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2025 Supreme(Online)(Mad) 11495

IN THE HIGH COURT OF JUDICATURE AT MADRAS
A.D. Maria Clete, J
Management, Tamil Nadu Co-operative Milk Producers Federation – Appellant
Versus
Deputy Director, Industrial Safety and Health Department – Respondent
W.P.No. 25636 of 2021|W.P.No. 25642 of 2021



Advocates:
For the Appellants/Petitioners: D.Venkatesan, M.Selvalingam
For the Respondents: R.Kumaravel, K.Elango, S.Sivakumar, J.Prathaban, S.Rudranath

A special statute with a non-obstante clause governing the permanent status of workmen overrides general service rules and administrative policies. Once a workman meets the statutory requirement of continuous service, the employer cannot deny regularization based on a lack of sanctioned posts or recruitment irregularities.

Headnote:(A) Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981 - Section 3 - Applicability of statute to co-operative institutions - The Act contains a non obstante clause that prevails over any law, service rules, government orders or instructions for the time being in force regarding the conferment of permanent status to workmen who have completed 480 days of service in a continuous period of 24 calendar months. (Para 12)

(B) Burden of Proof - Industrial Disputes - In cases where a workman is hired on a daily wage basis and has difficulty accessing official documents such as muster rolls, if the workman deposes regarding their service, the burden of proof shifts to the employer to establish that the workman did not complete the required number of days to constitute statutory continuous service. (Para 8)

(C) Industrial Law - Unfair Labour Practice - The provisions of the Industrial Disputes Act regarding the prohibition of unfair labour practices, specifically engaging employees as casual or temporary for long periods without granting them the status and privileges of permanent employees, are not excluded by general principles regarding regularization. (Para 9)

Facts of the case:
The employer challenged orders issued by a competent authority directing the regularization of daily wage workmen. The employer contended that the workmen had not completed the mandatory period of service and that the specific government orders for regularization were inapplicable to them. The workmen submitted evidence of their service, including official identification and provident fund documentation. The authority concluded that the statutory requirement of 480 days of service within 24 months had been satisfied.

Findings of Court:
The court found that the authority correctly applied the statutory provisions and that the workers were indeed employees entitled to the protections of the governing legislation. The court rejected the argument that the absence of sanctioned posts or recruitment via employment exchange could negate the rights conferred by the statute.

Issues: Whether the workmen were entitled to permanent status under the governing state legislation despite the management's claim that they were casual workers and that no sanctioned posts were available for them.

Ratio Decidendi: The court held that the governing state statute is a special enactment with a non obstante clause that overrides other service rules or administrative orders. Once the threshold of continuous service prescribed by the statute is met, the management cannot deny permanent status by pointing to a lack of sanctioned posts or improper recruitment channels.

Result: Both writ petitions were dismissed.

Table of Content
1. applicability of tn act 46 of 1981 for permanent status. (Para 2 , 3 , 4 , 5 , 6)
2. employer bears the burden of proof for service duration. (Para 7 , 8)
3. umadevi case does not override special state legislation. (Para 9 , 10)
4. section 3(1) non-obstante status prevails over internal rules. (Para 11 , 12)
5. judicial affirmation of conferring permanent status to workmen. (Para 13 , 14)

C O M M O N J U D G M E N T

1.Heard.

2.The Petitioner is the Co-operative Milk Producers Union of Tiruvannamalai District. These writ petitions have been filed challenging the orders passed by the 1st Respondent, the competent authority under the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981. By the impugned orders dated 16.03.2020, the authority directed the Petitioner Union to confer permanent status upon 19 workmen, whose details are the subject matter of these writ petitions. The authority held that each of the said workmen had completed 480 days of service within a continuous period of 24 calendar months, thereby satisfying the statutory requirement for conferment of permanent status. The annexures to the impugned orders enumerate the names of the workmen, their respective dates of initial engagement, their designations, and the dates from which they were deemed to have acquired permanent status.

3.When both writ petitions were listed for admission on 03.12.2021, this Court ordered notice to the Respondents and granted an interim stay of the impugned orders. Pursuant to such notice, the Respondents entered appearance through counsel and have filed counter affidavits dated 18.10.2023 in both writ petitions. The principal ground urged by the Petitioner Union is that the workmen in question were engaged on a daily wage basis at the Dairy-cum- Powder Plant at Ammapalayam. In addition to the regular employees, the Petitioner submits that casual labourers were engaged intermittently for tasks such as packing of milk powder, storage, and loading of goods into lorries.

4.It was contended although the workmen were covered under the provisions of the Employees’ Provident Funds and Miscellaneous Provisions Act and the Employees’ State Insurance Act, the mere applicability of those statutes does not, by itself, confer upon them the status of regular employees. The Petitioner also contends that the benefit of G.O. (Ms) No. 74, Personnel and Administrative Reforms Department, dated 27.06.2013—which provided for the regularisation of employees engaged on daily wages for ten years as on 01.01.2006—would not be applicable to the present set of workmen. Nevertheless, the concerned workers individually approached the 1st Respondent Authority seeking conferment of permanent status. In respect of the first writ petition, the claims of 17 workmen were consolidated and registered as Case No. 1 of 2018, and notice was issued to the Petitioner Union. Likewise, in respect of one Mr. V. Chennan, a separate proceeding was initiated and numbered as Case No. 1 of 2019. Along with their respective applications, the workmen had submitted their identity cards and Provident Fund receipts as documentary proof in support of their claims.

5.Upon receipt of notice in both cases, the Petitioner Union filed a counter statement opposing the claims of the workmen. In the said statement, it was contended that the contesting Respondents had never worked continuously for 240 days in any calendar year and, therefore, did not satisfy the statutory criteria for conferment of permanent status. It was further asserted that the Government Order relating to regularisation was inapplicable to them and, in the absence of valid orders of regular appointment, no claim for permanency could be sustained. The 1st Respondent Authority, after clubbing both matters, proceeded to pass a common order dated 16.03.2020.

6.In the impugned order, the Authority concluded that the provisions of the Tamil Nadu Industrial Establishments (Conferment of Per

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