State Instrumentalities Not Having Power To Create Posts Cannot Regularise Workers: Bombay High Court Reiterates

The High Court was hearing a challenge to the impugned order passed by Industrial Court, Thane declaring that respondents were engaged in unfair labour practice and further directing them to give permanency to complainants. The impugned judgment had noted that the respondents' actions were falling foul of Item 6 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971.

The Bombay High Court in its judgment notes that the Industrial Court had not referred to the Standing Order 4C of the Model Standing Orders, framed under the Industrial Employment (Standing Orders) Act, 1946. It also notes that the impugned judgment is not cognizant of the interpretation of Standing Order 4C as laid down by the Aurangabad Bench of the Bombay High Court. Therein the Court had concluded that Standing Order 4C cannot be invoked with reference to State Instrumentalities or such local authorities which do not have the power to create posts. It notes:

"This issue of invoking Standing Order 4C of the Model Standing Orders for granting permanencl was considered bl me at the Aurangabad Bench in the matters of Mukhladhikari, Nagar Parishad, Tuljapur Vs. Vishal Vijal Amrutrao and others [2016(3) ALL MR 113] and Municipal Council, Tuljapur Vs. Baban Hussain Dhale [WP No.1843/2015 and connected matters, decided on 26/02/2015]. I had concluded that Standing Order 4C cannot be invoked with reference to State Instrumentalities or such local authorities, which do not have the power of creating posts. When an establishment cannot create posts, the declaration of ULP under Item 6 cannot be made against such establishment since temporary workers cannot be regularized, in the absence of sanctioned permanent posts." (Para 7)

The Court also relies on the decision of the Bombay High Court in Municipal Council Tirora vs Tulsidas Baliram Bindhade.

"In Municipal Council Tirora Vs. Tulsidas Baliram Bindhade [ 2016 (l6) Mh.L.J. 867 ]. It was concluded that in service matters concerning State Instrumentalities, the Industrial Court cannot grant regularization bl invoking Standing Order 4C of the MSO for granting permanency or regularization. " (Para 8)

In the present case, the Court notes, the Zilla Parishad does not have the power to create posts. It can only recommend to the competent Department of the State Government, which is the Department of Rural Development, for seeking sanction and for seeking permanency to such employees, who are working in the Class IV categories. Accordingly, the decision to grant permanency would lie with the Rural Development Ministry and the Zilla Parishad can only prepare a category of workers and seek the sanction of the State Government to treat such employees as permanent employees. It observes: 

"Considering the law crystallized in Mukhladhikari, Nagar Parishad, Tuljapur (supra), Municipal Council, Tuljapur (supra) and Municipal Council, Tirora (supra), the Zilla Parishad has to forward the proposals of such daily wagers to the Rural Development Department/Directorate of Municipal Administration, as the case may be, and such Department of the State Government then has to take a call by arriving at a decision." (Para 13)

The directions issued by the Industrial Court, Thane have been set aside and Raigad Zilla Parishad is directed to prepare a fresh proposal of all the workers working in the Water Supply Department, inclusive of the original complainants, in order of their seniority in joining employment with the Zilla Parishad and forward the said proposal to respondent No.8 through the Rural Development Department, on or before 15/02/2022. Further, the Competent Department is directed to take appropriate decision on or before 30/06/2022.

Case Title: Raigad Zilla Parishad & Ors v Kailash Balu Mhatre & Ors

Coram: Justice Ravindra V Ghughe

Citation : 2022 LiveLaw (Bom) 20

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