SMT. USHA RANI DATTA, AAYA/ ATTENDANT AND OTHERS versus STATE INDUSTRIAL COURT, INDORE & ORS.

Citation: [1985] 3 S.C.R. 1049 · Decided: 30-04-1985 · Supreme Court of India · Bench: D.A. DESAI · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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SMT. USHA RANI DATTA, AAYA/ATTENDANT 
AND OTHERS 
v. 
STATE INDUSTRIAL COURT, INDORE & ORS . 
. April 30, .1985 
[D.A. DESAI AND V. KHALID, JJ.] 
Industrial Dispute.~ Act : 
1049 
29 
Family Planning 
Clinic-Finizncial Expenditure 
irJcurred by Central 
Government-Taken over by Public Sector Undertaking Steel Plant-E1nployees of 
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Clinic-Whether employees of Steel Plant. 
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Urban Family Clinic was set up by a.S~cel Plant for imP.lement'!:.tion of 
family· welfare schemes. The Chief M~dicaI O~~er of ~he Plant' was ,lhe adJ?1inis· 
trative officer for the Clinic. 
The financi<i:l,e~.penditure of ,the Clinic was bOrne 
by the.Government of Indi:i. Subsequently t~e Clinic Was treated .as an integral 
part of the administration of the Plant an~ its employees were .ibsorbed wilh 
effect from February 4, 1976. 
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The appellants who were serving as Aaya/ Attendants moved an applica-
tion before the Labour Court for a relief that they are being wrongly treated as 
fre~h employees from the date of absorption and that their services si~ce the 
commencemeDt of employment be treated as continuoUs for the purpo'se of 
gratutity, retrenchment and leave. etc. 
J. . 
The management of the Plant contested the application contending tha't 
the Clinic was nn independent unit set up by. the Government Of 1ddia and .that 
it was not an integral part of the administration and, therefore, the services 
rendered prior to the absorption could not be treated as service under the Plant 
and, therefore_, the application deserves to be dismissed. 
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The Labour Court allowing the app1ication held· that the Clinic had bard· 
ly any independent existence and that the .employees of the Clinic were in reality 
and for all practical purposes the employees of the Plant. 
Two revision petitions were filed before the Industrial Court-one on be-
half of -the Plant, and the other on behalf of the appellants. The Industrial 
Court dismissed the revision petitio'n of-the appellants with a further direction 
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1050 
SUPREME COURT REPORTS 
[1985] 3 S.C.R· 
A 
that the appli~ation before the Labour Court was liable to. be dismissed. While 
allowing the fevision petition of the tnana~ement, th~ Industrial Court held that 
family planning: centres were run by different public undertakings and it was 
started as part of the general policy of the Government of India and even 
though the expenditure of the centre was reimbursed by the Government, the 
Clinic of the centre could not be said to be an irn.lustry within the meaning of 
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c 
D 
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expression in the Act nor could it be said to be iacidental to the main business 
of the Plant. The prayer in the application before the Labollr Court that the 
appellants should be given additional and better wages and service conditions 
was beyond the competence of the Labour Court and conseq~eritly the applica-
tion was not maintainable. 
The writ petition filed ~y the appellants \Vas distnissed by the lligh Court, 
Allowing the Appeal, 
HELD : I. The findings of facts as recorded by the Labour Court and 
·which have neither been departed from nor questioned by the High Court 
clearly point to the inescapable conclusion that the Clinic had no independent 
existence of its own and that for all practical purposes it was under the adminis· 
trative control of the Plant. (1053 E] 
2. The Clinic had no·independent existence. In fact it was an euphemism 
to call it an independent undeftaking. It was part arid parcel of the adminis-
trative set up. The Clinic was managed by the Chief Medical Officer of the 
Plant with a designation of Administrative Officer, and was accountable for the 
money received fronl the Government of India. The Jabour Court was perfectly 
justified in holding that the employees of the Clinic were the employees of the 
Plant working in a department tinder the administrative control of Chief Medi· 
cal Officer who was under the overall administrative control of the management 
of the Plant. The Labour Court was perfectly justified in holding that since 
the inception of the Clinic the employees were the employees of the Plant .and 
tha\the absorption was an acceptance of reality avoiding the pretence. 
(1054 E; G-H; 1055 A-BJ 
3. The Industrial Court was in error in concluding that whether the 
application as made was not maintainable. The reasons which appealed to the 
Labour Court for holding that the application was maintainable are indispu ta· 
bly unquestiona

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