High Court · 2009

IN THE HIGH COURT OF JUDICATURE AT MADRASDate:- 19.01.2009CoramThe Honourable Mr. Justice K. CHANDRUW.P. Nos.647 to 649 of 2000 The Management,Seyadu Beedi Company,Sindhupundurai,Tirunelveli – 627 001.... Petitioner in all W.Ps...Vs..1. The Appellate Authorityunder Payment of Gratuity Act, Office of the Deputy Commissioner of Labour, Tirunelveli – 627 002.2. Assistant Commissioner of Labour, (Controlling Authority under thePayment of Gratuity Act), Tirunelveli – 627 002. ... Respondents 1 and 2 in all W.Ps.T. Ulagammal ... 3rd respondent in W.P.No.647/2000Nallathai ... 3rd respondent in W.P.No.648/2000Meenakshi ... 3rd respondent in W.P.No.649/2000Petitions under Article 226 of The Constitution of India,praying to issue a writ of certiorari, to quash the order inP.G.A.Nos.31 of 1997(for WP.647/00), 33 of 1997(for WP.648/00) and 30 of1997(for WP.649/00) respectively dated 20.1.1998 passed by the firstrespondent.For Petitioner : Mr. R.S. RamanathanFor Respondents: Ms. Sneha, Government Advocate For R1 and R2 For RR3 No appearance.O R D E RThe petitioner, which is the Management of a Beedi Company andowns the trade mark "Seyadu Beedi", aggrieved by the common order passedby the first respondent in P.G. Appeal Nos.31/97, 33/97 and 30/97, havefiled the present writ petitions. https://hcservices.ecourts.gov.in/hcservices/

2. By the impugned order dated 20.1.1998, the AppellateAuthority had rejected the appeals filed by the petitioner-Managementunder the Payment of Gratuity Act, 1972 (hereinafter referred to as "PGAct") and confirmed the order passed by the second respondent-controlling Authority. The contesting respondents were working as beediworkers under one Shahul Hameed, who was originally had a branch atAmbasamudram and subsequently at Brammadesam. He was supplying rawmaterials such as tobacco, beedi leaves and labels to the contesting 3rdrespondents. Since their services were no longer required, they claimedgratuity in respect of the service rendered by them. Therefore, theyfiled an application before the controlling Authority, who is the secondrespondent. 3. The Controlling Authority rejected the stand of thepetitioner-Management that they are not liable to pay the gratuity andthat it was only Shahul Hameed as the supplier of raw materials, wasliable to pay the gratuity. Aggrieved by the said order, the petitionerfiled appeals under Section 7(7) of the PG Act before the firstrespondent. 4. During relevant point of time, the first respondent is theDeputy Commissioner of Labour of that area. Subsequently, in respect ofCoimbatore and Madurai zones, the Joint Commissioner of Labour was madeas the Appellate Authority under the PG Act by the State Government videG.O.Ms.No.101 Labour and Employment dated 10.7.1997. Therefore, thepetitioner claims to be under an impression that instead of the DeputyCommissioner of Labour, the matter will be heard by the JointCommissioner. On the contrary, the Deputy Commissioner, who is no longerthe appellate Authority, passed the impugned order and dismissed theappeals. As against the dismissal of these appeals, the present writpetitions have been filed.5. Mr. R.S. Ramanathan, learned counsel for the petitioner madetwo submissions. The order impugned in these writ petitions is passedwithout jurisdiction inasmuch as the Deputy Commissioner of Labour hadpassed the order and not the Joint Commissioner of Labour. But,however, a perusal of the Government order, notifying the JointCommissioner of Labour as appellate Authority, does not show it was maderetrospectively or the existing Deputy Commissioner of Labour will haveto transfer the pending appeals to the newly designated Authorities.6. In any event, the Supreme Court, in its decision relatingto the case of STATE OF PUNJAB v. LABOUR COURT, JULLUNDUR & othersreported in (1981- I L.L.J. 354), dealt with the power of the LabourCourt Vis a Vis the PG Act and held that the Gratuity Act is a speciallaw and therefore power under Section 33(C)(2) of the IndustrialDisputes Act available to the Labour Court cannot be invoked for thepurpose of claiming gratuity. Any aggrieved person will have to movethe Authorities under the PG Act, which is self contained Code. Afterholding so, in paragraph 11, it was held as follows:- https://hcservices.ecourts.gov.in/hcservices/ "11. At this stage, we put to the learned Solicitor-General, whoappeared for the State whether in the special circumstances it was notfair that the entire amount be paid by the appellant to the employeeswithout driving them to a separate proceeding. He has fairly statedthat the appellant is willing to do so and the sole object of thislitigation was to have the law clarified. We, therefore, direct theappellant to pay to the employee respondents within one month from todaythe amounts that may be due to them, if they have not already been paid."Further, in this case, the post of Deputy Commissioner of Labour wasupgraded into that of Joint Commissioner of Labour in the two cities andhence the notification will have no application to the facts of thepresent case. Even otherwise, this Court directed the petitioner toadvance arguments on the merits of the case, which was accordingly doneby the learned counsel for the petitioner. Therefore, the objectionregarding lack of jurisdiction need not be gone into in this case.7. Learned counsel submitted that inasmuch as Shahul Hameed isthe supplier of beedi leaves and other raw materials, he should be theemployer and the trade mark owner cannot be fastened with suchliabilities. Therefore, the order, directing the trade mark owners areliable to pay gratuity, should not be allowed to be on record. 8. In this context, it is necessary to refer the definition ofthe term "employer" found in The Beedi and Cigar Workers (Conditions ofEmployment) Act, 1966. Section 2(g) defines "Employer" as follows:-""employer" means ---(a) in relation to contract labour, theprincipal employer, and(b) in relation to other labour, the person,who has the ultimate control over the affairs of anyestablishment or who has, by reason of his advancingmoney, supplying goods or otherwise, a substantialinterest in the control of the affairs of anyestablishment, and includes any other person to whomthe affairs of the establishment are entrusted,whether such other person is called the managingagent, manager, superintendent or by any other name"Before the enactment of the Beedi and Cigar Workers (Conditions ofEmployment) Act, 1966 the beedi owners through paper arrangements wereavoiding statutory payments. Therefore the Parliament thought thatthere should be a special law dealing with Beedi and Cigar Workers andenacted the law. Unlike other enactments, section 2(g) has defined theterm "employer" in a wider angle. The purpose of making such definitionwas to hold that the trade mark owner as the ultimate Authority to paygratuity and other amounts. When the constitutional validity of the https://hcservices.ecourts.gov.in/hcservices/ provision was also challenged, the Supreme Court has upheld the samevide its decision reported in the case of MANGALORE GANESH BEEDI WORKSAND OTHERS v. UNION OF INDIA AND OTHERS (A.I.R. 1974 SUPREME COURT1832). 9. When a similar contention was raised before this Court inthe decision reported in the case of DHAKSHINAMURTHY, S. v. DEPUTYCOMMISSIONER OF LABOUR (APPEALS), APPELLATE AUTHORITY UNDER THE PAYMENTOF GRATUITY ACT, CHENNAI AND OTHERS (2003-I-LLJ 32), P.K. MISRA, J.,rejected the contention that trade mark owner cannot be held liable.Reliance was placed upon the definition of term "employer" as found inSection 2(g) of the Beedi and Cigar Workers (Conditions of Employment)Act, 1966 and also the decision of the Supreme Court in A.I.R. 1974SUPREME COURT 1832 (cited supra),. Therefore, the contention of thelearned counsel for the petitioner that the trade mark owners is not theemployer cannot be countenanced by this Court. 10. Learned Government Pleader also brought to the notice ofthis Court a communication sent by the first respondent dated 3.4.2000,stating that in the absence of an interim order, the amounts depositedhave been paid to the contesting respondents. In the light of theabove, the writ petitions are misconceived and the same are dismissed.No costs.Sd/-Asst. Registrar./true copy/Sub Asst. Registrar.ssa.To1. The Appellate Authorityunder Payment of Gratuity Act, Office of the Deputy Commissioner of Labour, Tirunelveli – 627 002.2. The Assistant Commissioner of Labour, (Controlling Authority under thePayment of Gratuity Act), Tirunelveli – 627 002.+ 1 CC to Mr.R.S.Ramanathan, Advocate SR.NO.1618+ 1 CC to Government Pleader,SR.NO.2230 to 2232W.P. No.647 to 649 of 2000 DM(CO)EM/30.1.09