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SUPREME COURT OF INDIA
25-9-1973.
K.K. MATHEW, M.H. BEG AND A.K. MUKHERJEA, JJ.
Silver Jubilee Tailoring House and others; Appellants
Versus
Chief Inspector of Shops and Establishments and another, Respondent.
Civil Appeal No. 1706 of 1969, D/- 2
Andhra Pradesh (Telangana Area) Shops and Establishments Act, 1951 - Section 37A, 15 , 49 , 46 , 2 (14) , 80 - Payment of Wages Act, 1936 - Industrial Disputes Act of 1947 – Section 2 (s) - Factories Act, 1948 - Social Security Act, 1935 - Tailoring House - Workers - Rate of Wages - Contract of Service - Whether High Court of Andhra Pradesh was right in accepting conclusion arrived at by Chief Inspector of Shops and Establishments, Hyderabad that, employer and employee relationship existed between Silver Jubilee Tailoring House - Whether provisions of Act are applicable to establishments - Whether from these circumstances, conclusion drawn by Chief Inspector of Shops and Establishments and High Court that there existed employer and employee relationship between appellants and workers represented by 2nd respondent was correct - Whether employer and employee relationship existed between parties is to see whether so called employer has right to control and supervise manner of work done by workers - Whether right to control manner of work is an exclusive test to determine nature of relationship and even if it is found that is test - Whether facts proved would satisfy requirements of test - Whether agarias were workmen as defined by S. 2 (s) of Industrial Disputes Act of 1947 - Whether they were independent contractors - Whether or not master has right to control manner of execution of work - Whether bidi rollers in question there were workmen within meaning of that therm in Factories Act, 1938 - Whether Pandurang was a workman within meaning of that expression under Factories Act - Whether he was entitled to any leave wages under S. 80 of that Act - Whether relationship of master and servant exists would be unrealistic - Whether search for a formula in nature of a single test to tell a contract of service from a contract for service will serve any useful purpose - Whether employer or workmen supplies instrumentalities, tools, and place of work for person doing work - Whether regular part time service can be considered even prima facie to suggest anything other than a contract of service – Held, Workers attend shop which belongs to employer and work there, on machines, also belonging to him, is a relevant factor - When services are performed generally in employer s premises, this is some indication that contract is a contract of service - It is possible that this is another facet of incidental feature of employment - Workers work on machines supplied by proprietor of shop is an important consideration in determining nature of relationship - If employer provides equipment, this is some indication that contract is a contract of service whereas if other party provides equipment, this is some evidence that he is an independent contractor - It seems that this is not based on theory that if employer provides equipment he retains some greater degree of control, for, as already seen, where control arises only from need to protect one s own property, little significance can attach to power of control for this purpose - Reputation of a tailoring establishment depends not only on cutter but also upon tailors - In many cases, stitching is a delicate operation when cloth upon which it is to be carried on is expensive - Defect in stitching might mar appearance not only of garment but also of its wearer - So when tailor returns a garment, proprietor has got to inspect is to see that it is perfect - Workers are not obliged to work for whole day in shop is not very material - There is of course no reason why a person who is only employed part time, should not be a servant and it is doubtful whether regular part time service can be considered even prima facie to suggest anything other than a contract of service - According to definition in S. 2 (14) of Act, even if a person is not wholly employed, if he is principally employed in connection with business of shop, he will be a "person employed within meaning of sub-section - Therefore, even if he accepts some work from other tailoring establishments or does not work whole time in a particular establishment, that would not in any way derogate from his being employed in shop where he is principally employed – Court think that on facts and circumstances of case Chief Inspector of Shops and Establishments and High Court came to right conclusion that employer and employee relationship existed between parties and that Act was therefore applicable - Appeal dismissed.
Judgment
MATHEW, J.:- In this appeal, by special leave, the question for consideration is whether the High Court of Andhra Pradesh was right in accepting the conclusion arrived at by the Chief Inspector of Shops and Establishments, Hyderabad that, employer and employee relationship existed between the Silver Jubilee Tailoring House and others, the appellants, and the workers represented by the second respondent, and that the provisions of Andhra Pradesh (Telangana Area) Shops and Establishments Act, 1951, hereinafter referred to as the Act. was therefore applicable to the establishments in question.
2. The second respondent representing the workers, made certain claims before the competent authority under Section 37A of the Act read with Section 15 of the Payment of Wages Act, 1936 against the Silver Jubilee Tailoring House and others, the appellants, Thereafter, "the competent authority referred for the decision of the State Government under Section 49 of the Act, the question whether the provisions of the Act are applicable to the establishments. The Government in turn referred the matter to the Commissioner of Labour to whom the power to decide the question was delegated under S. 46 of the Act. He enquired into the matter, heard the parties, but before he cou pass the order, the power to decide the question by the State Government under S. 49 was delegated to the Chief Inspector of Shops and Establishments, Hyderabad. The Chief Inspector of Shops and Establishments thereafter heard the parties and came to the conclusion that the provisions of the Act were applicable to the establishments, as employer and employee relationship existed between the appellants and the workers represented by the second respondent.
3. The appellants filed a writ petition before the High Court to quash this order. The writ petition was dismissed by a learned Single Judge on the basis of his finding that the workers represented by the second respondent union were employed in the establishment within the meaning of S. 2 (14) of the Act, and, therefore, the Act was applicable.
4. The appellants filed an appeal against the decision to the Division Bench of the same Court. The Division Bench dismissed the Appeal in limine.
5. The material part of S. 2 (14) reads as follows:
"person employed means - (1) in the case of a shop, a person wholly or principally employed therein in connection with the business of the shop.
6. Two witnesses were examined to show the nature and character of the work done by the workers. One was the proprietor of one of the establishments and the other the Assistant Inspector of Labour.
7. The following facts appear from the finding of the learned Single Judge. All the workers are paid on piece-rate basis. The workers generally attend the shops every day if there is work. The rate of wages paid to the workers is not uniform. The rate depends upon the skill of the worker and the nature of the work. When cloth is given for stitching to a worker after it has been cut, the worker is told how he should stitch it. If he does not stitch it according to the instruction, the employer rejects the work and he generally asks the worker to restitch the same. When the work is not done by a worker according to the instructions, generally no further work would be given to him. If a worker does not want to go for work to the shop on a days does not make any application for leave, nor is there any obligation on his part to inform the employer that he will not attend for work on that day. If there is no work, the employee is free to leave the shop before the shop closes. Almost all the workers work in the shop. Some workers are allowed to take cloth for stitching to their homes on certain days. But this is done always with the permission of the proprietor of the shop. The machines installed in the shop belong to the proprietor of the shop and the premises and the shop in which the work is carried on also belong to him.
8. The question is whether fr
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