Holding

A section salesman performing sales‑promotion and creative duties is not a "workman" under the Industrial Disputes Act, 1947, and the Act is therefore inapplicable.

Summary

T.P. Srivastava, employed as a Section Salesman by National Tobacco Co., was terminated in July 1973 for alleged unauthorized absence. The Government of Rajasthan referred the matter to the Labour Court to determine whether the termination was lawful and whether Srivastava qualified as a "workman" under the Industrial Disputes Act, 1947. The Labour Court held that he was not a workman, rendering the reference incompetent, but nevertheless found the termination illegal. On appeal, the Supreme Court affirmed that the duties of a section salesman—canvassing, sales promotion, market study, and creative advertising—do not fall within the manual, skilled, unskilled or clerical categories contemplated by the Act, and thus the Act does not apply. Recognising the 16‑year delay, the Court directed the company to pay compensation equivalent to three years’ salary, but dismissed the appeal.

Issues considered

Whether a section salesman engaged in sales promotion and creative advertising is a "workman" within the meaning of Section 2(b) of the Industrial Disputes Act, 1947.
Whether the termination of the appellant's services was illegal under the Industrial Disputes Act.
Whether the Sales Promotion Employees (Conditions of Service) Act, 1976 applies to the appellant.

Legislation cited

Subjects

Industrial Disputes Actworkman definitionsales promotion employeetermination of servicecompensationlabour court jurisdictioncreative work dutiessection salesman

Judgment

A T .P. SRIVASTAVA
v.
NATIONAL TOBACCO CO. OF INDIA LTD..

OCTOBER 11, 1991

B [KULDIP SINGH A.1'lD V. RAMASWAMI, JJ.]

Industrial Disputes Act, 1947-Section 2 (b)-"Workman"- Definition
of- Section salesman having supervisory duties and such duties which re-
quire creative mind, not workman-Employee covered under the Sales
C Promotion Employees (Condition of Se111ice) Act, 1976 not workman.

Labour Law-Tennination of se111ices of-a Section Salesman-Find-
ings of Labour Cowt approved by Supreme Court-16 years old labour dis-
pute--Direction to pay amount equivalent to three years salary.
The appellant was in the service of the respondent-company as a
D Section Salesman. He was terminated from service on 12th July, 1973 on
. the ground that he was on an unauthorised absence since 13th January,
1973.

At the instance of the appellant the Government referred to the
E Labour Court for adjudication the question whether the termination of the
services of the appellant by the respondent-company was legal and
justified. and if not to what relief he \vas entitled to.

The Labour Court held that the appellant was not a "workman" and
that, therefore, the reference was incompetent but it answered the question
F · whether the termination itself was illegal in favour of the appellant.·
The appeal was filed in this Court against the order of the Labour
Court.

Dismissing the appeal, this Court,
.
G HELD: 1. Jn order. to come within the definition of "workman" under
the Industfial Disputes',A~t as it stood in the y~ar 1973 when the
appellant's service was terminated, the employee has to be under the
employment to do the work of one of the types of work i.e. manual, skilled
and/or clerical in nature. [475-E]
H 472.
T. P. SRIVASTAVAv. TOBACCO CO. 473

2. The appellant was employed to do canvassing and promoting sales A
for the company. The duties Involve the suggesting of ways and means to
lm~rove the sales; a study of the type or status or the public to whom the
product has to reach and a study of the market condition. He was also
required to suggest about the publicity in markets and melas,
advertisement including the need for posters, holders and cinema slides. B
nese duties do require the imaginative and creative-mind which could not
be termed as either manual, skilled, unskilled or de~ in nature. The
supervising work or the other local salesman was onl)' 11 tcidental to his
main work or canvassing and promotion in the areas' or his operation.
Such a person cannot be termed as a workman. [;175 F..C)
c
3. The Sales Promotion Employees (Conditions of Service)Act, 1976,
defines "sales promotion employees" as meaning a person employed or
engaged in any establishment for hire or reward to do any work relating to
promotion of sales or business or both. [476 A-BJ

4. The object of the enactment and the employees covered by the D
enactment also go to show that persons who are employed for sales
• -( promotion normally would not come within the definition or workmen
.
under the Industrial Disputes Act. [476 C-DJ

S. In view of the fact that a long period of over 16 years bad passed It· E
would be unjust to leave the appellant without any remedy at this stage. To
meet the ends of justice, the Company is to pay an amount equivalent to
tJtree years salary at the rate he was drawing when the appellant's services
were terminated, in addition to whatever amount they were paying during
the pendency orthe appeal.,1476 E,FJ

Bunnali Shell Oil Storage and Distribution Company v. Bunnah Shell
Management and Staff, AIR 1971 SC 922; D.S. Nagraj v. Labour Officer,
Kamal & Ors., 1973 (42) F.J.R. 400; JJ. Dechane Distributor v. State of
Kera/a and Ors., 1974-11 LI.J 9, referred to.

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1681- G
A(L) of 1979.

... From the award dated 2.8.1978 of the Additional Labour Court,
Rajasthan in Reference Case No. ALC - 120 of 1974.

V.M. Tarkunde, P.H. Parekh and Sunil Dogra for the Appellant.
H
474 S,UPREME COURT REPORTS [1991] SUPP. 1 S. C. R.

A J.D. Jain for the Respondent.

The Judgment of the Court was delivered by

V. RAMASWAMI, J. The appellant who had been in the service of
· the respondent-company as a Section Salesman was terminated from ser-
B vice. on 12th July, 1973 on the ground that he was on an unauthorised
· absence since 13th January, 1973 and shall be deem,ed to have left the
company's service of his own account. At the instance of the appellant the
Government of Rajasthan referred to the Labour Court ior adjudication
the question whether the termination of the services of the appellant by the
respondent- company was legal and justified and if not to what relief he
C was entitled to. The Labour Court by its award dated 2.8.1978 held that the
appellant was not a "workman" and that, therefore, the reference was in-
competent. We may, however, state that the Labour Court has given find-
ings in favour of the appellant on the question whether the termination
itseif was illegal.

D The facts as found by the Labour Court for coming to the conclusion
that the appellant was not a "workman" a.re these. The head office of the
company is at Calcutta in West Bengal. The appellant was appointed as a
section salesman and his services were controlled by the head office
through its territory office situated in Delhi. Section salesman are ap-
pointed for certain number of districts and in the area of each section
E · salesman, a number of local salesmen and local travelling salesmen are
appointed. The appellant was appointed as a section salesman for the
districts of Bikaner, Ganganagar, Merta and Barmer in Rajasthan with his
head quarters at Bikaner. There were seven other local salesmen and local
travelling salesmen in his area. The various correspondence and other
' evidence produced before the Labour Court showed that the appellant was
F employed for canvassing and pushing and promoting, the sales of the
company's product in his area. The Tribunal also found and in fact it has
··refem~d to as an admitted case of both the parties that the respondent
company sells its product i.e. cigarettes manufactured by it directly through
their wholesalers who in their turn sell· the product to the various dealers
appointed by the company in the area. The section salesman neither sells
G nor eollects any money from the,wholesaler or retail dealers. The company
controls this through the territory office at Delhi. Neither the section sales-
man nor the local salesmen or local travelling salesmen are employed in
the shop of the wholesaler or any retail dealer to sell the products of the
company and to collect the amount of sale. The section salesmen and the
local salesmen and local travelling salesmen were employed by the com-
H pany in order to canvass and promote the sales of the company. From
T. P. SRIVASfAVAv. TOBACCO CO. [V. RAMASWAMl,J.) 475

perusal of the records produced before the Labour Court the Tribunal A
further observed "it was apparent that the appellant is required to send
reports about the publicity and advertisement and of placing posters,
holders, cinema slides and suggest means to canvass the sale in this area.
Some of the document relate to matters of publicity in melas, some relate
to the existing position of the stock of the goods of the company in the area
and the actio.n taken .to ameliorate stocks". It was not the duty of the B
appellant to procure orders for the company. None of the salesmen were
employed to sell the product of the company in any particular (lrea or
collecting the sale proceeds and depositing the same with the company.
However, the Tribunal noted that the appellant was required to supervise
the work of the local salesmen andJocal travelling salesmen appointed in
the area of his operation as well but it was only incidental to his main. C
function of canvassing and promoting the sale of the product of the com-
pany in the four districts allotted to him. On these facts found, the Tribunal
came to the conclusion that the appellant cannot be held to be a workman
employed for manual, skilled, unskilled and/or clerical nature and that the
provisions of the Industrial Disputes Act was not applicable and the refer-
ence, therefore, was incompetent. It is against this order the appeal was D
filed.

In order to come within the definition of workman under the In-
dustrial Disputes Act as it stood in the year 1973 when the appellant's
service was terminated, the employee has to be· under the employment to
do the work of one of the types of work referred to in the Section i.e. B
manual, skilled and/or clerical in nature. The finding of the Tribunal on
the nature of the work is a finding on a question of fact and il is also
borne out by the document produced before the Labour Court. It is seen
from the facts found that the appellant was employed to do canvassing
and promoting sales for the company. The duties involve the suggesting
of ways and me~ns to improve the sales, a study of the type or status of F
the public to whom the product has to reach and a study of the market
condition. He was also required to suggest about the publicity in markets
and melas, advertisements including the need for posters, holders and
cinema slides. These duties do require the imaginative and creative mind
which could not be termed as either manual, skilled, unskilled or clerical
in nature. The supervising work of the other local salesmen was part of his G
work considered by the Tribunal as only incidental to his main work of
canvassing and promotion in the area of his operation. Such a person cannot
be termed as a workman is also the ratio of the decision of this Court in
Bunnah Shell Oil Storage and Distribution Company v. Bumiah Shell

- Management and Staff; AIR 1971 SC 922, D.S.Nagraj v. Labour Officer,
Kamal and others, 1973 F.J.R. (42) P. 440,JJ. Dechane Distributor v. State H
•
476 SUPREME COURT REPORTS [1991) SUPP. 1 S. C.R.

A of Kera/a and others (1974-11 LU.9). We may also refer to the subsequent
passing of the Sales Promotion Employees (Conditions of Service) Act,
1976. 1'llli; Act defmes "sales promotion employees" as meaning a person
employed or engaged in any establishmept for hire or reward to do any
work relating to promotion of ~es or business or both. This Act is to
apply in the first instance to every establishment engaged in pharmaceuti-
B cals industry. It enables the Central Government by notification to apply
the provisions to any 'other establishment engaged in any notified industry.
If an industry is notified under this Act then the provisions of the Industrial
Disputes Act, 1947 would also be attracted to these types of workmen.
This is a subsequent enactment and it is not applicable to the termination
in the instant case which was long· prior to the enactment of this Act.
C Further no notification under this Act bringing the provisions to the
employees like that of the company has been made under the provisions
of this Act. The object of this enactment and the employees covered by
the enactment also go to show that persons employed for sales p.:_omotion
normally would not oome within the defmition of workmen under the fo-
dustrial Disputes Act.
.
D The.Labour Court considered the merits in detail and ultimately held
that the termination of the appellant from service was illegal but dismissed
the application only on the ground that the Industrial Disputes Act was not
applicable. We would not have interfered with tfiat finding had we differed
from the Labour Court on the question whether the appellant is a
E workman. In the light of our holding that the Industrial Disputes Act is not
applicable to him and in view of the fact that a long period of over 16 years
had passed it would be unjust to leave the appellant without any remedy at
this stage. In the circumstances, we consider that a direction to the
Management to pay some compensation is necessary to meet the ends of
justice. We accordingly direct the Company to pay an amount equivalent to
F three years salary at the rate he was drawing when the appellant's services
were terminated, in addition to whatever amount they were paying during
the pendency of the appeal under orders of this Court. But this direction
will not be tr~ated as precedent.

For the foregoing reasons we are of the view that no interference is
G called for with the c!ecisions of the Labour Court and this appeal accord-
ingly fails and it is dismissed subject to the directions given above. How-
1 ever, there will be no order .as to costs. .

V.P.R ·' / Appeal dismissed.
/