TaxTMI 
TaxTMI 
1996 (2) TMI 576
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....demand for regularization with retrospective effect was justified? If so, the extent of relief payable to these 166 persons may be indicated." 4. The employer -- Reserve Bank of India is a Corporation established under the Reserve Bank of India Act, 1934 (No. 2) and vested with some sovereign functions such as issue of currency notes etc. It acts as Bankers' Bank and as Banker to the Central and State Governments. For carrying on the business, the Bank employs various categories of staff such as Officers (Class-I), (Class-II), Clerks, Stenographers, Typists etc. (Class III) and Peons, Mazdoors etc. (Class- IV). The Bank has been providing canteen facilities to its employees in Classes III and IV. The Reserve Bank "Lounge" caters to the needs of its officers at some centers. There is no obligation either under any statute or otherwise, for the Bank to run the canteens. It is so done only as a welfare measure. The Bank bears by way of subsidy to the extent of 95% of the costs incurred by the canteens for payment of salary, provident fund contribution, gratuity, uniform etc., and also provides premises, fixtures, utensils, furniture, electricity, water etc., free of charges.....
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....Reserve Bank of India. The plea of the Federation on behalf of the workmen is that the Bank is under a statutory obligation to provide canteen facility to the employees and the same is being done through agencies such as Implementation Committee (Canteen Committee), Co- operative Society and contractor instead of the Bank doing it on its own by employing persons directly. On behalf of the workmen, it was further contended that the Bank cannot shift its responsibility to others, that the entire economic control is With the bank and so the worker. employed in all these canteens, whether by the Implementation Committee or by the Co-operative Societies or by the contractors should be directed to be absorbed with retrospective effect with point to point adjustment and the Bank be directed to pay difference of wages. 7. The Bank disputed the claim made by the Federation on behalf of the workmen. It was contended that the Bank makes available space for running the canteens on leave and licence basis and various facilities are also provided to the Implementation Committee, Co-operative Society or the contractor, whosoever runs the canteen. The canteens are in the nature of clubs. The ma....
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....ank of India, that they will have to be paid difference in ways which they would have earned and which they have been paid. As can be seen from the Annexure 'A' to the statement of claim certain categories of employees are clubbed together for the purposes of pay scale. The Assistant cook, tea boys & farash is one such clubbing, Supervisor and coupon clerk is another. ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... The just direction in my view would be that they will be entitled to absorption and difference in back wages with effect from 1st of March 1995. In respect of employees who are working in the canteens run through the contractors they will be entitled to the benefit with effect from the date the respective contracts come to an end." It is the aforesaid award that is assailed by the Bank in this appeal filed by Special Leave. 9. A perusal of the award passed by the Tribunal as a whole shows, that in its view the plea raised by the workmen employed in various canteens clearly falls within the ratio laid down by this Court in M.M.R. Khan v. Union of India [1990 (Supp.) SCC 191] and so they are entitled to the reli....
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....of the Tribunal is justified in law, holding that the instant case is covered by the decision of this Court in M.M.R. Khan's case (supra). 11. The test to determine as to whether a person is a workman and the relationship of master and servant exists in a particular case has been laid down by this Court in innumerable decisions. In one of the earliest oft quoted cases, Dharangadhra Chemical Works Ltd. v. State of Saurashtra and others (AIR 1957 SC 264), delivering the judgment of the four-member Bench, Bhagwati, J. considered in detail the various decisions on the point and laid down the law thus: "The principle which emerges from these authorities is that the Prima facie test for the determination of the relationship between master and servant is the existence of the right in the master to supervise and control the work done by the servant 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 or to borrow the words of Lord Uthwatt at page 23 in Mersey Docks and Harbour Board v. Coggins & Griffith (Liverpool) Ltd., 1947-I AC 1, at page 23(E), "The proper test is whether or not the hirer had ....
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....t of M/s. Puri Urban Co-operative Bank v. Madhusudhan Sahu [1992(2) SCR 977], delivering the judgment on behalf of the Bench, Punchhi, J. at page 980, after referring to the aforesaid decisions, stated thus: "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. And this Principle holds the field". (Emphasis supplied) 12. In applying the law laid down by this Court, as stated above, we should distinguish those line of cases, where a statutory liability is cast on the employer for maintaining the canteen viz. as per Section 46 of the Factories Act or due to the extended meaning given to the definition of the word 'employer' in the particular statute, any other person like a contractor to whom an owner of the undertaking had entru....
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....ce conditions are governed by the rules applicable to the employees of the government department/office/establishment to which the canteens are attached. In this background, the Court adverted in detail to the various government orders and circulars of the Railway Board vis-a-vis section 45 of the Factories Act and held that the employees in the "statutory canteens" of the railways will have to be treated as "railway servants". It was further observed that the employees in the statutory canteens are entitled to the status of railway employees and they are entitled to succeed in their claim purely on facts peculiar to them discussed in the judgment. Dealing with the second category - "Nonstatutory Recognised Canteens", the Court adverted to paragraphs 2831 to 2834 of the Railway Establishment Manual and held that the aforesaid provisions enjoin the Railway Administration to take steps to develop their canteen organization to the maximum possible extent as a measure of staff welfare preferably by encouraging the development of canteens for staff on co-operative basis. This mandate was stated to be in addition to the canteens required to be established by the Factories Act. On a re....
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....e categories in M.M.R. Khan's case (supra) was that they were railway servants. With regard to the Non-statutory Recognised Canteens, on an appraisal of the relevant paragraphs of the Railway Establishment Manual, the notifications and circulars issued by the Board from time to time and the orders passed by courts, this Court held that there is hardly any difference between the statutory canteens and Nonstatutory Recognised Canteens and no distinction is possible between the employees of the two types of canteens so far as their service conditions are concerned. Indeed in a later decision of this Court in Parimal Chandra Raha vs. Life Insurance Corporation of India (JT 1995 (3) SC 288) at page 304, in paragraph 26 of the judgment, this Court highlighted the fact that M.M.R. Khan's case (supra) which had decided the claim of the Non- statutory Recognised Canteens was decided on the facts of that case including the provisions of the Railway Establishment Manual, the notifications and circulars issued by the Railway Board from time to time and other documents. The non-statutory recognised canteens were also to be on par with the statutory canteens in view of the mandate contai....
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....orkmen came up before Justice Sri Dinghe on a reference, on an earlier occasion, the Bank had submitted that adequate canteen facilities are available to the employees of the Bank and that the Bank has provided facilities in that regard. Regarding the canteen run by the Implementation Committee (Canteen Committee), out of the 12 representatives 3 of them are from the bank -- the Currency Officer, Personnel Officer and the Officer from the Personal Policy Department. The Currency Officer is always the Chairman of the Canteen Committee. The Bank relieved four employees who are in the Committee, two for full day and two for half day to supervise the day to day affairs of the canteen. The committee cannot increase the strength of the canteen employees without the permission of the bank. The rates of the eatables also cannot be revised without the consent of the Manager. They cannot effect any wage revision without the approval of the Bank. The Bank is also reimbursing the expenses incurred over the periodical medical check up cf the employees attached to the kitchen and counters. In these circumstances, the Tribunal held that the case clearly falls within the ratio laid down by this co....
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.... prior sanction of the Bank and so these canteens, are non- statutory recognized canteens, and there is direct control exercised by the Bank in the form of nominating the representative of the Bank. Here again none of the peculiar aspects adverted to by this Court in M.M.R. Khan's case (supra) regarding the non-statutory recognized canteens are present. The mere fact that the Bank nominates its representative the committee or reimburses the licence renewal charges will not in any way provide any direct control. 20. we will now take up the matter regarding the non- statutory non-recognised cnateens. In dealing with this matter, the Tribunal has referred to the various aspects stressed in paragraph 38 of the judgment in M.M.R. Khan's case (supra) that the workmen therein are not railway servants. The Tribunal has adverted to the agreement executed between the Bank and the contractor which, according to it, will show that the distinguishing features mentioned in M.M.R. Khan's case (supra) are not present in this case. It may be so. That leads us to no positive conclusion regarding the matter at issue. As per the agreement the bank has detailed the subsidy and other faci....
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....e relationship of master and servant existed between the Bank and the various persons employed in three types of canteens. 166 persons mentioned in the list attached to the reference are not workmen of the Reserve Bank of India and that they are not comparable employees employed in the officers lounge. Therefore, the demand for regularization is unsustainable and they are not entitled to any relief. We hold that the award passed by the Tribunal is factually and legally unsustainable. 22. Before concluding the case, we should advert to the decision of this Court reported in Parimal Chand a Raha v. Life Insurance Corporation of India (Supra) brought to our notice. Both sides extensively referred to this judgment to reinforce their plea. After adverting to the earlier decisions, this Court has summarized the law in paragraph 27 of the impugned thus: "What emerges from the statute law and the judicial decisions is as follows: (i) Where, as under the provisions of the Factories Act, it is statutorily obligatory on the employer to provide and maintain canteen for the use of his employees, the canteen becomes a part of the establishment and, ....