REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 3433 OF 2007

Maharashtra State Road Transport Corporation & Anr.        …Appellants

Versus   Casteribe Rajya P. Karmchari Sanghatana   …Respondents With Civil Appeal No. 3434/2007 Civil Appeal No. 3435/2007 Civil Appeal No. 3436/2007 Civil Appeal No. 3437/2007

JUDGMENT R.M. Lodha, J.

Principally, two questions which this Court is called  

upon to determine in this group of five  civil appeals by special  

leave are:

(one) : Whether a direction to the  Maharashtra  State  Road  Transport  Corporation  (for  short,  “Corporation”)  by  the   Industrial  Court,  and  confirmed by the High Court of giving status, wages  and  all other benefits of permanency,  applicable to  the post of Cleaners to the complainants is justified?

(two) : Whether  the  two  complaints  filed  by  Casteribe Rajya Parivahan Karmchari  Sanghatana  (for  short,  “Union”),  an  unrecognised  union  under  Maharashtra  Recognition  of  Trade  Unions  &  Prevention  of  Unfair  Labour  Practices  Act,  1971  (for  short,  “MRTU  &  PULP  Act”),  alleging  unfair  labour practice on the  part of the employer under  item No. 6  of Schedule IV are maintainable?  

2. The Union,  although  a registered union  under the  

Trade Union Act,  but  unrecognised  under  MRTU  & PULP  

Act,  filed  two  complaints,  namely,  complaint  (ULP)  No.  

542/1991   and  complaint  (ULP)  No.  574/1991   before  the  

Industrial  Court,  Bombay  alleging  that  the  Corporation   has  

indulged  in unfair labour practice under item nos. 5,6,9 and 10  

of Schedule IV of  MRTU & PULP Act.  The   names of the  

affected  employees were mentioned in the annexures annexed  

with  the  complaints.   All  these  affected  employees   were  

engaged  by the Corporation as casual labourers  for  cleaning  

the  buses  between the   years  1980-85.    According  to  the  

complainants, these  employees are required to work everyday  

at least eight hours at the concerned depot of the Corporation;  

the  work done by these employees is of permanent nature but  

they are  being paid a  paltry   amount;  and that  the  posts  of  

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sweepers/cleaners are available in the Corporation  yet these  

employees have been kept on casual and temporary  basis for  

years together denying them  the benefit  of permanency.

3. Another  complaint (ULP No. 442 of 1992) was filed  

by  19  individual   employees  before  Industrial  Court,  Thane,  

raising  the identical dispute.    

4. The  Corporation  resisted  these  complaints  on  

diverse grounds.  Insofar as  the complaints by the Union were  

concerned,  the Corporation  raised  the plea that these were  

not   maintainable  as  the  Union  was   unrecognised   Union  

under  MRTU & ULP Act.  The  Corporation  stated that  the  

complainants  were  engaged   for   cleaning   the  buses  on  

contract  basis  @  1.50  paise  per  bus  and  they  were  not  

employed  as  ‘badlis’,  casual  or  temporary  workers;  that  the  

engagement  of  these workers  on  contract  basis  is  purely  of  

casual nature; that prior to  1980, the Corporation buses were  

being  cleaned  by  regular  helpers  but  some  problems  arose  

amongst the employees later on and, it  was decided  not  to  

compel the qualified  helpers to clean and sweep the buses;  

that  since the Corporation was facing acute problem regarding  

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cleaning of the buses and the negotiations were going on with  

the respective unions,  it was decided that those who volunteer  

their  services  by  reporting  at  the   respective  depot  may be  

allowed to clean the buses  on contract basis.  The Corporation  

stated that  these workers cannot be provided with the status of  

permanency on par with the other permanent cleaners.     

5. The  parties  led  oral  as  well  as  documentary  

evidence  before  the  Industrial  Court,  Bombay  in  Complaint  

ULP nos. 542  and 574 of 1991 and  before Industrial Court,  

Thane, in  Complaint ULP no. 442/1992.   

6. The Industrial  Court, Bombay in the two complaints  

filed  by  the  Union  held  that  the  complaint  regarding  unfair  

labour  practice  against  the  Corporation  under  item  6  of  

Schedule IV was not maintainable.  However, the complaints  

were  maintainable  in  respect  of  unfair  labour  practice  under  

item nos.  5,9 and 10.     The Industrial  Court   held that  the  

Corporation  committed unfair   labour practice under items 5  

and 9 of Schedule IV of MRTU & PULP Act and vide  order  

dated May 2, 1995 the Corporation was directed to pay equal  

wages  to  the  concerned  employees  which  are  paid  to  

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Swachhak and pay arrears of wages to them from the date of  

filing of the complaints.   The Industrial Court,  Thane decided  

complaint ULP No. 442/1992 vide its order  dated February 6,  

1997 and held that  the Corporation indulged in  unfair  labour  

practice  under  item  6  of  Schedule  IV   by  continuing  the  

complainants as temporary/casual/daily wage workers for years  

together  and  thereby  depriving  them  the  benefits  of  

permanency.   The  Industrial  Court,   Thane,   accordingly,  

directed the  Corporation to cease and  desist  from the said  

unfair practice within one month from the date of the order by  

giving   status,  wages  and  all  other  benefits  of  permanency  

applicable to the post of cleaners to  the complainants w.e.f.  

August 3, 1982.

7. The aforesaid two orders passed by the Industrial  

Court,  Bombay as well as Industrial Court, Thane came to be  

challenged by the Union,  the employees and the Corporation  

before the High Court of Judicature at Bombay (appellate side)  

in five separate writ petitions.     The learned single   Judge of  

the  High  Court   heard  these  five  writ  petitions  together  and  

disposed of them by a common judgment on August 2, 2001.  

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The  learned  single  Judge  held  that  the  complaints  by  the  

unrecognized union under item 6 of  Schedule IV  of MRTU &  

PULP Act  were  maintainable and that Corporation indulged in  

unfair labour practice under item 6 of Schedule IV.  The learned  

single Judge also held that there is unfair labour practice  on  

the part of  the  Corporation under item no. 5 of Schedule IV as  

well.   The single Judge, accordingly, directed that employees  

mentioned in the two complaints filed by the Union be given  

benefit of permanency including salary and allowances from the  

date of filing the respective complaints.  

8. Aggrieved  by  the  judgment  of  the  single  Judge  

passed  on  August  2,  2001,  the  Corporation  preferred  five  

Letters Patent Appeals  which came to be dismissed on May 6,  

2005.  Hence,  these five appeals by special leave.

re:  question (one)

9. Mr.  Altaf  Ahmad,  learned  Senior  Counsel  for  the  

Corporation,  heavily  relied upon General  Standing Order No.  

503  dated 19th June, 1959 and the decision by  the Constitution  

Bench of this Court in the case of Secretary, State of Karnataka  

and Others vs. Umadevi and Others1 in assailing the direction  1 (2006) 4 SCC 1

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of  giving  status,  wages and  other  benefits  of  permanency  

applicable to the post of cleaners.  The learned Senior Counsel  

would  submit  that   granting permanent  status to employees  

who were  working as casual workers/daily wagers and whose  

appointments  were  made  without  following  the  procedure  

prescribed   in  General  Standing Order  503 on non-existent  

posts  is  unsustainable in law.   He  extensively referred to the  

Constitution Bench decision in  Umadevi1.  The learned Senior  

Counsel  submitted  that   no direction could be given by the  

Court for creation of posts.  In this regard,  he relied upon two  

decisions  of  this  Court  viz.:   Mahatma  Phule  Agricultural   

University and Others vs. Nasik Zilla Sheth Kamgar Union &  

Ors.2 and   Karnataka State Road Transport  Corporation and  

Anr. vs. S.G. Kotturappa and Anr.3  

10.   Mr.  Shekhar Naphade, learned Senior Counsel for  

the employees and Mr. Vinay Navare, learned counsel for the  

Union stoutly defended the direction given to the Corporation in  

according  permanency  and   consequential  benefits  to  the  

affected employees.  

2 (2001) 7 SCC 346 3 (2005) 3 SCC 409

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11. We  deem  it   appropriate  to  notice  the   relevant  

provisions of  MRTU & PULP Act  first.  But before we do that it  

is  important  to notice that  MRTU & PULP Act was enacted  

with an object to provide for the recognition   of trade unions  for  

facilitating  collective   bargaining  for  certain  undertakings;  to  

state their rights and obligations; to confer  certain powers on  

unrecognized unions;  to provide for   declaring certain strikes  

and lockouts as  illegal strikes and lockouts;   to define  and  

provide  for the  prevention of certain unfair labour practices;  

to constitute courts (as independent machinery) for carrying out  

the purposes of  according recognition   to trade unions  and for  

enforcing the  provisions relating to unfair labour practices; and  

to provide for matters connected with the purposes aforesaid.

12. A “recognized  union”  under Section 3(13) means a  

union which has been issued a certificate of recognition under  

Chapter III of the Act.

13. “Unfair  labour  practice”  means  those  defined  in  

Section 26.    Section 26 defines them to mean the practices  

listed in Schedules II, III and IV.  Schedule II deals with  unfair  

labour   practices  on  the  part  of  the  employers;  Schedule  III  

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deals with unfair labour practices on the part of  trade unions  

and Schedule IV deals with general unfair labour practices on  

the part of the employers.

14. Section  21  confers  a  right  upon  the  recognized  

union to  appear  or  act  in  the proceedings relating to  certain  

unfair labour practices.  It reads thus:

“21.  Right  to  appear  or  act  in  proceedings  relating to  certain unfair labour practices

(1) No  employee  in  an  undertaking  to  which  the  provisions of the Central Act for the time being apply, shall  be allowed to appear or act or allowed to be represented in  any proceedings relating to unfair labour practices specified  in items 2 and 6 of Schedule IV of this Act except through  the recognized union:

Provided  that,   where  there  is  no  recognized  union  to  appear,  the employees may himself  appear  or  act  in  any  proceeding relating to any such unfair labour practices.

(2) Notwithstanding  anything  contained  in  the  Bombay  Act,  no   employee  in  any  industry  to  which  the  provisions  of  the  Bombay  Act,  for  the  time  being  apply,  shall be allowed to appear  or act or allowed to  be  represented  in  any  proceeding  relating  to  unfair  labour  practices  specified  in  items  2  and  6  of  Schedule  IV  of  this  Act   except  through  the  representative of employees entitled to appear under  Section 30 of the Bombay Act.”

15. Section 28 reads thus:

“28. Procedure for dealing with complaints relating to  unfair labour practices

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(1) Where any person has engaged in or is engaging in any  unfair labour practice, then any union or any employee or  any  employer or any  Investigating Officer may, within  ninety  days  of  the  occurrence  of  such  unfair  labour  practice,  file a complaint before the Court competent to  deal with such complaint either under Section 5, or as the  case may be, under Section 7 of this Act.

Provided  that,  the Court may entertain a complaint after the  period  of  ninety  days  from  the   date  of  the  alleged  occurrence, if good and sufficient reasons are shown by the  complainant for the late filing of the complaint.

2. The Court shall take a decision on every such complaint  as far as possible within a period of six months from the  date of receipt of the complaint.

3. On  receipt  of  a  complaint  under  sub-section  (1),  the  Court  may, if  it  so considers necessary,  first  cause an  investigation into the said complaint to be made by the  Investigating Officer, and direct that a report in the matter  may be submitted by him to the Court,  within the period  specified in the direction.

4. While  investigating  into  any  such  complaint,  the  Investigating Officer may visit   the undertaking,   where  the practice alleged is said to have occurred,  and make  such enquiries as he considers necessary. He may also  make efforts to promote settlement of the complaint.

5. The Investigating Officer shall, after investigating into the  complaint under sub-Section (4) submit his report to the  Court,  within the time specified by it,  setting out the full  facts  and  circumstances  of  the  case,  and  the  efforts  made by him in settling the complaint.    The Court shall,  on  demand  and  on  payment  of  such  fee  as  may  be  prescribed by rules, supply  a copy of the report to the  complainant and the person complained against.

6. If, on receipt of the repot of the Investigating Officer, the  Court  finds  that  the  complaint  has  not  been  settled  satisfactorily,   and that  facts  and circumstances of  the  case   require,   that  the  matter  should  be   further  considered by it,  the Court shall proceed to consider it,  and give its decision.

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7. The decision of the Court,  which shall be in writing, shall  be in the form of  an order.  The order of the Court shall  be final and shall not be called in question in any civil or  criminal court.

8. The Court shall cause its order to  be published in such  manner as may be prescribed.  The order of the Court,  shall become enforceable from the date specified  in the  order.

9. The Court shall forward  a copy of its order to the State  Government and such officers of the State Government  as may be prescribed.”

16. Section  30  sets  out  the  powers  of  Industrial  and  

Labour Courts as follows:

“30. Powers of Industrial and Labour Courts

(1) Where a Court decides that any person named in the  complaint  has  engaged  in,  or  is  engaging  in,  any  unfair labour practice, it may in its order –

(a) declare  that  an  unfair  labour  practice  has  been  engaged in or is being engaged in by that person, and  specify any other person who has engaged in, or is  engaging in the unfair labour practice;

(b) direct all such persons to cease and desist from such  unfair labour practice, and take such affirmative action  (including  payment  of  reasonable  compensation  to  the  employee  or  employees  affected  by  the  unfair  labour practice, or reinstatement of the employee or  employees  with  or  without  back  wages,  or  the  payment of reasonable compensation) as  may in the  opinion of  the Court  be necessary to effectuate the  policy of the Act;

(c) where  a  recognized  union  has  engaged  in  or  is  engaging in, any unfair labour practice,  direct that its  recognition shall be cancelled or that all or any of its  

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rights under sub-section (1) of Section 20 or its right  under Section 23 shall be suspended.   

(2) In any proceeding before it under this Act,  the Court,  may pass such interim order (including any temporary  relief or restraining order) as it deems just and proper  (including  directions  to  the  person  to  withdraw  temporarily  the practice  complained of,  which  is  an  issue in such proceeding),  pending final decision:

Provided  that,  the  Court  may,  on  an  application  in  that  behalf, review any interim order passed by it.

(3) For the purpose of holding an enquiry or proceeding  under this Act,  the Court shall have the same powers  as are vested in Courts in respect of –

(a) proof of facts by affidavit; (b) summoning  and  enforcing  the  attendance  of  

any person, and examining him on oath. (c) Compelling the production of documents;  and  (d) Issuing  commissions  for  the  examination  of  

witnesses.

(4) The Court shall also have powers to call upon any of  the  parties  to  proceedings  before  it  to  furnish  in  writing, and in such forms as it may think proper, any  information,  which  is  considered  relevant  for  the  purpose of any proceedings before it, and the party so  called upon shall thereupon furnish the information to  the best of its knowledge and belief, and if so required  by the Court to do so, verify the same in such manner  as may be prescribed.”

17. Section 32 provides that  the Court  shall  have the  

powers to  decide  all   connected matters  arising  out  of  any  

application or a complaint referred to it for the decision under  

any of the provisions of this Act.

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18. Having surveyed the relevant provisions of MRTU &  

PULP ACT, it is now time to consider the Constitution Bench  

decision  in  Uma  Devi1.   In  paragraph  10,   the  Constitution  

Bench  has quoted the order of reference which reads:

“1. Apart from the conflicting opinions between the three- Judge Bench decisions in Ashwani Kumar v. State of Bihar;   ((1997) 2 SCC 1,  State of Haryana v.  Piara Singh; (1992)4  SCC  118  and  Dharwad  Distt.  PWD  Literate  Daily  Wage  Employees Assn. v.  State of Karnataka (1990) 2 SCC 396  on the one hand and State of H.P. v. Suresh Kumar Verma;  (1996)  7  SCC  564,  State  of  Punjab v.  Surinder  Kumar;   (1992)  1  SCC  489 and  B.N.  Nagarajan v.  State  of   Karnataka; (1979) 4 SCC 507 on the other, which have been  brought  out  in  one of  the  judgments  under  appeal  of  the  Karnataka High Court in  State of Karnataka v.  H. Ganesh  Rao; (2001) 4 Kant LJ 466 (DB), decided on 1-6-2001 the  learned Additional Solicitor General urged that the scheme  for regularisation is repugnant to Articles 16(4), 309, 320 and  335  of  the  Constitution  and,  therefore,  these  cases  are  required  to  be  heard  by  a  Bench  of  five  learned  Judges  (Constitution Bench).

2. On the other hand, Mr M.C. Bhandare, learned Senior  Counsel,  appearing  for  the  employees  urged  that  such  a  scheme for regularisation is consistent with the provisions of  Articles 14 and 21 of the Constitution.

3. Mr V. Lakshmi Narayan, learned counsel appearing in  CCs Nos. 109-498 of 2003,  has filed the GO dated 19-7- 2002  and  submitted  that  the  orders  have  already  been  implemented.

4.  After  having  found  that  there  is  conflict  of  opinion  between the three-Judge Bench decisions of this Court, we  are of the view that these cases are required to be heard by  a Bench of five learned Judges.

5.  Let  these matters  be placed before  the Hon’ble the  Chief Justice for appropriate orders.”

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19. The Constitution Bench in  Umadevi1 considered a  

long line of cases; constitutional scheme in public employment;  

powers of  the High Courts  under  Article  226;  powers of  this  

Court  under  Articles  32;  other  constitutional  provisions  viz.;  

Articles 14, 16, 21 and 309 of the Constitution and laid down  

that the High Court acting under Article 226 of the Constitution  

could  not  ordinarily   issue  directions  for  regularization  and  

permanent continuance unless the recruitment itself was made  

regularly  and  in  terms  of  the  constitutional  scheme.   The  

Constitution Bench observed thus:

“43. Thus, it is clear that adherence to the rule of equality  in public employment is a basic feature of our Constitution  and since the rule of law is the core of our Constitution, a  court  would  certainly  be  disabled  from  passing  an  order  upholding  a  violation  of  Article  14  or  in  ordering  the  overlooking of the need to comply with the requirements of  Article 14 read with Article 16 of the Constitution. Therefore,  consistent with the scheme for public employment, this Court  while  laying  down  the  law,  has  necessarily  to  hold  that  unless the appointment is in terms of the relevant rules and  after  a  proper  competition  among  qualified  persons,  the  same would not confer any right on the appointee. If it is a  contractual appointment, the appointment comes to an end  at  the  end  of  the  contract,  if  it  were  an  engagement  or  appointment on daily wages or casual basis, the same would  come  to  an  end  when  it  is  discontinued.  Similarly,  a  temporary employee could not claim to be made permanent  on the expiry of his term of appointment. It has also to be  clarified  that  merely  because  a  temporary  employee or  a  casual wage worker is continued for a time beyond the term  of his appointment, he would not be entitled to be absorbed  in  regular  service  or  made  permanent,  merely  on  the  strength of such continuance, if the original appointment was  not  made  by  following  a  due  process  of  selection  as  envisaged by the relevant rules. It is not open to the court to  prevent  regular  recruitment  at  the  instance  of  temporary  

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employees whose period of employment has come to an end  or  of  ad  hoc  employees  who by  the  very  nature  of  their  appointment,  do  not  acquire  any  right.  The  High  Courts  acting  under  Article  226  of  the  Constitution,  should  not  ordinarily  issue directions  for  absorption,  regularisation,  or  permanent  continuance  unless  the  recruitment  itself  was  made regularly and in terms of  the constitutional  scheme.  Merely because an employee had continued under cover of  an order of the court, which we have described as “litigious  employment” in the earlier part of the judgment, he would not  be entitled to any right to be absorbed or made permanent in  the service. In fact, in such cases, the High Court may not be  justified  in  issuing  interim  directions,  since,  after  all,  if  ultimately the employee approaching it  is found entitled to  relief, it may be possible for it to mould the relief in such a  manner that ultimately no prejudice will  be caused to him,  whereas  an  interim  direction  to  continue  his  employment  would hold up the regular procedure for selection or impose  on the State the burden of paying an employee who is really  not  required.  The courts  must  be  careful  in  ensuring  that  they do not interfere unduly with the economic arrangement  of  its  affairs  by  the  State  or  its  instrumentalities  or  lend  themselves the instruments to facilitate the bypassing of the  constitutional and statutory mandates.”

20. Pointing out the difference between the concept of  “equal  

pay for equal work” and the concept of conferring “permanency”  

for those who have been appointed on ad hoc basis/ temporary  

basis  and without any  process of selection as envisaged in the  

Rules, the Court held:

“44. The  concept  of  “equal  pay  for  equal  work”  is  different  from  the  concept  of  conferring  permanency  on  those who have been appointed on ad hoc basis, temporary  basis, or based on no process of selection as envisaged by  the rules.  This Court  has in various decisions applied the  principle of equal pay for equal work and has laid down the  parameters  for  the  application  of  that  principle.  The  decisions are rested on the concept of equality enshrined in  our Constitution in the light of the directive principles in that  behalf. But the acceptance of that principle cannot lead to a  position  where  the  court  could  direct  that  appointments  

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made  without  following  the  due  procedure  established  by  law, be deemed permanent or issue directions to treat them  as permanent. Doing so, would be negation of the principle  of equality of opportunity. The power to make an order as is  necessary for doing complete justice in any cause or matter  pending before this Court,  would not normally be used for  giving the go-by to the procedure established by law in the  matter of public employment. Take the situation arising in the  cases before us from the State of Karnataka. Therein, after  Dharwad  decision the  Government  had  issued  repeated  directions and mandatory orders that no temporary or ad hoc  employment  or  engagement  be  given.  Some  of  the  authorities and departments had ignored those directions or  defied  those  directions  and  had  continued  to  give  employment, specifically interdicted by the orders issued by  the  executive.  Some of  the  appointing  officers  have  even  been  punished  for  their  defiance.  It  would  not  be  just  or  proper  to  pass  an  order  in  exercise  of  jurisdiction  under  Article 226 or 32 of the Constitution or in exercise of power  under  Article  142  of  the  Constitution  permitting  those  persons engaged, to be absorbed or to be made permanent,  based  on  their  appointments  or  engagements.  Complete  justice would be justice according to law and though it would  be open to this Court to mould the relief, this Court would not  grant  a  relief  which  would  amount  to  perpetuating  an  illegality.”

21. The Court deprecated the issuance of directions by  

the  Court for regularization or making the temporary or casual  

employees permanent on the ground that such a person  has  

worked for a considerable length of time.   It was observed:

“45. While  directing  that  appointments,  temporary  or  casual,  be  regularised  or  made  permanent,  the  courts  are  swayed by the fact that the person concerned has worked for  some time and in some cases for a considerable length of  time. It is not as if the person who accepts an engagement  either  temporary  or  casual  in  nature,  is  not  aware  of  the  nature of his employment. He accepts the employment with  open  eyes.  It  may  be  true  that  he  is  not  in  a  position  to  bargain—not  at  arm’s  length—since  he  might  have  been  searching  for  some  employment  so  as  to  eke  out  his  livelihood and accepts whatever he gets. But on that ground  alone, it would not be appropriate to jettison the constitutional  

16

scheme of appointment and to take the view that a person  who  has  temporarily  or  casually  got  employed  should  be  directed to be continued permanently. By doing so, it will be  creating  another  mode  of  public  appointment  which  is  not  permissible.  If  the  court  were  to  void  a  contractual  employment of this nature on the ground that the parties were  not having equal bargaining power, that too would not enable  the court to grant any relief to that employee. A total embargo  on  such  casual  or  temporary  employment  is  not  possible,  given the exigencies of administration and if imposed, would  only mean that  some people who at  least  get  employment  temporarily,  contractually  or  casually,  would  not  be  getting  even  that  employment  when securing  of  such  employment  brings at least some succour to them. After all, innumerable  citizens of our vast country are in search of employment and  one  is  not  compelled  to  accept  a  casual  or  temporary  employment  if  one  is  not  inclined  to  go  in  for  such  an  employment. It is in that context that one has to proceed on  the basis that the employment was accepted fully knowing the  nature of  it  and the consequences flowing from it.  In other  words,  even  while  accepting  the  employment,  the  person  concerned knows the nature of his employment. It is not an  appointment to a post in the real sense of the term. The claim  acquired  by  him  in  the  post  in  which  he  is  temporarily  employed or the interest in that post cannot be considered to  be of  such a magnitude as to  enable  the giving up of  the  procedure  established,  for  making  regular  appointments  to  available posts in the services of the State. The argument that  since one has been working for some time in the post, it will  not be just to discontinue him, even though he was aware of  the nature of the employment when he first took it up, is not  one  that  would  enable  the  jettisoning  of  the  procedure  established by law for public employment and would have to  fail  when  tested  on  the  touchstone  of  constitutionality  and  equality  of  opportunity  enshrined  in  Article  14  of  the  Constitution.”

22. The  earlier  decisions  of  this  Court  in  Dharwad  

District PWD Literate Daily Wage Employees Assn. vs. State of   

Karnataka4,  State  of  Haryana  vs.  Piara  Singh5,  Jacob  M.  

Puthuparambil  vs.  Kerala  Water  Authority6 and  Gujarat   

4 (1990) 2 SCC  396 5 (1992) 4 SCC  118 6 (1991) 1 SCC  28

17

Agricultural University vs. Rathod Labhu Bechar7  were held to  

be  not  laying  down   correct  law  and  it  was  held  that  the  

invocation  of  the  doctrine  of  legitimate  expectation  cannot  

enable  the  employees  to  claim  that  they  must  be  made  

permanent or they must  be regularized in the service though  

they  had  not   been  selected   in  terms  of   the  rules  for  

appointment.     The Constitution Bench went on to hold:

“47. When a person enters a temporary employment or  gets engagement as a contractual or casual worker and the  engagement  is  not  based  on  a  proper  selection  as  recognised by the relevant rules or procedure, he is aware of  the  consequences  of  the  appointment  being  temporary,  casual or contractual in nature. Such a person cannot invoke  the theory of legitimate expectation for  being confirmed in  the post when an appointment to the post could be made  only  by  following  a  proper  procedure  for  selection  and  in  cases  concerned,  in  consultation  with  the  Public  Service  Commission. Therefore, the theory of legitimate expectation  cannot be successfully advanced by temporary, contractual  or casual employees. It cannot also be held that the State  has  held  out  any  promise  while  engaging  these  persons  either  to  continue  them where  they  are  or  to  make  them  permanent. The State cannot constitutionally make such a  promise. It is also obvious that the theory cannot be invoked  to  seek  a  positive  relief  of  being  made permanent  in  the  post.”

23. The  argument   based on  Articles 14 and 16 of the  

7( 2001) 3 SCC 574

18

Constitution of India was also negatived by holding:

“48. It  was  then  contended  that  the  rights  of  the  employees thus appointed, under Articles 14 and 16 of the  Constitution,  are  violated.  It  is  stated  that  the  State  has  treated the employees unfairly  by employing them on less  than minimum wages and extracting work from them for a  pretty long period in comparison with those directly recruited  who are  getting  more  wages or  salaries  for  doing  similar  work.  The  employees  before  us  were  engaged  on  daily  wages in  the  department  concerned  on  a  wage  that  was  made known to them. There is no case that the wage agreed  upon was not being paid. Those who are working on daily  wages formed a class by themselves, they cannot claim that  they  are  discriminated  as  against  those  who  have  been  regularly recruited on the basis of the relevant rules. No right  can be founded on an employment on daily wages to claim  that  such  employee  should  be  treated  on  a  par  with  a  regularly  recruited  candidate,  and  made  permanent  in  employment,  even  assuming  that  the  principle  could  be  invoked for claiming equal wages for equal work. There is no  fundamental right in those who have been employed on daily  wages or temporarily or on contractual basis, to claim that  they have a right to be absorbed in service. As has been  held by this Court, they cannot be said to be holders of a  post,  since, a regular appointment could be made only by  making  appointments  consistent  with  the  requirements  of  Articles 14 and 16 of the Constitution. The right to be treated  equally with the other employees employed on daily wages,  cannot be extended to a claim for equal treatment with those  who  were  regularly  employed.  That  would  be  treating  unequals as equals. It cannot also be relied on to claim a  right to be absorbed in service even though they have never  been selected in terms of the relevant recruitment rules. The  arguments based on Articles 14 and 16 of the Constitution  are therefore overruled.”

24. The Constitution Bench did not accept the argument  

that  the  right  to life  protected  by Article 21 of the Constitution  

19

would include the right to employment.  The Court said:

“51. The  argument  that  the  right  to  life  protected  by  Article  21  of  the  Constitution  would  include  the  right  to  employment cannot also be accepted at this juncture. The  law is  dynamic and our Constitution is  a  living document.  May be at some future point of time, the right to employment  can also be brought in under the concept of right to life or  even included as a fundamental  right.  The new statute is  perhaps a beginning. As things now stand, the acceptance  of such a plea at the instance of the employees before us  would lead to the consequence of depriving a large number  of other aspirants of an opportunity to compete for the post  or employment. Their right to employment, if it is a part of  right to life, would stand denuded by the preferring of those  who have got in casually or those who have come through  the backdoor. The obligation cast on the State under Article  39(a) of the Constitution is to ensure that all citizens equally  have  the  right  to  adequate  means of  livelihood.  It  will  be  more consistent with that policy if the courts recognise that  an appointment  to a post  in government  service or in  the  service  of  its  instrumentalities,  can  only  be  by  way  of  a  proper selection in the manner recognised by the relevant  legislation  in  the  context  of  the  relevant  provisions  of  the  Constitution. In the name of individualising justice, it is also  not possible to shut our eyes to the constitutional scheme  and the right of the numerous as against the few who are  before the court. The directive principles of State policy have  also to be reconciled with the rights available to the citizen  under Part  III  of the Constitution and the obligation of  the  State to one and all and not to a particular group of citizens.  We, therefore, overrule the argument based on Article 21 of  the Constitution.”

25. In the cases of  irregular appointments (not illegal  

appointments)  and their  regularization  as  one time measure,  

however, the Constitution Bench referred to earlier decisions of  

this  Court  in  the  case  of   State  of  Mysore  vs.  

20

S.V.Narayanappa8,   R.N. Nanjundappa vs. T. Thimmiah9 and  

B.N. Nagarajan vs. State of Karnataka10 and said:

“53. One  aspect  needs  to  be  clarified.  There  may be  cases  where  irregular  appointments  (not  illegal  appointments) as explained in S.V. Narayanappa (AIR 1967  SC 1071),  R.N. Nanjundappa (1972) 1 SCC 409 and  B.N.  Nagarajan  (1979)  4  SCC 507 and  referred  to  in  para  15  above, of duly qualified persons in duly sanctioned vacant  posts  might  have  been  made  and  the  employees  have  continued  to  work  for  ten  years  or  more  but  without  the  intervention  of  orders  of  the  courts  or  of  tribunals.  The  question of regularisation of the services of such employees  may  have  to  be  considered  on  merits  in  the  light  of  the  principles settled by this Court in the cases abovereferred to  and in the light of this judgment. In that context, the Union of  India,  the  State  Governments  and  their  instrumentalities  should take steps to regularise as a one-time measure, the  services of such irregularly appointed, who have worked for  ten years  or  more in duly sanctioned posts but  not  under  cover  of  orders  of  the  courts  or  of  tribunals  and  should  further ensure that regular recruitments are undertaken to fill  those vacant sanctioned posts that require to be filled up, in  cases where temporary employees or daily wagers are being  now employed. The process must be set in motion within six  months from this date. We also clarify that regularisation, if  any already made, but not sub judice, need not be reopened  based  on  this  judgment,  but  there  should  be  no  further  bypassing of the constitutional requirement and regularising  or making permanent, those not duly appointed as per the  constitutional scheme.”

26. The question that arises for consideration is: have  

the provisions of  MRTU & PULP Act denuded  of the  statutory  

status by the Constitution Bench decision in Umadevi1.  In our  

judgment, it is not.   The purpose and object of MRTU & PULP  

8 AIR 1967 SC 1071 9 (1972) 1 SCC 409  10 (1979) 4 SCC 507

21

Act,  inter  alia,  is  to   define  and   provide  for  prevention  of  

certain unfair labour practices as listed in Schedule II, III and IV.  

MRTU & PULP Act empowers the Industrial and Labour Courts  

to decide that the person named in the complaint has engaged  

in or is engaged in unfair labour practice and if the unfair labour  

practice is proved, to declare that an unfair labour practice has  

been engaged in or is being engaged in by that person and  

direct such person to cease and desist  from such unfair  labour  

practice and take such affirmative action (including payment of  

reasonable  compensation  to  the  employee  or  employees  

affected by the unfair labour practice, or reinstatement of the  

employee or employees  with or  without back wages, or  the  

payment of reasonable compensation), as may in the opinion of  

the Court be necessary to effectuate  policy  of the Act.  The  

power given to the Industrial and Labour Courts under Section  

30 is very wide and the affirmative action mentioned therein is  

inclusive  and not  exhaustive.   Employing badlis,   casuals  or  

temporaries and to continue them as such for years , with the  

object  of  depriving  them  of  the  status  and  privileges  of  

permanent employees is an unfair labour practice on the part  

22

of the employer under item 6 of Schedule IV.  Once such unfair  

labour practice on the part of the employer is established in the  

complaint, the Industrial and Labour Courts are empowered to  

issue  preventive   as  well  as  positive   direction  to  an  erring  

employer.   The provisions  of    MRTU & PULP Act and the  

powers of Industrial and Labour Courts provided therein were  

not at all under consideration in the case of Umadevi1.    As a  

matter of fact, the issue like the present one pertaining to unfair  

labour practice was not at all referred, considered  or decided in  

Umadevi1.  Unfair labour practice on the part of the employer in  

engaging employees as badlies, casuals or temporaries and to  

continue them as such  for years  with the object of depriving  

them of the status and privileges of permanent employees as  

provided in item 6 of Schedule IV and the power of Industrial  

and Labour Courts under Section 30 of the Act did not fall for  

adjudication or consideration before the Constitution Bench.   It  

is  true that  the case of  Dharwad District  PWD Literate Daily  

Wage Employees Assn.7 arising out  of  industrial  adjudication  

has been considered in  Umadevi1 and that decision has been  

held to be not laying down the correct law but a careful  and  

23

complete reading of decision in Umadevi1 leaves no manner of  

doubt that what  this Court was concerned in Umadevi  was the  

exercise of power by the  High Courts under Article 226 and  

this Court  under Article 32 of the Constitution of India in the  

matters of public employment where the employees have been  

engaged as contractual, temporary or casual workers not based  

on proper selection as recognized by the rules or  procedure  

and  yet  orders  of  their  regularization  and   conferring  them  

status  of  permanency  have  been  passed.   Umadevi1  is  an  

authoritative pronouncement for the proposition that Supreme  

Court (Article 32) and High Courts (Article 226) should not issue  

directions  of  absorption,  regularization  or  permanent  

continuance of  temporary,  contractual,  casual,  daily  wage or  

ad-hoc  employees   unless  the  recruitment  itself  was  made  

regularly in terms of constitutional scheme.  Umadevi1  does not  

denude  the  Industrial  and  Labour  Courts  of  their   statutory  

power  under  Section  30  read  with  Section  32  of   MRTU &  

PULP Act to order permanency of the workers who have been  

victim  of  unfair  labour  practice  on  the  part  of  the  employer  

under item 6 of  Schedule IV where the posts on which they  

24

have been working exists.   Umadevi  cannot be held to have  

overridden  the  powers  of  Industrial  and  Labour  Courts  in  

passing appropriate order under Section 30 of MRTU & PULP  

Act,  once unfair  labour practice on the part of   the employer  

under item 6 of Schedule IV is established.

27. There cannot be any quarrel to the proposition  that  

courts  cannot  direct  creation of  posts.   In  Mahatma Phule  

Agricultural University and Others vs. Nasik Zilla Sheth Kamgar  

Union and Others11, this Court held:

"12. Mrs Jaising, in support of Civil Appeals Nos. 4461- 70 and 4457-60 [arising out of SLPs (C) Nos. 418-21 of 1999  and  SLPs  (C)  Nos.  9023-32  of  1998]  submitted  that  the  workmen were entitled to be made permanent. She however  fairly  conceded  that  there  were  no  sanctioned  posts  available to absorb all the workmen. In view of the law laid  down  by  this  Court  the  status  of  permanency  cannot  be  granted when there are no posts.  She however submitted  that this Court should direct the Universities and the State  Governments to frame a scheme by which, over a course of  time,  posts  are  created  and  the  workmen  employed  on  permanent  basis.  It  was however  fairly  pointed out  to  the  Court that many of these workmen have died and that the  Universities  have  by  now  retrenched  most  of  these  workmen. In this view of the matter no useful purpose would  be served in undergoing any such exercise.

13. To be seen that, in the impugned judgment, the High  Court  notes that,  as per  the law laid  down by this  Court,  status of permanency could not be granted. In spite of this  the High Court indirectly does what it could not do directly.  The High Court, without granting the status of permanency,  grants  wages  and  other  benefits  applicable  to  permanent  employees on the specious reasoning that inaction on the  part  of the Government in not creating posts amounted to  unfair  labour  practice  under  Item 6 of  Schedule IV of  the  MRTU & PULP Act. In so doing the High Court erroneously  

11 (2001) 7 SCC 346

25

ignores the fact that approximately 2000 workmen had not  even made a claim for permanency before it. Their claim for  permanency had been rejected  by the award  dated 20-2- 1985.  These workmen were only seeking quantification  of  amounts as per this award. The challenge, before the High  Court, was only to the quantification of the amounts. Yet by  this  sweeping order  the High Court  grants,  even to these  workmen,  the  wages  and  benefits  payable  to  other  permanent workmen.

14. Further, Item 6 of Schedule IV of the MRTU & PULP  Act reads as follows:

“6.  To  employ  employees  as  ‘badlis’,  casuals  or  temporaries and to continue them as such for years, with the  object  of  depriving  them  of  the  status  and  privileges  of  permanent employees.” The complaint was against the Universities. The High Court  notes that as there were no posts the employees could not  be made permanent. Once it comes to the conclusion that  for  lack  of  posts  the  employees  could  not  be  made  permanent, how could it then go on to hold that they were  continued as “badlis”, casuals or temporaries with the object  of depriving them of the status and privileges of permanent  employees? To be noted that the complaint was not against  the  State  Government.  The  complaint  was  against  the  Universities.  The  inaction  on  the  part  of  the  State  Government to create posts would not mean that an unfair  labour practice had been committed by the Universities. The  reasoning given by the High Court to conclude that the case  was squarely covered by Item 6 of Schedule IV of the MRTU  & PULP Act cannot be sustained at all  and the impugned  judgment has to be and is set aside. It is however clarified  that the High Court was right in concluding that, as per the  law laid down by this Court, status of permanency could not  be granted. Thus all orders wherein permanency has been  granted (except award dated 1-4-1985 in IT No. 27 of 1984)  also stand set aside.”

28. In the case of  State of Maharashtra and Another  

vs.  R.S.Bhonde  and  Ors.12,  this  Court  relied  upon  earlier  

judgment in the case of Mahatma Phule Agricultural University  

12  (2005) 6 SCC 751

26

and reiterated the legal position thus:

“. Additionally, as observed by this Court in  Mahatma Phule  Agricultural University v. Nasik Zilla Sheth Kamgar Union (2001)   7 SCC 346  the status of permanency cannot be granted when  there is no post. Again in  Gram Sevak Prashikshan Kendra v.  Workmen (2001) 7 SCC 356, it was held that mere continuance  every year of seasonal work obviously during the period when  the work was available does not constitute a permanent status  unless there exists post and regularisation is done.”

29. In  the case of    Indian Drugs & Pharmaceuticals  

Ltd. vs. Workmen, Indian Drugs & Pharmaceuticals Ltd.13,  this  

Court  stated   that  courts  cannot  create  a  post  where  none  

exists.  In paragraph 37 of the report, this Court held:

“37.  Creation  and  abolition  of  posts  and  regularisation  are  purely executive functions vide P.U. Joshi v. Accountant General   (2003) 2 SCC 632. Hence, the court cannot create a post where  none exists. Also, we cannot issue any direction to absorb the  respondents or continue them in service, or pay them salaries of  regular employees, as these are purely executive functions. This  Court  cannot  arrogate to  itself  the powers of  the executive or  legislature.  There  is  broad  separation  of  powers  under  the  Constitution, and the judiciary, too, must know its limits.”

30.  In yet another case of  Divisional Manager, Aravali   

Golf  Club  and  Another vs. Chander  Hass  and Another14, this  

13 (2007) 1 SCC 408 14 (2008) 1 SCC 683

27

Court said:

“15. The  court  cannot  direct  the  creation  of  posts.  Creation and sanction of posts is  a prerogative of the  executive or legislative authorities and the court cannot  arrogate  to  itself  this  purely  executive  or  legislative  function, and direct creation of posts in any organisation.  This  Court  has  time  and  again  pointed  out  that  the  creation of a post is an executive or legislative function  and  it  involves  economic  factors.  Hence  the  courts  cannot take upon themselves the power of creation of a  post. Therefore, the directions given by the High Court  and the first appellate court to create the posts of tractor  driver  and  regularise  the  services  of  the  respondents  against  the  said  posts  cannot  be  sustained  and  are  hereby set aside.”

31. Thus, there is no doubt  that creation of posts is not  

within the domain of judicial functions which obviously pertains  

to the  executive.   It is also true that the status of permanency  

cannot be granted by the Court where no such posts exist and  

that executive functions and powers with regard to the creation  

of posts cannot be arrogated by the Courts.      However, the  

factual matrix of the present controversy reveals that it was an  

admitted  position  before  the  Industrial  Court,  Thane  in  

Complaint (ULP) No. 442/92 that the posts of cleaners in the  

Corporation were in existence.    The Industrial Court, Thane  

recorded the following findings:

“9. Undisputedly,   there  are  posts  of  cleaners  in  the  Corporation  and  not  only  these  employees  but  the  other  

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regularly  appointed  are  working  under  the  supervision  and  control  of  the  Corporation’s  officers  and  Supervisors.   The  Respondent  Corporation  has  filed  the  statement  showing  attendance of these Complainants in different depots showing  the day from which the work was allotted during the period  from 1992 to 1994.   It is at Ex.C-9.   This document is already  referred above.     Therefore,  the case of the complainants  that  they are working in different depots is not  a disputed  one.   It is for the corporation to point out how many posts are  in  the  depot  and  how many persons  are  working  in  those  depots.   Therefore,  it  cannot  be  said  that  for  want  of  any  material on record that all these persons cannot  be absorbed  in permanent posts.  When there is deliberate attempt on the  part  of  the  corporation  not  to  employ  them  as  regular  employees  in  the  posts  of  cleaners  for  years  together  the  intention is very clear and in my opinion,  this is the fit case  where the declaration under item 6 of Schedule V of the Act  will have to be given.”

32. The  Industrial Court at Bombay in its order dated  

May 2, 1995 while  dealing with Complaint (ULP) Nos.  542 and  

574/1991 on the basis of the  evidence on record recorded the  

findings thus:

“…….the employees covered by the complainants  are doing  the job of washing, cleaning buses and, the work was  done round the clock. The work at washing, cleaning buses  was  previously  done by the helpers, who in the 4th category, and their  salaries grade begins from  Rs. 875-12-1055-15-1145, whereas  the grade of Swachak, which is also in 4th category begins from  750-12-970-14-940.  These  categories  are  mentioned  in  Maharashtra  S.T.  Samachar.   It  is  the  publication  of  the  M.S.R.T.C. and, the  said document is filed in comp. (ULP) No.  574/91 along with complaint below Ex. U-4.  Schedule-A gives  salary grades of various employees.  The category of Swachhak  is at Sr. No. 1, and category of helper is at Sr. No. 15.  Therefore,  it is very clear that, the rest of Swachhak was already mentioned  in the 4th category of the schedule.   Witness examined by the  Corporation  Mr.  Deekar  has  admitted  in  his  evidence  that,  “examination” previously job which was being done by the helper  is  now  being  done  by  the  employees  covered  by  these  

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complainants.  “No further admits that, “ the helpers who were  doing  the  job  previously  were  the  regular  and  permanent  employees  of the respondent Corporation work round the clock.  He  also  admits  that,  since  the  depots  of  the  respondent  corporation work  round the clock,   these Swachhaks are also  required to work around the clock, and therefore, they are divided  in three shifts.  He admits that, even as on today, there are some  employees  in  the  Respondent  Corporation  that,  they  are  designated as Swachhak, and they are getting such higher salary  than the employees covered by the complaint.  The employees  covered by the complaints were previously paid Rs. 10.50 per  day, and the same mode of  payment was converted in the piece  rate basis.  “The witness further admitted that,  cleanliness of the  bus is incidental and part and parcel of plying,  and the buses  have to run regularly.”  It is  further admitted position that, these  employees have been in the employment of the Respondent for  last several years,  and they have been paid much less salary  when so called regular employees working as Swachhak.  They  have also been deprived the benefits of settlements and other  facilities.  The Respondents claim that they were appointed as  time gap arrangement, the Respondents have failed to show as  to how the helpers legitimately did not do the job of Swachhak.  Therefore, those employees were appointed on piece rate basis.  Presuming that, it  was the right of the respondents to appoint the  Swachhak on piece rate basis, then also, it is admitted position  that, they were asked to do the same work,  which Swachhak  employed by the Corporation were doing.  Therefore,   point  at  discrimination  has  been  made  very  much  clear  by  the  complainants.  In respect of dates of appointment and, number of  years  of  service,  the  witness  of  the  complainants  has  stated  firmly that, they are working since long time, and then the fact  regarding appointment was never disputed by the Corporation.  The  Respondent  has  admitted   record  regarding  the  appointments of employees but, they have neither produced any  record, nor contradicted the statements made by the witness of  the complainants except giving some suggestion that, they have  not worked on regular basis.  Therefore, evidence of the witness  remained unchallenged.  Hence it  is very much clear that,  the  complainant has established that, the employees covered by the  complaints are doing the job of regular  nature, and their  work  continued round the  clock,   which  were divided;  in  each  shift  being 8 hours.   It  is also already proved that,  the employees  covered under this complaint doing identical job as that of regular  Swachhak appointed by the Respondent Corporation,  and these  Swachhak got much higher salary and other benefits than, the  employees covered by this complaint.”

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33. In view of the findings  recorded by the Industrial  

Court,  Thane as well  as Industrial Court,  Bombay,  it  can be  

safely held that the posts of cleaners exist in the Corporation.  

No factual foundation has been laid by the  Corporation that the  

posts of cleaners do not exist in the Corporation,  rather the  

evidence on record reflects otherwise.

34. The question, now, remains to be seen is whether  

the recruitment  of these workers is in conformity with Standing  

Order 503 and, if  not,  what is its effect? No doubt,  Standing  

Order 503 prescribes the procedure for recruitment of Class IV  

employees of the Corporation which is to the effect that such  

posts shall  be filled up after  receiving the  recommendations  

from the Service Selection Board and this exercise does not  

seem  to  have  been  done  but  Standing  Orders  cannot  be  

elevated  to  the  statutory  rules.  These  are  not  statutory  in  

nature.   We  find  merit  in  the  submission  of   Mr.Shekhar  

Naphade,  learned  Senior  Counsel  that  Standing  Orders  are  

contractual in nature and do not have a statutory  force and  

breach of  Standing Orders by the Corporation is itself an unfair  

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labour  practice.   The  concerned  employees  having  been  

exploited  by  the  Corporation  for  years  together  by  engaging  

them on piece rate basis,  it is too late in the day for them to  

urge  that  procedure  laid  down  in  Standing  Order  No.  503  

having not been followed, these employees could not be given  

status  and  principles  of  permanency.  The  argument  of  the  

Corporation, if accepted, would tantamount to putting premium  

on their unlawful act of engaging in unfair labour practice.   It  

was  strenuously urged by the learned Senior Counsel  for the  

Corporation  that  industrial  court  having  found  that  the  

Corporation indulged in unfair labour practice in employing the  

complainants as casuals on piece rate basis,  the only direction  

that  could have been given to the Corporation was to cease  

and desist from indulging into such unfair labour practice  and  

no direction   of  according  permanency to  these  employees  

could have  been given.  We are  afraid, the argument ignores  

and overlooks  the specific power given to the Industrial/Labour  

Court under Section 30(1)(b) to  take affirmative action against  

the  erring  employer  which  as  noticed  above  is  of  wide  

amplitude and comprehends within  its  fold  a direction to  the  

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employer to accord permanency to  the employees affected by  

such unfair labour practice.  

35. Seen thus, the direction of giving status, wages and all  

other benefits of permanency applicable to the post of cleaners  

to  the  complainants, in the facts and circumstances, is justified  

and  warrants  no  interference.  Question  (one)  is  answered  

accordingly.

re. : question (two)

36. A recognised union is a union which has been issued a  

certificate of recognition under  Chapter III of MRTU & PULP  

Act.  In terms of Section 2, no employee in an undertaking to  

which the provisions of Industrial  Disputes Act apply, shall be  

allowed to appear or act or be represented  in the proceedings  

relating  to unfair  labour practices specified in items 2 and 6 of  

Schedule IV except through the recognized union.  Schedule IV  

deals with  general unfair labour practices on the part of  the  

employers. Item 6 covers unfair labour practice on the part of  

the employer to employ  badlis, casual  or temporaries  and to  

continue them as such for  years with the object  of  depriving  

them  of  the  status  and  privileges  of  permanent  employees.  

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Section 28  is a procedural provision  with regard to complaints  

relating to unfair labour practices.

37. In  the  case  of   Shramik  Uttakarsh  Sabha  vs.  

Raymond  Woollen  Mills  Ltd.  and  Others.15  this  Court  after  

extensively surveying  the provisions of MRTU & PULP Act and  

on consideration of the judgments in Girja Shankar Kashi Ram  

vs. Gujarat Spg. & Wvg. Co. Ltd.1916 ,  Santuram Khudai vs.   

Kimatrai  Printers  &  Processors(P)  Ltd,17 Workers’  Union  V.  

Balmer  Lawrie  and  Co.  Ltd.18  and   Crescent  Dyes  and  

Chemicals Ltd. vs. Ram Naresh Tripathi19 held thus:

“14.  Section  21  of  the  MRTU  &  PULP  Act,  upon  which  emphasis  was laid  on behalf  of  the appellants,  states that  no  employee  in  an  undertaking  to  which  the  provisions  of  the  Industrial Disputes Act applies shall be allowed to appear or act  or be allowed to be represented in any proceeding relating to the  unfair labour practices specified in Items 2 and 6 of Schedule IV  except through the recognised union. It is important to note that  the reference is  to  employees  in  an undertaking  to  which the  Industrial  Disputes  Act  applies  and  not  to  employees  in  an  undertaking to which the BIR Act applies. Apart therefrom, the  section  permits  an  employee,  not  a  union  other  than  the  recognised union, to so appear. The provisions of Section 21 do  not, therefore, lead to the conclusion that a union other than a  representative  union  can  appear  in  proceedings  relating  to  all  unfair labour practices other than those specified in Items 2 and  6 of Schedule IV.”

15  (1995) 3 SCC 78 16 1962 Supp (2) SCR 890 17 (1978) 1 SCC 162 18 1984 Supp. SCC 663  19 (1993) 2 SCC 115

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38. It  is important to bear in mind that the concept of  

recognition of unions has been introduced in  MRTU & PULP  

Act  with  a  view to  facilitate  the  collective  bargaining  for  the  

employees in certain undertakings. In respect of  unfair labour  

practices specified in  items 2  & 6   of  the Schedule IV,  it  is  

provided   in  Section   21   that  in  respect  of  such  items  no  

employee   in  an  undertaking  to  which  the  provisions  of  

Industrial disputes Act applies shall be allowed to appear or  act  

or  be  allowed   to  be   represented  except  through  the  

recognized  union.  The  expression,  “  to  appear  or  act   or  

allowed to be represented” in Section 21(1) is  of wide import,  

comprehensive and  embraces  within itself   the act of  filing  

complaint,  leading  evidence,  examination  and  cross  

examination of witnesses and audience before  the Industrial  

Court/Labour Court.  There is nothing to control the expression,  

“ to appear or to act or allowed to be represented”  as used in  

Section  21(1).   It  is  referable   to  all  kinds  of   acts  by  the  

recognized union   in the proceedings relating to unfair labour  

practices  specified   in  items  2  and  6  of  the  Schedule  IV.  

Section  21(1)  excludes  individual  employees,   unrecognized  

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union  or   any other  form of  association  or  union  other  than  

recognized union under MRTU & PULP Act   to appear or act or  

be   represented  in  the  proceedings  relating  to  unfair  labour  

practices specified in items 2 and 6 of  Schedule IV.    It is only  

recognized union  which has been empowered to espouse  the  

cause relating to unfair labour practices specified in items 2 and  

6 of  Schedule IV in the proceedings before Industrial/Labour  

Court.   Section  21(1)  is  a  special  provision  in  respect  of  

appearance, act and representation in respect of the complaints  

filed  under  Section  28  relating  to  unfair  labour  practices  

specified in items 2 and 6 of Schedule IV.   Section 21, thus,  

creates a bar on unrecognized union from acting,  appearing or  

representing any  employee(s) in a proceeding relating to unfair  

labour practices under items 2 and 6 of Schedule IV. The right  

to represent the employee(s)  in matters relating to unfair labour  

practices  in  items 2  and  6  of  Schedule  IV  of  the  Act  under  

Section 21 is exclusively available to the recognised union and  

none else.  

39. Learned  Counsel  for  the  unrecognized  union,  

however, relied upon a decision of the Bombay High Court in  

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the case of Petroleum Employees Union vs. Bharat Petroleum  

Corporation Ltd. and Another20.

40. In the case of  Petroleum  Employees Union, the  

learned Single Judge (S.P.Bharucha, J. as his Lordship then  

was) interpreted  Section 21 in the following manner:  

“5. The correct interpretation to place upon section  21  is  this:   Where  there  is  a  recognised  union  only  that  recognized union can be allowed,  on behalf of an employee,  to appear or; act or be represented in proceedings relating to  unfair  labour  practices  specified  in  Items  2  and  6  of  the  fourth  schedule.   Where there  is  no  recognized  union  an  employee  may  himself  appear  or  act  in  any  proceeding  relating to such unfair labour practice.  This does not mean  that  an  unrecognized  union  cannot;  act  or  appear  in  a  proceeding relating  to  such unfair  labour  practice.   It  can  represent an employee or the employee may appear himself  if he so chooses.”

41. The   interpretation  of  Section  21  in  Petroleum  

Employees  Union is  not  a  correct  interpretation   and,  with  

respect, we are unable to find ourselves in agreement with that  

interpretation.   As  a  matter  of  fact,  the  learned  Judge  (S.P.  

Bharucha,  J.  as  his  Lordship  then  was)   while  adorning  the  

bench of this Court  in the case of  Raymonds   Wool Mills Ltd.   

took    exactly  diametrically  opposite  view  with  regard  to  

Interpretation of Section 21 that we have already noticed in the  

earlier  part  of  our  judgment.   We respectfully agree with  the  20 1983 MJ 618

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view of this Court in Raymonds Wool Mills Ltd.   We hold, as it  

must be, that the unrecognized union is not competent to file a  

complaint in so far as  unfair labour practices under Item nos. 2  

and 6 of Schedule IV of MRTU & PULP Act is concerned.

42. In  what  we  have  held  above,  the  affected  

employees  in  the  two complaints   filed  by  the  unrecognized  

union may not be entitled to the benefits of permanency to the  

post of cleaners as  these complaints are not maintainable.  But  

in  the  present   fact  situation,  in  our  judgment,   it  would  be  

travesty of  justice if at this stage because of non-maintainability  

of the complaints at the instance of the unrecognized  union,  

these employees are deprived of the benefits of status, wages  

and  permanency  applicable  to  the  post  of  cleaners  when  

similarly  situated  employees  who  had  filed  the  complaint  

individually would get  benefits of permanency applicable to the  

post of cleaners.  In view of this exceptional situation, for doing  

complete justice between the parties,  in exercise of our plenary  

power under Article  142 of the Constitution of India,  although  

we have answered question(two) in favour of the Corporation  

that  the  two  complaints  filed  by  Casteribe   Rajya  P.  

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Kararmchari  Sanghthans  are  not  maintainable  in  so  far  as  

unfair  labour  practices  under  item  6  of  Schedule  IV  is  

concerned yet in the facts and circumstances of the case, we  

direct that the employees in these two complaints would also  

get  the  status,  wages  and  other   benefits  of  permanency  

applicable  to  the  post  of  cleaners  as  the  employees  in  

complaint (ULP) No. 442/92.   

43. In  what  we  have  discussed  above,  all  these  five  

appeals must fail and are dismissed with no order as to costs.

……………………J (Tarun Chatterjee)

         …….……………..J            (R. M. Lodha)

New Delhi August  28,  2009.

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