Rajiv Shakdher, J
TABLE OF CONTENTS
Preface:
Background:-
Submissions on behalf of the petitioners:-
Submissions on behalf of FCI
Analysis and reasons
Conclusion
Preface:
1. Shorn of unnecessary details, the grievance which has impelled the petitioners to approach this Court is briefly this:
1.1. The petitioners, who are regular employees of respondent no.2 i.e., the Food Corporation of India [hereafter referred to as “FCIâ€] apprehend
being transferred en bloc from FCI Food Storage Depots [in short “FSDsâ€] located at Shakti Nagar and Mayapuri to depots located at Okhla and
other locations.
1.2. It is the petitioners’ case that both depots i.e., FCI FSDs located at Shakti Nagar and Mayapuri, where they are presently located, have
notifications issued qua them, under Section 10 of the Contract Labour (Regulation &Abolition) Act, 1970 [in short “CLRA Actâ€]. Thus,
according to the petitioners, once the notification under Section 10 of the CLRA Act was issued, the FCI could not have deployed contract labour in
the aforementioned depots [i.e., FSD Shakti Nagar and FSD Mayapuri], and therefore, in pursuing this course, FCI has whittled down their legal
rights, by attempting to redeploying/transferring them en bloc to another depot.
1.3. It is on account of this grievance that the petitioners have approached this Court by way of the above-captioned writ petitions, to assail e-tender
notice no.4/2021 dated 01.03.2021 and e-tender notice no.5/2021 dated 23.06.2021. Insofar as e-tender notice no.4/2021 is concerned, it is assailed in
W.P.(C)No.5080/2021, while e-tender notice no.5/2021 has been challenged in W.P.(C)No.6060/2021.
2. At this stage, it would be relevant to note that after the matters were reserved, an affidavit dated 29.10.2021 was filed in W.P.(C) No.6060/2021 on
behalf of FCI, stating that e-tender notice no.5/2021 dated 23.06.2021 had been cancelled on 12.10.2021; an aspect which was alluded to across the
bar in the course of the hearing.
2.1 Given this position, we had, in the course of the hearing, tried to ascertain from the counsel appearing on behalf of FCI, as to whether FCI would
be issuing a fresh tender for engaging contractual labour at FSD Mayapuri. Since we did not get a clear response, hearing in the concerned writ
petition i.e., W.P.(C)No.6060/2021 was also continued, along with W.P.(C)No.5080/2021.
3. It would be worthwhile to note, at this juncture, that FCI banks upon the notification dated 06.07.2016, issued by the appropriate government
[respondent no.1 i.e., the Government of India (GOI)] under Section 31 of the CLRA Act, to contend that the notifications issued under Section 10 of
the very same Act, qua the depots covered under it have been rendered inefficacious. Thus, insofar as FSD Shakti Nagar is concerned, FCI contends
that the prohibition against the engagement of contractual labour is no longer applicable. As regards FSD Mayapuri is concerned, FCI's stand is that
notification under Section 10 of the CLRA Act has not been issued by the appropriate government, and, therefore, the objection taken by the
petitioners vis-a-vis FSD Shakti Nagar would not be applicable in the case of FSD Mayapuri.
3.1 It is, however, not disputed by FCI that since the notification dated 06.07.2016 had a limited span of two years, it was extended twice i.e., on
26.06.2018 and 25.06.2020.
3.2 It is also not disputed by FCI that notifications dated 06.07.2016 and 26.06.2018 are the subject matter of challenge in W.P.(C) No.7627/2016,
titled FCI Handling Workers Union vs. Union of India & Ors., and W.P.(C) No.7241/2016, titled Food Corporation of India Shramik Union vs. Union
of India & Anr., which are pending adjudication before the learned single judge. The petitioners and FCI are at odds concerning the challenge to the
notification dated 25.06.2020, whereby the duration of the initial notification dated 06.07.2016 was extended post 26.06.2018.
3.3 The record shows (something which is not disputed by FCI) that interim orders dated 13.09.2017and 13.11.2017 were passed in W.P.
(C)No.7241/2016 and W.P.(C) No. 7627/2016, respectively. It is also not in dispute that, via two separate orders dated 04.02.2019 in W.P.(C)
No.7241/2016 and W.P.(C) No.7627/2016, the interim orders dated 13.09.2017 and 13.11.2017 were made absolute by the learned single judge.
Importantly, the order dated 13.11.2017, passed in W.P.(C)No.7627/2016, was predicated on the order dated 13.09.2017 passed in W.P.
(C)No.7241/2016. Although liberty was given by the learned single judge, while making the order absolute on 04.02.2019 [in W.P.(C) No.7627/2016]
to seek vacation of the interlocutory order i.e., order dated 13.11.2017, nothing has been brought to our notice which would indicate that the said
order(s) stands vacated. This aspect was noticed by us while passing an interlocutory order on 06.05.2021, in W.P.(C) No.5080/2021.
“Time is sought on behalf of the respondents to file reply to the CM No.32805/2017 which be filed within a period of one week.
Renotify for hearing on 21st September, 2017 at 12:30 P.M. Transfer orders, if not yet implemented, be not implemented till the next date of
hearing.
A copy of order be given dasti to both the sides.â€
“CM No. 39869/2017
Heard. Learned counsel for the petitioner relied upon order dated13.09.2017 passed in W.P. 7241/2016 and CM No. 32805/2017.
Learned counsel for the respondent submits that the petitioner has concealed the material facts in the petition and hence, they are not
entitled for the stay.
In view of the submissions made in the application, transfer orders, if not yet implemented, be not implemented till the next date of hearing.
Reply be filed within two weeks. Response thereto, if any, be filed within one week thereafter. Renotify on 11.12.2017, the date already
fixed…..â€
4. It may also be relevant to note that at one juncture, the parties were asked to attempt a settlement in the matter. We were informed that the
deliberations carried out by representatives of parties did not fructify into a firm settlement agreement.
Background:-
5. FCI’s main plank in defence of its action in engaging contractual workers is pivoted on the judgment rendered by the Bombay High Court
(Nagpur Bench) in a public interest petition i.e., PIL No.84/2014, dated 20.11.2015. The Division Bench issued a slew of directions to FCI, which are
contained in paragraph 30 of the judgment. These directions read as follows:
“ 30. In that view of the matter, we dispose of the present Public Interest Litigation by passing the following order.
(i) The Government of India is directed to decide the representation made by the Food Corporation of India for grant of exemption under
the provisions of Section 31 of the said Act within a period of one month from today, in the light of observations made by us hereinabove
within a period of one month from today.
(ii) The Government of India shall decide the issue regarding de-notification of the depots of the Food Corporation of India, in respect of
which notification is issued u/s. 10 of the said Act, within a period of six months from today, in the light of observations made by us
hereinabove and the report of M/s Deloitt Consultancy and the report of the High-Level Committee appointed by the Government of India
itself.
(iii) We clarify that the respondent/Food Corporation of India would be entitled to transfer the services of departmental labourers from one
depot to another subject to protecting their salary and all other service conditions.
(iv) We also clarify that the respondent/Corporation would be at liberty to implement its policy of change in the Scheme of incentives.
(v) The Government of India shall also take a decision regarding abolition of system of departmental labourers in a phased manner or
absorbing their services in other establishments as recommended by the High Level Committee.â€
5.1. Being aggrieved, the FCI Workers Union, FCI Shramik Union and FCI Handling Workers’ Union had carried the matter in appeal to the
Supreme Court. These matters were registered as SLP(C) (CC) Nos.136/2016, 913/2016 and 11465/2016.
5.2. On 08.07.2016, the Supreme Court issued notice in the aforementioned SLPs and made the following observations in paragraph 3 of its order:
“We make it clear that the pendency of the present proceedings shall not prevent the petitioners from filing a petition, if so advised, to
challenge the notification issued under Section 31 of the Act on all such grounds as are legally open to it….â€
5.3 The final order in the aforesaid SLPs was passed on 31.07.2017, which reads as follows:
“1. We do not see any merit in these special leave petitions, which are hereby dismissed. We make it clear that this order shall not prevent
the petitioners â€" Food Corporation of India Workers Union/Food Corporation of India Shramik Union/FCI Handling Workers Union, to
challenge any order, passed in furtherance of the directions issued in the impugned order (dated 20.11.2015), in appropriate proceedings
before an appropriate Court.
2. In case, such a challenge is raised by the petitioner(s), in continuation of the liberty granted to the petitioner(s), the claim raised by the
petitioner(s) shall be considered in accordance with law, uninfluenced by any observations made by the High Court in the impugned order
(dated 20.11.2015).â€
5.4. Thus, the challenge raised by the FCI Shramik Union and FCI Handling Workers’ Union to the Section 31 notifications, issued under the
CLRA Act, in W.P.(C) Nos.7627/2016 and 7241/2016 has to be foregrounded in the liberty given by the Supreme Court, via the aforementioned
orders.
6. Given this, what is required to be examined is whether FCI could engage and deploy contract labour in FSD Shaktinagar and FSD Mayapuri, and, to
effectuate this purpose, carry out en bloc transfer of employees from the said notified depots to other depots.
6.1. There can be no gainsaying that transfer is an incident of service and unless the transfer is carried out for malafide purpose or against the
provisions of a statute or policy, an order passed to that effect, that is transferring an employee from one location to another without altering his terms
of service, cannot be interdicted.
6.2. The FCI, in support of its plea that petitioners cannot resist transfer, although, it is an en masse transfer from one location to another, has adverted
to Clause 5 of Certified Standing Orders (CSO). The said clause reads as follows:
“Workers shall be liable to be transferred from one place of work to another place of work of the Corporation as per practice in
existence with a whole gang, except in the case of request for transfer from the individual worker.â€
6.3. Furthermore, in support of this plea, FCI has also relied upon its guidelines dated 12.07.2016. These guidelines were framed for the
implementation of exemption notification dated 06.07.2016, issued under Section 31 of the CLRA Act. A bare perusal of the said guidelines would
show that it broadly adverts to the following aspects:
(i) That notification dated 06.07.2016 was issued in pursuance of the directions contained in the judgment of the Nagpur Bench of Bombay High Court
dated 20.11.2015, passed in PIL No.84/2014.
(ii) The said notification has exempted depots and railheads of FCI from the applicability of all earlier notifications specified therein for two years,
subject to the compliance of conditions specified in Rule 25(2)(v)(a) of the Contract Labour (Regulation & Abolition) Central Rules, 1971 (in short
“the CLRA Rulesâ€).
(iii) Out of the 289 depots and railheads, which stood notified [pursuant to 13 notifications issued under Section 10 of CLRA Act], 226 were exempted,
as they were covered under notification dated 06.07.2016. Resultantly, FCI could reorganize and rationalize its workers working under various
systems [i.e., Departmental System (DS); Direct Payment System (DPS) and No Work No Pay System (NWNPS)], by pooling and locating them
into fewer depots, as per operational requirements, so that the optimum number of workers is deployed to carry out FCI operations, in an efficient
manner.
6.4. In the interregnum i.e., between the time the judgment of the Bombay High Court (Nagpur Bench) dated 20.11.2015 was rendered and
notification dated 06.07.2016 was issued by the appropriate government which were sought to be implemented by FCI through guidelines dated
12.07.2016 to reorganize and rationalize the deployment of its workers for enhancing its operational efficiency, FCI had, in the first instance, moved
the Central Advisory Contract Labour Board (in short “Central Boardâ€) for seeking exemption under Section 31 of the CLRA Act. The Central
Board, at its 88th Meeting held on 30.03.2016 and 31.03.2016 repelled these attempts. The relevant parts of the minutes of the 88th Meeting of the
Central Board, which are captured in a document dated 13.04.2016, read as follows:
“Item No. 5: Consideration of the request of the Ministry of Consumer Affairs, Food and Public Distribution, Department of Food and
Public Distribution, for seeking exemption under section 31 of Contract Labour (R&A) Act, 1970 from the purview of various notifications
prohibition employment of contract labour in various jobs of loading/unloading, stacking, de-stacking, weighment, sweeping and cleaning in
the 128 and 98 railheads and depots respectively in all 226 depots/railheads of FCI. (S. 16012/2011-LW).
The representatives of five Workers' Union and that of the FCI Management were present. The CACLB took note of the directions of the
Hon'ble Bombay High Court, Nagpur Division Bench in PIL No. 84. of 2014 dated 20.11.2015. The Board heard the representatives of FCI
Management and their lawyer, and the representatives of the respective Worker's Unions.
 The Trade Unions submitted before prohibitory notifications issued by the Central Government in respect of 226 Rail Heads and Depots
should not be considered.
 The FCI management submitted that the main functions of FCI are procurement, transportation, storage and distribution of food grains.
These functions by their very nature are seasonal and sporadic. It was submitted that the workload in FCI depots is not uniform on all days
and the trend of procurement is absolutely uneven across the months of any year. It was pleaded that the similar type of work is not
ordinarily being done by the regular workmen in other organisations like Central Warehousing Corporation and various State
Warehousing Corporations. FCI submitted that the notifications prohibiting engagement of contract labour in 226 depots are based on
arbitrary yardsticks and are contrary to the provisions of CL9R&A) Act. FCI requested that the prohibitory notifications issued so far in
respect of 226 depots may be de-notified and the FCI depots/Railheads may be exempted from the provisions of CL (R&A) Act without
conditions and any fixed period: 'As per the submission made before the CACLB, the FCI intended to phase out regular employees (some of
them are getting salary including allowances upto Rs. 4 Lakh a month) based on the recommendations made by the High Power Committee
and the Deloitte International Consultancy.
 FCI is planning to engage only contract labour in place of four categories (1) regular employees (2) Direct Pay System (3) No Work No
Pay (4) Contract Labour System. Further, in regard to the query of the Board in respect of emergency involved for seeking exemption, it
was admitted by the FCI that there is no fresh emergency as such in view of the fact that the jobs of loading/unloading, stacking, de-
stacking, weighment,the sweeping and cleaning being carried out in establishment are per se emergent in nature.
 The Section 31 of the Act provides for exemption for a specific period in case of an emergency which reads as under:-
 ""Power to exempt in special cases- The appropriate Government may, in the case of an emergency, direct, by notification in the Official
Gazette, that subject to such conditions and restrictions, if any, and for such period or periods, as may be specified in the Notification, all or
any of the provisions of this Act or the Rules made thereunder, shall not apply to any establishment or class or establishments or any class of
contractors.
 The Board was of the view that there is no provision in the Act in regard to de-notification of a prohibitory notification. In this regard the
Board had asked the FCI management to submit the outcome of implementation of the exemption notification dated 03.05.2012 and the cost
cutting measures undertaken during the period of exemption. T may be mentioned that vide the exemption notification dated 03.05.2012, 29
godowns and depots of FCI were granted exemption from the applicability of the notification dated 07.02.2011 for a period of 6 months
subject to compliance of the conditions as stipulated in Section 25 (2)(v)(a) of Contract Labour (Regulation & Abolition) Central Rules,
1971. The CACLB asked in regard to the implementation of the aforesaid exemption notification, FCI Management informed that the said
exemption granted by the Central Government could not be availed as the FCI management has made some alternative arrangement in order
to deal with the situation at hand. FCI did not come out and submit their Action Plan of Rationalization in support of their request for grant
of exemption.
 The Board was of the view that blanket exemption in respect of 226 Depots could not be possible because CACLB can examine the
cases/requests for grant of exemption case-wise/establishment-wise. The Board was of the view that the Depotwise/establishment-wise
reasons for exemption along with the nature of emergency involved should have been furnished by FCI to enable the Board to examine the
exemption request.
 In view of above explained reasons, the CACLB unanimously decided not to accept the request of the FCI for grant of exemption for
following reasons: The ground of emergency submitted by FCI is not establishment-wise /depot-wise and not specific. The non-production of
future rationalization action plan of the establishment;
FCI seeking blanket exemption for entire establishment without conditions and without fixed period which cannot be granted as per Section
31 of CL (R&A) Act, 1970.â€
 [Emphasis is ours.]
6.5. We may note that the FCI did not agree with the conclusions reached by the Central Board, which is reflected in a document titled
“COMMENTS ON BEHALF OF FOOD CORPORATION OF INDIA WITH REFERENCE TO THE MINUTES OF 88TH MEETING OF
CACLB DATED 13.04.2016â€.
6.6. As is obvious, FCI having failed to persuade the Central Board, thereafter, approached the appropriate government for exemption of the
notifications under Section 31 of the CLRA Act which, as noted above, was issued on 06.07.2016, albeit, for a period of two years, and, thereafter,
followed by the notifications dated 26.06.2018 and 25.06.2020.
6.7. After the guidelines dated 12.7.2016, another communication dated 31.12.2020 was issued by FCI to rationalize “labour strengthâ€.
7. With this foreground, and at this stage, it would be relevant to record the contentions advanced on behalf of the petitioners and FCI. Insofar as the
petitioners are concerned, the submissions were advanced by Mr Rajesh Mohan Sinha, while on behalf of FCI, arguments were advanced by Ms
Maninder Acharya, learned senior counsel, in W.P.(C) No.5080/2021, and in the other connected writ petition i.e., W.P.(C) No.6060/2021, Mr Om
Prakash held the field on behalf of FCI, and adopted the arguments advanced by Ms Acharya.
7.1. Although notice was issued to all respondents including GOI [i.e., respondent no.1] in the above-captioned writ petitions i.e., on 06.05.2021 [in
W.P.(C) No.5080/2021] and on 09.07.2021 [in W.P.(C) No.6060/2021], and, an opportunity was granted to file counter-affidavit(s), no counter-
affidavit(s) were filed by respondent no.1/ GOI to convey its stand vis-a-vis the issues at hand.
Submissions on behalf of the petitioners:-
8. Mr Sinha, broadly, contended as follows:
(i) FCI, in transferring the petitioners' en bloc, was attempting to do indirectly, what it could not do directly vis-a-vis FSDs involved in the above-
captioned writ petitions, which were notified under Section 10 of CLRA Act and therefore, supplanting contract labour with petitioners in the very
same FSDs by employing the device of en bloc transfer, was illegal.
(ii) The first notification issued under Section 31 of the CLRA Act by the appropriate govt. i.e., notification dated 06.07.2016 exempted godowns,
depots and railheads of FCI from the applicability of notifications issued by it from time to time, spanning between 29.06.1989 and 07.02.2011 and the
notification issued by the State Government of Haryana dated 29.11.1985, in respect of employment of contract labour in different jobs for two years.
This notification, however, excluded 63 godowns, depots and railheads located in various parts of the country.
 (iia) The notification dated 06.07.2016 was infused with fresh life with the issuance of the notification dated 26.06.2018. Like the 06.07.2016
notification, the 26.06.2018 notification also had a life span of two years. These two notifications are the subject matter of challenge in W.P.
(C)Nos.7627/2016 and 7241/2016. The concerned Court has granted an interim order. The FCI, to get around the interim order, once again,
approached the appropriate government for the issuance of yet another notification. This resulted in the appropriate government issuing the third
notification dated 25.06.2020, under the emergency power conferred upon it under Section 31 of the CLRA Act. Notwithstanding this situation, interim
orders dated 04.02.2019, passed, albeit separately, in W.P.(C) No.7267/2016and W.P.(C) 7241/2016 continue to operate, which obliges FCI to
maintain the status quo, with regard to the transfer of the members of the petitioner unions concerned in the said writ petitions.
(iii) FCI’s reliance on the judgment dated 20.11.2015 passed by the Bombay High Court (Nagpur Bench) in PIL No.84/2014 is misplaced, as
while the said judgment did issue directions, to the effect, that it could approach the appropriate government for issuance of a notification under
Section 31 of the CLRA Act and de-notification of notifications issued under Section 10, there was no direction issued for substitution of regular
employees stationed in notified depots, with contract labour.
(iv) The unreasonableness of FCI’s action is discernible from the fact that although it had approached the Central Board for revisiting the issue
concerning the prohibition placed on FCI for engaging contract labour in respect of godowns, depots and railheads, qua which notification under
Section 10 of CLRA Act had been issued, it attempted to circumvent the decision of the Central Board taken in this behalf, at its 88th Meeting by
taking out the impugned tender notices i.e., e-tender notice nos.4/2021 and 5/2021.
(v) Even though, the Supreme Court dismissed the special leave petition filed by the FCI Workers' Union, it gave liberty to the FCI Workers’
Union to assail any order passed in furtherance of the directions issued in the judgment dated 20.11.2015, passed by the Bombay High Court (Nagpur
Bench), in appropriate proceedings, by the appropriate government. The Supreme Court also observed that in case any challenge is raised by the FCI
Workers’ Union in continuation of liberty granted to them, the same shall be considered in accordance with the law uninfluenced by any
observations made in the judgment dated 20.11.2015. In this context, reliance was placed not only on the interim order dated 08.07.2015 but also on
the final order dated 31.07.2017 passed by the Supreme Court in SLP(C) (CC) Nos.136/2016, 11465/2016 and 913/2016 [which was converted into
three SLP(C) Nos.19218-20/2016].
(vi). Therefore, it cannot be said that the aforementioned writ petitions are not maintainable, as it is the stated stand of FCI that the impugned e-tender
notices were taken out to deploy contract labour in FSD Shakti Nagar and FSD Mayapuri, in place of petitioners i.e., regular employees, even though
notifications under Section 10 of CLRA Act had been issued qua them.
(vii). There are three kinds of labour systems prevalent in FCI i.e., Departmental Labour System, Direct Payment System, No Work No Pay System
and with the engagement of contract labour, a fourth system was introduced, which is, the Contract Labour System. The petitioners’ grievance in
the above-captioned writ petitions is the deployment of contract labour in storage depots, which stand notified under Section 10 of the CLRA Act.
Once a notification is issued under Section 10 of the CLRA Act by the appropriate government, after confabulation with the Central Board or as the
case may be with the State Board, there is a presumption in law that relevant factors adverted to in Clause (a) to (d) in sub-section 2 of Section 10
had been taken into account. In particular, the notification of the appropriate government would exemplify that the process or operation or other work
carried out in the concerned establishment is perennial. Therefore, the impugned tender notices are nothing but an attempt to skirt the law.
Submissions on behalf of FCI
9. Ms Acharya on the other hand, broadly, contended as follows:
(i) After the Bombay High Court (Nagpur Bench) had rendered its decision on 20.11.2015, FCI took steps to rationalize its workforce. The disparity in
the wages payable to workmen, as noticed by the Court, impelled FCI to approach the appropriate government for the issuance of exemption
notifications under Section 31 of the CLRA Act. Thus, in line with the same approach, FCI issued the impugned tender notices for engagement of
contract labour.
(ii) The transfer of the petitioners from one depot to the other is being done without varying their service conditions. A transfer is an incident of
service and therefore, this Court ought not to interfere with the decision of FCI taken, in that behalf.
(iii) Insofar as the exemption notification dated 06.07.2016 and 26.06.2018 are concerned, they are the subject matter of challenge in W.P.
(C)No.7627/2016 & 7241/2016 and, therefore, this Court ought not to render a decision, qua these notifications as, if FCI were to fail, it would lose a
forum of appeal.
(iv) The decision of the Supreme Court, whereby SLPs preferred against the judgment of the Nagpur High Court dated 20.11.2015, were dismissed,
gave a pass-through to FCI to implement the directions issued via the said judgment. Therefore, the impugned e-tender notice which has been
published in furtherance of directions issued by the said High Court ought not to be interdicted by this Court.
(v) In case the petitioners are aggrieved, they should take recourse to remedies under the Industrial Disputes Act, 1947 [in short “the ID Actâ€].
[We may indicate herein that, although this submission is incorporated in the written submissions filed on behalf of the FCI, this was not pressed during
the arguments advanced before us.]
(vi) Several High Courts have declined to interfere with transfer orders concerning FCI workers, having regard to the judgment of the Bombay High
Court dated 20.11.2015. In any event, as indicated above, a transfer is an incident of service and in this regard, reference may be made to Clause 5 of
the Standing Orders which applies to the petitioners.
(vii) In support of the aforesaid submissions, reliance has been placed on the following judgments:
a. State of U.P.& Ors v. Gobardhan Lal, (2004) 11 SCC 402
b. Surendrasing Navalising Mahto & Ors v. UOI, passed by the Gujarat High Court in W.P.(C) No. 14738/2016, dated 19.10.2016
c. Ravi B. Ghorpade & Ors v UOI & Ors, passed by the Bombay High Court in Writ Petition (I) No.1935/2016, dated 20.07.2016
d. FCI Workers Union and Ors v. FCI & Ors, passed by the Kerela High Court in W.P.(C) No.35398/2016, dated 13.01.2017
e. Majeed H.K. and Ors v. The General Manager (Kerela) Food Corporation of India and Ors, passed by the Kerela High Court in W.P.(C)
No.2804/2018, dated 02.02.2018
f. Bhartiya Khadya Nigam Mazdoor Sangh and Ors vs FCI Through Its Chairman And Ors., passed by the Allahabad High Court in Writ-A
No.38560/2016, dated 26.09.2016
g. C.S. Saran Kumar v. UOI and Ors, passed by the Madras High Court in W.P. No.26628/2016, dated 17.08.2016
h. Naresh Sahani and Ors v. FCI and Ors, passed by the Gauhati High Court in W.P.(C) No. 3314/2020, dated 11.11.2020
i. State of West Bengal and Ors v Calcutta Hardware Store and Ors, (1986) 2 SCC 203
j. Cotton Corporation of India Ltd v United Industrial Bank Ltd & Ors, (1983) 4 SCC 625
k. State of U.P. & Ors v Siya Ram and Ors, MANU/SC/0585/2004
l. National Hydroelectric Power Corporation Ltd. v. Shri Bhagwan and Anr, (2001) 8 SCC 574
m. Cipla Ltd v Jayakumar R. and Another, (1999) 1 SCC 300
n. K D Sharma v SAIL, (2008) 12 SCC 481
o. S.P. Chengalvarya Naidu vs Jagannath and Ors, (1994) 1 SCC 1
p. Namrata Verma v State of U.P.
& Ors, passed by the Supreme Court in Special Leave to Appeal (C) No.36717/2017, dated 06.09.2021
q. Rani Devi & Anr v Indo Tibetan Border Police, 2021 SCC OnLine Del 3943
r. State Bank of Travancore vs Kingston Computers India Pvt. Ltd., (2011) 11 SCC 524
(viii) The petitioners are factually wrong on two grounds: first, that FSD Mayapuri is not a depot qua which notification under Section 10 of CLRA
Act had been issued. Second, notification dated 25.06.2020 has not been assailed in the two writ petitions, which are pending before the learned single
judge. Therefore, exemption from provisions of the CLRA Act and the Rules framed thereunder continue to apply to notified depots, godowns and
railheads of FCI.
Analysis and reasons
10. Having heard the learned counsel for the parties, what we are required to adjudicate is: whether the impugned tender notices are legally tenable?
11. What has emerged from the record is the following:
11.1 Section 10 notifications, under the CLRA Act, had been issued qua 289 godowns, depots and railheads of FCI.
11.2 Based on a report published in the Times of India, the Bombay High Court, Nagpur Bench took suo motu action, upon it being noticed that some
workmen were carrying home monthly wages in the range of Rs. 4 lakhs, when other contract labourers were earning a monthly wage of around Rs
10,000. It was also noticed that proxies were used by workmen in connivance with the officials of FCI. The court, after taking into account, the report
of M/s Deloitte Consultancy and the High-Level Committee appointed by the GOI, concluded that FCI could reduce its operational costs by engaging
contract labour that was cheaper and perhaps more efficient. It is in this context that certain directions were issued by the said Court. The operative
directions have already been extracted by us in paragraph 5 above.
11.2(a). A perusal of those directions would show that, amongst other directions, the Court issued two principal directives : First, that FCI would
approach the GOI under Section 31 of CLRA Act, for seeking exemption from provisions of said Act and the rules framed thereunder. Second, GOI
shall decide the issue regarding de-notification of the depots of the FCI in respect of which notification is issued under Section 10 of the said Act,
within six months from the date of the order, in the light of observations made in the judgement, the report of M/s Deloitte Consultancy and the report
of the High-Level Committee appointed by GOI.
11.3. Concededly, GOI i.e., respondent no.1 has not de-notified any of the 289 depots although, from amongst these depots, exemption notification
under Section 31 of the CLRA Act has been issued, with regard to 226 depots. FCI has not placed on record anything, which would suggest to the
contrary. As is evident from the record, two out of three notifications i.e., notifications dated 06.07.2016 and 26.06.2018 are the subject matter of
challenge in W.P.(C) Nos.7627/2016 and 7241/2016.
11.4. Pertinently, in the aforementioned writ petitions i.e., W.P.(C) Nos. 7627/2016 and 7241/2016, the Court has issued orders, whereby FCI has
been directed to maintain the status quo with regards to the transfer of members of the petitioner Unions' concerned in those cases.
11.5. Importantly, FCI's counter-affidavit filed in the instant writ petitions alludes to the fact that notifications dated 06.07.2016 and 26.06.2018, are the
subject matter of challenge, not only in W.P.(C)Nos. 7627/2016 and 7241/2016, but also in two other writ petitions i.e., W.P.(C) No. 6192/2016, titled
Food Corporation of India Workers Union vs. Ministry of Labour & Employment & Ors., and W.P.(C) No.4136/2017, titled Bharatiya Khadya Nigam
Shramik Sangathan vs. Food Corporation of India & Ors. It appears that these four writ petitions are being taken up together with W.P.
(C)No.6192/2016 being the lead writ petition [See order dated 26.09.2019, passed by the learned Single Judge in W.P.(C) Nos.7627/2016, 7241/2016
and 4136/2017].
“Learned counsel for the parties jointly submit that the connected petition being W.P.(C) No.6192/2016 which has been directed to be treated as
the lead case is listed on 17.01.2020. They, therefore, pray that the present petitions be also taken up for consideration on the same date. At request,
list on 17.01.2020 along with W.P.(C) No.6192/2016.â€
11.6. Therefore, we had called for the record of W.P.(C) No. 6192/2016, which revealed that by an order dated 03.09.2019, the writ court had
allowed an application for amendment when the second notification was issued, i.e., notification dated 26.06.2018. Thus, in pursuance of this order
when the third notification was issued i.e., notification dated 25.06.2020, the General Secretary of the petitioner-Union in W.P.(C) 6192/2016 filed an
affidavit dated 19.09.2020, bringing on record the said fact. Via this affidavit, leave was sought of the Court to incorporate prayers to assail
notification dated 25.06.2020 on the same grounds [on which previous notifications dated 06.07.2016 and 26.06.2018] stood challenged. The affiant, in
effect, relying upon the reasoning given in the order dated 03.09.2019, sought exemption from moving a formal application to amend the writ petition,
once again. It is not in dispute that the third notification i.e., notification dated 25.06.2020 has a tenure of two years, and will, thus, expire in June 2022.
12. Since the aforementioned three notifications are the subject matter of the writ petitions referred to hereinabove, we do not intend to dwell on them,
which is also the contention of Mrs Acharya.
13. As alluded to hereinabove, FCI has also framed guidelines for implementing the notification dated 06.07.2016. These guidelines form the subject
matter of a document dated 12.07.2016. A perusal of the said document shows that FCI had proposed to GOI that exempt/de-notify depot/railhead,
which stood notified under Section 10 of the CLRA Act. The GOI, instead, issued only an exemption notification under Section 31 of the CLRA Act.
Thus, FCI took recourse to “pooling†its workmen by undertaking inter-depot, inter-district and inter-zone transfers (in exceptional cases). The
guidelines provided that, while undertaking transfers, it had to be ensured that workmen did not move to another labour system. As noticed above,
after 12.07.2016 guidelines, another communication was issued by FCI dated 31.12.2020, to rationalize “labour strengthâ€.
14. Thus, what the record discloses is as follows:
(i) That although FCI made a proposal for exempting/de-notifying depots/railheads, the GOI issued only exemption notifications under Section 31 of
CLRA Act, vis-Ã -vis 226 godowns/depots/railheads, out of a total of 289.
(ii) Even though the Bombay High Court, Nagpur Bench had issued a specific direction to the GOI to de-notify the already notified godowns, depots
and railheads within 6 months, no such steps have been taken.
(iii) The Supreme Court, via interlocutory order dated 08.07.2016, as noticed above, and final order dated 31.07.2017 permitted the FCI Workers’
Union, FCI Shramik Union and FCI Handling Workers’ Union to lay a challenge to the notification issued under Section 31 of the CLRA Act.
(iv) This led to the institution of the aforementioned four writ petitions, out of which three were filed in 2016, while the fourth writ petition was filed in
2017.
(v) As noticed above, status quo order vis-Ã -vis transfer of members of workmen union operates in W.P.(C) Nos. 7627/2016 and 7241/2016. Insofar
as the other two writ petitions are concerned i.e., W.P.(C) Nos.6192/2016 and 4136/2017, status quo was directed to be maintained vis-a-vis
conditions of service of members of petitioners-Unions', via orders dated 02.05.2017, passed in the backdrop of Section 31 notification dated
06.07.2016, and 12.05.2017, respectively.
“C.M. 25364/2016 (for directions)
By way of this application, stay of Notification of 6th July, 2016 exempting the go-down, depots and railhead of Food Corporation of India
under Section 31 of The Contract Labour (Regulation and Abolition) Act, from applicability of notifications of Government of India in
respect of employment of contract labour in different job for a period of two years is sought.
Upon hearing, this application is disposed of with direction that status quo with regard to condition of service in respect of workmen of
petitioner-Union be maintained during pendency of this petition. Application is disposed of.â€
“C.M.18094/2017
Upon hearing, it transpires that in a similar matter i.e. W.P.(C) 6192/2016, it has been directed that status quo regarding the condition of
service of workmen, who are members of petitioner-Union, be maintained during the pendency of this petition.
On parity basis, this application is disposed of with similar direction.â€
(vi) Even though, the FCI has admitted that a Section 10 notification was issued vis-Ã -vis FSD Shakti Nagar, it disputes that any such notification
was issued vis-Ã -vis FSD Mayapuri. The petitioners, who are deployed in FSD Mayapuri, have not filed a rejoinder or placed anything on record, to
establish the contrary.
(vii) Between the date, when Bombay High Court (Nagpur Bench) rendered its decision i.e., 20.11.2015, and FCI framed its guidelines to implement
the exemption notification dated 06.07.2016 i.e., 12.07.2016, FCI had approached the Central Board for lifting the prohibition against employment of
contract labour, vis-Ã -vis 226 depots and railheads. The Central Board, after considering the matter at length in its 88th Meeting, repelled FCI's
request. The FCI, on its part, did not accept the view of the Central Board, which was put on record via its communication dated 13.04.2016.
(viii) A plain reading of the impugned E-Tender Notice No. 04/2021 would show that FCI intended to employ contract labour in FSD Shakti Nagar,
which concededly, is a depot notified under Section 10 of CLRA Act.
15. Given the aforesaid position, the issue that arises for our consideration, as noticed above, is: whether the FCI, in these circumstances, can deploy
contract labour qua a godown/depot, which stands notified under Section 10 of CLRA Act?
15.1. In our view, once a notification under Section 10 is issued by the appropriate Government, qua an establishment, no contract labour can be
employed to carry out any process, operation or other work in such an establishment. It is only the appropriate government, which can lift the
prohibition against employment of contract labour vis-Ã -vis the establishment, qua which a notification under Section 10 of the CLRA Act has been
issued.
15.2. The employer and in this case, FCI, has every right to transfer its employees/workmen for administrative/operational reasons; a directive which
a Court will not, ordinarily, interdict except, inter alia, on the grounds of mala fide or where transfer takes place in violation of provisions of a statute or
statutory rule or regulation. Therefore, while we can have no objection to FCI transferring its employees/workmen for administrative/operational
reasons from one depot to another, this cannot be used as a ruse to deploy contract labour in a godown/depot, which is notified under Section 10 of
CLRA Act.
15.3. Thus, while the court cannot possibly come in the way of the steps taken by FCI to enhance its operational efficiency, we do find it difficult to
accept the proposition put forth by FCI that it can deploy contract labour in notified godowns, depots and railheads, and, thus, queer the pitch for
regular employees in the coming daysâ€"which is, that they are not required to carry out operations in notified depots, inter alia, on the ground of
enhanced efficiency and intermittent work without going through the rigours of the CLRA Act.
15.4. On the same note, one cannot quibble with the proposition that transfer is an incident of service and therefore, is ordinarily not interfered with by
Courts, except where it is imbued with mala fide and is contrary to statutory provisions and policy.
15.5. Therefore, as indicated above, while cannot have any objection to FCI transferring its employees from one depot to the other, we certainly are of
the view that if the trigger for such transfer is the deployment of contract labour in notified godowns, depots and railheadsâ€"only to dilute the
rationale which formed the basis of their notification under section 10 of CLRA Act in the first instance, that cannot be permitted. Such a step, in our
opinion, would be in the teeth of the notifications issued under Section 10 of the CLRA Act as also the directions contained in the judgement dated
20.11.2015, passed by the Bombay High Court (Nagpur Bench).
15.6. FCI, instead of approaching the government for recalling the notification issued under Section 10 of CLRA Act, has taken the route of issuing
the impugned tender notice no.4/2021 dated 01.03.2021 to circumvent the provisions of law.
16. It is, therefore, rightly argued on behalf of the petitioners that FCI is attempting to change the texture and contour of the godown/depot in issue,
which is the subject matter of W.P.(C) 5080/2021 i.e., FSD Shakti Nagar.
16.1. As far as the other godown/depot is concerned i.e., FSD Mayapuri, since FCI has denied that a notification under Section 10 under CLRA Act
has been issued vis-Ã -vis the said depot and fact that the petitioners in W.P.(C) No.6060/2021 have not filed a rejoinder or placed on record material
that would establish that a notification under Section 10 of CLRA Act has been issued, the FCI should be free to take whatever steps it wishes to take
for improving its operations in FSD Mayapuri, albeit as per law, as the reasoning provided for FSD Shakti Nagar would not be applicable in the case of
the former. In other words, what we have observed hereinabove vis-Ã -vis FSD Shakti Nagar would not, perhaps, apply to FSD Mayapuri. However,
this issue, for the moment may have become academic vis-a-vis FSD Mayapuri, as the e-tender notice no.5/2021, which is the subject matter of W.P.
(C) 6060/2021, has been withdrawn by FCI.
17. Insofar as the submission made by FCI, that the petitioner should have taken recourse to the provisions of ID Act to assail the impugned e-tender
notices is concerned, the same, to our minds, is misconceived for the reason that challenge to impugned e-tender notices would not be available under
the ID Act. As noticed above, this argument was, in fact, not articulated during the hearing.
18. As regards decisions rendered by other High Courts, on which reliance is placed by FCI, we are of the view that in none of the cases, the crucial
fact which obtains in the instant matter i.e., W.P.(C) No. 5080/2021, which is deployment of contract labour in a godown/depot notified under Section
10 of CLRA Act, has arisen for consideration.
19. To our minds, the objection raised concerning locus standi of the petitioners is also not sustainable, since the petitioners before us are members of
the Workers Unions, which have laid challenge to the exemption notifications, issued under Section 31 of the CLRA Act.
Conclusion
20. Therefore, for the foregoing reasons:
(i) E-Tender Notice No. 4 of 2021, which is the subject matter of W.P.(C) No. 5080/2021, is quashed.
(ii) Since E-Tender Notice No. 5 of 2021, which is assailed in W.P.(C) No. 6060/2021, has been recalled, no operative directions are required to be
issued in the said writ petition.
(iii) Thus, while FCI would be free to transfer its employees/workmen from FSD Shakti Nagar, it cannot supplant the transferred workmen with
contract labour, till such time the notification under Section 10 of the CLRA Act remains operable. Exemption notifications under Section 31 of the
very same Act, which are temporary, issued for an emergent purpose, cannot dilute the rigour of a Section 10 notification.
(iv) It is also made clear that, insofar as the challenge to the aforementioned exemption notifications issued under Section 31 of the CLRA Act are
concerned i.e., 06.07.2016, and 26.06.2018 [and proposed challenge to the notification dated 25.06.2020] is involved, the rights and contentions of the
parties in the aforesaid writ petitions will not be impacted by any of the observations made hereinabove, as the legal tenability of those notifications has
not been examined by us.
(v) Since 12.07.2016 guidelines have been framed to implement the notification dated 06.07.2016, issued under Section 31 of the CLRA Act, and the
said notification has been assailed in W.P.(C) Nos.7241/2016 and 7627/2016, we desist from ruling on it, as it may impact the pending litigation. The
same position would obtain, vis-Ã -vis communication dated 31.12.2020, issued by FCI, as it takes forward the theme contained in the 12.07.2016
guidelines.
21. The above-captioned writ petitions are disposed of, in the aforesaid terms. Consequently, pending applications shall also stand closed.
22. There shall be no order as to costs.
