TaxTMI 
TaxTMI 
2005 (4) TMI 659
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....ces. Division Bench, has set aside the aforesaid direction given by the learned Single Judge and held that the appellants were neither entitled to be absorbed nor regularised in the service of the respondent. 2. Short facts of the case are as under:- Two sets of writ applications were filed in the High Court of Calcutta involving common question of law and fact, both of them were taken up together by the Single Judge and disposed of by the common judgment. Admittedly, the appellants are working in the statutory canteen run by the respondent through contractor in its factory at Haldia, District Midnapore, West Bengal. Respondent was treating the appellants as the employees of the contractor. Aggrieved against this, the appellants filed the writ applications in the High Court contending therein that the factory of the respondent where the workmen are employed is governed by the provisions of Indian Factories Act 1948 (for short "the Factories Act") and the canteen where the said workman are employed is a statutory canteen established by the respondent as required under the provisions of the Act. It is averred in the petition that the canteen is maintained for the benefit ....
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....fore, apart from the fact that the appellants were not in regular employment of the respondent, the absorption or regularisation of their services would contravene Article 16(4) of the Constitution as well as the reservation policy which is applicable for recruitment in the establishment managed by it. 4. The learned Single Judge before whom the writ applications came up for hearing relying upon the two judgments of this Court in M.M.R. Khan and Ors. v. Union of India and Ors. [1990] 1 SCR 687 and Parimal Chandra Raha and Ors. v. Life Insurance Corporation of India and Ors. (1995) IILLJ 339 SC held that under the provisions of the Factories Act, it is the statutory obligation of the employer to provide and maintain a canteen for the use of its employees. The canteen becomes a part of the establishment and, therefore, the workers employed in such canteen are the employees of the management. After referring to the various provisions including the rules framed under the Factories Act the learned Single Judge came to the conclusion that the respondent exercises a very high degree of control over the contractor who has been given the contract of running the canteen. The obligation to....
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.... the workmen of the establishment for the purpose of the Factories Act only and not for all other purposes." [Emphasis supplied] 7. Further it was observed:- "It is clear from this definition that a person employed either directly or by or through any contractor in a place where manufacturing process is carried on, is a "workman" for the purpose of this Act. Section 46 of the Act empowers the State Government to make rules requiring any specified factory wherein more than 250 workers are ordinarily employed to provide and maintain a canteen by the occupier for the use of the workers. It is not in dispute, pursuant to this requirement of law, the Management has been providing canteen facilities wherein the respondent employees are working. Hence, it is fairly conceded by the learned counsel for the Management that the respondent workmen by virtue of the definition of the "workman" under the Act, are the employees of the appellant Management for purposes of the Act." 8. After having gone into the question of worker being declared the employee of the management for the purpose of Factories Act, the Court further analysed the question as to whether such relationship a....
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....ed by the appellant. (e) The supervision and control on the canteen is exercised by the appellant through its authorised officer, as can be seen from the various clauses of the contract between the appellant and the contractor. (f) The contractor is nothing but an agent or a manager of the appellant, who works completely under the supervision, control and directions of the appellant. (g) The workmen have the protection of continuous employment in the establishment." 10. Considering these factors cumulatively in addition to the fact that the canteen in the establishment of the management is a statutory canteen the workmen were held to be the employees of the management. On the question of fact it was concluded that the contractor in that case was engaged only for the purpose of record and for all other purposes the workers were in fact the workmen of the management. It was observed in para 27 as under:- "At this stage, it is necessary to note another argument of Mr. Andhyarujina that in view of the fact that there is no abolition of contract labour in the canteen of the appellant's establishment, it is open to the Management to manage its c....
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....respect provided such increase or decrease in the manpower should be done only with the express approval of the owner. If any manpower is added without approval of the Owner, it will be at the cost of the contractor and no liability for compensation whatsoever shall accrue on the Owner for such act/acts. No person below the age of 18 years or found to be medically unfit, will be allowed employment in the canteen. Also if, at any time, any canteen employee is found involved in moral turpitude in any court of law, the services of such canteen employee will be immediately terminated by the Contractor and no liability for compensation whatsoever will accrue on the owner for such act/acts. 5.3 The contractor shall maintain a register showing names and addresses of the persons so engaged along with photographs of each person and shall produce the same for inspection on demand by Welfare Officer or such other person so authorised by the owner. The contractor shall not use or allow to be authorised to be used canteen building or any part thereof for dwelling purpose and shall not allow any outsiders to loiter in or around the canteen without valid authority." 14. With regard to....
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....contractor to keep proper records pertaining to payment of wages etc, and also for depositing the provident fund contributions with authorities concerned. Contractor has been made liable to defend, indemnify and hold harmless the employer from any liability or penalty which may be imposed by the Central, State or local authorities by reason of any violation by the contractor of such laws, regulations and also from all claims, suits or proceedings that may be brought against the management arising under or incidental to or by reason of the work provided/assigned under the contract brought by employees of the contractor, third party or by Central or State Government Authorities. 17. The management has kept with it the right to test, interview or otherwise assess or determine the quality of the employees/workers with regard to their level of skills, knowledge, proficiency, capability etc. so as to ensure that the employees/workers are competent and qualified and suitable for efficient performance of the work covered under the contract. This control has been kept by the management to keep a check over the quality of service provided to its employees. It has nothing to do with either....