Published On: 25th May 2025
Authored By: Aditi Yashasvi
Amity Law School, Noida
Special Civil Application No. 2151 of 1966; Decided on December 19, 1967[1]
IN THE HIGH COURT OF BOMBAY
Kolhapur Sugar Mills, Ltd. …Petitioner Company
Versus
Syed Taki Bilgrami and Another …Respondent 1 & 2 (President of Industrial Court &
Trade Union of Employees of Petitioner Company)
Facts of the case
Kolhapur Sugar Mills Ltd. owned 1,135 acres of land but retained only 79 acres after land ceiling laws were passed in Maharashtra. So, the company relied on ‘private cultivators’ for meeting its sugarcane needs. Then, a trade union demanded equal wages for harvesters and cartmen involved in the process of manufacturing of sugar. The industrial court ruled in favor of the union, leading to this company’s writ petition. Below are the propositions and Preliminary Objections put forward by the Parties in question-
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Sl. No |
Sri Narayanaswami, for the petitioner-company (Propositions) |
Sri Kulkarni, appeared for Respondent 2 (Preliminary Objections) |
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1. |
The notice of change served by Respondent 2 on the ‘petitioner-company’ stating that the demands in question is lawful only with respect to the workers employed on lands which are owned by the petitioner-company itself, but not with respect to the workers employed on lands owned by private cultivators. |
Present petition not maintainable by reason of ‘non-joinder’ of the Maharashtra State Farming Corporation (MSFC). |
Reason for rejection Maharashtra State Farming Corporation was a ‘proper-party’ and therefore cannot be made a ‘necessary party’ for the sake of this petition. |
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2. |
The ‘Industrial court’ had no jurisdiction to entertain a ‘reference’ on behalf of the contractors employed on the lands of other ‘private-cultivators’. |
The question of master and servant was a question of fact which cannot be dealt with in a writ petition |
Reason for rejection Mixed question of fact and law
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3. |
Notification No. 1131-45 has not been properly and correctly construed by the industrial court.
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The award of the industrial court in this case on certain admissions on affidavit made by the ‘petitioner-company’ before the industrial court, this court should not interfere with the same. |
Reason for rejection Court did not consider this as an objection and stated that the conclusions made then, based on the affidavit, might tripe in this petition. |
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4. |
Assuming that the said notification is applicable to this case, the award fixing the method of payment of wages stands contrary to the demands.
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This petition is not maintainable, as there is no prima-facie error apparent on record. |
Reason for rejection This objection is only applicable to a writ of Certiorari, which is not the only relief sought by the petitioner, so cannot question the maintainability as whole. |
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All the above propositions dealt with below! |
Rejected all the above four preliminary objections
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Key Issues of the case and respective Judgements on it
- Issue 1: What are the agricultural or industrial operations which are mentioned in Clause (11) of the said notification, required to be connected?
Para 14 of the Judgement: The Court states that- In our opinion, the answer to that question, which appears from the very language of the said clause, is, that the connection that should be established must be with the ‘manufacture of sugar and its by products’, which is referred to as the said ‘manufacture’ in that clause.
- Obtaining raw materials is a vital and essential part of the business aspect of any industry, and, in the present case, it is obvious that unless the ‘petitioner-company’ obtains raw material i.e., sugarcane it is not possible to crush it or manufacture sugar from it.
- It may be mentioned that difficulties have arisen in procuring sugarcane as a result of the bringing into force of the Maharashtra Agricultural Lands (Celling on Holdings) Act, 1861, as well as by the emergence of the co-operative sector in the industry. The petitioner-company has, therefore, in order to ensure the regular supply of sugarcane to keep its mills going, entered into certain arrangements with private cultivators, the sugarcane grown on its own land of only 79 acres being barely sufficient to constitute one and a half days’ crushing requirements of its own mills.
Conclusion: In the view which we take of the matter, it is unnecessary for us to refer to the various clauses or provisions of the said agreements in detail, but it is suffice to say that the practice which the ‘petitioner-company’ followed by those agreements for the purpose of procurement of sugarcane from the lands of ‘private cultivators’ illustrations that there was a nexus or connection between the harvesting and transport of sugarcane from the lands of those private cultivators and the manufacture of sugar and its by-products by the petitioner-company.
If one analyses Clause (11) of the said notification, it is quite clear that it deals-
- with all agricultural operations, or
- with all industrial operations,
- which are connected with the manufacture of sugar and its by products, or
- which are connected with the growing of sugarcane on farms belonging to or attached to concerns engaged in the manufacture of sugar and its byproducts.
Para 15 of the Judgement: Of the possible permutations and combinations that could arise on an analysis of the said clause, we are, therefore, left only with two, namely, that the manufacture of sugar and its byproducts includes all agricultural operations connected with that manufacture; and also includes all industrial operations connected with that manufacture. So construed, the manufacture of sugar and its byproducts; which would include these two operations; would so include them even if those operations are carried out on lands of others, and not on the lands of the manufacturer himself, and that is quite clear from the fact that the notification has been expressly drafted in that manner.
Held: Therefore, Cort held that harvesting and carting operations carried on for the purpose of procuring sugarcane for the petitioner-company’s mills were “connected with” the manufacture of sugar and its by-products therein, and the mere fact that they were not carried out on the petitioner-company’s own lands makes no difference in the matter.
- Issue 2: Whether the employment of contractors and their teams of workers for the purpose of procuring sugarcane from the lands of private-cultivators could be said to be ‘part of the undertaking concerned’ of the petitioner-company within the terms of S. 3(14)(c) of the Bombay Industrial Relations Act, 1916?
Para 16 of the Judgement: It is necessary to analyze the various Ingredients of that note carefully for the purpose of deciding this question, and, when so analyzed, the note (of the notification) should be read as follows: “All service/employment connected with the conduct of the above Industry shall be deemed part of the Industry when engaged in that Industry/by an employer engaged in that Industry.”
Para 17 of the Judgement: In the view that we take of the matter, namely, that the case of the contractors and their teams of workers falls within the first alternative regarding persons who are engaged in the Industry.
Held: In our opinion, this antithesis shows that the words “engaged In” that industry should be construed to apply, no matter by whom the employee has been engaged. In that view of the matter, the contractors and teams of workers would be a “part of the industry” within the note to the notification, dated 4 October 1652, and was hold accordingly.
Evidence: The harvesting and carting of sugarcane from the lands of private cultivators for the purpose of ensuring continuity of the supply of sugarcane to the mills of the petitioner-company “is very essential” during the crushing season for the purpose of the smooth working of the said mills for all 24 hours. This would also show that those operations are part, and Indeed, a very essential part, of the undertaking of the petitioner-company.
Held: We, therefore, hold that the harvesting and transport operations carried on for the purpose of procuring sugarcane from the lands of private cultivators are part of the undertaking of the petitioner-company within the terms of section 3(14)(e) of the 1946 Act.
- Issue 3: In order to constitute the petitioner-company, an employer within the terms of the definition in B. 3(14)(c) of the Bombay Industrial Relations Act, 1946, it is, however, further necessary to show that the contractors were engaged by the petitioner-company for work which was “ordinarily” part of the undertaking concerned.
Para 18 of the Judgement: The real question which we must, therefore, consider is what has been the practice followed by the petitioner-company in the matter of harvesting and carting of sugarcane from the fields of ‘private-cultivators’.
Evidence: The procedure adopted by the company in procuring its sugarcane supply from cultivators has been the same “from the very beginning.” It is also an admitted position that the petitioner-company entered into long-term contracts for periods of seven years for that purpose.
Held: These admitted facts leave no room for doubt whatsoever that the work in question was work which was ordinarily part of the undertaking of the petitioner-company, and we hold accordingly.
Conclusion: In view of these conclusions at which we have arrived, the questions which were formulated by Sri Narayanaswami in the form of propositions (1), (2) and (3) stated at the beginning of this judgment must all be decided against the petitioner-company and it must be held that the contractors and their teams of workers, who were engaged in the harvesting and transport of sugarcane to the mills of the petitioner-company from the lands of private cultivators, were employees of the petitioner-company, that the petitioner-company was their employer, and that those operations are included within the industry of manufacture of sugar and its byproducts, by virtue of the notification dated 4 October 1952.
- Issue 4: the contention of Sri Naravanaswami before us that the Industrial court should not have proceeded to split the fixing of wages as between harvesting and carting operations. Sri Naravanaswami has also contended that the Industrial court fell into a further error in thereafter proceeding to apply the kovta system to harvesting operations.
Petitioner’s Argument: The statement of claim filed before it only sought to demand daily wage at the rate payable to unskilled employees of the petitioner-company, whereas the award proceeded to fix the daily wage for harvesters engaged in the operations in question according to the koyta system which, the petitioner-company has contended, was never followed by it.
Held: There is no material whatsoever placed before us on behalf of the petitioner-company to show that, in fixing wages on that basis separately for harvesters and for cart men instead of fixing a composite wage for them as in annexure F to the petition, and then proceeding to fix wages for harvesters according to the koyta system, any prejudice has been caused to the petitioner-company. Under these circumstances, we see no reason why we should interfere in this matter on a writ petition. Hence, Petition dismissed!
Impact of the Case
The ‘Kolhapur Sugar Mills case’ established that workers hired through contractors for integral operations are ‘employees’ of the principal employer. This precedent is crucial in the ongoing ‘Bombay High Court suo-motu case on migrant workers’ rights in 2024. Amid rising exploitation, the court is assessing ‘wage disparities’ and harsh employment conditions. By recognizing these indirect employment relationships, the judgment aids in securing a standard system of fair wages and working conditions for migrant workers, reinforcing employer accountability in industries that is reliant on contractual labor.
Reference:
[1] 1967 SCC OnLine Bom 173
