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CASE NO.: Appeal (civil)  1587 of 2005

PETITIONER: Canteen Mazdoor Sabha

RESPONDENT: Metallurgical Engg. Consultants (I) Ltd. & Ors

DATE OF JUDGMENT: 21/08/2007

BENCH: A.K.MATHUR & MARKANDEY KATJU

JUDGMENT: J U D G M E N T  

CIVIL APPEAL NO. 1587  OF 2005   

A.K. MATHUR, J.

1.              This Appeal is directed against the order passed by the  High Court of Jharkhand at Ranchi in Letters Patent Appeal No.  382/1997 whereby  the Division Bench by order dated 23rd  December, 2003 set aside the order passed by the learned  Single  Judge  as well as the Award of the Industrial Tribunal holding that  the  workers of the canteen of  Metallurigical and Engineering Consultant  (India)  Ltd. (hereinafter referred to as the Mecon)  run by  Mecon  Welfare Committee be treated at par with the employees   working in  the VIP Guest House and Tea Club of Mecon and  granting them all  the benefits  given to those employees and to treat them as  employees of Mecon.  The writ petition was filed  by the  Canteen  Mazdoor Sabha  in the Apex Court and this Court by order dated  23rd  February, 1987  directed  to list  the matter after the judgment was  pronounced in writ petition Nos. 12143-12214 of 1984.  On  19.10.1992, the writ petition  came up for  final disposal and it was  stated in the order that the parties agreed that a joint reference under  Section 10(2) of the Industrial Disputes Act, 1947 (hereinafter   referred to as the Act) be made to the Industrial Tribunal for   adjudication of the disputes between Sabha and Mecon.  Following  are disputes set out in  the order :                  "1. Whether the employees of canteen engaged and  employed by MECON Welfare Committee consisting of  the representatives of MECON (Non-executive)  Employees’ Union, MECON Executive Association and  nominees of MECON are entitled to the same service  conditions as are applicable to the  employees of the VIP  Guest House and of the Tea Club who are employed and  engaged by MECON?

       2. If so, from what date?

       3. In view of the nature of work performed by the Canteen  employees engaged and employed by MECON Welfare  Committee, are they justified in law in asking for parity  with the employees of MECON working in the VIP Guest  House and the Tea Club keeping in view that the total  number of the canteen employees are only 25 and the  said Canteen run by Mecon Welfare Committee is a non- statutory and non-recognised canteen?"

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Thereafter,  the State Government  was directed to refer the   disputes to the Industrial Tribunal under Section 10(2) of the Act for  adjudication.  The Tribunal raised the following points  for  consideration:            "(i) Whether the present reference is bad in law and on  facts.?

(ii)Whether the relationship of employer and employees  exists in between the management of Mecon or the  management of Mecon (SAIL) Welfare Committee and  the employees of Mecon Canteen, and  

       (iii) Whether the employees of Mecon Canteen are  entitled  to get pay scale and other benefits which  pay  scale and other benefits are made available to the  employees of VIP Guest House as well as the employees          of Tea  Club of Mecon?

2.      The Tribunal after  recording  necessary evidence and hearing  both the parties held that neither the reference was bad in law nor  on  facts,  relationship of  employer and employees existed between the  management of  Mecon and the  workmen of Mecon Canteen  and   that the workmen of Mecon Canteen are  entitled to get pay scales  and other benefits which were/are available to the workmen of   Mecon VIP Guest House and Mecon Tea Club from the dates of  appointments of  the concerned workmen.    This award was  challenged  by  the MECON by filing writ petition in the High Court.      and submitted that the Tribunal had misdirected itself  in framing  the  question.    It was  said that the question referred   as directed by the  Supreme Court clearly implied  that the workers of the canteen  were   employed by the Mecon Welfare Committee, distinct from MECON  and the question was whether those persons  were liable to be  treated as employees of the  MECON.    Since the  question was  wrongly   framed,  therefore,  the wrong answer has been  given  by  the Tribunal.   This  was opposed by the   Canteen Sabha and  a  preliminary objection was  raised   to the effect that the writ petition  was not maintainable.   Learned single judge  dismissed the  preliminary objection of the canteen Sabha and upheld the order of  the Tribunal  and  declined to interfere under Article 226 of the  Constitution of India.  Aggrieved against this order the MECON   approached  the division bench by filing the  appeal, and the division  bench after properly construing the matter came to the conclusion  that the canteen was  run by the  Canteen Welfare Committee  for   the welfare of the staff  and  workmen of Mecon.  Therefore,  there  was  no    Master and servant  relationship between the employees of  the Canteen  and Mecon, and  as such they are not entitled to the  same service benefits as are  admissible to the  employees of  the  MECON  serving for the VIP Guest House  or for the Tea Club.     Consequently,  the  Division Bench set  aside the order of  the  Tribunal as well as the order of the single  Judge and dismissed  the  writ petition.   Hence the present appeal  by the  Canteen Mazdoor  Sabha.

3.    We have heard learned counsel for the parties & perused the  record. 4.    The basic question before us is whether these canteen  employees are part of Mecon or not.  There is no two opinion in the  matter that  the canteen is not managed by the management of  Mecon.  The point which ought to have been addressed by the  Tribunal as well as by the Single Judge of High Court was what is the  co-relation between the management of the canteen with  the  management of Mecon.  Therefore, in order to answer this question

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whether the employees of the canteen are equated with the  employees of  Mecon  the Tribunal and the Single Judge of High  Court should have addressed the question whether  there is  master  and servant relationship between the employees of the canteen with  the management of Mecon. If that is not established, then there is no  question of seeking any parity with the pay scale of the employees of  Mecon.  Simply because the canteen workers are discharging same  duties as are being discharged by the employees of the V.I.P.Guest  House or  the Tea Club, that will not serve the purpose.  On the  evidence it appears that there is no such master and servant  relationship between the two. In the present case, from the facts  it is  more than evident that the employees of canteen are appointed by  the Canteen Welfare Committee and not by Mecon.  Therefore,  the  canteen was not being run either under a statutory obligation or an  obligation arising out of any standing order or other binding circulars  of Mecon.  It was also pointed out that there is no evidence to show  that providing of canteen service was a part of the service conditions  of the employees of Mecon.  There is no contract between the Mecon  with the employees in the canteen to this effect. Therefore, the  learned Division Bench correctly approached the matter and rightly  addressed whether there exists any relationship of master and  servant between Mecon and the Canteen workers.  The admitted  facts are that the Management of Mecon had not recognized the  Union of employees of the canteen.  The day to day sales are  deposited in the account of the Canteen Welfare Committee.  The  workmen of the canteen are never transferred either to the VIP Guest  House or to the Tea Club or vice versa. The workmen at the VIP  Guest House and Tea Club are appointed by the Mecon. There was  no bank account given to the workmen employed in the canteen by  the Management of Mecon and their salaries were not transferred to  their respective bank accounts by Mecon unlike in the case of the  employees of the VIP Guest House and the Tea Club.   Since there is  no relationship of master and servant between  the employees of the  canteen and  Mecon, therefore, there is no question of giving them  the salary at par with that of the employees of Mecon. These  controversies have  been put to rest long back and this Court has  made a distinction between the statutory canteens and non-statutory  canteens which are required to be established either by the statute,  they stand on one footing and the other canteen which is run by the  Welfare Committee stands on a different footing.  This distinction has  been maintained right from the beginning i.e. in M.M.R.Khan & Ors.  V. Union of India & Ors. [  1990 (Supp.) SCC 191]. In that case their  Lordships have made a distinction  that the canteens run by different  railway establishments are classibiable into three categories i.e. (i)  statutory canteens, (ii) non-statutory recognised canteens and (iii)  non-statutory non-recognised canteens.  Their Lordships said that the  employees of the non-statutory non-recognised canteens stand on a  different footing and are not entitled to claim the status of railway  employees. It was observed as under:         "  However, the employees of the non-statutory  non-recognised canteens are not entitled to claim the  status of the railway servants. These canteens are  run more or less on ad hoc basis, the railway  administration having no control on their work.  Neither is there a record of these canteens nor of the  contractors who run them who keep on changing,  much less  of the workers engaged in these  canteens."

       However in this case,  this  Court gave relief on factual  metrix.  Similarly, in  Employers in relation to the Management of Reserve  Bank of India  V. Workmen [ (1996) 3 SCC 267], similar observation  was made by a three Judge Bench of this Court wherein the issue  involved was  whether  the workers engaged in the canteens of the

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Reserve Bank of India  can be treated as employees of the Reserve  Bank of India and their services can be regularized or not. Their  Lordships said that since these workers are not under the disciplinary  control of the Reserve Bank of India and there existed no ’master and  servant’ relationship between them, therefore, they are not entitled to  the same service conditions as are admissible to the employees of  the Reserve Bank of India. In this connection, their Lordships  observed that the Bank has a very limited role regarding the  functioning of the Welfare Committee which is managing the canteen  and it does not have any control whatsoever over the employees  engaged by the Committee so far as taking any disciplinary action  against any particular employee is concerned. The recruitment of the  workers for the canteen is made by the Canteen Committee and the  attendance record as well as the sanctioning of leave to the workers  is done by the committee.  The only role played by the Bank in the  running of the canteen is the nomination of the three members to the  Committee.  It was also observed that there is common ground that   the canteen run by the Implementation Committee ( Canteen  Committee ) is not under any legal obligation. There is no right in the  Bank to supervise and control the work done by the persons  employed in the Committee nor has the Bank  any right to direct the  manner in which the work shall be done by various persons. The  Bank  only exercises a remote control. Therefore, their Lordships  observed as follows :

               " Therefore, in the absence of any  obligation, statutory or otherwise, regarding the  running of a canteen by the Bank and the details  relating thereto similar to Factories Act or the  Railway Establishment Manual, and in the absence  of any effective or direct control in the Bank to  supervise and control the work done by various  persons, the workers in the canteen run by the  Implementation Committee (Canteen Committee)  cannot come within the ratio of M.M.R.Khan case."

The decision in M.M.R.Khan case (supra) was explained by this  Court by a subsequent three Judge Bench.

5.      Similarly, in State Bank of India & Ors. V. State Bank of India  Canteen Employees’ Union (Bengal Circle)  & Ors. [ (2000) 5 SCC  531], their Lordships observed that in order to provide canteen  facilities by providing subsidy is altogether different from running the  canteen. Their Lordships observed as follows : " Presuming that the privilege of providing canteen  facilities to the employees exists, yet it cannot be  held that the Bank should provide the said facility by  running a canteen by itself. To promote canteen  facilities by providing subsidy or  other facilities is  altogether different from running the canteen.  Running  of a canteen in a small branch having staff  strength less than a particular limit may not be  economical, but may be a waste. There is a vast  difference between "promotion" and "providing".  Further, the appointment of the employees by the  Bank has been regulated by the State Bank of India  General Regulations, which are statutory Regulations  framed by Reserve Bank of India with the previous  sanction of the Central Government in exercise of  powers conferred  by Section 50(3) of the State Bank  of India Act, 1955. In the case of employees of  canteens run by LICs, the Bank does not have any  control in their appointment and the aforesaid  Recruitment Rules are not required to be observed."

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Similarly, in State of Haryana  & Ors. V. Charanjit Singh & Ors.   [(2006) 9 SCC 321], another three Judge Bench of this Court had  occasion to consider the matter with regard to  Article 39(d) of the  Constitution of India i.e. ’equal pay for equal work’.  Their Lordships  said that there must be everything identical and equal. The concept of  ’equal pay for equal work’ has undergone a sea of change in series of  subsequent decisions. Their Lordships after reviewing all the case  laws on the subject observed as follows :

" Undoubtedly, the doctrine of "equal pay for equal  work" is not an abstract doctrine and is capable of  being enforced in a court of law. But equal pay must  be for equal work of equal value. The finding in  Devinder Singh case, (1998) 9 SCC 595, that for  similar work the principle of equal  pay applies,  cannot be accepted. Equal pay can only be given for  equal  work of equal value. The principle of "equal  pay for equal" has no mechanical application in every  case. Article 14 permits reasonable classification  based on qualities or characteristics of persons  recruited and grouped together, as against those  who were left out. Of course, the qualities or  characteristics must have a reasonable relation to  the object sought to be achieved. In service matters,  merit or experience can be a proper basis for  classification for the purpose of pay in order to  promote efficiency in administration. A higher pay  scale to avoid stagnation or resultant frustration for  lack of promotional avenues is also an acceptable  reason for pay differentiation. The view that there  cannot be discrimination in pay on the ground of  differences in modes of selection taken in Bhagwan  Dass case, (1987) 4 SCC 634, cannot be accepted.  The very fact that the person has not gone through  the process of recruitment may itself, in certain  cases, make a different. If the educational  qualifications are different, then also the doctrine  may have no application. Even though persons may  do the same work, their quality of work may differ.   Where persons are selected by a Selection  Committee on the basis of merit with due regard to  seniority  a higher pay scale granted to such persons  who are evaluated by  the competent authority  cannot be challenged. A classification based on  different in educational qualifications justifies a  different in pay scales. A mere nomenclature  designating a person as say a carpenter or a  craftsman is not enough to come to  the conclusion  that he is doing the same  work as another carpenter  or craftsman in regular service. The quality of work  which is produced may be different and even the  nature of work assigned may be different.  It is not  just a comparison of physical activity. The application  of the principle of "equal pay for equal work" requires  consideration of various dimensions of a given job.  The  accuracy required  and the dexterity that the job  may entail may differ from job to job. It cannot be  judged by the mere volume of work. There may be  qualitative difference as regards reliability and  responsibility. Functions may be the same but the  responsibilities make a different. Thus normally the  applicability of this principle must be lest to be  evaluated and determined by an expert body. These

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are not matters where  a writ court can lightly  interefere."

Therefore, their Lordships after reviewing all the judgments have  considered all the facets of the principle of Article 39(d) of the  Constitution of India.

6.      Now, adverting to the facts of the present case,  the question  which was framed by this Court while remitting the matter for  reference clearly stated, which has been reproduced above,  whether   the employees of the  canteen engaged and employed by MECON  Welfare Committee consisting of the representatives of MECON  (Non-executive) Employees’ Union, MECON Executive Association  and nominees of MECON are entitled to the same service conditions  as are applicable to the  employees of the VIP Guest House and of  the Tea Club who are employed and engaged by MECON?  Therefore, in order to bring them at par with the employees of the  V.I.P.Guest House and Tea Club of Mecon,  one has to decide what  is the relationship of the employees of the canteen with the  management of Mecon. Learned counsel for the appellant submitted  that the Division Bench has gone wrong and should not have gone  into the question of relationship of employees of the canteen with that  of the management of Mecon. In fact, without first crossing this hurdle  it was not possible to come to any decision  whether  the employees  who are recruited by the Mecon management at V.I.P.Guest House  or Tea Club can be treated at par with the employees of the canteen  of Mecon  and they should be given the same pay scale as given to  the employees of the V.I.P.Guest House or Tea Club.  In fact this  question was inherent in the questions framed by this Court and the  Tribunal  also framed question whether relationship of employer and  employee existed between the management of Mecon and  employees of the canteen managed by the welfare committee.   Therefore, it is not correct on the part of learned counsel for the  appellant to submit that this question should not have been gone into  and if this question has been wrongly framed or wrongly referred   before the Tribunal then the matter should have been directly  approached by the Management of the Committee before this Court.  The argument of learned counsel for the appellant is totally  misconceived. In order to grant equal pay for equal work one has to  first address the question whether there is any master and servant  relationship between the canteen employees and  Mecon.  In fact,  without going into this question, other questions could not have been  answered. In this view of the matter, the Division  Bench correctly  approached the matter and found that  since there is no master and  servant relationship between the employees of the canteen and  Mecon, the workers of the canteen  are not entitled to claim the salary  which is given to the employees serving in the V.I.P.Guest House or  Tea Club.

7.      As a result of our above discussion, we are of opinion that the  view taken by the Division Bench of the High Court appears to be  correct and there is no ground to interfere with the  order of the High  Court. Consequently, the appeal fails and is dismissed with no order  as to costs.