Union Of India Thru Genral Manager ... vs N.E.R. Employees Union(Prks) ...
2019 Latest Caselaw 5442 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
 
 

AFR
 
Court No. - 25
 
Case :- MISC. SINGLE No. - 1806 of 2015
 
Petitioner :- Union Of India Thru Genral Manager N.E.R. Gorakhpur & Anr
 
Respondent :- N.E.R. Employees Union(Prks) Gorakhpur Thru Branch Secy.&Ors
 
Counsel for Petitioner :- Chandra Shekhar Sinha
 
Counsel for Respondent :- Akhil Pratap Singh,Chandra Bhushan Pandey,H.A.B.Sinha
 
Hon'ble Mrs. Sangeeta Chandra,J.

Oral

1. The petitioners have challenged the Award passed by the Presiding Officer, CGIT, Lucknow dated 20.8.2014 on a Reference being made to it on 8.1.2002 in a dispute between the North-Eastern Railways Employees Union (PRKS), Gorakhpur and the General Manager, North-Eastern Railways, Gorakhpur. The Reference under adjudication is as follows:-

"Whether the action of the management of Northern-Eastern Railway, Gorakhpur in not regularising the services of 12 workmen as per list submitted by the Union (enclosed herewith) as Railway servant and also terminated them from the services w.e.f. 4.7.1990 are legal and justified? if not, what relief the workmen are entitled?"

2. The case set up by the workmen's union was that the Railway Mens Consumer Cooperative Society Ltd., a society registered under the Cooperative Societies Act for

North-Eastern Railways, Gorakhpur runs nine canteens with the cooperation of the officers of the Railway. The Society collects subscription from the employees of the Railways and deposits a part of the same to the Railways and in turn of Railways provide salary and other benefits to the employees of the Society after adding a specified amount of subsidy to such subscription amount. The account sof all the units canteens of the Society were regulated by the Railways under the directions of the Railway Board. There were seventy six sanctioned employees in the Society, but from time to time because of transfer or for other reasons, the number of employees fell short of sanctioned strength. The Society in question had a Committee of Management which was superseded and the Registrar, Firms, Societies & Chits had appointed an Administrator to look after the affairs of the Society? At the time when the Administrator was appointed by the Registrar, there were fifty eight employees in the Society and the Administrator had appointed eighteen more employees after approval from the General Manager, North-Eastern Railways.

3. It was submitted that as per the law settled by the Hon'ble Supreme Court in M.M.R. Khan Vs. Union of India, AIR 1990 SC 937 employees of statutory canteens run by the Railways and even non statutory canteens run for the benefit of Railways employees and recognised by the Railway were entitled for regularisation and consequential service benefits w.e.f. 1.4.1990.

4. After the said judgment, the Railway had absorbed only fifty eight employees and terminated the services of the eighteen employees by adopting pick and choose method. One employee, namely, Dhunai whose name found place at serial no. seventy two of the list was absorbed ignoring the case of several persons mentioned in the claim petition, viz Mohd Sagir Khan, Ram Dev, Panpal Prasad, Ramakant Nishad, Kaushal Kishore Mishra, Promod Kumar Singh, Hari Shankar Ram, Subhash Chandra, Tirthraj Giri, Buddhi Ram, Surya Bhan and Chandarma Prakash Mishra who were senior to Dhunai and were entitled for being regularised.

5. The workmen's union submitted that all twelve workers whose services were terminated had been engaged before the cut off date of 1.4.1990 and were entitled to be regularised having been appointed by the Administrator who was authorised to make such appointments. The action of oral termination of the said employees by the Railways w.e.f. 4.7.1990 was arbitrary, and therefore ought to be set aside, and the workmen should be regularised with consequential benefits including full back wages.

6. The management of North-Eastern Railways had filed its written statement disputing the claim made by the workmen through their union. It was contended before the CGIT that the workmen were employees of the Society and not of the Railways, therefore there arose no question of terminating their service. With regard to their non regularisation, it was submitted that subsidy was being given to the Cooperative Society for running the canteen so that salary of employees of such canteens could be given.

7. However, if any workmen were engaged without prior approval of the Railways, it had no responsibility of giving subsidy or considering their regularisation. Since, the workmen under dispute were appointed in an unapproved category by the Administrator of the Society, they were not regularised. Also, the case of Dhunai was differentiated and it was mentioned that Dhunai was given fresh appointment and was not regularised.

8. The workmen's Union had examined the workmen concerned whereas the Railways had examined the Senior Personnel Officer, and the Administrator of Railway Mens Consumer Cooperative Society Ltd., Shri Vishwamitra Mishra - the Superintendent, CPO office in support of their respective claims.

9. The CGIT was informed by the Railways that the number of sanctioned employees was fifty eight before 1.4.1990, and therefore only fifty eight employees were absorbed.

10. The Administrator of the Cooperative Society - Shri Vishwamitra Mishra however in his statement before the CGIT had admitted that at the time of his appointment by the Registrar as Administrator, there were fifty eight employees, but after his appointment, with the approval of the General Manager, North-Eastern Railways, he had made eighteen more appointments taking the number to seventy six. He had also admitted that Dhunai, was junior to the workmen in the dispute and had been regularised. The discharge of other employees from the canteen was made without giving prior notice or compensation to such workmen.

11. The Senior Personnel Officer, Shri Anuiya Ram the management witness, had stated that the Railway Board had issued a Circular on 13.4.1987 whereby it had notified that there should not be any increase in the number of employees in the canteen, and therefore the Administrator could not have made appointments beyond the sanctioned strength without prior approval from the Railway Authorities. It was stated that all workmen who had come before the CGIT had been engaged in contravention of directions issued in the Railway Board's letter dated 13.4.1987.

12. The CGIT considered the rival submission and also the language of the letter of the Railway Board dated 13.4.1987 by quoting the same in its Award. The relevant extract of the language is being quoted herein below:-

"Attention is invited to the provisions contained in para 2031 of the Indian Railway Establishment Manual, Governing the principles for setting up of canteens on the Railways which interalia lay down that "any scheme for the provision of new canteens should be submitted to the Board for approval indicating the financial implications duly vetted by the FA & CAO". Further, instructions were conveyed vide Board's letter No. E(W) 63CN1-2 dated 9.7.63 specifically in respect of non statutory canteens provided other than under the Factories Act, 1948.

The Board desires that the above instructions should be reiterated to the Zonal Railways etc. to ensure full compliance with the Manual provisions. Accordingly, no commitment should be made nor expenditure incurred for setting up of new statutory / non statutory canteens as also increase in the staff strength in any of the existing canteens without Board's prior approval."

(emphasis supplied)

13. The CGIT found from a perusal of the letter dated 13.4.1987 that the said instructions were relevant only for the purpose of setting up of new statutory / non statutory canteens and not for the appointment of employees in such canteens already in existence. It also considered the fact that the Administrator had been authorised to make such appointment in the canteen. It also considered the fact that the Railway had paid salary to the workmen in question as per the documents filed at Paper No. C-81 to C-90 to the paper book.

14. The management witness in his Examination-in-Chief had stated that in the salary bill for the month of March, 1990, the names of eighteen persons had been added to give them undue benefit by the Administrator, but payment of subsidy with respect to the increased number of workmen was not made by the Railways. The CGIT came to the conclusion that there was no evidence on record to show that the Railways took any corrective measure against the payments made to such increased number of employees made in excess of the sanctioned strength.

15. It also referred to the regularisation of Dhunai and the admission on the part of the management witness, Shri Vishwamitra Mishra, the Administrator of the Society, that Dhunai was junior to the workmen under dispute.

16. It observed that in case workmen engaged by Sri Vishwamitra Mishra after 1988 were all in excess of the sanctioned strength none of them should have been regularised, however Dhunai was regularised. It therefore allowed the claim petition and answered the Reference in favour of the workmen. It directed that all workmen in dispute were required to be regularised in terms of the orders passed by the Supreme Court in M.M.R. Khan (supra) after 1.4.1990 and that their termination w.e.f. 3.7.1990 was illegal and unjustified, therefore they were entitled for reinstatement and regularisation from the date when the canteen was taken over by the

North-Eastern Railways.

17. It has been argued by Sri Chandra Shekhar Sinha on the basis of judgment rendered by the Hon'ble Supreme Court in M.M.R. Khan (supra) that the cut off date for the employees of non statutory recognised canteens to be considered for regularisation was 1.4.1990, and the employees were engaged after 1.4.1990, therefore they could not be regularised.

18. It was argued that despite documentary evidence being submitted before the Tribunal to show that as on 1.4.1990 only fifty eight employees were sanctioned subsidy, and payments made, the Tribunal had misread the evidence on record and come to an entirely different conclusions on the basis of some documents filed as C-81 to C-90 by the workmen.

19. It has been submitted that even if an illegality was committed in making excess payment to such employees, who were engaged beyond the sanctioned strength, such illegality could not have been allowed to be perpetuated by the Tribunal by observing that since the Railways had not taken any action to correct the excess payment made, it cannot be said that it was not an excess payment.

20. It has also been submitted that Dhunai, the alleged junior to the workmen in dispute was given a fresh appointment and not a regularisation or absorption of service as alleged.

21. Sri Chandra Bhushan Pandey who appears for the opposite party nos. 1 & 3 had referred to his counter affidavit wherein a preliminary objection has been raised regarding the maintainability of the writ petition due to

non-joinder of necessary parties. Since, the Award had been passed with respect to twleve workmen which was challenged in this petition, all twleve workmen should have been impleaded as private respondents. Only one Mohd Sagir was impleaded as respondent no. 3.

22. It has also been argued that the writ petition was filed in April, 2015 against an Award dated 20.8.2014 and till date even without there being any interim order, the Award has not been complied with. The opposite party no. 3 had moved an complaint before the Assistant Labour Commissioner (Central) and notices had been issued to the General Manager, North-Eastern Railways for compliance of the Award, yet the Award had not been complied with.

23. It has also been argued by Sri Chandra Bhushan Pandey that under the Industrial Disputes Act, Section 17-B provides payment of current salary to the workmen in case of challenge to the Award before the High Court or the Supreme Court. The provisions of Section 17-B had not been complied with even though in the Award a direction was issued to reinstatement of the workmen in dispute and for giving them consequential benefits in terms of the orders passed by the Supreme Court in the case of M.M.R. Khan (supra).

24. Sri Chandra Bhushan Pandey has read paragraphs 30 & 31 of the judgment rendered by the Supreme Court in M.M.R. Khan (supra) wherein the Supreme Court had observed that all workers engaged in non statutory recognised canteens in the Railway Establishments are Railway employees and they are entitled to be treated as such. The employees of the other non statutory recognised canteens will be treated as Railway employees w.e.f. 1.4.1990 and they would be entitled to all the benefits as such Railway employees with effect from the such date under the relevant Rules and Orders.

25. It is undisputed that Railway Mens Consumer Cooperative Society Ltd. which was running the nine canteens under North-Eastern Railways was a recognised body by the Railways as subsidy was being paid to the Society over and above the subscription of its members to enable it to pay salary to its employees and to run the canteen. Being a recognised canteen, although a non statutory canteen one the judgment rendered in M.M.R. Khan (supra) would apply.

26. It has been submitted further by Sri Chandra Bhushan Pandey that from the documents filed before CGIT, the Railways could not show the sanctioned strength of the canteen being only of fifty eight employees. Undisputably, the payments were being made to other employees also engaged before 1.4.1990 including the workmen in question.

27. The Administrator was appointed in 1989 and he made appointment of the workmen in dispute before 1.4.1990 as is evident from the appointment letter of one of the workmen, the respondent no. 3 filed his counter affidavit.

28. It has also been submitted that the CGIT rightly interpreted the circular dated 13.4.1987 where the embargo was placed on fresh engagement only in relation to such employees who were engaged beyond the sanctioned strength. There was no embargo placed upon the Administrator of the Society for engagement of workmen within the sanctioned strength. Being engaged by the authorised person i.e. the Administrator, and being engaged before the cut off date of 1.4.1990, all the workmen were entitled to be regularised.

29. It has been submitted by Sri Chandra Bhushan Pandey that in so far as orders of the Labour Court are concerned, challenge in writ jurisdiction is entertained by the High Court on the grounds of Wednesbury principles of Judicial Review. The petitioners have been unable to show either illegality or procedural impropriety or irrationality in the Award impugned.

30. Having considered the rival submissions and also the record placed before this Court, this Court finds that the Circular dated 13.4.1987 issued by the Railway Board and its interpretation is crucial for the decision of the controversy. The language of the circular has been quoted herein above.

31. This Court finds that in the first paragraph the earlier circular issued for setting up a canteen on the Railways were pointed out and reiterated, for example, the Railway Board's Letter No. E(W) 63CN1-2 dated 9.7.1963, and it was stated that any scheme for the provision of new canteens should be submitted to the Board for approval indicating the financial implications duly vetted by the Finance and Account Officer. A further desire of the Board was mentioned in the second paragraph to the effect that no commitment should be made nor expenditure incurred for setting up of new statutory / non statutory canteens, as also increase in the staff strength in any of the existing canteens without Board's prior approval.

32. The phrase relevant for decision of the controversy is "increase in staff strength in any of the existing canteens without Board's prior approval". The staff strength referred to in the last sentence of the circular is the sanctioned strength of staff for an existing canteens.

33. The sanctioned staff strength according to Administrator was seventy four. The Administrator had appointed eighteen persons taking the existing number of employees of fifty eight to seventy six, i.e. two more employees than the sanctioned strength had been appointed by the Administrator. But in so far as others are concerned, all workmen appointed in between 1989 and 1990 who were within the sanctioned staff strength could have been appointed by the Administrator without the Board's prior approval. Only twelve such workmen had approached the CGIT and not all of the eighteen, who were appointed by the Administrator. The twelve such workmen who had approached by filing claim petition through their Union were all appointed before 1.4.1990.

34. No perversity has been shown in the Award impugned with respect to the observations made by the CGIT on the basis of documents on record. The Railways had paid salary to the workmen in question as per the documents filed as Paper No. C-81 to C-90. The CGIT has rightly come to the conclusion that all workmen before it were entitled to be regularised.

35. Although, a complaint was filed by the opposite party no. 3 to the Assistant Labour Commissioner alleging willful non compliance to the Award of the CGIT, the Railways chose not to comply with the Award despite there being no interim order from the High Court in this writ petition. The explanation submitted through supplementary affidavit by the General Manager, North-Eastern Railways for non compliance of the Award is an eye wash. It merely justifies the filing of the writ petition and repeatedly alleges that the Award is illegal, and therefore the Railways are not bound to comply with it. This kind of attitude by the Railways is not appreciated at all by this Court.

36. The writ petition is dismissed.

37. The Award of the CGIT shall be complied with forthwith by the Railways and all consequential benefits arising out of the Award shall be given to all the workmen who were engaged by the Administrator within the sanctioned strength of seventy four, within a period of three months from today. The two junior most employees amongst the list of eighteen employees engaged by the Administrator before 1.4.1990 can be valid left out by the Railways.

Order Date :- 3.7.2019

Arif