The Honourable Mr v. The Special Deputy Commissioner of Labour (Appeals)

In the High Court of Judicature at MadrasDated: 30.11.2007Coram:The Honourable Mr.Justice K.ChandruW.P.No.35943 of 2007& M.P.No.1 of 2007Videsh Sanchar Nigam Limited,4, Swami Sivananda Salai,Chennai-600 002,Rep. by its General Manager Mr.K.Prakash.. Petitionervs.1. The Special Deputy Commissioner of Labour (Appeals), Authority under Section 41 of the Tamil Nadu Shops & Establishments Act, 1947 DMS Compound, Chennai-600 006.2. Commissioner of Labour, Authority under Section 51 of the Tamil Nadu Shops & Establishments Act, 1947, DMS Compound, Chennai-600 006.3. S.Gajendran .. RespondentsWrit Petition filed under Article 226 of the Constitution of India,praying for issuance of a Writ of Mandamus, directing the first respondentto defer all further proceedings in TSE.No.18 of 2007, till the secondrespondent decides the application in T.N.S.E.No.2 of 2007.For petitioner : Mr.Vijayan for M/s.King & Patridge For respondents 1 & 2 : Mrs.Bhavani Subbarayan, Addl.G.P.OrderHeard the arguments of Mr.Vijayan, learned counsel representingM/s.King and Patridge, for the petitioner-VSNL and Mrs.Bhavani Subbarayan,learned Additional Government Pleader taking notice on behalf ofrespondents 1 and 2 and have perused the records. https://hcservices.ecourts.gov.in/hcservices/

2. The prayer of the Writ Petitioner-Videsh Sanchar Nigam Limited(for shot, VSNL), is to prevent the appeal filed by the third respondentwhich was numbered as TSE.Case No.18 of 2007, pending before the firstrespondent-The Special Deputy Commissioner of Labour (Appeals) forconsideration, since the petitioner-VSNL had filed a petition underSection 51 of the Tamil Nadu Shops and Establishments Act, 1947 before thesecond respondent-Commissioner of Labour in TNSE.Case No.2 of 2007 todecide the question whether the provisions of the Tamil Nadu Shops andEstablishments Act, 1947 (for short, the TNSE Act) will apply to them ornot.3. The third respondent, aggrieved by the order passed by thepetitioner-VSNL, dated 13.7.2007, terminating his services, invoked theprovisions of Section 41 of the TNSE Act and filed appeal before the firstrespondent and requested for setting aside the order dated 13.7.2007.However, to forestall the said proceedings initiated under Section 41 ofthe TNSE Act, the petitioner-VSNL moved the second respondent in TNSE.CaseNo.2 of 2007 to declare that TNSE Act is not applicable to the petitioner-VSNL. 4. Learned Counsel appearing for the petitioner-VSNL, after makingcertain submissions, wanted to withdraw the Writ Petition. This Court,refused the permission sought for withdrawal of the Writ Petition,because, the issue raised by the petitioner-VSNL has already been answeredby this Court in the decision reported in 1977 (II) L.L.J. 202(S.Ramanathan vs. Saroja Mills Ltd., Madurai). Therefore, the question ofthe petitioner-VSNL being relegated to either of the authority, namely thesecond respondent or the first respondent, is unnecessary, and it willamount to further waste of time deciding the same issue again and again. 5. The only contention of the petitioner-VSNL is that they do notfall within the definition of Section 2(3) of the TNSE Act, which definesthe term "Commercial Establishment", which is as under: " ... an establishment which is not a shop butwhich carries on the business of advertising,commission, forwarding or commercial agency, or whichis a clerical department of a factory or industrialundertaking or which is an insurance company, jointstock company, bank, broker's office or exchange andincludes such other establishment as the StateGovernment may by notification declare to be acommercial establishment for the purposes of this Act."Therefore, the petitioner-VSNL submits that since the question ofapplicability of the TNSE Act will have to be necessarily decided by thesecond respondent-Commissioner of Labour, until such time, he renders afinding, the first respondent should not be allowed to proceed with the https://hcservices.ecourts.gov.in/hcservices/ appeal filed by the third respondent-S.Gajendran, under Section 41 of theTNSE Act.6. The prayer for issuance of a Writ of Mandamus, will arise only ifthe first respondent-Special Deputy Commissioner of Labour (Appeals)clutches on to a jurisdiction, which was not conferred by the provisionsof the TNSE Act. But when once the Court finds that there is nojurisdictional error or lack of jurisdiction on the part of the firstrespondent, there is no question of entertaining the Writ Petition of thisnature.7. Since this Court had already decided a similar issue, there isnothing that the second respondent can decide in terms of Section 51 ofthe TNSE Act in TNSE.No.2 of 2007 filed by the petitioner-VSNL.8. The only contention of the petitioner-VSNL before the secondrespondent is that they are a Company which does not come within thedefinition of Section 2(3) of the TNSE Act, which defines the 'commercialestablishment' (extracted above) and therefore, the provisions of theTNSE Act will not apply.9. In paragraph 10 of the affidavit filed in support of the WritPetition, it is averred as follows:"10. VSNL is not carrying on the business ofadvertisement, commission, forwarding or commercialagency. VSNL is not an insurance company, joint stockcompany, bank, broker's office. Thus, VSNL will notcome under the purview of commercial establishment asdefined under section 2(3) of the Act. Needless tostate that VSNL is not an eating-house, shop,residential hotel, theatre or a place of publicinvestment or entertainment. There is no notificationissued by the State Government extending the provisionsof the Act to Telecommunication Providers such as VSNL.It is therefore submitted that the Act is notapplicable to VSNL."10. In paragraph 2 of the affidavit filed in support of the WritPetition, the petitioner-VSNL itself describes that it was incorporated asa Company on 19.3.1986 under the Indian Companies Act, 1956, as a whollyowned Government Company to take over the activities of erstwhile OverseasCommunication Services with effect from 1st April, 1986. Subsequently, thesaid Company had disinvested its shares in VSNL and the Government ofIndia divested a portion of VSNL's equity shares to certain funds, Banksand financial institutions controlled by the Government in the year 1992 https://hcservices.ecourts.gov.in/hcservices/ and to the general public in the year 1999 and in the year 1997, theGovernment of India sold some of its equity holding through GlobalDepository Receipts, following which VSNL was listed in the London StockExchange and in 2000, VSNL became the first public sector undertaking ofIndia to be listed on the New York Stock Exchange and in February 2002,the Government of India sold 25% of the equity shares in VSNL in favourof the Tata Group and it has become a Company controlled by the TataGroup. This itself will go to show that the petitioner-VSNL is a share-holding company and comes within the definition of the Joint StockCompany. When once it is a "Joint Stock Company", then automatically, itis covered by the ingredients of Section 2(3) of the TNSE Act, where theterm 'commercial establishment' includes a Joint Stock Company. 11. As stated earlier, similar question came up for considerationbefore this Court in the decision reported in 1977 (II) L.L.J. 202 (citedsupra) and a learned Judge of this Court held as under in paragraph 5 ofthe said decision:"5. ... The expression "commercialestablishment" is thus defined in cl.(3) of S.2 of theAct:" 'commercial establishment' means anestablishment which is not a shop but whichcarries on the business of advertising,commission, forwarding or commercial agency,or which is a clerical department of afactory or industrial undertaking or whichis an insurance company, joint stockcompany, bank, broker's office or exchangeand includes such other establishment as theState Government may by notification declareto be a commercial establishment for thepurposes of this Act." It is pointed out by the learned counsel for thepetitioner that the Thiagarajar Mills wherein he isemployed is a joint stock company and, therefore, a"commercial establishment" within the meaning of thedefinition just above extracted, and that on thataccount, he fulfils all the conditions laid down insub-cl.(iii) of cl.(12) of S.2. The argument appears tome to be sound. It is true that the petitioner does notbelong to the clerical department of an industrialundertaking, and that part of Thiagarajar Mills inwhich he works does not fall under that portion of thedefinition of "commercial establishment" which talks ofsuch a department. But a department of that type is not https://hcservices.ecourts.gov.in/hcservices/ the only thing which is regarded as a commercialestablishment. Clause (3) of S.2 of the Act embraceswithin its fold various types of establishments andsays that an establishment which is not a shop, butwhich fulfils one of the numerous other alternativesspecified therein would be a commercial establishment.Thus, an establishment which is not a shop, but which--(i) carries on the business of advertising, or(ii) carries on the business of commission, or(iii) carries on the business of forwarding, or(iv) carries on the business of commercial agency,or(v) is a clerical department of a factory orindustrial undertaking, or(vi) is an insurance company, or(vii) is a joint stock company, or(viii) is a bank, or(ix) is a brokers' office, or(x) is an exchange, or(xi) is an establishment notified by the StateGovernment to be a commercial establishment,would be acommercial establishment within the meaning of cl.(3)of S.2 of the Act. According to the petitioner,Thiagarajar Mills is a joint stock company. If that beso, it will have to be regarded as a commercialestablishment within the meaning of cl.(3) of S.2. Nowit is a concern admittedly owned and being run bySaroja Mills Ltd. which is a joint stock company. Thisfact, however, is regarded by the learned counsel forthe respondents as irrelevant. He argues thatThiagarajar Mills itself should be a joint stockcompany, and as it is not one, we cannot look upon itsownership in order to find out whether it is a jointstock company or not. The argument has to be rejectedas a fallacious. When cl.(3) of S.2 talks of anestablishment being a joint stock company, itnecessarily refers to its constitution and, therefore,to its ownership and not to the type of work done byit, even though most of the other requirements of theclause would appear to make the nature of the businesstransacted by an establishment as the criterion forfinding out whether it is a commercial establishment ornot. This is so because the words "joint stock company"do not envisage the nature of work transacted by theestablishment concerned. In order to find out whetheran establishment is a joint stock company or not, itwill have to be seen as to who is running it withoutreference to the nature of the business carried on byit and then to be determined whether the owner is a https://hcservices.ecourts.gov.in/hcservices/ joint stock company or not. If it is, the establishmentmust be regarded as a commercial establishment."12. Therefore, in the light of the finding that the petitioner-VSNLis a "Joint Stock Company", and covered by the provisions of Section 2(3)of the TNSE Act, the prayer sought for by the petitioner to stall theproceedings of the first respondent from hearing the TSE.Case No.18 of2007 till the second respondent decides the application in TNSE.No.2 of2007, is clearly misconceived. The Writ Petition is devoid of merits andthe same is liable to be dismissed. 13. The proceedings of the petitioner-VSNL initiated before thesecond respondent in TNSE.No.2 of 2007 under Section 51 of the TNSE Act,will become infructuous by the findings rendered herein. The firstrespondent-Special Deputy Commissioner of Labour (Appeals) is directed toproceed with the appeal filed by the third respondent-Gajendran, underSection 41 of the TNSE Act in TSE.Case No.18 of 2007, on merits and inaccordance with law. 14. With the above observations, the Writ Petition is dismissed. Nocosts. The Miscellaneous Petition is closed.csSd/Asst. Registrar/true copy/Sub Asst.RegistrarTo1. The Special Deputy Commissioner of Labour (Appeals), Authority under Section 41 of the Tamil Nadu Shops & Establishments Act, 1947 DMS Compound, Chennai-600 006.2. The Commissioner of Labour, Authority under Section 51 of the Tamil Nadu Shops & Establishments Act, 1947, DMS Compound, Chennai-600 006.+ One cc to M/s King and Partridge, Advocte SR 70950+ One cc to Govt Pleadeer SR No.71105JRG (co)sg 07/12/07W.P.No.35943 of 2007 30.11.2007