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CASE NO.: Appeal (civil) 3747  of  1998 Appeal (civil)  3748     of  1998

PETITIONER: THE MANAGING DIRECTOR, A.P.  STATE ROAD TRANSPORT CORPORATION

       Vs.

RESPONDENT: THE PRESIDING OFFICER INDUSTRIAL TRIBUNAL, RAMKOTE, HYDERABAD & ORS.

DATE OF JUDGMENT:       01/02/2001

BENCH: S. Rajendra Babu & S.N. Variava

JUDGMENT:

J  U  D  G  M  E  N  T RAJENDRA BABU,   J. :

L...I...T.......T.......T.......T.......T.......T.......T..J     The  transport  wing of Tirupathi  Tirumala  Devasthanam (for  short T.T.D.] was transferred to the Andhra  Pradesh State   Road   Transport  Corporation    (for   short   the Corporation]  under  an agreement dated 8.8.1975.   It  was provided in the agreement that 850 workmen to be transferred to  the  Corporation.   The transfer of the workmen  to  the Corporation  was challenged in a writ petition No.  1361  of 1976  but  it was dismissed on 13.7.1977 and a  writ  appeal filed  against the said judgment was also confirmed.   While some  of the transferred T.T.D.  transport workers who opted to come under the Corporation Rules and Regulations were not before the court, the other workers wanted to maintain their separate  identity  in  spite  of   their  transfer  to  the Corporation  and  so  they  did not opt to  come  under  the Corporation  Rules  and  Regulations.    Subsequent  to  the transfer  certain settlements had been entered into with the Corporation  by the Union of the workmen from time to  time. The  members of the Union made a demand that under clause 13 of  the transfer agreement dated 8.8.1975 they were entitled to the benefits which accrued to the present T.T.D.  workers after  8.8.1975  but the Corporation did not agree for  such demand,  an industrial dispute was raised which was referred to  the Industrial Tribunal (hereinafter referred to as the Tribunal] under Section 10(1)(d) of the Industrial Disputes Act  (for  short the Act].  The question referred  to  the Tribunal reads as follows :-

   Whether   the   former   transferred  T.T.D.    workers (presently  the APSRTC workers) are entitled to the benefits accrued to the present T.T.D.  workers after 8.8.75 in terms of the agreement dated 8.8.75.  If so, to what extent?

   After  notice  the  representatives of  the  Union,  the Corporation  and  the T.T.D.  filed their  statements.   The Union  raised  several  questions   although  the   question referred  to the Tribunal was with reference to the benefits that  have  accrued to the present T.T.D.  workers would  be

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applicable to the erstwhile T.T.D.  workers or not.  In view of  the several claims made before the Tribunal the scope of the  reference was to be considered.  The Tribunal  examined various contentions and raised certain issues which are :

   1.  Whether the second respondent TTD represented by its Executive  Officer  is a proper and necessary party in  this industrial dispute?

   2.   Whether  the  members of the petitioner  Union  are entitled  to  the  benefits conferred on the  TTD  employees subsequent to 10.8.1975 merger?

   3.   If  any relief is to be granted in this  industrial dispute against whom should the award be passed?

   4.  To what relief?

   The  Tribunal  noticed that clause 11 of  the  agreement indicated  that  the  T.T.D.  reserved its right  to  retain vehicles,  equipment  and other assets as required  by  them along  with the required number of workers to operate  them. Clause  13 stipulated that all the remaining workmen working in   the  transport  undertaking  of  the  T.T.D.    without interruption  in their service are taken by the  Corporation and protection is given in pay and allowance, provident fund contributions  and gratuity in terms of Section 25FF of  the Act and T.T.D.  agreed to pay such compensation if any as is liable  to be paid to workmen who do not opt to serve  under the  Corporation.   Under clause 14 arrangement is made  for retirement  benefits,  provident fund and  gratuity.   Under clause 15 T.T.D.  agreed to continue to permit the employees to  continue to reside in their quarters subject to  certain conditions.   Pursuant  to the take over there was  complete cessation  of legal relationship between the members of  the Union  and  the T.T.D.  and after 10.8.1975 these  employees have  entered  into various agreements and settlements  with the  Corporation  and the T.T.D.  was not a party  to  those agreements  and none of these workers opted to be retrenched and  claimed  compensation  from the  T.T.D.,  the  Tribunal confined  the dispute only as against the Corporation.   The entire   transport  wing  had  been   handed  over  to   the Corporation and, therefore, Section 25FF of the Act would be applicable.   But the workmen also exercised their option in the  form  indicated in Ex.M9 in which they have to give  an undertaking  that  they shall abide by the rules of  RTC  in force  from time to time subject to the workmen rights under Section  25FF  of  the Act.  This option form  was  provided pursuant  to  a  writ petition No.  4456 of  1975.   In  the circumstances,   the  Tribunal  found   that  having   given categorical  undertaking that they would abide by the  rules and  regulations of the Corporation in force, it is not open to  the  members of the claimant Union to now  contend  that they  continued  to  be governed by the  T.T.D.   rules  and regulations and they continue to be employees of the T.T.D.. Therefore,  the Tribunal held that they are not entitled  to claim  benefits which conferred by the T.T.D.  Management on its  employees  subsequent  to  10.8.1975.   However,  after rejecting  several  other  reliefs   claimed,  the  Tribunal granted the following four reliefs :-

   (1)  Pay  in the selection grade will have to  be  fixed taking 1.1.1975 as the crucial date.

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   (2) Regarding promotions, it held as under :

   if   and  when  the  workers   opt  to  be  governed  by A.P.S.R.T.C.   Regulations then they may be given promotions taking  into  account their total service and the  seniority including the TTD services.

   (3) The facility for bus tour on concessional hire, and

   (4) Ex gratia bonus should be paid to the members of the claimant Union on the same basis on which ex gratia bonus is paid to other employees of the RTC.

   The  matter  was  carried in writ petition to  the  High Court  and the High Court by its order made on 3.12.1996 did not  interfere  with the award made by the Tribunal.  It  is only  in  regard  to these four reliefs that  arguments  are addressed before us.

   In  this Court the contentions urged before the Tribunal and the High Court are reiterated that the question referred to  the Tribunal being of a limited character as to  whether the  benefits accruing to the present T.T.D.  workers  could be  extended  to the employees of the transport wing or  not and  having answered that the said employees have all  opted for  being governed by the Corporation rules and regulations and  other  service  conditions, it is not open to  them  to claim those benefits.

   So  far as the first question raised before us regarding selection  grade is concerned, it is noticed by the Tribunal that  selection  grade  has  been  given  with  effect  from 1.1.1974  restricting the monetary benefits to be given only from  1.1.1978;  that the orders were actually issued in the year  1976, and that the Corporation had agreed to safeguard the  conditions  of  service of the workers.   The  Tribunal further  noticed  that the claim in that regard was  pending consideration   before  the  take   over   and,   therefore, restricting  the  monetary  benefits to be given  only  from 1.1.1978  was  not justified and the monetary benefits  will have  to  be  given with effect from 1.1.1975.   This  claim appears  to us has been rightly allowed by the Tribunal  and thus calls for no interference.

   So  far  as ex gratia bonus is concerned, on an  earlier occasion  this  question has been raised and the matter  had reached  this  Court in Civil Appeal No.  4693 of  1984  and this Court disposed of the matter on 23.11.1984 stating that the  parties had agreed that on payment of Rs.  7,50,000  by the  respondents  to the petitioners within six  weeks  from that  day  as ex gratia payment the disputes raised  by  the workmen  of the transport wing which was the subject  matter of  that  appeal should be treated as settled  and  resolved completely.  The direction of the Tribunal in this regard is that  ex gratia shall be paid to the members of the claimant Union  on the same basis on which ex gratia is paid to other employees  of the RTC.  Inasmuch as the employees working in the  transport wing have now opted to be governed by the RTC regulations  and other service conditions, the Tribunal held that  they  should  be  treated at par from  the  year  1986 onwards  and they should be given similar benefits that have been  given to the other RTC workers earlier.  Therefore, we find,  this  finding  recorded by the Tribunal  also  to  be justified.

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   So far as the claim for bus tour on concessional rate is concerned,  although original concessional rate was @ Rs.  1 per  kilometer  ,  the  Tribunal  fixed  at  Rs.   2.50  per kilometer  for  the years 1985 onwards till the  Corporation changes the rate of hire under Section 9A of the Act and the Tribunal  adopted as a rule of thumb and with a view to find out  an  equitable  solution  for the  dispute  between  the parties.  Inasmuch as the Tribunal had found that unilateral alteration  of  hire  rate to Rs.  4 per kilometer  was  not justified  adopted  the rule of thumb, we do not think  that the  discretion exercised by the Tribunal in this regard  is improper.

   Now  the  only question for consideration before  us  is with regard to the direction given by the Tribunal regarding promotion  of the employees.  The Tribunal noticed that  the difficulty  in regard to promotion had arisen on account  of the  fact  that  employees  in the  transport  wing  of  the Corporation who were erstwhile employees of the T.T.D.  were retrenched to go out of station and, in fact, those who were promoted and posted out of station came back to Tirupathi by giving up benefit of promotion.  In these circumstances, the Tribunal  felt  that  if  and when the  workers  opt  to  be governed  by  the  RTC regulations then they  may  be  given promotions  taking into account their total service and  the seniority  including  the T.T.D.  services.  This  direction would  give  rise to a lot of difficulties in  the  services inasmuch  as  several others have already been promoted  and given  that  benefit  and now to consider the cases  of  the members  of the Union for promotion would lead to  anomalous results  that apart from financial burden that will arise in the  case.   Therefore,  all that could be done  now  is  to consider  the cases of these employees for promotion as  and when  vacancies arise bearing in mind whether their  juniors have been promoted earlier or not.  In such cases, since the workmen in the transport wing have also opted to be governed by the RTC regulations, their cases will have to be examined for promotion but where promotions had already been given to others the same cannot be disturbed.  Notional promotion may be  given to them without any monetary benefits and suitable adjustments  in  seniority be made.  Direction of this  sort given  in  modification of the award of the  Tribunal  would meet  the  requirements of justice.  We  order  accordingly. Shri  Nageswara Rao pointedly addressed that direction given by  the  Tribunal is far beyond the scope of the  reference. The  question  referred to the Tribunal though worded as  to the  cover applicability of conditions of service in  T.T.D. to  the members of the respondent Union, what was really  in issue  is as to what conditions of service are applicable to them  after  they  exercised their option to  abide  by  the Corporation  regulations,  and thereafter both parties  have raised pleadings and adduced evidence.  Hence, we cannot say that the Tribunal travelled beyond the scope of reference.

   Subject  to  the  modification of the  award  as  stated above, the award made by the Tribunal is upheld as confirmed by  the High Court.  In the circumstances, the appeals  are, therefore,  partly  allowed.  The parties are left  to  bear their respective costs. IN THE SUPREME COURT OF INDIA

CIVIL  APPELLATE   JURISDICTION

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CIVIL  APPEAL NO. 3748  OF   1999

M/s L & T Mc Neil Limited                               Appellant

                                  Versus

Government of Tamil Nadu                                Respondent

WITH CIVIL APPEALS NOS. 3808/2000, 3809/2000, 1043/2000, 3727/2000 AND 5307/2000

                       J  U  D  G  M  E  N  T

RAJENDRA BABU,  J.  :

       The Government of Tamil Nadu issued a notification under Section 10(1) of the Contract Labour (Regulation & Abolition) Act, 1970 [hereinafter referred to as  the Act] prohibiting the employment of contract labour in the process of sweeping and scavenging in the establishments/factories which are employing 50 or more workmen. This prohibition is without reference to class of establishment which is involved or the conditions of work in a particular establishment.   Under Section 10 of the Act the Government is obliged to consult the Tamil Nadu State Contract Labour Advisory Board [for short the Board] before issuing a notification in question.   The appellants contended that there has been no effective consultation with the Board inasmuch as the only occasion when this aspect was considered was in the Sub-Committee meeting of the Board.   The Minutes of the meeting made available to the Court disclosed that it recorded the views of the All India Manufacturers Organisation to the effect that the sweepers and scavengers work not for more than 2 to 3 hours daily and the view of the employees representatives was that sweepers and scavengers are working for more than 120 days in a year.  No decision as such was made but it was noted that the Government should take a decision in the matter.  The said notification was challenged before the High Court in a writ petition.   The High Court, following its earlier decision in Bharat Heavy Electricals Limited   v.   Government of Tamil Nadu and Ors.,  1997 (3) LLN 495, dismissed the writ petition holding that the notification had been issued after fully complying with the prescribed procedure under Section 10 of the Act to prohibit employment of contract labour after proper consultation with all relevant parties and evaluation of all relevant factors and materials by the State Government.   Following this aforesaid decision, the writ petition filed by the petitioner also stood dismissed.  Hence these appeals.

       The Division Bench of the High Court in the course of its order noticed that apart from Sub-Committee report, to which reference has been made, the Minutes of the 17th Meeting of the Board also disclosed that the Board had elaborately considered the matter with reference to the question of issuing a draft notification abolishing contract labour system in sweeping and scavenging among other nature of work and though it appeared that a further consideration by the Government was suggested during the course of deliberations, the Board did not appear to have thought any need for further consideration. On that basis the Division Bench took the view that since the matter had been left for consideration of the Government by the Board with its report and Government had also considered the need and necessity in the light of the requirements of the law as enumerated under Section 10(2) of the Act to issue the notification in question, there is no justification to interfere with the notification in question.  Whereas  at the time when the learned single Judge considered the matter the report of the Sub- Committee was not available at all.

       Before us in these appeals against the order of the High Court what is principally contended is that  (i) there is no effective consultation with the Board by the Government

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before issuing the notification in question, and (ii) the Government did not have any relevant material otherwise and, therefore, in the absence of relevant material the Government could not have issued any notification and  thus calls for interference at our hands.

       Consultation does not mean concurrence and the views of the Board are ascertained for the purpose of assisting the Government in reaching its conclusion on the matter one way or the other.   The Government reached the conclusion on the basis of notings made on various aspects and the aspects taken note of by the Government are as follows :-

a) Whether the process, operation     or other work is incidental to,     or necessary for the industry     trade, business manufacture     or occupation that is carried     on in the establishment.                    Yes

               b) Whether it is of perennial nature,                     that is to say, it is of sufficient                     duration having regard to the nature                     of industry, trade business                     manufacture or occupation carried                     on in that establishment.                   Yes

               c) Whether it is done ordinarily through    Can be done                     regular workman in that                      through                     establishment or an establishment        regular                     similar thereon.                            Workmen

               d) Whether it is sufficient to employ                     considerable number of whole                     time workmen.                                    Yes

       What is set out in this format is what is contained in Section 10 of the Act and is  a mere repetition of the expression used therein.   The questions posed indicate the provisions contained in the Section, while answers given thereto are by monosyllables and it is not clear from the record available as to whether the same were based on any material.   In the 16th Meeting of the Board, it is noted that the members were also informed that as far as sweepers and scavengers were concerned the matter would be examined and necessary proposals sent to Government.  In the 17th Meeting of the Board, it was noted that various Sub-Committees have been formed in different industries such as (a) Cement, (b) Paper,  (c) Textiles, (d) Chemicals and (e) Electricity Board and thereafter the draft notification abolishing contract labour system in sweeping and scavenging was taken up for consideration.   While the view expressed on behalf of the Management is that the sweepers and scavengers are not having 8 hours of work but they work not more than 2 or 3 hours a day and since employing permanent workmen is not economically viable,  they are employing contract labour in this type of work and, therefore,  the Government needed to examine whether the requirements of Section 10(2)(a) to (d) of the Act have been fulfilled before finalising the notification.  While th e representatives of  the All India Trade Union Congress (AITUC) took the stand that if the work is done for more than 120 days it has to be considered as being of intermittent nature and also stated that because of the contractual nature of the work they cannot fully get benefits of employment.   The Chief Engineer of the Tamil Nadu Electricity Board pointed out that regular workmen are not willing to do this type of work and requested the Government not to proceed with the notification. The representative of AITUC stated that no further examination is necessary by the Board and notification could be issued. His view was supported by another member representing Hind Mazdoor Sabha (HMS). The Chairman stated that the Government should take a decision in the matter.

       Thus, it is clear that no definite view was expressed by the Board in this regard. The fact that the Board had been consulted in the matter is indisputable. So also the fact

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that no decision was taken by it.  Therefore,  we asked the learned counsel for the State of Tamil Nadu to make available the necessary files leading to the draft notification and final notification and other materials that were relied upon in issuing the notification in question.   Even after careful perusal of these files, we found that there is no further or fresh material available in these files.   In the circumstances,  it is not very clear as to  how the Government could have reached the conclusion one way or the other in the absence of any advice by the Board and in the absence of any other material.   The decision of the Government in issuing the notification under Section 10(1) of the Act is thus vitiated because of non-consideration of relevant materials. The mere fact that several notifications have been issued in relation to contract labour or that system in sweeping and scavenging has been abolished in some other industries may not, by itself, be sufficient to hold that a common notification applicable to all industries and establishments abolishing contract labour in sweeping and scavenging could have been issued by the Government without necessary material.   The Government ought to take into consideration the relevant factors contained in Section 10(2)(a) to (d) of the Act and thereafter decide the matter.  These aspects were, however, lost sight of by the High Court in the decisions rendered by it earlier.

       In the circumstances,   we have no hesitation in quashing the notification issued by the Government of Tamil Nadu.   However, it is made clear that it is open to the Government to issue a fresh notification after due consideration of the matter in accordance with law.

       The appeals stand allowed accordingly.

                                               ..J.                                                 [S. RAJENDRA BABU ]

                                               ..J.                                                 [ S.N. VARIAVA ]

NEW DELHI JANUARY  30, 2001. 6

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