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2023 Supreme(Cal) 1070

IN THE HIGH COURT AT CALCUTTA
RAJA BASU CHOWDHURY, J.
Food Corporation of India - Petitioner
Versus
Union of India & Ors. - Respondents
WPA Nos. 19121, 19124, 19126, 19135, 19139, 19140, 19144, 19146, 19149, 19150 of 2022
Decided On : 03-07-2023

Advocates Appeared:
For the Petitioner: Mr. Kamal Kumar Chattopadhyay.
For the Union of India : Ms. Avipsa Sarkar.
For the Workers : Mr. Samiran Mondal, Mr. Abhinaba Dan, Mr. Nitish Samanta.

Workers who are employed for wages in an establishment and have a master-servant relationship with the employer are entitled to gratuity under the Payment of Gratuity Act, 1972, regardless of whether they were appointed in terms of the establishment's regulations.

Headnote:

GRATUITY ACT - EMPLOYEES - SECTION 2(E) - PAYMENT OF GRATUITY ACT, 1972 - The court held that the workers, who were initially appointed as contract labourers under the handling contractor, but later received wages directly from the petitioner, qualified as employees within the meaning of Section 2(e) of the Payment of Gratuity Act, 1972, and were entitled to gratuity.

Fact of the Case:

The petitioner, Food Corporation of India, challenged the orders of the Controlling Authority and the Appellate Authority under the Payment of Gratuity Act, 1972, which directed the petitioner to pay gratuity to the workers who were initially appointed as contract labourers under the handling contractor but later received wages directly from the petitioner.

Finding of the Court:

The court held that the workers qualified as employees within the meaning of Section 2(e) of the Payment of Gratuity Act, 1972, and were entitled to gratuity, as they were employed for wages in the petitioner's establishment and the master-servant relationship was established by payment of wages.

Issues: Whether the workers, who were initially appointed as contract labourers under the handling contractor but later received wages directly from the petitioner, qualified as employees within the meaning of Section 2(e) of the Payment of Gratuity Act, 1972, and were entitled to gratuity.

Ratio Decidendi: The court relied on Section 2(e) of the Payment of Gratuity Act, 1972, which defines 'employee' as any person employed for wages in any kind of work in or in connection with the work of an establishment to which the Act applies, and held that the workers satisfied the definition of 'employee' as they were employed for wages in the petitioner's establishment.

Final Decision: The court dismissed the writ petitions filed by the petitioner and directed the Controlling Authority to take immediate steps for disbursal of gratuity in favor of the workers.

JUDGMENT :

Raja Basu Chowdhury, J.

1. Since it has been jointly submitted by the learned advocates for the parties that the issues involved in the aforesaid applications are common, and since all documents are already on record, by consent of the parties the aforesaid applications have been taken up for consideration together. The petitioner, who is common in all applications, has challenged the orders passed by the Controlling Authority and the Appellate Authority, under the Payment of Gratuity Act, 1972 (hereinafter referred to as the “said Act”).

2. It is the petitioner’s contention that at all material point of time, the job of handling and transport of food grains and for supply of casual labourers was performed by the handling contractors. The respondent no.4 in each of the aforesaid applications were originally appointed as contract/casual labourer under the handling contractor under a two year contract period (hereinafter referred to as the “workers”). According to the petitioner, the workers are not its employees and had not been employed in terms of the FCI Staff Regulation, 1971 (hereinafter referred to as the “said Regulation”).

3. Notwithstanding the fact that at all material point of time, the workers having been paid through handling contractors, and a dispute having arisen in connection with the disbursal of wages to the workers, a writ application was filed before this Hon’ble Court. The lis between the parties travelled up to the Hon’ble Supreme Court and finally by and in terms of the order dated 14th January, 2010, the petitioner had been disbursing wages directly to all such contract labourers including the workers.

4. Despite gratuity not being payable to the workers, in terms of the said Regulation or in terms of the order passed by the Hon’ble Supreme Court, the workers had applied in Form ‘N’ before the Controlling Authority.

5. The petitioner had duly contested such proceedings. By the orders which are impugned, the Controlling Authority determined the gratuity payable in favour of the respective workers and issued separate notices in Form ‘R’ calling upon the petitioner to make payment of the gratuity so determined.

6. Being aggrieved, the petitioner filed individual appeals before the Appellate Authority by making pre-deposit, as required under the said Act. Unfortunately the same were dismissed.

7. Challenging the aforesaid orders, the aforesaid writ applications have been filed.

8. Mr. Chattopadhyay, learned advocate representing the petitioner submits that there is no employee-employer relationship between the petitioner and the workers. It is claimed that since, the workers along with other similarly placed persons which, inter alia, includes contract labourers and casual workers, employed by FCI, were not being paid wages at par with the FCI staff, a writ application was filed before this Court, which was registered as WP No. 1491 of 1997. The same ultimately culminated in an order dated 23rd June, 1998, directing the petitioner to make payment of wages to the aforesaid casual labourers/contract labourers, at par with the wages of class IV staff of the writ petitioner.

9. Although the said order was challenged by filing an intra Court Appeal, since, the petitioner was unsuccessful in the said intra Court Appeal, a Special Leave Petition was filed before the Hon’ble Supreme Court and finally by an order dated 14th January, 2010, the said Special Leave Petition, then converted to a Civil Appeal being No.9472-73 of 2003, was disposed of with a direction to make payment of wages and other dues to the workers and other similarly placed persons directly without involving any contractor. By referring to the aforesaid judgment Mr. Chattopadhyay submits that the Hon’ble Supreme Court while directing the petitioner to make payment of the wages directly to the workers, did not grant any relief to the workers and other similarly placed persons, insofar as payment of gratuity is concerned. By further referring to the

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