UNIVERSITY INSTITUTE OF LEGAL STUDIES

LABOUR AND INDUSTRIAL LAW

PROJECT REPORT

ON

CONCEPT OF WORKMAN

UNDER THE INDUSTRIAL DISPUTE ACT, 1947

SUBMITTED TO: SUBMITTED BY:

Dr. Virender Negi Hargun Sandhu

Roll No. 195

Section D, Semester 9TH

BCOM LLB (HONS)

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 TABLE OF CONTENTS

TOPIC PAGE NO.

ACKNOWLEDGEMENT 3

STATUTORY PROVISIONS 4

INTRODUCTION 6

TRANSFER OF SHARES

MAIN PROVISIONS 7

PROCEDURE 9

RESTRICTIONS 13

TRANSMISSION OF SHARES

MAIN PROVISIONS 19

PROCEDURE 21

DIFFERENCES 22

CONCLUSION 23

BIBLIOGRAPGHY 24

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 ACKNOWLEDGMENT

At the outset, I would like to express my heartfelt gratitude and thank my teacher, Dr. Virender
Negi for putting his trust in me and giving me a project topic such as this and for having the faith in
me to deliver. Sir, thank you for giving me an opportunity which helped me to develop my
knowledge in this interesting subject as well as to grasp a better approach in dealing with this
important branch of Law.

Hargun Sandhu

Roll no. 195

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 DEFINITION

UNDER THE INDUSTRIAL DISPUTE ACT, 1947

Section 2(s): “Workman” means,

Any person (including an apprentice) employed in any industry to do any manual,

unskilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms
of employment be expressed or implied, and for the purpose 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, but does not include any such person-

(i) Who is subject to the Air Force Act, 1950 (45 of 1950), or the Army Act, 1950 (46 of 1950), or
the Navy Act, 1957 (62 of 1957); or

(ii) Who is employed in the police service or as an officer or other employee of a prison; or

(iii) Who is employed mainly in a managerial or administrative capacity; or

(iv) who, being employed in a supervisory capacity, draws wages exceeding one thousand sic
hundred rupees per mensem or exercises, either by nature of duties attached to the office or by
reason of the powers vested in him, functions mainly of a managerial nature.1

Industrial Disputes Act 1947 came into effect immediately after independence and the
object of the Act was to provide for machinery for investigation and settlement of
Industrial Disputes. Section 2(s) of the Act provides for definition of Workman.
The employment pattern has undergone a change more particularly in the recent past.
The courts have examined the definition of Workman from time to time based on various
judgements.

A bare reading of the definition provided in Section 2(s) shows that workman means any
person employed to do any manual, unskilled, skilled, technical, operational, clerical or
supervisory work for hire or reward and includes even dismissed, discharged or retrenched
workmen in connection with Industrial Disputes but the definition also provides for
exceptions.

The definition consists of three parts. The first part provides the statutory meaning. This part
determines “workman” by reference to a person (including an apprentice) who is employed in any
industry to do any “manual, unskilled, skilled, technical, operational, clerical or supervisory work
for hire or reward”. This part may be considered as the “signification or denotation part”. The

1
https://www.advocatekhoj.com/library/bareacts/industrial/2.php?Title=Industrial%20Disputes%20Act,%201947&STi
tle=Definitions
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second part which is said to be an “extended connotation” of the word “workman” is designed to
include something more than what it primarily denotes. That is, persons who have been dismissed,
discharged or retrenched in connection with or as a consequence of an industrial dispute and also
persons whose dismissal, discharge or retrenchment has led to such a industrial dispute are also
included in this part of the definition. On the contrary, in the third part of Section 2(s), certain
categories of persons specified in clauses (i) to (iv) are expressly excluded. Hence, even if a person
satisfies the requirements of the first two parts, he can not be declared as a ‘workman’ under the
Act.2

Essential Ingredients of section 2(s) are:

1. Industry. The person must be employed in an industry within the meaning

of Section 2(j) of Industrial dispute Act, 1947.

before the 1982 amendment defined industry as under:

"Industry" means any business, trade, undertaking, manufacture or calling of

employers and includes any calling, service, employment, handicraft, or industrial
occupation or avocation of workmen.

The definition of "industry" was amended in 1982 and is reproduced below. It

shall stand substituted w.e.f. the date to be notified.

(j) "Industry" means any systematic activity carried on by co-operation between an

employer and his workmen (whether such workmen are employed by such
employer directly or by or through any agency including a contractor) for the
production, supply or distribution of goods or services with a view to satisfy
human wants or wishes (not being wants or wishes which are merely spiritual or
religious in nature), whether or not—

(1) Any capital has been invested for the purpose of carrying on such activity;

Or

(2) Such activity is carried on with a motive to make any gain or profit and
includes

(a) Any activity of the Dock Labour Board established under section 5-A of the
Dock Workers (Regulation of Employment) Act, 1948;

(b) Any activity relating to the promotion of sales or business or both carried on by
an establishment. But does not include

2
Everestee v. District Labour Officer, 1999 (83) FLR 151, 155 (Ker.) (D.B.)
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(1) any agricultural operation except where such agricultural operations' carried on
in an integrated manner with any other activity (being any such activity as is
referred to in the foregoing provisions of this clause and such other activity is the
predominant one).
Explanation. For the purpose of this sub-clause "agricultural operation " does not
include any activity carried on in a plant at ion as defined in clause (f) of Sect ion
2 the Plantation Labour Act, 1951, or

(2) Hospital or dispensaries, or


(3) Educational, scientific, research or training institutions; or

(4) Institutions owned or managed by organization wholly or substantially engaged

in any charitable, social or philanthropic service; or

(5) Khadi or village industries; or

(6) any activity of the Government relatble to the sovereign functions of the
Government including all the activities carried on by the departments of the
Central Government dealing with defence, research, atomic energy and space; or

(7) Any domestic service; or


(8) any activity, being a profession practiced by an individual or body of

individuals, if the number of persons employed by the individual or body of
individuals in relation to such profession is less than ten; or

(a) Any activity, being an activity carried on by a cooperative society or a club or

any other like body of individuals, if the number of persons employed by the co-
operative society, club or other like body of individual in relating to such activity
is less than ten.

2. Employer-employee relationship. The essential condition of a person being a

workman within the term of the definition is that he must be employed in an
industry, i.e., there must be employment of his by the employer and there must
be a relationship between the employer and him as between employer and
employee or master and servant. It is necessary that a person to be a workman
must be in a 'contract o/service', and not contract for service.' Merely a contract
to do some work is not enough. An independent contractor is excluded from the
definition of workman as there does not exist the relationship of master and
servant in such a case. An independent contractor is not under the control of the
master. The element of control distinguishes an employee from an independent
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contractor.

In Dharangdhara Chemical Works, verses . State of Saurashtra, it was observed

that the uniformally applied test to determine employer-employee relationship
is the existence of the right in the master to supervise and control the work
done by the servant not only in directing what work the servant is to do, but
also the manner in which he shall do his work. that a person can be workman
even though he is paid not per day but by the job. If a person is a worker and
not a contractor it makes no difference that his work is piece work. It was
further observed in that case that to determine "whether a person is a
workman or an independent contractor is whether he has agreed to work
personally or not. If he has, then he is a workman and the fact that he takes
assistance from other persons would not affect his status." In this case the
Supreme Court held that the 'aghiaras' engaged in salt works (seasonal activity)
who had agreed to work personally, and on whom there was due control and
supervision having regard to the nature of work, are workmen even though
they employ other persons to assist them. Workman " and an Independent
contractor compared. The broad distinction between a workman and an
independent contractor lies in this that while the former himself agrees to work,
the latter agrees to get other persons to work. If a person who agrees himself to
work and so work is a workman. A workman does not cease to be a workman
by reason merely of the fact that he gets other persons to work along with him
and that those persons are controlled and paid by him. What detenuines
whether a person is a workman or an independent contractor is whether he has
agreed to work personally or not. If he , then he is a workman and the
factthathetakesassistance fromotherpersonswouldnotaffecthisstatus.

Hussainbhai, Calicut verses The Alath Factory Tezhilali Union, Kozhikode, AIR
1978 SC 1410.

a number of workmen were engaged in the making of ropes in a factory of the

petitioner but they were hired by contractors who had executed agreement
with the factory to get such work done. An industrial dispute arose when the
factory refused employment to 29 workers atid the matter was refened by the
State Government for adjudication, it was held by the Supreme Court the they
fell within the definition of'workman1. The Court said: "The facts found art that
the work done by the workmen was an integral part of the industry concerned.
that the raw material was supplied by the management, that the factory
premises belonged to the management and the finished product was taken by
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the management for its own trade. The workman was broadly under the control
of the management and rejected articles were directed to be rectified by the
management." Thus it was held that the workmen were workmen of the
petitioner Who is an employee in Labour Law? This was the short question
raised in the instant case but covered by earlier decision. The Court further said:
"The true test may, with brevity, be indicated once again. Where a worker or
group of workers labours to produce goods or services and these goods or
services are for the business subststance, skill, and continued employment. the,
for any reason, chokes off. the worker is, virtually, laid off. The presence of
intermediate contractors with whom alone workers have immediate or direct
relationship ex controctu is of no consequence when, on lifting the veil or
looking at the conspectus of factors governing employment, we discern the
naked truth, though draped in different perfect paper arrangement, that the
real employer is the Management, not the immediate contractor. Myriad
devices, half-hidden in fold after fold of legal form depending on the degree of
concealment needed, the type of industry; the local conditions and the like may
be resorted to when labour legislation casts welfare obligations on the real
employer, based on Articles 38, 39, 42, 43 and 43-A of the Constitution.

3. Nature of duties: To be a workman a person must be employed to do any

manual, unskilled, skilled, technical, operational, clerical or supervisory work
for hire or reward. Manual work involves hard physical work requiring use of
hands, e.g., a Mali looking after the gardens. Unskilled work requires no special
skill or training, e.g., a peon. Skilled work requires ability gained by special
experience or training, e.g.; a carpenter. Technical means dealing with the
practical, industrial or mechanical arts or the applied sciences. Technical work
involves the application of scientific or technical knowledge. Clerical work
means the work relating to office clerks. It involves minor duties such as typing
letters, filing letters, writing cash book, keeping records etc. It does not involve
excessive physical or mental work. Supervisory work, e.g., recommending leave
application, involves directing or managing the work of others. If the person is
employed in a supervisory capacity he must not be drawing wages exceeding
Rs. 1600/- per month and he must not be working mainly in a managerial
capacity.

In Burmah Shell Oil Storage and Distributing Co. verses Management Staff
Association it was held by the Supreme Court that if the work done by an
'employee' is not skilled or unskilled manual work, supervisory work, technical
work or clerical work, he would not be a workman. The specification of four
types of work is obviously intended to lay down that an employee is to become
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a workman only if he is employed to do work of one of those types, while there
may be employees who, not doing any such work, would be out of the scope of
the word "workman" without having to resort to the exceptions. The court held
that principle is now well settled that a workman must be held to be employed to
do that work which is the main work he is required to do even though he may be
incidentally doing other types of works.

In S. K. Maini v. M/s. Carona Sahu Company Ltd. & Ors3. The court held that
Whether or not an employee is a “workman” under Section 2(s) of the Industrial
Disputes Act is required to be determined with reference to his principal nature of
duties and functions. Such question is determined with reference to the facts and
circumstances of the case and materials on record and it is not possible to lay down
any strait-jacket formula which can decide the dispute as to the real nature of duties
and functions being performed by an employee in all cases. When an employee is
required to do more than one kind of work it becomes necessary to determine
under which classification under S. 2(s) the employee will fall for the purposes
of deciding whether he comes within the definition of workman or goes out of
it. The designation of an employee is not of much importance and what is
important is the nature of duties being performed by the employee. The
determinative factor is the main duties being performed by the employee
concerned and not some works incidentally done Viewed from this angle, if the
employee is mainly doing supervisory work but incidentally or for a fraction of
time also does some manual or clerical work, the employee should not be held
to be doing supervisory work. Conversely, if the main work is of manual, clerical
or of technical nature, the mere fact that some supervisory or other work is also
done by the employee incidentally or only a small fraction of working time is
devoted to some supervisory works, the employee will come within the purview
of "workman" as defined in S.2(s) of the Industrial Disputes Act. In the above
case, on facts, Incharge of shop was held not a workman The above case is
based upon the definition of workman before it was amended by Act 46of 1982
w.e.f 21.8.1984.

H.R.Adycmthaya verses Sandoz (India) Ltd4, the Supreme Court held that in
order to fall within the definition of workman, a person must be employed to do
any of categories of work mentioned in the main body of the definition (viz.,
manual, unskilled, skilled, technical, operational etc.) and it is not enough that
he is not merely covered by any of the four exceptions to the definition. it

3
1994 2 CLR 359
4
AIR1994SC2608
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further held that the word 'skilled' must be read ejusdem generis to mean skilled
whether manual or non-manual and as such medical representatives are not
skilled workmen, nor 'technical' or 'operational' workers. Their work is not
covered by any type of works mentioned in the main body of the definition.

BIBLIOGRAPHY
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Statutes referred

The Companies Act, 2013

The Companies (Share Capital & Debentures) Rules 2014

BOOKS: -
Avtar Singh, Company Law (English), Eastern Book Company, Edition 16, 2015
Sanjay Dhamija, G. K. Kapoor, Company Law (English) 17th Edition, Taxmann
Publications Pvt Ltd

ONLINE SOURCES

http://finance.zacks.com/importance-shares-1133.html

http://wisteriaformations.co.uk/articles/2013/01/what-is-the-importance-of-share-capital-
in- a-company
http://www.mca.gov.in/Ministry/pdf/CompaniesAct2013.pdf

 https://www.indiafilings.com/learn/shareholder-rights-companies-act-2013

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