APMC v. Weighmans Asson

8/3/2019 APMC v. Weighmans Asson.

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MANU/KA/8150/2006

Equivalent Citation: ILR2006KAR3320, (2006)IIILLJ454KantIN THE HIGH COURT OF KARNATAKA AT BANGALORE

Writ Petition Nos. 10290 and 45880 of 1999 and 20256 of 2001

Decided On: 29.05.2006

Appellants: Agricultural Produce Market CommitteeVs.

Respondent: The Weighmen's Association and Ors.Hon'ble Judges:

N. Kumar, J.Counsels:

For Appellant/Petitioner/Plaintiff: B.G. Sridharan, Adv. in W.P. No. 10290 of1999, S.Z.A Kureshi, Additional Government Adv. in W.P. No. 45880 of 1999

and H.K. Thimme Gowda, Adv. in W.P. No. 20256 of 2001For Respondents/Defendant: B.G. Sridharan, Adv. for Respondent 3 in W.P. No.

45880 of 1999, S.Z.A. Khureshi, Additional Government Adv. for Respondents 2

and 3 in W.P. No. 10290 of 1999, P.S. Rajagopal, Adv. for Respondent 1 in W.P.

Nos. 10290 and 45880 of 1999 and P.S. Rajagopal and K. Puttegowda, Advs. forRespondent 3 in W.P. No. 20256 of 2001

Subject: Labour and IndustrialCatch Words

Mentioned INActs/Rules/Orders:

Minimum Wages Act, 1948 - Section 2, Minimum Wages Act, 1948 - Section2(1), Minimum Wages Act, 1948 - Section 3(1), Minimum Wages Act, 1948 -

Section 5, Minimum Wages Act, 1948 - Section 12, Minimum Wages Act, 1948 -Section 20, Minimum Wages Act, 1948 - Section 27, Minimum Wages Act, 1948 -

Section 72, Minimum Wages Act, 1948 - Section 73, Minimum Wages Act, 1948 -Section 74, Minimum Wages Act, 1948 - Section 79A;Karnataka Agricultural

Produce Marketing (Regulation) Act, 1966 ;Karnataka Shops and EstablishmentsAct, 1961 - Section 2, Karnataka Shops and Establishments Act, 1961 - Section

2(19A), Karnataka Shops and Establishments Act, 1961 - Section 3; KarnatakaAgricultural Produce Marketing Committee Rules, 1961;Agricultural Produce

Marketing Committee Act ;Karnataka Agricultural Produce Marketing (Regulation)Rules, 1968 - Rule 79; Constitution of India - Article 226

Cases Referred:Raghunath and Ors. v. State of Karnataka and Ors. 2000 (2) Kar. L.J. 237 : ILR

2000 Kar. 277Disposition:

Petition allowedCase Note:

(A) KARNATAKA AGRICULTURAL RODUCE MARKETING COMMITTEE ACT,

1966 - SECTIONS 2(e) 5, 12, 27-KARNATAKA SHOPS AND COMMERCIALESTABLISHMENT ACT, 1961-SECTION 3-Whether the APMC Yard falls

within the schedule employment under the provisions of the Karnataka

Shops Commercial Establishment Act, 1961-HELD-APMC Act was enactedto provide for better regulation of the marketing of agricultural produce

and the establishment and administration of markets for agriculturalproduce in the State of Karnataka and with that object in mind they have

established these markets. Therefore, the establishment falls within thedefinition of 'Commercial Establishment' under the Shops and
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Establishments Act. Section 3 of the Shops and Commercial EstablishmentAct specifies the category of shops to which the said Act is not applicable.

As is clear from Section 3(l)(a), the Act shall not apply to officers ofCentral or State Government or Local Authority only commercial

undertakings. Therefore, even if the APMC is the local authority, even if itis to be held that it is not a commercial undertaking, even then, only the

officers appointed by the APMC are excluded from the application of thisAct.In other words, the workers and employees who are not officers areentitled to payment of minimum wages under the Act. The criterion is if

the establishment has employed such persons. Therefore, the contention

that the Minimum Wages Act is not applicable to APMC and as the APMCas such is not mentioned in the schedule to the Shops and Commercial

Establishment Act, is not applicable is without any substance. If the APMCemploys any person mentioned in the Schedule, then they are liable to

pay the minimum wages under the Act.

(B) KARANTAKA AGRICULTURAL PRODUCE MARKETING COMMITTEE ACT,1966 - SECTIONS 2(i) 2(19-A), 72, 79-A-KARNATAKA AGRICULTURAL

PRODUCE MARKETING (REGULATION) RULES, 1968-RULE 79-Whether the

weighman of the APMC Yard are the employer under the Act-HELD-Therelationship between the petitioner and the weighman in the APMC yard,it is case of contract for service and not contract ofservice. There exists no

relationship of master and servant between the APMC and the weighman.The relationship is that of a licensor and licensee. Therefore, what is paid

by the APMC Yard to the weighman is not wages. Weighman are notemployed in the APMC yard. They are neither employed for hire or reward,

to do any work, by the APMC. Therefore, as the weighman do not satisfythe definition of employee as contained in Section 2(i) of the Act, the Act

is not applicable to the weighman. Therefore, seen from any angle havingregard to the material on record, the law declared by this Court in the

aforesaid judgment, it is not possible to hold that these weighmen are

employees under the Act, and that they are entitled to minimum wagesunder the Act. As such their claim for fixing the minimum rates of wages

has to fail.Held:

The aforesaid definition makes it very clear that, an employee is a person who isemployed for hire or reward to do any work in a scheduled employment. Employer

is one who employes whether directly or through another person in any scheduled

employment. Therefore, the employment of a person in a scheduled employmentis the determining factor. If there is no such employment, then such a person

cannot claim to be the employee of the APMC. Under the Act, weighman is amarket functionary. He is a licence holder permitted to carry on trade/ vocation in

the market area. The licence has to be renewed from time to time on payment offree prescribed. The market committee has not issued any appointment order to

the weighman, employing him as their employee. There is no obligation cast onthe market committee to pay any fee, charge, consideration, remuneration, much

less, salary to the weighman. There exists no jural relationship of master andservant or employer and employee. When the relationship is disputed, the burden

of proof is on the workman to establish the employer and employee relationship.The question whether the relationship between the parties is one of employer and

employee is a pure question of fact. Where a person asserts the relationship and itis denied by the employer, it is for the employee and not for employer to prove the

fact. The employee has to plead and prove the relationship of employment


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between him and the employer in relation to establishment by adducing evidencebefore the Tribunal. Once that evidence is adduced, the status of the employee

has to be covered as a matter of law from the facts found and if the questioninvolved is one of drawing a legal inference as to the status of a party from the

facts found, thsi it is not a pure question of fact, but necessarily becomes a mixedquestion of facts of law. It is useful to remember in this context the difference

between the contractforservice and contractofservice.A contractofservice is one in which a person undertakes to serve the industryand to obey its rasonable orders withinthe scopre of the duty he undertaiks. The

distinction is, in the one case the master can order or require what is to be done,

while in the other case, he cannot only order or require what is to be done, buthow itself is shall be done. Under a contractofservice a man is employed as a

part of business and his work is done as a integral part of the business, whereas,under a contractforservice, his work, although done for the business, is not

integrated into it but is only accessory to it. The test of being a servcant does notrest on subission to orders. It depends on whether the person is part and parcel of

the organistion.

Writ Petitions allowed.

ORDERN. Kumar, J.1. The weighmen who are working at APMC Yard at Tumkur and Tiptur have

formed a Union. Through their Union they filed an application before theCompetent Authority under Section 20 of the Minimum Wages Act, 1948 (for

short, "the Act"). They contend that the APMC Yard is their employer within themeaning of Section 2(e) of the Act. In the schedule attached to the application

they have given the particulars of wages paid to them, the difference between theminimum wages payable and the wages actually paid and they have sought for

compensation of 50% of the difference in the minimum wages. On service ofnotice, the Agricultural Produce Marketing Committee (for short, 'APMC') entered

appearance. They specifically contend that the weighmen, the members of the

applicant-association are neither employees employed by the APMC nor the APMCis an employer within the meaning of the Act. These weighmen who carry on the

business are hot employees and the incidents of employment such as monthlysalary, allowances, provident fund, gratuity, bonus, periodical increments, ESI

facility, etc., are not at all attracted. On the contrary, they are market functionarywho carry on business under the provisions of Karnataka Agricultural Produce

Marketing (Regulation) Act of 1966 (hereinafter referred to as the 'APMC Act').

They are on par with other businessmen such as Trader, Commission Agent,Exporter, Importer, Processor, Broker, etc. They obtain licence from the Market

Committee for each area, and are performing their functions as weighmen andthey are not paid salary or wages by the Market Committee as they are not

employed by them. They also contend that the APMC is not a scheduleemployment as defined under Section 12 of the Act. Therefore, the Act itself is not

applicable to these applicants and sought for dismissal of the said application.2. Both the parties adduced evidence, produced documents, relied on the

judgment of this Court rendered in connection with the claim of weighmen ofAPMC Yard at Bangalore. On consideration of all these materials, the authority

under the Act, held that the "weighmen" are workmen or employee of the APMC,within the meaning of Section 2(e) of the Act. They are not paid the minimum

wages under the Act and accordingly they are entitled to the difference of wagesclaimed by them, and allowed both the claim applications. Aggrieved by the same,

the APMC Yard, Tumkur, APMC Yard, Tiptur and Director of Agricultural Marketing
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in Karnataka, have preferred these writ petitions. As common questions of lawarise for consideration, in these writ petitions, they are heard together and

disposed of by this common order.3. The learned Counsel for the petitioner, Sri B.C. Sreedharan contend, firstly that

for application of Section 12 of the Act, their establishment should fall within theschedule employment under the provisions of the Act. Though, earlier they fell

within the purview of the Act by virtue of the notification issued on 29-7-1976,subsequently, as it was deleted by virtue of notification dated 19-8-1987, the Actis not applicable at all. Secondly it was contended that as these weighmen are

expected to function after obtaining licence from the APMC they are not employed

by the APMC and are not employees as defined under the Act. Therefore, theControlling Authority had no jurisdiction to entertain the claim much less pass the

impugned award granting relief.4. Per contra, the learned Counsel for the respondent Sri P.S. Rajagopal contended

that it is a fact that the earlier notification was withdrawn. But the reasons givenfor withdrawal of the notification makes it very clear that as the APMC Yard is

covered under the provisions of the Karnataka Shops and CommercialEstablishments Act, 1961. Insofar as the status of the weighmen is concerned, he

submits that though under the APMC Act and APMC Rules, 1961 they are expected

to obtain licence before functioning in the Yard, the evidence on record, the natureof duties they perform, the way they are paid remuneration and the law on thepoint coupled with the decision of this Court in the case of weighmen of Bangalore,

1968 APMC Yard makes it very clear that notwithstanding the nomenclature ofthese weighmen they are employees under the Act and therefore, the provisions of

the Act is attracted. Admittedly, they have not been paid the minimum wagesprescribed in law and therefore, the authorities are fully justified in directing

payment of difference in the wages as well as the compensation. As the authorityhas properly appreciated the oral and documentary evidence on record and has

recorded finding of fact, it is not open for this Court to interfere with the saidfinding under Article 226 of the Constitution of India, in view of the fact that the

Act is a beneficial piece of social welfare legislation and when the benefit of that

legislation has been extended to these unorganized working class, he prayed fordismissal of the writ petition.

5. From the aforesaid facts and rival contentions, the point that arise forconsideration in these writ petitions are as under:

(1) Whether the APMC Yard falls within the schedule employment under the

provisions of the Karnataka Shops and Commercial Establishments Act, 1961?

(2) Whether the weighmen of the APMC Yard are the employees under the Act?

(3) Whether the impugned orders passed by the Controlling Authority directingpayment of difference in wages along with compensation requires to be interfered

with?

6. Point No. 1.--Section 12 of the Act provides for payment of minimum rates ofwages. It provides that in respect of any scheduled employment, a notificationunder Section 5 is in force, the employer shall pay to every employee engaged in a

scheduled employment under him wages at a rate not less than the minimum rateof wages fixed by such notification for that class of employees in that employment

without any deductions except as may be prescribed. Section 5 of the Act dealswith the procedure for fixing and revising minimum wages. Before a claim is made

for fixation of minimum wages as notified under Section 5 of the Act, theemployment should be a scheduled employment. The word scheduled employment
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has been defined under the Act at Section 2(g)meaning, an "employment specifiedin the Schedule of any process or branch of work forming part of such

employment". Section 27 of the Act provides that the appropriate Governmentafter giving notification in the Official Gazette, not less than three month's notice

of its intention so to do, may, by like notification add, to either Part of theSchedule any employment in respect of which it is of opinion that minimum rates

of wages should be fixed under this Act and thereupon the Schedule shall in itsapplication to the State be deemed to be amended accordingly.7. The Government of Karnataka by Gazette Notification No. SEL 99 LMW 75,

dated 29-7-1976 added the following to the schedule to the Act.--

39. Employment in regulated market, mandies, bazars and other similar places.However, the Government of Karnataka while considering fixation of the minimum

wages to the Schedule employment, issued another Notification No. LD 37 LMW93, dated 28-2-1994, thereby deleted the aforesaid item to the schedule on the

ground that the category of the workers in the notification are covered under theschedule of shops and commercial establishment. The Government was of the

opinion that the process of the regulated markets are duly covered under theschedule employment 'shops and commercial establishments' to which the

minimum wages are fixed.

8. Therefore, it is clear that the liability to pay the minimum rates of wages is cast

on the employer whose employment is one of the scheduled employment underthe Act. The schedule attached to the Act, provides the employment which are

covered under the Act. The employment in regulated market, mandies, bazars andother similar places were included in the schedule by virtue of Section 27 of the

Act, by a notification dated 29th July, 1976, published on 30th July, 1976 in theKarnataka Gazette at item No. 39, employment in regulated markets, mandies,

bazars and other similar places was added. However, by notification dated 28thFebruary, 1984, published on 15th March, 1994, the same came to be deleted on

the ground the employees employed by APMC are covered under the provisions ofthe Shops and Commercial Establishments Act, which is already included in the

schedule as employment to which the Act applies.9. The notification dated 19th August, 1987 fixed the minimum rates of wages for

the employees engaged in any kind of work in the Shops and Commercial

Establishment through out the State of Karnataka. Sl. No. 4 in Group 5 of the saidnotification deals with weighman.

10. The argument is, in the schedule to the Shops and Establishments Act, there is

no mention about the employment in regulated market, mandies, bazars and othersimilar places and therefore the liability to pay the minimum wages to an

employee of the APMC is not attracted. The said argument is though attractive onthe face of it is without any substance. It is true that as in the case of Item No. 39

to the schedule to the Minimum Wages Act, 1948, after deletion, identical item isneither introduced in the schedule to the Shops and Establishments Act nor is

available. A reading of the schedule to the Shops and Establishments Act makes itclear that it provides for payment of minimum wages to various persons

mentioned in the said schedule such as Manager, Accountant, Supervisors,Stenographers, Clerk, Cashier, Typist, Salesman, Bill-collector, Watchman,

Messenger, Weighing-man, Peon, etc. Therefore, if any of those persons areemployed by the APMC then they are liable to pay the minimum wages if the

establishment is a commercial establishment. The words "CommercialEstablishment" has been defined under Section 2(e) of the Shops and
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Establishments Act which reads as under:2(e) "Commercial establishment" means a commercial or trading or banking or

insurance establishment, an establishment or administrative service in which personsemployed are mainly engaged in office work, a hotel, restaurant, boarding or eating

house, a cafe or any other refreshment house, a theatre or any other place of publicamusement or entertainment and includes such establishments as the State

Government may by notification declare to be a commercial establishment for thepurposes of this Act.11. APMC Act was enacted to provide for better regulation of the marketing of

agricultural produce and the establishment and administration of markets for

agricultural produce in the State of Karnataka and with that object in mind theyhave established these markets. Therefore, the establishment falls within the

definition of 'Commercial Establishment' under the Shops and Establishments Act.Section 3 of the Shops and Commercial Establishments Act specifies the category

of shops to which the said Act is not applicable. As is clear from Section 3(1)(a),the Act shall not apply to officers of Central or State Government or Local

Authority only commercial undertakings. Therefore, even if the APMC is the localauthority, even if it is to be held that it is not a commercial undertaking, even

then, only the officers appointed by the APMC are excluded from the application of

this Act. In other words, the workers and employees who are not officers areentitled to payment of minimum wages under the Act. The criterion is if theestablishment has employed such persons. Therefore, the contention that the

Minimum Wages Act is not applicable to APMC and as the APMC as such is notmentioned in the schedule to the Shops and Commercial Establishments Act, is not

applicable is without any substance. If the APMC employs any person mentioned inthe Schedule, then they are liable to pay the minimum wages under the Act.

12. Point No. 2.--The question is whether the weighmen are employees of APMC,In order to find out the status of weighmen in the APMC Yard, we have to look into

the provisions of the Act and the Rules framed thereunder. The word 'weighmen'has not been defined under the Act. However the word 'weighment' has been

defined which includes 'counting' or 'measurement'. Section 72 of the Act deals

with the meaning of licence. Once such person to whom licence is granted underSection 72 is a weighmen, The aforesaid provisions provides that on an application

made by any person in the prescribed form and after making such enquiries as itdeems fit, the Market Committee grants or renews licence for the use of any place

in the market area for the sale of the notified agricultural produce or for operatingtherein as a trader, commission agent, broker, processor, weighmen, measurer,

surveyor, warehouseman or any other market functionary in relation to the

marketing of agricultural produce, or may, after recording its reasons in writingtherefor, refuse to grant or renew any such licence. Section 73 deals with the

power to cancel or suspend licences. Section 74 provides for remedy to aggrievedpersons whose licence has been suspended or cancelled.

13. Rule 79 of the Karnataka Agricultural Produce Marketing (Regulation) Rules,

1968 (for short hereinafter referred to as the "Rules") provide that no person shalloperate as a weighmen, measurer, surveyor, hamalis, cartmen, owner of publiccarrier or as any other market functionary in any market area except under a

licence in Form 37 granted by the Market Committee. A weighmen who wantslicence should apply in Form 44, and he shall also pay such fee not exceeding

rupees one hundred as may be specified in the bye-laws for grant of such licence.If the APMC does not find any ground to refuse any such licence they shall grant

licence in Form 37. On issue of such licence, the licensee shall execute anagreement in such form as the Market Committee may determine, agreeing to
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comply with these rules and the bye-laws of the Market Committee. The durationof the licence is till the end of the market year in which it has been granted. It is

liable to be renewed after the expiry of the said period. However, no person shallbe entitled to do business as a market functionary other than that for which he

holds a licence. One of the prerequisite for grant of licence as a weighmen is, heshould not be in employment of another person or firm who has been granted a

licence by the committee. Suppressing the said fact if any licence is obtained, itamounts to breach of conditions of licence and the committee reserved the powerto cancel the said licence after hearing the said licensee.

14. Sub-section (19-A) of Section 2 defines Market Charges, which means all

charges in connection with the handling of agricultural produce such as thecommission of commission agents, brokerages, remuneration for weighment,

loading, unloading, cleaning, sorting, counting, sieving and dressing of agriculturalproduce. Section 79-A of the Act provides that all market charges payable after

the sale of the agricultural produce shall be recovered from the buyer. Therefore,it is clear that the remuneration for weighment made by weighmen falls within the

definition of market charges and is payable by the buyer. The rates at which thesaid weighment charges are payable are prescribed under the bye-laws.

15. This Court had an occasion to consider whether a weighman employed by aMarket Committee constituted under APMC Act is an employee of that committee.

After noticing the various provisions of the APMC Act and the rules framed thisCourt in the case of Raghunath and Ors. v. State of Karnataka and Ors.

MANU/KA/0104/2000 : ILR2000KAR277 has held as under:Having regard to the functions of the Weighman as a market functionary, as

envisaged and enumerated in the Act and the Rules, it cannot be said that therelationship between the Market Committee and a Weighman is that of an

employer and employee. He is only a licence holder permitted to carry on atrade/vocation in the market area. In the discharge of some of his functions, he

may at best be an agent of the Market Committee. The market functionary has anobligation to pay licence fee to the Market Committee. But there is no obligation

on the Market Committee to pay any fee, charge, consideration, remuneration,much less a salary to any market functionary under the Act. When the relationship

is not that of employer and employee, the question of the Weighmen requiring the

Market Committee to pay a minimum wage to them does not arise.

The petitioners contend that the work of Weighmen is constantly supervised by the

Market Committees, that the Market Committees allot the work to them; that

apart from the work assigned to them by the respective Market Committees, theycannot operate independently in the market yard; that they are accountable to the

Market Committee in regard to their work; that their hours of work and manner ofwork are regulated by the Market Committees; and that therefore there is a

relationship of employer and employee between the Market Committee and theWeighmen and such relationship ought to have been recognised, if not for the

purpose of other enactments, but at least for the purpose of applying theminimum wages to such Weighmen. It should however be remembers that the

supervision, control and regulation, which is referred to by the petitioner isapplicable not only to Weighmen, but all categories of market functionaries. The

Market Committees are statutory Authorities established for supervising,controlling and regulating the marketing and merely because the Market

Committee exercises supervisory control over the Weighmen, it cannot be saidthat the same would result in relationship of employer and employee. Having

regard to the provisions of the Act and the Rules, Weighmen are licensed market
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functionaries discharging the functions specified in the Act, Rules and therespective Bye-laws of the Market Committee, and it is not possible to hold that

the Weighmen have any position or stands other than licensed marketfunctionaries.

16. Learned Counsel for the respondent relied on several judgments of the

Supreme Court in support of his contention that notwithstanding the fact thatthese weighman have to obtain licence under the Act and Rules perform the

functions of weighman, if we look into the evidence on record, the nature of workthey carry on, the type of control the Market Committee exercise over these

weighman, the remuneration they receive for the work they perform and the way

the business is carried on in the market yard it is clear that they are workmenemployed by the Market Committee to perform the work on weighing in the

market yard. They work from morning to evening and every day the MarketCommittee specifies the shop/place where they have to carry on their functions

and after weighing the commodities it is they who make entry in the bookmaintained for the said purpose and in the end of the day the committee collects

money from the buyers and payments are made once in a month to all theseweighmen. In the event of these weighmen not reporting to work in time, not

performing their work according to the stipulations the committee initiatesdisciplinary action. These undisputed facts would clearly show that these

weighmen are employed by the committee and the committee has completecontrol and supervision over these weighmen and therefore the contention that

there is no relationship of employer and employee has no substance.

17. Before the Controlling Authority, both the parties have adduced evidence to

substantiate their respective contentions. Witnesses on behalf of the MarketCommittee have categorically stated the procedure prescribed for obtaining

licence, the fee to be paid for obtaining the licence, issue of licence, how thecontract is entrusted to these weighmen and what are the powers APMC exercises

in respect of these weighmen and the nature of control they do possess againstthese weighmen. On behalf of the weighmen evidence has been adduced to show

that they are expected to report at the market yard at a particular hour and theyworked throughout the day, every day they are assigned to a shop where they

carry on their function, if there is any default in performance of their function

notices have been issued calling upon them to show cause why action should notbe taken, they are not paid money directly by the buyer for the work they

perform, the money is collected by the APMC and once in a month payments are

made etc.

18. Similar evidence and contentions were considered by this Court in the

aforesaid judgment and it was held that, notwithstanding all these material, inview of the statutory provisions and settled legal position these weighmen cannot

be considered as employees as defined under the Act. In respect of weighmen ofAPMC Yard at Bangalore, in terms of the direction issued by this Court a scheme

was formulated and in terms of the scheme certain benefits are given to theweighmen. In the aforesaid judgment this Court has held that weighmen who are

working at APMC Yard, Bangalore, cannot be treated on par with the weighmenwho are working at other APMC Yards. Even in the aforesaid judgment of the

Division Bench on which reliance is placed by this Court it has not been held thatweighmen at APMC Yard at Bangalore are employees and that they are entitled to

be paid minimum wages. Having regard to the volume of work turned out in APMCYard at Bangalore, and in view of the provisions contained in the scheme, probably


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in the end of the day the total remuneration or commission they receive per montheither is equal to the minimum wages or more than that. That is because, as held

in the aforesaid judgment in APMC Yard at Bangalore, the work is there throughoutthe year and large quantity of products are sold, where as in other APMC yard the

work is seasonal and quantity which is turned out has no comparison to thequantity of business which is turned out in APMC, Bangalore, Therefore, the said

judgment is of no assistance.

19. In this context it is also necessary to look into the definition of employeecontained in the Act. Section 2(i)defines "employee" as under;

2(i) "Employee" means any person who is employed for hire or reward to do any

work, skilled or unskilled, manual or clerical, in a scheduled employment in respectof which minimum rates of wages have been fixed; and includes an out-worker to

whom any articles or materials are given out by another person to be made upcleaned, washed, altered, ornamented, finished, repaired, adapted or otherwise

processed for sale for the purposes of the trade or business of the other personwhere the process is to be carried out either in the home of the out-worker or in

some other premises not being premises under the control and management of thatother person; and also includes an employee declared to be an employee by the

appropriate Government; but does not include any member of the Armed Forces ofthe Union.

The aforesaid definition makes it very clear that, an employee is a person who isemployed for hire or reward to do any work in a scheduled employment. Employer

is one who employs whether directly or through another person in any scheduledemployment. Therefore, the employment of a person in a scheduled employment

is the determining factor. If there is no such employment, then such a personcannot claim to be the employee of the APMC. Under the Act, weighman is a

market functionary. He is a licence holder permitted to carry on trade/vocation inthe market area. The licence has to be renewed from time to time on payment of

fee prescribed. The Market Committee has not issued any appointment order tothe weighman, employing him as their employee. There is no obligation cast on

the Market Committee to pay any fee, charge, consideration, remuneration, muchless, salary to the weighman. There exists no jural relationship of master and

servant or employer and employee. When the relationship is disputed, the burden

of proof is on the workman to establish the employer and employee relationship.The question whether the relationship between the parties is one of employer and

employee is a pure question of fact. Where a person asserts the relationship and it

is denied by the employer, it is for the employee and not for employer to prove thefact. The employee has to plead and prove the relationship of employment

between him and the employer in relation to establishment by adducing evidencebefore the Tribunal. Once that evidence is adduced, the status of the employee

has to be covered as a matter of law from the facts found and if the questioninvolved is one of drawing a legal inference as to the status of a party from the

facts found, then it is not a pure question of fact, but necessarily becomes a mixed

question of facts and law. It is useful to remember in this context the differencebetween the contractforservice andcontractofservice.A contractofservice is one in which a person undertakes to serve the industry

and to obey its reasonable orders within the scope of the duty he undertakes. Thedistinction is, in the one case the master can order or require what is to be done,

while in the other case, he cannot only order or require what is to be done, buthow itself it shall be done. Under a contractofservice a man is employed as a

part of business and his work is done as an integral part of the business, whereas,under a contractforservice, his work, although done for the business, is not
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integrated into it but is only accessory to it. The test of being a servant does notrest on submission to orders. It depends on whether the person is part and parcel

of the organisation.20. If we apply these tests to the facts of this case, the relationship between the

petitioner and the weighman in the APMC yard, it is caseofcontractforservice and not contractofservice. There exists no relationship

of master and servant between the APMC and the weighman. The relationship isthat of a licensor and licensee. Therefore, what is paid by the APMC yard to theweighman is not wages, Weighman are not employed in the APMC yard. They are

neither employed for hire or reward, to do any work, by the APMC. Therefore, as

the weighman do not satisfy the definition of employee as contained inSection 2(1) of the Act, the Act is not applicable to the weighman. Therefore, seen

from any angle having regard to the material on record, the law declared by thisCourt in the aforesaid judgment, it is not possible to hold that these weighmen are

employees under the Act, and that they are entitled to minimum wages under theAct. As such, their claim for fixing the minimum rates of wages has to fail.

21. In view of my findings the impugned orders passed by the ControllingAuthority are one without jurisdiction and that these weighmen as they are not

employees under the Act are not entitled to payment of minimum wages under the

Act. Hence, I pass the following order:

Writ petitions are allowed. The impugned orders passed by the ControllingAuthority are hereby quashed. Parties are directed to bear their own costs.

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APMC v. Weighmans Asson