2000 (4) TMI 826 - SC - Indian Laws

Summary

Issues Involved:
1. Employer-Employee Relationship
2. Legality of Canteen Closure
3. Reinstatement of Canteen Employees
4. Compensation in lieu of Reinstatement

Summary:

Employer-Employee Relationship:
The primary issue was whether the 33 canteen employees of the Indian Overseas Bank (IOB) Staff Canteen should be considered employees of the bank. The Industrial Tribunal, Chennai, held that the canteen employees should be treated as employees of the bank. The Tribunal based its decision on several factors: the canteen was located on the bank's premises, served exclusively the bank staff, operated during bank hours, and was financially supported by the bank. The Tribunal concluded that the bank was effectively running the canteen through the Managing Committee, which consisted of bank employees. The Division Bench of the High Court upheld this finding, emphasizing that the bank had an implicit obligation to run the canteen, similar to the principles laid out in the LIC case.

Legality of Canteen Closure:
The Tribunal found that the closure of the canteen violated Section 25-O(6) of the Industrial Disputes Act, 1947, deeming the closure illegal from its date. The canteen was closed on 26.4.90, and the Tribunal held that the employees were entitled to benefits as if the canteen had not been closed. The Division Bench of the High Court supported this view, noting the bank's continued obligation to provide canteen services.

Reinstatement of Canteen Employees:
The Tribunal ordered the reinstatement of the 33 canteen employees, granting them the same status and facilities as Class IV employees of the bank. The Division Bench upheld this decision, criticizing the Single Judge for re-appreciating the evidence and arriving at a different conclusion. The Supreme Court affirmed the Tribunal's findings, noting that the evidence supported the conclusion that the canteen employees were indeed employees of the bank.

Compensation in lieu of Reinstatement:
The bank's appeal included a request to consider awarding compensation instead of reinstatement. The Supreme Court rejected this request, stating that the canteen services were essential and the bank could utilize the employees' services. The Court emphasized that there was no justification to deny the employees the benefits of their service.

Conclusion:
The Supreme Court dismissed the appeals, affirming the Industrial Tribunal's and Division Bench's decisions. The canteen employees were to be reinstated with the same status and benefits as Class IV employees of the bank, and the closure of the canteen was deemed illegal. The bank's request for awarding compensation in lieu of reinstatement was also denied.