The court ruled that without establishing an employer-employee relationship, reference under Section 10 of the Industrial Disputes Act is inappropriate; contracts are valid unless proven otherwise.

JUDGMENT :

M.K. THAKKER, J.

1. Rule, returnable forthwith. Learned AGPs Mr. Davda, Mr. Parmar and learned advocate Mr.Patel waive service of notice of Rule on behalf of the respective respondents.

2. Since the issue raised in the these petitions are similar, they are being decided by a common judgment. The facts of Special Civil Application No.10436 of 2025 are taken for the purpose of adjudication.

3. The present petitions are filed challenging the order dated 04.06.2025 passed by the Commissioner of Labour, Gandhinagar in Conciliation Case Nos.97 of 2023 and 103 of 2023.

4. It is the case of the petitioner that the petitioner company has a plant at Gandhinagar, and the present dispute pertains to the employees serving at Sector 28, Gandhinagar. The petitioner has a few employees on its roll in the workmen category, while other employees are working in the staff category. The petitioner has engaged more than 1000 contractual labourers in the plant at Sector 28, Gandhinagar through various contractors, including the contractors who are parties before this Court.

4.1. The State Government has granted licences to the said contractors under the provisions of the Contract Labour (Regulation and Abolition) Act, 1970, for carrying out various contractual works, and certificates to that effect have also been issued to the contractors. For the purposes of wages, allowances, and other benefits of the said contractual labourers, the contractors have entered into long-term settlements with the contractual labourers from time to time. The details of such settlements are provided hereinbelow:

“Settlement dated 11.05.2017 with the contractors during conciliation under Section 12(3) of the I.D. Act, 1947 through one Akhil Gujarat General Mazdoor Sangh ("AGMS") Union for the period between 2016 and 2019. Settlement dated 28.02.2020 with contractors through AGMS Union in Reference (IT) No. 9 of 2020 for the period between 01.04.2019 and 31.03.2023 Settlement dated 29.05.2020 with contractors through Gujarat Shramik Seva Sangh Union under Section 12(3) and 2(p) of the Act for the period between 01.04.2019 and 31.03.2023.

Settlement dated 12.03.2024 with contractors through AGMS Union u/s 2(P) of the I.D. Act, 1947 for the period between 01.04.2023 and 31.03.2027.”

5. It is the case of the present petitioner that the concerned employees are working under the contractors and not under the petitioner company. Respondent No.2 had earlier raised demands on behalf of the contract workers, which came to be admitted in conciliation proceedings and numbered as IDC Case No.158 of 2021. Vide order dated 18.06.2022, the learned Assistant Labour Commissioner disposed of all such demands in view of the settlement arrived at between the contract workers, AGMS Union, and Gujarat Shramik Seva Sangh (‘the GSSS’ referred hereinafter).

5.1. Subsequently, GMS raised further demands by issuing a charter of demands dated 19.05.2023, alleging that the contract between the contractors and the petitioner company is a sham and paper arrangement, and also seeking increase in basic wages and various allowances such as fixed dearness allowance, variable dearness allowance, conveyance allowance, washing allowance, shift allowance, etc.

5.2. The petitioner company submitted its reply on 29.01.2024 before the Conciliation Officer contending that there is no employer-employee relationship between the workers raising the demands and the petitioner company, as they are the employees of the respective contractors.Conciliation meetings were thereafter conducted before t