High Court Of Madhya Pradesh
P. R. Sharma, J.
LOKNATH NATHULAL - Appellant
Versus
STATE OF MADHYA PRADESH - Respondents
Criminal Revn. 147 Of 1958
Decided On : 05/09/1959
MINIMUM WAGES ACT - SECTION 2 (E), 2 (G), 2 (I), 18 - SCHEDULE PART I, ITEM NO. 3 - APPLICABILITY TO OUTWORKERS IN BIRI MAKING INDUSTRY - DEFINITION OF 'EMPLOYEE' AND 'EMPLOYMENT' - INTERPRETATION.
Fact of the Case:
The applicant, a contractor, engaged workers to prepare 'biris' from raw materials supplied by him. The workers performed the process at their respective residences. The applicant failed to maintain registers and records as required under the Minimum Wages Act and the Rules framed thereunder. He contended that the Minimum Wages Act did not apply to him as he was not an 'employer' and the workers were not 'in employment in any tobacco or Biri making manufactory'.
Finding of the Court:
The court held that the applicant was an 'employer' within the meaning of Section 2 (E) of the Minimum Wages Act and the workers were 'employees' as defined under Section 2 (I) of the Act. The court interpreted the word 'employment' in the schedule of the Act in the context of the definition of 'employee' and held that outworkers preparing goods at their own residence and supplying them to the employer are to be treated as employees for the purposes of the Minimum Wages Act.
Issues: 1. Whether the applicant was an 'employer' within the meaning of Section 2 (E) of the Minimum Wages Act? 2. Whether the workers engaged by the applicant were 'employees' as defined under Section 2 (I) of the Act? 3. Whether the Minimum Wages Act was applicable to the applicant?
Ratio Decidendi: 1. The court interpreted the definition of 'employee' in Section 2 (I) of the Minimum Wages Act and held that it includes outworkers to whom raw materials are given out by another person to be processed for sale, even if the process is carried out at the outworker's home or in premises not under the control of the employer. 2. The court held that the word 'employment' in the schedule of the Act must be construed in the context of the definition of 'employee' and that outworkers preparing goods at their own residence and supplying them to the employer are to be treated as employees for the purposes of the Minimum Wages Act. 3. The court concluded that the applicant was an 'employer' and the workers engaged by him were 'employees' within the meaning of the Minimum Wages Act, and therefore, the Act was applicable to the applicant.
Final Decision: The court dismissed the revision petition filed by the applicant, upholding the conviction and sentence passed against him for failing to maintain registers and records as required under the Minimum Wages Act and the Rules framed thereunder.
( 1 ) THIS is a revision application against the order elated 6-2-1958 passed by the 3rd Additional Sessions Judge Jubbulpore in Criminal Revision No. 104 of 1957 - whereby he maintained the order of conviction and sentence passed against the applicant by the First Class Magistrate Jabalpur In Criminal Case No. 1784 of 1956. The facts of the case briefly stated arc that the applicant has under an agreement Ex. D/1 contracted to supply to Mohanlal Hargovind 'biris'. The terms of the agreement show that Mohanlal Hargovind was to supply raw materials to the applicant who in his turn was, on his own responsibility as to payment of wages, to engage workers for the purpose of getting 'biris' prepared out of the said raw materials.
( 2 ) THE supply of 'bins' prepared by the workers employed by the applicant was subject to approval of a person to be deputed for this purpose by Mohanlal Hargovind. Mohanlal Hargovind's munim was entitled to check the stock of leaves and tobacco with the applicant. The prosecution case is that the applicant was 'an employer' in Biri making industry at Jubbulpore to which the Minimum Wages Act is applicable. It is a fact admitted by the accused that he failed to maintain registers and record as required under Section 18 of the Minimum Wages Act and Rules 21, 22, 25 and 27 framed thereunder. His contention is that the Minimum Wages Act does not apply to him. In support of this contention the following points were urged before me by the learned counsel for the applicant during the course of his arguments : (1) that the applicant was not an employer within the meaning of Section 2 (E) of the Minimum Wages Act since the relationship of a master and servant did not exist between him and the labourers who prepared 'biris' for him; (2) that the applicant had no tobacco manufactory. The labourers who took the caw materials from him and supplied 'biris' which they prepared out of the said raw material at their respective places of residence could not be said to be 'in employment in any tobacco or Biri making manufactory' within, the meaning of item No. 3 of the schedule Part I of the Minimum Wages Act.
( 3 ) SECTION 2 (g) of the Minimum Wages Act defines scheduled employment as under : "scheduled employment means an employment specified in the schedule or any process or branch of work forming part of such employment. " The schedule mentions at item No. 3 "employment in any tobacco (including Biri making) manufactory. " The contention of the learned counsel for. the applicant is that unless the labourers or workers performing the process of Bill-making work at a defined place, their employment could not be said to be in a Biri making manufactory. Now what is material for the purpose of Section 18 of the Minimum Wages Act is whether the persons who were receiving raw materials from the applicant and preparing Biris out of the same at their respective houses were employees within the meaning of Section 2 (i) of the Minimum Wages Act. Section 2 (i) runs as under : "employee" means any person who is employed for hire or reward to do any work, skilled or unskilled, manual or clerical, in a scheduled employment in respect of which minimum rates of wages have been fixed; and includes an outworker to whom any articles or materials are given out by another person to be made up, cleaned, washed, altered, ornamented, finished, repaired, adapted or otherwise processed for sale for the purposes of the trade or business of that other person where the process is to be earned out either in the home of the out-worker or in some other premises not being premises under the control and management of that other person; and also includes an employee declared to be an employee by the appropriate Government; but does not include any member of the Armed Forces of the Union. "
( 4 ) IT would be clear from the above definition that it includes an out-worker to whom any articles or materials are given out by another person to
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