U.P. State Electricity Board. Vs. Shiv Mohan Singh & Anr  Insc 598 (1
S.B. Sinha W I T H CIVIL APPEAL NOS. 8383 TO 8386, 7005-06, 9231 TO 9234 & 9679 TO
9681 & 9683 OF 2003 AND C.A. NOS. 14, 122, 1965, 2193 OF 2004 S.B. SINHA, J
Section 2(z) of the U.P. Industrial
Disputes Act, 1947 defines 'Workman' to mean "any person (including an
apprentice) employed in any industry to do any skilled or unskilled, manual,
supervisory, technical or clerical work for hire or reward, whether the terms
of employment be express or implied, and for the purposes of any proceeding
under this Act in relation to an industrial dispute, includes any such person
who has been dismissed, discharged or retrenched in connection with, or as a
consequence of, that dispute, or whose dismissal, discharge or retrenchment has
led to that dispute,." A workman includes apprentice in terms of the said
Disputes Act, 1947, is a general law. The Parliament enacted Apprentices
Act, 1961 (for short 'the said Act') which is a special law. It deals with the
regulation and control of training of apprentices and for matters connected
The special statute, therefore, shall prevail over the general statute
having regard to the maxim "generalia specialibus non derogant [See
[(2004) 6 SCC 178].
The said Act is a complete code in itself. An apprentice, as defined in
Section 2(aa) of the said Act, is a person who enters into a contract of
apprenticeship for the purpose of undergoing apprenticeship training in a
designated trade. Entering into a contract of apprenticeship, therefore, is the
basis for attracting the provisions of the said Act.
The primal question which arises for consideration is as to whether a person
who is an apprentice within the meaning of Section 2(aa) of the said Act would
become a workman and, consequently, would be entitled to the benefits of
various labour laws in the event of breaches of the terms of the said contract
as also non-registration thereof.
It is neither in doubt nor in dispute that an 'apprentice' within the
meaning of the provisions of the said Act would per se not be a workman within
the meaning of Section 2(z) of the U.P. Industrial
Disputes Act. It is further not in dispute that in terms of Section 18 of
the Act the apprentices being trainees and not workers would not be entitled to
the benefits of provisions of any labour laws.
Section 4(1) of the said Act provides that a contract of apprenticeship will
have to be executed by the employers and the apprentice before the
apprenticeship training begins. Such training commences as soon as the said
contract is executed. Sub-sections (4) and (5) of Section 4 of the said Act,
however, provide that every contract of apprenticeship shall be sent to the
Apprenticeship Advisor for registration within the period prescribed therefor
whereupon, he would register the same if he is satisfied that they meet the
qualifications provided in Section 3 thereof.
It is relevant to notice at this juncture that prior to amendment of the
said Act in the year 1973 by Act No. 27 of 1973, Section 4 postulated that
apprenticeship training would not commence till a contract of apprenticeship
was entered into by and between the apprentice and the employer and the same
was registered with the Apprenticeship Advisor.
The provision of Section 4 of the said Act as it existed prior to 1973
assumes importance for the purpose of interpretation thereof.
It is furthermore not in dispute that the said amendment was brought about
with a view to avoid delay in commencement of training of the apprentices.
Mr. R. Venkataramani, learned senior counsel appearing on behalf of the
Respondents would suggest that despite such amendment the importance of the
registration of the contract of apprenticeship cannot be held to be diluted
having regard to the expressions used therein which are imperative in
character. The learned counsel is not entirely correct.
Ordinarily, although the word "shall" is considered to be
imperative in nature but it has to be interpreted as directory if the context
or the intention otherwise demands. (See M/s. Sainik Motors, Jodhpur and It is
important to note that in Crawford on Statutory Construction at page 539, it is
"271. Miscellaneous Implied Exceptions from the Requirements of
Mandatory Statutes, In General.-Even where a statute is clearly mandatory or
prohibitory, yet, in many instances, the courts will regard certain conduct
beyond the prohibition of the statute through the use of various devices or
principles. Most, if not all of these devices find their jurisdiction in
considerations of justice.
It is a well known fact that often to enforce the law to its letter produces
manifest injustice, for frequently equitable and humane considerations, and
other considerations of a closely related nature, would seem to be of a
sufficient caliber to excuse or justify a technical violation of the law."
It is no doubt true that the Apprenticeship Advisor has certain statutory
duties and functions as contained in Sections 4(5), 5, 7, 8, 9, 10, 15 and 29.
It is furthermore true that Sections 19 and 20 provide for certain obligations
upon the employer to obtain approval of the Apprenticeship Advisor and forward
the records to the concerned authorities.
Similarly, the rules framed under Section 37 of the Act confer certain
benefits upon the apprentices. If an employer fails to perform his statutory
duties or deprives an apprentice from the benefits to which he is entitled to,
the Apprenticeship Advisor can file an appropriate complaint before a competent
court of law. In terms of Section 31 of the Act the only penalty which can be
imposed upon the employer is fine which shall not be less than one thousand
rupees but may extend to three thousand rupees.
Violation of the provisions of the Act, therefore, does not result in
A question which also arises for consideration is as to whether Section 18
of the said Act must be strictly construed.
If a contract of apprenticeship is entered into; the violation of the terms
and conditions thereof, in our opinion, although may lead the penal
consequences but the same would not render the contract of apprenticeship void
In the event, the Apprenticeship Advisor obtains informations about such
violations, he is entitled to take suitable steps in that behalf under the Act
or the rules but he has not been conferred with any power to declare such
contract of apprenticeship to be ipso facto void ab initio. Section 20 also
provides resolution of disputes between an apprentice and the employer arising
out of the contract of apprenticeship which shall be referred to the
Apprenticeship Advisor for decision. While resolving a conflict by and between
an employer and an apprentice under Section 20 of the said Act, indisputably he
can issue directions which the employer will have to comply with and on his
failure to do so, he would run the risk of being prosecuted in terms of Section
30 of the Act, but even in such a situation he cannot bring an end to the
contract. The contract of apprenticeship like any other contract can be brought
to an end by the parties thereto.
Once a contract of apprenticeship commences, the same cannot be brought to
an end except in accordance with law. By reason of non- registration of the
contract of apprenticeship, the same does not become a nullity. If it is to be
held that by reason of non-registration of such contract of apprenticeship the
contract itself comes to an end, it would be detrimental to the interest of the
apprentices, which would frustrate the object of the Act.
The definition of 'Apprentice' nowhere states that an apprentice with a view
to obtain the benefits of the said Act must also be registered.
Section 18 of the said Act says that an apprentice shall not be a worker. It
does not say that an unregistered apprentice shall be a worker.
Only because the expression "shall" has been employed in sub-
section (4) of Section 4, the same may not be held to be imperative in
character having regard to the fact that not only, as noticed hereinbefore, a
contract of apprenticeship commences but also in view of the fact that an
application for registration of apprenticeship contract is required to be made
within a period of three months in terms of Rule 4B of the Apprenticeship
Rules, 1962. The Act nowhere provides for the consequences of non-registration.
It is not in dispute that the list of apprentices used to be sent by the
Apprenticeship Adviser himself and, thus, presumably the preliminary scrutiny
in that regard had been made by the said authority. If in a given case, as
noticed hereinbefore, the employer fails to get the contract of apprenticeship
registered and/or fails to carry on his obligations in terms of Section 11 of
the Act, he faces penal consequences in terms of Section 31 of the Act. The
employer, furthermore, is liable to pay compensation for termination of
apprenticeship as would appear from Rule 6 of the Apprenticeship Rules, 1962,
which reads thus :
"Compensation for termination of apprenticeship.- Whereas the contract
of apprenticeship is terminated through failure on the part of any employer in
carrying out the terms and conditions thereof, such employer shall be liable to
pay the apprentice compensation of an amount equivalent to is three months'
last drawn stipend; and when the said termination is due to failure on the part
of an apprentice in the above manner, then a training cost of an amount
equivalent to his three months last drawn stipend shall be made recoverable
from such apprentice or from his guardian in case he is minor." No
provision of the Act or the rules framed thereunder was brought to our notice
to show that non-registration of the contract of apprenticeship or violation
and/or neglect on the part of the employer to comply with the other provisions
of the Act it would result in invalidation of the contract.
An apprentice remains an apprentice having regard to the definition
contained in Section 2(aa) of the Act and continues to work in the said
capacity. His status does not change to that of a workman only because the
contract has not been registered or the employer has not carried out his
obligations thereunder. If such a construction is placed, an apprentice may be
held to have ceased to be an apprentice if he himself defaults in performing
his obligations under the contract.
Ors. [2004 (7) SCALE 495] this Bench has held that even if a benami
transaction is prohibited the same per se would not render the transaction void
ab initio and illegal.
It is now well-settled principle of law that if the language used in a
statute is capable of bearing more than one construction, the true meaning
thereof should be selected having regard to the consequences resulting from
adopting the alternative constructions. A construction resulting in hardship,
non-fulfillment of the purpose for which statute has been brought in force should
be rejected and should be given that construction which avoids such results.
Sub-section (4) of Section 4 of the said Act can also be held to be
directory having regard to the rule laid down in Heydon's case. [(1584) 3
(2004) 3 SCC 1 and Ameer Trading Corporation Ltd. vs. Shapoorji Data Processing
Ltd. (2004) 1 SCC 702].
The mischief rule enables the court to take into consideration the following
four factors for construing an Act:
(i) What was the law before the making of the Act, (ii) What was the mischief
or defect for which the law did not provide, (iii) What is the remedy that the
Act has provided, and (iv) What is the reason of the remedy.
The rule then directs that the courts must adopt that construction which
"shall suppress the mischief and advance the remedy".
Prior to 1973, the provision for registration was mandatory in character.
Only having regard to the delay which has occasioned for registration of
contract of apprenticeship, the said amendment had been brought about; pursuant
whereto or in furtherance whereof the contract of apprenticeship commences. If
the purpose of amendment was to make the contract workable even without
registration, we fail to see any reason as to why the provision should be
construed as imperative in character so as to render a contract of
apprenticeship a nullity which is possible to be avoided and the object thereof
can be achieved by taking recourse to the penal provisions.
It may be true that rules framed under Section 37 of the Act are required to
be laid before both Houses of Parliament after formulation; but even such a
provision is directory in nature.
It is not a case where any of the apprentices repudiated the contract.
No argument has also been advanced to the effect that the contract of
apprenticeship was merely a camouflage or a ruse so as to establish that in
effect and substance, while appointing a person as an apprentice, the employer
has been taking work from him malafide or with a view to deprive him from the
benefits of the labour legislations, nor any material in respect thereof had
been brought on records.
Whether a relationship of an employer and workman or an employer and an
apprenticeship had been brought about, is essentially a question of fact. The
Court while determining such a dispute must consider the factual matrix
involved therein in the light of the provisions of the said Act. Once it is
held that a contract of apprenticeship entered into by and between the employer
and the workman is a genuine one and not a camouflage or a ruse, a presumption
would arise that the concerned person is not a workman.
It is one thing to say that a contract is illegal being opposed to public
policy so as to render the same void in terms of Section 23 of the Indian
Contract Act but it is another thing to say that by reason of breaches of the
terms and conditions thereof by one of the parties it becomes voidable at the
instance of the other party to the contract. If a contract is valid in law the
breaches thereof would not render it invalid but the same may only enable a
party thereto, who had suffered by reason of such breach, to avoid the
contract. Unless the terms and conditions of a contract are avoided by a party
thereto the contract remains valid and all consequences flowing therefrom would
enure to the benefit of the parties thereto.
Mr. Venkataramani has relied upon a decision of the Court of wherein it is
"If the party against whom frustration is asserted can by way of answer
rely on his own misconduct, injustice results." Ex facie the said decision
has no application in the present case.
The plea of frustration was not pleaded or established. It is one thing to
specify as what would be the legal consequences of a breach of a contract but
it is another thing to say that despite subsistence of a valid contract, the
statutory benefits thereof shall not enure to the parties thereto. In absence
of any specific provision in the statute, we are unable to accede to the
submissions of the learned counsel to the effect that in the event of commission
of a breach by the employer the contract of apprenticeship shall become a
contract of employment. Such a novation of contract is not contemplated in law.
With a view to become a workman, not only the apprentice has to show that he
comes within the purview of the definition of the term 'workman' as contained
in Section 2(z) of the U.P. Industrial
Disputes Act, 1947 but he
must further plead and establish that his job is such which Divn. Manager, LIC
& Ors. JT 2004 (7) SC 232 = 2004 (7) SCALE 442].
481, a contract of tenancy was held to be binding upon the parties even
though the grantor lacked the necessary power. A housing association which
itself was a licensee granted a licence which in view of the decision though
the housing association, being themselves mere licensees had no power to grant
a legal tenancy valid against all the world. It is, therefore, necessary to
ascertain as to how the parties to the contract thought thereabout. Ordinarily,
it is impermissible in law for a party to the contract of apprenticeship to
allow it to be worked out and then contend that it was a contract of
In The Employees' State Insurance Corporation and Another vs. The Tata
Engineering & Locomotive Co. Ltd. and Another (1975) 2 SCC 835, it was
"The concept of apprenticeship is, therefore, fairly known and has now
been clearly recognized in the Apprentices Act.
Apart from that, as we have noticed earlier, the terms and conditions under
which these apprentices are engaged do not give any scope for holding that they
are employed in the work of the company or in connection with its work for
wages within the meaning of Section 2(9) of the Act..." Decisions are
galore to show that despite a contract of apprenticeship coming to an end, the
concerned workman must fulfill the U.P. State Electricity Board, Shakti Bhawan,
Lucknow and Others, 2000 Corporation and another, 2000 (84) FLR 847 and
Mitrangshu Roy A Division Bench of the Gujarat High Court in Ballkhan Doskhan
Joya vs. Gujarat Electricity Board [2002 (92) FLR 914], whereupon Mr.
Venkataramani, relied, observed :
"The Central Legislature was, therefore, fully alive to the situation
that an apprentice, undergoing an apprenticeship training under an
apprenticeship contract duly registered, would be only a 'trainee' and not a
'workman', to which other laws in respect of labour shall not apply. Therefore,
in including, in the definition of 'workman', 'apprentice' as well, the
legislative intention appears to be obvious that such apprentices, who are not
undergoing apprenticeship training under a duly registered 'apprenticeship
contract, envisaged by the Apprentices Act,
and to whom provisions of Section 18 of the said Act are not applicable, would,
nonetheless, be included in the definition of 'workman' under the I.D.
Act and would get all the protection of labour laws. The learned single
Judge may be right in his reasoning that even after non-registration of the
contract of apprenticeship, the appellant would only be a 'trainee', or an
'apprentice', as intended by the parties and he would not be an 'employee' or a
'workman', within the meaning of the Apprentices Act.
Even if, as stated by the learned single Judge, the appellant, as a result of
non- registration of contract of apprenticeship, is deemed to be a trainee or
an 'apprentice', he would, nonetheless, be covered within the definition of
'workman' under Section 2(s) of the I.D. Act." The ratio enunciated in the
said decision appears to be self- contradictory. An apprentice cannot both be
an apprentice and a workman under the 1947 Act.
Similarly, the observations made by the Patna High Court in Ram Dular Paswan
and Others vs. P.O. Labour Court, Bokaro Steel City and Others [1998 (80) FLR
399] to the effect that "The Apprentices Act
does not deal with the investigation and settlement of industrial disputes
between the employer and the workmen. Therefore, so far as the settlement of
the industrial disputes is concerned, the I.D. Act will prevail over the Apprentices Act. If the
employer takes the kind of work mentioned in Section 2(s) of the I.D. Act from
the apprentice, the dispute between them has to be settled under and in
accordance with the said Act. But if the apprentice does not perform such work,
the I.D. Act will not apply to him. The line of demarcation between the
apprentice and the workman is very clear. If and when a question as to whether
an apprentice is really an apprentice or is a workman wearing the mask of an
apprentice, is raised the appropriate authority/Labour Court will have to apply
mind to the nature of his work. The veil has to be lifted in order to find out
the reality. But such a question cannot be decided merely on the basis of
apprenticeship contract or on the basis of the label, which a person
wears." does not appear to be correct, particularly for the reasons that
the High Court has failed to consider that Section 20 of the 1961 Act provides
for settlement of disputes. Furthermore, as observed hereinbefore, such a
contention has to be specifically pleaded and established.
Moreover in terms of Section 22 of the Act, the employer has no statutory
liability to give employment to an apprentice.
We are, therefore, are of the considered view that non-registration of the
contract of apprenticeship would not render the same nugatory.
Subject to the foregoing supplemental reasons, I respectfully concur with
the judgment of Mathur, J.