REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 3433 OF 2007

Maharashtra State Road Transport

Corporation & Anr. …Appellants

Versus

Casteribe Rajya P. Karmchari Sanghatana …Respondents

With

Civil Appeal No. 3434/2007

Civil Appeal No. 3435/2007

Civil Appeal No. 3436/2007

Civil Appeal No. 3437/2007

JUDGMENT

R.M. Lodha, J.

Principally, two questions which this Court is called

upon to determine in this group of five civil appeals by special

leave are:

(one) :Whether a direction to the Maharashtra

State Road Transport Corporation (for short,

“Corporation”) by the Industrial Court, and

confirmed by the High Court of giving status, wages

and all other benefits of permanency, applicable to

the post of Cleaners to the complainants is justified?

(two) :Whether the two complaints filed by

Casteribe Rajya Parivahan Karmchari Sanghatana

(for short, “Union”), an unrecognised union under

Maharashtra Recognition of Trade Unions &

Prevention of Unfair Labour Practices Act, 1971

(for short, “MRTU & PULP Act”), alleging unfair

labour practice on the part of the employer under

item No. 6 of Schedule IV are maintainable?

2. The Union, although a registered union under the

Trade Union Act, but unrecognised under MRTU & PULP

Act, filed two complaints, namely, complaint (ULP) No.

542/1991 and complaint (ULP) No. 574/1991 before the

Industrial Court, Bombay alleging that the Corporation has

indulged in unfair labour practice under item nos. 5,6,9 and 10

of Schedule IV of MRTU & PULP Act. The names of the

affected employees were mentioned in the annexures annexed

with the complaints. All these affected employees were

engaged by the Corporation as casual labourers for cleaning

the buses between the years 1980-85. According to the

complainants, these employees are required to work everyday

at least eight hours at the concerned depot of the Corporation;

the work done by these employees is of permanent nature but

they are being paid a paltry amount; and that the posts of

2

sweepers/cleaners are available in the Corporation yet these

employees have been kept on casual and temporary basis for

years together denying them the benefit of permanency.

3. Another complaint (ULP No. 442 of 1992) was filed

by 19 individual employees before Industrial Court, Thane,

raising the identical dispute.

4. The Corporation resisted these complaints on

diverse grounds. Insofar as the complaints by the Union were

concerned, the Corporation raised the plea that these were

not maintainable as the Union was unrecognised Union

under MRTU & ULP Act. The Corporation stated that the

complainants were engaged for cleaning the buses on

contract basis @ 1.50 paise per bus and they were not

employed as ‘badlis’, casual or temporary workers; that the

engagement of these workers on contract basis is purely of

casual nature; that prior to 1980, the Corporation buses were

being cleaned by regular helpers but some problems arose

amongst the employees later on and, it was decided not to

compel the qualified helpers to clean and sweep the buses;

that since the Corporation was facing acute problem regarding

3

cleaning of the buses and the negotiations were going on with

the respective unions, it was decided that those who volunteer

their services by reporting at the respective depot may be

allowed to clean the buses on contract basis. The Corporation

stated that these workers cannot be provided with the status of

permanency on par with the other permanent cleaners.

5. The parties led oral as well as documentary

evidence before the Industrial Court, Bombay in Complaint

ULP nos. 542 and 574 of 1991 and before Industrial Court,

Thane, in Complaint ULP no. 442/1992.

6. The Industrial Court, Bombay in the two complaints

filed by the Union held that the complaint regarding unfair

labour practice against the Corporation under item 6 of

Schedule IV was not maintainable. However, the complaints

were maintainable in respect of unfair labour practice under

item nos. 5,9 and 10. The Industrial Court held that the

Corporation committed unfair labour practice under items 5

and 9 of Schedule IV of MRTU & PULP Act and vide order

dated May 2, 1995 the Corporation was directed to pay equal

wages to the concerned employees which are paid to

4

Swachhak and pay arrears of wages to them from the date of

filing of the complaints. The Industrial Court, Thane decided

complaint ULP No. 442/1992 vide its order dated February 6,

1997 and held that the Corporation indulged in unfair labour

practice under item 6 of Schedule IV by continuing the

complainants as temporary/casual/daily wage workers for years

together and thereby depriving them the benefits of

permanency. The Industrial Court, Thane, accordingly,

directed the Corporation to cease and desist from the said

unfair practice within one month from the date of the order by

giving status, wages and all other benefits of permanency

applicable to the post of cleaners to the complainants w.e.f.

August 3, 1982.

7. The aforesaid two orders passed by the Industrial

Court, Bombay as well as Industrial Court, Thane came to be

challenged by the Union, the employees and the Corporation

before the High Court of Judicature at Bombay (appellate side)

in five separate writ petitions. The learned single Judge of

the High Court heard these five writ petitions together and

disposed of them by a common judgment on August 2, 2001.

5

The learned single Judge held that the complaints by the

unrecognized union under item 6 of Schedule IV of MRTU &

PULP Act were maintainable and that Corporation indulged in

unfair labour practice under item 6 of Schedule IV. The learned

single Judge also held that there is unfair labour practice on

the part of the Corporation under item no. 5 of Schedule IV as

well. The single Judge, accordingly, directed that employees

mentioned in the two complaints filed by the Union be given

benefit of permanency including salary and allowances from the

date of filing the respective complaints.

8. Aggrieved by the judgment of the single Judge

passed on August 2, 2001, the Corporation preferred five

Letters Patent Appeals which came to be dismissed on May 6,

2005. Hence, these five appeals by special leave.

re: question (one)

9. Mr. Altaf Ahmad, learned Senior Counsel for the

Corporation, heavily relied upon General Standing Order No.

503 dated 19

th

June, 1959 and the decision by the Constitution

Bench of this Court in the case of Secretary, State of Karnataka

and Others vs. Umadevi and Others

1

in assailing the direction

1

(2006) 4 SCC 1

6

of giving status, wages and other benefits of permanency

applicable to the post of cleaners. The learned Senior Counsel

would submit that granting permanent status to employees

who were working as casual workers/daily wagers and whose

appointments were made without following the procedure

prescribed in General Standing Order 503 on non-existent

posts is unsustainable in law. He extensively referred to the

Constitution Bench decision in Umadevi

1

. The learned Senior

Counsel submitted that no direction could be given by the

Court for creation of posts. In this regard, he relied upon two

decisions of this Court viz.: Mahatma Phule Agricultural

University and Others vs. Nasik Zilla Sheth Kamgar Union &

Ors.

2

and Karnataka State Road Transport Corporation and

Anr. vs. S.G. Kotturappa and Anr.

3

10. Mr. Shekhar Naphade, learned Senior Counsel for

the employees and Mr. Vinay Navare, learned counsel for the

Union stoutly defended the direction given to the Corporation in

according permanency and consequential benefits to the

affected employees.

2

(2001) 7 SCC 346

3

(2005) 3 SCC 409

7

11. We deem it appropriate to notice the relevant

provisions of MRTU & PULP Act first. But before we do that it

is important to notice that MRTU & PULP Act was enacted

with an object to provide for the recognition of trade unions for

facilitating collective bargaining for certain undertakings; to

state their rights and obligations; to confer certain powers on

unrecognized unions; to provide for declaring certain strikes

and lockouts as illegal strikes and lockouts; to define and

provide for the prevention of certain unfair labour practices;

to constitute courts (as independent machinery) for carrying out

the purposes of according recognition to trade unions and for

enforcing the provisions relating to unfair labour practices; and

to provide for matters connected with the purposes aforesaid.

12. A “recognized union” under Section 3(13) means a

union which has been issued a certificate of recognition under

Chapter III of the Act.

13. “Unfair labour practice” means those defined in

Section 26. Section 26 defines them to mean the practices

listed in Schedules II, III and IV. Schedule II deals with unfair

labour practices on the part of the employers; Schedule III

8

deals with unfair labour practices on the part of trade unions

and Schedule IV deals with general unfair labour practices on

the part of the employers.

14. Section 21 confers a right upon the recognized

union to appear or act in the proceedings relating to certain

unfair labour practices. It reads thus:

“21. Right to appear or act in proceedings relating to

certain unfair labour practices

(1)No employee in an undertaking to which the

provisions of the Central Act for the time being apply, shall

be allowed to appear or act or allowed to be represented in

any proceedings relating to unfair labour practices specified

in items 2 and 6 of Schedule IV of this Act except through

the recognized union:

Provided that, where there is no recognized union to

appear, the employees may himself appear or act in any

proceeding relating to any such unfair labour practices.

(2)Notwithstanding anything contained in the Bombay

Act, no employee in any industry to which the

provisions of the Bombay Act, for the time being

apply, shall be allowed to appear or act or allowed to

be represented in any proceeding relating to unfair

labour practices specified in items 2 and 6 of

Schedule IV of this Act except through the

representative of employees entitled to appear under

Section 30 of the Bombay Act.”

15. Section 28 reads thus:

“28.Procedure for dealing with complaints relating to

unfair labour practices

9

(1)Where any person has engaged in or is engaging in any

unfair labour practice, then any union or any employee or

any employer or any Investigating Officer may, within

ninety days of the occurrence of such unfair labour

practice, file a complaint before the Court competent to

deal with such complaint either under Section 5, or as the

case may be, under Section 7 of this Act.

Provided that, the Court may entertain a complaint after the

period of ninety days from the date of the alleged

occurrence, if good and sufficient reasons are shown by the

complainant for the late filing of the complaint.

2.The Court shall take a decision on every such complaint

as far as possible within a period of six months from the

date of receipt of the complaint.

3.On receipt of a complaint under sub-section (1), the

Court may, if it so considers necessary, first cause an

investigation into the said complaint to be made by the

Investigating Officer, and direct that a report in the matter

may be submitted by him to the Court, within the period

specified in the direction.

4.While investigating into any such complaint, the

Investigating Officer may visit the undertaking, where

the practice alleged is said to have occurred, and make

such enquiries as he considers necessary. He may also

make efforts to promote settlement of the complaint.

5.The Investigating Officer shall, after investigating into the

complaint under sub-Section (4) submit his report to the

Court, within the time specified by it, setting out the full

facts and circumstances of the case, and the efforts

made by him in settling the complaint. The Court shall,

on demand and on payment of such fee as may be

prescribed by rules, supply a copy of the report to the

complainant and the person complained against.

6.If, on receipt of the repot of the Investigating Officer, the

Court finds that the complaint has not been settled

satisfactorily, and that facts and circumstances of the

case require, that the matter should be further

considered by it, the Court shall proceed to consider it,

and give its decision.

10

7.The decision of the Court, which shall be in writing, shall

be in the form of an order. The order of the Court shall

be final and shall not be called in question in any civil or

criminal court.

8.The Court shall cause its order to be published in such

manner as may be prescribed. The order of the Court,

shall become enforceable from the date specified in the

order.

9.The Court shall forward a copy of its order to the State

Government and such officers of the State Government

as may be prescribed.”

16. Section 30 sets out the powers of Industrial and

Labour Courts as follows:

“30.Powers of Industrial and Labour Courts

(1)Where a Court decides that any person named in the

complaint has engaged in, or is engaging in, any

unfair labour practice, it may in its order –

(a)declare that an unfair labour practice has been

engaged in or is being engaged in by that person, and

specify any other person who has engaged in, or is

engaging in the unfair labour practice;

(b)direct all such persons to cease and desist from such

unfair labour practice, and take such affirmative action

(including payment of reasonable compensation to

the employee or employees affected by the unfair

labour practice, or reinstatement of the employee or

employees with or without back wages, or the

payment of reasonable compensation) as may in the

opinion of the Court be necessary to effectuate the

policy of the Act;

(c)where a recognized union has engaged in or is

engaging in, any unfair labour practice, direct that its

recognition shall be cancelled or that all or any of its

11

rights under sub-section (1) of Section 20 or its right

under Section 23 shall be suspended.

(2)In any proceeding before it under this Act, the Court,

may pass such interim order (including any temporary

relief or restraining order) as it deems just and proper

(including directions to the person to withdraw

temporarily the practice complained of, which is an

issue in such proceeding), pending final decision:

Provided that, the Court may, on an application in that

behalf, review any interim order passed by it.

(3)For the purpose of holding an enquiry or proceeding

under this Act, the Court shall have the same powers

as are vested in Courts in respect of –

(a)proof of facts by affidavit;

(b)summoning and enforcing the attendance of

any person, and examining him on oath.

(c)Compelling the production of documents; and

(d)Issuing commissions for the examination of

witnesses.

(4)The Court shall also have powers to call upon any of

the parties to proceedings before it to furnish in

writing, and in such forms as it may think proper, any

information, which is considered relevant for the

purpose of any proceedings before it, and the party so

called upon shall thereupon furnish the information to

the best of its knowledge and belief, and if so required

by the Court to do so, verify the same in such manner

as may be prescribed.”

17. Section 32 provides that the Court shall have the

powers to decide all connected matters arising out of any

application or a complaint referred to it for the decision under

any of the provisions of this Act.

12

18. Having surveyed the relevant provisions of MRTU &

PULP ACT, it is now time to consider the Constitution Bench

decision in Uma Devi

1

. In paragraph 10, the Constitution

Bench has quoted the order of reference which reads:

“1. Apart from the conflicting opinions between the three-

Judge Bench decisions in Ashwani Kumar v. State of Bihar;

((1997) 2 SCC 1, State of Haryana v. Piara Singh; (1992)4

SCC 118 and Dharwad Distt. PWD Literate Daily Wage

Employees Assn. v. State of Karnataka (1990) 2 SCC 396

on the one hand and State of H.P. v. Suresh Kumar Verma;

(1996) 7 SCC 564, State of Punjab v. Surinder Kumar;

(1992) 1 SCC 489 and B.N. Nagarajan v. State of

Karnataka; (1979) 4 SCC 507 on the other, which have been

brought out in one of the judgments under appeal of the

Karnataka High Court in State of Karnataka v. H. Ganesh

Rao; (2001) 4 Kant LJ 466 (DB), decided on 1-6-2001 the

learned Additional Solicitor General urged that the scheme

for regularisation is repugnant to Articles 16(4), 309, 320 and

335 of the Constitution and, therefore, these cases are

required to be heard by a Bench of five learned Judges

(Constitution Bench).

2. On the other hand, Mr M.C. Bhandare, learned Senior

Counsel, appearing for the employees urged that such a

scheme for regularisation is consistent with the provisions of

Articles 14 and 21 of the Constitution.

3. Mr V. Lakshmi Narayan, learned counsel appearing in

CCs Nos. 109-498 of 2003, has filed the GO dated 19-7-

2002 and submitted that the orders have already been

implemented.

4. After having found that there is conflict of opinion

between the three-Judge Bench decisions of this Court, we

are of the view that these cases are required to be heard by

a Bench of five learned Judges.

5. Let these matters be placed before the Hon’ble the

Chief Justice for appropriate orders.”

13

19. The Constitution Bench in Umadevi

1

considered a

long line of cases; constitutional scheme in public employment;

powers of the High Courts under Article 226; powers of this

Court under Articles 32; other constitutional provisions viz.;

Articles 14, 16, 21 and 309 of the Constitution and laid down

that the High Court acting under Article 226 of the Constitution

could not ordinarily issue directions for regularization and

permanent continuance unless the recruitment itself was made

regularly and in terms of the constitutional scheme. The

Constitution Bench observed thus:

“43. Thus, it is clear that adherence to the rule of equality

in public employment is a basic feature of our Constitution

and since the rule of law is the core of our Constitution, a

court would certainly be disabled from passing an order

upholding a violation of Article 14 or in ordering the

overlooking of the need to comply with the requirements of

Article 14 read with Article 16 of the Constitution. Therefore,

consistent with the scheme for public employment, this Court

while laying down the law, has necessarily to hold that

unless the appointment is in terms of the relevant rules and

after a proper competition among qualified persons, the

same would not confer any right on the appointee. If it is a

contractual appointment, the appointment comes to an end

at the end of the contract, if it were an engagement or

appointment on daily wages or casual basis, the same would

come to an end when it is discontinued. Similarly, a

temporary employee could not claim to be made permanent

on the expiry of his term of appointment. It has also to be

clarified that merely because a temporary employee or a

casual wage worker is continued for a time beyond the term

of his appointment, he would not be entitled to be absorbed

in regular service or made permanent, merely on the

strength of such continuance, if the original appointment was

not made by following a due process of selection as

envisaged by the relevant rules. It is not open to the court to

prevent regular recruitment at the instance of temporary

14

employees whose period of employment has come to an end

or of ad hoc employees who by the very nature of their

appointment, do not acquire any right. The High Courts

acting under Article 226 of the Constitution, should not

ordinarily issue directions for absorption, regularisation, or

permanent continuance unless the recruitment itself was

made regularly and in terms of the constitutional scheme.

Merely because an employee had continued under cover of

an order of the court, which we have described as “litigious

employment” in the earlier part of the judgment, he would not

be entitled to any right to be absorbed or made permanent in

the service. In fact, in such cases, the High Court may not be

justified in issuing interim directions, since, after all, if

ultimately the employee approaching it is found entitled to

relief, it may be possible for it to mould the relief in such a

manner that ultimately no prejudice will be caused to him,

whereas an interim direction to continue his employment

would hold up the regular procedure for selection or impose

on the State the burden of paying an employee who is really

not required. The courts must be careful in ensuring that

they do not interfere unduly with the economic arrangement

of its affairs by the State or its instrumentalities or lend

themselves the instruments to facilitate the bypassing of the

constitutional and statutory mandates.”

20.Pointing out the difference between the concept of “equal

pay for equal work” and the concept of conferring “permanency”

for those who have been appointed on ad hoc basis/ temporary

basis and without any process of selection as envisaged in the

Rules, the Court held:

“44. The concept of “equal pay for equal work” is

different from the concept of conferring permanency on

those who have been appointed on ad hoc basis, temporary

basis, or based on no process of selection as envisaged by

the rules. This Court has in various decisions applied the

principle of equal pay for equal work and has laid down the

parameters for the application of that principle. The

decisions are rested on the concept of equality enshrined in

our Constitution in the light of the directive principles in that

behalf. But the acceptance of that principle cannot lead to a

position where the court could direct that appointments

15

made without following the due procedure established by

law, be deemed permanent or issue directions to treat them

as permanent. Doing so, would be negation of the principle

of equality of opportunity. The power to make an order as is

necessary for doing complete justice in any cause or matter

pending before this Court, would not normally be used for

giving the go-by to the procedure established by law in the

matter of public employment. Take the situation arising in the

cases before us from the State of Karnataka. Therein, after

Dharwad decision the Government had issued repeated

directions and mandatory orders that no temporary or ad hoc

employment or engagement be given. Some of the

authorities and departments had ignored those directions or

defied those directions and had continued to give

employment, specifically interdicted by the orders issued by

the executive. Some of the appointing officers have even

been punished for their defiance. It would not be just or

proper to pass an order in exercise of jurisdiction under

Article 226 or 32 of the Constitution or in exercise of power

under Article 142 of the Constitution permitting those

persons engaged, to be absorbed or to be made permanent,

based on their appointments or engagements. Complete

justice would be justice according to law and though it would

be open to this Court to mould the relief, this Court would not

grant a relief which would amount to perpetuating an

illegality.”

21. The Court deprecated the issuance of directions by

the Court for regularization or making the temporary or casual

employees permanent on the ground that such a person has

worked for a considerable length of time. It was observed:

“45. While directing that appointments, temporary or

casual, be regularised or made permanent, the courts are

swayed by the fact that the person concerned has worked for

some time and in some cases for a considerable length of

time. It is not as if the person who accepts an engagement

either temporary or casual in nature, is not aware of the

nature of his employment. He accepts the employment with

open eyes. It may be true that he is not in a position to

bargain—not at arm’s length—since he might have been

searching for some employment so as to eke out his

livelihood and accepts whatever he gets. But on that ground

alone, it would not be appropriate to jettison the constitutional

16

scheme of appointment and to take the view that a person

who has temporarily or casually got employed should be

directed to be continued permanently. By doing so, it will be

creating another mode of public appointment which is not

permissible. If the court were to void a contractual

employment of this nature on the ground that the parties were

not having equal bargaining power, that too would not enable

the court to grant any relief to that employee. A total embargo

on such casual or temporary employment is not possible,

given the exigencies of administration and if imposed, would

only mean that some people who at least get employment

temporarily, contractually or casually, would not be getting

even that employment when securing of such employment

brings at least some succour to them. After all, innumerable

citizens of our vast country are in search of employment and

one is not compelled to accept a casual or temporary

employment if one is not inclined to go in for such an

employment. It is in that context that one has to proceed on

the basis that the employment was accepted fully knowing the

nature of it and the consequences flowing from it. In other

words, even while accepting the employment, the person

concerned knows the nature of his employment. It is not an

appointment to a post in the real sense of the term. The claim

acquired by him in the post in which he is temporarily

employed or the interest in that post cannot be considered to

be of such a magnitude as to enable the giving up of the

procedure established, for making regular appointments to

available posts in the services of the State. The argument that

since one has been working for some time in the post, it will

not be just to discontinue him, even though he was aware of

the nature of the employment when he first took it up, is not

one that would enable the jettisoning of the procedure

established by law for public employment and would have to

fail when tested on the touchstone of constitutionality and

equality of opportunity enshrined in Article 14 of the

Constitution.”

22. The earlier decisions of this Court in Dharwad

District PWD Literate Daily Wage Employees Assn. vs. State of

Karnataka

4

, State of Haryana vs. Piara Singh

5

, Jacob M.

Puthuparambil vs. Kerala Water Authority

6

and Gujarat

4

(1990) 2 SCC 396

5

(1992) 4 SCC 118

6

(1991) 1 SCC 28

17

Agricultural University vs. Rathod Labhu Bechar

7

were held to

be not laying down correct law and it was held that the

invocation of the doctrine of legitimate expectation cannot

enable the employees to claim that they must be made

permanent or they must be regularized in the service though

they had not been selected in terms of the rules for

appointment. The Constitution Bench went on to hold:

“47. When a person enters a temporary employment or

gets engagement as a contractual or casual worker and the

engagement is not based on a proper selection as

recognised by the relevant rules or procedure, he is aware of

the consequences of the appointment being temporary,

casual or contractual in nature. Such a person cannot invoke

the theory of legitimate expectation for being confirmed in

the post when an appointment to the post could be made

only by following a proper procedure for selection and in

cases concerned, in consultation with the Public Service

Commission. Therefore, the theory of legitimate expectation

cannot be successfully advanced by temporary, contractual

or casual employees. It cannot also be held that the State

has held out any promise while engaging these persons

either to continue them where they are or to make them

permanent. The State cannot constitutionally make such a

promise. It is also obvious that the theory cannot be invoked

to seek a positive relief of being made permanent in the

post.”

23. The argument based on Articles 14 and 16 of the

7

( 2001) 3 SCC 574

18

Constitution of India was also negatived by holding:

“48. It was then contended that the rights of the

employees thus appointed, under Articles 14 and 16 of the

Constitution, are violated. It is stated that the State has

treated the employees unfairly by employing them on less

than minimum wages and extracting work from them for a

pretty long period in comparison with those directly recruited

who are getting more wages or salaries for doing similar

work. The employees before us were engaged on daily

wages in the department concerned on a wage that was

made known to them. There is no case that the wage agreed

upon was not being paid. Those who are working on daily

wages formed a class by themselves, they cannot claim that

they are discriminated as against those who have been

regularly recruited on the basis of the relevant rules. No right

can be founded on an employment on daily wages to claim

that such employee should be treated on a par with a

regularly recruited candidate, and made permanent in

employment, even assuming that the principle could be

invoked for claiming equal wages for equal work. There is no

fundamental right in those who have been employed on daily

wages or temporarily or on contractual basis, to claim that

they have a right to be absorbed in service. As has been

held by this Court, they cannot be said to be holders of a

post, since, a regular appointment could be made only by

making appointments consistent with the requirements of

Articles 14 and 16 of the Constitution. The right to be treated

equally with the other employees employed on daily wages,

cannot be extended to a claim for equal treatment with those

who were regularly employed. That would be treating

unequals as equals. It cannot also be relied on to claim a

right to be absorbed in service even though they have never

been selected in terms of the relevant recruitment rules. The

arguments based on Articles 14 and 16 of the Constitution

are therefore overruled.”

24. The Constitution Bench did not accept the argument

that the right to life protected by Article 21 of the Constitution

19

would include the right to employment. The Court said:

“51. The argument that the right to life protected by

Article 21 of the Constitution would include the right to

employment cannot also be accepted at this juncture. The

law is dynamic and our Constitution is a living document.

May be at some future point of time, the right to employment

can also be brought in under the concept of right to life or

even included as a fundamental right. The new statute is

perhaps a beginning. As things now stand, the acceptance

of such a plea at the instance of the employees before us

would lead to the consequence of depriving a large number

of other aspirants of an opportunity to compete for the post

or employment. Their right to employment, if it is a part of

right to life, would stand denuded by the preferring of those

who have got in casually or those who have come through

the backdoor. The obligation cast on the State under Article

39(a) of the Constitution is to ensure that all citizens equally

have the right to adequate means of livelihood. It will be

more consistent with that policy if the courts recognise that

an appointment to a post in government service or in the

service of its instrumentalities, can only be by way of a

proper selection in the manner recognised by the relevant

legislation in the context of the relevant provisions of the

Constitution. In the name of individualising justice, it is also

not possible to shut our eyes to the constitutional scheme

and the right of the numerous as against the few who are

before the court. The directive principles of State policy have

also to be reconciled with the rights available to the citizen

under Part III of the Constitution and the obligation of the

State to one and all and not to a particular group of citizens.

We, therefore, overrule the argument based on Article 21 of

the Constitution.”

25. In the cases of irregular appointments (not illegal

appointments) and their regularization as one time measure,

however, the Constitution Bench referred to earlier decisions of

this Court in the case of State of Mysore vs.

20

S.V.Narayanappa

8

, R.N. Nanjundappa vs. T. Thimmiah

9

and

B.N. Nagarajan vs. State of Karnataka

10

and said:

“53. One aspect needs to be clarified. There may be

cases where irregular appointments (not illegal

appointments) as explained in S.V. Narayanappa (AIR 1967

SC 1071), R.N. Nanjundappa (1972) 1 SCC 409 and B.N.

Nagarajan (1979) 4 SCC 507 and referred to in para 15

above, of duly qualified persons in duly sanctioned vacant

posts might have been made and the employees have

continued to work for ten years or more but without the

intervention of orders of the courts or of tribunals. The

question of regularisation of the services of such employees

may have to be considered on merits in the light of the

principles settled by this Court in the cases abovereferred to

and in the light of this judgment. In that context, the Union of

India, the State Governments and their instrumentalities

should take steps to regularise as a one-time measure, the

services of such irregularly appointed, who have worked for

ten years or more in duly sanctioned posts but not under

cover of orders of the courts or of tribunals and should

further ensure that regular recruitments are undertaken to fill

those vacant sanctioned posts that require to be filled up, in

cases where temporary employees or daily wagers are being

now employed. The process must be set in motion within six

months from this date. We also clarify that regularisation, if

any already made, but not sub judice, need not be reopened

based on this judgment, but there should be no further

bypassing of the constitutional requirement and regularising

or making permanent, those not duly appointed as per the

constitutional scheme.”

26. The question that arises for consideration is: have

the provisions of MRTU & PULP Act denuded of the statutory

status by the Constitution Bench decision in Umadevi

1

. In our

judgment, it is not. The purpose and object of MRTU & PULP

8

AIR 1967 SC 1071

9

(1972) 1 SCC 409

10

(1979) 4 SCC 507

21

Act, inter alia, is to define and provide for prevention of

certain unfair labour practices as listed in Schedule II, III and IV.

MRTU & PULP Act empowers the Industrial and Labour Courts

to decide that the person named in the complaint has engaged

in or is engaged in unfair labour practice and if the unfair labour

practice is proved, to declare that an unfair labour practice has

been engaged in or is being engaged in by that person and

direct such person to cease and desist from such unfair labour

practice and take such affirmative action (including payment of

reasonable compensation to the employee or employees

affected by the unfair labour practice, or reinstatement of the

employee or employees with or without back wages, or the

payment of reasonable compensation), as may in the opinion of

the Court be necessary to effectuate policy of the Act. The

power given to the Industrial and Labour Courts under Section

30 is very wide and the affirmative action mentioned therein is

inclusive and not exhaustive. Employing badlis, casuals or

temporaries and to continue them as such for years , with the

object of depriving them of the status and privileges of

permanent employees is an unfair labour practice on the part

22

of the employer under item 6 of Schedule IV. Once such unfair

labour practice on the part of the employer is established in the

complaint, the Industrial and Labour Courts are empowered to

issue preventive as well as positive direction to an erring

employer. The provisions of MRTU & PULP Act and the

powers of Industrial and Labour Courts provided therein were

not at all under consideration in the case of Umadevi

1

. As a

matter of fact, the issue like the present one pertaining to unfair

labour practice was not at all referred, considered or decided in

Umadevi

1

. Unfair labour practice on the part of the employer in

engaging employees as badlies, casuals or temporaries and to

continue them as such for years with the object of depriving

them of the status and privileges of permanent employees as

provided in item 6 of Schedule IV and the power of Industrial

and Labour Courts under Section 30 of the Act did not fall for

adjudication or consideration before the Constitution Bench. It

is true that the case of Dharwad District PWD Literate Daily

Wage Employees Assn.

7

arising out of industrial adjudication

has been considered in Umadevi

1

and that decision has been

held to be not laying down the correct law but a careful and

23

complete reading of decision in Umadevi

1

leaves no manner of

doubt that what this Court was concerned in Umadevi was the

exercise of power by the High Courts under Article 226 and

this Court under Article 32 of the Constitution of India in the

matters of public employment where the employees have been

engaged as contractual, temporary or casual workers not based

on proper selection as recognized by the rules or procedure

and yet orders of their regularization and conferring them

status of permanency have been passed. Umadevi

1

is an

authoritative pronouncement for the proposition that Supreme

Court (Article 32) and High Courts (Article 226) should not issue

directions of absorption, regularization or permanent

continuance of temporary, contractual, casual, daily wage or

ad-hoc employees unless the recruitment itself was made

regularly in terms of constitutional scheme. Umadevi

1

does not

denude the Industrial and Labour Courts of their statutory

power under Section 30 read with Section 32 of MRTU &

PULP Act to order permanency of the workers who have been

victim of unfair labour practice on the part of the employer

under item 6 of Schedule IV where the posts on which they

24

have been working exists. Umadevi cannot be held to have

overridden the powers of Industrial and Labour Courts in

passing appropriate order under Section 30 of MRTU & PULP

Act, once unfair labour practice on the part of the employer

under item 6 of Schedule IV is established.

27. There cannot be any quarrel to the proposition that

courts cannot direct creation of posts. In Mahatma Phule

Agricultural University and Others vs. Nasik Zilla Sheth Kamgar

Union and Others

11

, this Court held:

"12. Mrs Jaising, in support of Civil Appeals Nos. 4461-

70 and 4457-60 [arising out of SLPs (C) Nos. 418-21 of 1999

and SLPs (C) Nos. 9023-32 of 1998] submitted that the

workmen were entitled to be made permanent. She however

fairly conceded that there were no sanctioned posts

available to absorb all the workmen. In view of the law laid

down by this Court the status of permanency cannot be

granted when there are no posts. She however submitted

that this Court should direct the Universities and the State

Governments to frame a scheme by which, over a course of

time, posts are created and the workmen employed on

permanent basis. It was however fairly pointed out to the

Court that many of these workmen have died and that the

Universities have by now retrenched most of these

workmen. In this view of the matter no useful purpose would

be served in undergoing any such exercise.

13. To be seen that, in the impugned judgment, the High

Court notes that, as per the law laid down by this Court,

status of permanency could not be granted. In spite of this

the High Court indirectly does what it could not do directly.

The High Court, without granting the status of permanency,

grants wages and other benefits applicable to permanent

employees on the specious reasoning that inaction on the

part of the Government in not creating posts amounted to

unfair labour practice under Item 6 of Schedule IV of the

MRTU & PULP Act. In so doing the High Court erroneously

11

(2001) 7 SCC 346

25

ignores the fact that approximately 2000 workmen had not

even made a claim for permanency before it. Their claim for

permanency had been rejected by the award dated 20-2-

1985. These workmen were only seeking quantification of

amounts as per this award. The challenge, before the High

Court, was only to the quantification of the amounts. Yet by

this sweeping order the High Court grants, even to these

workmen, the wages and benefits payable to other

permanent workmen.

14. Further, Item 6 of Schedule IV of the MRTU & PULP

Act reads as follows:

“6. To employ employees as ‘badlis’, casuals or

temporaries and to continue them as such for years, with the

object of depriving them of the status and privileges of

permanent employees.”

The complaint was against the Universities. The High Court

notes that as there were no posts the employees could not

be made permanent. Once it comes to the conclusion that

for lack of posts the employees could not be made

permanent, how could it then go on to hold that they were

continued as “badlis”, casuals or temporaries with the object

of depriving them of the status and privileges of permanent

employees? To be noted that the complaint was not against

the State Government. The complaint was against the

Universities. The inaction on the part of the State

Government to create posts would not mean that an unfair

labour practice had been committed by the Universities. The

reasoning given by the High Court to conclude that the case

was squarely covered by Item 6 of Schedule IV of the MRTU

& PULP Act cannot be sustained at all and the impugned

judgment has to be and is set aside. It is however clarified

that the High Court was right in concluding that, as per the

law laid down by this Court, status of permanency could not

be granted. Thus all orders wherein permanency has been

granted (except award dated 1-4-1985 in IT No. 27 of 1984)

also stand set aside.”

28. In the case of State of Maharashtra and Another

vs. R.S.Bhonde and Ors.

12

, this Court relied upon earlier

judgment in the case of Mahatma Phule Agricultural University

12

(2005) 6 SCC 751

26

and reiterated the legal position thus:

“. Additionally, as observed by this Court in Mahatma Phule

Agricultural University v. Nasik Zilla Sheth Kamgar Union (2001)

7 SCC 346 the status of permanency cannot be granted when

there is no post. Again in Gram Sevak Prashikshan Kendra v.

Workmen (2001) 7 SCC 356, it was held that mere continuance

every year of seasonal work obviously during the period when

the work was available does not constitute a permanent status

unless there exists post and regularisation is done.”

29. In the case of Indian Drugs & Pharmaceuticals

Ltd. vs. Workmen, Indian Drugs & Pharmaceuticals Ltd.

13

, this

Court stated that courts cannot create a post where none

exists. In paragraph 37 of the report, this Court held:

“37. Creation and abolition of posts and regularisation are

purely executive functions vide P.U. Joshi v. Accountant General

(2003) 2 SCC 632. Hence, the court cannot create a post where

none exists. Also, we cannot issue any direction to absorb the

respondents or continue them in service, or pay them salaries of

regular employees, as these are purely executive functions. This

Court cannot arrogate to itself the powers of the executive or

legislature. There is broad separation of powers under the

Constitution, and the judiciary, too, must know its limits.”

30. In yet another case of Divisional Manager, Aravali

Golf Club and Another vs. Chander Hass and Another

14

, this

13

(2007) 1 SCC 408

14

(2008) 1 SCC 683

27

Court said:

“15. The court cannot direct the creation of posts.

Creation and sanction of posts is a prerogative of the

executive or legislative authorities and the court cannot

arrogate to itself this purely executive or legislative

function, and direct creation of posts in any organisation.

This Court has time and again pointed out that the

creation of a post is an executive or legislative function

and it involves economic factors. Hence the courts

cannot take upon themselves the power of creation of a

post. Therefore, the directions given by the High Court

and the first appellate court to create the posts of tractor

driver and regularise the services of the respondents

against the said posts cannot be sustained and are

hereby set aside.”

31. Thus, there is no doubt that creation of posts is not

within the domain of judicial functions which obviously pertains

to the executive. It is also true that the status of permanency

cannot be granted by the Court where no such posts exist and

that executive functions and powers with regard to the creation

of posts cannot be arrogated by the Courts. However, the

factual matrix of the present controversy reveals that it was an

admitted position before the Industrial Court, Thane in

Complaint (ULP) No. 442/92 that the posts of cleaners in the

Corporation were in existence. The Industrial Court, Thane

recorded the following findings:

“9.Undisputedly, there are posts of cleaners in the

Corporation and not only these employees but the other

28

regularly appointed are working under the supervision and

control of the Corporation’s officers and Supervisors. The

Respondent Corporation has filed the statement showing

attendance of these Complainants in different depots showing

the day from which the work was allotted during the period

from 1992 to 1994. It is at Ex.C-9. This document is already

referred above. Therefore, the case of the complainants

that they are working in different depots is not a disputed

one. It is for the corporation to point out how many posts are

in the depot and how many persons are working in those

depots. Therefore, it cannot be said that for want of any

material on record that all these persons cannot be absorbed

in permanent posts. When there is deliberate attempt on the

part of the corporation not to employ them as regular

employees in the posts of cleaners for years together the

intention is very clear and in my opinion, this is the fit case

where the declaration under item 6 of Schedule V of the Act

will have to be given.”

32. The Industrial Court at Bombay in its order dated

May 2, 1995 while dealing with Complaint (ULP) Nos. 542 and

574/1991 on the basis of the evidence on record recorded the

findings thus:

“…….the employees covered by the complainants

are doing the job of washing, cleaning buses and, the work was

done round the clock. The work at washing, cleaning buses was

previously done by the helpers, who in the 4

th

category, and their

salaries grade begins from Rs. 875-12-1055-15-1145, whereas

the grade of Swachak, which is also in 4

th

category begins from

750-12-970-14-940. These categories are mentioned in

Maharashtra S.T. Samachar. It is the publication of the

M.S.R.T.C. and, the said document is filed in comp. (ULP) No.

574/91 along with complaint below Ex. U-4. Schedule-A gives

salary grades of various employees. The category of Swachhak

is at Sr. No. 1, and category of helper is at Sr. No. 15. Therefore,

it is very clear that, the rest of Swachhak was already mentioned

in the 4

th

category of the schedule. Witness examined by the

Corporation Mr. Deekar has admitted in his evidence that,

“examination” previously job which was being done by the helper

is now being done by the employees covered by these

29

complainants. “No further admits that, “ the helpers who were

doing the job previously were the regular and permanent

employees of the respondent Corporation work round the clock.

He also admits that, since the depots of the respondent

corporation work round the clock, these Swachhaks are also

required to work around the clock, and therefore, they are divided

in three shifts. He admits that, even as on today, there are some

employees in the Respondent Corporation that, they are

designated as Swachhak, and they are getting such higher salary

than the employees covered by the complaint. The employees

covered by the complaints were previously paid Rs. 10.50 per

day, and the same mode of payment was converted in the piece

rate basis. “The witness further admitted that, cleanliness of the

bus is incidental and part and parcel of plying, and the buses

have to run regularly.” It is further admitted position that, these

employees have been in the employment of the Respondent for

last several years, and they have been paid much less salary

when so called regular employees working as Swachhak. They

have also been deprived the benefits of settlements and other

facilities. The Respondents claim that they were appointed as

time gap arrangement, the Respondents have failed to show as

to how the helpers legitimately did not do the job of Swachhak.

Therefore, those employees were appointed on piece rate basis.

Presuming that, it was the right of the respondents to appoint the

Swachhak on piece rate basis, then also, it is admitted position

that, they were asked to do the same work, which Swachhak

employed by the Corporation were doing. Therefore, point at

discrimination has been made very much clear by the

complainants. In respect of dates of appointment and, number of

years of service, the witness of the complainants has stated

firmly that, they are working since long time, and then the fact

regarding appointment was never disputed by the Corporation.

The Respondent has admitted record regarding the

appointments of employees but, they have neither produced any

record, nor contradicted the statements made by the witness of

the complainants except giving some suggestion that, they have

not worked on regular basis. Therefore, evidence of the witness

remained unchallenged. Hence it is very much clear that, the

complainant has established that, the employees covered by the

complaints are doing the job of regular nature, and their work

continued round the clock, which were divided; in each shift

being 8 hours. It is also already proved that, the employees

covered under this complaint doing identical job as that of regular

Swachhak appointed by the Respondent Corporation, and these

Swachhak got much higher salary and other benefits than, the

employees covered by this complaint.”

30

33. In view of the findings recorded by the Industrial

Court, Thane as well as Industrial Court, Bombay, it can be

safely held that the posts of cleaners exist in the Corporation.

No factual foundation has been laid by the Corporation that the

posts of cleaners do not exist in the Corporation, rather the

evidence on record reflects otherwise.

34. The question, now, remains to be seen is whether

the recruitment of these workers is in conformity with Standing

Order 503 and, if not, what is its effect? No doubt, Standing

Order 503 prescribes the procedure for recruitment of Class IV

employees of the Corporation which is to the effect that such

posts shall be filled up after receiving the recommendations

from the Service Selection Board and this exercise does not

seem to have been done but Standing Orders cannot be

elevated to the statutory rules. These are not statutory in

nature. We find merit in the submission of Mr.Shekhar

Naphade, learned Senior Counsel that Standing Orders are

contractual in nature and do not have a statutory force and

breach of Standing Orders by the Corporation is itself an unfair

31

labour practice. The concerned employees having been

exploited by the Corporation for years together by engaging

them on piece rate basis, it is too late in the day for them to

urge that procedure laid down in Standing Order No. 503

having not been followed, these employees could not be given

status and principles of permanency. The argument of the

Corporation, if accepted, would tantamount to putting premium

on their unlawful act of engaging in unfair labour practice. It

was strenuously urged by the learned Senior Counsel for the

Corporation that industrial court having found that the

Corporation indulged in unfair labour practice in employing the

complainants as casuals on piece rate basis, the only direction

that could have been given to the Corporation was to cease

and desist from indulging into such unfair labour practice and

no direction of according permanency to these employees

could have been given. We are afraid, the argument ignores

and overlooks the specific power given to the Industrial/Labour

Court under Section 30(1)(b) to take affirmative action against

the erring employer which as noticed above is of wide

amplitude and comprehends within its fold a direction to the

32

employer to accord permanency to the employees affected by

such unfair labour practice.

35.Seen thus, the direction of giving status, wages and all

other benefits of permanency applicable to the post of cleaners

to the complainants, in the facts and circumstances, is justified

and warrants no interference. Question (one) is answered

accordingly.

re. : question (two)

36.A recognised union is a union which has been issued a

certificate of recognition under Chapter III of MRTU & PULP

Act. In terms of Section 2, no employee in an undertaking to

which the provisions of Industrial Disputes Act apply, shall be

allowed to appear or act or be represented in the proceedings

relating to unfair labour practices specified in items 2 and 6 of

Schedule IV except through the recognized union. Schedule IV

deals with general unfair labour practices on the part of the

employers. Item 6 covers unfair labour practice on the part of

the employer to employ badlis, casual or temporaries and to

continue them as such for years with the object of depriving

them of the status and privileges of permanent employees.

33

Section 28 is a procedural provision with regard to complaints

relating to unfair labour practices.

37. In the case of Shramik Uttakarsh Sabha vs.

Raymond Woollen Mills Ltd. and Others.

15

this Court after

extensively surveying the provisions of MRTU & PULP Act and

on consideration of the judgments in Girja Shankar Kashi Ram

vs. Gujarat Spg. & Wvg. Co. Ltd.19

16

, Santuram Khudai vs.

Kimatrai Printers & Processors(P) Ltd,

17

Workers’ Union V.

Balmer Lawrie and Co. Ltd.

18

and Crescent Dyes and

Chemicals Ltd. vs. Ram Naresh Tripathi

19

held thus:

“14. Section 21 of the MRTU & PULP Act, upon which

emphasis was laid on behalf of the appellants, states that no

employee in an undertaking to which the provisions of the

Industrial Disputes Act applies shall be allowed to appear or act

or be allowed to be represented in any proceeding relating to the

unfair labour practices specified in Items 2 and 6 of Schedule IV

except through the recognised union. It is important to note that

the reference is to employees in an undertaking to which the

Industrial Disputes Act applies and not to employees in an

undertaking to which the BIR Act applies. Apart therefrom, the

section permits an employee, not a union other than the

recognised union, to so appear. The provisions of Section 21 do

not, therefore, lead to the conclusion that a union other than a

representative union can appear in proceedings relating to all

unfair labour practices other than those specified in Items 2 and

6 of Schedule IV.”

15

(1995) 3 SCC 78

16

1962 Supp (2) SCR 890

17

(1978) 1 SCC 162

18

1984 Supp. SCC 663

19

(1993) 2 SCC 115

34

38. It is important to bear in mind that the concept of

recognition of unions has been introduced in MRTU & PULP

Act with a view to facilitate the collective bargaining for the

employees in certain undertakings. In respect of unfair labour

practices specified in items 2 & 6 of the Schedule IV, it is

provided in Section 21 that in respect of such items no

employee in an undertaking to which the provisions of

Industrial disputes Act applies shall be allowed to appear or act

or be allowed to be represented except through the

recognized union. The expression, “ to appear or act or

allowed to be represented” in Section 21(1) is of wide import,

comprehensive and embraces within itself the act of filing

complaint, leading evidence, examination and cross

examination of witnesses and audience before the Industrial

Court/Labour Court. There is nothing to control the expression,

“ to appear or to act or allowed to be represented” as used in

Section 21(1). It is referable to all kinds of acts by the

recognized union in the proceedings relating to unfair labour

practices specified in items 2 and 6 of the Schedule IV.

Section 21(1) excludes individual employees, unrecognized

35

union or any other form of association or union other than

recognized union under MRTU & PULP Act to appear or act or

be represented in the proceedings relating to unfair labour

practices specified in items 2 and 6 of Schedule IV. It is only

recognized union which has been empowered to espouse the

cause relating to unfair labour practices specified in items 2 and

6 of Schedule IV in the proceedings before Industrial/Labour

Court. Section 21(1) is a special provision in respect of

appearance, act and representation in respect of the complaints

filed under Section 28 relating to unfair labour practices

specified in items 2 and 6 of Schedule IV. Section 21, thus,

creates a bar on unrecognized union from acting, appearing or

representing any employee(s) in a proceeding relating to unfair

labour practices under items 2 and 6 of Schedule IV. The right

to represent the employee(s) in matters relating to unfair labour

practices in items 2 and 6 of Schedule IV of the Act under

Section 21 is exclusively available to the recognised union and

none else.

39. Learned Counsel for the unrecognized union,

however, relied upon a decision of the Bombay High Court in

36

the case of Petroleum Employees Union vs. Bharat Petroleum

Corporation Ltd. and Another

20

.

40. In the case of Petroleum Employees Union, the

learned Single Judge (S.P.Bharucha, J. as his Lordship then

was) interpreted Section 21 in the following manner:

“5.The correct interpretation to place upon section

21 is this: Where there is a recognised union only that

recognized union can be allowed, on behalf of an employee,

to appear or; act or be represented in proceedings relating to

unfair labour practices specified in Items 2 and 6 of the

fourth schedule. Where there is no recognized union an

employee may himself appear or act in any proceeding

relating to such unfair labour practice. This does not mean

that an unrecognized union cannot; act or appear in a

proceeding relating to such unfair labour practice. It can

represent an employee or the employee may appear himself

if he so chooses.”

41. The interpretation of Section 21 in Petroleum

Employees Union is not a correct interpretation and, with

respect, we are unable to find ourselves in agreement with that

interpretation. As a matter of fact, the learned Judge (S.P.

Bharucha, J. as his Lordship then was) while adorning the

bench of this Court in the case of Raymonds Wool Mills Ltd.

took exactly diametrically opposite view with regard to

Interpretation of Section 21 that we have already noticed in the

earlier part of our judgment. We respectfully agree with the

20

1983 MJ 618

37

view of this Court in Raymonds Wool Mills Ltd. We hold, as it

must be, that the unrecognized union is not competent to file a

complaint in so far as unfair labour practices under Item nos. 2

and 6 of Schedule IV of MRTU & PULP Act is concerned.

42. In what we have held above, the affected

employees in the two complaints filed by the unrecognized

union may not be entitled to the benefits of permanency to the

post of cleaners as these complaints are not maintainable. But

in the present fact situation, in our judgment, it would be

travesty of justice if at this stage because of non-maintainability

of the complaints at the instance of the unrecognized union,

these employees are deprived of the benefits of status, wages

and permanency applicable to the post of cleaners when

similarly situated employees who had filed the complaint

individually would get benefits of permanency applicable to the

post of cleaners. In view of this exceptional situation, for doing

complete justice between the parties, in exercise of our plenary

power under Article 142 of the Constitution of India, although

we have answered question(two) in favour of the Corporation

that the two complaints filed by Casteribe Rajya P.

38

Kararmchari Sanghthans are not maintainable in so far as

unfair labour practices under item 6 of Schedule IV is

concerned yet in the facts and circumstances of the case, we

direct that the employees in these two complaints would also

get the status, wages and other benefits of permanency

applicable to the post of cleaners as the employees in

complaint (ULP) No. 442/92.

43. In what we have discussed above, all these five

appeals must fail and are dismissed with no order as to costs.

……………………J

(Tarun Chatterjee)

…….……………..J

(R. M. Lodha)

New Delhi

August 28, 2009.

39