S.C~R .. SUPREllIE COURT REPORTS· v. THE PUNJAB NATIONAL BANK LTD.· ·

The facts leading up to this appeal may shortly be stated. The appellant started his service as the head cashier in the Una Branch of the Bank on the 18th June 1949. The Cash Department of the Bank is in charge of Treasurers. The relation between the Bank and the Treasurers . is evidenced by ail agreement d3ted the 1st May 1944 (Ex. 1) which will be noticed · detail hereinafter~ That · was an agreertrent ·between the Bank ··'and · "Messrs Rai Bahadur Karam ' Chand Puri & Bros". That firm was appointed the Tr.casurers at the head office .of the Bank -and other places iri and outside the Punjah. On the 28th Septemhcr-1951 District Manager of the Northern Circle of the Bank the· · Treasurers bforming wrote a letter (Ex. 4) .• v' - -' I 1955 Shirml ur!rm Shmmn '\(· The Punjab ~ational B. nk Ltd .. Sinhr .:I ... l S.C.R .. SUPREME COURT· REPORTS: 1429 a intimated by .the cause of them that · it had been decided · to close the Una office of the B,mk with effect from the dose ot business on In pursuance of that letter the 3rd November 1951. letter . dated 2nd the Treasurers October 1951 enclosing a copy of Ex. 4 to the . appel lant that the l.Tna Branch of the Bank will .cea~e to function .from the close of business on the 3rd Novem that . his services will not · be required ber 1951 and that date. The Punjab National Bank Em ployees' Union (P_unjab) took .. up appellant . as .also that of .other employees . and made representations . The India by a notification No. SR0-432 Government of dated the 8th March 1952 published in the Gazette of India, Part II-Sec .. 3, in exercise of !ts .powers _under section 10 of the Industrial Disputes Act XIV of 1947 the Act) referred . the . industrial (hereinafter called its workmen named dispute between . the Bank and in . schedule : 2. (concerning . workers dismissed) schedule 3 (relating to workers ·transferred) for adju to the ·Industrial Tribunal at Calcutta con_. dication stituted under section 7 of the Act. Schedule 1 in so far as it is necessary for purposes of this .case contains the following points of disp1Jte between the ·employer and the workmen :.....::. the Government of India. . . . . "L . Wrongful dismissal of .workmen men tioned iii. schedule II and their reinstatement. "2. In .the event· of any order for reinstatement payment of wages and other allowances from the date of dismissal to the date of reinstatement" .. The appellant is No. 5 in schedule 2 aforesaid. The Tribunal gave its ·award on the 13th October 1952 in respect of a number of employees whose . cases were It is only necessary actually .in controversy before it. to refer to the award in so far as it concerned appellant. · ·After overruling the preliminary objec• tion of ·the Bank .that the Union had no locus standi to represent the Tribunal' formulated the · appellant the· following point for its decision :- . "On merits the- main ·point . involved . is . as· . to whether the services of an cmployey of ... the Cash .. ·Nati<mazBankI.td •. · Ch . f9ss Shi'flnandais Sharma 1430 : SUPREl\IE.COUR'f REPORTS [1955] Departnien t can be terinliia ted on a change made in .the services ofthe·Contractor Cashier". ' 'It answered this point in these words:- •: - v. . . Sinha J; _ _ . an n una . f I d I (P N B . k d" .: "This point has been agitated in more than one The Punjab - case and I have also held in Reference No. 3 of 1951 t . 1 T "b · as _ airman o n us na is- pute) relating to 5 cashiers that the employees of the .--- Cash Department are the employees of the Bank and ·not the. nominees of the Contractor Cashiers so far service conditions are concerned, and I think it will serve no useful purpose to discuss all the legal prece ·dents cited, more especially when the point has been .set at rest by their Lordships of. the Supreme Court in Civil Appeal No. 66 of 1952 in tlie matter of United .Commercial Bank Ltd. v. Secretary, U. P. Bank Em ployees' Union and Others. I am of the· opinion that the dismissal of Shi-i Sharma was wrongful and liable to be set aside.·· Now the normal remedy is reinstate ment and I have no h·esitation in allowing the same: He will also be paid his back salary and allO\".ance from the date of dismissal to the date of reinstate 'ment". •-. \Vhatever may be the merits of the answer given • to the question propounded by the Tribunal, there is no doubt that the question posed had been wrongly ·framed. The· discharge' or dismissal of the appellant had nothing to do with the change in the personnel of- the Treasurers. The appellant's services were dis pensed with on the ground that the Una Branch where he was employed as head cashier being an un .ecc;momic unit had to be closed and that therefore the ,appellant's services_were no more required.. TJ.ic rcs .pondent's case appears to have been. that the firm known as l\Iessrs R. B. Karam Chand Puri & Bros . . have been contractors for the Cash Department of the _Bank at the head office and some of the other offices in the Punjab and beyond; that from time to tim.e agreements were executed between the Bank and the aforesaid firm; that the last agreement was executed on the 1st l\Iay 1954 (Ex. I); that . the appellant .according to the respondent-Bank was the nominee of the said firm, and that his services had been dispensed ·1955 s· ivnandan Sharma v. 1"he Punjab ~Y ~tional Ba_nk Ltdi s_inha J. 1432 SUP-REME CQUR'F REPORTS [1.955] award: hy the .Tribunal was,. in the. result, set:::aside , and the .Bank?s appeal ._allowed.,• , . , , ; · ·The appellant · in "this: Court- through his • counsel Shri 'Chari,- argued· that' the Appellate Tribunal ·had misinter-preted ·provisions of the. Industtial Dis putes -Act in coming, to the conclusion that the Tribu nal ·had no- jurisdiction to entertain the-dispute simply, on the . ground that one of the parties to the: dispute had· successfully denied .. the relationship; of : employer and employee; "that· the· Appellate · Tribunal miscon ceived its ·functions- - by ·basing· its ; findings: .on the: :written · agreement . between· the interpretation of Bank and · its· Treasurers ;when - it :should. have ·gone inro all the relevant .facts to -·determine the · substance oi. the· matter; -and finally; :rhat: the Appellate ·Tribu nal mlsdiretted. itself on<the question of· the interpre tation of the agreement for coming : to the conclusion that the appellant was not· :an employee ·of the Bank but was a ·nom'inee' of'· the "Treasurers"; ·It' was· further argued on behalf·· of -the 'appellant tliat •the :Tribunal having ·based • its dicisicin on its ' previous award dated the ·16th· ·September . 1952 in Reference ·No ... 3 ·of 1951 between' •persons 'IIlOre or less - in· the same .. position ·as the respondent-Bank, . 'in ·the ·back the•• appellant•· and ground· of the decision·• of ·the previous Tribunals,· e.g., the· award' ' of the Conciliation Board preside-cl over by Mr. Justice ' Bind Basni· Prasad of the Allahabad High Court,· the award- by the Tribunal presided over by Mr. K, · C. Sen. and the award of the All India Ii:tdus trial Tribunal . (Bank Disputes);• presided over by Sri S. Panchapagesa Sastri and the award dated the 24th March 1951 · in Reference No: 20, Tribuna} was ·really the award · of · the Tribunal was . based: on considera tions · :of· facts ' and · · c'ircurnstarices disclosed · ·in earlier awards·· to: which the ·Bank and': its cashiers· and other employees : employed· ·in the Cash Department were parties:· ·It was· thus a •final finding of fact which was not ·open 'to appeal.:before the Appellate· Tribunal. therefore contended' that the Appellate Tribu It. was the appeal . and . to nal had no jurisdiction to etitertain reverse the award of the Tribunal. final: The -argument was the award of "' - - • 1955 Shivnandarr Sharma v. The Punjab National Bank [,t,/ Sinha J. S.C.R. SUPREME COURT REPORTS· 1433 it was On behalf of the respondent-Bank it was contended that no specific grounds had been taken either before the Appellate Tribunal or ·in the memorandum of appeal to this Court that the Appellate Tribunal had no jurisdiction on the ground now taken ·by the appel lant in this Court, nor was that ground taken in statement of case. On merits .contended by the· respondent's· counsel that the Tribunal is as much bound ·by the rules of evidence and procedure as any other Tribunal and as the Tribunal had not addressed itself to the cashier-appellant was an employee · of the Bank, the question was open competent before to pronounce -on it was · argued that on a true construction of the provisions of the agreement (Ex. I) this Court should accept the the appellant finding of the Appellate Tribunal was not an employee of the Bank and that · on that account· the ·Tribunal had no jurisdiction to grant ahy relief to· the . appellant. . · · the Appellate Tribunal which was that basic· question. Finally the question whether to· the terms of respondent argued On behalf of the ·respondent the case was practically rested on the construction of· the agreement (Ex. 1). With ·reference the agreement . the that the learned counsel for Treasurers . were not servants or employees of "independent contractors" and Bank but were the appellant and other employees in the Cash Depart ment having been nominees . of the "independent con tractors", there could not be any relation of employer and employee ·between the Bank and the appellant. It is therefore necessary to examine in some detail the terms of the agreement aforesaid. We set out below, underlining important words, the terms of the agree they are relevant for the determina ment in so far as tion of the true relation between · Treasurers. Though this agreement is dated the 1st May 1944, cl. (1) provides that it will be deemed to have commenced and come into force from the 15th March 1942, the · date of the death of R. B. Karam the previous Chand Puri and will take the place of thus maintain. agreement · dated ing the .continuity of relationship between the 26th July 1941, the Bank and - - I ; • "J T. J' t9ss 1434 The Punjab [1955) Shivnandan Sharma SUPREl\IE.COURT REPORTS ' - Bank and the Tr!lasurers'. The·agreement provides that the Tceasurers.sbal.l diligently and 'aith'ully serve the Bank at the Head Office and its various offices mentioned in schedule A attached to and forming part of the agreement and at 9ther offices where they may NationalBankUa. hereafter be appointed treasurers and shall in all res- . Si,.haJ. _ pects diligently and faithfully obey and observe all law ful orders and instructions of_tbe Bank or the person placed by the Bank in authority over them in rela~ tion to the due discharge of their duties as Treasurers. The Treasurers in addition to the duties, liabilities and responsibilities devolving upon them by virtue of · the provisions oftbe agreement shall also be liable to perform such duties and discharge such responsibili~ ties as by custom usually devolve on treasurers in the employ of a bank._ The Treasurers shall be -paid_ ·for their services a remuneration as µientioned in schedule A aforesaid or such remuneration as the General · Board of Directors of the Bank may de'termine from time to time. Out of the remuneration paid to tbeni by the Bank the Treasurers shall pay salaries to their nomi nees employed by them for performing the duties of. a cashier in the Bank on their behalf or other func tionaries of a similar nature. The salaries of such nomi nees employed by them will be fixed by the Treasurers themselves but the same will be subjeet to the approval of th·e Bank. The remuneration of the Treasurers will-.. be tbenet amount which will-be left to them after pay ing salaries to their nominees employed by · them for working as cashiers, etc. ·The Treasurers themselves will not be entitled to any kind of allowances besides ·the net remuneration as aforesaid but their nominees or working cashiers will be entitled to allowances which the authorities of the Bank may sanction for members of · . the staff from (ime to time. The Treasurers - shall em ploy the number of men at each office as ·mentioned iri schedule A.aforesaid. The Board of Directors shall have the power to increase or decrease the number of their nominees for any particular office and the amount of rem unera ti on fixed for that office. The Trea- . surers.' shall be responsible for the due safety, both within and outside the premises of the B:mk at any • • ~9li5 .. Shivnandan .ShlJTfllfl ·V. T:he Pu,Yab .Jlofltional Bank J. td, Sinha J. s:c.R. :SUPREME •COURTiREP,OR'fS . 1435 .negligence .misappropriation embezzlement by .or misconduct · of three calendar months' notice :Office pfacoo 1:t!llde;r their charge, of' all mOfley, , •specie, ornaments, .. bullion, •cash, etc. :and ";cif other ~aluable documents received by them for :arid . on behalf. of the Bank .or from the 'Bank and shall be answerable to the Bank for all fosses occurring · either inadvertently or :by or through the Treasurers . or :any of their nominees .. The Treasurers shall be entitled to resign the services of the Bank by the Bank. •giving The Bank shall also be ·entitled to dispense with the Treasurers' .services on giving three . months' notice. In case of gross :negligence or misconduct or of any fraud, Treasurers or any of the nominees in the discharge of .their duties as ·such Treasurers, no notice shall be necessary and the Bank shall have the right to dispense with their services forthwith. The Bank shall have right to take the Treasurers into the servioe of the Bank after settlement of remuneration with :the Treasurers at any other ·office or offices of the Bank. The Treasurers ·and their nominees shall obey all the orders, rules and .regulations prescribed by the Ban•k with regard to the discharge of their duties by the cashiers :as well as with regard to the amount of balance they are allow ed to keep with cashiers to inform the manager of the Bank as soon as .the balance in hand exceeds .and to ask for orders on the point. 'The Treasurers · shall not engage any person as their assistant or peon about whose manager of the Board of Directors of the Bank may . have any objection. The Treasurers shall also arrange that no person under employment absents himself from duty withol.lt the written permission of .the man ager . for the absent without objection of. the ,Board or the . Manag~r, the Treasurers shall. forth'Yith . app9int a ·in his place. The Treasurers shall be for.:. the .1 acts and defaµlts all . their . n0mi1,1ees. The .. Treas urers and ,thefr nominees .. shall be.·:entitled to ·travelling ,Board allotJ!ancf] .according to . .rates. s~<;tioned .,py It shall be the duty .of substitute responsible character, conduct ·turned out on leave, or , he is such employee the prescribed time being. reliability If any .them. ·the .of ·or 1955 Shivnandan Sharma "· The Pury'iih National Bank Ltd. Sinha ]. 1436 SUPREME COURT REPORTS [1955] their nominees, the Bank and the Treasurers, of Directors of' the Bank. The Treasurers_ have de . posited security of the value of Rs. 15,000/- on which they shall be entitled ·to receive interest at the rate of · 3! per cent. per annum. As a further security terms and .conditions of the ·due performance of agreement as - a cover for loss that may be caused the Bank by. any act or omission of themselves or any the Treasurers hypothecated one of properties as per . schedule C attached . to and forming part of the agreement. Schedule A aforesaid contains the names of the offices, the monthly remuneration of in respect of each one of those offices the Treasurers separately, net savings of the Treasurers after paying the salaries of total number of · men . including cashiers, etc., as stated against each one of the offices. Apart from the · terms set out· above bearing on the relation between the · follow of which apply equally to their nominees, ing terms of the agreement bear directly on the the nominees of the Treasurers, · like the tion between In this connection the · agree appellant, and the Bank. that the Board of Directors shall have ment provides the power the number of Treasurers' nominees for any particular office and that office. Such amount of nominees shall be entitled as servants of the Bank any bonus which may from time to time be declared the amount of their Treasurers shall · be own net remuneration and no further. They shall not be entitled to any bonus · to which their cashiers are not eligible under the rules of the Bank. The nomi nees of the Treasurers shall be entitled to participate as ordinary members of the staff in ·the provident the Bank. Such nominees shall also constituted by be entitled to rates sanctioned by the Board of Directors of the Bank required to go to out-stations on whenever bank business. to travelling allowance according the staff. The bonus of to increase or decrease the members of remuneration they are limited From the terms of the agreement. aforesaid set out above almost such clauses and words as 'are not relevant· to this case, it will appear verbatim omitting \ ·•

195.S Shivnandan Sharma v. The Punjab National Bank Ltd. Sinha J. -1, J. S.C.R. SUPREME COURT REPORTS 1437 the assistants. to them as their terminated it in accordance with that the Treasurers are under the employment of the Bank on a monthly basis for an indefinite term, that is to say, until such time as either party to the agree quoted above. They are under the complete control and direction of the Bank through its manager or other functionaries. The Treasurers have to take their orders from day to day as regards the cash balance or other cognate matters relating to the safe custody of cash, valuable documents, etc. belonging to the Bank or its constituents. The Treasurers receive in respect of each office under their charge a certain named sum out of which they have to pay the salary of a stated number of their assistants who may be head cashiers or cashiers or assistant cashiers and other such func to receive bonus on the tionaries. They are entitled net amount secured remuneration, being the lump sum fixed in respect of each office, minus the salary of It is these Treasur~rs are not and cannot be expected to be personally present their onerous duties at each one of the large number of offices spread over to be the Punjab and outside. Naturally they had authorized to engage head cashiers, cashiers, or assist ant cashiers in respect of each of the offices placed in their charge. They had to guarantee the fidelity of assistants. Those the persons so reliability, in whose assistants had honesty and efficiency both the Bank and the Trea surers had confidence. The Treasurers have the right to nominate final words in the choice. The Bank Manager has complete control over such nominees in the matter of leave of absence, discipline and conduct in the dis charge of their duties as assistants managing the cash and other valuables in the custody of the Bank. From the very nature of things it had to be a dual control in the sense that the Treasurers had to nominate the assistants who responsible to discharge functions in connection with cash and other valuables of the Bank and the Bank could not abdicate its powers of full control over the day to day working ot employed as to be persons those assistants but the Bank had to discharge 17-90 S. C. India/59 1955 Shiunandatt Sharma v. The Punjab Jfational Bank Ltd. I Sinh~ ]. 1438 SUPREME COURT REPORTS [1955] the Cash Department. The nominees of the Treas urers are treated on the same footing as the other ser vants of the Bank in the matter of bonus, travelling It is true those allowanc.e and provident fund, nominees are. to be paid by the Treasurers but it is out of the. money provided by the Bank. etc. independent It is not always. easy to determine.whether the rela tion between two parties, in the present case of the Treasurers vis-a-vis the Bank, is that ' of · servants a master or of contractors who have undertaken to do a particular job for their employer. The question has generally arisen in connection with the determination of vicarious liability of ployer in respect of .acts done by his agent (using a neutral word which includes an independent· ·contrac tor as also a servant). The distinction between a ser vant and an subject matter of a large volume of case-law torts have attempted tests. For example, in some general Pollock's Law. of Torts,*. the distinction has been brought out: independent contractor has been lay down text-book writers on .._, "A master is one who not only prescribes to the workman the end of his work, but directs or at any moip.ent may direct the means also, or, as it has been put, 'retains the power · of controlling the work', a servant is a person subject to the command of his master as to the manner in which he shall do his work .... An independent contractor is one who undertakes to produce a given result but so that in the actual execution of the work he :is not under the order or control ·of the person for whom he does it, and may use his own discretion in things not specified before- hand ................ ". Clerk & Lindsell on Torts (11th Edn.) at p. 135 independent contractor given by Pollock as quoted above. the description of adopted In the 11th Edn. of Salmond's Treatise on the Law the same distinction has been clearly indi of Torts, cated in the following passage· a~ p. 98:- - *Pages 62 & 63 of Pollock on Torts, 15th Edn. 1955 Shivnandan Sharma v. The Punjab National Bank Ltd. Sinha ]. S.C.R. SUPREME COURT REPORTS 1439 IS .over "What then, . is the existence of a right of control the test of . this distinction bet ween a . servant and an independent . contractor? The agent m respect of the manner in which· his work is to be .done. A . servant is an agent who works under the supervision and direction of his employer; an in IS his own master. dependent contractor IS one who A servant to obey his em a person engaged independent ployer's 9rders contractor is ·a person engaged to do certain work, but to exercise his own discretion as to the mode and time of doing it-he IS bound by his contract, but not by his employer's orders". time to time; an IS indicating to determine those distinctions, Those learned authors have discussed m great detail cases illustrative of circumstances in which the general rule has been· ap plied to individual cases with such modifications as the facts and circumstances of a particular case quired. We are here not concerned with those mce distinctions which have been drawn m connection with the rule of vicanous liability in torts. We are here concerned only with the question how far laid down by the standard authors as'· quoted above can be applied the present con troversy whether the Treasurers of the Bank were servants as contended on behalf of the appellant or independent contractors as claimed on behalf of the respondent-Bank. The agreement between the parties, as summarised above, transaction con stituting the Treasurers agents of the Bank, the former agreemg lo~s occasioned to the Bank due to the lack of fidelity and efficiency of charge of the Bank's cash and valuable documents. The Treasurers have been charged with the duty of nominating their assistants who are to be responsible m their day to day work to the Bank which all the time has full control over them in the matter of their leave of absence, as they shall keep the cash and other valuables and as to how they shall be under the general direc~ion of the ·Bank's manager or some staff entrusted with IS a composite the ministerial against any indemnify to how latter - ) Shiv1Uf1J.{/O.n Sha,.ma v. The Punjab. National Bank Ltd. Sinha J. 1440 SUPREME COURT REPORTS [1955] functionary who may be nominated by Bank to supervise the work of the Cash Department. the employees The Bank makes itself answerable the concur thus appointed by the Treasurers with nonce of the Bank for their bonus, provident fund and travelling allowance. For those purposes these assist ants are to be on the same footing as the other em ployees of the Bank. - - ' ·- already responsibility in charge of to be approved by the absolute power of independent contractors. the Cash Department of It was contended on behalf of the respondent Bank that its agreement with the Treasurers shows that the latter had the fullest the appoint ment and dismissal and payment of salary of the em ployees Bank and that therefore the Treasurers could not but It has noticed the appointment of such assistants as are entrusted with the work· of the Cash Department the Treasurers. is not under The appointment has the Bank the Treasurers cannot continue to employ those the Bank workmen in whose fidelity and efficiency has no confidence. Hence both in the matter of appointment and dismissal of the employees the Bank reserves to itself the power to give direction Treasurers. Similarly in the payment of salary the money comes out o.f the coffers of the the hand of the Bank, though it was contended on Treasurers. In behal£ of the appellant that payment of salary of the is made ·through employees in the Cash Department the Bank itself but we have no this case beyond the bare assl!rtiOn at the Bar. But, in our opinion, the situation in respect of the appoint ment, dismissal and payment of salary of the emplo yees of the Cash Department is analogous to that of the employees of a particular department of Govern ment, in which appointment and dismissal of minis terial staff may rest with an authority so empowered the department. Payment of salary the appointing authority but may also be made by the money comes out of the Government treasury. In those Circumstances, can it may be paid by this connection it be rightly asserted tangible evidence the matter of the head of 1955 Shivnandan Sharma v. The !'u,Yab National Bank Ltd. Sinha J. S.C.R. SUPREME COURT REPORTS 1441 IS those employees are not the servants of Government? The analogy may not be perfect, because, in the pre sent case, the appointment and dismissal of the em joint respon ployees of the Cash Department It has got sibility of the Bank and its Treasurers. the Treasurers are the guarantors of to be so because the fidelity and efficiency of the employees and the day Bank has to exercise complete control over to day discharge of their functions because Bank which is vitally and immediately concerned with the efficient and honest discharge of the duties of the assistants in ning of which is the most important of a bank's func tions. the Cash Department, the efficient Is their day the Treasurers or Is no specific provision It will further be noticed with reference to that whereas terms of the agreement set out above the Treasurers and their nominees have to take their orders from the Bank Manager or other such func tionary, to day functions nommees shall discharge under the direct control of they will be subject to the immediate control of the Treasurers m the discharge of their daily duties and in the matter of the grant of leave of absence. There rnuld not be such a provision, as a dual control of that kind in the daily work of the employees would lead to a great deal of confusion and lack of disci pline amongst staff. The employees of the Cash Departmen~ have of necessity to be under the direct· control of the Bank Manager or of some ::>ther functionary appointed by the Bank. Bank which has undertaken the responsibility m the service and matter of their pay and prospects m employees, even as other naturally employees of the Bank, have - to take their orders from the Bank. It ·must therefore be held that the Treas the servants of the Bank and urers are nominees must equally be so. the ministerial therefore, It The Appellate Tribunal held that on a reading as the Treasurers and itself pointedly ~ whole of the clauses of the agreement aforesaid appellant was an employee· of not of the Bank. It did not address - - ·• ) 1955 Shivnandtu1 Sharma v. The Punjab ·National Bank Ltd. Sinha -J. 1442 SUPREME COURT REPORTS [1955) the exact to · what was the Bank and the question as the ministerial · staff of the ultimate employer would be the employees· in the Bank. the •Treasurers. the question as tO· ·what would · be i:o relation between It did not also consider position of ' the employees ·of the· Cash·· Department vis-a-vis the Bank if it were ·held that the Treasurers themselves · were the servants : of the Bank and . not independent contractors. Before the ·Appellate· Tri to· have. concentrated their bunal 'both parties appear attention · on the question ·as to whether the emplo yees of the Cash·· 'Department were . servants . of" the Bank or· of the· Treasurers. In our opinion,. that was not a correct approach· to·. the · determination of ·the parties. ·. If the · Treasurers' controversy between relation to the Bank was that of servants to a master, simply because ·the servants were authorized to· ap the Cash point and dismiss Department would not make In· that Cash Department independent· of sittiation the· Bank through the agency of 'the Treasurers. jt was ·argued on' behalf of 'the· respondent that even if it were held the servants of: the. Bank that ··the Treasurers· were and . not independent contractcirs; the. legal position of the· employees of the Cash Department · vis-a-vis the Bank would be the same;· namely, · that they will· be in·· law the :servants of the Treasurers. In our opinion, .If . a master there is no · substance 'in that contention. employs' a servant and authorizes him to employ- a number· ·of persons job and guarantee their fidelity and efficiency for· ·a Tash con sideration, the employees· thus· appointed by .the .. ser vant 'Wou!O'·be··equal!y·•with the employer;: servants of 'It is ·not -always correct to· say ·that· per the· master. sons appointed and liable to· be dismissed: by : an· in· dependent contractor can -in· no ·circumstances •be . the employees of· ·the third· party. This would be ·· clear from the following observations· of Lord · Esher, M.R., in the case of Donovan v. Laing,·' Wharton & -Down Construction Syndicate(1 to do · a particular ) :~ , ,. . . . . . "It· -is . true that .the defendants,. selected the man and paid·his.wages; and these· are .circumstances which, if .nothing •else intervened;• would- be·.strong'·to. show (1) [18~3] t n. B. D629 at 632. - - 1955 Shivnatrdan Sharma v. The Punjab· National Bank Ltd. Sinha :J. S.C.R. SUPREME COURT REPORTS 1443 thei.r orders, the man misconducting. himself that he. was the servant of the defendants. ·So; indeed, he was as to a great many things; but as to the working of the crane he was no longer their servant, but bound to work ·under the orders of Jones & Co., and, if they in working the crane or disobeying they would . have a right to discharge him from that employment?'. latest Those observations have 'been · approved in decision of the House of Lords in the case of Mersey Docks & Harbour Board v. Goggins & Griffith (Liver pool) Ltd.(1). The House of Lords distingllished that the general ruling on facts but did not depart from rule laid down in the earlier decision that the deter minative factor is as to which party had control . over the workers·· as to how they would do · their job from to day. Lord Macmillan in his speech at p. 14 · has observed as follows :- to your Lord ships but ·where, as all agree, the question in each case in other its own circumstances, decisions turns on than determinative. So cases are to formulate a cri far as attempts have been made terio:1 of general application, it cannot be said that these attempts have been very successful". "Many reported cases were cited illustrative rather It would thus appear that the question 4s to whose employee a particular person was has to be deter to the facts and circumstances mined with reference of each individual ·case. . Lord Porter in the course of in the reported case (supra) at p. 17 has his speech observed as follows :- "Many factors have a bearing on the result. . Who is paymaster, who can dismiss, how the alterna tive service lasts, what machinery is employed, have all to be kepf in mind. The expressions used in any individual case must always be considered in regard the subject matter under discussion but amongst the many·· tests suggested I . -think that . the most satis factory,· by which to ascertain who is the employer at any particular time, is to ask who the _employee th.e way upon which he is engaged" .. in which he is to do the· work is entitled to tell · (1) [1947] A.C. I, 1955 ~ Shivnandan S!iafrrid v. Ti,, Punjqb National Bahk l.Jd. Sinha J. 1955 March 15 1444 SUPREME COURT REPORTS (1955f through the Bank As indicated above, in the present case the direc tion and control of the appellant and of the minis terial staif in charge of the Cash Department of the Bank was entirely vested manager or other superior officer. We have therefore no hesitation in differing from the conclusion arrived at by the Appellate Tribunal and in holding that the appellant was an employee of the Bank. That being so, to make the appellant. The directions the proceedings respondent did not at any stage of its merits. challenge· the orders of That conclusion being reached, there is no difficulty in upholding the orders of the Tribunal in respect of to pro the appellant, the parties. nounce upon the other points raised by The throughout. the Tribunal had it did therefore not necessary the Tribunal on the jurisdiction allowed with in respect of accordingly appeal It is 1s Appeal allowed. BHIM SEN ti. THE STATE OF U.P. [VIVIAN BosE, JAGANNADHADAs and SINHA JJ. J U. P. Panchayat Raj Act, 1947 (U. P. Act XXVI of 1947), ss. 49 (1)(2)(4), 52, 55-Rule 84 framed by Stat< Government-Thef' of the value of Rs. J..().0_ committed by three accused-One of the accused belonging to Madhya Pradesh State-Panchayat Ada/at constituted under the provisions of s. 49 of the Act and Rule 84 framed there· under to try the present case-Whether could be properly constituted -Rule 84-W hether Intra vires-/urisdiction of ordinary courts JJ/hether excluded-Bar under s. 55---Scope of. Three accused were c.onvicted by a Magistrate under s. 379 of the Indian Penal Code of the offence of the value of Rs. 3 and sentenced to a fine 0£ . Rs. 25 /- each. The question for determination was whether t~e case should have been tried by a Panchayat Ada:lat cortstituted under the U. P. PanchaYat Raj Act, 1947 and the Magistrate had no jurisdiction to try it. Two of the accused belonged to U.P. State and the third belonged to Madhya Pradesh State. theft of Section 52( I) of the Act provides that certain specified offences (including the offence of theft when the value of stolen property does -