2024 (6) TMI 1100 - SC - Indian Laws

Applicability of Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981 to the Corporation qua the employees and their Union - suggestion to institute an Industrial Disputes Claim questioning non-employment was sustainable or not, given that the Inspector of Labour had already passed orders in that regard. Whether the Corporation can be termed as an industrial establishment as per the provisions reproduced supra and whether the members of the Union would qualify as workmen and therefore would be eligible for permanent status under Section 3 of the Act? - HELD THAT - For any establishment to be commercial, it has to be established that the activities undertaken by it are for making some monetary gain. Commercial in the most rudimentary sense means buying or selling of goods in exchange of money - this act shall not apply to those workmen who are engaged in the construction of buildings and the like or other construction work be it structural, mechanical, or electrical. Therefore, those establishments and their workmen shall be exempt, who are engaged exclusively, in the work of construction. Both requirements, of the establishment being covered under the definition of industrial establishment as provided and that of the employee having uninterruptedly continued in service for 480 days or more for 24 months, having been met there are no hesitation in holding that the Act would apply to the parties to the present dispute. Whether the High Court on remand, could have ignored the order of the Inspector of Labour and suggested that the employees raise an industrial dispute questioning their non-employment? - HELD THAT - Since the High Court concluded that the Act would apply, there was no reason for it to disturb the finding of the Inspector of Labour and, therefore, it ought to have simply ordered that the order of Inspector of Labour which concluded that the members of the respondent-Union be given permanent employment, be complied with. When an issue stands already decided and such decision does not suffer from any vice of authority or jurisdiction then, putting those who enjoy an order in their favour through the wringer once more of having to re-establish their claim, this time before the authority under the Industrial Disputes Act, 1947, would be unjustified. The appeal filed by the Corporation is dismissed.

Summary

Issues Involved:
1. Applicability of the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981 to the parties.
2. Sustainability of suggesting an 'Industrial Disputes Claim' questioning non-employment given the Inspector of Labour's prior orders.

Issue-wise Detailed Analysis:

1. Applicability of the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981:

The core issue was whether the Tamil Nadu Medical Services Corporation Limited (the Corporation) qualifies as an industrial establishment under the Tamil Nadu Industrial Establishments (Conferment of Permanent Status to Workmen) Act, 1981 (the Act). The High Court and the Inspector of Labour both concluded that the Corporation is indeed an industrial establishment as defined under Section 2(3)(e) of the Act, which includes establishments as defined under the Tamil Nadu Shops and Establishments Act, 1947 (1947 Act).

The Corporation argued that it should be exempt from the Act because some of its activities include construction, which is exempt under Section 7 of the Act. However, the Court found that the Corporation's activities were not exclusively construction-related and included various commercial activities such as buying and selling medical supplies, which generated profits. Therefore, the Corporation could not claim exemption from the Act.

The Court also considered whether the employees of the Corporation qualified as workmen under the Act. The Inspector of Labour had found that 53 workmen had been in continuous service for 480 days over 24 months, thus qualifying them for permanent status under Section 3 of the Act. The High Court affirmed this finding, and the Supreme Court saw no reason to overturn it.

2. Suggestion to Institute an 'Industrial Disputes Claim':

The second issue was whether the High Court, on remand, could ignore the Inspector of Labour's order and suggest that the employees raise an industrial dispute questioning their non-employment. The Supreme Court found that the High Court's remand was specifically to consider the applicability of the Act to the parties. Since the High Court concluded that the Act applied, it should have upheld the Inspector of Labour's order, which granted permanent status to the workmen. Suggesting that the employees raise an industrial dispute was deemed unjustified as it would force them to re-establish their claims unnecessarily.

Conclusion:

The Supreme Court dismissed the appeal filed by the Corporation and allowed the appeal filed by the respondent-Union. The Court held that the Act applied to the Corporation and its employees, and the order of the Inspector of Labour granting permanent status to the workmen should be complied with. The suggestion to institute an industrial dispute was deemed inappropriate given the prior orders of the Inspector of Labour. All pending applications were disposed of accordingly.