JUDGMENT
R.M. Lodha, J.
1. A batch of these eleven writ petitions involves a common question and, therefore, all these writ petitions have been hard together and are disposed of by this common judgment.
2. The twin argument which have been raised by the learned counsel for the petitioners in all these writ petitions are :-
(i) that the Mahila Griha Udyog (Lijjat) Papad Kendra, Amravati is not an “industry” when the meaning of Section 2(j) of the industrial Disputes Act, 1947; and
(ii) that, the respondents in all the writ petitions rate not “workmen” within the meaning of Section 2(s) of the Industrial Disputes Act, 1947.
On the basis of these two-fold contentions, the learned counsel for the petitioner has contended that the Award passed by the labour Court on 10.9.1990 deserves to be quashed and set aside by this Court.
3. To appreciate the aforesaid contentions. It would be advantageous to first refer to the facts which are identical in all these writ petitions. The facts are that the respondents in all these writ petitions raised the industrial dispute that though they have been working in the petitioner organisation for number of years, when they asked for bounds and other benefits from the petitioner organisation their services were terminated vide letter dated 6.3.1985 with effect from 8.3.1985 in utter disregard of law. They allege that they were active members of the General Labour Union Namuna Amravati and were trying to get their lawful rights through the Union, but petitioner organisation revangefully terminated their services. The said industrial disputes relating to the eleven employees were referred to the Labour Court. Amravati for adjudication in respect of claims of the respondents pertaining to the reinstatement in service together with payment of back wages and continuity. On reference of the aforesaid industrial disputes all the respondents filed their statements of claim. It was inter-alia stated in the statement of claim by the respondents that they have been regular and permanent workmen working with the petitioner on the job of preparation of Papads. The respondents claimed bonus, leave, wages other benefits and privileges, but the petitioner organisation did not accede to their lawful demands and by way of victimisation and in colourable exercise of employer’s right, illegally terminated their services with effect from 8.3.1985 by the letters dated 6.3.1985. The respondents sent a registered notice to the petitioner on 14.3.1985 seeking their reinstatement with continuity of service and full back wages but the petitioner did not reply. According to the respondents the termination was without proper notice and without compliance of Section 25F of Industrial Disputes Act without payment of retrenchment compensation and thus, illegal and bad in law. The respondents also submitted that before termination neither they were charge-sheeted nor any domestics enquiry was conducted against them.
4. The petitioner who was party no. 1 before the Labour Court, Filed Written Statement in all the references and pleaded that the respondents who were party no. 2 before the Labour Court, were not permanent employees/workers working regularly and continuously, as alleged. The petitioner set up the defence that neither it was “industry” nor the respondents were “workmen”. According to the petitioner, it was not a commercial establishment, but a society registered under the Societies Registration Act as a Trust and it is an institution which is run be ladies only, having its Head Office at Bombay and there are various Kendras all over country. The petitioner was one of the Kendras at Amravati with about 500 lady members who roll Papads for the Kendras. These ladies were not the employees or workers of the petitioner, but the members of the organisation. The petitioner, thus set up the defence that the provisions of the Industrial Disputes Act or other Labour Laws were not applicable and all the ladies who become members of the petitioner organisation have participation in organisation and at the time of becoming of the member, they sing declaration and their membership is accepted in the meeting of the Managing Committee and the members also attend several meeting such as distribution of profits etc. The relationship of “employer and employee” or “master of servant” was, thus, denied by the petitioner. By referring to its constitution, the petitioner submitted in the Written Statement that affairs of the Society are managed by the members of the members of the society and they elect the Managing Committee and Sahchalika and they themselves fix the rate of rolling Papads and also decide the distribution of profits amongst the members, if any. The members under-take the work of rolling the Papads at the rated fixed by themselves. They take the dough (Gola) to their home and no Papad is rolled in the premises of the petitioner and, therefore, there is no control of the petitioner over the respondents. According to the petitioner, there is no supervision or compilation of any kind on the members. On the basis of these pleadings, the petitioner contested the claim of the respondents that their services were terminated or that there was retrenchment or dismissal.
5. All the eleven references were consolidated and the Labour Court at the request of the parties, recorded the evidence in reference bearing IDA Case No. 3/86. The respondents examined two witnesses, viz, Fulabai Madhukarrao Sahare and Ratnakala Devidas Kikane. On the other hand, the petitioner examined Smt. Indumati Jagdish Deshmukh. Certain documents were placed on record.
6. The Labour Court, Amravati after herding the parties, held that the petitioner was an “industry” and respondents were “workmen” within the meaning of Section 2(s) of the Industrial Disputes Act. The Labour Court also concluded that termination of the respondents was illegal and consequently, by the Award dated 10.9.1990, answered references in affirmative and declared the termination of the respondents illegal and directed the petitioner to reinstate all the respondents with continuity of service. The petitioner was also directed to pay half back wages to the respondents.
7. Mr. S. G. Aney, the learned Senior Counsel has made two-fold submissions, as observed above. Miss N. R. Sareen, Advocated who had filed power on behalf of the respondents in all the cases, pleaded no instruction on behalf of the respondents and no other counsel appeared on behalf of the respondents.
8. Certain more facts which are reflected from the memorandum of association, articles of association of the petitioner and the declaration sought for by the petitioner from the members at the time of admission in the organisation, may be noted before I consider the contentions raised by the learned counsel for the petitioner.
9. In the year 1959, Shri Mahila Griha Udyog Lijjat Papad came into existence and on 25th July 1966, the petitioner was registered as Society under the Societies Registration Act as well as under the provisions of the Bombay Public Trusts Act, 1950. With a view to raise the standard of living of women, to undertake the activities in connection with the village Industries and to make beginning with Papad making, the petitioner society was registered. According to its constitution, women who can contribute their physical labour not younger than 15 year and abide by the objectives of the petitioner society could become member and any woman who starts working with the petitioner society, becomes its member and as a member, she is required to sign a declaration. The material contents of the said affidavit are that such lady she would take over work of organisation as the work of God and whatever remuneration (Prasad) she gets, would be accepted gladly by her. She would prepare at least 3 kg. Papads daily. According to the Articles of Association, the membership shall be cancelled on the death of member, resignation of the member duly accepted by the Managing committee or dismissal of the member who was behaving against the objectives of the organisation and whose activities were harmful to the organisation and who is not of sound mind or who was carrying on the manufacturing of Papad or Papad of the type of the petitioner organisation or who stops working for the petitioner organisation. The Branches of the Institution and its Management are defined in Article 3 of the Articles of Association and it is provided that the managing Committee has power to appoint, suspend or dismiss any employee in the branch committee without approval of the branch members or branch committee. Regarding profit/loss, it is mentioned that the profit and loss of the branches will be pertaining to the branch only i.e. any profit of the branch should distributed among the branch members only. The petitioner organisation has about 500 to 600 members in the society. According to the petitioner, these members assemble in the office of the petitioner each morning at 4.00 a.m. and collect dough (Goal) of Papad of 3 Kg. and deposit the rolled Papads Prepared from of the dough (Gola) taken from the office on the preceding day. The members take the goal their home, roll the Papads and deposit the same and for the work done, they are paid Rs. 2/- per kg. for making Papad. According to the petitioner, there they have no supervision or control over the members nor any relations of master and servant can be said to be existing.
10. In this background, the evidence of the parties maybe looked into. According to Fulabai Madhukarrao Share, one of the respondents, she had been working with the petitioner since 1972 and there were about 500 to 600 female labourers engaged by the petitioners on the piece- rate basis which was initially Rs. 2/- per kg for the finished papads. The respondents used to visit the petitioner Centre at 4.00 a.m. daily and they were required to stand in queue for effecting delivery of Papad prepared by them on the earlier day. After handing over the finished Papads, the respondents had to take the material duly prepared for rolling papads and the said material would be handed over to them after weighing the same. The Papads were to be rolled at the respondents’ respective homes and on average, each respondent used to roll 3 kg. of Papad daily. According to her, in case the Papads were not prepared to the satisfaction of the petitioners, the same used to be returned to them and for which deductions were effected from their wages. She deposed that the respondents agitated for increasing wages and also demand for bonus and some of them resorted to hunger strike for pressing their demands which annoyed the petitioners. She also testified that for the work done, the respondents used to be paid wages every day initially, but subsequently, the wages used to be paid fortnightly. In cross-examination, this witness deposed that only those persons who were enrolled with the petitioner, used that the raw-material for rolling the Papads after their house-hold work was complete. She also admitted in the cross-examination that it was not necessary that each of the rolled women was required to roll Papads daily. She stated in her deposition that each of such women was not required to roll Papads. She admitted that each of the workers had to sign on a form and the declaration form shown to there, was the same which she signed. She expressed her lack of knowledge as to whether on submission of declaration form, the workers were accepted as members of the Society. She also did not know whether the rates of Papads used to be decided in general meeting and whether the wages were fixed in the meeting held on 11.8.1982. She also deposed in cross-examination that there was no supervision at their houses when they rolled Papads and at their houses, about her she, deposed that she only rolled the Papads at her house and nobody else. She also admitted that there was no agreement regarding any pay between them. In other witness Ratnakala Kokane who is also one of the respondents, deposed that she has been working with the petitioner and was rolling Papads by taking the material at the house. She used to go to the Centre everyday at 4.00 a.m. to return the Papads rolled earlier day and take the dough. According to her, the petitioner used to return the Papads which were not upto the mark and for that damage, the petitioner used to deduct the amount from the amount payable to the respondents. According to her, on average, she used to roll 3 kg. of Gola and for that, she was paid @ Rs. 2/- per Kg. She denied that she was a member of the Society and that she was never informed about the profit and loss by the petitioner. According to her, at Amravati Centre, Induati Deshmukh was Sanchalika (Manager) and she was getting Rs. 1000/- per month. This witness also deposed that there was packing section and that each pack contains 250 gms. of Papads and some of the ladies were required to do only packing work. She also deposed that when they demanded increase in wages and payment of bonus. Their services were terminated. In cross-examination, she reiterated that she was not the member and when she came for the first time for work, the petitioner got her signature/thumb impression on a form and she signed that form since show wanted to work and she did not read the form and the contents. She denied the suggestion that only after reading the form, she signed. She admitted in cross-examination that only those ladies who signed the form, would get Gola to roll the Papads and they would roll the Papads at their residence. There was no compulsion that ever day they were required to go to the Centre to take Goal and roll the papads and if they did not go for 7-8 days, their work was stopped. According to her there was no supervision as such by party no. 1 while performing the work at there homes. She denied that she was not the employee of petitioner. She admitted that there was no written agreement regarding pay by the petitioner. Thus, these two witnesses produced on behalf of the respondents have given details about the activities of the petitioner, the nature of work done by them, the supervision of the petitioner over the finished Papads handed over by the respondents to the petitioner, and their relationship with the petitioner.
11. On the other hand, the petitioner examined Smt. Indumati Jagdish Deshmukh, their Sanchalika (Manager) in support of their stand. She deposed that she was Sanchalika for Mahila Griha Udyog Lijjat Papad Kendra, Amravati. In the morning, she would distribute the dough for rolling the Papads to the members who were only female members. According to her, the respondents were not their employee, but they were all members of the petitioner and when they wanted to become member of the Society, they would fill up the form and the affidavit. Each member would roll the Papads at their respective housed either personally or through their family members and the petitioner was not aware as to who actually rolled the Papads. She also deposed that there was no supervision at their houses and the members used to decide the labour charges payable to them per kilogram. The capital was provided by the Head Office at Bombay and every month, balance sheet was prepared and profit was distributed to all members. On 11.8.1982 a meeting of members was held and the said meeting was convened to decide about the salary and wages of the members for rolling the Papads. According to her, it was not compulsory that every member should roll the Papads and before she became Sanchalika, she used to roll the Papads. She denied that they relation with the members was that of master and servant and asserted that each member has the capacity as owner of the Institution and not servant. She deposed that their Institute was exempted from income-tax and sales tax and that a case under the Bonus Act was filed against her wherein she was acquitted. In her cross-examination, this witness testified that the Head Office of the Mahila Griha Udyog Lijjat Papad is at Bombay and it is a registered Public Trust. She admitted that members of Amravati Branch do not participate in the election of the Head Office. She also admitted that some raw-material is supplied by the Head Office and some is purchased at Amravati and in all there are 31 branches excluding Bombay, in India. She deposed that Bombay Office has no control over each Branch. She also deposed that Amravati Branch is not registered under the Bombay Public Trusts Act and admitted that Amravati Centre is registered under the Bombay Shops Act Establishments Act and about 500-600 women work at Amravati Centre. According to her, at 5.00 a.m. women assemble it collect Gola and they deposit Papads rolled on every day. Weight of Papads rolled by every woman is recorded and Papads are sorted and damaged or such Papads not in accordance with the specification, are returned. She also admitted in cross-examination that as per the weight of the damaged Papads, the amount is deducted from the wages. She deposed that attendance of the women workers who come daily, is not recorded. However, there, is record in respect of women to whom work is given and the wages are given as per the work done by each woman. She also admitted that women made agitation for increase of the charges for rolling the Papads. She also admitted that nine women labourers filed cases in the Labour Court for minimum wages and the ex-parte order was passed and the arrears were paid. She denied that services of the respondents have been terminated, but admitted that the membership has been cancelled.
12. On shifting of the aforesaid evidenced by the parties, certain facts can be said to be well established. The Head office of the Mahila Griha Udyog Lijjat is at Bombay and is registered under the Bombay Public Trusts Act. The petitioner is Amravati Branch of the said Mahila Griha Udyog Lijjat Papad.
The raw material is partly supplied by the head Office and partly purchased at Amravati, necessary for preparation of Papads. The petitioner Shri Mahila Griha Udyog Lijjat Papad is registered under the Bombay Shops and Establishments Act. About 500 to 600 women are working at the petitioner Centre. Early in the morning, the women assemble to collect the Gola and they deposit the Papads rolled on earlier date. The weight of Papads prepared by each woman is recorded; Papads are sorted out and such Papads which are damaged and not prepared according to specifications, are returned. For the damaged Papads, according to their weight, the amount is deducted from the amount payable to such women who had rolled the Papads. The payment is made according to the work done i.e. workers are paid at a particular rate for per kilogram of Papad rolled. The papads are rolled at the respective houses of the workers. The workers are women who roll the Papads and they are required to sign declaration and affirm the affidavit.
13. In view of the aforesaid established acts, the first question which needs to be decided is as to whether the petitioner Shri Mahila Griha Udyog Lijjat Papad at Amravati is an “Industry” within the meaning of Section 2(j) of the Industrial Dispute Act or not, Mr. S. G. Aney, the learned Senior Counsel appearing on behalf of the petitioner, submits that the petitioner, cannot be termed as “industry” within the meaning of Section 2(j) of the Industrial Disputes Act because there existed to relationship of employer and employees between the petitioner and the respondents and only to that extent. He would urged that the petitioner cannot be said to be an industry under Section 2(j) of the Industrial Disputes Act. In this connection. Mr. Anew placed his strong reliance on the observations made by the Apex Court in para 11 of the Management of M/s. Sufdarjung T. B. Hospital v. The Workmen of the said report reads as under :-
“These observations need to be some what qualified. It is to be noticed that the definition modifies somewhat the definition of “industry” in Section 4 of the Commonwealth Conciliation and Arbitration Act (1909-1910) (Acts Nos. 13 of 1904 and 7 of 1910) of Australia where the definition reads.
“industry” means business trade manufacture undertaking calling, service or employment on land or water in which persons are employed for pay, hire, advantage or reward, excepting only persons engaged in agricultural, viticultural, horticultural or dairying pursuits”.
Although the two definitions are worded differently the purport of both is the same. It is not necessary to view our definition in two parts. The definition read as a whole denotes a collective enterprise in which employers and employees are associate. It does not exist either by employers alone, or by employees alone. It exists only when there is a relationship between employers and employees the for mere engaged in business, trade, undertaking, manufacture or calling of employers and the latter engaged in any calling, service, employment, handicraft or industrial occupation or avocation. There must, therefore, be an enterprise in which the employers follow their avocations as detailed in the definition and employ workmen who follow one of the avocations detailed for workmen. The definition no doubt seeks to define “industry” with reference to employers occupation but includes the employees, for without the includes the employees, for without the two there can be no industry. An industry is only to be found when there are employers and employees, the former relying upon the services of the latter to fulfill their own occupations.”
14. Section 2(j) of the Industrial Disputes Act has come for consideration before the courts time and again and its amplitude, scope and application has comprehensively been laid down by the Apex Court in Bangalore Water Supply & Sewerage Board v. A. Rajappa & Ors. . The expression “industry’ in section 2(j) of the Industrial Disputes Act, therefore, requires much debate on the face of the tests laid down in the Bangalore Water Supply and Severage Board’s case (cited supra). After survey of entire case law on the subject, the Supreme Court in the said case summarised the term “industry” as defined in Section 2(j) of the Industrial Disputes Act, as follows :-
‘Industry’, as define din S. 2(j) and explained in Banerji has a wide import, (a) Where (i) systematic activity, (ii) organised by co-operation between employer and employee (the direct and substantial element is chimerical) (iii) for the production and/or distribution of the production and/or distribution of goods and services calculated to satisfy human wants and wished (not spiritual or religious but inclusive of material things or services geared to celestialbliss i.e. making, on a large scale prasad or food) prima facie, there is an industry in that enterprise.
(b) Absence of profit motive or gainful objective is irrelevant, be the venture in the public joint, private or other sector.
(c) The true focus is functional and the decisive test is the nature of the activity with special emphasis on the employer-employee relations.
(d) If the organisation is a trade or business it does not cease to be one because of philanthorophy animating the undertaking.
II. Although Section 2(j) uses words of the widest amplitude in its two limbs, their meaning cannot be magnified to overreach itself.
(a) ‘Undertaking’ must suffer a contextual and associational shrinkage as explained in Banerji and in this judgment; so also, service, calling and the like. This yields the inference that all organised activity possessing the triple elements in I (supra), although not trade or business. May still be “industry” provided the nature of the activity, viz. the employer-employee basis, bears resemblance to what we find in trade or business. This takes into fold ‘industry’, undertaking, calling and services, adventures analogous to the carrying on of trade or business.’ All features, other than the methodology of carrying on the activity viz. in organising the co- operation between employer and employee, may be dissimilar. It does not matter, if on the employment terms there is analogy.
III. Application of these guidelines should not stop short of their logical reach by invocation of creeds, cults or inner sense of incongruity or outer sense of motivation, for or resultant of the economic operations. The ideology of the Act being industrial peace, regulation and resolution of industrial disputes between employer and workmen, the range of this statutory ideology must inform the reach of the statutory definition. Nothing less, nothing more.
(a) The consequences are (i) professions, (ii) Clubs (iii) educational institutions (iv) co-operatives, (v) research institutes, (vi) charitable projects and (vii) other kindred adventures, if they fulfill the triple tests listed in I (supra), cannot be exempted from the scope of Section 2(j).
(b) a restricted category of professions, clubs, co-operatives and even gurukulas and little research labs, may qualify for exemption if, in simple ventures, substantially and, going by the dominant nature criterion, substantively, no employees are entertained but in minimal matters, marginal employees are hired without destroying the non- employee character of the unit.
(c) If, in a pious or altrustic mission many employee themselves, free or for small honoraria, or like return, mainly drawn by sharing in the purpose or cause, such as lawyers volunteering to run a free legal services clinic or doctors serving in their spare hours in a free medical centre or ashramites working at the bidding of the holiness, divinity or like central personality, and the services are supplied free or at nominal cost and those who service are not entaged for remuneration or on the basis of master and servant relationship, then, the institution is not an industry even if stray servants, manual or technical are hired. Such eleemosynary or like undertakings alone are exempt – not other generosity, compassion, developmental passion or project.
IV. The dominant nature test :
(a) Where a complex of activities, some of which qualify of exemption, others not involves employees on the total undertaken, some of whom are not ‘workmen’ as in the University of Delhi case or some departments are not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the departments as explained in the Corporation of Nagpur will be true test. The whole undertaking will be ‘industry’ although those who are not ‘workmen’ by definition may not benefit by the status.
(b) Notwithstanding the previous clauses, sovereign functions strictly understood, (alone) qualify for exemption, not the welfare activities or economic adventures undertaken by government or statutory bodies.
(c) Even in departments discharging sovereign functions, if there are units which are industries and they are substantially severable, then they can be considered to come within S. 2(j).
(d) Constitutional and competently enacted legislative provisions may well remove for the scope of the Act categories which other wise may be covered thereby.
V. We overrule Safdarjung , Solicitors’ case , Gymkhana , Delhi University , Dhanrajgirji Hospital and other rulings whose ratio runs counter to the principles enunciated above, the Hospital Mazdoor Sabha is hereby rehabilitated.”
Applying the aforesaid tests on the facts found, it is eminently established that the petitioner is engaged in systematic activity or by co-operative between the petitioner and the women worker though coined as members, for the production of Papads and the said production is made on the large-scale basis. The enterprise of the petitioner is the venture in private sector. The organization of the petitioner is definitely an organisation carrying on trade or business and merely because it has noble objectives and developmental projects of women, there is no reason not to implicate the petitioner organisation as an “industry”. The purchase marketing preparation of the Papads and others functions being carried on by the petitioner are like any trade or business and looking to the activities being carried or by the petitioner, there cannot be any hesitation in holding that the petitioner society is an “industry”. The motive and project of the petitioner society viz to encourage and help the needy women might have its origin based on the philosophy of Sarvodaya, the activity of Papad making is definitely an activity of trade and business and has all the trappings of trade and business and it does not cease to be an industry nor is excluded, from the definition of “industry” under Section 2(j) because of its laundable objectives and the tests laid down by the Apex Court in Bangalore Water Supply case (Cited supra) do characterised the petitioner an “industry” under Section 2(j) of the Industrial Dispute Act. Merely because the women workers engaged in preparation of papads are styled as members by the petitioner, that would not exclude relationship of employer and employee in view of facts found above. The nomenclature as style of calling the women workers as members is intended to ex-facie exclude the applicability of labour laws but on lifting the veil to find the true nature of relationship, the fact established clearly show that they are employees of the petitioner Society. The employee would not cease to be an employee even if she or he has been given any other name. The fact that for the services rendered by the respondents-workers, they were paid wages by whatever name called and their product as under Supervision and control of the petitioner, would lead to an irresistible conclusion that there was relationship of employer and employee between the petitioners and the respondents. The nature of activity carried on by the petitioner, viz preparation of Papads, if looked into in the background of the facts that every morning the respondents would come to the centre, collect the Gola and deposit the Papads rolled on earlier day, weighment of Papads prepared by each woman, sorting out and screening of the Papads have been prepared in accordance with the specifications or not and if damages, and found not prepared in accordance with the specifications, these were returned and the amount was deducted from the wages of the respondents on the basis of the weight of the damaged Papads would definitely show that there was relationship of employer and employee and merely because the respondents were styled as member no other relationship can be inferred between the parties except that the petitioner was employers and the respondent were employees. Even the declaration on oath obtained by the petitioner in form of affidavit from the respondents, would show that in the garb of styling them as members by its dominant position the petitioner was seeking to exploit the workers so that these workers may not agitate about their lawful right. In para 1 of the affidavit, it is declared that remuneration of the work would be accepted by them gladly. Every respondent was to abide by the declaration that she would not produce papad herself or any other member of the family at home of the organisation other than the petitioner. It is further declared in para 9 that every respondent would prepared at least 3 kg Papad daily. All these stipulations on close scrutiny make it clear that dispute the fact that the respondents were styled as members of the petitioner Society, they were, in fact, employees and looking to the nature of the activity being carried on by the petitioner, the relationship of employer and employee existed between the petitioner and the respondents. The relationship has to be truly spelt out in the light of the nature of the activity of trade or business, even if all features in organising the co-operation between employer and the employee may not be similar, yet on the basis of facts found it can safely be said that there is relationship of employer and employee between the parties. Thus, the inescapable conclusion that the petitioner organisation fulfills the triple tests laid down in the Bangalore Water Supply & Sewearage Board’s case (supra) and does not fall in any exclusion category laid down by the Apex Court and the petitioner is covered by expression ‘industry’ under Section 2(j) of the Industrial Disputes Act. It may be noted here that the Safdarjung’s case (cited supra) has been overruled by the Supreme Court in Bangalore Water Supply and Sewerage Board’s case (supra).
15. The Labour Court while examining this question as to whether the petitioner is an “industry” or not, has observed as under :-
…. From the evidence on record which I have discussed above, it becomes clear that there is systematic activity of party and the activities are organised by co-operation and there is distribution of goods and services which are rendered to satisfy the human wants and wishes. Relying on ruling reported in AIR 1978 S. C. page 213 Bangalore Water Supply & Sewerage Board v. A. Rajappa. I hold that party No. 1 is an industry. It deserves to be noted that party No. 1 has filed writ petitioner No. 381/81 against 9 women of the Amravati Centre and the Presiding Officer, Labour Court, Akola. It was a case under Sec. 33-C(2) of the I. D. Act. Hon’ble Justice Dhabe in para 2 of the Judgment had observed that it is clear that the impugned order that activity carried on by the petitioner is squarely covered by the definition of the word ‘industry’ given in Sec. 2(j) of the Act because it satisfy preliminary test of being carried out with the co- operation of the petitioner and its employees. As already held in several decision whether particular activity is an industry or not. The findings of the labour court on the above question therefore deceives to be upheld. In view of the above decision recorded by the Bombay High Court and in view of the evidence discussed above. I hold that party No. 1 is an industry.”
16. In view of my aforesaid discussion in the light of the test laid down by the Apex Court, the amplitude, scope and wider import of the term “industry” in Section 2(j) of the Industrial Disputes Act and the facts established on record, the activity being carried by the petitioner in preparation of Papads. The said activity being systematically organised by co-operation between the petitioner and the respondents who are, in fact, employer and employees, though the respondents have been styled as members and the production of Papad by the petitioner which are prepared by the respondents and the said services are provided by the respondents calculated to satisfy the human wants and wishes and the said papads prepared and produced on a large-scale basis and the fact that the activity of preparation and production of Papad is an activity of trade and business by the petitioner through intended to encourage the employment in the women. with noble objectives and developmental projects, the petitioner organisation is definitely as “industry” and has been rightly held to be so by the Labour Court and the said finding does not call for any interference by this Court.
17. Another argument raised by Mr. S. G. Aney learned counsel appearing on behalf of the petitioner is that all the respondents are the members of the petitioner Society and, therefore, are not workmen within the meaning of Sections 2(s) of the Industrial Disputes Act. In the connection, the learned senior counsel referred to the Articles of Association of Shri Mahila Griha Udyog Lijjat Papad having its registered office at Bombay. Articles 1 and 2 which deal with the membership, read as under.
“1-A membership :
The following qualifications are necessary to become a member :
(a) Any woman who can render physical work in the industry recognised by the Khadi Village Industries Commission, without distinction of caste, colour or creed.
(b) The woman whose age is not less than 15 years.
(c) Who abides by the objectives of the Mandal, and,
(d) Who has signed on oath the prescribed application form for admission will be entitled to be a member at any time during the year.
1-B. Over and above what is indicated in A., any woman who starts working in the Institution becomes its members from the date on which she starts working.
2. Cancellation of Membership :
The membership shall be cancelled in the following circumstances :
(a) By death.
(b) Who has resigned and the Managing Committee has accepted the same.
(c) The Managing Committee shall dismiss such a member immediately whose behaving is against the objectives of the Mandal, and constitution and the bye-laws, and whose activities are harmful to the Mandal, and by the ordinary majority and decision of the Mandal, the Membership shall be cancelled.
(d) Who is not of sound mind.
(e) One who is a members of competitive Mandal or acts against the objectives of the Mandal or manufacture papad or papad of the type of our Mandal for individual person or others shall be immediately dismissed by the Managing Committee on passing the resolution by majority of the Managing Committee.
(f) Any member who stops working for Institution will automatically forfeit her membership.”
18. The learned counsel for the petitioner also referred to the affidavit which every member was required to sign and the relevant clauses on which Mr. Aney placed reliance, are :-
“1. I will take every work of the organisation as the work of God and whatever I will get as remuneration (Prasad), I will accept it gladly.”
“3. Myself or any other individual of my home will not produce PAPAD (a thing crisp cake, Indian) other than the organisation”.
“6. I will be able to sanction leave to the individuals in the business either salaried or non-salaried.”
“7. Once the labour and the increased labour is decided, until the full distribution is done, the decided distribution system would be agreeable to me.”
“8. I will try to inculcate the meaning of co-operative ownership. I will not count the Vanai (labour portion) remuneration, as we do not count the cakes in anybody’s thali when eating together, likewise, I will not measure the remuneration. But at the same time I will see that my co-workers do not get less remuneration”.
“9. I will prepare at least (minimum) 3 kg. Papad daily”.
It was, thus argued by the learned counsel for the petitioner that the respondents are not the “workmen” and all these respondents work in the capacity as owners and members of the petitioner Society and they run the Institution. Mr. Aney submitted that the petitioner Society belongs to the members and there is no compulsion or supervision of any kind on the working of the members are not subordinate to anybody. In support of his contention and to demonstrate that the respondents are not the “workmen”, the learned counsel for the petitioner relied on Shanker Vaze v. State of Mah. , Workmen of Food Corpn. v. Food Corpn, and M. G. Bidi Workers v. Union of India . My Aney also contended that the Labour Court has wrongly applied the principles for holding the respondents as workmen by relying on the provisions of Bombay Shops and Establishments Act and this resulted in erroneous finding and in this connection, the learned senior counsel relied on M/s. MSCO Pvt. Ltd. union of India & Ors. Section 2(s) of the Industrial Dispute Act, 1947 reads as under :-
“2(s) “Workman” means any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether, the terms of employment by express or implied, and for the purpose of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person –
(i) who is subject to the Air Force Act 1950 or the Navy Act, 1957; or
(ii) who is employed in the Police service or as an officer or other employee of a person, or
(ii) who is employed mainly in managerial or administrative capacity, or
(iv) who, being employed in a supervisory capacity draws wages exceeding one thousand six hundred rupees per monism or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of managerial nature”.
19. In Dharangadhra Chemical Works Ltd. v. State of Saurashtra & Ors. , the Apex Court after considering the definition of “Workman” in Section 2(s) of the Industrial Disputes Act held as under”.
“…. The essential condition of a person being a workman within the terms of this definition is that he should be employed to do the work in that industry, that there should be in other words, an employment of his by the employer and that there should be the relationship between the employer and him as between the employer and employee or master and servant. Unless a person is thus employed, there can be no question of his being a workman within the definition of the term as contained in the Act.”
“(14) The principle which emerges from these authorities is that the prima face test for the determination of the relationship between master and servant is the existence of the right in the master to supervise and control the work done by the servant not only in the matter of directing what work the servant is to do but also the manner in which he shall do his work, or to borrow the words of Lord Uthwatt at page 23 in Mersey Dock and Harbour Board v. Coggins & Giffith (Liverpool) Ltd. 1947 I AC 1 at p. 23 (E). The proper test is whether or not the hirer had authority to control the manner of execution of the act in question.
“(15) The nature or extent of control which is requisite to establish the relationship of employer and employee must necessarily vary from business to business and is by its very nature capable of precise definition. As has been noted above, recently pronouncement of the Court of Appeal in England have even expressed the view that it is not necessary for holding that a person is an employee, that the employer should be proved to have exercised control over his work, that the test of control was not one of universal application and that there were many contorts in which master could not control the manner in which the work was done (Vide observations of Somervelle, L. J. in Cassidy v. Ministry of Health (supra) and Denning L. J. in Stevenson, Jordan and Harrsison Ltd. v. Macdonald & Evans (B) (Supra).”
“(16). The correct method of approach, therefore, would be to consider whether having regard to the nature of the work there was due control and supervision by the employer or to use the words of Fletcher Moulton, L. J. at page 549 in Simmons v. Health laundry Co. 1910-1 KB 548 at PP. 549, 550. (F) : In my opinion it is impossible to lay down any rule of law distinguishing the one from the other. It is question of fact to be decided by all the circumstances of the case. the greater the amount of direct control exercised over the person rendering the services by the person contracting for them the stronger the grounds for holding it to be a contract of service, and similarly the greater the degree of independence of such control the greater the probability that the services rendered are of the nature of professional services and that the contract is not one of service”.
“(25) Learned counsel for the appellants laid particular stress on two features in this cause which in his submission were consistent only with the position that the agarias are independent contractors. One is that they do piece-work and the other that they employer their own labour and pay for it. In our opinion neither of these two circumstances if decisive of the question. As regards the first, the argument of the appellants is that as the agarias are under no obligation to work for fixed hours of days and are to be paid wages not per day or hours but for the quantity of salt actually produced and passed at a certain rate, the very basis on which the relationship of employer and employees rests is lacking and that they can only be regarded as independent contractors. There is, however, abundant authority in England that a person can be a workman even though he is paid not per day but by the hob. The following observations of Crompton, J in Sadler v. Henlack 1855 (4) El & B 1570 at p. 578 : 119 : ER 209 at p. 212 (I) are pertinent in this behalf.
The workman must have consented to give his personal services and not merely to get the work done, but if he is bound under his contract to work personally, he is not excluded from the definition, simply because he has assistance from others, who work under him………..”.
“(28). There are no doubt considerable difficulties that may arise if the agarias were held to be workmen within the meaning of S. 2(s) of the Act. Rules regarding hour of work etc. applicable to other workmen may not be conveniently applied to them and the nature as well as the manner and method of their work would be such as cannot be regulated by any directions given by the Industrial Tribunal. These difficulties, however, are not deterrent against holding the agarias to be workmen within the meaning of the definition if they fulfil its requirements. The Industrial Tribunal would have to very well consider heat relief, if any may possibly be granted to them having regard to all the circumstances of the case and may not be able to regulate the work to be done by the agarias and the remuneration to be paid to them by the employer in the manner it is used to do in the case of other industries where the conditions of employment and the work to be done by the employees is of a different character. These considerations would necessarily have to be borne in mind while the Industrial Tribunal is adjudicating upon the dispute which have been referred to it for adjudication. They do not, however, militate against the conclusion which we have come to above that the decision of the Industrial Tribunal to the effect that agarias are workmen within the definition of the term contained in S. 2(s) of the Act was justified on the materials on the record”.
20. The Supreme Court in Shankar Waje’s case (supra) a case strongly relied upon by the learned counsel for petitioner has held as under :-
“15. Further, the facts of the case indicate that the appellant had no control and supervision over the details of Pandurang’s work. He could not control his hours of work. He could not control his days of work. Pandurang was free to absent himself and was free to go to factory at any time and leave it at any time according to his will. The appellant could not on any particular minimum quantity of bidis to be turned out per day. He could not control the time spent by Pandurang on the rolling of bidi or a number of bidis. The work of rolling bidis may be a simple work and may require no particular supervision and direction during the process of manufacture. But there is nothing on record to show that any such direction could be given.”
“16. In this connection, reference may again be made to the observation at p. 1349 (of SCR) in Chintaman Rao’s case, . The Court was considering whether the Sattedars were workers or were independent contractors. The Sattedars used to receive tobacco from the management and supply them rolled bidis. They could manufacture bidis outside the factory and could also employ other labour. It was, on these facts, that it was said “The management cannot regulate the manner of discharge of his work”. In the present case too, Pandurang used to be supplied tobacco. He could turn out as many bidis as he liked and could deliver them to the factory when he wanted to cease working. During his period of work, the management could not regulate the manner in which he discharged his work. He could take his own time and could roll in as many bids as he liked. His liability under the daily agreement was discharged by his delivering the bidis prepared and the tobacco remaining with him unused. The appellant could only order or require Pandurang to roll the bidis, using the tobacco and leaves supplied to him, but could not order him as to how it was to be done. We are, therefore, of opinion that the mere fact that the person rolling bidis has to roll them in a particular manner can hardly be said to give rise to such a right in the management as can be said to be a right to control the manner of work. Every worker will have to turn out the work in accordance with the specifications. The control of the management, which is a necessary element of the relationship of master and servant is not directed towards providing or dictating the nature of the article to be produced or the work to be done, but refers to the other incidents having a bearing on the process of work the person carries out in the execution of the work. The manner of work is to be distinguished from the type of work to be performed. In the present case the management simply says that the labourer is to produce bidis rolled in a certain form. How the labourer carries out the work is his own concern, and is not controlled by the management, which is concerned only with getting bidis rolled in a particular style with certain contents.”
“(17). Further, this Court in Chintaman Rao’s case , examined the various provisions of the Act at pp. 1350-51 (of SCR : at p. 393) of AIR and then said at p. 1351 (of SCR) : at p. 393 of AIR :
“The scheme of the aforesaid provisions indicates that the workmen in the factory are under the direct supervision and control of the management. The conditions of service are statutorily regulated and the management is to conform to the rules laid down at the risk of being penalised for dereliction of any of the statutory duties. The management obviously cannot fix the working hours, weekly holidays, arrange for night shifts and comply with other statutory requirements, if the persons like the Sattedars, working in their factories and getting their work done by others or through collies, are workers within the meaning of the Act. It is well nigh impossible for the management of the factory to regulate their work or to comply with the mandatory provisions of the Act. The said provisions, therefore, give a clear indication that a worker under the definition of the Act is a person who enters into a contract of service under the management and does not include an independent contractor or his collies or servants who are not under the control and supervision of the employer”.
It can be said, in the present case too, that the appellant could not fix the working hours or weekly holidays or make arrangements for night shifts and comply with other statutory requirements, if Pandurang be held to be a worker within the meaning of the Act. We are, therefore, of opinion that Pandurang was not a worker.”
“(18). It is true as contended for the State that persons engaged to roll bidis on job work basis could be workers, but only such persons would be workers who work regularly at the factory and are paid for the work turned out during their regular employment on the basis of the work done. Piece-rate workers can be workers within the definition of “worker” in the Act, but they must be regular workers and not workers who come and work according to their sweet will. It is also true as urged for the State, that a worker, within the definition of the expression in the Act, need not be a whole-time worker. But, even then, the worker must have, under his contract of service, an obligation to work either for a fixed period or between fixed hours. The whole conception of service does not fit in well with a servant who has full liberty to attend to his work according to his pleasure and not according to the orders of his masters.”
21. In Workmen, Food Corporation of India’s case (supra), the Apex Court held thus :-
“11. Briefly stated, when Corporation engaged a contractor for handling foodgrains at Siliguri Depot, the Corporation had nothing to do with the manner of handling work done by the contractor, the labour force employed by him, payments made by him etc. In such a fact situation, there was no privity of contract of employer and workmen between the Corporation and the workmen. ‘Workmen’ has been defined….. Industrial Disputes Act to mean ‘any person (including an apprentice employed in any industry to do…..” The expression ’employed’ has at least two known connotations but as used in the definition, the context would indicate that it is used in the sense of relationship brought about by express or implied contract or service in which the employee renders service for which he is engaged by the employer and the latter agrees to pay him in cash or kind as agreed between them or stautorily prescribed. It discloses a relationship of command and obedience. The essential condition of a person being a workman within the terms of the definition is that he should be employed to do the work in that industry and that there should be, in other words, an employment of his by the employer and that there should be a relationship between the employer and him as between employer and employee or master and servant. Unless a person is thus employed there can be no question of his being a ‘workman’ with in the definition of the term as contained in the Act Dharangdhara Chemicals Works Ltd. v. State of Saurashtra . Now where a contractor employs a workman to do the work which he contracted with a third person to accomplish on the definition as it stands, the workman of the contractor would not without something more become the workman of that third person. Therefore, when the contract system was in vogue, the workmen employed by the contractor were certainly not the workmen of the Corporation and no claim to that effect has been made by the Union.”
22. While examining the question as to whether the petitioner is an “industry” or not, I have already held about that looking to the nature of the activities being carried on by the petitioner, the supervision and control of the petitioner about the quality and weight of papads prepared by the respondents, power of the petitioner to deduct the amount on finding that the Papads prepared by the respondents were damaged or were not in accordance with the specifications and the payment of charges made on the basis of per kilogram of Papads rolled by the respondents, there was relationship of employer and employee between the petitioner and the respondents and for the self-same facts, it is obvious that in view of the tests laid down by the Apex Court in Dharangadhara Chemical Workers (cited supra) the respondents were workmen within the meaning of Section 2(s) of the Industrial Disputes Act.
23. All angles and facets touching expression work, an S. 2(s) have been dealt with by the Apex Court in Dharangadhara Chemical Works Ltd.’s case (supra) and Their Lordships held that the prima facie test which is applied to determine the relationship of employer or employee or master and servant is existence of right of control in respect of the manner in which the work is to be done. Their Lordships (sic) contract for service was one where the master ordered what was to be done while contract of service was one where the master not only ordered what was to be done, but how it was to be done.
Their Lordships observed that the nature or extent of control which is requisite to establish the relationship of employer and employee must necessarily vary from business to business and is by its very nature, incapable of precise definition. According to Their Lordships, what is required to be seen is, whether having regard to the nature of work, there was due control and supervision or not. The Apex Court held that the fact that the persons who were engaged were paid on piece-rate basis and that they could employ their own labour and pay for it, could not be considered to be a deciding factor to hold them as independent contractors when employer had power of supervision and control at all stages of work. Their Lordships also held that a person could be workman even though he was not paid per day, but by the job and not actual control and supervision, but a right to control and supervise there of was necessary. Their Lordships held that if a person works personally and also took outside assistance, he still continues to be a “workmen”.
24. In the case of Shankar Waje (cited supra), the Apex Court was considering, whether bidi roller was worker with in the meaning of Section 2(i) of the Factories Act, 1948. One of the essential ingredients which should exist to make a person fall within the definition of ‘worker’ under Section 2(i) of the Factories Act is that he be employed in one of the processes mentioned in that clause and in the case before the Apex Court Shankar’s case, there was a no dispute that the work which the concerned person did came within one of such processes, but the question was, whether he could be said to be employed by Balaji and in that background, the majority of the Judges held that the appellant was wrongly convicted. The definition of ‘workman’ in Section 2(s) of the Industrial Disputes Act noted above is entirely different and that meant any person employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward irrespective of the terms of employment whether express or implied. The work done by the respondents in preparing Papads is definitely covered in the said definition and the said work is done by them on payment of wages fixed at per kilogram of Papads and the petitioner has right of control and supervision over the quality of Papads prepared by the respondents. Merely because the Papads were prepared by the respondents at their respective houses, it did not mean that the petitioner had no right of control or supervision. The fact that Papads prepared by the respondents are sorted out and those damaged and found not in accordance with the specifications are returned and the amount for such returned papads would be deducted from the wages payable to the respondents, clearly show the right of control and supervision of the petitioner over the respondents. It is irrelevant, even it be assured that the respondents were availing services of the other members of the family in preparation of Papads.
25. In Dharangadhara Chemical Works Limited’s case (supra) the Supreme Court has upheld that there was abundent authority that a person can be workman even though he was paid not per day, but by the job. The respondents were initially paid every day for the job done, but later on they used to be paid every fortnightly for the job done on the basis of the Papads prepared by them. The evidence which has come on record and the facts which have been found to be established are, about 500 to 600 women are working at the petitioner centre. Early in the morning the women assemble to collect the Gola and they deposit the Papads rolled on earlier day. The weight of Papads prepared by each woman is recorded. The Papads are sorted out and such Papads which are damaged and not prepared according to the specifications are returned. For the damaged Papads, according to their weight, the amount is deducted from the amount payable to the women who had rolled the Papads. The payment is made according to the work done i.e. the workers are paid at a particular rate for per kilogram of Papad rolled. From this facts and applying the principles laid down by the Apex Court in Dharangadhara Chemical Works Ltd.’s case (supra), it can safely be concluded that all the respondents though styled as members are workmen within the meaning of Section 2(s) of the Industrial Disputes Act and have been rightly held to be so by the Labour Court. Amravati.
26. It is true that while considering the question as to whether the respondents are the “workmen” or not, the Labour Court has referred to the provisions of the Bombay Shops and Establishments Act, but in my view, it cannot be said that the ultimate conclusion drawn by the Labour Court that the respondents were “workmen”, was erroneous. There cannot be any dispute about the proposition that to find out whether the respondents are workmen or not, the expression “workman” appearing the Section 2(s) of the Industrial Disputes Act has to be considered and the said expression cannot be depended upon the expression “workman” occurring in other Acts and even if the provisions of the Bombay Shops and Establishments Act are not looked into, in view of the facts which have been found by the Labour Court, it cannot be said that final conclusion drawn by the Labour Court that the respondents were “workmen” suffered from any infirmity. As observed by me above, from the established facts, the inescapable conclusion is that the respondents are workmen within the meaning of Section 2(s) of the Industrial Disputes Act. 1947.
27. No there point has been argued.
28. Upshot of the aforesaid discussion is that this batch of eleven writ petitions is devoid of any merit and all these writ petitions are dismissed. Since the respondents were not represented by the counsel during the course of arguments, the parties are directed to bear their own costs. Rule is discharged in all the cases.