judgement:
s (C) Nos.
2275 86 of 1982 Etc.
(Under Article 32 of the Constitution of India) WITH Special Leave Petition (C) No. 4090 of 1985.
From the Judgment and Order dated 4.12.
1984 of the Madras High Court in W.A. No. 414/78.
B. Datta, Additional Solicitor General, G. Ramaswamy, Additional Solicitor General, M.K. Ramamurthy, V.M. Tar kunde, Gobind Mukhoty, S.C. Manchanda, G.B. Pai, K.K. Venug opal, Mrs. Shyamala Pappu, M.A. Krishnamurthy, Ms. Chandan Ramamurthy, J.D. Jain, MS.
Kanwaljit Kochhar, K.B. Rohtagi, B.R. Agarwala, Ms. Sushma Manchanda, R.B. Hathikhanwala, Ms. Sunita Sharma, P.H. Parekh, S.S. Khanduja, Y.P. Dhingra, B.K. Saluja, H.S. Parihar, Vipin Chandra, R.K. Maheshwari, Pramod Dayal, R.P. Saxena, D.K. Garg, A.D. Sanger, Pramod Swarup, Krishna Prasad, P.C. Kapur, A.N. Badriyar, M.P. Jha, V.N. Sharma Petitioner inperson, B.B. Sahoo, section Srinivasan, Vineet Kumar, Ms. Urmila Kapoor, Ms. section Janani, Dalveer Bhandari, C. Ramesh, G.D. Gupta, L.K. Gupta, G. Venkatesh Rao, Ms. A. Subhashini, Ms. Sushma Suri, C.V. Subba Rao, P. Parmeshwaran, J.R. Das, S.K. Patri, Ms. Lira 692 Goswami, D.N. Mishra, V.J. Francis, N.M. PopIi, S.K. Dhin gra, K.J. John, Y.P. Rao, Mahabir Singh, Ms. Bharti Anand, Indra Makwana and S.K. Jain for the appearing parties.
The Judgment of the Court was delivered by SAWANT, J.
This group of petitions concerns the workers in canteens run in the different railway establishments.
The relief claimed in all the petitions is that the workers concerned should be treated as railway employees and should be extended all service conditions which are available to the railway employees.
For our purpose, these canteens have to be classified into three categories, viz. (i) Statutory Canteens These are canteens required to be provided compulsorily in view of the provisions of Section 46 of the (hereinafter referred to as the Act) since the Act admitted ly applies to the establishments concerned and the employees working in the said establishments exceed 250; (ii) Non Statutory Recognised Canteens These canteens are run in the establishments which may or may not be governed by the Act but which admittedly employ 250 or less than 250 employees, and hence, it is not obligatory on the railways to maintain them.
However, they have been set up as a staff welfare measure where the employees exceed 100 in number.
These canteens are established with the prior approval and recog nition of the Railway Board as per the procedure detailed in the Railway Establishment Manual; and (iii) Non Statutory Non Recognised Canteens These canteens are run at estab lishments in category (ii) above but employ 100 or less than 100 employees, and are established without the prior approv al or recognition of the Railway Board 3.
The present petitions concern employees in all the three types of canteens.
It will be convenient to deal separately with the employees in the three types of can teens, because, the history of litigation and the arguments advanced in respect of each of the categories are different.
4.(i) Statutory Canteens: Section 46 of the Act which makes it obligatory on an occupier of a factory as defined under the Act, to provide a canteen or canteens where more than 250 workers are ordinarily employed runs as follows: "Canteens: (1) The State Government may make rules 693 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 the use of the workers.
(2) Without prejudice to the generality of the foregoing power, such rules may provide for (a) the date by which such canteen shall be provided; (b) the standards in respect of construction, accommodation, furniture and other equipment of the canteen; (c) the foodstuffs to be served therein and the charges which may be made therefore; (d) the constitution of a managing committee for the canteen and representation of the workers in the management of the canteen; (dd) the items of expenditure in the running of the canteen which are not to be taken into account in fixing the cost of foodstuff and which shall be borne by the employer; (e) the delegation to the Chief Inspector, subject to such conditions as may be prescribed, of the power to make rules under clause (c).
" It is evident from the aforesaid provision that the occupier of a factory (a railway establishment for the purposes of the said provisions is a factory within the meaning of the Act) is not only obliged to run a canteen where more than 250 workers are employed but is also obliged to abide by the rules which the concerned Government may make, including the rules for constitution of a managing committee for running the canteen and for representation of the workers in the management of the canteen.
The occupier may also be required to bear a part of the expenses of running the canteen and to comply with the rules prescribing standards in respect of construction, accommodation, furniture and other equipment of the canteen the foodstuffs to be served and the prices to be charged for them.
In other words, the whole paraphernalia of the canteen has to conform to the statutory rules made in that behalf.
As is pointed out on behalf of the Railways, it appears that there are 89 such statutory canteens function ing in the railway premises.
694 5.
It appears that the workers working in the statutory canteen at Loco Carriages and Electrical Workshops of the South Eastern Railways Workshop, Kharagpur had preferred a writ petition in the Calcutta High Court praying for a direction to the Union of India to recognise them as railway employees and grant them a11 service conditions available to the railway employees.
A learned Single Judge by his deci sion dated 7.8.
1973 dismissed the said petition holding that the workers were not entitled to the reliefs claimed by them.
Against the said decision, the workers preferred an appeal before the Division Bench of the said Court and the Division Bench by its decision of July 16, 1974, allowed the same and directed the respondent Union of India to recognise the workers as employees of the Railway Administration under the , but rejected the demand to pay salary and allowances to them as if they were railway employees.
On the other hand, the High Court held that the employment of the workers must be deemed to be on the basis of appointment letters and that they had no statutory or legal right and the Railway Administration had no corresponding statutory or legal obligation to pay salaries etc.
above the minimum wages, or dearness allowances as claimed by them.
The court held that their service conditions were in the realm of contract or depending on a policy followed by the Railway Administration, at its discretion.
Being aggrieved, the Union of India had come in appeal to this Court being Civil Appeal No. 368 of 1978.This Court by its order of October 22, 1980 disposed of the appeal as follows: "The benefits accruing to the workers under the decision of the Calcutta High Court do not require to be interfered with in this appeal.
Prima facie we are inclined to agree that the High Court decision is right.
Moreover, the learned Attorney General agrees to apply the Act as if it were applicable to canteen employees.
In this view, a final pronouncement on this question by this Court need not be given in the present case.
We leave it open to Union of India in an appropriate case to raise the point and seek a pronouncement.
" The Act referred to in the aforesaid order obviously means the .
Therefore, what was confirmed by this Court was the declaration given by the Calcutta High Court that the employees of the Statutory Canteens were railway.employees for the purposes of the and that their service conditions were determined by the con tract as incorporated in their appointment letters or by the policy decision of the Railway Administration which was discretionary.
It is 695 necessary to note this fact at the very outset.
It has further to be remembered that the Calcutta High Court had given the aforesaid declaration in favour of the statutory canteen workers notwithstanding the fact that the canteens were managed by the Committee of Management nomi nated by the Railway Administration or by a managing commit tee elected or nominated by the employees or by the Corpera tive Society relying on the express provision contained in Chapter XXVIII` Of 'the Railway Establishment Manual.
It may, however, be mentioned that the High Court had taken into consideration Note 2 of Para 2834(2) of the Manual which had declared that in cases where the canteens were being run on cooperative basis either by the Co operative Society or the managing committee of the staff, the canteen staff shall not be treated as railway servants because in that case master and servant relationship existed between the Co operative Society (through its managing committee) and the concerned employees.
The High Court had relied upon the fact that even in such cases the entire cost of the staff was reimbursed by the Railway Administration to the Co operative Society managing committee and that over all control over the canteen and the staff, vested in the Rail way Administration.
In fact, the direction under para 2832 of the Railway Establishment Manual was that where even a Co operative Society was running the canteen, the bye laws of the Society should be suitably amended to provide for such overall control by the Railway Administration since the legal responsibility for the proper management of the can teen vested not with the agent like the Co operative Soceity but solely with the Railway Administration.
6. 1t is undoubtedly true, however, that this Court in its Order dated October 22, 1980 had reserved the right to the Union of India to raise the question as to whether the employees of the Statutory canteens were the employees of the Railway Establishment, finder the and get a pronouncement on the same.
It appears that after the said order of this Court, the Railway Board had issued a letter dated May 22, 1981 to the General Manager, South Eastern Railway, Calcutta Conveying the decision of the Ministry of the Railways that the employees of Kharagpur Workshop Statu tory Canteen, (which employees were a party to the said decision) should be deemed to be railway servants with effect from October 22, 1980 and till Government decided otherwise, the said workers would continue to be governed by the conditions of service and emoluments as existed on October 21, 1980.
It was also stated there that what was stated in the letter had the sanction of the President and the letter was issued/with 696 the concurrence of the Finance Directorate of the Ministry of Railways.
Subsequently, the Board issued another circular letter of June 8, 1981 addressed to the General Managers of all Indian Railways stating therein that it was decided that employees of all other statutory canteens on the railways irrespective of the type and management of the canteens should also be deemed to be railway servants w.e.f. October 22, 1980 and that till Government decided otherwise, the staff of the statutory canteens would continue to be gov erned by the conditions of service and emoluments as existed on October 21, 1980.
On March 11, 1982, the Railway Board issued a letter and referred to its earlier communication of June 8, 1981 and September 18, 1981.
In this, letter, it was stated that pursuant to the said two earlier communications (where it was stated that the question of pay scale and retirement benefits were under consideration and that a separate commu nication would follow), a Schedule showing revised pay scale applicable to the employees of the statutory canteens of the railways was enclosed for necessary action.
The letter stated that the existing employees of these canteens would be entitled to exercise an option under Rule 2019 (F.R. 23) and Rule II either to retain their existing pay scale as presently applicable to them or opt for the revised pay scale.
However, on promotion such employees would be compul sorily brought on to the revised pay scales.
It was made clear that those who opt for the revised scales would not be eligible to other facilities/perquisites admissible to them in their existing pay scale such as free food, snacks, commission etc.
A period of three months was given for exercising the option and it was stated that if no option was exercised it would be assumed that the employees con cerned had elected to be governed by the revised pay scales w.e.f. October 22, 1980.
The Schedule annexed to the letter mentioned, among other things, that the canteen employees will be entitled to the dearness allowance, house rent allowance and city compensatory allowance as per the in structions issued by the Railway Ministry; that the age of retirement of employees would be 58 years as in the case of other railway employees; and that the employees of the canteen would be entitled to the benefit of productivity linked bonus on the principles applicable to the stall of the office/establishment to which they were attached from the date of their being declared as railway servants.
In a decision of this Court reported in ; , this Court directed that for the purpose of calculating pensionary benefits, the service rendered by the said em ployees prior to October 22, 1980 should also be computed.
By its letterr dated May 13, 1983 addressed to 697 all the General Managers, the Ministry of Railways placed on record the fact that pursuant to the Order of this Court dated October 22, 1980 the employees of all the statutory and 11 Delhi based nonstatutory canteens had been treated as railway servants w.e.f. October 22, 1980, and the revised pay scale applicable to the employees had been communicated vide the Railway Board 's letter dated March 11, 1982.
On December 4, 1984, a Division Bench of the Madras High Court delivered a Judgment in Writ Appeal No. 414 of 1978, Railway Board & Anr.
vs Parthasarthy and Anr., and in Writ Appeal No. 415 of 1978 relying upon the order dated October 22, 1980, passed by this Court and held that can teen employees will have to be treated as railway employees for the purposes of the , in view of th, con cession made by the Railways before this Court and also the con cession made by the counsel appearing for the Railways before the High Court.
We have then on record an Office Order dated July 27, 1983 issued to an employee of a statutory canteen con veying to him appointment as a TY/Cleaner in a scale of pay plus usual allowances w.e.f.
January 12, 1983.
In this order, it is stated that the employee would be eligible for house rent allowance under the Rules in force from time to time, that he will be on probation for a period of one year and that the appointment would be terminated with 14 days ' notice on either side.
It is, however, added that no such notice would be required, for the termination of service as and by way of removal or dismissal as a disciplinary measure effected after compliance with the provisions of clause (2) of Article 311 of the Constitution of India.
It is also stated that the employee should take oath of allegiance to the Union of India and that he should apply for allotment of quarters within 7 days from the date of his appointment and then alone should apply for house rent allowance.
It is now necessary to refer to the relevant provi sions of the Railway Establishment Manual which deal with the canteens.
Paragraph 2829 of Chapter XXVIII of the Manual refers to the provisions of Section 46 of the and underwrites the fact that under these provisions, there is a statutory obligation on the Railway Administra tion to set up canteens in Railway establishments which are governed by the said Act and which employ more than 250 persons.
The paragraph further mentions that Railway Admin istration should strictly abide by the rules which are framed by the respective State 698 Governments under sub section 2 of the Act regarding the constitution of the Managing Committees of such canteens.
Paragraph 2832 then ordains that the staff served by the said canteens should be actively associated in their manage ment, and for this purpose a Committee of management of the staff should be formed in accordance with the rules framed by the concerned State Government.
The paragraph further states that although the Administration can employ as agent a Staff Committee or a Co operative Society for management, the legal responsibility for proper management rests not with the agency but solely with the Railway Administration.
In case the management is entrusted to a consumer co opera tive society the bye laws of the society are directed by the said paragraph to be amended suitably to provide for an overall control by the Railway Administration.
Paragraph 2834 deals with the incidence of cost of the canteens.
As regards the statutory canteens, the paragraph directs that in addition to the facilities which are given to the non statutory canteens, the Administration will have also to bear the expenditure on the entire paraphernalia including the furniture as well as the salaries of the cook and the canteen staff.
Note 2 of the said paragraph then states that where the canteens are being run on co operative basis either by co operative society or by Managing Committee of the staff and there subsists a relationship of master and servants between the society/ managing committee and the workers, i.e. where the canteen staff has been employed by the society/managing committee and not by the Administration as such, the canteen staff are not to be treated as railway servant even though the cost of this staff is reimbursed by the Administration.
We have also on record the second edition (1988) of "ADMINISTRATIVE INSTRUCTIONS ON DEPARTMENTAL CANTEENS IN OFFICES AND INDUSTRIAL ESTABLISHMENTS OF THE GOVERNMENT" issued by the the Deptt.
of Personnel & Training, Ministry of Personnel, Public Grievances & Pensions of the Govt.
of India, first published in 1980 (hereinafter briefly called as the Instructions).
They are applicable to: (a) Canteens/Tiffin Rooms set up on departmental basis and run as per scheme issued by the Deptt.
of Personnel and Training; (b) Canteens/Tiffin Rooms set up on Co operative basis by a Society of Government employees with the Head of the Deptt./ Office/Establishment or his nominee as Chairman; and (c) Canteens/Tiffin Rooms set up in Industrial Establish ments 699 (other than those covered under Section 46 of the ) of the Government and which have not been exempted from following the rules in the said Instructions due to the availability of a separate and distinct set of rules and guidelines framed by the controlling Ministries/Departments.
(para 1.3) It is made clear in these Instructions that the orders issued under the said Instructions are applicable to all Canteens/Tiffin Rooms functioning or to be set up in any Ministry, Department, Establishment, Office, Installation of the Government of India (industrial or nonindustrial) which should be centrally registered with the office of the Direc tor of Canteens, Deptt.
of Personnel & Training, New Delhi including those functioning under the Ministries of Defence, P & T and Railways, unless these three Ministries had previ ously decided to exempt any of their Canteens/Tiffin Rooms from the purview of the said Instructions due to specific reasons, and they had framed or they propose to frame a separate set of instructions for the exempted canteens.
(para 1.4).
The Instructions further state that the policy matters and coordination on canteen matters will be central ly done by the Deptt.
of Personnel and Training (Director of Canteens) (para 1.14).
To be entitled to subsidy all the departmental canteens have to get themselves registered centrally with the Director of Canteens and Training (Para 1.15).
The canteens are entitled to subsidy on wages and gratuity payable to the workers employed in the canteens and for their uniforms as well as to capital and replacement grants for equipment including utensils, crockeries, cutt lery and furniture and also to interest free loans.
In addition to subsidy for equipment, the canteens are also entitled to other facilities such as accommodation on nomi nal rent of Rs. 1 electricity, water etc.
The Instructions in terms state that since the canteens are run departmental ly as a measure of staff welfare, the beverages, snacks and meals etc.
have to be made available to the staff at econom ic rates and for this purpose the Government has to provide necessary accommodation at the nominal rent and provide the necessary grants, subsidy and loans.
(Para 1.2).
In, addi tion, the concerned Department/Office has to bear the elec tricity and water bills.
In chapter V which deals with the personnel in the canteens, the Instructions lay down the entitlement of Canteens/Tiffin Rooms to the number and categories of employees according to the grades of Canteens/Tiffin Rooms.
With regard to the recruitment rules, conditions of service, status and the scales of pay of the canteen workers, the procedure for taking disciplinary action against them as well as for giving training to them, the chapter makes it clear that since the canteen workers have acquired the status of the holders of civil posts 700 w.e.f. October 1, 1979, their recruitment and conditions of service etc.
would be governed by the rules framed under proviso to Article 309 of the Constitution contained in GSR 54 issued under Government of India, Department of Personnel and Training Notification dated 23rd December, 1980.
It is made clear that the said rules also apply to the employees of the Canteens run by the Co operative Societies in con junction with the bye laws of the Society and local co operative laws in force.
It is further made clear that the workers in the non statutory departmental and co operative Canteens/Tiffin Rooms will be paid the pay and allowances at the same rate and on the same basis w.e.f. 26.9.
83 on which the employees of the statutory canteens are paid the same.
The chapter also mentions that before taking any disci plinary action against any canteen worker procedure as set out in chapter IV (Conduct and Discipline) of GSR of 1954 dated 23rd December, 1980 published in the Gazette of India Part II Section 3, sub Section (1) dated 17th January, 1981 will be followed.
The chapter further directs periodical training programmes to be arranged by the Director of Can teens for managerial, personnel and other canteen staff.
Chapter VI contains guidelines for constituting the Managing Committees of the canteens.
This chapter ordains that the Chairman of the managing committee should prefera bly be the Head of the Department/Office himself or his Deputy, and that the Honorary Secretary of the managing committee should normally be the Welfare Officer or the Administrative Officer of the Department/ Office of the minimum rank of a Section Officer or a Major or equivalent in services, who shall be nominated by the Office/Establish ment, and in the case of Co operative Canteens may be elect ed as per the bye laws of the Society.
One of the officials who should be of the rank of Section Officer/Major or above is to be nominated on the managing Committee by the Chair man.
Paragraph 6.11 defines the Legal Status of the Managing Committee.
It says that the Committee functions in the Deptt./Office/establishment of the Government of India for the welfare of the Govt.
employees, under the orders of the Government of India and its functions are connected with the affairs of the Union.
The Committee, therefore does not enjoy an autonomous status.
With respect to the contractual obligations, it functions "for and on behalf of the the President of India".
The proceedings of the Committee will not be conducted or decided on resolutions or voting system, but the official decision will rest with the Chairman of the Managing Commitsee or the Head of the Department/Office.
In the case of canteens run by the co operative societies, this provision is to apply as per the 701 bye laws of the society and the co operative law in force.
The presence of the Chairman and the Hony.
Secretary is necessary to constitute the quorum for holding the meeting of the Managing Committee.
The Head of the Department/Office is given power to depute a Government servant of the rank of Section Officer/equivalent or below if he can be spared, for part time or whole time assistance to the Managing Commit tee.
The Department/Office concerned is required to provide stationery, stencils, cyclostyling facilities, postage stamps, office assistance etc.
to enable the Managing Com mittee to conduct its business.
The annual accounts of the Canteens have to be submitted to the Financial Advisers of the Department/Office concerned with copies thereof to the Director of the can teens, and the audit of the accounts of the Canteens/Tiffin Rooms is to be carried out by the Departmentalised Accounts Organisations of the concerned Ministries/Departments/Of fices.
Out of the surplus of net profits of the Canteens, 1/3 amount is required to be remitted to the Director of Canteens Funds for welfare of the canteen employees in general.
All the aforesaid provisions apply to all types of Tiffin Rooms classified into Type B and A where the strength of the Department/Office is between 25 49 and 50 99 respec tively and to the Canteens classified in Types D, C, B and A where the strength is between 100 249, 250 499, 500 699 and 700 1200 respectively.
Where the strength is above 1200 a further higher classification is given to the Canteens.
These provisions contained in the Instructions, therefore, show that the Government has a complete control over the canteens and the workers employed therein are holders of civil posts within the meaning of Article 311 of the Constitution.
Their recruitment and service conditions are governed by the rules applicable to the employees of the Government Deptt./Office/Establishment to which the canteens are attached.
It is against this background that we have to con sider the question as to whether the staff employed in the statutory canteens m ' the Railway Establishment, industrial or non industrial, are railway employees or not.
According to the workers, in view of the aforesaid documents on record there is no reason why the employees in the canteens con cerned should not be given the status of the railway employ ees with all consequential benefits.
On the other hand, the 702 contention advanced on behalf of the Railways is that the documents in question show that the employees of the statu tory canteens are to be deemed railway employees only for the purpose of the and for no other purpose.
In no case, they can be deemed as holders of civil posts either for Article 309 or for Article 311 or for any other purpose.
On behalf of the employees, a preliminary objection was raised, namely, that in view of the order of this Court dated October 22, 1980 in Civil Appeal No. 368 of 1978 and another, it is not open to the Railways to agitate the question whether the employees in the statutory canteens are railway employees or not, and further whether they are railway employees for the purposes of the .
We are not inclined to entertain this objection for it is clear from the said order that the Court had left open even the question as to whether the employees of the statutory can teens were railway employees for the purposes of the said Act.
Hence, the question whether they are employees of the railways for all purposes necessarily remains res integra.
We may reproduce here the said order which is clear enough on the subject: "The benefits accruing to the workers under the decision of the Calcutta High Court do not require to be interfered with in this appeal.
Prima facie we are inclined to agree that the High Court decision is right.
Moreover, the learned Attorney General agrees to apply the Act as if it were applicable to canteen employees.
In this view a final pronouncement on this question by this Court need not be given in the present case.
We leave it open to the Union of India in an appropriate case to raise the point and seek a pronouncement.
Leave granted in the petition flied by Railway Canteen Karmachari Association.
We have in C.A. No. 368 of 1978 passed an order and the point raised by the workmen in this appeal closely resembles the one raised in the sister case just referred to.
We apply the same principle as has been decided by the Calcutta High Court to this case also and the workmen will be given the same benefits.
We, however, make it clear here also that the Union of India will be free in an appopriate case to challenge the correctness of the legal point 703 decided by the Calcutta High Court.
It will be equaly open to the workmen to challenge the decision of the Delhi High Court if it becomes necessary.
With these observations we dispose of both the appeals.
The appellants in C.A. No. 368/1978 will pay the costs of the respondents.
" It must be remembered in this connection that both the Calcutta and the Madras High Courts had taken the view that the employees in the statutory canteens were the employees of the Railways for the purposes of the said Act.
The Delhi High Court had distinguished the decision of the Calcutta High Court on the ground that, that decision did not apply to the employees in the non statutory canteens with which it was concerned, and had held that the employees of the non statutory canteens were not railway employees for any pur pose.
It is in this circumstance that this Court had given liberty to the Railway Administration as well as the employ ees to challenge the respective decisions of the Calcutta and Delhi High Courts.
It will not, therefore, be correct to say that this Court had pronounced its final opinion on the said issue by the said order.
It has also to be remembered in this connection that the issue before this Court in those matters was whether the employees either of the statutory or non statutory canteens were the railway employees for the purposes of the .
The larger issue whether they were railway employees for all purposes was neither dis cussed nor even tentatively decided in those proceedings.
We are, therefore, of the view that both the said issues are at large in the case of the employees of the statutory as well as of the non statutory canteens.
Before us therefore two issues arise for considera tion, viz. (a) whether the employees of the statutory can teens are railway employes for the purposes of the said Act? and (b) whether they are railway employees for all other purposes as well? 20.
As regards the first contention, namely, whether the said employees are the employees of the Railway Administra tion for the purposes of the said Act, according to us the view taken by the Calcutta High Court in that behalf is correct.
Section 2(1) of the defines "worker" as follows: "Worker" means a person employed, directly or through any agency (including a contractor) with or without the knowl edge of the principal employer, whether for remuneration or not in any manufacturing process or in 704 cleaning any part of the machinery or premises used for a manufacturing process, or in any other kind of work inciden tal to, or connected with, the manufacturing process, or the subject of the manufacturing process but does not include any member of the armed forces of the Union;" Since in terms of the Rules made by the State Govern ments under Section 46 of the Act, it is obligatory on the Railway Administration to provide a canteen, and the can teens in question have been established pursuant to the said provision there is no difficulty in holding that the can teens are incidental to or connected with the manufacturing process or the subject of the manufacturing process.
The provision of the canteen is deemed by the statute as a necessary concomitant of the manufacturing activity.
Para graph 2829 of the Railway Establishment Manual recognises the obligation on the Railway Administration created by the Act and as pointed out earlier paragraph 2834 makes provi sion for meeting the cost of the canteens.
Paragraph 2832 acknowledges that although the Railway Administration may employ anyone such as a Staff Committee or a Co operative Society for the management of the canteens, the legal re sponsibility for the proper management rests not with such agency but solely with the Railway Administration.
If the management of the canteen is handed over to a consumer cooperative society the bye laws of such society have to be amended suitably to provide for an overall control by the Railway Administration.
In fact as has been pointed out earlier the Adminis trative Instructions on departmental canteens in terms state that even those canteens which are not governed by the said Act have to be under a complete administrative control of the concerned Department and the recruitment, service condi tions and the disciplinary proceedings to be taken against the employees have to be taken according to the rules made in that behalf by the said Department.
In the circumstances, even where the employees are appointed by the Staff Commit tee/ Cooperative Society it will have to be held that their appointment is made by the Department through the agency of the Committee/ Society as the case may be.
In addition, as stated earlier, the Railway Board by its circular dated June 8, 1981 had communicated that it was decided to treat the employees of all statutory canteens, as railway servants irrespective of the type and management of the canteens, and to extend to them the conditions of service and emoluments of the railway servants as existed on October 21, 1980, w.e.f.
22nd October 1980.
No doubt it was stated in this letter that the said decision would 705 prevail till Government decided otherwise.
Subsequently on March 11, 1982, the Board also prescribed the pay scales, dearness allowance, house rent allowance, city compensatory allowance and productivity bonus, and fixed the age of their superannuation.
As also pointed out earlier, this court in its decision reported in ; , subsequently directed that for the purpose of calculating pensionary benefits the service rendered by the said employees prior to October 22, 1980 would be computed.
What is further, the Ministry of Railways by its letter of May 13, 1983 placed on record the fact that not only the employees of all the statutory canteens but the employees of eleven Delhi based non statutory canteens had been treated as railway servants with effect from October 22, 1980.
It must be remembered in this connection that neither the Railway Ministry nor the Railway Board had stated in their letters/orders that the employees of the statutory canteens and of the eleven Delhi based non statutory canteens were being treated as railway servants only for the purposes of the or that they were to be so treated till further decision of this Court.
It is possible to place a liberal construction on these letters/ orders and interprete the relevant direction name ly, "till further directions from the Government" as being the directions after the decision of this Court in the present matters, and for the sake of argument we may proceed on that basis while dealing with the present contention.
The admitted facts, however, are that these canteens have been in existence at their respective places continuously for a number of years.
The premises as well as the entire para phernalia for the canteens is provided by the Railway Admin istration and belong to it.
The employees engaged in the canteens have also been in service uninterruptedly for many years.
Their wages are reimbursed in full by the Rly.
Admin istration.
The entire running of the canteens including the work of the employees is subject to the supervision and control of the agency of the Railway Admn.
whether the Agency is the staff committee or the society.
In fact, as stated by the Rly.
Administration in its Establishment Manual the legal responsibility for running the canteen ultimately rests with it, whatever the agency that may intervene.
The number and the category of the staff engaged in the canteen is strictly controlled by the Administration.
As has been pointed out earlier, much before the order of this Court dated October 22, 1980, the employees of the departmental canteens/tiffin rooms were declared as holders of civil posts under the Government of India Notification No. 6(2)/23/77 Welfare dated December 11, 1979 which notifi cation is an annexure 4 to the Administrative Instructions 706 referred to above.
That notification stated that all posts in the said canteens/tiffin rooms are to be treated as posts in connection with the affairs of the Union, and according ly, present and future incumbents of such posts would quali fy as holders of civil posts under the Central Government.
The notification further stated that necessary rules govern ing the conditions of service of the employees would be framed under proviso to Article 309 of the Constitution to have retrospective effect from October 1, 1979.
Accordingly the service rules were framed under Article 309 as per the Notification No. GSR 54 issued by the Govt.
of India, Deptt.
of Personnel & Training on December 23, 1980.
These rules contained both the recruitment rules and conditions of service of the said employees including the procedure for disciplinary action to be taken against them.
As stated earlier the Administrative Instructions are applicable to the canteens/tiffin rooms run by all the Ministries includ ing the Railway Ministry unless they had previously decided to be exempt from them and had framed their own rules in that behalf.
On behalf of the respondents, one Shri Sud, Joint Director of Establishment, Ministry of Railways has filed an affidavit contending that Section F of Chapter XXVIII of the Railway Establishment Manual (to the relevant paragraphs of which we have made a reference earlier) con tains the necessary instructions for running the canteens and hence the Railway Administration should be deemed to have been exempted from the operation of the said Adminis trative Instructions.
Although there is nothing expressly on record to show that the railway canteens are exempted from the said Instructions, we will proceed on the assumption that they are so exempted by virtue of the relevant provi sions of the Railway Manual.
But the fact remains that there are as yet no notifications on the lines of December 11, 1979 and December 23, 1980 issued for the benefit of the employees in the railway canteens.
Whatever the differences in the nature of work performed by the order staff in the different Ministries, it cannot be argued that there is any difference in the work performed by the employees in the canteens run in the establishments of the Ministries.
Hence, we are of the view that if the said two notifications are applicable to the employees in the canteens run by the other departments of the Government of India, there is no reason why the same should not apply also to the employees in the canteens run by the Railways.
On behalf of the Railway Admn.
no material has been placed before us to treat the employees in their canteens as a class separate from the employees in the canteens run by the other departments of the Government.
In the circumstances, it would be highly discriminatory not to apply the said two notification to the employees in the Railway canteens.
It would be violative of Articles 14 and 16 of 707 the Constitution.
We are, therefore, of the view that the employees in the statutory canteens of the Railways will have to be treated as Railway servants.
Thus the relationship of employer and employee stands created between the Railway Administration and the canteen employees from the very inception.
Hence, it cannot be gainsaid that for the purposes of the the employees in the statutory canteens are the employees of the Railways.
The decision of the Calcutta and Madras High Courts (supra) on the point, therefore, are both proper and valid.
The next question is whether the said employees are railway employees for all purposes.
Mr. Ramaswamy, the learned counsel appearing for the Railways contended that the Railways undertake varied welfare activities in the nature of handicrafts centres, cooperative stores, banks, housing societies, credit societies, educational institu tions etc.
and the Railways spend about a hundred crores annually on these activities.
He submitted that if it is decided to treat the employees engaged in the canteens as railway employees it will be difficult to resist the claim from employees of these other institutions numbering over 27,500 for a similar status.
He also submitted that the Railways provide financial assistance to various non Railway institutions such as non Railway schools.
But teachers and other employees working in these schools are the employees of the respective organisations and cannot be treated as railway servants.
Since, according to him, the canteens are run for the benefit of the staff, the Government has only a general responsibility to see that the labour laws are properly followed and not infringed.
He further submitted that an indentical responsibility also devolves on the Railways in regard to contractors who execute works for the Railways with their own labour.
In addition, the Railways have nearly 2.3 lakh casual labourers who are normally employed on works which are of seasonal nature, intermitant or extending over short periods.
These employees are engaged by the contractor to whom the execution of work is entrust ed.
In case the employees of the canteens are to be treated as Railway servants, similar demands will be made from such casual labourers.
His next contention in this behalf was that the Railways have a primary objective of carrying goods and passengers, and the welfare activities are ancillary to the main objective.
Hence, the canteens continue at the discretion of the Railway Administration where there have provided 70% subsidy to the management of the statutory canteens.
If at any stage the Government so decides, it can change the form of this welfare measure 708 and may choose to have another set up which in their view may prove more convenient and financially workable such as engaging a contractor or an established agency like Tea Boad, Coffee Board, Women 's Organisation, etc.
to run the canteens.
For all these reasons, he submitted the employees in the statutory canteens should not be treated as the Railway employees.
While discussing above the contention that the employees in the statutory canteens cannot be treated as Railway employees even for the purposes of the said Act, we have referred to the various developments, and documents on record including the court decisions.
It is not necessary to repeat them here.
In view of the same, the contention ad vanced by Mr. Ramaswamy that the Railway Admn.
is engaged in varied welfare activities, and the employees engaged in these activities will also have to be treated as Railway employees, in case, the canteen employees are recognised as Railway employees does not appeal to us.
We express no opinion on the subject as to whether the employees engaged in other welfare activities will or will not be entitled to the status of the Railway employees, since neither they nor the facts pertaining to them are before us.
Our conclusion that the employees in the statutory canteens are entitled to succeed in their claim is based purely on facts peculiar to them as discussed above.
If by virtue of all these facts that they are entitled to the status of Railway employees and they cannot be deprived of that status merely because some other employees similarly or dis similarly situated may also claim the same status.
The argument to say the least can only be discribed as one in terroram, and as any other argument of the kind has to be disregarded.
(ii) Non Statutory Recognised Canteens: Paragraph 2830 of the Railway Established Manual enjoins upon the Rly.
Administration to take steps to develop their canteen organ isation to the maximum possible extent as a measure of staff welfare preferably by encouraging the development of can teens for staff on co operative basis.
This injunction is for provision of canteens in addition to the canteens as required by the for which provision is made in paragraph 2829 of the said Manual.
Paragraph 2831 lays down the principles governing the setting up of the canteens which apply also to the nonstatutory canteens provided for under paragraph 2830.
It says, among others things, that a regular canteen should be provided where the strength of the staff is 100 or more and a scheme for provision of a new canteen should be submitted to the Railway Board for approv al indicating financial implications duly vetted by the F.A.C.O. Paragraph 709 2833 contains provisions for the management of such non statutory canteens.
Among other things, it states that such canteens can be run either by a Committee of Management to be formed for the purpose or by a Consumer Cooperative Society.
The Committee of Management should consist of the duly elected representatives of the staff and where it is run by a Cooperative Society, it should consist of the representatives of the share holders of the Society.
Howev er, in either of the cases, a representative of the Railway Administration is to be nominated either as a Chairman or a Secretary or as a Member of the Committee.
This nominee of the Railway Administration is under an obligation to bring to the notice of the Administration any decision of the Managing Commttee which is likely to affect the interests of the Railway Admn.
in its capacity as an owner of the prem ises and of the furniture, equipment, etc., or if the deci sion is likely to be of considerable harm to the staff.
In such cases, the Management Committee cannot take action on the particular decision till the General Manager of the Railway has recorded his decision thereon.
The paragraph further ordains that where the canteens are managed by a co operative society, the society should make a suitable provisions in its bye laws for supervision of the canteen by the Committee of Management.
The paragraph also makes provi sion for granting loans to such canteens as initial capital from the Staff Benefit Fund.
Paragraph 2834 then details various facilities which are extended to such canteens which include the necessary accommodation, sanitary and 'electric installations, furniture and cooking utensils.
The Railway Admn.
is also required to bear rent on sanitary and electric installations, service taxes and charges for the electricity and water consumed.
These canteens are also entitled to subsidies at present to the extent of 70% of the wages of the employees engaged therein.
It is further an admitted position that for the purposes of giving subsidy for wages, the rates of pay and allowances as obtaining in July 1963 were adopted as a basis.
In September 1967, on account of a representation received from the canteen employees, the Railway Board left the question of revision of the scales of pay and dearness allowance to the Managing Committees.
However to ensure that the canteen employees functioning at the Metropolitan Cities were not affected adversely, the Board prescribed a minimum dearness allowance relief to the said employees.
In May 1970, the Board reviewed the question of scales of pay, and decided to enhance the dearness allowance relief in respect of employees working in the Metropolitan Cities, and also fixed the scales of pay of the employees working in all non statutory canteens (vide a Railway Board 's letter No. E(W) 69 710 C.N. 1 12 dated 29 5 1970).
These scales of pay were again revised in December 1979, including dearness allowance for employees working in the Metropolitan cities as well as for those working in cities other than Metropolitan cities with effect from 1 10 1979 (Railway Board 's letter No. E (W)/79 C.N. 1 12 dated 14 12 79).
A. further revision of pay scales was elfcoted by the Board in May 1983 (Railway Board 's letter No. E(W)/83/C.N. 1 8 dated 13 5 1983 to ensure com pliance with the interim directions given by this Court on April 22, 1983.
The direction of this Court was to the effect that the salary and allowances of the employees of the non statutory canteens (recognised) should be at the same rate and on the same basis as applicable to the employ ees of the statutory canteens deemed as railway servants with effect from October 22, 1980.
This direction was on the basis of the decision of this Court given on October 22, 1989 (supra).
It is further an admitted fact that the Board has made applicable to these employees the scales of pay as recommended by the Fourth Pay Commission with effect from January 1, 1986.
The employees in these canteens are also entitled to free medical treatment as out door patients in railway hospitals, to railway passes/PTO 's, one increment as an incentive for adoption of a small family.
They are also governed by the provisions of the Employees ' Provident Fund Act.
The Board has also framed recruitment rules for these employees vide its letter dated June 7, 1978.
These rules, among other things, lay down minimum qualifying age for recruitment, and superannuation age, minimum educational qualifications, the mode of recruitment and eligibility for promotion for various posts.
The nominee of the Railway Administration on the Managing Committee of the canteen is to be the Appointing Authority.
At present there are about 173 non statutory recognised canteens employing about 2145 workers.
As pointed out earlier, from the decision dated March 7, 1980 of the Delhi High Court in Writ Petition No. 269 of 1980 filed on behalf of the employees of eleven Delhi based non statutory recognised canteens, the Railway Canteen Karamchari Association had filed a special leave petition before this Court being SLP No. 4132 of 1980 which was disposed of by this Court by its decision of October 22, 1980 (supra).
By that decision, this Court had disposed of the said appeal in terms of the order which was passed in another similar Civil Appeal No. 368 of 1978, and the em ployees were given the same benefits by accepting the prin ciple laid down by the Calcutta High Court.
Thus by the said decision, the employees of the non statutory 711 canteens were directed to be treated on par with the employ ees of the statutory canteens, although by giving liberty to the Railway Administration to agitate the point that neither the employees of the statutory nor of the non statutory recognised canteens were railway employees either for the purposes of the or for any other purpose.
Shri Ramaswamy advanced the same contentions in the case of these employees as he advanced in the case of the employees of the statutory canteens.
He submitted that these employees are appointed by the Staff Managing Committee or Co operative Societies and not by the Rly.
Administration, that their service in the canteen is purely in the nature of a private employment as in a private sector undertaking and that the recruitment procedures differ widely from canteen to canteen and they are not akin to the procedure followed by the Railways.
The Managing Committee which appoints the employees, supervises and controls the canteens is a non Government body.
The said Committee functions as a separate entity independent of the Railway Administration and the control when exercised by the Railway Administration is only to ensure that the canteen is run in conformity with certain requirements.
There is no relationship of master and servant between the Rly.
Administration and the canteen employees.
The letters of appointment issued to the employees make it expressly clear that the employment is non Governmental and purely temporary and does not carry any pensionary or gratu ity benefits.
The employees recruited further are not sub jected to rigorous standards as to age limit, educational qualifications, medical fitness, character verification etc.
He further submitted that the order dated October 22, 1980 passed by this Court in the case of the employees of the eleven Delhi based non statutory canteens is expressly subject to the liberty given to the Railway Administration to contend in a future appropriate case that they are not railway employees and hence it cannot act as a precedent.
He also contended as he did in the case of the statutory can teen employees, that if the employees engaged in these canteens are treated as Railway servants, the employees engaged in other welfare activities, casual labourers etc.
may have also to be treated as such. 29.
These arguments can be dealt with together.
In the first instance, there is hardly any difference between the statutory canteens and non statutory recognised canteens.
The statutory canteens are established wherever the railway establishments employ more than 250 persons as is mandatory under the provisions of Section 46 of the Act while non statutory canteens are required to be established under 712 paragraph 2831 of the Railway Estb.
Manual where the strength of the staff is 100 or more.
In terms of the said paragraph, the non statutory canteens to be recognised have to be approved of by the Railway Board in advance.
Every Rly.
Administration seeking to set up such canteens is required to approach the Railway Board for their prior approval/recognition indicating financial implications involved duly vetted by the Financial Advisor and Chief Accounts Officer of the Railway concerned.
It is only when the approval is accorded by the Railway Board that the canteen is treated as a recognised non statutory canteen.
By the sanction, the details in regard to the number of staff to be employed in the canteen, recurring and non recurring expenditure etc. are regulated.
The only material difference between the statutory canteen and non statutory recognised canteen is that while one is obligatory under the said Act the other is not.
However, there is no difference in the management of the two types of canteens as is evident from the provisions of paragraphs 2832 and 2833 which respective ly provide for their management.
Regarding the incidence of cost to be borne by the Railways again, as far as the Manual is concerned, the only additional obligation cast on the Administration, in the case of the statutory canteens is that in addition to the facilities given to the non statuto ry canteens, the Administration has also to meet the statu tory obligations in respect of the expenditure for providing and maintaining canteens arising from the said Act and the rules framed thereunder.
A perusal of the relevant provi sions shows that the said Act and the rules made thereunder do not make demands on the Administration for more expendi ture than what is provided for in the Railway Manual for the non statutory canteens.
We have already referred to the service conditions applicable to the employees of the statu tory and non statutory canteens.
Besides, while discussing the case of the employees in statutory canteens we have pointed out the relevant provisions of the Administrative Instructions on Departmental Canteens in Government Officers and Govt.
Industrial Establishments.
These Instructions are applicable to both statutory and nonstatutory recognised canteens.
The Instructions do not make any difference be tween the two so far as their applicability is concerned.
In fact these Instructions require that the canteens run by engaging solely part time daily wage workers may be convert ed to departmental canteens (para 1.3).
Hence we donot see why any distinction be made between the employees of the two types of canteens so far as their service conditions are concerned.
For this very reason, the two notifications of December 11, 1979 and December 23, 1980 (supra) should also be equally applicable to the employees of these canteens.
If this is so, then these employees would also be entitled to be treated as rail 713 way servants.
A classification made between the employees of the two types of canteens would be unreasonable and will have no rational nexus with the purpose of the classifica tion.
Surely it cannot be argued that the employees who otherwise do the same work and work under the same condi tions and under a similar management have to be treated differently merely because the canteen happens to be run at an establishment which employs 250 or less than 250 members of the staff.
The smaller strength of the staff may justify a smaller number of the canteen workers to serve them.
But that does not make any difference to the working conditions of such workers.
We have already dealt with the other arguments advanced by Shri Ramaswamy while dealing with the cases of employees in statutory canteens.
It is not necessary to repeat the said discussion here.
We are, therefore, of the view that the case of these employees should be treated on par with that of the employees in the statutory canteens and they should also be treated for all purposes as railway servants.
This is apart from the fact that by an order of this Court the employees of eleven Delhi based non statutory recognised canteens have already been directed to be treated as railway servants for all purposes.
(iii)Non Statutory Non Recognised Canteens: The difference between the non statutory recognised and non statutory nonrcognised canteen is that these canteens are not started with the approval of the Railway Board as re quired under paragraph 2831 of the Railway Establishment Manual.
Though, they are started in the premises belonging to the Railways they are so started with the permission of the local officers.
They are not required to be managed either as per the provisions of the Railway Establishment Manual or the Administrative Instructions (Supra).
There is no obligation on the Railway Administration to provide them with any facilities including the furniture, utensils, electricity and water.
These canteens are further not enti tled to nor are they given any subsidies or loans.
They are run by private contractors and there is no continuity either of the contractors or the workers engaged by them.
Very often than not the workers go out with the contractors.
There is further no obligation cast even on the local of fices to supervise the working of these canteens.
No rules whatsoever are applicable to the recruitment of the workers and their service conditions.
The canteens are run more or less on ad hoc basis, the Railway Administration having no control on their working neither is there a record of these canteens or of the contractors who run them who keep on changing, much less of the workers engaged in these can teens.
In the circumstances we are of the view of 714 that the workers engaged in these canteens are not entitled to claim the status of the railway servants.
The result, therefore, is that the workers engaged in the statutory canteens as well as those engaged in non statutory recognised canteens in the Railway Establishments are railway employees and they are entitled to be treated as such.
The Railway Board has already treated the employees of all statutory and eleven Delhi based non statutory recog nised canteens as railway employees w.e.f. October 22, 1980.
The employees of the other non statutory recognised canteens will, however, be treated as railway employees w.e.f. April 1, 1990.
They would, therefore, be entitled to all benefits as such railway employees with effect from the said date, according to the service conditions prescribed for them under the relevant rules/orders.
The Writ Petitions and appeals of these employees are allowed to the above extent accordingly with no order as to costs.
As far as the employees in non statutory non recog nised canteens are concerned their petitions are dismissed.
There will, however, be no order as to costs.
R.S.S. Petitions and Appeals allowed.

summary:
The petitioners in this group of Writ Petitions are workers in canteens run in different railway establishments.
The relief claimed in all the petitions is that the workers concerned should be treated as railway employees and should be extended all service conditions which are available to the railway employees.
For convenience sake, the canteens have been classified into three categories, viz., (i) Statutory canteens; (ii) Non statutory Recognised Canteens, and (iii) Non Statutory Non Recognised canteens.
Chapter XXVIII of the Railway Establishment Manual contains the necessary instructions for running the can teens.
Paragraph 2829 of Chapter XXVIII of the Manual refers to the provisions of Section 46 of the and under writes the fact that under these provisions, there is a statutory obligation on the Railway Administration to set up canteens in Railway establishments which are governed by the said Act and which employ more than 250 persons.
Paragraph 2831 lays down the principles governing the set ting up of the canteens which apply also to the non statuto ry canteens provided for under paragraph 2830.
Paragraph 2832 inter alia states that although the Administration can employ as agent a Staff Committee or a Co operative Society for management, the legal responsibility for proper manage ment rests not with the agency but solely with the Railway Administration.
The Department of Personnel & Training, Ministry of Personnel, Government of India, had issued Administrative Instructions on Departmental Canteens in Offices and Indus trial Establishments of the Government.
It is made clear in these instructions that the orders issued under the said Instructions are applicable to all Canteens/Tiffin Rooms functioning or to be set up in any Ministry, Department, Establish 688 ment, Office, or Installation of the government of India (Industrial or non industrial), including those functioning under the Ministries of Defence, P & T and Railways unless these three Ministries had previously decided to exempt any of the said Instructions due to specific reasons.
It was contended on behalf of the petitioner workers that, in view of the documents on record there is no reason why the employees in the canteens concerned should not be given the status of the railway employees with all conse quential benefits.
On the other hand, it was contended on behalf of the Railways that (i) the canteen employees are appointed by the Staff Managing Committees or Co operative Societies and not by the Railway Administration and as such there is no rela tionship of master and servant between the Railwasy Adminis tration and the Canteen employees, and in no case can they be deemed as holders of civil posts, either for Article 309 or for Article 311 of the Constitution; (ii) the control exercised by the Railway administration is only to ensure that the canteens are run in conformity with certain re quirements; (iii) the Railways have a primary objective of carrying goods and passengers and the welfare activities are ancillary to the main objective; (iv) the canteens continue at the discretion of the Railway Administration, and at any stage the Government can change the form of this welfare measure and choose to have another set up; (v) the Railways undertake varied welfare activities, and if it is decided to treat the employees engaged in the canteens as railway employees, it will be difficult to resist the claim from employees of these other institutions for a similar status; and (vi) the Railway Establishment Manual contains the necessary instructions for running the canteens, and hence the Railway Administration should be deemed to have been exempted from the operation of the Administrative Instruc tions on Departmental Canteens in Offices and Industrial Establishments of the Government, issued by the Department of Personnel & Training.
Allowing the petitions filed by the employees of the statutory canteens and non statutory (recognised) canteens.
and dismissing those of the non statutory (non recognised) canteens.
this Court.
HELD: Statutory Canteens (1) In terms of the Rules made by the State Governments under Section 46 of the it is obligatory on the Railway Administration to provide a canteen in an establishment which employs 689 more than 250 persons.
The provision of the canteen is therefore, deemed by the statute as a necessary concomitant of the manufacturing activity.
[692C; G] The employees of the departmental canteens/tiffin rooms were declared as holders of civil posts under the Government of India Notification dated December 11, 1979 which is annexed to the Administrative Instructions on Departmental Canteens in Offices and Industrial Establish ments of the Government.
That Notification states that all posts in the said canteens/tiffin rooms are to be treated as posts in connection with the affairs of the Union, and hence the incumbents would qualify as holders of civil posts.
Accordingly, service rules were framed under Article 309 as per the notification issued by the Government of India, Department of Personnel & Training on December 23, 1980.
[705H; 706A B] (3) The provisions contained in the Administrative Instructions, show that the Government has a complete con trol over the canteens and the workers employed therein 'are holders of civil posts within the meaning of Article 311 of the Constitution.
There recruitment and service conditions are governed by the rules applicable to the employees of the Department/Office/Establishment to which the canteens are attached.
[701E] (4) Although there is nothing expressly on record to show that the railway canteens are exempted from the said Administrative Instructions, but even assuming that the railway canteens are exempted by virtue of the relevant provisions of the Railway Manual, the fact remains that there are as yet no notifications on the lines of December 11, 1979 and December 23, 1980 issued for the benefit of the employees in the railway canteens.
[706E F] (5) It cannot be argued that there is any difference in the work performed by the employees in the canteens run in the establishments of the Ministries.
If the said two noti fications are applicable to the employees in the canteens run by the other departments of the Government of India, there is no reason why the same should not apply also to the employees in the canteens run by the Railways.
In the cir cumstances, it would be highly discriminatory not to apply the said two notifications to the employees in the Railway canteens.
It would be violative of Articles 14 and 16 of the Constitution.
The employees in the Statutory canteens of the Railways will therefore have to be treated as Railway serv ants.
[706F H; 707A] 690 (6) Thus the relationship of employer and employee stands created between the Railway Administration and the canteen employees from the very inception.
Hence, it cannot be gainsaid that for the purposes of the the employees in the statutory canteens are the employees of the Railways.
[707B] Order dated 22.10.1980 in Civil Appeal No. 368 of 1978 (Supreme Court); Madras High Court; Writ Appeals Nos.
414 415 of 1978.
referred to.
(7) If by virtue of all these facts the employees are entitled to the status of Railway employees they cannot be deprived of that status merely because some other employees similarly or dis similarly situated may also claim the same status.
The argument to say the least can only be described as one in terroram.
and as any other argument of the kind has to be disregarded.
[708E] Non Statutory Recognised Canteen (8) These canteens are run in the establishments which employ 250 or less than 2.50 employees; and are established with the prior approval and recognition of the Railway Board.
There is hardly any difference between the statutory canteens and non statutory recognised canteens.
The only material difference is that while one is obligatory under the , the other is not.
However.
there is no difference in the management of the two type of canteens.
[71 I G; 712C] (9) The Administration Instructions on Departmental Canteens in Government Offices and Government Industrial Establishments do not make any difference between the two so far as their applicability is concerned.
Hence, it cannot be seen why any distinction be made between the employees of the two types of canteens so far as their service conditions are concerned.
For this very reason, the two notifications of December 11, 1979 and December, 23, 1980 should also be equally applicable to the employees of these canteens.
[7 12G H] (10) If that is so, then these employees would also be entitled to be treated as railway servants.
A classification made between the employees of the two types of canteens would be unreasonable and will have no rational nexus with the purpose of the classification.
Surely it cannot be argued that the employees who otherwise do the same work and work under the same conditions and under a similar manage ment have to be treated differently merely because the canteen happens to be 691 run at an establishment which employees 250 or less than 250 members of the staff.
[712H; 713A B] Non Statutory Non Recognised Canteens (11) These canteens are run at establishments which employ 100 or less than 100 employees, and are established without prior approval or recognition of the Railway Board.
[692E] The Canteens are run more or less on ad hoc basis, the Railway Administration having no control of their function ing.
They are not required to be managed either as per the provisions of the Railway Establishment Manual or the Admin istrative Instructions.
In the circumstances the workers engaged in these canteens are not entitled to claim the status of the railway servants.
[713H; 714A]


judgement:
ivil Appeal No. 1319 of 1990.
717 From the Judgment and Order dated 7.9.1987 of Delhi High Court in S.A.O. No. 99/1987.
Dr. L.M. Singhvi and Dalveer Bhandari for the Appellant.
Dr. Y.S. Chitale and A.K. Sangal for the Respondent.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
Special Leave granted.
This is an appeal by the landlady whose application for being put in possession of the premises on the expiry of a limited tenancy of two years under section 21 of the Delhi Rent Control Act (hereinafter referred to as 'the Act ') has been dismissed by the Rent Controller, the Rent Control Tribunal and the High Court.
On 30th September, 1976, the appellant landlady and the respondent tenant appeared before Shri M.A. Khan, Additional Rent Controller for creation of a tenancy under section 21 of the Act.
The Additional Rent Controller recorded the statements of both the landlady and the prospective tenant and made the following order: "Having regard to the facts stated in the petition and the statement of the parties made above permission under section 21 of the Delhi Rent Control Act is granted to Yamuna Maloo applicant to let out ground floor of her premises No. B 2/104, Safderjung Enclave, New Delhi comprising of drawing cum dining hall, two bed rooms with attached bath room, kitchen, parking place and a small ' lawn delineated in the enclosed plan exhibit AI, to Mr.
Anand Swarup respondent for residential purposes for a limited period of two years with effect from 1.10.76.
" After the expiry of the two year period, when the re spondent did not vacate the premises, the landlady moved the Rent controller for issuance of warrant of possession to which the tenant filed his objection.
The Additional Rent Controller entertained the objection and dismissed the landlady 's petition for being put into possession.
There upon the landlady moved the Rent Control Tribunal in appeal and when she failed before it, a second appeal was filed before the High Court which was dismissed in limine.
718 The Controller relied upon the judgment of this Court in S.B.Noronah vs
Prem Kumari Khanna[1980] 1 SCR 281 and came to hold: "I have carefully gone through the execution appli cation, the objections, the evidence on record, the original file in which the permission was granted and have heard the learned counsel for parties.
I am of the view that the order dated 30.9.75 granting permission was not in accordance with law and that the applicant/petitioner is not entitled to obtain possession of the premises in dispute under section 21 of the Delhi Rent Control Act.
" Noronah 's case had stated: "Of course, there will be presumption in favour of the sanction being regular, but it will Still be open to a party to make out his case that in fact and in truth the conditions which make for a valid sanction were not present.
" It is interesting to note that by the time the appel lant 's appeal came up for hearing before the Tribunal, Shri M.A. Khan who as an Additional Rent Controller had approved the tenancy by his order dated 30th September, 1976, on being judicially satisfied that the tenancy under section 21 of the Act could be created had become the Rent Control Tribu nal.
He noticed this fact in his appellate order dated 11th April, 1986, by stating "In this appeal, the validity and executability of the order dr. 30.9.76 is disputed which was passed by me as Addl.
Rent Controller.
Since there is no other Rent Control Tribunal, therefore, in exigency of the situation I have no option but to proceed to decide this appeal.
" He concluded "The appellant in the application and in her statement did not give the reason for letting out the premises for two years only.
She even did not give the reason in application for recovery or ' possession.
In reply to the objection of the respondent, she states that she was residing in Vasant Vihar at a house which was allotted to her husband by the employer.
There was no possibility of her vacating the said 719 house and shifting to the disputed premises.
The first floor of the disputed premises was also let out by her to another tenant for a limited period.
She did not disclose that she intended to create a limited tenancy in respect of the first floor also.
Further the premises were let after an adver tisement of 'to let ' in Hindustan Times dt.
25.9.76.
It is conceded that in the advertisement it was not specified that the premises were available for letting for two years only.
All these facts proved that the appellant did not require the premises for occupation after two years and that these premises could have been let out for an indefinite period.
She made a wrong statement before the court.
She also con cealed the material facts from the court.
She obtained the permission from the court under section 21 by playing fraud.
The order passed under section 21 is therefore invalid and in execution thereof, the respondent cannot be evicted.
" We have already said that the second appeal was dis missed in limine.
Lengthy arguments were advanced at the hearing in support of the respective stands.
Counsel for the landlady argued that the Additional Rent Controller should not have entertained the objection of the tenant to the execution of the eviction order as the same had not been filed during the currency of the tenancy; it was further argued that some of the considerations which weighed with the Rent Control Tribunal were ) not at all relevant for judging the bona fides and genu ineness of actions taken on 30th of September, 1976, at the time of creation of the tenancy.
On the/side of the tenant, the contentions which had prevailed with the 'Additional Rent Controller and the Rent Control Tribunal were reiterated.
Section 14 of the Act deals with a normal tenancy and protects the tenant against unreasonable eviction.
Section 21 of the Act, on the other hand, places tile tenant outside the purview of section 14 and provides for an order of eviction at the time of creation of the tenancy.
There is a purpose behind enacting section 21 of the Act.
The Legislature considered it appropriate that should a landlord not need his residen tial premises for a period, instead of keeping the same vacant the same could be available for a tenant 's use on being let out for a limited period condi 720 tional upon the tenant 's surrendering possession as soon as the tenancy terminates by efflux of time and the need of the landlord revives.
The conditions to be fulfilled at the time of creation of such a tenancy are three, namely, (i) the landlord would not require the premises for a particular period, (ii) the Controller must be satisfied about that position, and (iii) the tenant agrees to vacate at the end of the period.
In Noronah 's case supra two Judge Bench dealt with this question.
This Court then said.
"We must notice that section 21 runs counter to the general scheme and, therefore, must be restricted severely to its narrow sphere.
Secondly, we must place accent on every condition which attracts the section and if any one of them is absent the section cannot apply and, therefore, cannot arm the landlord with a resistless eviction process.
Third ly, we must realise that the whole effect of section 14 can be subverted by ritualistic enforcement of the conditions of sanction under section 21 or mechanical grant of sanction therein.
Section 21 overrides section 14 precisely because it is otherwise hedged in with drastic limitations and safeguards itself against landlords ' abuses.
It is true that the judgment of this Court which is dated August 16, 1979, was not in existence when Sri Khan sanctioned the tenancy but the law then in force was not different.
In fact, the orders out of which that appeal arose had also taken the same view.
This Court Noronah 's case further said: "When an application under section 21 is filed by the land lord and/or tenant, the Controller must satisfy himself by such inquiry as he may make, about the compulsive require ments of that provision.
If he makes a mindless order, the Court, when challenged at the time of execution, will go into the question as to whether the twin conditions for sanction have really been fulfilled.
" A three Judge Bench of this Court in J.R. Vohra vs India Export House Pvt. Ltd. & Anr., ; was examin ing the requirement of notice to the tenant when at the expiry of the period of tenancy the landlord had applied for being put in possession.
While so examining that question this Court approved the following observations in Noronah 's case: 721 "Parliament was presumably keen on maximising accommodation available for letting, realising the scarcity crises.
One source of such spare accommodation which is usually shy is potentially vacant building or part thereof which the land lord is able to let out for a strictly limited period pro vided he has some credible assurance that when he needs he will get it back.
If an officer is going on other assignment for a particular period, or the owner has official quarters so that he can let out if he is confident that on his re tirement he will be able to re occupy, such accommodation may add to the total lease worthy houses.
The problem is felt most for residential uses.
But no one will part with possession because the lessee will become a statutory tenant and, even if bona fide requirement is made out, the litiga tive tiers are so many and the law 's delays so tantalising that no realist in his sense will trust the sweet promises of a tenant that he will return the building after the stipulated period.
So the law has to make itself credit worthy.
The long distance between institution of recovery proceedings and actual dispossession runs often into a decade or more a factor of despair which can be obviated only by a special procedure.
Section 21 is the answer.
The law seeks to persuade the owner of premises available for letting for a particular or limited period by giving him the special assurance that at the expiry of that period the appointed agency will place the landlord in vacant possession.
" Noronah 's judgment was approved to this extent.
In the three succeeding paragraphs in Vohra 's decision.
Noronah 's case was also referred to.
Dealing with the contentions relied upon in Noronah 's case, Tulzapurkar, J. who delivered the judgment of the Court, observed: "At the outset we would like to observe that in Noronah 's case the question whether a prior notice is required to be served upon the tenant before issuance of warrant of posses sion in favour of the landlord under section 21 did not arise for consideration.
It was a case where upon receipt of landlord 's application for recovery of possession under the section the tenant raised pleas that the premises had been let out for non residential purposes and that the sanction or permission granted for the creation of the limited tenan cy was vitiated by fraud and collusion and the question that 722 arose for consideration was whether at that stage the Rent Controller could go into and consider such pleas and this court has ruled that the Controller should consider those pleas even when raised at that stage.
" A little later Justice Tulzapurkar further observed: "In fact even in Noronah 's case this Court has observed,that there will be a presumption in favour of the sanction or permission being regular and if that be so, we fail to appreciate as to why the Rent Controller should invite such pleas of fraud, collusion etc.
at the instance of the tenant by being required to serve a notice upon him before issuing the warrant of possession in favour of the landlord espe cially when the scheme of sec.
21 and the connected relevant provisions do not require it.
" The three Judge Bench thereafter went to consider the remedy available to the tenant in a case where the objec tions were as in the present case: "What then is the remedy available to the tenant in a case where there was in fact a mere ritualistic observance of the procedure while granting permission for the creation of a limited tenancy or where such permission was procured by fraud practised by the landlord or was a result of collusion between the strong and the weak? Must the tenant in such cases be unceremoniously evicted without his plea being inquired into? The answer is obviously in the negative.
At the same time must he be permitted to protract the delivery of possession of the leased premises to the landlord on a false plea of fraud or collusion or that there was a mechan ical grant of permission and thus defeat the very subject of the special procedure provided for the benefit of the land lord in section 217 The answer must again be in the nega tive.
In our view these two competing claims must be harmo nised and the solution lies not in insisting upon service of a prior notice on the tenant before the issuance of the warrant of possession to evict him but by insisting upon his approach the Rent Controller during the currency of the limited tenancy for adjudication of his pleas no sooner he discovers facts and circumstances that tend to vitiate ab initio the initial grant of permission.
Either it is a 723 mechancial grant of permission or it is procured by fraud practised by the landlord or it is the result of collusion between two unequals but in each case there is no reason for the tenant to wait till the landlord makes his application for recovery of possession after the expiry of the fixed period under section 21 but there is every reason why the tenant should make an immediate approach to the Rent Con troller to have his pleas adjudicated by him as soon facts and circumstances giving rise to such pleas come to knowledge or are discovered by him with the diligence.
The special procedure provided for the benefit of the landlord in section 21 warrants such immediate approach on the part of the tenant.
" What followed thereafter perhaps is more in the nature of an obiter than a part of the decision proper, namely: "Of course if the tenant alliunde comes to know about land lord 's application for recovery of possession and puts forth his plea of fraud or collusion etc.
at that stage the Rent Controller would inquire into such plea but he may run the risk of getting it rejected as an afterthought.
" It may be pointed out that in Vohra 's case the objec tions on the ground of fraud and collusion were raised after the claim by the landlord for being put in possession but were rejected as belated.
The question that came for consid eration before the three Judge Bench was whether notice was necessary when the landlord applied to be put in possession after the termination of the tenancy.
In that context, the observation that tenant 's objections could be enquired into if the tenant aliunde came to know of the landlord 's move and objected was not relevant for the decision.
There are certain observations in Inder Mohan Lal vs Ramesh Khanna; , which are relevant: "An analysis of this judgment (Noronah 's case) which has been applied in the various cases would indicate that sec tion 21 only gives sanction if the landlord makes a state ment to the satisfaction of the court and the tenant accepts that the landlord does not require the premises for a limit ed period; this statement of the landlord must be bona fide.
The purpose must be residence.
There must not be 724 any fraud or collusion.
There is a presumption of regulari ty.
But it is open in particular facts and circumstances of the case to prove to the satisfaction of the executing court that there was no collusion or conspiracy between the land lord and the tenant and the landlord did not mean what he said or that it was a fraud or that the tenant agreed be cause the tenant was wholly unequal to the landlord.
In the instant case none of these conditions were fulfilled.
There is no evidence in this case that when the landlord stated that he did not require the premises in question for a particular period, he did not mean what he stated or that he made a false statement.
There was no evidence in this case at any stage that the tenant did not understand what the landlord was stating or that he did not accept what the landlord stated.
There was no evidence that either the tenant was in collusion or perpetrating any fraud with the landlord or the tenant was unequal to the landlord in bar gaining powers.
It is manifest that there is no evidence to show that the Controller did not apply his mind.
If that is so then on the principle enunciated by this Court in Noro nah 's case, this sanction cannot be challenged.
It is not necessary to state under section 21 the reasons why the landlord did not require the premises in question for any particular period.
Nor is there any presumption that in all cases the tenants are the weaker sections.
The presumption is, on the contrary, in favour of sanction, it is he who challenges the statement and the admission of the landlord or the tenant who has to establish facts as indicated in Nagindas case.
" In paragraph 22 of the judgment Mukharji, J. (as he then was) speaking for the Court held out a caution that the residue must be understood in its proper perspective.
We may point out that the respondent apart from being highly quali fied held the position of a Deputy Secretary to Government and, therefore, was not a tenant of the type in Noronah 's case.
As has been stated in Inder Mohan Lal 's case, the rule in Noronah 's case has to be confined to a particular set of facts and should not be freely extended so as to take away the effect of section 21.
Fraud is an allegation which can easily be made but unless the allegations are clearly pleaded and some evidence, either direct or circumstantial, is avail able, a charge of fraud would not succeed.
We may refer to another judgment of this Court in the case of Shiv Chander Kapoor.
vs Amar Bose, JT where the 725 validity of the permission under section 21 of the Act came up for consideration.
Noronah 's case was also referred to.
In paragraph 15 of the judgment this Court pointed out that there is nothing in this decision to support the respondent tenant 's contention in that appeal that the scope of enquiry is wider permitting determination of the land lord 's bona fide need of the premises as if such a ground for eviction specified in section 14 of the Act was required to be proved.
Extending the enquiry to that field would indeed be against the express prohibition enacted in section 21 of the Act.
Referring to Vohra 's case, the latest judgment indi cates: "It is obvious from the decision in J.R. Vohra 's case that the tenant is expected to raise such a plea during currency of the limited tenancy and on such a plea being raised by the tenant enquiry into it is contemplated.
Even though it is not expressly said in Vohra 's case, it is implicit that on such an application being made by the tenant requiting adjudication by the Controller, it is the Controller 's obligation to issue notice of the same to the landlord and then to make the adjudication with opportunity to both sides to prove their respective contentions.
Both in Vohra 's case and in Shiv Chander Kapoor 's case though not arising for determination in either, it has been stated while laying down the rule that proceeding to chal lenge limited tenancy has to be taken during the cunency of the tenancy, an objection filed by the tenant could be looked into is indeed an obiter.
We would like to make it clear that the rule having been stated to the contrary in Vohra 's case, there was indeed no warrant to indicate the contra situation.
Perhaps to meet the eventuality which might arise in a particular case, neither of the two Benches of this Court wanted to close the avenue of enquiry totally, and that is why in both the cases decided by coordinate Benches the exception has also been indicated.
It must be understood on the authority of the said two decisions and our judgment now that if the tenant has objection to raise to the validity of the limited tenancy it has to be done prior to the lapse of the lease and not as a defence to the landlord 's application for being put into possession.
We would like to reiterate that even if such an exercise is available that must be taken to be very limited and made applicable to exceptional situations.
Unless the tenant is able to satisfy the Controller that he had no opportunity at all to know the facts earlier and had come to be aware of them only then, should such an objection be entertained.
726 On the application of those tests to the present facts we must hold that the belated objections of the tenant should not have been entertained and prayer for possession made by the landlady after the limited tenancy ran out should have been granted.
The appeal is allowed; the decisions of the Controller, Rent Control Tribunal and the High Court are reversed and the landlady is directed to be put into possession of the premises by 31st of March, 1990.
The appellant would be entitled to her costs in the proceedings throughout.
Hearing fee is assessed at Rs.2,000.
G.N. Appeal al lowed.

dataset_name: IN-Abs

summary:
The appellant landlady and the respendent tenant ap peared before the Rent Controller for creation of a tenancy under Section 21 of the Delhi Rent Control Act, 1958.
Ac cordingly, the authority passed an order creating tenancy for a limited period of two years.
Since the respondent did not vacate the premises on the expiry of two years, the appellant moved the Rent Controller for issuance of warrant of possession.
The Respondent filed his objection.
Enter taining the objection the Rent Controller dismissed the petition, holding that the order granting permission for the tenancy under section 21 of the Act was not in accordance with law.
The appellant 's first appeal before the Rent Control Tribunal, as also her second appeal before the High Court met the same fate.
This appeal, by special leave, is against the High Court 's order dismissing the second appeal in limine.
On behalf of the appellant, it was contended that the Rent Controller should not have entertained the objection of the respondent as the same has not been filed during the currency of the tenancy.
It was also contended that some of the considerations which weighed with the Rent Control Tribunal were not relevant for judging the bona fides and genuineness of actions taken at the time of creating the tenancy.
Allowing the appeal, this Court, HELD: 1.
Section 14 of the Delhi Rent Control Act, 1958 deals with a normal tenancy and protects the tenant against unreasonable eviction.
Section 21 of the Act, on the other hand, places the tenant outside the purview of section 14 and provides for an order of eviction at the time of creation of the tenancy.
There is a purpose behind enacting section 21 of the Act.
The Legislature considered it appropriate that should a 716 landlord not need his residential premises for a period, instead of keeping it vacant the same could be available for a tenant 's use on being let out for a limited period condi tional upon the tenant 's surrendering possession as soon as the tenancy terminates by efflux of time and the need of the landlord revives.
[719G H; 720A] 2.1.
The rule in Noronah 's case has to be confined to a particular set of facts and should not be freely extended so as to take away the effect ors.
[724F G] 2.2.
In Vohra 's case and in Shiv Chander Kapoor 's case, though not arising for determination in either, it has been stated while laying down the rule that proceeding to chal lenge limited tenancy has to be taken during the currency of the tenancy, an objection filed by the tenant could be looked into, is indeed an obiter.
The rule having been stated to the contrary in Vohra 's case, there was indeed no warrant to indicate the contra situation.
Perhaps to meet the eventuality which might arise in a particular case, the exception has also been indicated.
If, the tenant has an objection to raise to the validity of the limited tenancy it has to be done prior to the lapse of the lease and not as a defence to the landlord 's application for being put into possession.
Even if such an exercise is available that must be taken to be very limited and made applicable to excep tional situations.
Unless the tenant is able to satisfy the Controller that he had no opportunity at all to know the facts earlier and had come to be aware of them only then, should such an objection be entertained.
[725E H] 2.3.
In the facts and circumstances of the present case the belated objections of the tenant should not have been entertained and prayer for possession made by the landlady after the limited tenancy ran out should have been granted.
[726A] S.B. Noronah vs Prem Kumari Khanna, ; ; J.R. Vohra vs India Export House Pvt. Ltd. & Anr., ; ; Inder Mohan Lal vs Ramesh Khanna, ; and Shiv Chander Kapoor vs Amar Bose, JT , referred to.
[This Court directed that the landlady be put into possession of the premises by 31st March, 1990.]