1    

REPORTABLE  

IN THE SUPREME COURT OF INDIA  CIVIL APPELLATE JURISDICTION  

 Civil Appeal No.  1878 of 2016  

 Oil and Natural Gas Corporation                                  …Appellant       

Versus     Krishan Gopal & Ors.                          …Respondents  

With     

Civil Appeal Nos 935-937 of 2020  SLP(C) Nos. 10478-10480/2016  

With  

Civil Appeal  Nos 938-939 of 2020  SLP(C) Nos. 30854-30855/2017  

With  

Civil Appeal  No 934 of 2020  SLP(C) No. 16455/2018  

And With  

Civil Appeal  Nos 669-696 of 2020  SLP(C) Nos. 15971-15998/2018  

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J U D G M E N T      

Dr Dhananjaya Y Chandrachud, J.                       

1 This batch of appeals arises from the judgments of the High Courts of  

Andhra Pradesh, Delhi, Madras and Uttarakhand. A judgment of a two judge  

Bench of this Court in Oil and Natural Gas Corporation Limited v Petroleum  

Coal Labour Union 1  (“PCLU”) has assumed focus since the decisions of the  

High Courts in four of the present appeals have relied on the judgment of this  

Court in coming to the conclusion that the workmen were entitled to regularisation  

in service. In one of the five appeals, however where the prayer for regularisation  

was rejected, the decision in PCLU has been distinguished. Hence on either end  

of the spectrum, the judgment in PCLU has a significant bearing on the outcome  

of the appeals.   

2 The manner in which the present appeals arise is indicated, for  

convenience of reference, in the following tabulation:  

Sl. Nos. Particulars  Remarks   

1 Civil Appeals @ SLP (C)  

Nos. 15971-15998/2018  

ONGC & Ors. v ONGC  

Field Operators Union  

& Ors.  

The appeals arise out of a judgment dated 5  

January 2018 of the Andhra Pradesh High  

Court in 24 Writ Appeals and 4 Writ  

Petitions. The High Court directed  

regularisation of 450 workmen who moved  

the High Court under Article 226 of the  

                                                 1  (2015) 6 SCC 494

3    

Constitution without seeking a reference  

before the Industrial Tribunal under the  

Industrial Disputes Act 1947 2 . The judgment  

of the High Court has relied upon the  

decision of this Court in PCLU (supra).  

2 Civil Appeal @ SLP (C)  

No. 4/2016  

Renumbered as C.A.  

1878/2016  

ONGC v Krishan Gopal  

& Ors.   

The appeal arises out of a judgment dated  

12 December 2015 of the High Court of  

Delhi. Allowing a Letters Patent Appeal, the  

High Court directed regularisation of 24  

workmen who had instituted proceedings  

under Article 226 without seeking a  

reference to the Industrial Tribunal under the  

Industrial Disputes Act 1947. The High Court  

relied upon the decision of this Court in  

PCLU (supra).  

3 Civil Appeal @ SLP (C)  

No. 10478/2016  

M Rajan & Ors. v  

ONGC & Ors.   

The appeal arises from a judgment of the  

Madras High Court dated 20 November  

2015 in Writ Appeals. The High Court  

rejected the prayer for regularisation made  

by the workmen who had instituted  

proceedings under Article 226. The High  

Court held that the remedy under the  

Industrial Disputes Act 1947 could not be  

                                                 2  “ID Act”

4    

bypassed. The High Court distinguished the  

decision of this Court in PCLU (supra).  

4 Civil Appeal @ SLP (C)  

No. 30854/2017  

 ONGC v Tel AVM  

Prakartik Gas  

Karmchari Sangh  

The appeal arises from a decision of the  

High Court of Uttarakhand dated 3 August  

2017 in writ proceedings under Article 226,  

as a consequence of which, nine workmen  

have been directed to be regularised. The  

High Court set aside the award of the  

Industrial Tribunal which had held in favour  

of ONGC, the employer. The High Court  

relied on the decisions of this Court in PCLU  

and in State of Haryana v Piara Singh 3    

(“Piara Singh”). (The decision in Piara  

Singh has been overruled by the  

Constitution Bench of this Court in  

Secretary, State of Karnataka v  

Umadevi 4 ).  

5 Civil Appeal @ SLP (C)  

No. 16455/2018  

The Management of  

ONGC v Petroleum  

Employees Union   

The appeal arises from the judgment of the  

Madras High Court dated 29 January 2018  

by which the services of fourteen  

messengers and three sanitary cleaners  

have been regularised by the High Court.  

The award of the Industrial Tribunal has  

                                                 3  (1992) 4 SCC 118  

4  (2006) 4 SCC 1

5    

been set aside. The High Court has relied  

on the judgment of this Court in PCLU  

(supra).   

3 In the appeals which are listed out at serial Nos 1, 2, 4 and 5 of the table,  

ONGC, as the appellant seeks to challenge the judgments of the High Courts  

directing or, as the case may be, upholding the plea for regularisation on the  

basis of the decision in PCLU. In the appeal at serial No 3, the workmen are  

before this Court against the judgment of the High Court declining to grant the  

relief which was granted to the workmen in PCLU on the ground that they had  

initiated proceedings under Article 226 without availing of the remedy under the  

ID Act.   

 4 Appearing on behalf of the appellant, ONGC, in four appeals in the above  

batch of appeals 5 , Mr P S Narasimha and Mr J P Cama, learned Senior Counsel  

have formulated the following points for determination:  

 (i) Whether the decision of the two judge Bench of this Court in PCLU is per  

incuriam on the ground that it did not consider the binding precedents on the  

interpretation of Item 10 of Schedule V of the ID Act, particularly those in :  

 Mahatma Phule Agricultural University v Nasik Zilla Sheth  

Kamgar Union 6 ;   

                                                 5  Serial Nos 1, 2, 4 and 5  

6  (2001) 7 SCC 346

6    

 Regional Manager, State Bank of India v Raja Ram 7 ;  

 Regional Manager, SBI v Rakesh Kumar Tewari 8 ; and    

 Oil & Natural Gas Corpn. Ltd v Engg. Mazdoor Sangh 9 .  

 (ii) Whether the interpretation which has been placed in PCLU on clause 2(ii) of  

the Certified Standing Orders for contingent employees of ONGC to the  

effect that a temporary workman who has put in 240 days of attendance in  

any period of twelve consecutive months and possesses the minimum  

qualifications is entitled to regularisation, is correct in view of the fact that  

the standing order only provides that the „workman‟ “may be considered for  

conversion as regular employee”;  

 (iii) Whether the view of the High Court of Andhra Pradesh that the principles  

enunciated in the judgment of the Constitution Bench in Secretary, State of  

Karnataka v Umadevi 10

(“Umadevi”) are not applicable to labour law, is  

correct;  

 (iv) What are the ingredients of an unfair labour practice under Item 10 of  

Schedule V of the ID Act; and   

 (v) Whether a finding of an unfair labour practice can be rendered in a  

proceeding under Article 226 of the Constitution without the workmen  

leading evidence in a reference under the ID Act.  

                                                 7  (2004) 8 SCC 164  

8  (2006) 1 SCC 530  

9  (2007) 1 SCC 250  

10  (2006) 4 SCC 1

7    

5 Section 25(T) of the ID Act contains a prohibition against employers,  

workmen and trade unions resorting to unfair labour practices. It provides:  

“25 (T). Prohibition of unfair labour practice – No employer or  

workman or a trade union, whether registered under the  

Trade Unions Act, 1926 (16 of 1926) or not, shall commit any  

unfair labour practice.”  

The expression “unfair labour practice has been defined in Section 2(ra):  

“2(ra) “unfair labour practice” means any of the practices  

specified in the Fifth Schedule.”  

Among the unfair labour practices set out in the Vth Schedule, Item 10 provides  

as follows:  

“10. To employ workmen as “badlis”, casuals or temporaries  

and to continue them as such for years, with the object of  

depriving them of the status and privileges of permanent  

workmen.”     

The decision in PCLU  

 6 ONGC was in appeal against an award of the Industrial Tribunal directing it  

to regularise the services of security guards and supervisors with effect from the  

date on which they had completed 480 days. ONGC had a project in Cauvery  

Basin, Karaikal in the Union Territory of Puducherry. It employed contract  

workmen as security guards and supervisors. On 8 December 1976, contract  

labour was abolished for watch and ward, dusting and cleaning jobs by the  

Government of India under Section 10(1) of the Contract Labour (Regulation and  

Abolition) Act 1970. Under an agreement with the trade unions, the management  

of ONGC utilized the services of the erstwhile contract workmen through a labour

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cooperative society which was formed for the welfare of the contract workmen.  

Subsequently, security work was entrusted to the Central Industrial Security   

Force to protect the installations. The workmen were later on appointed as part of  

watch and ward security on a term basis subject to the condition that the Certified  

Standing Orders would not apply to them. On a demand by the workmen, a  

reference was made to the Industrial Tribunal to adjudicate on whether the  

management was justified in not regularising the workmen and in failing to pay  

equal wages to the workmen, at par with the regular workmen. The dispute about  

the payment of equal wages was resolved by a settlement. The Industrial  

Tribunal made an award directing ONGC to regularise the services of the  

workmen. This was challenged by ONGC before the High Court in writ  

proceedings on the ground that the workmen had been originally selected without  

following any selection procedure, in violation of the decision in Umadevi (supra).  

The workmen claimed that ONGC was guilty of an unfair labour practice in  

continuing them on a temporary basis since 1988. The Writ Petition was  

dismissed by a learned Single Judge. The Division Bench of the High Court  

having dismissed a Writ Appeal, ONGC moved this Court in order to challenge  

the judgment of the High Court.   

7 In appeal, one of the issues was:  

“Whether jurisdiction of the Tribunal to direct the Corporation to regularise  

the services of the workmen concerned in the posts is valid and legal?”.   

 Answering the above issue, this Court held that   

(i) All the workmen (except for one) possessed the qualifications

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required for regularisation; and  

(ii) The workmen had been employed prior to 1985 in posts through  

irregular means.   

8 The Court held that the Industrial Tribunal had the jurisdiction to adjudicate  

upon the dispute and had rightly passed an award directing regularisation of the  

services of the workmen.   

9 The second issue which was dealt with in the judgment in PCLU was:  

“Whether the appointment of the workmen concerned in the services of the   

Corporation is irregular or illegal?”   

 10 On behalf of the Management, it was urged that the initial selection of the  

workmen was not in accordance with the recruitment rules and was illegal in view  

of the judgment of the Constitution Bench in Umadevi. This plea was rejected,  

following the decision in Ajaypal Singh v Haryana Warehousing Corporation 11

and it was held that the management could not deny the rights of the workmen by  

contending that their initial employment was contrary to Articles 14 and 16 of the  

Constitution. The provisions contained in clause 2(ii) of the Certified Standing  

Orders for contingent employees of ONGC were in issue, the management  

contending that there was no right of regularisation merely on the completion of  

240 days in twelve consecutive months.   

                                                 11

(2015) 6 SCC 321

10    

11 Clause 2 of the Certified Standing Orders provides thus :  

“2. (i) Classification of workmen  

The contingent employees of the Commission shall  

hereafter be classified as:  

(a) Temporary, and  

(b) Casual  

(ii) A workman who has been on the rolls of the  

Commission and has put in not less than 180 days of  

attendance in any period of 12 consecutive months  

shall be a temporary workman, provided that a  

temporary workman who has put in not less than 240  

days of attendance in any period of 12 consecutive  

months and who possesses the minimum  

qualifications prescribed by Commission may be  

considered for conversion as regular employee.  

(iii) A workman who is neither temporary nor regular  

shall be considered as casual workman.”  

12 Justice V Gopala Gowda, speaking for the two judge Bench of this Court  

rejected the submission that clause 2(ii) of the Certified Standing Orders does not  

confer a right to regularisation since it employs the words “may be considered for  

conversion as regular employee”. This submission which was based on the  

language of clause 2(ii) was rejected with the following observations:  

“In any case, it is clear that the workmen concerned have  

clearly completed more than 240 days of services  

subsequent to the memorandum of appointment issued by  

the Corporation in the year 1988 in a period of twelve  

calendar months, therefore, they are entitled for  

regularisation of their services into permanent posts of  

the Corporation as per the Act as well as the Certified  

Standing Orders of the Corporation.”   

(Emphasis supplied)  

The Court further held:    

“45. The legal contention urged on behalf of the Corporation  

that the statutory right claimed by the workmen concerned  

under Clause 2(ii) of the Certified Standing Orders of the  

Corporation for regularising them in their posts as regular  

employees after rendering 240 days of service in a calendar

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is not an absolute right conferred upon them and their right is  

only to consider their claim. This plea of the learned Senior  

Counsel cannot again be accepted by us for the reason that  

the Corporation is bound by law to take its decision to  

regularise the services of the workmen concerned as regular  

employees as provided under Clause 2(ii) of the Certified  

Standing Orders after their completion of 240 days of service  

in a calendar year as they have acquired valid statutory right.  

This should have been positively considered by the  

Corporation and granted the status of regular employees of  

the Corporation for the reason that it cannot act arbitrarily and  

unreasonably deny the same especially it being a corporate  

body owned by the Central Government and an  

instrumentality of the State in terms of Article 12 of the  

Constitution and therefore, it is governed by Part III of the  

Constitution.”  

ONGC was accordingly directed to regularise the services of the workmen on  

their completing 240 days of service in a calendar year under clause 2(ii) of the  

Certified Standing Orders, to grant regular pay scale and absorption against  

regular posts. PCLU arose from an adjudication in an industrial reference  

whereas the present proceedings arise from a writ petition under Article 226.  

   13 From the above extract of the decision of this Court in PCLU, it is evident  

that clause 2(ii) of the Certified Standing Orders has been construed to confer a  

right to regularisation on the completion of 240 days of service in a calendar year.  

While construing the provisions of clause 2(ii), an earlier decision of a two judge  

Bench of this Court in Oil and Natural Gas Corporation Limited v Engineering  

Mazdoor Sangh 12

(“Engineering Mazdoor Sangh”) was evidently not brought  

to the notice of the Court. The decision in Engineering Mazdoor Sangh  

construed clause 2 of the Certified Standing Orders specifically in the context of  

                                                 12

(2007) 1 SCC 250

12    

ONGC itself. The decision related to the engagement of seasonal workmen who  

were employed between November and May of the following year for carrying out  

surveys for the exploration of petroleum. The demand of the workmen for  

regularisation on the completion of 240 days was referred to Central Government  

Industrial Tribunal. While the reference was pending, the Union filed a complaint  

under Section 33-A alleging that ONGC was allotting work to contractors in  

preference to the casual/contingent/temporary workmen resulting in the alteration  

of the terms of service. The complaint was adjudicated upon by the Tribunal upon  

which ONGC filed an application seeking permission to terminate the service of  

the workmen. The Tribunal allowed ONGC to terminate some of the workmen.  

The order of the Tribunal directed ONGC to regularise the workmen as an when  

any vacancy arose in a regular post, subject to their completing 240 days‟ work  

and possessing the minimum qualifications. The High Court modified the award  

of the Industrial Tribunal by directing that all employees who completed 240 days  

and possessed the minimum qualifications would be considered at par with  

regular employees. They would be given the status of regular appointees without  

requiring them to compete with other employees drawn from the employment  

exchange. In appeal, this Court observed that regularising the services of all the  

seasonal workmen would create various difficulties and hence the Tribunal had  

found a via media in directing that 153 workmen who had admittedly completed  

240 days and had acquired a temporary status be regularised against vacancies  

as and when such vacancies became available. Thus, this Court found that the  

directions of the Tribunal were reasonable and should prevail instead of the  

directions issued by the High Court. The judgment of the High Court was set

13    

aside and that of the Tribunal was restored.   

 14 Apart from the above decision which arose specifically in the context of  

ONGC, it has been submitted that the decision in PCLU would require  

reconsideration in view of earlier decisions of this Court which have not been  

noticed.   

15 In Mahatma Phule Agricultural University v Nasik Zilla Sheth Kamgar  

Union 13

(“Mahatma Phule Agricultural University”), a Bench of two learned  

judges of this Court construed the provisions of Item 6 of Schedule IV of the  

Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour  

Practices Act 1971 14

, which is in the following terms :  

“14…  

6. To employ employees as „badlis‟, casuals or temporaries  

and to continue them as such for years, with the object of  

depriving them of the status and privileges of permanent  

employees.”  

Construing the above provisions, this Court held :  

“14…The complaint was against the Universities. The High  

Court notes that as there were no posts the employees could  

not be made permanent. Once it comes to the conclusion that  

for lack of posts the employees could not be made  

permanent, how could it then go on to hold that they were  

continued as “badlis”, casuals or temporaries with the object  

of depriving them of the status and privileges of permanent  

employees? To be noted that the complaint was not against  

the State Government. The complaint was against the  

Universities. The inaction on the part of the State Government  

to create posts would not mean that an unfair labour practice  

had been committed by the Universities. The reasoning given  

by the High Court to conclude that the case was squarely  

covered by Item 6 of Schedule IV of the MRTU & PULP Act  

cannot be sustained at all and the impugned judgment has to  

                                                 13

(2001) 7 SCC 346  14

“MRTU and PULP Act”

14    

be and is set aside. It is however clarified that the High Court  

was right in concluding that, as per the law laid down by this  

Court, status of permanency could not be granted. Thus all  

orders wherein permanency has been granted (except award  

dated 1-4-1985 in IT No. 27 of 1984) also stand set aside.”  

There could, in other words, be no regularisation in the absence of posts. Hence,  

there was no unfair labour practice.    

16 In Regional Manager, State Bank of India v Raja Ram 15

(“Raja Ram”),  

another two judge Bench of this Court construed the provisions of Item 10 of  

Schedule V to the ID Act and observed:  

 “9…In other words, before an action can be termed as an  

unfair labour practice it would be necessary for the  

Labour Court to come to a conclusion that the badlis,  

casuals and temporary workmen had been continued for  

years as badlis, casuals or temporary workmen, with the  

object of depriving them of the status and privileges of  

permanent workmen. To this has been added the judicial  

gloss that artificial breaks in the service of such workmen  

would not allow the employer to avoid a charge of unfair  

labour practice. However, it is the continuity of service of  

workmen over a period of years which is frowned upon.  

Besides, it needs to be emphasised that for the practice to  

amount to unfair labour practice it must be found that the  

workman had been retained on a casual or temporary  

basis with the object of depriving the workman of the  

status and privileges of a permanent workman. There is  

no such finding in this case. Therefore, Item 10 in List I of  

the Fifth Schedule to the Act cannot be said to apply at all to  

the respondent's case and the Labour Court erred in coming  

to the conclusion that the respondent was, in the  

circumstances, likely to acquire the status of a permanent  

employee.”  

      (Emphasis supplied)  

   The above decision was followed in Regional Manager, SBI v Rakesh Kumar  

                                                 15

(2004) 8 SCC 164

15    

Tewari 16

.  

 17 The decision of the two judge Bench in PCLU has placed a construction on  

the provisions of clause 2(ii) of the Certified Standing Orders which prima facie  

does not appear to be correct. Besides, the fact that the decision in PCLU has  

not noticed the earlier judgment in Engineering Mazdoor Sangh (supra) which  

pertained to ONGC‟s Certified Standing Orders, we are of the considered view  

that the principles of law which have been expounded in PCLU would require to  

be revisited. The decision in PCLU holds that the workmen upon completion of  

240 days‟ service in a period of 12 calendar months “are entitled for  

regularisation of their services into permanent posts of the corporation”. The  

Court further held that under clause 2(ii), upon the completion of 240 days of  

service in a calendar year, the workmen have “acquired valid statutory right”  

and ought to have been “granted the status of regular employees” of the  

corporation on the ground that the corporation which is an instrumentality of the  

State under Article 12 cannot act arbitrarily or unreasonably. Whether the  

provisions of clause 2(ii) confer an absolute right to regularisation merely on the  

completion of 240 days of service in a calendar year is a point which needs to be  

reconsidered both having regard to the express language of the provision as well  

as the earlier decisions of this Court including that in the case of Engineering  

Mazdoor Sangh.  

18 The second aspect on which we are of the view that the present appeals  

would require to be placed before a larger Bench for consideration is in regard to  

                                                 16

(2006) 1 SCC 530:  at paragraph 25, page 538   

16    

the applicability of the principles set out and formulated by the Constitution Bench  

in Umadevi in the context of industrial adjudication. In Umadevi, the Constitution  

Bench made a distinction between appointments or selections which are merely  

irregular and those which are illegal. The Court observed:  

 “16…We have, therefore, to keep this distinction in mind and  

proceed on the basis that only something that is irregular for  

want of compliance with one of the elements in the process of  

selection which does not go to the root of the process, can be  

regularised and that it alone can be regularised and granting  

permanence of employment is a totally different concept and  

cannot be equated with regularisation.”  

In this context, the Court held :  

“43…It has also to be clarified that merely because a  

temporary employee or a casual wage worker is continued for  

a time beyond the term of his appointment, he would not be  

entitled to be absorbed in regular service or made permanent,  

merely on the strength of such continuance, if the original  

appointment was not made by following a due process of  

selection as envisaged by the relevant rules. It is not open to  

the court to prevent regular recruitment at the instance of  

temporary employees whose period of employment has come  

to an end or of ad hoc employees who by the very nature of  

their appointment, do not acquire any right. The High Courts  

acting under Article 226 of the Constitution, should not  

ordinarily issue directions for absorption, regularisation, or  

permanent continuance unless the recruitment itself was  

made regularly and in terms of the constitutional scheme.”  

In paragraph 53 of the judgment, the Court made a one-time exception, for the  

regularisation of the irregularly appointed persons, who had worked for ten years  

or more in duly sanctioned posts:  

“53. One aspect needs to be clarified. There may be cases  

where irregular appointments (not illegal appointments) as  

explained in S.V. Narayanappa [(1967) 1 SCR 128 : AIR 1967  

SC 1071] , R.N. Nanjundappa [(1972) 1 SCC 409 : (1972) 2  

SCR 799] and B.N. Nagarajan [(1979) 4 SCC 507 : 1980  

SCC (L&S) 4 : (1979) 3 SCR 937] and referred to in para 15

17    

above, of duly qualified persons in duly sanctioned vacant  

posts might have been made and the employees have  

continued to work for ten years or more but without the  

intervention of orders of the courts or of tribunals. The  

question of regularisation of the services of such employees  

may have to be considered on merits in the light of the  

principles settled by this Court in the cases abovereferred to  

and in the light of this judgment. In that context, the Union of  

India, the State Governments and their instrumentalities  

should take steps to regularise as a one-time measure, the  

services of such irregularly appointed, who have worked for  

ten years or more in duly sanctioned posts but not under  

cover of orders of the courts or of tribunals and should further  

ensure that regular recruitments are undertaken to fill those  

vacant sanctioned posts that require to be filled up, in cases  

where temporary employees or daily wagers are being now  

employed.”  

19 The applicability of the decision in Umadevi in the context of labour  

adjudication was considered in UP Power Corporation Ltd. v Bijli Mazdoor  

Sangh 17

(“Bijli Mazdoor Sangh”). This Court held that the law propounded in  

Umadevi was applicable also to Industrial Tribunals and Labour Courts. The  

Court held:  

“6.  It is true as contended by learned counsel for the  

respondent that the question as regards the effect of the  

industrial adjudicators' powers was not directly in issue  

in Umadevi (3) case [(2006) 4 SCC 1 : 2006 SCC (L&S)  

753] . But the foundational logic in Umadevi (3) case [(2006)  

4 SCC 1 : 2006 SCC (L&S) 753] is based on Article 14 of the  

Constitution of India. Though the industrial adjudicator can  

vary the terms of the contract of the employment, it cannot do  

something which is violative of Article 14. If the case is one  

which is covered by the concept of regularisation, the same  

cannot be viewed differently.  

7.  The plea of learned counsel for the respondent that at  

the time the High Court decided the matter, decision  

in Umadevi (3) case [(2006) 4 SCC 1 : 2006 SCC (L&S) 753]  

was not rendered is really of no consequence. There cannot  

be a case for regularisation without there being employee-

employer relationship. As noted above the concept of  

regularisation is clearly linked with Article 14 of the  

                                                 17

(2007) 5 SCC 755

18    

Constitution. However, if in a case the fact situation is  

covered by what is stated in para 45 of Umadevi (3)  

case [(2006) 4 SCC 1 : 2006 SCC (L&S) 753] the industrial  

adjudicator can modify the relief, but that does not dilute the  

observations made by this Court in Umadevi (3) case [(2006)  

4 SCC 1 : 2006 SCC (L&S) 753] about the regularisation.”  

20 Subsequently, in Maharashtra State Road Transport Corporation v  

Casteribe Rajya Parivahan Karmchari Sanghatana 18

(“Maharashtra SRTC”),  

it was held that the Industrial and Labour Courts under Section 30(1)(b) of the  

MRTU and PULP Act have wide powers to direct the employer to take affirmative  

action in a case of unfair labour practice including the power to order  

regularisation or permanency. The decision in Umadevi was held to limit the  

scope of the powers under Articles 32 and 226 to issue directions for  

regularisation in a matter of public employment. However, the power to take  

affirmative action under Section 30(1)(b) was held to be intact even after the  

judgment of the Constitution Bench. This Court held :  

 “35. Umadevi (3) [(2006) 4 SCC 1 : 2006 SCC (L&S) 753]  

is an authoritative pronouncement for the proposition that the  

Supreme Court (Article 32) and the High Courts (Article 226)  

should not issue directions of absorption, regularisation or  

permanent continuance of temporary, contractual, casual,  

daily wage or ad hoc employees unless the recruitment itself  

was made regularly in terms of the constitutional scheme.  

36. Umadevi (3) [(2006) 4 SCC 1 : 2006 SCC (L&S) 753]  

does not denude the Industrial and Labour Courts of their  

statutory power under Section 30 read with Section 32 of the  

MRTU and PULP Act to order permanency of the workers  

who have been victims of unfair labour practice on the part of  

the employer under Item 6 of Schedule IV where the posts on  

which they have been working exist. Umadevi (3) [(2006) 4  

SCC 1 : 2006 SCC (L&S) 753] cannot be held to have  

overridden the powers of the Industrial and Labour Courts in  

passing appropriate order under Section 30 of the MRTU and  

                                                 18

(2009) 8 SCC 556

19    

PULP Act, once unfair labour practice on the part of the  

employer under Item 6 of Schedule IV is established.”  

   The Court however clarified that there is no doubt that the creation of posts does  

not lie within the domain of judicial functions “which obviously pertains to the  

executive” and the status of permanency cannot be granted by the Court where  

no posts exist. In Maharashtra SRTC, the two judge Bench was construing the  

provisions of the MRTU and PULP Act 1971. In holding that the creation of posts  

could not be directed by courts, the judgment in Maharashtra SRTC relied upon  

the decisions in Mahatma Phule Agricultural University (supra) and State of  

Maharashtra v R S Bhonde 19

.  

21 The divergence between the decisions in Bijli Mazdoor Sangh and  

Maharashtra SRTC was sought to be reconciled in a two judge Bench decision  

of this Court in Hari Nandan Prasad v Employer I/R to Management of Food  

Corporation of India 20

(“FCI”). Justice A K Sikri, speaking for the two judge  

Bench held:  

 “39. On a harmonious reading of the two judgments  

discussed in detail above, we are of the opinion that when  

there are posts available, in the absence of any unfair labour  

practice the Labour Court would not give direction for  

regularisation only because a worker has continued as daily-

wage worker/ad hoc/temporary worker for number of years.  

Further, if there are no posts available, such a direction for  

regularisation would be impermissible. In the aforesaid  

circumstances giving of direction to regularise such a person,  

only on the basis of number of years put in by such a worker  

as daily-wager, etc. may amount to back door entry into the  

service which is an anathema to Article 14 of the Constitution.  

Further, such a direction would not be given when the worker  

                                                 19

(2005) 6 SCC 751  20

(2014) 7 SCC 190

20    

concerned does not meet the eligibility requirement of the  

post in question as per the recruitment rules. However,  

wherever it is found that similarly situated workmen are  

regularised by the employer itself under some scheme or  

otherwise and the workmen in question who have  

approached the Industrial/Labour Court are on a par with  

them, direction of regularisation in such cases may be legally  

justified, otherwise, non-regularisation of the left-over workers  

itself would amount to invidious discrimination qua them in  

such cases and would be violative of Article 14 of the  

Constitution. Thus, the industrial adjudicator would be  

achieving the equality by upholding Article 14, rather than  

violating this constitutional provision.”  

22 In FCI, the grievance of the appellants was that in terms of a scheme  

contained in a circular, similarly placed workmen had been regularised on the  

completion of 240 days‟ service. While dealing with the case of two workmen, it  

was found that one of them had been dispensed with four years prior to the date  

of the circular as a result of which the workman would only be entitled to  

monetary compensation. On the other hand, the second workman was in service  

on the date of the circular and completed 240 days of service within a few  

months. The Court held that the failure to regularise his services was  

discriminatory.   

23 The following propositions would emerge upon analyzing the above  

decisions:  

(i) Wide as they are, the powers of the Labour Court and the Industrial  

Court cannot extend to a direction to order regularisation, where such a  

direction would in the context of public employment offend the  

provisions contained in Article 14 of the Constitution;   

(ii) The statutory power of the Labour Court or Industrial Court to grant

21    

relief to workmen including the status of permanency continues to exist  

in circumstances where the employer has indulged in an unfair labour  

practice by not filling up permanent posts even though such posts are  

available and by continuing to employ workmen as temporary or daily  

wage employees despite their performing the same work as regular  

workmen on lower wages;  

(iii) The power to create permanent or sanctioned posts lies outside the  

judicial domain and where no posts are available, a direction to grant  

regularisation would be impermissible merely on the basis of the  

number of years of service;   

(iv) Where an employer has regularised similarly situated workmen either in  

a scheme or otherwise, it would be open to workmen who have been  

deprived of the same benefit at par with the workmen who have been  

regularised to make a complaint before the Labour or Industrial Court,  

since the deprivation of the benefit would amount to a violation of  

Article 14; and  

(v) In order to constitute an unfair labour practice under Section 2(ra) read  

with Item 10 of the Vth Schedule of the ID Act, the employer should be  

engaging workmen as badlis, temporaries or casuals, and continuing  

them for years, with the object of depriving them of the benefits  

payable to permanent workmen.      

 24 The decision in PCLU needs to be revisited in order to set the position in  

law which it adopts in conformity with the principles emerging from the earlier line  

of precedent. More specifically, the areas on which PCLU needs reconsideration

22    

are:  

(i) The interpretation placed on the provisions of clause 2(ii) of the  

Certified Standing Orders;  

(ii) The meaning and content of an unfair labour practice under Section  

2(ra) read with Item 10 of the Vth Schedule of the ID Act; and   

(iii) The limitations, if any, on the power of the Labour and Industrial Courts  

to order regularisation in the absence of sanctioned posts. The decision  

in PCLU would, in our view, require reconsideration in view of the  

above decisions of this Court and for the reasons which we have noted  

above.   

 25 We accordingly request the Registry to place the proceedings before the  

Hon‟ble Chief Justice of India so as to enable His Lordship to consider placing  

this batch of appeals before an appropriate Bench.               

                                                     …….………….…………………...........................J.  

                           [DR DHANANJAYA Y CHANDRACHUD]  

…….…………………………...............................J.          [AJAY RASTOGI]  

New Delhi;   February 07, 2020.