MANAGING DIRECTOR HASSAN CO-OPERATIVE MILK PRODUCERS SOCIETY UNION LIMITED Vs. THE ASSISTANT REGIONAL DIRECTOR EMPLOYEES STATE INSURANCE CORPORATION

JUDGEMENT

(1.) THE appellant is a co -operative society which seeks to question the order of the Employees' State Insurance Court, Mysore (hereinafter referred to as 'the ESI Court' for brevity) holding that the society is liable to make contribution in respect of employees engaged in the transport of milk.

(2.) THE primary contention is that the employees engaged in the transportation of milk are in fact employed by the immediate employer, who is a contractor, who has entered into a contract with the society and in terms of the agreement, there is no act of supervision or control in respect of those employees and the ESI Court has read certain clauses in the agreement to hold that there is supervision and control and that the society is bound to make contribution in respect of the employees. The fact that one of the officials of the society was permitted to travel in the vehicle engaged for transport of milk or who was found guilty of misconduct or misbehaviour could not be, by any stretch of imagination, be held to be under the supervision and control of the society, thereby rendering the society liable to make contribution in respect of such employee. In this regard, the counsel would rely on the judgment of the Supreme Court in the case of Calcutta Electricity Supply Corporation (C.E.S.C.) Ltd. and Ors. v. Subhash Chandra Bose and Ors, 1992 I L.L.N. 353 and submits that the meaning of the word "employee" has to be construed in a manner which does not rule out the function and role of immediate employer or obliterating the distance between the principal employer and the immediate employer. The Supreme Court has held that same is the situation of one who stumbles in the way of direct nexus being established, unless statutorily fictioned, between the employee and the principal employer. He is the one who in a given situation is a principal employer to the employee, directly employed under him. If the work by the employee is conducted under the immediate gaze or overseeing of the principal employer, or his agent, subject to other conditions as envisaged being fulfilled, he would be an employee for the purpose of Section 2(9). In the light of this opinion of the Supreme Court, the counsel for the appellant would submit that mere is no immediate supervision by the principal employer in respect of the employees of the immediate employer in the facts of the case and hence, there is no liability to make contribution in respect of such employees.

(3.) THE appellant further relies on the case of Tata Tea Ltd, Bangalore v. E.S.I. Corporation, Bangalore, 2000 I LLJ 117. That was a case where the tea company had entrusted the work of packing tea to the contractor. The workers and the tea company had no manner of control or supervision of such employees nor did have the right to reject the items brought from outside agency if it was found wanting in quality as per job specification. This, the court held, could not be on act of supervision and that the contractor was not immediate employer for purposes of the Act. This decision again, would not help the appellant. In the instant case on hand, the finding by the ESI Court that there is control exercised by the employer over the employees engaged by the contractor is a finding of fact and this cannot be said is without any basis and the reasonings of the court below with reference to the material on record and therefore, I do not find any ground for interference.