A.K. MATHUR, J. - (1.) THESE appeals are directed against the order passed by the Allahabad High Court dated May 21, 2004 whereby the Full Bench of the High Court has disposed of all the writ petitions filed by the workmen against Irrdian Railway Construction Co. Ltd. (hereinafter referred to as Company) and the Regional Manager, IRCON, Rihand Nagar, Sonbhadra. The Full Bench held that the petitioners are not entitled to benefit of continuation of service or regularization as the project stood closed on 6.2.1998. It was held that project stood completed in all respect except necessary electric or other odd works left over. It was also held that petitioners did not apply for recruitment in service of the Company as per the Service Rules and those who appeared and were found suitable were selected and appointed under the service rules of the Company but others who could not appear, their services were terminated in accordance with law. Hence, in total analysis, it was held that sentiments must yield to the cold logic of law, however, hard the case may be. Hence all writ petitions were dismissed.
(2.) IT would be necessary to recapitulate the facts giving rise to these appeals because this is second and third innings of the matter, which has come up before this Court. Earlier the matter came up before this Court wherein the question arose was whether Section 25N of the Industrial Disputes Act, 1947 (hereinafter referred to as the Act) was complied with or not, this Court held that Section 25N was not complied with. Hence, this Court disposed of the petitions holding that Section 25N was not complied, therefore, termination of all workmen was bad and remitted the matter [Mohammad v. Indian Railway Construction Co. Ltd. (1999) 1 SCC 599 reported in back to the High Court with following directions:- "28. In view of the aforesaid discussion and in the light of our finding that Chapter V-B applies to the respondents' Anpara-Rihand Project, in the remanded proceedings in the restored writ petitions of the present 25 appellants, the following questions would squarely arise for consideration of the High Court:- (i) Whether the Anpara-Rihand Nagar Project is subjected to a factual closure as mentioned in the impugned notices of March 1998 or whether the Project is not still completed; (ii) in the light of the answer to the aforesaid question, a further question would arise whether the impugned notices of March 1998 were in fact and in law closure notices as per Section 25-O read with Section 25-FFF of the Act or whether they still remain retrenchment notices and hence would be violative of Section 25N of the Act; (iii) even if it is held that Anpara-Rihand Nagar Project is in fact closed down, whether the 25 appellants were employed in the Project or they were employees of the respondent-Company entitling them to be absorbed in any other project of the Company and consequently whether the impugned notices have not effected any snapping of the employer-employee relationship between the appellants on the one hand and the respondent-Company on the other; (iv) even apart from the aforesaid questions, whether the impugned notices were violative of the guarantee of Articles 14, 16 and 21 of the Constitution of India on the ground that the termination of services of the 25 appellants was arbitrary and discriminatory, the respondent-Company being a "State" within the meaning of Article 12 of the Constitution of India." Salient facts, which are necessary for disposal of these appeals are :- Twenty five petitioners filed writ petition against the respondent Company, which is a construction company wholly owned by the Government of India. It carries out various construction projects throughout the country and abroad. These writ petitioner workmen were employed by respondent Company and respondent no.2 is its Regional Manager who was monitoring project of construction of a railway line of 54 kms. known as Rihand Nagar Project in State of Uttar Pradesh (hereinafter referred to as the Project). These 25 petitioners were employed in this project on different dates during the period spread over from 26.12.1983 up to 24.12.1985. They were assigned different jobs of work at the Rihand Nagar Project. Some were appointed as clerks, account-clerks, store clerks, store cashiers, non-technical supervisors, site supervisors etc. Initially these workmen were required to undertake training and were, therefore, treated as appointed on ad hoc basis. They were not appointed on regular basis. They were supposed to be given pay scale after successful completion of the training. They were placed in regular time-scale. They were subject to be transferred to any other project of the Company in India. They were not required to undertake any other job or business without permission of competent authority. After completion of project they were served with the notices of retrenchment in August/September, 1993. They were rendered surplus and hence retrenchment benefit under Section 25-F(b) of the Act was offered and they were advised to collect their other dues, namely; provident fund, gratuity, leave salary etc. in accordance with the rules of the Company in force at the time of the Project. These retrenchment notices were challenged by the writ petitioners by filing number of writ petitions under Article 226 of the Constitution of India, against respondent Company. In those writ petitions among other arguments, which were sought to be raised like retrenchment is bad as they are recruiting fresh people and their retrenchments were illegal and also violative of Articles 14, 16 and 21 of the Constitution of India, an additional ground was taken that the respondents had illegally invoked the provisions of Chapter V-A of the Industrial Disputes Act, 1947 but in fact Chapter V-B of the said Act applies as more than hundred workmen were being employed by the respondent Company and therefore, retrenchment of the petitioners was required to be complied with the provisions of Section 25N of the Act, which were not followed and termination is illegal and void on that ground. 1. The petition was opposed by the respondent Company. It was submitted that the writ petitioners were only ad hoc employees. They were not regularly appointed after following due procedure of recruitment rules and were employed only at the Rihand Nagar Project. It was submitted that no regular recruitment can be made without following procedure of the recruitment rules and it was also contended that the project has come to an end, therefore petitioners were liable to be retrenched. It was also alleged that the procedure for closure of the project has been complied with as envisaged under Section 25F of the Act. It was contended that Section 25N does not apply to the facts of the present case. It was also contended that the Project is not an industrial establishment as defined by Section 25L of the Act read with Section 2(m) of the Factories Act, 1948 as it is not a factory. It was submitted that they were not employees of the Company but they were recruited solely for the purpose of Rihand Nagar Project and their services were terminated after the said Project was closed and they have no right to be absorbed in any other project. It was submitted that the retrenchment orders were not arbitrary or illegal or violative of Articles 14, 16 and 21 of the Constitution of India. 2. The matter was heard by the learned Single Judge. The learned Single Judge held that the petitioners have put in long service nearly of 9 years and in some cases even more than that and they are permanent employees and they should have been engaged in any other project as their services were transferable throughout the country. It was also held that termination of workmen is amenable to writ jurisdiction under Article 226 of the Constitution of India as it is a State within the meaning of Article 12 of the Constitution of India. Learned Single Judge further held that Section 25N of the Act was not complied with as it was a Factory within the meaning of Section 2(m) of the Factories Act read with Section 25L of the Act. Hence the retrenchment notices are illegal and void being in violation of Section 25N of the Act and accordingly the learned Single Judge allowed the writ petitions, quashed retrenchment notices and directed to allow workmen to continue in service and pay them their dues. 3. Against this order passed by the learned Single Judge dated 7.12.1993 special appeals were filed before the Division Bench of the Allahabad High Court. The Division Bench, however, allowed the appeals of the Company holding that Section 25N of the Act does not apply on two grounds (i) that for a construction company like the respondent Company, the procedure of Section 25-O of the Act is not required to be followed, service of incumbent comes to end ipso facto after completion of project, there is also no question of following the procedure of Section 25N even on the basis that the workmen at the Project were more than hundred in number, (ii) It was also held that in any cas;e, Section 25N of the Act would not apply as respondent Company was not a Factory as it was not an industrial establishment as contemplated by Section 25L of the Act read with Section 2(m) of the Factories Act and accordingly it was held that the petitioners are not the workmen and therefore, they are not entitled to any protection under the Industrial Disputes Act. It was also held that since they were employees of the Project and the project has come to an end, therefore, their services were validly terminated and they have no right to be absorbed after completion of the Project. The writ petitions were dismissed and order of learned Single Judge was set aside. All the 25 petitioners approached this Court by filing the Special Leave Petitions. The leave was granted and appeals were heard. This Court after reviewing all case laws on the subject held that Section 25N of the Act is attracted in the present case. 4. It was observed, "However, as we have seen above, the establishment of the respondent-Company squarely falls within the definition of the term "factory" for the purpose of applicability of Section 25N of the Act. The first point for consideration, therefore, has to be decided in the affirmative in favour of the appellants and against the respondent." 5. As a result of aforesaid finding there was non-compliance of Section 25N, this Court took the view that the retrenchment notices were null and void and the relationship between employer and employee was not snapped. It was further held that at the time notices were issued the Project had not been completed. However, the question with regard to whether the petitioners were employees of the Project or of the Company was left open. It was also brought to the notice of this Court subsequent development that the respondent Company served on the appellants with fresh notices on 24 March, 1998 of termination by way of Office Order No.3/1/98 and in those notices it was mentioned that on completion of the project, the services of the employees were dispensed with w.e.f. 4 September, 1993 on tendering of salary in lieu of notice and retrenchment compensation as admissible under the provisions of the Industrial Disputes Act. These notices were served during pendency of the special leave petitions. Therefore, they were not challenged by the appellants before the High Court. However, it was clearly mentioned in the notices that Rihand Project was finally closed down w.e.f. 6.2.1998 and accordingly the services of the workmen stood dispensed with from the date of issue of notice i.e. 24 March, 1998, It was also pointed out before this Court that work of all railway lines is over and only small maintenance work pursuant to the agreement with the Railway Authorities is being undertaken. But in substance the whole work is complete. This Court observed that since provisions of Chapter V-B of the Act are applicable and the procedure of Section 25-O would get attracted subject to the proviso to Section 25-O(1), therefore, the Court left all these factual questions open i.e. whether the project is completed or not, whether the employees are of the Project or of the company. This Court observed that whether the Company is a State within the meaning of Article 12 of the Constitution of India, whether termination of these employees is arbitrary and discriminatory and violative of Articles 14, 16 and 21 of the Constitution of India are all questions of fact, they cannot be answered in the present proceedings and the fact that fresh notices were issued on 24 March, 1998 which has a fresh cause of action to the employees and were not subject matter of the writ petition and the appellants had no opportunity to put forward their contentions for challenging these notices. Similarly, the respondents also did not get an opportunity to put forward their contentions in defence. Therefore, this Court left all the questions open and gave an opportunity to the petitioners as well as the respondents to amend their pleadings and to file fresh reply and produce relevant supporting material before the High Court and accordingly the four questions were framed by this Court and the matter was remitted back to the High Court for consideration. In the result this Court allowed the appeals of the appellants and set aside order of the Division Bench and affirmed the order of the learned Single Judge and remitted the matter back to the High Court for being disposed of by a Division Bench in the light of the observations made by this Court. 6. Hence the matter came up before the Division Bench of the High Court of Allahabad and in the Division Bench there was difference of opinion between two learned Judges. One of Hon'ble Judges constituting the Division Bench allowed the writ petition and quashed the notices vide order dated 17 May, 2002. The other Hon'ble Judge of the Division Bench dismissed the writ petition. Therefore, the matter was referred to a third Judge. Since both the learned Judges have passed the judgment constituting Division Bench, therefore, the reference to third Judge was not found to be proper and this was challenged by the employer before this Court and this Court vide its order dated 17.10.2003 directed that the matter be heard and disposed of on merits in accordance with law by the Full Bench of the High Court and remitted this matter to the Full Bench. Accordingly, the Hon'ble Chief Justice of the High Court constituted the Full Bench by order dated 12.11.2003 and referred the matter to the Full Bench. The Full Bench after considering the matter came to the conclusion that the petitioners are not entitled to any benefit as aforesaid. Hence the present Special Leave Petitions against the order passed by the Full Bench dated May 21, 2004. 7. The pleadings were amended by the parties and they exchanged affidavits. So far as the first legal question as to whether Section 25N of the Act is applicable to dispute of such nature is concerned that no more remains to be res integra as it has been conclusively held by this Court in aforesaid judgment that Section 25N is applicable that means Chapter V-B of the Act is applicable to this dispute. Now, the question before us at present is whether the findings given by the Full Bench on the questions framed by this Court were correctly answered or not? The first question as framed by this Court was whether factually the closure was effected in February/March 1998 or not? So far this question is concerned the Full Bench answered with reference to various communications that the closure was effected in 1998 and an intimation was sent to all the respective contracting parties i.e. NTPC, NCL, PCL and UPSEB. In this connection reference has been made to the completion certificate issued by the National Thermal Power Corporation Ltd. on 29 March,2000 certifying that the projects referred to had been completed prior to March 1998 and handed over to NTPC. Another certificate was issued by the National thermal Power corporation Ltd. dated 30.3.2000 certifying that the work stands completed. The said Corporation issued certificate on 13 January, 1999 that the projects stood completed much before the date of issue of the notice in question. Another certificate was issued by the Superintending Engineer, U.P. State Electricity Board on 29 March, 2000 and 2.9.1999 about the completion of the work. Similar certificate was issued by the Northern Coal Field Ltd. Jayant Project on 29 March, 2000 certifying the same thing. The entire project conglomeration as a whole was closed down w.e.f. 6,2.1998 after issuance of the notification through newspaper and notice board. The concerned Labour Commissioner and Regional Labour Commissioner were duly informed about the closure. They were informed vide communication dated 4.2.1998. A notice of the closure was also published in the daily newspapers Dainik Jagran and Rashtriya Sahara. It is also pointed out that a small fraction of work remained to be completed, as it was abandoned due to non-availability of site on account of encroachments by members of public which was certified by the UPSEB that it was beyond their control and for that work some 20 Head of Telecom Engineering and Supervisory Staff was retained and they were agreed to reimburse the cost towards supervisory staff of Telecom and Engineering discipline, that the work was undertaken after 14 months of the date of closure of Rihand Nagar Project as separate work and this work was completed on September 2, 1999 and a certificate to this effect was also produced. It is also made clear that for completion of this left over work only people from the Telecom and Engineering discipline were engaged and the petitioners do not fall in any of that category. Therefore, on this question the Full Bench concluded that the closure was effected much before the issuance of the notices of 1998. We are satisfied on the basis of finding given by the Full Bench that the work stood completed in 1998 and a perusal of all these certificates leaves no manner of doubt that work was completed much before the notices were issued in March, 1998.
(3.) SO far as the second and third questions are concerned, the crucial question to be decided is whether they were employees of the Project or of the Company. In this connection the finding was given by the Full Bench that they were employees of the Project and not of the Company. Learned counsel for appellants laid much stress on appointment orders of appellants that they are employees of the Company and not of the Project. He has taken us through various appointment orders issued from time to time and some of the samples, are reproduced as under:- "INDIAN RAILWAY CONSTRUCTION COMPANY LIMITED (A Government of India Undertaking) GRAM : RAILCONST RATTAN JYOTI 18.RAJENDRA PLACE NEW DELHI-110008(INDIA) DATED : 25/8/84 No. lRCON/ESTT./35 Shri Lal Mohammad S/o Ajimuddin Vill:Dallumandaltola, Dt.Malda. You are hereby offered appointment in Anpara Project on a Casual adhoc basis on a consolidated monthly emoluments of Rs.400/- (Rupees four hundred). You are directed to report to Project Manager IRCON at Anpara. In this connection the following instructions are issued. 1. Your training period will be for a period of 12 months after you report for duty. 2. On satisfactory completion of the training you will be required to pass a written and oral examination. 3. On passing your above examination, you will be brought in grade Rs.260-400/-. 4. During your training period you will be entitled to an additional monthly emolument of Rs.50/- if you are posted in Delhi, Bombay or Calcutta. 5. The above appointment is subject to verification of your age, qualifications for which you should produce original documents while reporting Sd/- (N.SWAMINATHAN) COMPANY SECRETARY, IRCON" "INDIAN RAILWAY CONSTRUCTION COMPANY LIMITED (A Government of India Undertaking) GRAM : RAILCONST RATTAN JYOTI 18, RAJENDRA PLACE NEW DELHI-110008(INDIA) No.lRCON/PP/35A DATED: 22-10-83 Md.lntas Hussain S/o Md.Yahim Ali, Village, Chandigachil, P.O. Singhia, Dt. Malda. You are hereby offered appointment in Anpara Project on a Casual adhoc basis con a consolidated monthly emoluments of Rs.400/- (Rupees four hundred). You are directed to report to Project Manager V.S.T.V.P. IRCON at Anpara. In this connection, the following instructions are issued. 1. Your training period will be for a period of 12 months after you report for duty. 2. On satisfactory completion of the training you will be required to pass a written and oral examination. 3. On passing your above examination, you will be brought in grade Rs.260-400/-. You will also be eligible for payment of all allowances as per the rules of the company; 4. Your regular appointment in the Company will be governed by the Recruitment Rules of the Company. 5. You are liable to be posted any where in India. 6. During your training period you will be entitled to an additional monthly emolument of Rs.50/- if you are posted in Delhi, Bombay or Calcutta. Sd/- (N.SWAMINATHAN) COMPANY SECRETARY, IRCON" "INDIAN RAILWAY CONSTRUCTION COMPANY LIMITED A GOVERNMENT OF INDIA UNDERTAKING Office of the Regional Manager P.O. Anpara, District Mirzapur (UP) Dated: 19.5.1988 No.lRCON/ANP/ESTT/15/AL To Shri Meghu Seikh Artisun, IRCON, Baijpur. Dear Sir, 1. On completion of your training you are hereby brought on scale of pay in the grade of Rs. 260-600(Rs.) in the initial pay of Rs. 260/- p.m. with effect from 11.10.1984. You have been brought on the scale of pay in the grade of Rs. In the initial pay of Rs. Pm with effect from. 2. You will be eligible for all the allowances and benefits as per Rules/Orders issued by the Company from time to time. 3. You should produce the following documents at your own expense. (a) A medical certificate of health and physical fitness of prescribed proforma from a qualified Registered Medical Practitioner. (b) Original certificates in support of your educational and other professional qualification, documentary proof, in respect of date of birth etc. together two copies thereof. (c) Attestation form in triplicate (enclosed) after filling. (d) In case you belong to Schedule Caste/Schedule Tribe, one of the following certificates in original should be produced. Matriculation or School Leaving Certificates or birth certificate giving your caste/community and place or residence. Or A certificate in the prescribed form issued by the Competent Authority. 4. You should take an Oath of allegiance to the Constitution of India in the appropriate form. 5. You will be liable for transfer to any of the Office Project site under the control of the company in India. 6. You will not save with the prior permission of the Competent Authority, apply for any appointment outside the company. You will have to withdraw your application for appointment elsewhere made prior to the date of issue of these orders and will not appear for interview or accept any employment it offered. 7. You will not save with the express permission from the company, engage in any trade or business or undertake any other work or any employment elsewhere full time or part time while in the service of the company. 8. In regard to any matters not specifically covered in the foregoing paragraphs, you will be governed by the rules and orders applicable to the employees of the company. 9. If any declaration given or information furnished by you proves to be false, or it is found that you have willfully suppressed any material information you will be liable to removal from services forthwith without any notice and without assigning any reason therefore, notwithstanding any action taken against you as the Company may deem necessary. For and on behalf of Indian Railway Construction Co. Ltd. -sd/- Regional Manager IRCON-ANPARA Copy of information and necessary action to: 1. Group General Manager (T), IRCON, New Delhi." Other appointment letters are on the same pattern. Therefore, no useful purpose will be served by reproducing all of them. On the basis of these letters learned counsel submitted that a perusal of these appointment orders clearly shows that appointments were made by the Company and they were directed to report to the Project Officer of the Company. It was submitted that after the necessary training and passing required examination the incumbents were entitled to regular pay scale of Rs.260-400/- along with all allowances as per the rules of the company, that incumbent can be posted at any where in India on any project, no employment could be taken up by incumbent without prior permission of the company, that incumbent is not required to engage in a trade or business, that they will be governed by the rules of the company, that group insurance was also taken out by the company, that they were required to take oath of allegiance to the constitution. On the basis of these salient features the learned counsel submitted that it leads to only and only inference that the petitioners were employees of the Company and not of the Project. It was submitted that since each incumbent has to work on the Project and that they were directed to report to the project officer, that does not mean that they were employees of the project and not of the Company.;