Gujarat High Court
Contracotr Kaushal Agency vs The Presiding Officer , Labour Court on 15 September, 2025
NEUTRAL CITATION
C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 7870 of 2025
With
R/SPECIAL CIVIL APPLICATION NO. 8007 of 2025
With
R/SPECIAL CIVIL APPLICATION NO. 8006 of 2025
With
R/SPECIAL CIVIL APPLICATION NO. 7887 of 2025
With
R/SPECIAL CIVIL APPLICATION NO. 8018 of 2025
With
R/SPECIAL CIVIL APPLICATION NO. 10258 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MRS. JUSTICE M. K. THAKKER
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Approved for Reporting Yes No
NO
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CONTRACOTR KAUSHAL AGENCY & ANR.
Versus
THE PRESIDING OFFICER , LABOUR COURT & ORS.
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Appearance:
MS MITA S PANCHAL(530) for the Petitioner(s) No. 1,2
MR SUNIL AGARKAR FOR LEXSTREET ADVISORS LLP(14629) for the
Respondent(s) No. 3
MR. DIVYANG A RAMANI(7180) for the Respondent(s) No. 2
NOTICE SERVED BY DS for the Respondent(s) No. 1
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CORAM:HONOURABLE MRS. JUSTICE M. K. THAKKER
Date : 15/09/2025
COMMON ORAL JUDGMENT
1 Rule, returnable forthwith. Learned advocates for the respective respondents waive service of notice of Rule.
2 Since the issue raised in the these petitions are Page 1 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined similar, they are being decided by a common judgment. The facts of Special Civil Application No. 7870 of 2025 are taken for the purpose of adjudication.
3 This petition is filed challenging the award dated 04.10.2024 passed by the learned Labour Court, Valsad, whereby the termination of the petitioner was held to be illegal and a lumpsum compensation of Rs.1,00,000/- was awarded in lieu of reinstatement and backwages.
4 As per the case of the petitioner before this Court, the dispute was raised by the workman under Section 2A of the Industrial Disputes Act, 1947 (hereinafter referred to as 'the I.D. Act') seeking reinstatement with backwages from the date of termination i.e. 22.03.2020, which came to be referred to the learned Labour Court, Valsad by the Assistant Labour Commissioner on 23.03.2021. Initially, the proceedings were instituted against the principal employer and the contractor, namely Kaushal Agency; subsequently, Yashraj Agency was also impleaded under Section 10(1) of the I.D. Act. It appears that six different workmen approached the learned Labour Court by filing separate References against the contractors, namely Kaushal Agency, Page 2 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined Yashraj Agency, and R.M. Enterprise. In the present case, the petitioner appeared before the Reference Court and adduced evidence through one Vipulbhai Subhashbhai Mistry, proprietor of Yashraj Agency, who was also cross-examined by the concerned workman. Upon consideration of the evidence on record, the learned Labour Court passed the award in favour of the respondent, directing the present petitioner-contractor to pay lumpsum compensation in lieu of reinstatement and backwages, which award is under challenge before this Court.
5 Heard the learned advocate Ms.Mita Panchal for the petitioners and learned advocate Mr.Divyang Ramani for the respondent No.2 and learned advocate Mr.Sunil Agarkar for the respondent No.3.
6 Learned advocate Ms. Mita Panchal for the petitioner submitted that the contract with the petitioner- Kaushal Agency was executed for supplying manpower during the period between 2012 to 2016. It is submitted by the learned advocate Ms. Panchal that after 2016 the said contract was not extended any further; however, as per the claim of the workman, the termination is alleged to have taken place on 22.03.2020. Thus, instead of granting relief against the principal employer, the learned Labour Page 3 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined Court has erroneously saddled the petitioner- contractor with the liability to pay lumpsum compensation.
6.1 Learned advocate Ms. Panchal further submitted that as per the averments made in the statement of claim, the workman himself alleged that he was working under the principal employer, namely J.K. Files (India) Limited. The record reflects that the contractors were engaged by the principal employer, and under different contractors, wages were being disbursed. It is contended by the learned advocate Ms. Panchal that the alleged termination was claimed against the principal employer; however, the impugned award has wrongly fastened the liability upon the contractor. It is further submitted that during the cross- examination of the concerned workman, it was admitted that no documentary evidence was adduced to establish any claim against the petitioner-contractor, and therefore also impugned award deserves interference.
6.2 It is submitted by the learned advocate Ms. Panchal that as per the agreement forming part of the record, no fresh contract was executed after 2016. The licence produced before the Labour Court at Exh. 18/2 also corroborates that the Page 4 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined contract had expired on 27.06.2016. She further relied upon the evidence adduced by the workman in Special Civil Application No.10258 of 2025, wherein the workman categorically denied working with the contractor, though such opportunity was offered. In that background, it was urged that the petitioner could not have been held liable for payment of lumpsum compensation.
6.3 Learned advocate Ms. Panchal further pointed out that though the Reference was initially filed against the principal employer and Kaushal Agency, in Special Civil Application No.10258 of 2025, Yashraj Agency was sought to be impleaded. However, without any formal order of the Labour Court, the cause title of the Reference came to be amended to include Yashraj Agency. Despite the claim being raised both against the principal employer as well as the petitioner, the Labour Court proceeded to hold that the respondent was a workman of the contractor, thereby fastening liability on the petitioner alone.
6.4 It is submitted by the learned advocate Ms. Panchal that the Labour Court has relied solely on the evidence of the petitioner's witness, Nikulbhai Mistry, and on the presumption that since common Page 5 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined evidence was adduced, the proprietors of all the agencies were connected with each other. Ms. Panchal argued that even if the proprietor happened to be a family member of another contractor, in the absence of any relief sought against the said contractor, the petitioner could not have been held liable for payment of lumpsum compensation. On these grounds, learned advocate Ms. Panchal has prayed for quashing and setting aside the impugned award and for allowing the present petition.
7 Per contra, learned advocate Mr. Sunil Agarkar appearing for the principal employer submitted that the contract for supply of manpower was executed between the principal employer and Kaushal Agency during the period from 2012 to 2016. It is pointed out that the proprietor of Kaushal Agency was Mr. Himanshu Mistry, and thereafter, the contract was allotted to his brother, Mr. Nikulbhai Mistry, proprietor of Yashraj Agency, for the period between July 2016 to March 2020. It is further submitted by the learned advocate Mr. Agarkar that for the period from 2019 to 2020, the contract was awarded to R.M. Enterprise, which is a proprietorship concern of Smt. Minalben H. Mistry, wife of Mr. Himanshu Mistry, proprietor of Kaushal Agency.
Page 6 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined 7.1 Learned advocate Mr. Agarkar further submitted that the concerned workman had in fact worked under the contractor, which fact also stood admitted during his cross-examination. Therefore, the learned Labour Court, while allowing the Reference, has rightly directed the concerned contractor to pay lumpsum compensation. Learned advocate Mr. Agarkar has submitted that the evidence in all the References was adduced through Mr. Mistry, proprietor of Yashraj Agency, who appeared not only on behalf of Yashraj Agency, but also on behalf of Kaushal Agency as well as R.M. Enterprise.
7.2 It was further contended by the learned advocate Mr. Agarkar that though Yashraj Agency was impleaded as a party, Mr. Mistry, despite having appeared before the learned Labour Court on behalf of all the three contractors, did not adduce any evidence specifically on behalf of Yashraj Agency. After a detailed evaluation of the oral and documentary evidence on record, the learned Labour Court directed the present petitioner to pay lumpsum compensation. Therefore, according to the learned advocate Mr. Agarkar, the award does not suffer from any Page 7 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined infirmity, and no interference is warranted. Accordingly, the petition is required to be dismissed.
8 Learned advocate Mr. Divyang Ramani, appearing for the concerned workman, submitted that the workman had initially joined duties with the principal employer through the contractor, namely Kaushal Agency. It was further contended by the learned advocate Mr. Ramani that upon change of contractors, the wages of the workman came to be disbursed under the names of Yashraj Agency and R.M. Enterprise. Learned advocate Mr. Ramani has submitted that since the workmen had continuously worked under different contractors, all of whom belong to the same family, the learned Labour Court was justified in directing the present petitioner- contractor to pay lumpsum compensation. He, therefore, submitted that the award does not call for any interference and the present petition deserves to be dismissed.
9 Having considered the arguments advanced by the learned advocates for the respective parties if one would refer the facts of each case then it emerges as under:
9.1 Special Civil Application No.8006 of 2025 has Page 8 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined been filed by the contractors, namely Kaushal Agency and Yashraj Agency, challenging the award of the learned Labour Court dated 04.10.2024, whereby the petitioners have been directed to pay lumpsum compensation of Rs.1,00,000/-. In the course of oral evidence, the concerned workman admitted that she was being paid daily wages of Rs.324/- by Kaushal Agency. It was further admitted that the identity card was issued by the contractor and that her services came to be terminated by Kaushal Agency on 22.03.2020. The Reference was filed against the present petitioners along with the principal employer, namely J.K. Files (India) Limited.
9.2 In Special Civil Application No.7870 of 2025, also filed by the very same petitioners challenging the award dated 04.10.2024, the workman concerned similarly admitted in his deposition that he had worked under Kaushal Agency and that his services were terminated by the said contractor. The award therein also directed the petitioners to pay lumpsum compensation of Rs.1,00,000/-.
9.3 In Special Civil Application No.8007 of 2025, preferred by Kaushal Agency and Yashraj Agency, the evidence of the concerned workman was also on similar lines, namely, that he had completed Page 9 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined 240 days of service under Kaushal Agency and that his services were terminated by the said contractor.
9.4 In Special Civil Application No.8018 of 2025, also filed by the same contractors, the workman alleged to have completed 240 days of service under Kaushal Agency. It was further deposed that after the COVID-19 lockdown her services were terminated and she was not taken back in service. She also stated that she was working as a helper and her wages were being paid by the contractor.
9.5 In Special Civil Application No.7887 of 2025, filed by Kaushal Agency and Yashraj Agency, the concerned workman admitted in her testimony that her wages were paid by Kaushal Agency and that her services were terminated by the said Agency.
9.6 Special Civil Application No.10258 of 2025 has been filed by R.M. Enterprise challenging the award of the learned Labour Court dated 04.10.2024, whereby the petitioner-Enterprise has been directed to pay lumpsum compensation of Rs.1,00,000/-. The concerned workman, in her deposition, admitted that her salary was paid by R.M. Enterprise and that her services were Page 10 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined terminated by the said Enterprise. It also came on record during cross-examination that though an offer of re-employment was made by R.M. Enterprise, she refused to accept the same as she was not willing to resume duty at the place where she was offered work.
10 As against the above, if the evidence adduced on behalf of the petitioner-contractors is examined, it emerges that common evidence was led by one Mr. Mistry, proprietor of Yashraj Agency. He deposed on behalf of Kaushal Agency as well as R.M. Enterprise, but significantly, though he himself was the proprietor of Yashraj Agency, he did not step into the witness box in that capacity. In his deposition, he admitted that the workmen concerned were engaged by the contractors since 2012 and were deputed to the principal employer, namely J.K. Files (India) Limited. He further stated that after the outbreak of COVID-19, the principal employer did not extend the contract with the contractors. With regard to compliance of the provisions of the I.D. Act, the witness expressed unawareness.
10.1 It was also admitted that the attendance of the workmen was marked by the contractor and that the wages were paid by the contractor. He further Page 11 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined admitted that since the workmen were women, if any suitable work was available, the contractors were ready to offer the same. He candidly admitted that the offices of all three contractors, namely Kaushal Agency, Yashraj Agency, and R.M. Enterprise, are situated at the same place i.e. Shop No.5, BDCA Shopping Centre, Valsad. He also admitted that the main business of all the contractors is to supply of labour and that they are engaged in supplying manpower to four different institutions. The witness further admitted that the proprietor of Kaushal Agency is Himanshu Mistry, who is his elder brother, and that both of them are engaged in the same business of labour supply. It also transpired from his evidence that the proprietor of R.M. Enterprise is the wife of Himanshu Mistry.
11 From the above evidence, it clearly emerges that all three petitioners, namely Kaushal Agency, Yashraj Agency, and R.M. Enterprise, are owned and managed by members of the same family. As per the submissions advanced on behalf of the principal employer, the contract for supply of labour was awarded successively to these agencies; however, in substance, the work for all agencies was being carried out under the management of Mr.Mistry, Page 12 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025 NEUTRAL CITATION C/SCA/7870/2025 JUDGMENT DATED: 15/09/2025 undefined proprietor of Yashraj Agency. It further stands undisputed that the workmen concerned were engaged by the contractors, inasmuch as the wages were admittedly paid by them and even the identity cards were issued by the contractors themselves.
12 In the aforesaid background, the learned Labour Court cannot be said to have committed any error in directing the contractors to pay lump sum compensation of Rs.1,00,000/- to each workman, and this Court does not find any infirmity in the impugned award.
13 Resultantly, these petitions are dismissed. Rule is discharged.
(M. K. THAKKER,J) M.M.MIRZA Page 13 of 13 Uploaded by M.M.MIRZA(HC01407) on Wed Sep 17 2025 Downloaded on : Wed Sep 17 23:17:45 IST 2025