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PETITIONER: MANAGEMENT OF M/S. PURI URBAN COOPERATIVE BANK

       Vs.

RESPONDENT: MADHUSUDAN SAHU AND ANR.

DATE OF JUDGMENT29/04/1992

BENCH: PUNCHHI, M.M. BENCH: PUNCHHI, M.M. SHARMA, L.M. (J)

CITATION:  1992 AIR 1452            1992 SCR  (2) 977  1992 SCC  (3) 323        JT 1992 (3)   290  1992 SCALE  (1)1059

ACT:           Industrial Disputes Act, 1947:      Section 2(s)-Appraiser engaged by Bank for weighing and testing  gold  ornaments  brought  to  Bank  for   pledging- Remuneration  on commission basis-No relationship of  master and servant-Whether a workman.

HEADNOTE:      The respondent was engaged as an appraiser by appellant bank, for weighing and testing, gold ornaments offered to be pledged  to  the appellant-Bank to  secure  loans,  whenever required on commission basis.  His services were  terminable at  any  time.  After about one year and  seven  months  the appellant Bank terminated his services.  On a reference from the  Government,  at  the instance of  the  respondent,  the Labour Court set aside the termination order, holding it  as illegal  and  unjustified and ordered his  reinstatement  in service.  However, it held that he was not entitled to  back wages since those were not capable of a precise  computation and involved an element of speculation.      On  appeal  by both the appellant-Bank as well  as  the respondent,  the High Court affirmed the view of the  Labour Court.      In  the  appeal  before this Court  on  behalf  of  the appellant-Bank,  it was contended that though the  appellant might be a workman as commonly understood unless there was a jural  relationship  of  master  and  servant  between   the respondent  and  the  Bank,  he could not  be  termed  as  a workman,  for the purposes of the Industrial  Disputes  Act, 1947.      Allowing the appeal, this Court,      HELD: 1.1. Though the respondent claims to be a workman as  commonly under stood, he was not ‘employed’ as such,  so as  to  establish a master and servant  relationship,  which could warrant a re-union in the event of disruption, by  the intervention of the Labour Court. [980 H, 981 A]                                                        978      1.2.  Engaging  the respondent was to  require  him  to weigh the ornaments brought in the Bank for pledging and  to appraise  their  quality,  purity and value.   He  could  be directed to do this, but not the manner in which he shall do

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it.  That was left to him exclusively, as it depended on his skill,  technique and experience.  Besides, under the  terms of engagement he was required to, and he did, execute a bond indemnifying and holding himself responsible to the Bank for all  his  acts  and  commissions as  an  appraiser,  and  be accountable for the loss sustained by the Bank on account of under-valuation  of the gold pledged with it.   These  terms inhered in the Bank the power to warn him and to remind  him that he was not expected to be negligent in his duty.  Still there  was  a fair element of freedom  though  coupled  with responsibility for the respondent in the manner in which  he could do his work.  [980 F-G]      1.3.  It  is also an uncontroverted position  that  the respondent   was  a  reputed  goldsmith  and  had   remained gainfully  employed so as to disentitle him any  back  wages and that the Bank has, on its approved list, other such like appraisers  and it was not obligatory for the Bank to  allot work to the respondent or any other, at all.   Additionally, in no event can he ask for work, or periodic remuneration or idling wages.  These particulars, not by themselves, but  in the  totality  of circumstance indicate lack of  master  and servant relationship.  [981 B]      1.4. In the circumstances, the courts below were  wrong in  holding that any master and servant  relationship  stood established  in engaging the respondent as an  appraiser  of ornaments. [981 C]      D.C. Works Ltd. v. State of Saurashtra, AIR 1957 SC 264 and  Chintaman  Rao  v.  State of M.P.,  AIR  1958  SC  388, referred to.

JUDGMENT:      CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1813 of 1992.      From  the  Judgment and Order dated  14.3.1991  of  the Orissa High Court in OJC No. 1483 of 1985.      Narasing  Murthy, Kirti Mishra and Sanjib Das  for  the Appellant.  The Judgment of the Court was delivered by      PUNCHHI,  J. In this matter challenge has been made  to the judg-                                                        979 ment  and  order dated 14.3.1991 of the  Orissa  High  Court passed  in  OJC  No. 1483 of 1985.   Notice  was  issued  to Madhusudan   Sahu,   respondent,   the   person   concerned, indicating  that  the  matter shall be disposed  of  at  the notice stage.  Despite presumptive service, no one  appeared on  his  behalf.   We heard only  learned  counsel  for  the appellant.      Special leave is granted.      The respondent, Madhusudan Sahu thereafter referred  as "Sahu")   was  engaged  as  an  appraiser  by   Puri   Urban Cooperative  Bank,  the  appellant herein,  pursuant  to  an advertisement  dated January 10, 1978.  As an appraiser  his job  was  to  be available in the  Bank,  when  called,  for performing  the  services of weighing and testing  the  gold ornaments offered to be pledged to the Bank to secure loans. It was stipulated in the advertisement that the  appraiser’s commission  (termed  wages by the High Court)  shall  be  25 paisa  per  hundred  rupees of loan but  in  no  case  shall remuneration be less then Rs. 2 per appraisal.  Besides  the said  commission/wages the  appraiser could claim  no  other sum  for his services.  As stipulated, Sahu’s services  were terminable at any time.  His services were terminated by the Bank on 27.8.1979.  He successfully sought a reference  from

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the  Government to the Labour Court.  The Labour Court  went into  the  matter and vide Award dated March 27,  1985,  set aside  the  order of termination terming it as  illegal  and unjustified,  ordering Sahu’s reinstatement in service.   He was  held  disentitled to back wages since  those  were  not capable of a precise computation and involved an element  of speculation.  The appellant-Bank as well as Sahu  approached the  High  Court of Orissa challenging  correspondingly  the Award  of  the Labour Court insofar as it had  gone  against their  respective  interests.  The High Court  affirmed  the view  of  the  Labour Court, which has given  cause  to  the appellant-Bank to move this Court.      The  High  Court  has has taken the view,  as  did  the Labour  Court, that Sahu is a worker as defined  in  Section 2(s) of the Industrial Disputes Act, 1947 and on that  basis alone  entitled  to reinstatement.  The word  ‘workman’  has been  defined  therein  to mean  any  person,  including  an apprentice,  employed  in  any industry to  do  any  manual, unskilled,  skilled,  technical,  operational,  clerical  or supervisory  work for hire or reward, Whether the  terms  of employment  be  express or implied.  That does  not  include inter                                                        980 alia   persons   employed  in  supervisory  in   supervisory capacity  drawing wages exceeding Rs. 1600 per  mensem  etc. Due  to  the wide amplitude of the definition  of  the  word ‘workman’  the  High Court endorsed the view of  the  Labour Court  that  Sahu  was a workman and thus  came  within  the definition,  and was thus entitled to the protection of  the Industrial Disputes Act, 1947.      It  was contended on behalf of the appellant  that  the appellant may be a workman as commonly understood, but  work of  appraising in the context is partly manual, as goes  the weighing  part,  and partly mental, as goes  the  appraising part,  wholly  or  partially skilled  and/or  technical  and Wages/commission   for  that  work  may  fall   within   the expression ‘hire or reward’.  Still, it is maintained,  that unless there was a jural relationship of master and  servant between  Sahu  and  the Bank, he could not be  termed  as  a workman,  for the purposes of the Industrial  Disputes  Act, 1947. It stands established that Industrial Law revolves  on the axis of master and servant relationship and by a  catena of  precedents  it stands established that the  prima  facie test of relationship of master and servant is the  existence of the right in the master to supervise and control the work done by the servant (the measure of supervision and  control apart)  not  only in the matter of directing what  work  the servant  is to do but also the manner in  which he shall  do his  work.  See in this regard D.C. Works Ltd. v.  State  of Saurashtra,  AIR  1957  SC  264 at p.  264  at  p.  268  and Chintaman  Rao v. State of M.P., AIR 1958 SC 388  at  p.392. And this principle holds the field.      Now  engaging  Sahu was to require him  to  weight  the ornaments  brought in the Bank for pledging and to  appraise their quality, purity and value.  He could be directed to do this  but not the manner in which he shall do it.  That  was left  to  him  exclusively, as it  depended  on  his  skill, technique  and  experience.   Besides  under  the  terms  of engagement  he was required to, and he did, execute  a  bond indemnifying and holding himself responsible to the Bank for all  his  acts  and  commissions as  an  appraiser,  and  be accountable for the loss sustained by the Bank on account of under-valuation  of the gold pledged with it.   These  terms inhered in the Bank the power to warn him and to remind  him that he was not expected to be negligent in his duty.  Still

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there  was  a fair element of freedom  though  coupled  with responsibility, for Sahu in the manner in which he could  do his work.      Therefore,  we are of the view that though Sahu  claims to  be  a  workman  as  commonly  understood,  he  was   not ‘employed’ as such, so as                                                        981 to establish a master and servant relationship, which  could warrant  a  re-union  in the event  of  disruption,  by  the intervention  of  the Labour Court.  The allegation  of  the Bank before the Labour Court, as well as here, that Sahu  is a  reputed goldsmith and had remained gainfully employed  so as  to disentitle him any back wages, which appealed to  the Labour  Court,  has remained uncontroverted before  us.   It also remains uncontroverted before us that the Bank has,  on its approved list, other such like appraisers and  it is not obligatory for the Bank to allot work to Sahu or any  other, at  all.  Additionally, in no event can he ask for work,  or periodic  remuneration or idling wages.  These  particulars, not  by  themselves, but in the  totality  or  circumstances indicate lack of master and servant relationship.      In  view of these jurisdictional facts, as gathered  by us,  it is difficult  to uphold the view of the  High  Court and  that  of the Labour Court that any master  and  servant relationship  stood  established  in  engaging  Sahu  as  an appraiser of ornaments.      For these reasons this appeal is allowed, setting aside the  orders  of  the High Court of Orrisa and  that  of  the Labour Court, but without costs. N.P.V.                                       Appeal allowed.                                                        982