No contempt action against FCI: To establish ‘civil contempt’, disobedience of order should be wilful, deliberate & with full knowledge of consequences

Supreme Court: A Division Bench of A.M. Khanwilkar and Dinesh Maheshwari, JJ., while addressing a contempt petition held that,

“…to constitute civil contempt, it must be established that disobedience of the order is wilful, deliberate and with full knowledge of consequences.”

Grievance

Non compliance of direction to Food Corporation of India to regularise and departmentalise workers concerned who had initiated industrial disputes before Industrial Tribunal, Chennai under Section 10(1)(d) of Industrial Disputes Act.

The employees concerned were employed as daily-rated labour or casual labour and had been working for some time with some cases of 15 to 20 years.

Contempt Petition against FCI

FCI contended that it had already regularised the eligible employees who were under Direct Payment System (DPS) and nothing further was required to be done.

Further the Corporation stated that claim was restricted to regularisation of the employees concerned after abolition of the contract labour system. There was no prayer for absorbing the concerned employees under any specific system of regular labour prevailing in the Corporation. The Corporation has four systems of labour engagement, namely, (i) Departmental Labour System, (ii) Direct Payment System, (iii) No­-Work-­No-­Pay System and (iv) Mate System.

Corporation’s Stand

In the decision of SAIL v. National Union Waterfront Workers, (2001) 7 SCC 1 (Constitution Bench), it was held that, contract labour need not be absorbed after abolition of contract labour system.

Taking reference from the above, Corporation stated that the provision of FCI and its primary duty is to undertake purchase, storage, movement, transport, distribution and sale of food grains and other food stuff.

Continuing its’ contention, Corporation stated that, If all the regular workers in the Corporation are brought under the Departmental Labour System, there will be recurring liability on public exchequer to the tune of Rs 3,000 crore per annum and if arrears are also given with effect from 2003, there will be additional financial burden of more than Rs 40,000 crore.

As per the extant policy, the respondent could have regularised the workers concerned only under theDirect Payment System and therefore, it is certainly not a case of disobedience, much less wilful or deliberate disobedience of the order passed by this Court.

Decision of the Court

Bench adverted to the exposition of Supreme Court’s decision in Ram Kishan v. Tarun Bajaj, (2014) 16 SCC 204, wherein the Court had delineated the contours for initiating civil contempt action.

Excerpts from the referred SC decision:

“…in order to punish a contemnor, it has to be established that disobedience of the order is “wilful”. The word “wilful” introduces a mental element and hence, requires looking into the mind of a person/contemnor by gauging his actions, which is an indication of one’s state of mind.”

“Even if there is a disobedience of an order, but such disobedience is the result of some compelling circumstances under which it was not possible for the contemnor to comply with the order, the contemnor cannot be punished.”

Court in the present case observed that, neither the relief in the References was specific for regularisation in Departmental Labour System only nor the Tribunal, the Madras High Court/Kerala High Court or this Court was called upon to deal with that issue specifically.

Subject References, as well as, the direction issued by the Tribunal, which has been upheld upto this Court is silent about the system in which the concerned workers have to be regularised and departmentalised, therefore, it is incomprehensible as to how it would be a case of disobedience.

Therefore, Court held that, no specific direction had been given to the Corporation to regularise the workmen concerned only in the Departmental Labour System.

Furthermore, the Departmental Labour System is now a dying cadre and the policy of the Corporation at the relevant time entailed regularisation of such workmen only under the Direct Payment System (DPS).

Hence, no contempt action can be initiated on the basis of general direction to the respondents to regularise and departmentalise the concerned workmen.

Petition stands dismissed in the above view. [Workmen v. Ravuthar Dawood Naseem, 2020 SCC OnLine SC 461 , decided on 19-05-2020]

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