10 in
paragraph 15 as under:
15. The law is well settled that the determinative factor for
“workman” covered under section 2(s) of the I.D. Act, is the principal
duties and functions performed by an employee in the establishment
and not merely the designation of his post. Further, the onus of
proving the nature of employment rests on the person claiming to be
a “workman” within the definition of section 2(s) of the I.D. Act.
34) Thus, the burden of proving the status of workman was on the
Petitioner which he has failed to discharge the same. On the contrary
various factors as discussed above would clearly indicate the
employment of the Petitioner was in managerial or supervisory
capacity.
35) Consequently, the Petition can succeed only partly to the
extent of issue of Appropriate Government in respect of the
Respondent-ARAI being State Government. However, it would fail on
the issue of status of the Petitioner as ‘workman’.
36) I accordingly proceed to pass the following order:
i) The finding recorded by the Labour Court that
Appropriate Government for Respondent-ARAI is the Central
Government is set aside.
ii) It is declared that Appropriate Government for
Respondent-ARAI is the State Government.
iii) The finding recorded by the Labour Court that Petitioner
is not a ‘workman’ within the meaning of Section 2(s) of the ID
Act is upheld.
10 2024 SCC OnLine SC 2987 katkam Page No. 23 of 24 ::: Uploaded on - 11/03/2025 ::: Downloaded on - 11/03/2025 21:59:14 ::: k 24/24 70 wp 12676.24 J as.doc iv) Consequently, though finding of the Labour Court on the
issue of Appropriate Government is set aside, the ultimate
order rejecting the Reference will have to be upheld and is
accordingly upheld.
v) The amount deposited in this Court by the Respondent is
permitted to be withdrawn by the Petitioner alongwith accrued
interest.
37) Writ Petition is accordingly dismissed. There shall be no order
as to costs.
(SANDEEP V. MARNE, J.)
Digitally
signed by
SUDARSHAN
SUDARSHAN RAJALINGAM
RAJALINGAM KATKAM
KATKAM Date:
2025.03.11
10:28:03
+0530katkam Page No. 24 of 24
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