ORDER M. Katju, J.
1. This writ petition has been filed for a writ of certiorari to quash the impugned award of the Labour Court, Kanpur, dated January 10, 1996 Annexure-1 to the writ petition and for a mandamus directing the respondent No. 1 to treat the petitioners as their employees and pay them emoluments accordingly.
2. I have heard Sri T. P. Singh and Sri B. N. Singh for the petitioners and Sri V. B. Upadhyaya, learned counsel for the respondent No. 1.
3. The respondent No. 1 is a Government company registered under the Indian Companies Act and working under the supervision and control of the Ministry of Social Welfare, Government of India. The respondent No. 1 has set up a factory for manufacturing artificial limbs in which more than 700 workmen, supervisors and officers are working.
4. The respondent No. 1 established a canteen for the use and benefit of the workmen, supervisors and officers as stated in paragraph 3 of the petition. The grievance of the petitioner is that although they are working in the canteen of respondent No. 1 but it is not treating them as its own employees and instead they are being treated as employees of the contractor and they are getting less salary than the regular employees of respondent No. 1.
5. The petitioner raised an industrial dispute which was referred to the Labour Court and the Labour Court has decided against the petitioners. Hence this petition.
6. The Labour Court in its award has held that only the appropriate Government can abolish contract labour by notification under Section 10 of the Contract Labour (Regulation and Abolition) Act, 1970 and the Labour Court has no power to do so, unless there was no genuine contract and the so called contract was only a sham or a camouflage to hide the reality vide Gujarat Electricity Board, Thermal Power Station, Ukai, Gujarat v. Hind Mazdoor Sabha, AIR 1995 SC 1986 : 1995 (5) SCC 27 : 1995-II-LLJ-790. The Labour Court has held that the workers had not contended that the contract is a sham or camouflage and hence in view of the decision in Gujarat Electricity Board's case (supra), only the appropriate Government and not the Labour Court could abolish the contract labour and regularise the workmen.
7. Sri T.P. Singh learned counsel for the petitioner relied on the decision of the Supreme Court in the case of Parimal Chandra Raha v. Life Insurance Corporation of India, AIR 1995 SC 1666 : 1995 Supp (2) SCC 611 : 1995-II-LLJ-339. The said decision states as follows:
"What emerges from the statute law and the judicial decisions is as follows:
(i) Whereas under the provisions of the Factories Act, it is statutorily obligatory on the employer to provide and maintain canteen for the use of his employees, the canteen becomes a part of the establishment and, therefore, the workers employed in such canteen are the employees of the management.
(ii) Where, although it is not statutorily obligatory to provide a canteen, it is otherwise an obligation on the employer to provide a canteen, the canteen becomes a part of the establishment and the workers working in the canteen, arc the employees of the management. The obligation to provide a canteen has to be distinguished from the obligation to provide facilities to run canteen. The canteen run pursuant to the latter obligation, does not become a part of the establishment.
(iii) The obligation to provide canteen may be explicit or implicit. Where the obligation is not explicitly accepted by or cast upon the employer either by agreement or an award, etc., it may be inferred from the circumstances, and the provisions of the canteen may be held to have become a part of the service conditions of the employees. Whether the provision for canteen services has become a part of the service condition or not, is a question of fact to be determined on the facts and circumstances in each case.
Where to provide canteen services has become a part of the service conditions of the employees, the canteen becomes a part of the establishment and the workers in such canteen become the employees of the management.
(iv) Whether a particular facility or service has become implicitly a part of the service conditions of the employees or not, will depend among others, on the nature of the service facility, the contribution of the service in question makes to the efficiency of the employees and the establishment, whether the service is available as a matter of right to all the employees in their capacity as employees and nothing more, the number of employees employed in the establishment and the number of employees who avail of the service, the length of time for which the service has been continuously available, the hours during which it is available, the nature and character of management, the interest taken by the employer in providing, maintaining, supervising and controlling the service, the contribution made by the management in the form of infrastructure and funds for making the service available etc."
8. Sri T.P. Singh firstly submitted that the canteen workers are the employees of the respondent No. 1 in view of Section 46 of the Factories Act which casts a statutory obligation on respondent No. 1 to provide and maintain a canteen for the use of its employees and hence the case of the petitioners conies under Clause (i) of paragraph 25 of the aforesaid decision. I cannot agree with this submission. Section 46(1) of the Factories Act states as follows:
"The State Government may make Rules requiring that in any specified factory wherein more than two hundred and fifty workers are ordinarily employed, a canteen or canteens shall be provided and maintained by the occupier for me use of the workers."
9. A perusal of the above provision shows that it applies to a specified factory wherein more than two hundred and fifty workers are ordinarily employed. Thus in order to fulfil the requirement of Section 46(1) not only must there be ordinarily more than two hundred and fifty workers employed but the additional requirement is that the factory must be a specified factory. Thus it is not every factory which employs 250 workers or more which required to maintain canteen but only such factories which are specified by the State Government. This is also evident from Rule. 68(1) of the U.P. Factories Rules, 1950.
10. There was no averment by the petitioner before the Labour Court or even before this Court that the factory of the respondent No. 1 has been specified under: Section 46 read with Rule 68(1). Hence Section 46 of the Factories Act has no application.
11. Sri T. P. Singh then contended that the case of the petitioners comes within Clause (ii) of paragraph 25 of the decision in Parimal Chandra Raha's case (supra). He relied on Clause 29 of the Standing Orders of the establishment of the respondent No. 1 which treats the canteen staff as an essential service. His contention is that since the canteen service is an essential service hence it is obligatory on respondent No. 1 to have a canteen.
12. In my opinion, a reading of Clause 29 of the Companies' Standing Orders certainly gives an indication that a canteen is an essential service and hence prima facie it seems that it is obligatory on the respondent No. 1 to have a canteen for the workmen. However, the question in the present case is whether the Labour Court has jurisdiction to declare that the workers employed by the contractor in the canteen are the employees of the principal employer i.e., the respondent No. 1 or not.
13. Sri V. B. Upadhyaya learned counsel for the respondent No. 1 relied on the decision of Gujarat Electricity Board, Thermal Power Station, v. Hind Mazdoor Sabha (supra) and submitted that it is only the Central Government which can abolish the contract labour and regularise the workers and this cannot be done by the Labour Court. On the other hand, Sri T. P. Singh submitted that the decision of Gujarat Electricity Board Thermal Power Station (supra) has been overruled by a recent three-Judge decision of the Supreme Court in Air India Statutory Corporation v. United Labour Union, AIR 1997 SC 645 : 1997 (9) SCC 377 : 1997-I-LLJ-1113.
14. I have carefully perused the decision of the Supreme Court in Air India Statutory Corporation case (supra). In this case the facts were that the appellant had engaged contract labour but the Central Government by a notification under Section 10 of the Contract Labour (Regularisation and Abolition) Act prohibited employment of contract labour for sweeping, cleaning, dusting and watching of the buildings of the establishment. The question was as to whether this prohibition of contract labour by notification under Section 10 meant that the contract labour became automatically employees of the principal employer or not.
15. In Dena Nath v. National Fertilisers Ltd. AIR 1992 SC 457 : 1992 (1) SCC 595 : 1992-I-LLJ-289, the Supreme Court held that when contract labour is prohibited by a notification under Section 10 of the Act it does not mean that the employees of the contractor automatically became employees of the principal employer. This decision of the two-Judge Bench of the Supreme Court in Dena Nath's case (supra) has been specifically overruled by the three-Judge decision in Air India Statutory Corporation's case (supra) and it has been held in the latter case that:
"Abolition of contract labour system ensures right to the workmen of regularisation of them as employees in the establishment in which they were hitherto working as contract labour through the contractor. The contractor stands removed from the regulation under the Act and direct relationship of "employer and employees" is created between the principal employer and workmen."
16. Thus it has been held in Air India Statutory Corporation's case (supra) that the consequence of abolition of contract labour by a notification under Section 10(1) of the Act is that the intermediary i.e. the contractor is removed from the field, and direct linkage between labour and the principal employer is established. In other words, on the abolition of contract labour by notification under Section 10, the employees of the contractor automatically become employees of the principal employer.
17. As regards the submission of Sri T. P. Singh that the decision in Air India Statutory Corporation's case (supra) has overruled the two-Judge decision in Gujarat Electricity Board v. Hind Mazdoor Sabha (supra) a careful perusal of these two decisions shows that the larger Bench in Air India Statutory Corporation's case has overruled the smaller Bench case in Gujarat Electricity Board's case only to the extent that whereas the decision by the smaller Bench had held that even after abolition of contract labour by notification under Section 10, it is for the industrial adjudicator to decide on the facts of the case whether the principal employer should he directed to absorb the workmen of the erstwhile contractor or not and on what terms (vide paragraphs 43, 44 and 45 of the decision in Gujarat Electricity Board's case). Thus the decision of the two-Judge Bench of the Supreme Court in Gujarat Electricity Board's case (supra) had held that on abolition of contract labour by notification under Section 10, there is no automatic absorption of the contract labour in the principal establishment and it is for the Labour Court to decide whether such contract labour is to be absorbed in the service of the principal employer or not, and if so on what terms.
18. This view of the two-Judge Bench in Gujarat Electricity Board's case that there is no automatic absorption of contract labour in the principal establishment on issuing of notification under Section 10, has been overruled by the three-Judge Bench of the Supreme Court in Air India Statutory Corporation case (supra) and it has been held in the latter case that there is automatic absorption of contract labour on issuance of notification under Section 10.
19. However, the view in Gujarat Electricity Board's case (supra) that it is only the appropriate Government which can abolish contract labour (vide paragraph 33 of the said decision) has been endorsed by the larger Bench in Air India Statutory Corporation's case (supra). Thus in the decision in Air India Statutory Corporation's case it has been observed:
"The Court cannot enquire into and decide the question whether employment of Contract labour in any process, operation or any other work in establishment should be abolished or not and it is for the appropriate Government to decide it."
20. Hence it cannot be said that the decision in Gujarat Electricity Board's case (supra) has been entirely overruled by the decision of the larger Bench in Air India Statutory Corporation case (supra). Rather, the larger Bench has specifically reiterated the view in Gujarat Electricity Board's case that only the appropriate Government can abolish contract labour.
21. It seems that the decision in Air India Statutory Corporation's case has not referred to the decision of the two-Judge Bench decision of the Supreme Court in Parimal Chandra Raha 's case. The latter decision has not gone into the question which is before us i. e. whether the Labour Court can abolish contract labour or not. Hence the said decision cannot be regarded as an authority on this point, although the considerations mentioned in paragraph 25 therein may be relevant for the appropriate Government for deciding whether to abolish contract labour under Section 10.
22. It may be noted that in Air India Statutory Corporation's case contract labour was not abolished by the Labour Court but by the appropriate Government. In the light of the aforesaid decision, therefore, it has to be held that there is no infirmity in the impugned award of the Labour Court dated January 10, 1996. In my opinion, the Labour Court has rightly held that it is only the appropriate Government which can abolish contract labour and regularise them in the service of the employer and this cannot he done by the Labour Court.
23. The remedy of the petitioner was to approach the appropriate Government with a prayer for abolition of contract labour under Section 10 of the Act and not to have raised an industrial dispute. The petition is therefore, dismissed but with the observation that if the petitioners make an application to the appropriate Government under Section 10 of the Contract Labour (Rcgularisation and Abolition) Act, the same will be decided within four months thereafter hearing the parties concerned in accordance with law.