M D KARNATAKA HANDLOOM DEV CORPN LTD Vs. MAHADEVA LAXMAN RAVAL
LAWS(SC)-2006-11-107
SUPREME COURT OF INDIA (FROM: KARNATAKA)
Decided on November 16,2006

M.D.KARNATAKA HANDLOOM DEV. CORPN. LTD. Appellant
VERSUS
MAHADEVA LAXMAN RAVAL Respondents





Cited Judgements :-

DAMODAR VALLEY CORPORATION VS. ARJUN KUMAR RAY [LAWS(CAL)-2007-8-99] [REFERRED]
EMPLOYERS IN RELATION TO THE MANAGEMENT OF TATA STEEL LIMITED VS. THE CONCERNED WORKMAN, PROBODH KUMAR SAHANI [LAWS(JHAR)-2016-2-7] [REFERRED TO]
ALSTOM INDIA LIMITED VS. SIDRAM AND ORS. [LAWS(KAR)-2015-11-177] [REFERRED TO]
NARESH CHAND VS. PRESIDING OFFICER CGIT NEW DELHI [LAWS(DLH)-2008-2-326] [REFERRED TO]
CHIEF EXECUTIVE AUTHORITY VS. SURESH HARJIBHAI PATEL [LAWS(GJH)-2010-3-199] [REFERRED TO]
GEB SUBSTITUTED AS GUJARAT STATE ELECTRICITY VS. HARISHKUAMR N BOSAMIYA [LAWS(GJH)-2014-1-36] [REFERRED TO]
MANAGEMENT OF TISCO VS. PRESIDING OFFICER [LAWS(JHAR)-2012-8-64] [REFERRED TO]
AHMEDABAD MUNICIPAL CORPORATION VS. DIPAK VIRAMBHAI PARMAR [LAWS(GJH)-2014-7-186] [REFERRED TO]
MAHINDRA AND MAHINDRA LTD VS. MADHAV RAMKRISHNA LOMTE [LAWS(BOM)-2021-11-229] [REFERRED TO]
MANAGEMENT OF NATIONAL HIGHWAYS AUTHORITY OF INDIA VS. VINITA [LAWS(DLH)-2021-1-151] [REFERRED TO]
INDIAN RAYON INDUSTRIES LTD. VS. BAMANIYA LAKHABHAI BHAGVANJIBHAI [LAWS(GJH)-2015-3-15] [REFERRED TO]
HARSHABEN DALPATSINH RAJPUT VS. PRESIDENT, NASHABANDHI MANDAL [LAWS(GJH)-2017-2-248] [REFERRED TO]
ASSISTANT GENERAL MANAGER VS. SHRI JAGJIWAN LAL PATEL [LAWS(MPH)-2017-2-235] [REFERRED TO]
U P RAJKIYA NIRMAN NIGAM VS. U P RAJKIYA NIRMAN KARAMCHARI SANGH [LAWS(ALL)-2007-3-268] [REFERRED TO]
CHANDRKANTBHAI BHAICHANDBHAI SHARMA VS. STATE OF GUJARAT AND ORS. [LAWS(GJH)-2015-10-140] [REFERRED TO]
ARJUN KUMAR RAY VS. DAMODAR VALLY CORPORATION [LAWS(CAL)-2007-8-70] [REFERRED TO]
S. SUNANDA VS. CHAIRMAN INDIRA GANDHI RSHTRIYA URAN AKADEMI NEWDELHI [LAWS(ALL)-2023-4-78] [REFERRED TO]
BHAVNAGAR DIST PANCHAYAT AND ORS VS. NAVINBHAI BABUBHAI ZAVERI [LAWS(GJH)-2012-7-627] [REFERRED TO]
MANAGEMENT OF TISCO VS. PRESIDING OFFICER LABOUR COURT PATNA [LAWS(JHAR)-2014-3-6] [REFERRED TO]
JUNAGADH MUNICIPAL CORPORATION VS. DIPAKBHAI PRATAPBHAI KARAMATA [LAWS(GJH)-2020-7-285] [REFERRED TO]
RAM KEWAL VS. DIRECTOR, INDIAN INSTITUTE OF SUGARCANE RESEARCH [LAWS(ALL)-2019-5-424] [REFERRED TO]
THE NAGPUR DISTRICT CENTRAL CO-OPERATIVE BANK LTD. VS. PRASHANT ASHOKRAO SALUNKE AND ORS. [LAWS(BOM)-2016-1-34] [REFERRED TO]
ANIL KUMAR PRABHAKAR VS. TELECOMMUNICATIONS CONSULTANT INDIA LTD [LAWS(DLH)-2010-4-90] [REFERRED TO]
CHIEF EXECUTIVE (AUTHORITY) VS. KANJI LAXMAN CHAUHAN [LAWS(GJH)-2019-8-182] [REFERRED TO]
COMMISSIONER VS. PRAVINBHAI GHUDABHAI MARU [LAWS(GJH)-2017-6-344] [REFERRED TO]
TATA TEA LTD VS. TATA TEA LTD [LAWS(BOM)-2007-9-12] [REFERRED TO]


JUDGEMENT

A.R.Lakshmanan, J. - (1.)KARNATAKA Handloom Development Corporation Limited is the appellant in this appeal. The appellant-Corporation is a Public Sector Enterprise established by the KARNATAKA State Government to promote and assist the growth and development of the Handloom Industry outside the Cooperative sector in the State.
(2.)THE respondent was appointed for various spells of fixed periods on a fixed honorarium as an expert weaver to train the weavers in the unorganized sector. THE respondent was appointed on contract basis for a period of 200 days only, on a fixed pay of Rs.400 per month with a stipulation that the contract of appointment automatically expires on the 201st day.
The State Government introduced "VISHWA" programme to train and TO rehabilitate the weavers. The respondent was appointed specifically under the scheme on contract basis in February, 1993 for a period of 3 months on different terms of pay of Rs.1,000/- per month. He was again appointed on contract basis for a period of 9 months as per the terms set out in the letter of appointment. After the expiry of the contract of appointment, on 31.08.1994, he was not appointed again. Being aggrieved, the respondent raised an Industrial Dispute. The Labour Department referred the dispute under Section 10(1)(c) of the Industrial Disputes Act, 1947 (hereinafter called "the I.D. Act") for adjudication, inter alia, on the question (a) whether the Project Administrator Handloom, Banhatti is justified in refusing employment to the workman. The appellant-Corporation, inter alia, contended that: 1) the I.D. Act does not apply to the respondent and 2) the respondent, his father and his wife have been doing business with the appellant at the relevant time and that the respondent was independently doing the weaving business and 3) the respondent was engaged on contract basis for fixed periods only and later under a specific scheme/Vishwa programme introduced by the State and that the scheme has already been closed and as such there are no funds for continuing with the said scheme.

The Labour Court allowed the reference, in part, directing reinstatement without back wages. Aggrieved by the award, the Corporation preferred a writ petition, which was dismissed by a Single Judge. The writ appeal filed by the appellant-Corporation was also dismissed by the Division Bench of the High Court. Aggrieved by the dismissal of their writ appeal, the Corporation preferred the above appeal in this Court. We have heard Mr. P. Vishwanatha Shetty, learned senior counsel for the appellant-Corporation and Mrs. Rajani K. Prasad, learned counsel for the respondent.

(3.)MR. P. Vishwanatha Shetty, learned senior counsel submitted that the High Court has failed to appreciate that the respondent was not a workman in the employment of the appellant-Corporation and that the respondent was a weaver in the area as any other independent weaver in the area and was getting certain concession from the Corporation which was in the interest of development of Handloom Industry. It was further submitted that there is no finding of the Labour Court that the workman was working for 240 days continuously in a calender year under the employer with wages and, therefore, the findings of the Labour Court and the confirmation by the High Court are erroneous. It was further contended that the respondent has worked as master weaver for certain periods with aims and objectives of the scheme of the Corporation which is purely temporary in nature and the respondent had been an independent weaver before and after the temporary period of training. It was further argued that the appellant has no control over the respondent or over his work and that they are given only assistance in the form of raw materials, yarn etc. to convert the yarn into fabric and to again sell the finished products to the Corporation. There is no relationship of employee and employer between the Corporation and the weavers and when such is the case under the scheme, the master weavers who are engaged by the Corporation to give training to the weavers in the matter of weaving of cloth cannot be considered as a workman. Learned senior counsel would further submit that the inference drawn by the High Court on the appointment orders issued to the respondent from time to time that the respondent has worked for 240 days is not correct and that the respondent was engaged for different periods which should not be combined to say that he had worked for 240 days. Learned senior counsel also submitted that there is no question of violation of Section 25 (b) and Section (f) of the I.D. Act and that the findings that the workman has continuously worked for a period of 240 days was contrary to the facts and circumstances and that the respondent was given honorarium of one week and not regular salary as required under the I.D. Act and that he was only encouraged to support or share his master skills to the other weavers while doing his own weaving work for the maintenance of his family. Concluding his arguments learned senior counsel submitted that the High Court is not justified in ordering reinstatement of the worker who is not a worker but employed on contract basis, time bound specific scheme assigned as weaving trainer and who has not been dismissed or terminated by the management. Per contra, MRs. Rajani K. Prasad, learned counsel for the respondent submitted that the respondent had worked with the appellant-Corporation from 1987 to 1994 i.e. more than 240 days as contemplated under Section 25B of the I.D. Act and, hence, his dismissal amounted to retrenchment within the meaning of Section 2(oo) of the I.D. Act and since the termination of his service was without the compliance of the provisions of Section 25F of the I.D. Act, the respondent raised a dispute before the Labour Court with a prayer to set aside the termination and to pass an award for reinstatement, full back wages and with all other benefits. The Labour Court allowed the respondent's reference and directed the Corporation to reinstate the respondent into service without back wages. When the judgment of the Labour Court was challenged before the High Court, the High Court dismissed the writ petition and the writ appeal filed by the management on the ground that as the respondent had served for a period of 240 days in a year immediately preceding the termination, the termination amounted to retrenchment and, hence, the Labour Court has rightly directed reinstatement. Learned counsel for the respondent submitted that the civil appeal has no merits and, therefore, it is liable to be dismissed in the interest of justice and fair play. We have carefully perused the pleadings, the award of the Labour Court, judgment passed by the learned Single Judge and also of the learned Judges of the Division Bench and other annexures filed by both parties in the civil appeal. Before proceeding to consider the rival submissions, it is beneficial to notice the nature of work entrusted to the respondent under the project in question undertaken by the Karnataka Handloom Development Corporation. The nature of work entrusted to the respondent is to carry out the usual business of selling the cotton yarn or polyster to weavers who are covered under the scheme of the Corporation. The said weavers who purchased the yarn, after converting into a finished product in the form of cloth, sell the same to the respondent, the sale value of the finished product is credited to the account of each such weaver. If the weavers execute a targeted business in the stipulated period, incentives are also given to such weavers. These weavers are also provided loans by the banks, KFFC and such banking or financial institutions and the same is kept as a security with the respondent towards raw material provided to the weavers and also looms and accessories. It is also the objective of the Corporation to enhance and develop handloom cloth and promote such employment through the scheme provided by the Corporation. The Corporation more or less provides a sure mode of sale of the products of these weavers. To increase the employment opportunities and to get the unskilled persons trained into weavers, the Corporation has entrusted the respondent the responsibility through a scheme sponsored by the Government under the Vishwa programme. For getting trained new persons as weavers, expert weavers are being engaged by the respondent. This training programme is not perennial in nature of work of the respondent. As and when such schemes are sanctioned for the limited period (sanctioned period), expert weavers on stipend/honorarium of Rs.1000/- for a specific period of 9 months are appointed. In this case 9 months period will commence from the date of his appointment i.e. 30.11.1993 under No.KHDC/IHDP/BNT/ADM/93-94:1301. It is thus clear from the above that the respondent claimant is aware that his appointment was purely contractual and for a specified period. He is also aware that he is not eligible to any other benefits as a regular employee of the Corporation and could be liable for termination without any notice and without payment of compensation. The claimant is also aware that his appointment stood automatically terminated on the completion of the stipulated period. The case of the claimant, therefore, in our view, does not become an industrial dispute. We shall now as a sample reproduce one appointment order dated 30.11.1993. JUDGEMENT_427_TLPRE0_2006Html1.htm
A careful perusal of the terms and conditions of appointment would go to show that the respondent is not a worker but employed on contract basis on a time bound specific scheme assigned as weaving trainer. However, the learned Judges of the Division Bench committed a factual error in holding that the above letter of appointment does not show that employment was not a contract which stipulated that it comes to an end with the expiry of project or scheme nor is it the case of the Corporation that the respondent was made aware of any such stipulation even at the commencement of the employment. The High Court has failed to notice that the respondent was engaged on contract basis and had been assigned to train weavers who were lagging in weaving skills in the weaving potential development area working on time specific short term scheme sponsored by the Corporation. We are, therefore, of the opinion that the respondent is not a worker for the purposes of Section 25F of the I.D. Act but employed on contract basis only. The High Court also has not properly appreciated the judgment relied on - S.M. Nilajkar and Ors. vs. Telecom District Manager, Karnataka, (2003) 4 SCC 27. As the respondent was engaged as trainer for a specific period under the scheme and was paid a stipend of Rs.1,000/- p.m. from the date of his appointment and, therefore, Section 2(oo) of the Act is not attracted soon after the expiry of the specific period the respondent's service was discontinued and so it is not a retrenchment as defined under Section 2(oo) of the I.D. Act. On the other hand, the case of the Corporation before the learned Single Judge and also before the Division Bench was that the respondent was not a workman in the employment of the appellant and that he was a weaver in the area as another weaver in the area and was getting certain concessions from the Corporation.



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