1990 (2) TMI 267 - SC - Indian Laws

Whether the employees of the Statutory canteens were the employees of the Railway Establishment, finder the Factories Act and get a pronouncement on the same? - Held that - Writ Petitions and appeals of these employees are allowed. The workers engaged in the statutory canteens as well as those engaged in nonstatutory recognised canteens in the Railway Establishments are railway employees and they are entitled to be treated as such. As far as the employees in non-statutory non-recognised canteens are concerned their petitions are dismissed.

Issues Involved:
1. Whether the employees of statutory canteens are railway employees for the purposes of the Factories Act.
2. Whether the employees of statutory canteens are railway employees for all other purposes.
3. Whether the employees of non-statutory recognized canteens are railway employees.
4. Whether the employees of non-statutory non-recognized canteens are railway employees.

Detailed Analysis:

1. Statutory Canteens:
The court examined Section 46 of the Factories Act, 1948, which mandates the provision of canteens in factories employing more than 250 workers. The court noted that railway establishments fall under this definition. The court reviewed the history of litigation, including a writ petition filed by workers in the South Eastern Railways Workshop, Kharagpur, which resulted in the Calcutta High Court recognizing them as railway employees under the Factories Act. This was affirmed by the Supreme Court in 1980, with the caveat that the Union of India could seek a final pronouncement in an appropriate case. The court considered various administrative instructions and circulars issued by the Railway Board, which treated canteen employees as railway servants for certain purposes, including pay scales and retirement benefits. The court concluded that the employees in statutory canteens are railway employees for the purposes of the Factories Act, as the canteens are incidental to the manufacturing process and the railway administration exercises significant control over their operations.

2. Railway Employees for All Purposes:
The court rejected the argument that recognizing canteen employees as railway employees would lead to similar claims from other welfare activity employees. The court emphasized that its decision was based on the specific facts and legal framework applicable to canteen employees. The court noted that the administrative instructions and notifications applicable to canteen employees in other government departments should also apply to railway canteen employees to avoid discrimination. The court held that the employees in statutory canteens should be treated as railway servants for all purposes, as there was no material difference in their work or conditions compared to other government department canteen employees.

3. Non-Statutory Recognized Canteens:
The court examined the provisions of the Railway Establishment Manual, which mandates the establishment of canteens for staff welfare where the strength is 100 or more. These canteens require prior approval from the Railway Board and are subject to similar management and financial regulations as statutory canteens. The court noted that the employees in these canteens receive similar benefits, including medical treatment, railway passes, and provident fund coverage. The court found no material difference between statutory and non-statutory recognized canteens in terms of management and service conditions. The court held that employees in non-statutory recognized canteens should also be treated as railway servants for all purposes, effective from April 1, 1990.

4. Non-Statutory Non-Recognized Canteens:
The court distinguished non-statutory non-recognized canteens as those not approved by the Railway Board and lacking formal management and financial support from the railway administration. These canteens are run by private contractors with no continuity or control by the railway administration. The court found that the workers in these canteens do not have a consistent employment relationship with the railway administration and are not entitled to the status of railway servants.

Conclusion:
The court concluded that workers in statutory and non-statutory recognized canteens are railway employees and entitled to be treated as such, with benefits effective from specified dates. The petitions and appeals of these employees were allowed. However, the petitions of employees in non-statutory non-recognized canteens were dismissed.

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