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PETITIONER: THE FACTORY MANAGER, CIMMCO WAGON FACTORY

       Vs.

RESPONDENT: VIRENDRA KUMAR SHARMA AND ANOTHER

DATE OF JUDGMENT:       26/07/2000

BENCH: S. Rajendra Babu, J. & Shivaraj V. Patil, J.

JUDGMENT:

Shivaraj V. Patil,J. Civil  Appeal  No.   4501 of 1998 is directed against  the  order dated  3-12-1997  made  by the High Court of  Rajasthan  in  D.B. Civil  Appeal No.  523/97.  Briefly stated, the facts, which  are necessary  and relevant for the disposal of this appeal, are  the following.

At  the instance of the respondent, the State Government referred the  dispute under Section 10(1) of the Industrial Disputes  Act, 1947  vide Notification No.  S.P.I.(i) (884) L.C/83 dated  1.2.84 to decide -

"whether  the  termination of service of labourer  Shri  Virendra Kumar  by  the Manager, CIMCO Limited, Bharatpur, was proper  and legal?  If not, what relief the labourer was entitled?"

The  contesting  respondent claimed that he was appointed  as  an apprentice  by the appellant from 10.9.79 to 21.9.80.  After  the expiry  of  the  said period, he was on regular  service  between 22.9.80  to 21.12.80.  As there was lock-out in the factory  from 7.10.80  to 8.2.81, he was asked by the appellant not to come for work.   After  the  lock-out was over, the respondent  worked  as General  Clerk in the assembly shop of the appellant from  9.2.81 to  30.6.82.   Thereafter he worked in the vacancy of  Shri  K.G. Venkatesan  till  April, 1983.  He was given Rs.250/-  per  month from  22.9.80  to  30.6.82 and when he demanded  salary  for  the period  between  1.7.82 to April, 1983 he was told that his  case had been recommended for approval of the higher officers.  He was told  by the appellant orally not to come for work from 16.6.1983 on  the ground that his services were already terminated.  It was his  further case that he had continuously worked from 9.2.81  to 15.4.83.  Hence he was entitled to become permanent worker.

The  appellant  resisted  the claim of the respondent  by  filing written  statement.  It was admitted that the respondent had been appointed  as  an apprentice between 10.9.79 and 22.9.80  at  the request  of  his father who was already serving in the  appellant factory.   It was pointed out that between the periods 11.8.81 to 10.12.81  and  11.12.81  to 30.6.82 the respondent  had  been  an apprentice  as per Exbts.  M2 and M1 respectively.  It was stated that  neither  the  respondent  was  employed  by  any  competent authority  in the establishment of the appellant nor he had  been paid salary.  It is clear from condition no.  5 in Exbts.  M1 and M2  that  the  appellant  was  not obliged to  give  job  to  the respondent  after  the completion of apprenticeship.  The  Labour Court  after  considering the rival contentions, in the light  of

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the  evidence brought on record, held that the respondent was not a  workman.   It also held that presumption that could be  raised under  Section  103  of the Factories Act, 1948  (for  short  the ‘Act’)  stood rebutted as no appointment letter was given to  the respondent;  he was neither paid any salary or wages and that the relationship  of  master  and servant did not exist  between  the appellant and the respondent.  In view of the conclusions arrived at, the Labour Court passed the award holding that the respondent was not entitled to any relief from the appellant.

The  respondent  challenged the validity and correctness  of  the said  award  in the High Court of Rajasthan in S.B.   Civil  Writ Petition No.  1384/87.  The learned Single Judge did not find any good  ground  to  disturb the award passed by the  Labour  Court, exercising  jurisdiction under Article 226 of the Constitution of India.   Consequently, the writ petition was dismissed on 6.3.97. The respondent took up the matter in appeal in D.B.  Civil Appeal No.   523/97.   The  Division  Bench of the  High  Court  by  the impugned  order  dated 3.12.97 allowed the appeal, set aside  the order  of the learned Single Judge and allowed the writ  petition quashing  the  award of the Labour Court.  Hence this  appeal  is brought before us by the appellant.

The  learned  counsel for the appellant urged that  the  Division Bench  of  the High Court failed to see that the  respondent  was only an apprentice for short period in two spells;  that too with a clear understanding that the appellant was not bound or obliged to  give  him  job in the establishment;  he was  only  taken  as apprentice  at the request and persuasion of his father to  train him,  who  was already an employee in the appellant factory;   he was only paid stifund of Rs.  250/- per month;  neither there was any  appointment  order  issued nor any salary was  paid  to  the respondent  by  the  appellant;  the documents placed  on  record clearly  show  that  he was only an apprentice  and  the  letters relied on by him given by the officer, who was not the appointing authority,  contained only recommendations.  The learned  counsel added  that  the presumption raised by the Division  Bench  under Section  103  of  the  Act was clearly  erroneous  and  the  said provision has no application to the case of the respondent.

On  the other hand, the learned Senior Counsel for the respondent argued  in  support and justification of the impugned order.   He laid  stress on the two letters dated 22.1.83 and 7.5.83  written by one Shri S.G.Goyal, Dy.  Manager to the Vice- President of the appellant  factory  and argued that the respondent was  regularly employed by the appellant.  Under the circumstances, according to the  learned Senior Counsel, the learned Single Judge of the High Court  was right in quashing the award passed by the Labour Court and granting relief.

The  facts  that are not in dispute are that the  respondent  was taken as an apprentice for the given periods in Exbts.  M1 and M2 referred  to in the award.  He was paid a monthly stifund of  Rs. 250/-  during  the  apprenticeship period.  Annexures M1  and  M2 contained  a clause that after the expiry of the training period, the  appellant  company  shall not be under  obligation  to  give employment  to the respondent.  The respondent had signed  Exbts. M1  and M2 after carefully going through the terms and conditions contained in them.  There was no appointment letter issued to the respondent  and no material was placed before the Labour Court to show that any salary was paid to the respondent at any time apart from the stifund of Rs.250/- per month.

The  Labour  Court in the award, on analysis and appreciation  of the  evidence  brought before it, refused to grant any relief  to

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the  respondent.   It is stated in the award that the  respondent worked between 22.9.79 and 21.8.80 and from 11.8.81 to 30.6.82 as only an apprentice as per Exbts.  M1 and M2.  Shri Goyal, the Dy. Manager,  had  admitted  that  the respondent  worked  as  a  Co- ordinator with the appellant which is clear from Exbts W7 and W8. These  two  letters  revealed  that he had  recommended  for  the appointment of the respondent.  The Labour Court had also noticed that  the  respondent  had neither been employed by  a  competent authority  nor was he paid salary.  It was also noticed that  the respondent was neither under any compulsory obligation to undergo training  nor  he  could  be compelled to do  so.   May  be,  the respondent  did  not give up training and continued working as  a Co-ordinator  in anticipation of being provided employment as his father  was  also  an  employee in the  factory.   There  was  no evidence  on  record  to  indicate that either GPF  or  ESI  were deducted  from  the salary of the respondent as he was not  being paid any salary.  Having regard to the evidence placed on record, the  Labour Court held that the respondent was not a workman.  As regards the presumption to be drawn under Section 103 of the Act, the  Labour Court observed that such a presumption was put to  an end  by the facts of the case as the respondent was not given any appointment  letter;  he was neither paid any salary or wages and that  the  master and servant relationship did not exist  between the parties.  As per clause 5 of Exbts.  M1 and M2, the appellant was  not  bound to give employment to the respondent.  It may  be added  here that the letter Exbt.  W-6 (Annexure R1/8 produced in this  appeal)  written by the respondent himself shows  that  his services  came  to an end on 30.6.82.  If that be the  case,  his claim that he continued in the service as a regular employee till April, 1983 is not acceptable.

The  learned  Single  Judge looking to the award  passed  by  the Labour Court has observed that the respondent was continued as an apprentice for a period of two years in the appellant company and beyond that his services were not extended by the appellant.  The learned  Single Judge did not find any illegality, impropriety or perversity in the award.  The learned Single Judge also proceeded to say that not a single document was placed on record from which it  could  be  established  that the  respondent  was  a  regular employee.   In  this view, the learned Single Judge  declined  to exercise  jurisdiction  under Article 226 of the Constitution  of India and dismissed the writ petition.

The  Division  Bench  of  the High Court in  the  impugned  order referred  to Exbts.  W7 and W8 to hold that the respondent was  a workman.  From a plain reading of these letters, it is clear that they  are only recommendatory.  It is also brought on record,  as observed  by  the Labour Court that Shri Goyal was not  competent authority  to  give any appointment.  The Division Bench  in  the impugned order has stated thus:

"Though  it is true that no appointment letter has been issued to the  writ  petitioner,  nor  any payment was  made  to  the  writ petitioner,  but  still  it is the established fact that  he  was asked to work in the factory by the authorities."

Assuming  that the respondent was asked to work in the factory in anticipation  of securing employment, that too by an officer  who was  not  competent  to  give   appointment,  did  not  make  the respondent  workman  or  a  regular  employee  of  the  appellant company.   We  have no hesitation to say that the Division  bench was not right in raising presumption under Section 103 of the Act in  order to say that the respondent was a workman in relation to an  industrial dispute for the purposes of any proceedings  under the  Industrial Disputes Act, 1947.  Section 103 of the Factories

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Act, 1948 reads as under :-

"103.   Presumption as to employment - If a person is found in  a factory  at any time, except during intervals for meals or  rest, when  work  is going on or the machinery is in motion,  he  shall until  the contrary is proved, be deemed for the purposes of this Act  and  the  rules made thereunder to have been  at  that  time employed in the factory."

(Emphasis supplied)

The  presumption available under this Section in the first  place is rebutable and secondly it is available only for the purpose of the  said  Act.  It is also not the case of the  respondent  that this presumption is made available in relation to an adjudication of  a  dispute  referred to under Section 10  of  the  Industrial Disputes  Act,  1947.   Section  103 of the Act  is  included  in Chapter  X  under  the heading "Penalties  and  Procedure"  which chapter  deals  with general penalty for offences,  liability  of owner  of  premises  in certain circumstances,  enhanced  penalty after  previous conviction etc.  The Act provides for the health, safety,  welfare,  and other aspects of worker in factories.   It was enacted to consolidate and amend the law regulating labour in factories.   The  presumption  under Section 103 of  the  Act  as already noticed above is to be raised for the purpose of the said Act.  Even otherwise on the material placed on record when it was factually  established  that  the respondent was not  a  workman, raising  a presumption under Section 103 of the Act in his favour was  not  correct.   At  any  rate there  were  no  good  reasons sustainable  in law to upset the finding of fact recorded by  the Labour  Court based on the evidence placed on record after proper appreciation of the same and more so when the award of the Labour Court was affirmed by the learned Single Judge.  Having regard to the  facts,  circumstances  of the case and in the light  of  the evidence  placed  on  record, it is not possible to  accept  that there  was any unfair labour practice as observed in the impugned order.   Thus  in  view  of  what is stated  above,  we  find  it difficult  to  sustain the impugned order.  Hence the  appeal  is allowed.   The  impugned order is set aside and the award of  the Labour Court is restored.

The   Division   Bench  of  the   High  Court   while   directing reinstatement of the respondent in service had ordered payment of 25%  of  the back-wages.  The respondent aggrieved by  denial  of full  back-wages,  has filed Civil Appeal No.  5408/98.   In  the light  of  the conclusions arrived at by us in Civil  Appeal  No. 4501/98, this appeal is dismissed.  There shall be no order as to costs.