Madras High Court
Food Corporation Of India Workers ... vs Food Corporation Of India on 16 February, 2021
CRP(NPD).No.741 of 2018
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 16.02.2021
CORAM
THE HON'BLE MR. JUSTICE KRISHNAN RAMASAMY
C.R.P.(NPD).No.741 of 2018
and C.M.P.No.3781 of 2018
1.Food Corporation of India Workers Union,
Tamil Nadu Region,
Rep. by its Vice President, I.Selvaraj
2.Food Corporation of India Workers Union,
Rep. by its President,
Vanarapet, Puducherry.
3.Food Corporation of India Workers Union,
Rep. by its President,
Kovilpathu, Karaikal,
Puducherry.
4.Food Corporation of India Workers Union,
Rep by its President,
Thiruvandarkoil, Puducherry. ...Petitioners
Vs
1.Food Corporation of India,
Public Sector Undertaking,
Food Storage Depot, Puducherry
Rep by its Area Manager K.Sathya Kumar,
1/18
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CRP(NPD).No.741 of 2018
2.Employees State Insurance Corporation,
Puducherry. ... Respondents
Prayer Civil Revision Petition filed under Article 227 of Constitution of India,
prayed, to set aside the order dated 27.01.2016 of the Employee's Insurance
Court, Puducherry in I.A.No.4 of 2015 in unnumbered ESI OP of 2015 to
restore the same.
For Petitioners : Mr.R.Srinivas
For R1 : Mr.S.Vijayakumar
For R2 : Mr.S.P.Srinivasan
ORDER
This Civil Revision Petition has been filed against the order dated
27.01.2016 made in I.A.No.4 of 2015 in unnumbered ESIOP of 2015 on the file
of the Employee's Insurance Court, Puducherry.
2.The Court below has passed the following order in the said IA:
“This is a petition filed under Section 75(2-B) of the ESI
Act, 1948 read with Section 151 of C.P.C praying an order for
waiving or substantially reducing the amount to be deposited in
terms of the provisions of the Section 75(2-B) of the ESI Act, for
filing the original petition.
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CRP(NPD).No.741 of 2018
2.Today when the petition came by for hearing, in view if
the endorsement made by petitioner's counsel, this IA is
dismissed as not pressed. No costs”
3.The learned counsel for the petitioners submitted the 1st respondent
appeared before the Court below and made an endorsement for withdrawing the
said IA. The Court below also permitted to withdraw the same without hearing
the Workers Union. He further submitted that since ESIOP was filed seeking
prayer to hold that the labourers employed by the 1 st respondent, in respect of
whom the impugned order has been issued, are not coverable under the ESI Act
1948 and to set aside the order bearing No.TN/INS/VI/51-51-102876-001-0099/
C19 dated 04.09.2014 for a sum of Rs.8,26,821 for a period from 01.01.2011 to
31.03.2014, the petitioners herein ought to have heard before dismissing the
said IA.
4.The learned counsel further submitted that the employees of the
Workers Union are NWNP (No Work No Pay) employees and these workers are
not a casual or a contract labour to qualify and avail benefits under the ESI Act.
These workers are provided Provident Fund, Gratuity, Bonus and Pensional
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CRP(NPD).No.741 of 2018
benefits and they are entitled for the weekly off etc. Therefore, they are not at
all the casual labour and ESI Act will not be applicable for them. Hence, the
withdrawal of the said I.A.No.4 of 2015 is a direct bearing on the interest of the
NWNP workers since the challenge was made against the impugned order dated
04.09.2014 issued by the ESI Corporation, whereby directing the Food
Corporation of India to deposit a sum of Rs.8,26,821 for a period from
01.01.2011 to 31.03.2014. When the stand of the revision petitioners herein is
that the ESI Act itself does not applicable for these employees, then the
question of deposit does not arise at all and therefore, the Workers Union ought
to have been heard and without hearing them the Court below permitted the
Food Corporation of India to withdraw the said IA, which is against the
principles of natural justice, and law laid down by the Hon'ble Apex Court.
5.The learned counsel further submitted that the Madurai Bench of this
Court in C.M.A.(MD).No.534 of 2017 dated 06.11.2017 held that NWNP
workers are not casual or contract workers, they are regular workers with
benefits such as Provident Fund, Gratuity, Bonus, Production linked incentives,
Leave etc., The Hon'ble Supreme Court vide order dated 19.11.2019 in Civil
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CRP(NPD).No.741 of 2018
Appeal No.8841 to 8842 of 2019 upheld the judgment of this Court made in
C.M.A.(MD).No.534 of 2017 dated 06.11.2017.
6.Further, he referred the Paragraph No.8 of the judgment of the Hon'ble
Supreme Court in the case of ESI Corporation vs Bhakra Beas Management
Board reported in 2009 10 SCC 671, which is extracted hereunder:
“8.In our opinion, wherever any petition is filed by an
employer under Section 75 of the Act, the employer has not only
to implead ESIC but has also to implead at least some of the
workers concerned (in a representative capacity if there are a
large number of workers) or the trade union representing the said
workers. If that is not done, and a decision is given in favour of
the employer, the same will be in violation of the rules of natural
justice. After all, the real parties concerned in labour matters are
the employer and the workers, ESI Corporation will not be in any
way affected if the demand notice sent by it under Sections 45-
A/45-B is quashed.”
By referring above, he submitted that it is just and necessary to implead
the workers or their union and they have to be heard. In the present case, when
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CRP(NPD).No.741 of 2018
the interest of NWNP workers are going to be affected by the withdrawal of the
I.A.No.4 of 2015 and ESI OP, the Court below ought to have heard the workers
union, as such they have not been heard by the Court below therefore, he
submitted that order in the said IA is liable to be set aside and prayed to allow
the Civil Revision Petition.
7.Mr.S.Vijayakumar, the learned counsel for the first respondent fairly
submitted that NWNP workers are regular employees, they are not at all casual
or contract workers. The learned counsel referred paragraph No.17 of the
judgment dated 16.11.2017 made in C.M.A.(MD).No.534 of 2017, which is
extracted hereunder:
“17.Shri.Vijayakumar, learned counsel for the Food
Corporation of India fairly admitted that DPS employees cannot
be termed as casual labour or contract workers. A casual worker
in the very nature of things is employed for the day. There is no
permanency attached to his status. They are conferred with a
number of benefits such as Gratuity, Bonus, Production linked
incentives, leaves etc., More than anything else, there is even a
scheme for compassionate appointments. In other words, if a
DPS employee dies in harness, his dependent is given
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CRP(NPD).No.741 of 2018
appointment on compassionate grounds. Therefore, by no stretch
of imagination can he be called as casual or contract labour.”
By referring the above judgment, he confirms his stand that the NWNP
workers are permanent workers. Further he reiterated that ESI notification dated
20.07.2009, and submitted that as per the said notification only casual or
contract laboures are alone covered under ESI Act. He further submitted that
the Food Corporation of India have been providing better facilities than the
facilities provided under ESI, to NWNP workers. At any cost, the interest of its
employees will not be affected in any way as they have been protected with
better facilities. Therefore, he submitted that NWNP workers cannot be covered
under ESI.
8.The learned counsel for the second respondent strongly opposed the
submissions made by the learned counsel for the petitioner and the 1st
respondent and submitted that these workers are covered under ESI and by
referring the bipartite agreement dated 02.09.2011, he submitted that the
bipartite agreement was made to cover the NWNP Workers under ESI Act. He
further referred the notes issued by Food Corporation on various labours system
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CRP(NPD).No.741 of 2018
in FCI depots and submitted that DPS workers had been given benefits of CPF
in addition to the benefits of Ex-Gratia / Gratuity / Workmen's Compensation,
Paid Weekly off, National Holidays, Sick Leave, Medical First Aid and Medical
Facility (Indoor/Outdoor) under ESI Act. Therefore, the NWNP workers of
Food Corporation of India are covered under ESI. Further the said I.A., was
filed by the Food Corporation of India and they are entitled to withdraw the
same. He further submitted that the Circular No.14 of 2011 is not at all referred
in the judgment passed by Madurai Bench of this Court in C.M.A.(MD).No.534
of 2017 as well as in the judgment of the Hon'ble Apex Court in Civil Appeal
No.8841 to 8842 of 2019. Hence, the Civil Revision Petition is liable to be
dismissed.
9.Heard the learned counsel for the petitioners as well as the respondents
and perused the materials
10.This Civil Revision Petition filed challenging the order passed in
I.A.No.4 of 2015. A perusal of the notification dated 20.07.2009 of the ESI
would show that ESI Act will apply to all the casual or contract labours of the
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CRP(NPD).No.741 of 2018
Food corporation of India. In the present case, the issue has to be decided is as
to whether NWNP employees comes under the category of either under casual
or contract labour. In this regard, this Court already has taken a decision in a
similar case filed by FCI Workers Union, wherein this Court held that NWNP
workers are the regular workers and they are not casual or contract workers.
11.As contended by the learned counsel for the petitioners the Madurai
Bench of this Court in C.M.A.(MD).No.534 of 2017 dated 06.11.2017 held that
NWNP workers are not casual or contract workers, they are regular workers
with benefits such as Provident Fund, Gratuity, Bonus, Production linked
incentives, Leave etc., The Hon'ble Supreme Court vide order dated 19.11.2019
in Civil Appeal No.8841 to 8842 of 2019 upheld the judgment of this Court
made in C.M.A.(MD).No.534 of 2017 dated 06.11.2017.
12.The learned counsel for the first respondent, the Food Corporation of
India also stated that NWNP workers are the regular workers and they are to be
provided benefits such as Provident Fund, Gratuity, Weekly Holidays and all
other Pensionary benefits. That apart, they are also provided compassionate
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CRP(NPD).No.741 of 2018
appointment to the dependent family members of the workers in case of any
harness and therefore he submitted that they are only regular workers.
13.The Madurai Bench of this Court as well as the Hon'ble Apex Court
has taken a view that NWNP workers are the regular workers but not the causal
or contract labours, when such a view has already been taken in a similar
situation against the NWNP workers of the Food Corporation of India,
Tuticorin, this Court cannot take a different view on that score.
14.The learned counsel for the Second respondent submitted that the
Circular No.14 of 2011 dated 02.09.2011 issued by the Food Corporation of
India was not brought in to the knowledge of the Court when
C.M.A.(MD).No.534 of 2017 was heard and also before the Hon'ble Apex
Court when the above C.M.A was Challenged. Therefore, this Court and the
Hon'ble Apex Court had no opportunity to deal with the agreement entered by
the Food Corporation of India with its Workers Unions. According to the
Second respondent, if this Circular was considered by the Madurai Bench of
this Court as well as by the Hon'ble Apex Court, they would not have passed a
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CRP(NPD).No.741 of 2018
different order holding that ESI Act will apply to NWNP workers. Therefore,
since this Circular had not been brought into the knowledge of the Hon'ble
Apex Court as well as before the Madurai Bench of this Court the order passed
in the above CMA will not be applicable for the present case and he insist to
pass fresh order considering the Circular No.14 of 2011.
15.This Court has gone through the circular and upon perusal, it appears
that this circular was issued, wherein it has been stated that the bipartite
settlement was signed with FCI Workers Union on 11.05.2011 and the same
was also registered under Industrial disputes Central Rules, wherein, it has been
agreed that DPS/NWNP system labourers will be extended benefits of the
Medical Health care Scheme as per the provisions of ESI Act 1948. This was
the settlement deed between Workers Union and FCI. It is a bipartite
agreement, where ESI is not a party to this agreement. At this juncture, it would
be appropriate to extract the notification dated 20.07.2009 issued by the
Ministry of Labour and Employment. The relevant portion of the notification is
reproduced hereunder:
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CRP(NPD).No.741 of 2018
Description of the Area in which the Category of employees to
Establishments Establishments are situated whom the Act applies
The following All areas where the provisions All casual and Contract
establishments belonging of the ESI Act 1948 have Employees.
to or under the control of already been brought into
the Central Government force under Section 1(3) of
wherein twenty are the Act.
employed or were
employed for wages on
any day of the preceding
twelve months namely,
i)
ii)
.........
viii) Establishments
engaged in Insurance
Business, other than Non-
Banking Financial
companies (NBFC), Port
Trusts, Airport Authorities
AND WAREHOUSING.
In the present case, NWNP employees are comes under the category of
regular employees. As per above circular, the ESI Act will apply only to all
casual and contract employees of the FCI. However, the bipartite agreement
was entered between FCI and its Workers Union without including ESI as party
to the bipartite agreement. The said bipartite agreement was made to provide
coverage under ESI and as per the above notification, the ESI Act will apply
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CRP(NPD).No.741 of 2018
only to the casual and contract employees. When such being a position, the
application of ESI Act to NWNP workers who are being regular employees do
not arises. Therefore, the bipartite agreement was entered without taking note
of this fact.
16.It was also brought into the knowledge of this Court that Paragraph
No.6 of the Circular No.14 of 2011, dated 02.09.2011, whereby the Medical
Health Care Scheme vide Circular No.10 of 2005 dated 23.08.2005 has been
withdrawn immediately at the pilot location after the coverage of DPS workers
in Medical Health Scheme of ESIC. A perusal of the said paragraph would
show that the scheme has been withdrawn after the coverage of DPS workers in
Medical Health Scheme.
17.As this NWNP employees are regular employees, the FCI and its
Workers Union ought not to have entered this bipartite agreement when ESI Act
does not permit any coverage for the regular employees and in such
circumstances, any such circular issued by withdrawing the benefits by virtue of
the bipartite agreement, will not be legally sustainable as far as the applicability
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CRP(NPD).No.741 of 2018
of ESI Act to NWNP employees are concern. If any such withdrawal of the
benefit in terms of clause 6 of the Cricular No.14 of 2011, it is for the Food
Corporation of India to restore it and make it available all benefits for the
NWNP workers with immediate effect.
18.A perusal of the notification dated 20.07.2009, would show that the
benefits available under ESI will be applicable only to the causal labour or
contract labour. In the present case, it is crystal clear that the NWNP workers
neither a causal nor a contract labours. They have been provided all the
benefits which would be provided to the regular employees including
Compassionate Appointment, Pensionary Benefit, Gratuity, Leave Salary,
Weekly off. When such facilities have been provided, there is no justification
to treat the NWNP workers either as causal or the contract labour and to compel
them to bring them under the ESI Act.
19.The main issue to be decided in this matter is as to whether the Food
Corporation of India can withdraw I.A.No.14 of 2015 without hearing the
Workers Union? In a similar circumstances, the Hon'ble Apex Court in Bhakra
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CRP(NPD).No.741 of 2018
Beas Management Board case, referred supra, held that wherever any petition
is filed by an employer under Section 75 of the Act, the employer has not only
to implead ESIC but has also to implead at least some of the workers concerned
(in a representative capacity if there are a large number of workers) or the trade
union representing the said workers. If that is not done, and a decision is given
in favour of the employer, the same will be in violation of the rules of natural
justice.
20.In the present case, obviously while permitting the Food Corporation
of India to withdraw I.A.No.4 of 2015, the Workers Union have not been heard
as per the law laid down by the Hon'ble Apex Court. The Court below should
have heard the grievances of the Workers Union while permitting to withdraw
the said I.A. A mere perusal of the order would show that no such opportunity
was provided to the Workers Union to explain their case before permitting to
withdraw the said I.A. The challenge under ESIOP was only against the
demand made by the ESI Corporation to pay the contribution for the NWNP
workers. Therefore, as stated earlier, in the present case, the withdrawal of the
said I.A will affect the interest of the workers. As held by the Madurai Bench of
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CRP(NPD).No.741 of 2018
this Court and Hon'ble Apex Court the NWNP workers are the regular workers
and they are not either casual labour or contract labour so as to cover under the
provisions of ESI. Thus, obviously it is for the Workers Union to protect the
interest and its workers, at the time of hearing the application filed by the Food
Corporation of India.
21.Hence, this Court is of the opinion that the order passed by the Court
below in I.A.No.4 of 2015 deserves to be set aside. Accordingly, the order
passed by the Court below in I.A.No.4 of 2015 in unnumbered ESI OP of 2015
is set aside and I.A.No.4 of 2015 is restored. The Court below is directed to
hear the Workers Union before passing any order in I.A.No.4 of 2015 pending
before the Employee's Insurance Court, Puducherry.
22.In the result, this Civil Revision Petition is allowed. No costs.
Consequently, connected miscellaneous petition is closed.
16.02.2021
Index: Yes
Internet:Yes
Speaking order
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CRP(NPD).No.741 of 2018
To:
The Employee's Insurance Court, Puducherry.
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CRP(NPD).No.741 of 2018
KRISHNAN RAMASAMY,J.
rst
C.R.P.(NPD).No.741 of 2018
and C.M.P.No.3781 of 2018
16.02.2021
https://www.mhc.tn.gov.in/judis/
