Venkataramiah, J. - (1.) The question involved in these petitions is whether the workmen who were working in canteens established under S. 46 of the Factories Act. 1948 (hereinafter referred to as 'the Act') in Ordnance Equipment Factory, Kanpur, Central Ordnance Depot, Kanpur and Air Force Station. Kanpur are entitled to claim the period of service in such canteens prior to 22-10-1980 as part of the qualifying service for claiming pension.
(2.) The three industrial establishments, referred to above, namely; Ordnance Equipment Factory, Central Ordnance Depot and Air Force Station, Kanpur are defence establishments forming part of the Defence Department of the Union of India. By the Order No. 18(1)80/D(JCM) dated the 25th July, 1981 sanction was accorded by the President of India to treat all employees of canteens established in Defence Industrial Installations under S. 46 of the Act as Government employees with immediate effect. By an amendment, the said Government Order was given effect from 22-10-1980. The Government Order further provided that it would be applicable to all employees of the statutory canteens irrespective of the type and management of the canteens and till the Government decided otherwise the employees of the said canteens would continue to be governed by the terms and conditions of service laid down in their appointment letters and contracts of employment already subsisting. It was further stated that they would be continued to be paid such emoluments to which they were entitled then. When some of the employees retired after 22-10-1980 they applied for payment of pension. The Defence Department declined to treat the period of service rendered by them prior to 22-10-1980 in such canteens as part of qualifying service for purposes of pension on the ground that it was only with effect from 22-10-1980 from which date they had become Government employees their qualifying service could be counted. Aggrieved by the rejection of the claim of the workers in those canteens, the petitioners herein, have filed these petitions in this Court for declaration that the service rendered by the employees of such canteens prior to 22-10-1980 should be treated as qualifying service for purposes of pension. On behalf of the Union of India counter-affidavits were filed resisting the claim of the petitioners. As the information furnished in the counter-affidavits was inadequate for purposes of disposing of the cases, the Court by its order dated 22-3-1988 directed the Union of India to file a fuller affidavit giving information about the following matters, namely; the authority which had the power to appoint workers in such canteens prior to 22-10-1980, the authority which was paving salary to the workers in the said canteens prior to 22-10-1980, the authority which was controlling such canteens prior to 22-10-1980, the particulars of the persons who were consumers of the service rendered by the said canteens prior to 22-10-1980 and other relevant matters in order to decide the status of the workers in the said canteens prior to 22-10-1980. There upon a further affidavit has been filed by Shri N. Sivasubramanian, Joint Secretary (Ordnance Factories) to the Government of India, Ministry of Defence, New Delhi. In the said affidavit it is stated that (a) prior to being declared as Government servants w.e.f. 22-10-1980 the canteen workers in Ordnance Factories were under the canteen managing committees constituted as per provisions of Section 46 of the Act; (b) the supervision and control of such canteens were exercised by the Canteen Managing Committee consisting of equal number of elected representatives of the factory, workers and nominees of the management and the Canteen Managing Committee was the appointing authority of the canteen workers; and (c) that the Canteen Managing Committee was paving the salary to the workers and also controlling the canteens. It was further admitted that by the letter dated 24-5-1965 of the Ministry of Defence it had been ordered thus: "The question of subsidising the canteens maintained in Defence Industrial Installations with reference to provisions of Section 46 of the Factories Act 1948 has been under the consideration of Government for some time. After a detailed examination of the matter it has been decided that in order to reduce the cost of meals and snacks served by the canteen to the personnel of the Defence Industrial Installations registered as factories and subject to the conditions indicated in the succeeding paras, the cost of supervisory and clerical staff and cooks, bearers, helpers, vendors etc. employed in these canteen should be reimbursed by the Govt. to the Managing Committee of such canteens ................ The Commandants of the installations will simultaneously ensure that the cost of the meals / snacks provided by these canteens is reduce proportionate to the subsidy received from Govt. for the cost of the staff ................ In order to ensure that uniform standards for employment of staff and payment of salaries as far as possible and the subsidy paid by the Government is related to total number of personnel served by the canteens the number and grades of supervisory, clerical and working staff and the scales of pay that should be allowed to them are given in Appendix 'A' to this office Memorandum for the guidance of the installation Commanders and the Managing Committee. These scales of staff and salaries are the maximum outer limits within which the local Management may engage the staff and workers actually required. Where staff can be engaged on more economical rates it may be employed on such rates. The existing supervisory, clerical and working personnel may be brought over to those pay scales to the extent necessary by taking into account their existing emoluments and thereafter annual increments may be allowed after one year from the date of switchover to these scales. Other concessions or allowances of any kind should be allowed to the staff in addition to these consolidated pay scales. Other terms and conditions of service may continue to be regulated by the Managing Committee as here-to-fore...........Reimbursement of the cost of staff will be limited to the scales indicated in the appendix ........... These orders are not applicable to the canteens which are at present run by contractors. Such canteens can, however, be switched over to this scheme after the terms of the contract with the contractors have expired or by terminating the contract, in accordance with the existing clauses thereof if any. This scheme will also be applicable to new canteens organised by co-operative societies of the staff of Managing Committee appointed under the guidance of the administration in pursuance of Section 46 of the Factories Act in other Defence Industrial Installations which are registered as "factories" and where canteens have not so far been opened".
(3.) It is seen from the above letter of the Ministry of Defence that prior to 24-5-1965 there were three kinds of canteens, namely:(i) canteens run by contractors, (ii) canteens run by co-operative societies of the staff, and (iii) canteens which had been established under Section 46 of the Act. We are not concerned with the first two categories of the canteens but only with the last category of canteens in this case. The above Ministry of Defence letter provides for subsidising the canteens maintained in Defence Industrial Installations under Section 46 of the Act. It also gives directions regarding pay-scales, conditions of service etc. The consumers of the services rendered by such canteens were the factory employees for whose benefit they had been established. It is also not disputed that the building or buildings in which such canteens had been established formed part of the industrial establishment concerned.;