Holding

Hundekaris may be registered as employers under Clause 14 only if they own the vegetable market or have ultimate control over, or are entrusted with, the affairs of the establishment; otherwise registration is invalid.

Summary

The dispute concerned whether Hundekaris, who act as clearing agents in vegetable markets, could be registered as "employers" under Clause 14 of the Vegetable Markets Unprotected Workers (Regulation of Employment and Welfare) Scheme, 1985, made under the Maharashtra Mathadi, Hamal and Other Manual Workers Act, 1969. The Mathadi workers' union argued that Hundekaris were not employers within the meaning of Section 2(3) of the Act and therefore could not register. The State Government, after consulting the Advisory Committee, held that Hundekaris were entitled to register as owners. The Supreme Court examined the definitions of "employer", "principal employer", "contractor" and the requirements of Clause 14 and Form A, concluding that registration is permissible only when the Hundekari owns a market or has ultimate control over or is entrusted with the affairs of the establishment. Consequently, any Hundekari lacking such control cannot be registered as an employer and existing registrations in such cases must be cancelled. The Court allowed the appeal in part, directing the respondent to decide registrations accordingly.

Issues considered

Whether Hundekaris constitute "employers" within the meaning of sub‑section (3) of Section 2 of the Maharashtra Mathadi Act, 1969.
Whether Hundekaris are entitled to register under Clause 14 of the Vegetable Markets Unprotected Workers Scheme, 1985.
Interpretation of Clause 14 and Form ‘A’ with respect to the requirement of ownership or ultimate control of an establishment.

Legislation cited

Bombay Shops and Establishments Act, 1948
Maharashtra Mathadi, Hamal and Other Manual Workers (Regulation of Employment and Welfare) Act, 1969s. 2(2), s. 2(3), s. 2(7), s. 4(1), s. 5

Subjects

employer definitionregistrationHundekariMathadi Actvegetable marketsunprotected workersClause 14schemecontrol over establishmentcontractor vs employer

Judgment

A MAHARASHTRA RAJYA MATHADI TRANSPORT AND
CENTRAL KAMGAR UNION
v.
STATE OF MAHARASHTRA AND ORS.

MAY 1, 1995
B
[KULDIP SINGH, N. VENKATACHALA AND
S. SAGHIR AHMAD, JJ.)

Maharashtra Mathad~ Hamal and other Manual Workers (Regulation ' '
c of Employment and Welfare) Act, 1969-Vegetable Markets Unprotected
Workers (Regulation of Employment and Welfare) Scheme, 1985-Clause
14-11.egistration of Hundekaris as employers-Claim of-Whether Hun-
dekaris as a class are employers within meaning of sub-sec (3) of section
2-Held, No.
D
Hundekaris wanted to get themselves registered as employers with
the Vegetable Markets Labour Board of Greater Bombay under clause 14
of the Vegetable Markets Unprotected Workers (Regulation of Employ-
ment and Welfare) Scheme, 1985, made by the Government of
Maharashtra under section 4(1) of the Maharashtra Mathadi, Hamal and
E other Manual Workers (Regulation of Employment and Welfare) Act,
1969. The appellant union of Mathadi workers objected to registration of
Hundekaris with the Board as employers on the ground that they were not
the employers as envisaged by the Act and hence they were not also
employers who were entitled to get registered under clause 14 of the
F Scheme. The Maharashtra Government, to resolve the dispute between
Hundekaris and Mathadi workers took a decision dated 6-1- 1989 that as
per the provisions of Section 2(3) of Mathadi Act and rule 14 of the scheme
hundekaris were operating as clearing agents they were having a right and
empowered to get themselves registered as 'owners'. This decision was
challenged by the Mathadi workers by filing Writ Petition. The High Court
G dismissed the petition. Hence this appeal.

The question raised for consideration was whether the Government
was right in reaching the conclusion that 'Hundekaris' as a class were • r
employers within the meaning of sub section (3) of Section 2 of the Act and
H clause 14 of the Scheme.
920
M.R.M.TI'T. AND C.K.UNION v. STATE [VENKATACHALA,J.] 921 ·

Allowing the appeal partly, this Court A

HELD : The Vegetable Markets Labour Board of Greater Bombay
can register Hnndekaris, by whatever name they may be called, under
clause 14 of the Scheme as the employers only where it is established that
they are the owners of the vegetable markets or establishments where they
are carrying on the business either having ultimate control over such B
establishments or being entrnsted with the carrying on the affairs of such
markets or establishiµent and otherwise. If any of the Hundekaris, by
whatever name may be called, are registered as employers under clanse 14
of the Scheme not being the owners of the vegetable markets or estab-
lishments in the areas concerned having either ultimate control over them C
or being entrnsted with the carrying on the affairs of the same, their
registration is liable to be cancelled. [931-B, CJ

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7415 of
1994.
D
From the Judgment and Order dated 26.8.93 of the Bombay High
Court in W.P. No. 510 of 1989.

K.K. Singhvi, B.N. Singhvi and Rajeev Kumar Singh for the Appel-
lants.
E
H.N. Salve, AB. Bhasme, Girish Kedia, Ramesh Singh, Rakhi Varma
and Ms. Bina Gupta for the Respondents.

The Judgment of the Court was delivered by
)
VENKATACHALA, J. Are 'Hundekaris' entitled to get registered F
with the Vegetable Market Labour Board of Greater Bombay - "the Board"
as "Employers" under Clause 14 of the Vegetable Markets Unprotected
Workers (Regulation of Employment and Welfare) Scheme, 1985- "the
Scheme" made by the Government of Maharashtra under Section 4(1) of
the Maharashtra Mathadi, Hamal and Other Manual Workers (Regulation G
of Employment and Welfare) Act, 1969- "the Act" is the short question
~- I that arises for our consideration in this appeal by special leave filed by
Mathadi Workers Union - the appellant.

The factual background in which the said question arises for our
consideration is the following: H
922 SUPREME COURT REPORTS [i995] 3 S.C.R.

A Mathadi workers are the members of the appellant-Union. They are
unprotected workers who carry out the manual work in vegetable markets f
(including onions and potatoes markets) connected with loading, unload-
ing, stacking, carrying, weighing, measuring, filing, stitching, sorting, clean-
ing of vegetables -. a scheduled employment specified under the Act. That
on January 1, 1985, the Government of Maharashtra made a scheme
B respecting that scheduled employment, as envisaged by Section 4 of the
Act. Clause 14 of that Scheme required every employer to get himself
registered with the Board. Hundekaris wanted to get themselves registered
as employers with the Board, claiming that the provision in Clause 14
entitled them to get registered with the Board. The appellant-Union of
' '
C Mathadi workers objected to registration of Hundekaris with the Board as
employers on the ground that they were not the employers as envisaged by
the Act and hence they were not also employers who were entitled to get
registered under Clause 14 of the Scheme. Indeed, the Maharashtra
Government by its Order dated February 16, 1987 directed the Board not
D to register Hundekaris as employers under Clause 14 of the Scheme.
However, later, the Government of Maharashtra sought to resolve the said
dispute between Hundekaris and Mathadi workers under Section 5 of the
Act taking note of an observation of the High Court in an order made on
27.7.1987 in a writ petition filed by respondent-2. But, the Government
being under an obligation to consult the Advisory Committee constituted
E under the Act in resolving a dispute under Section 5 of the Ac!, its view
in the matter was sought for. The Advisory Committee which examined the
matter was of the view that Hundekaris were not entitled to get themselves
registered with the Board as employers under Clause 14 of the Scheme.
Yet, the Government took a decision on Jannary 6, 1989, purporting to be
F that reached in consultation with the Advisory Committee and on hearing '
the parties concerned. The decision so taken on Jannary 6, 1989 was as
follows:-

"DECISION OF THE GOVERNMENT :
.
G In supersession of the Government orders dated 16.2.1987 and
following section 5 and in consonance with the orders of the High I .,.
Court dt. 27.7.1987 the Government is now giving orders that as
per the provisions under section 2(3) of Mathadi Act 1969 and
rule 14 of the scheme framed in 1985 hundekaries are operating
H as clearing agents they are having a right and empowered to get
M.R.M.TPT.ANDC.K.UNIONv. STATE[VENKATACHALA,J.] 923

themselves registered as 'owners'. For this hundekaries should A
apply to the board in form 'A' and the Board as per the provisions
of the Mathadi Act and the Scheme should take appropriate
"'·
decision on the rights of hundekaries.

By orders and in the name of the Governor.
B
Sd!- Ramakant Asmar
Asst!. Secretary to the Govt."

~
, The said decision was challenged by the Mathadi workers through their
Union, the appellant, by filing Writ Petition No. 510/89 before the Bombay
High Court. Since, a Division Bench of that High Court dismissed the Writ
c
Petition by its judgment dated August 26, 1993, the correctness of that
judgment is challenged in this appeal, giving rise to the aforesaid question
requiring our consideration.

We have heard learned counsel appearing for parties in this apl?"al. D
., Whether a scheme formulated under the Act applies to any class Of
unprotected workers or employers, it is true, is a matter on which the State
Government could take a decision in consultation with the Advisory Com-
mittee constituted under the Act, as provided for under-section 5 of the
E
Act. The decision taken in the matter. by the State Government dated
January 6, 1989, which is excerpted by us earlier, undoubtedly, enables
Hundekaris to get themselves registered with the Board as employers. As
seen from the decision of the State Government, it is the provisions ill
Section 2(3) of the Act and Clause 14 of the Scheme which have made it
to reach the conclusion that Hundekaris are entitled to be registered as F
the employers for the purpose of the Act and the Scheme. When that
decision has given rise to the question under consideration, what requires
our examination is whether the Government was right in reaching the
conclusion that 'Hundekaris' as a class are employers within the meaning
of sub-section (3) of Section 2 of the Act and Clause 14 of the Scheme and
G
whether the High Court was right in upholding such conclusion.
~
... I Whether every Hundekari is an employer within the meaning of
Section 2(3) of the Act could be examined first.·

Section 2(3) is a definition clause. It defines 'employer' thus: H
924 SUPREME COURT REPORTS (1995] 3 S.C.R.

A "(3). 'employer', in relation to any unprotected worker engaged
by or through contractor, means the principal employer and in
relation to any other unprotected worker, the person who has
ultimate control over the affairs of the establishment, and includes
any other person to whom the affairs of such establishment are
.entrusted, whether such person is called an agent, manager or is
B called by any other name prevailing in the scheduled employment;"

According to the above definition of 'employer' he may be (i) an
employer of an unprotected worker engaged by or through a contractor,
that is, the principal employer, (ii) an employer of any other unprotected
' .
C worker, that is, a person who has the ultimate control over the affairs of
the establishment or the person to whom the affairs of such establishment
are entrusted whether such person is called an agent, manager or by any
other name prevailing in the scheduled appointment.

D When section 2(7) defines 'principal employer' as meaning an
employer who engages unprotected workers by or through a contractor in
any scheduled employment, principal employer can be classified or
described as 'employer' when he engages unprotected workers by or
through contractor of the scheduled employment.

E When it comes to an employer of any other unprotected worker to
be classified or described as 'employer' he must be a person who has
ultimate control over the affairs of the establishment, i.e., a place or
premises or precincts in which any part of scheduled employment is being
or ordinarily carried on (see section 2(4)) or any agent, manager or the
F like prevailing in the scheduled employment to whom the affairs of the
establishment are entrusted.

Who is a 'mathadi worker' and who is a 'contractor' require an
examination before examining as to who is a 'Hundekari'.

G A 'mathadi worker' is an unprotected worker in the 'scheduled
employment' - an employment specified in the Schedule to the Act, i.e.,
'employment in vegetable markets (including onions and potato markets)
in connection with loading, unloading, stacking, weighing, measuring,
'.
'

sewing, stitching, sorting, cleaning or such other work preparatory on
H incidental to such operations, is undisputed.
M.R.M.TPT. AND CK.UNION v. STATE [VENKATACHAIA, J.] 925

A 'contractor' as defined in Section 2(2) of the Act is a person who A
undertakes to execute any work for an establishment by engaging un-
protected workers on hire or otherwise or who supplies such workers either
in groups or gangs (tollis) or as individuals and includes a sub-contractor,
a mukadum, a tolliwalla.

Whal, therefore, remains for examination is whether a 'Hundekari'
B
is an employer falling in either of the two classes of employers covered by
the definition of employer in Section 2(3) of the Act or a contractor as
defined in Section 2(2) of the Act, i.e., a person who undertakes to execute
any work for an establishment by engaging unprotected workers on hire or
otherwise or who supplies such workers either in groups, gangs (tollis) or C
as individuals and includes a sub-contractor, a mukadum or a tolliwala.

A 'Hundekari' is not a contractor within the meaning of Section 2(2)
of the Act, but is an employer within the meaning of Section 2(3) of the
Act according to the High Court, as seen from its judgment under appeal, D
which runs thus:

"Clearing agents are generally known as Hundekaris. The goods
which are sent by the agriculturist or vegetable produce market
Committee are sent to the Hundekaris who personally remain
present at odd hours of the night and receive vegetables and fruits E
which come to the city by railway, trucks and other modes of
transport. Hundekaris engage labour for the work of loading and
unloading of such goods. After receipt of the goods, hundekaris
despatch these goods to the concerned commission agent or trader
) in the market. If the goods are stolen or spoiled or are not F
delivered in time, the hundekaris are responsible for the loss. They
hold professional licenses of the Municipal Corporation and also
pay professional tax. They also hold a license from the agricultural
produce market committee. They also have their own independent
establishment and they act as clearing agents between the farmers
at the village level and the traders in the vegetable markets. G
Hundekaris have themselves described the nature of their work in
writ petition No. 1475/1987 in the affidavit filed by the Balvantrao
Salunke dated 29th July 1987. The Hundekaris also claim that they
are the direct employers of manual workers who are engaged in
the fruit, vegetable and flower markets for the work of loading and H
926 SUPREME COURT REPORTS (1995] 3 S.C.R.

A unloading produce. They have pointed out in .support of their
contention, that the transport receipt in respect of the goods
brought into the city is directly addressed by the farmers to the f
Hundekaris. The receipt also mentions the name of the agent
and/or trader to whom the goods are to be delivered. The transport
receipt which is addressed only to the Hundekari clearly indicates
B that he alone is responsible for the receipt of the goods and their
effective despatch in the market. For this work the hundekari
engages the services of the manual workers. On arrival of the
vehicles carrying the produce, the hundekari pays necessary taxes
to the Municipal Corporation of Greater Bombay for weighing the '
c goods and also pays all other charges. In their affidavit. the Hun-
dekaris have annexed a copy of one such receipt for payment of
weighment charges issued by the Municipal Corporation of a
Hundekari. It is also pointed out that the transporter brings a letter
addressed to the Hundekari from the farmer containing the
transport receipt as well as other documents in respect of the goods
D which are addressed to the Hundekari and to the agents. The
Hundekari has to check whether the goods mentioned in the
transport receipt and the goods in the vehicle tally and are accord- l'

ing to the description. He has to sort out these goods and despatch
them to the respective traders or commission agents. When there
E is more influx of goods, Hundekaris have to engage additional
workers for which they alone are responsible. The crates which are
reusable are required to be re-desp&tched to the farmers. This
work is also done by the Hundekaris. Looking to all these docu-
ments as well as the description of the work done by these Hun-
dekaris, their contention that they directly engage manual workers
F
for the work of loading and unloading appears to be correct. The
state government is also supporting this stand as set out earlier.
Hundekaris, therefore, cannot be considered as contractors within
the definition of that term under section 2 sub-section (2) of the
said Act. The workers are not engaged by Hundekaris on behalf
G of by the Hundekaris for their own work. Therefore, Hundekaris
fall within the definition of the term 'employer' under section 2(3).'

As stated above by the High Court 'Hundekaris' are persons who ~ ...
engage matbadi workers (unprotected workers) in the scheduled employ-
H ment. This statement of the High Court is not controverted by the learned
M.R.M.TPT. AND C.K.UNIONv. STATE [VENKATACHALA, J.] 927

counsel for the appellant and indeed it gives no room for controversy. But, A
when a 'Hundekari' engages mathadi workers (unprotected workers) for
~
executing the work of an establishment over which he has no ultimate
control or the affairs of which are not entrusted to him he would be a
contractor within the meaning of section 2(2) of the Act and not an
employer who either engages unprotected workers by or through a con-
tractor in the scheduled employment or who has ultimate control over the B.
affairs of the establishment or to whom the affairs of the establishment are
entrusted within the meaning of section 2(3) of the Act .

. .. Therefore, a 'Hundekari', whether he is called ~n agent, a manager
or by •any. name prevailing in the scheduled employment, he can be
regarded as a ·~ntractor' within the meaning of section 2(2) of the Act
c
when he engages such mathadi workers for the principal employer's estab-
lishment and not as employer within the meaning of section 2(3) of the Act
unless he engages the mathadi workers for the schednled establishment
either being a person who has the ultimate control of the affairs of the
establishment or a person to whom the affairs of the establishment· are D
. entrusted by their owners.
'I
From the above, it follows, that where a Hundekari has an estab-
lishment over which he· has ultimate control or has an establishment the
affairs of which are entrusted to him and he engages mathadi workers
E
' either on hire or otherwise for carrying on the work of such establishment,
such Hundekari could be regarded as an employer within the meaning of.
Section 2(3) of the Act, as is held by the High Court. On the other hand,
a Hundekari, who does not engage the rnathadi workers for the work. of an
establishment not belonging to him or on the affairs of which. he Iias no
·' ultimate control or the affairs of which are not entrusted to him, cannot be F
regarded as an employer within the meaning of Section 2(3) of the Act.
The decision taken by the Government and the view taken by the High
Court that even Hundekaris who have neither control over the estab-
lishment nor the entrusted with the affairs of the establishment are,
employers within the meaning of Section 2(3) of the Act, is manifestly G
erroneous .

.- We shall now take up for examination Clause 14 of the Scheme,
which provides for registration of employers. That clause reads thus:

. '14. Registration of employers.-£very employer including a H
928 SUPREME COURT REPORTS [1995] 3 S.C.R.

A Mukadam, commission agent, clearing agent, purchaser, importer,
exporter engaged in selling, purchasing or trading or acting as
agent in vegetable market and other establishments in the areas to
which this Scheme applies shall get registered with the Board by
applying in Form 'A' appended to this Scheme within fifteen days
from the date of coming into force of this clause. Provided, how-
B ever, that an employer of any establishment coming into existence
after the commencement of this Scheme shall apply for a registra-
tion simultaneously on the commencement of his business.'

Form 'A' appended to the Scheme and referred to in the above
C Clause refers to the particulars to be furnished in the appiication for
registration of employers . It reads thus :

"FORM'A'

(See Clause 14)
D
THE VEGETABLE MARKETS UNPROTECTED LABOUR
BOARD
..
Application for the registration of employer.

E Registration No.
(to be filled in by office)

I, hereby apply for registration as an employer, etc. The neces-
sary particulars are given below :-

F 1. Name and address of the
Establishment and Telephone No.

2. Whether a firm or a company
Name of the proprietor

G (1)

(2)

(1)

H (2)
M.R.M.TPT. AND C.K.UNJONv. STATE [VENKATACHALA, J.) 929

3. Are you a member ~f any Association of A
employer? If so, state the name of the Associa-
tion.

4. Whether your Establishment is registered under
the Bombay Shops and Establishments Act,
1948. If so, state Registration No. B

5. The place(s) of work with location in details
where the loading, unloading, stacking, carrying;
I
etc. of goods is carried on in connection with .
trade/business of your Establishments.
c
6. Are you employing workers through contrac-
tors( s)? If so, state the name and other details
of the contractor(s). l

7. Are you employing workers through Tolli? If so,
D
state the name of the Mukadam/s of the Tolli/s
or of all workers.

Date:

Place:
E
Signature of the Applicant
By order and in the name of the
Governor of Maharashtra.

N.N.PANDYA
Desk Officer"
F

If the text of Clause 14 and the particulars required to be filled up
by the employer in Form 'A' are seen together, they make it abundantly
clear that the employer required to be registered under Clause 14 with the
Board is none other than the employer falling within the definition of G
'employer' in Section 2(3) of the Act. When Clause 14 states that every
employer, including a mukadam, commission agent, clearing agent, pur-
chase, importer, exporter engaged in selling, purchasing or trading or
acting as agent in vegetable market and other establishments in the areas
to which the Scheme applies shall get registered with the Board by applying
in Form 'A' appended to the Scheme it makes abundantly clear that such H
930 SUPREME COURT REPORTS (1995] 3 S.C.R.

A employer must have an establishment of his own over the affairs of which
he has ultimate control or must have an establishment the iliairs of which
are entrusted to him. If a person who wants to register himself as an
employer under that Scheme, he has to show as a condition precedent that
he has an establishment of his own over which he has ultimate control or
has an establishment the business affairs of which are entrusted to him,
B becomes obvious for the reason that item 1 of Form 'A' requires him to
give the name and address of the establishment and telephone number and
under item 4 thereof requires him to give the information as to whether
the said establishment is registered under the Bombay Shops and Estab-
lishments Act, 1948 with registration number. Therefore, if a person wants '
C to register as an employer under Clause 14 of the Scheme, the Board
cannot register him as such unless he has an establishment on the business
of which he has ultimate control or he has an establishment the business
affairs of which are entrusted to him for being carried on. When later part
of Clause 14 states "provided, however, that an employer of any estab-
lishment coming into existence after the commencement of this Scheme
D shall apply for a registration simultaneously on the commencement of his
business", would clearly support the view we have expressed of Clause 14
that the person who is required to get himself registered as an employer
under Clause 14 must, as a condition precedent, have an establishment over
the business affairs of which he has ultimate control or must be a person
entrusted with carrying on the business affairs of such establishment, i.e.
E of establishments carrying on business in vegetables, including onions and
potatoes.

Thus, if Hundekaris have to get themselves registered as employers
under Clause 14 there is no room for doubt that they are entitled to be
F registered as employers thereunder if they own markets or establishments
doing the business in vegetables including onions and potatoes having
ultimate control over such markets or establishments or are entrusted with
the carrying on the affairs of such markets or establishments. However, if
Hundekaris do not have vegetable markets or establishments of their own
over which they have ultimate control or if the carrying on the affairs of
G vegetable markets or establishments are not entrusted to them, they cannot
be registered as employers under Clause 14 of the Scheme. The decision
of the Government and the view taken by the High Court to the extent it \ -.
is not in consonance with what we have said as to the right of the
Hundekaris to get themselves registered as employers under Clause 14 of
H the Scheme, we have to hold, is manifestly erroneous.
,_,
\

M.R.M.TPT. AND C.K.UNION v. STATE [VENKATACHAf.A, J.] 931

Hence, what. emerges from a proper reading and understanding of A
the definitions in the Act relating to 'principal employer', 'employer',
'establishment', 'scheduled employment', 'contractor' and Oause 14 of the
Scheme and Form 'A' ·aJlpended thereto can be summarised thus :

That the Board can register Hundekaris, by whatever name they may
be called, under Clause 14.of the Scheme as the employers only where it B
is established that they are the owners of the vegetable markets or esiab-
lishments where they are carrying on the business either having ultimate
control over such establishments or being entrusted with the carrying on
the affairs of such markets or establishments and not otherwise. If any of
the Hundekaris, by whatever name may be called, are registered as ('
employers under Clause 14 of the Scheme not being the owners of the
vegetable markets or establishments in the areas concerned having either·
ultimate control over them or being entrusted with the carrying on the
affairs of the same, their registration is liable to be cancelled.

What we have said as regards registration of Hundekaris as D
employers or cencellation of registration of employers under Oause 14 of
the Scheme, shall not, however, come in the way of the Board of registering
any person who owns a vegetable market or establishment, and has ultimate
control over the business of such market or of registering any person who
is carrying on the business affairs of such market or establishment being so
entrusted as an employer under Clause H of the Scheme on submission of E
an application in the Form appended to the Scheme.

In the result, we allow this appeal partly, to the extent we have
..( indicated as above and direct ·respondent-3 to decid.e on the registration
of the employers under Clause 14 of the Scheme in terms of this judgment. F
No costs.

RA. Appeal partly allowed.

,. )