CORAMTHE HON’BLE MR. A.P.SHAH v. Taluk, Tiruchirapalli District

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 08.01.2007CORAMTHE HON’BLE MR. A.P.SHAH, CHIEF JUSTICEandTHE HON’BLE MR. JUSTICE K.CHANDRUW.A.Nos.1372 to 1375 of 2006---------W.A.No.1372 of 2006 V.Elayaperumal..Appellant.Vs.1. State Bank of India, Asaveerankudikadu Branch, R.S.Mathur (via) Ariyalur Taluk, Tiruchirapalli District. 2. State Bank of India, rep. by the Deputy General Manager, Personnel Section, Zonal Office, Tiruchirapalli. 3. The Inspector of Labour, Tiruchirapalli. ..Respondents.W.A.No.1373 of 2006 C.Rathinasamy..Appellant.Vs. 1. State Bank of India, Varadarajanpatti, Tiruchirapalli District.2. State Bank of India, rep. by the Deputy General Manager, Personnel Section, Zonal Office, Tiruchirapalli. 3. The Inspector of Labour, Tiruchirapalli. ..Respondents. https://hcservices.ecourts.gov.in/hcservices/ W.A.No.1374 of 2006 M.Selvam..Appellant. Vs. 1. State Bank of India, Ariyalur Branch, Tiruchirapalli District. 2. State Bank of India, rep. by the Deputy General Manager, Personnel Section, Zonal Office, Tiruchirapalli. 3. The Inspector of Labour, Tiruchirapalli. ..Respondents.W.A.No.1375 of 2006 B.Rengaraj..Appellant. Vs. 1. State Bank of India, Pudukottai Branch, Kizha Raja Veethi, Pudukottai District2. State Bank of India, rep. by the Deputy General Manager, Personnel Section, Zonal Office, Tiruchirapalli. 3. The Inspector of Labour, Tiruchirapalli. ..Respondents.PRAYER: Writ Appeals filed under Clause 15 of the LettersPatent, against the common order passed by the learned singleJudge dated 07.09.2006 made in W.P.Nos.17573 to 17576 of 1997. Petition filed under Article 226 of the Constitution of Indiapraying for issuance of writ of certiorari calling for therecords from the file of the Inspectors of Labour Tiruchirappalithe 1st Respondent herein and quash this order dated 31.01.1997made in RC NO, 20382/1995.------------ https://hcservices.ecourts.gov.in/hcservices/ For Appellants in All the Appeals:: Mr.N.G.R.Prasad For M/s.Row and Reddy For Respondents 1&2 in all the Appeals:: Mr.S.Jayaraman For 3rd Respondent in all the Appeals :: Mr.Raja Kalifulla, Govt. Pleader ------------ COMMON JUDGMENT (Judgment of the Court was delivered by The Hon’ble TheChief Justice) Admit. Heard learned counsel appearing for the parties. Byconsent, writ appeals are taken up for hearing. 2. Respondents 1and 2 are the State Bank of India and itsofficials. Respondent – 3 is the Inspector of Labour,Tiruchirapalli. It appears that during the period from 01.07.1975to 31.12.1987, the respondent Bank had engaged temporaryemployees in the subordinate cadres in its various branches dueto exigencies of circumstances and on account of urgent needs.The appellants were engaged as temporary sub-staff by therespondent Bank in various branches of the respondent Bank inTiruchirapalli zone during that period. The Federation of theBank Employees espoused the cause of the temporary employeesresulting in five separate settlements. As per the saidsettlements, the eligible temporary employees have to be selectedand wait listed as per number of days of service put in by themin the respective zone (module) wise; as and when vacanciesarise, it would be filled up from the wait list; all thevacancies to be identified upto 31.12.1994 were to be filled upfrom the wait list; the wait list was to remain in operation till31.03.1997 i.e., three years from the date of its preparation andthe wait list would lapse on 31.03.1997. It appears that theappellants applied for absorption as per the settlements but theywere not absorbed. According to the respondent Bank, as per thesettlements, a list of temporary employees was prepared and theworkmen who were on temporary employment have been included inthe list and as and when vacancies arose, candidates from thewait list were absorbed permanently in accordance with theseniority in the wait list and since all the vacancies arising on31.12.1994 are to be filled up from the wait list as per theseniority the claim of the appellants could not have beenconsidered. 3. Being aggrieved, the appellants approached the 3rdrespondent by filing applications under Section 3 of the TamilNadu Industrial Establishment (Conferment of Permanent Status toWorkmen) Act, 1981 (hereinafter for brevity’s sake referred to as“the Permanent Status Act”). The appellants inter aliacontended that they had been working in the respondent Bank’s https://hcservices.ecourts.gov.in/hcservices/ branches for more than 480 days in a period of 24 calendar monthsand thus, the appellants are entitled to permanency under thesaid Act on and from the date they had completed 480 days in aperiod of 24 calendar months with consequential benefits. Incontesting the claim of the appellants, the respondent Banksubmitted that the Bank is an establishment under the CentralGovernment and therefore, it is exempted from the provisions ofthe Tamil Nadu Shops and Establishments Act (hereinafter referredto “the Shops Act”) and consequently, the provisions of thePermanent Status Act would also not applicable to the respondentBank. It was contended that there is no necessity to seekexemption under Section 9 of the Permanent Status Act in view ofthe fact that there were existing settlements which relate toabsorption of temporary employees as permanent employees. 4. By order dated 31.01.1997 the 3rd respondent rejected thecontentions of the respondent Bank and held that though therespondent Bank is an establishment under the Central Governmentit does not cease to be an establishment for the purpose of thedefinition of the term “industrial establishment” under thePermanent Status Act. In this connection he placed reliance onthe decision of the learned single Judge of this Court reportedin Andhra Bank, Salem Vs. Inspector of Labour and Another (1994(1) LLN 501). He further held that in the absence of recordsproduced by the respondent Bank, the case of the workmen thatthey have put in more than 480 days of service has to be acceptedand taken as true, and consequently, the appellants are entitledto permanent status on and from 01.01.1993. 5. Against the order of the 3rd respondent the respondentBank preferred writ petitions which were heard and allowed by thelearned single Judge, relying upon the decision of the SupremeCourt in C.V.Raman Vs. Bank of India, (1998 (2) LLJ 423). Thelearned single Judge held that in view of Section 4(1)(c) of theShops Act the Nationalized Banks are exempted from the operationof that Act and therefore, the provisions of the PermanentStatus Act would also not apply to the Nationalised Banks, andtherefore, the workmen are not entitled to any relief. Thelearned single Judge noted that the decision of the Supreme Courtin C.V.Raman’s Case (supra) was not brought to the notice of thelearned single Judge of this Court. Moreover, as against thedecision of the learned single Judge in Andhra Bank’s Case(supra), writ appeal was preferred and a Division Bench of thisCourt has set aside the finding of the learned single Judgethough the issue of applicability of the Permanent Status Act wasexpressly left open.6. The short question that falls for our consideration is asto whether the Inspector of Labour had requisite jurisdictionunder the Permanent Status Act to entertain the claim petitionsof the workmen. In order to answer this question, it is necessaryto take into consideration the relevant provisions of thePermanent Status Act as well as the Shops Act. https://hcservices.ecourts.gov.in/hcservices/

7. Sub-section (1) of Section 3 of the Permanent Status Actdeals with conferment of permanent status of workmen and conferspermanency to every workman, who is in continuous service for aperiod of 480 days in a period of 24 calendar months in anindustrial establishment. The permanent status to such a workmanhas been conferred, notwithstanding anything contained in anyother law for the time being in force. From this, it is clearthat two pre-requisites are to be fulfilled for conferment ofpermanent status to the workmen viz., (1) he must be incontinuous service for a period of 480 days in a period of 24calendar months and (2) such period of service must have beenrendered in an industrial establishment. 8. Sub-section (3) of Section 2 of the Permanent Status Actdefines “industrial establishment” which reads as follows: “2. Definitions – in this Act, unless the contextotherwise requires – (3) “industrial establishment” means – (e) an establishment as defined in Cl.6 of Section2 of the Tamil Nadu Shops and Establishments Act, 1947(Tamil Nadu Act XXXVI of 1947……….” 9. From a mere perusal of the said clause, it is clear thatthe word “establishment” though not defined in it, has beendefined by borrowing from the Shops Act. Therefore, one mustrefer to the relevant provisions of the Shops Act to find out themeaning of “establishment” for the purpose of the PermanentStatus Act. 10. Sub-section (6) of Section 2 of the Shops Act defines“establishment” which reads as follows:- “2.Definitions:- In this Act, unless there isanything repugnant in the subject or context – (6) “establishment” means a shop, commercial,establishment, restaurant, eating house, residentialhotel, theatre or any place of public amusement orentertainment and includes such establishment as theState Government may by notification declare to be anestablishment for the purpose of this Act.” 11. The definition, as extracted above, means “commercialestablishment” besides other establishments, specificallyreferred to therein. “Commercial establishment” is again, inturn, defined in Sub-section (3) of Section 2 of the Shops Actand it runs as under:- “(3) ‘commercial establishment’ means anestablishment which is not a shop but which carries onthe business of advertising, commission, forwarding orcommercial agency or which is a clerical department ofa factory or industrial undertaking or which is aninsurance company, joint stock company, bank, broker’soffice or exchange and includes such otherestablishment as the State Government may bynotification declare to be commercial establishment forthe purpose of this Act.” https://hcservices.ecourts.gov.in/hcservices/

12. From a conjoint reading of Section 2(6) with 2(3) of theShops Act it is seen that the Bank comes within the field of‘commercial establishment’ included in ‘the establishment’falling under Clause (e) of Sub-section (3) of Section 2 of thePermanent Status Act. For the purpose of Permanent Status Act,the definition of an ‘establishment’ as defined in the Shops Acthad alone been borrowed and not the other provisions of the ShopsAct. In such a situation, once an ‘establishment’ falls withinthe definition of ‘establishment’ under Clause (e) of Sub-section(3) of Section 3 of the Permanent Status Act, the inevitableconclusion is that the provisions of the said Act are applicablein construing the conferment of permanent status to any workman,who fulfills the criteria as laid down under Sub-section (1) ofSection 3 thereof, notwithstanding anything contained in anyother law for the time being in force, unless and until theGovernment, invoking its power under Section 9 of the PermanentStatus Act exempts conditionally or unconditionally any employeror class of employers or any industrial establishments from theprovisions thereof. Therefore, once the establishment is definedin the Permanent Status Act by incorporating the definition ofestablishment in the Shops Act the definition so incorporated inPermanent Status Act become part and parcel of the later Act. 13. The law on the subject is well settled. When an earlierAct or certain of its provisions are incorporated become part andparcel of the later Act as if they had been bodily transposedinto it. The incorporation of an earlier Act into a later Act isa legislative device adopted for the sake of convenience in orderto avoid verbatim reproduction of the provisions of the earlierAct into the later. But this must be distinguished from areferential legislation which merely contains a reference or thecitation of the provisions of an earlier statute. In a case wherea statute is incorporated, by reference, into a second statute,the repeal of the first statute by a third does not affect thesecond. The later Act along with the incorporated provisions ofthe earlier Act constitute an independent legislation which isnot modified or repealed by a modification or repeal of theearlier Act. However, where in later Act there is a merereference to an earlier Act, the modification, repeal oramendment of the statute that is referred, will also have aneffect on the statute in which it is referred. It is equally wellsettled that the question whether a former statute is merelyreferred to or cited in a later statute, or whether it is whollyor partially incorporated therein, is a question of construction.14. In Re: Wood’s Estate, Ex parte, Works and BuildingsCommrs. (1986) 31 Ch D 607 at page 615 Lord Esher, M.R. observed:“If a subsequent Act brings into itself byreference some of the clauses of a former Act, thelegal effect of that, as has often been held, is towrite those sections into the new Act as if they hadbeen actually written in it with the pen, or printed init.” https://hcservices.ecourts.gov.in/hcservices/

15. In U.P. Avas Evam Vikas Parishad Vs. Jainul Islam (AIR1998 SC 1028) the Supreme Court has observed as follows:- “A subsequent legislation often marks a referenceto the earlier legislation so as to make the provisionsof the earlier legislation applicable to matterscovered by the later legislation. Such a legislationmay either be (i) a referential legislation whichmerely contains a reference to or the citation of theprovisions of the earlier statute; or (ii) alegislation by incorporation whereunder the provisionsof the earlier legislation to which reference is madeare incorporated into the later legislation byreference. If it is a referential legislation theprovisions of the earlier legislation to whichreference is made in the subsequent legislation wouldbe applicable as it stands on the date of applicationof such earlier legislation to matters referred to inthe subsequent legislation. In other words, anyamendment made in the earlier legislation after thedate of enactment of the subsequent legislation wouldalso be applicable. But if it is a legislation byincorporation the rule of construction is that repealof the earlier stature which is incorporated does notaffect operation of the subsequent statute in which ithas been incorporated. So also any amendment in thestatute which has been so incorporated that is madeafter the date of incorporation of such statute doesnot affect the subsequent statute in which it isincorporated and the provisions of the statute whichhave been incorporated would remain the same as theywere at the time of incorporation and the subsequentamendments are not be read in the subsequentlegislation.” 16. This is a reiteration of the principle as laid down byearlier judgments of the Supreme Court in a catena of decisionsincluding Mary Roy Vs. State of Kerala (1986 (2) SCC 209);Ramsarup Vs. Munshi (AIR 1963 SC 553: Ram Kripal Bhagat Vs. Stateof Bihar (AIR 1970 SC 951); Bolant Ores Ltd. Vs. State of Orissa(AIR 1975 SC 17); Mahindra and Mahindra Ltd. Vs. Union of India(AIR 1979 SC 798).17. In the instant case, the definition of establishment isvirtually lifted from the Shops Act and has been incorporated inthe Permanent Status Act. Therefore, the provisions of Clause (c)of Sub-Section (1) of Section 4 of the Shops Act which exempt theestablishments under the Central Government is of no consequenceand the Permanent Status Act would continue to apply for suchestablishments unless and until exemption has been obtained fromthe State Government under Section 9 of the Permanent Status Act.In C.V.Raman’s Case which was referred to by the learned singleJudge, the Court was concerned with the question as to whetherthe provisions of Shops Act would be applicable to theNationalised Bank in view of exemption granted under Section 4(1)(c). Therefore, the above decision has no relevance for the https://hcservices.ecourts.gov.in/hcservices/ determination of the issue involved in the present case.Consequently, we hold that the provisions of the Permanent StatusAct will apply to the Banks including Nationalised Banks. 18. In the light of foregoing discussion, the order of thelearned single Judge is set aside. The matter is remitted back tothe learned single Judge for deciding the issue of permanency inaccordance with law. In the circumstances of the case, thelearned single Judge is requested to decide the case asexpeditiously as possible, preferably within a period of threemonths from today. Accordingly, all the writ appeals are allowed.No costs. vbs/sm Sd/Asst.Registrar/true copy/Sub Asst.RegistrarCopy to:- 1. The Manager State Bank of India, Asaveerankudikadu Branch, R.S.Mathur (via) Ariyalur Taluk, Tiruchirapalli District. 2. The Deputy General Manager,State Bank of India, Personnel Section, Zonal Office, Tiruchirapalli. 3. The Inspector of Labour, Tiruchirapalli. 4. The Manager State Bank of India, Varadarajanpatti, Tiruchirapalli District. https://hcservices.ecourts.gov.in/hcservices/

5. The Manager State Bank of India, Ariyalur Branch, Tiruchirapalli District.6. The Manager State Bank of India, Pudukottai Branch, Kizha Raja Veethi, Pudukottai District7. The Section Officer,Appeal Filing Section,High Court, Madras8. The Section Officer,Writ Section, High CourtMadras+ one cc to M/s. Row and Reddy Advocate sr no. 1536+ one cc to Mr. S. Jayaraman, advocate sr no. 1999+ one cc to the Government Pleader sr no. 1558PV(cO)NM(12.03.07) W.A.Nos.1372 to 1375 of 2006.