TN Medical Services Corporation Not Allowed To Wash Its Hands Off Responsibilities: SC Upholds Regularization Of Workmen

The Bench explained that simply because construction was one of the activities undertaken by the Tamil Nadu Medical Services Corporation Limited (Corporation), it would not take all the workers out of the purview of the Act, especially, when some of the workers, like the members of the Tamil Nadu Medical Services Corporation Employees Welfare Union (Union), were not even undertaking construction work.

Justice Sanjay Karol and Justice Prasanna Bhalachandra Varale observed, “This, however, in our view would not allow the Corporation to wash its hands off the responsibilities or obligations under the Act, since the construction to be undertaken by the Corporation, is only one of the many activities to be undertaken by it. To take all the workers out of the purview of the Act, especially, when the said workers, like the members of the respondent union, were not the ones undertaking construction is unwarranted.”

Sr. Advocate S. Nandakumar represented the appellant, while AOR D. Kumanan appeared for the respondents.

The employees of the Government Corporation sought regularization under the provisions of the Act. All 53 workmen who sought the same, were granted permanent status by the Inspector of Labour and the Corporation was accordingly directed to provide employment to the workmen. The same was confirmed by the Madras High Court.

The core issue for determination before the bench was the application of the Act to the Corporation qua the employees and the Union. The Court had to consider whether the Corporation could be termed as an industrial establishment and whether the members of the Union would qualify as workmen and therefore would be eligible for permanent status under Section 3 of the Act.

Pointing to the fact that the commercial element was not absent, the Court explained that “for any establishment to be commercial, it has to be established that the activities undertaken by it are for making some monetary gain. Commercial in the most rudimentary sense means buying or selling of goods in exchange of money.”

“Since the High Court concluded that the Act would apply, there was no reason for it to disturb the finding of the Inspector of Labour and, therefore, it ought to have simply ordered that the order of Inspector of Labour which concluded that the members of the respondent-Union be given permanent employment, be complied with,” the Bench held.

Consequently, the Court held that the High Court erred in entertaining the petition and interfering with the recovery notice while exercising the extraordinary writ jurisdiction conferred under Article 226 of the Constitution.

Accordingly, the Supreme Court dismissed the appeal.

Cause Title: Tamil Nadu Medical Services Corporation Limited v. Tamil Nadu Medical Services Corporation Employees Welfare Union & Anr. (Neutral Citation: 2024 INSC 446)

Appearance:

Appellant: Sr. Advocate S. Nandakumar; AOR Naresh Kumar and K. K. Mani; Advocates Deepika Nandakumar, Preeti Nair, T.archana and Rajeev Gupta

Respondents: AOR D. Kumanan and G. Indira; Advocates Deepa. S, Sheikh F. Kalia, P Gandepan, Ashwini Kumar and D Poornima

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