1995 (12) TMI 341 - SC - Indian Laws

Court upholds orders for worker permanency, dismisses appeals challenging decision on labor law exemptions.

CHIEF CONSERVATOR OF FORESTS& ANOTHER, ETC. Versus JAGANNATH M

CHIEF CONSERVATOR OF FORESTS& ANOTHER, ETC. Versus JAGANNATH M - 1996 AIR 2898, 1996 (2) SCC 293 Issues Involved:1. Whether the Forest Department of the State Government is an 'industry' under section 2(j) of the Industrial Disputes Act, 1947.2. Whether the State Government indulged in unfair labor practices as per item 6 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971.3. Whether the directions given by the Industrial Courts need interference.Issue-wise Detailed Analysis:1. Whether the Forest Department of the State Government is an 'industry' under section 2(j) of the Industrial Disputes Act, 1947:The primary question was whether the Forest Department qualifies as an 'industry' under section 2(j) of the Industrial Disputes Act, 1947. The court referred to the precedent set in the Bangalore Water-Supply case, which established the 'dominant nature test.' According to this test, the predominant nature of the services and the integrated nature of the departments determine if an entity qualifies as an industry. The court noted that sovereign functions, strictly understood, alone qualify for exemption, not welfare activities or economic adventures undertaken by the government. Even within departments discharging sovereign functions, units that are industries and substantially severable can be considered industries.The court examined the Pachgaon Parwati Scheme and the social forestry work in Ahmednagar district, which were aimed at bio-aesthetic development and afforestation, respectively. The court found that these activities could be undertaken by private agencies and were not inalienable functions of the State. Thus, the Forest Department's activities under these schemes could not be regarded as sovereign functions and were open to the provisions of the State Act.2. Whether the State Government indulged in unfair labor practices as per item 6 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971:The second issue was whether the State Government indulged in unfair labor practices by employing workers as 'badlis,' casuals, or temporaries for years to deprive them of permanent status. The Industrial Court found that the respondents had been employed for 5 to 6 years, working for periods ranging from 100 to 330 days each year. The court noted that it would be difficult for workers to prove the employer's intent to deprive them of permanent status. Therefore, it was permissible to infer such intent if workers were kept as casuals for long periods. The court concluded that the primary object of keeping the workers as casuals was to deprive them of permanent status and the associated benefits.3. Whether the directions given by the Industrial Courts need interference:The final issue was regarding the relief granted by the Industrial Courts, which directed the State to make the workers permanent with all benefits of permanent employees. The appellants argued that regularizing all casual workers would impose a significant financial burden on the State. The court noted that the relief of regularization was justified given that the workers had been employed for long periods. The court distinguished this case from the Delhi Development Horticulture Employees Union case, where the employment was under a scheme providing temporary income support. The court found the present case more akin to the State of Haryana v. Piara Singh, where regularization of casual laborers was favored.The court also addressed the argument that some workers were employed under the Maharashtra Employment Guarantee Act, 1977, noting that no factual basis for this submission was on record. The court dismissed the financial burden argument, stating that the relief granted would not apply automatically to all casual employees but would be decided on a case-by-case basis.Conclusion:The court dismissed the appeals, finding no ground to interfere with the Industrial Courts' orders. The directions to make the workers permanent with all associated benefits were upheld, and no order as to costs was made.