Case Brief: Indian Oil Corporation Ltd vs. Shri Chanda Ram Meena & Anr.

INTRODUCTION

The case of Indian Oil Corporation Ltd vs Shri Chanda Ram Meena and Anr, resolved by the Rajasthan High Court in 2023, addresses a longstanding issue in labor law: the distinction between an ‘apprentice’ and a ‘workman’, and the applicability of the Industrial Disputes Act, 1947 to those employed under apprenticeship agreements. “The petitioner, Indian Oil Corporation Limited (IOCL), challenged an award from the Central Government Industrial Tribunal-Cum-Labour Court in Jaipur, which ordered the reinstatement of the respondents and their classification as workmen. IOCL contended that the respondents were engaged solely as apprentices on a fixed-term basis under the Apprentices Act, 1961, and therefore general labor laws, including the Industrial Disputes Act, 1947, did not apply to them. However, the respondents asserted that they performed workmen’s duties and claimed that the apprenticeship contracts were used as an unfair labor practice to deny them their rights as regular employees. This ruling examines the precedence of the Apprentices Act, 1961—a special Act governing apprentices—over general law established by the Industrial Disputes Act, 1947”. It reaffirms the legal standing regarding apprentices’ status and the jurisdiction of Industrial Tribunals in this context.

FACTS

The case originated from a complaint filed by the Indian Oil Corporation Limited (IOCL) against the respondents, Shri Chanda Ram Meena, Shri Narendra Singh Shekhawat, and Shri Ram Kishan Meena. “The names of the respondents were sponsored by the Jaipur Employment Exchange for an 11-month training session at IOCL’s Company Owned & Company Operated (COCO) Retail Outlet. Each respondent and IOCL signed an apprenticeship agreement that outlines the training terms and conditions for a duration of 11 months. According to these terms, the association was aimed at training, would last for 11 months, would involve both theoretical and practical training for 8 hours each day, and would offer a monthly stipend of Rs. 1664/-. Significantly, the contract stipulated that there would be no employer-employee relationship, the respondents would not receive benefits available to regular employees, and IOCL would not be obligated to employ them after training, despite awarding a certificate. Upon the end of the 11-month period, the apprenticeship contracts ended automatically, resulting in a cessation of training for the respondents.

They claimed to have worked as labourers or petrol fillers (respondents Narendra Singh and Chanda Ram on June 2, 2000, and respondent Ram Kishan on December 7, 2001), asserting that they had been in service for more than 240 days and that their employment was unlawfully terminated without following the procedures outlined in Sections 25F and 25H of the Industrial Disputes Act, 1947. In its reply, IOCL denied the existence of an employer-employee relationship, asserting that the respondents were trainees under a specific scheme without any guarantee of absorption. The Tribunal ruled that the respondents were workmen who had provided over 240 days of service, and their dismissal violated the Industrial Disputes Act. It directed their reinstatement with continuity of service and payment of 50% back wages. This award was transferred by IOCL to the Rajasthan High Court”.

ISSUE RAISED

• The inclusion of individuals who were employed under an apprenticeship contract as defined by the Apprentices Act, 1961, in the term ‘workman’ as per “Section 2(s) of the Industrial Disputes Act, 1947”. 
• Whether the provisions of the Industrial Disputes Act, 1947 (a general labor legislation) apply to or relate to apprentices governed by the Apprentices Act, 1961 (a special statute). 
• Whether the Central Government Industrial Tribunal-Cum-Labour Court had the necessary jurisdiction under the Industrial Disputes Act, 1947, to adjudicate a claim petition submitted by individuals working as apprentices under the Apprentices Act, 1961. 
• Whether the Tribunal made a mistake by overlooking the apprenticeship contracts and other documents provided by the employer in assessing the respondents’ status as apprentices instead of workmen.

PETITIONER’S ARGUMENTS

Indian Oil Corporation Limited (IOCL), the petitioner, primarily argued that the respondents were engaged solely as ‘apprentices’ under a specific training scheme and bound by an apprenticeship contract with a fixed duration of 11 months. They were trainees, not ‘workmen’, and therefore did not fit the definition of ‘workman’ as per the Industrial Disputes Act, 1947. IOCL emphasized that “Section 18 of the Apprentices Act, 1961”, explicitly states that apprentices are trainees rather than workers, and that the provisions of any law concerning labor do not apply to such apprentices. They contended that the Apprentices Act of 1961 is a special law that takes precedence over the general provisions of the Industrial Disputes Act of 1947. IOCL contended that the Industrial Tribunal exceeded its jurisdiction by treating the respondents as workmen and ordering their reinstatement under the Industrial Disputes Act, as disputes concerning apprentices are governed by the Apprentices Act, 1961, and any remedies must be pursued under that act, typically through the Apprenticeship Adviser. They noted that documentary evidence, like the apprenticeship agreements, clearly characterized the engagement as training, a point the Tribunal did not comprehend.

RESPONDENT’S ARGUMENTS

The claimants (respondents) in front of the Tribunal opposed IOCL’s assertions, stating that under the Industrial Disputes Act of 1947, they should be regarded as ‘workmen.’ They argued that they were performing tasks typical of workmen, such as filling petrol, rather than merely undergoing training. The respondents contended that IOCL was utilizing the apprenticeship agreements as an unequal labor practice to avoid granting regular workmen status and benefits. They would have argued that despite being ‘apprentices’, the true nature of their work indicated an employer-employee relationship under the definition of ‘workman’ in “Section 2(s) of the Industrial Disputes Act, 1947, which states that “any person (including an apprentice) employed in any industry” is included. They would have contended that after serving for more than 240 days, their dismissal without following the procedures outlined in Sections 25F and 25H of the Industrial Disputes Act was unlawful, thereby supporting the Tribunal’s reinstatement and arrears order. The respondents relied on the Tribunal’s finding that they were workmen and argued for a limited scope of interference by the High Court under Article 226 of the Constitution”.

JUDGEMENT

Upon hearing the arguments and reviewing the relevant statutory provisions and precedents, the Rajasthan High Court granted the writ petitions filed by Indian Oil Corporation Limited and annulled the award of the Central Government Industrial Tribunal-Cum-Labour Court. The Court decided that the terms of the Apprentices Act, 1961, which is a special law concerning apprentices, would take precedence over the general provisions of the Industrial Disputes Act, 1947. The ruling was based on and cited the Supreme Court’s decision in “U.P. State Electricity Board v. Shiv Mohan Singh and Ors.”, which had definitively determined that apprentices under the 1961 Act are considered trainees rather than workmen, and that labor law provisions do not apply to them.

The Court noted that “Section 18 of the Apprentices Act, 1961 explicitly prohibits the application of labor laws concerning apprentices. Consequently, the Court ruled that the respondents, employed as apprentices under legitimate apprenticeship contracts, could not be classified as ‘workmen’ according to the Industrial Disputes Act of 1947. The Industrial Tribunal lacked the jurisdiction to consider their claim petition under the Industrial Disputes Act of 1947. The Tribunal was found by the Court to have erred in disregarding the clear terms of the apprenticeship contracts as well as the legal standing of apprentices under the Apprentices Act, 1961”.

CONCLUSION 

The judgment of the Rajasthan High Court in the case of Indian Oil Corporation Ltd vs Shri Chanda Ram Meena and Anr reaffirms the established legal understanding regarding apprentices and the fact that general labor laws do not apply to them when they are employed under the Apprentices Act, 1961. The Court decisively ruled that the Apprentices Act, 1961, is a special law that takes precedence over the general Industrial Disputes Act, 1947, in cases concerning apprentices. By referencing and deriving authority from the Supreme Court’s decision in “U.P. State Electricity Board v. Shiv Mohan Singh”, the High Court reiterated that individuals undergoing apprenticeship training under the 1961 Act are classified as trainees rather than workmen, regardless of the nature of their duties during training or the inclusion of “apprentice” in the definition of “workman” in the Industrial Disputes Act. “Section 18 of the Apprentices Act” specifically excludes the application of labor laws to such apprentices, which is a key factor in determining their legal status and available remedies.

According to the ruling, Industrial Tribunals or Labour Courts established by the Industrial Disputes Act of 1947 lack the authority to address disputes involving apprentices whose appointments are governed by the Apprentices Act of 1961. Disputes that arise during the apprenticeship or in relation to it shall be resolved using the mechanisms provided by the Apprentices Act, typically involving the Apprenticeship Adviser. The ruling of the Court underscores the importance of accurately identifying the nature of the relationship based on the governing law and the agreement, clarifying that performing tasks similar to those of workmen does not automatically classify an apprentice as a workman if the engagement is clearly one of training under the Apprentices Act. The Tribunal’s award reservation shows that claims for reinstatement and arrear wages under the Industrial Disputes Act were misplaced, as the appropriate legal framework and jurisdiction for addressing issues related to apprentices fall under the Apprentices Act, 1961.