2024:BHC-AS:19248

Neeta Sawant WP-2579-2017-FC

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

CIVIL APPELLATE JURISDICTION
WRIT PETITION NO. 2579 OF 2017

Mr. Jobi Joseph }…Petitioner

V/S.

1. M/s. Cadbury India Ltd.

2. Mr. Rajesh Ramanathan }...Respondents

Mr. Sanjay Singhvi, Senior Advocate with Mr. Rahil Fazelbhoy,

for the Petitioner.

Mr. Dhananjay J. Bhanage, for Respondents.

CORAM : SANDEEP V. MARNE, J.

Reserved On : 12 April 2024.
Pronounced On: 26 April 2024.

JUDGMENT :

1) By this petition, fled under Article 227 of the

Constitution of India, the Petitioner challenges the Order dated 1
April 2014 passed by the Labour Court, Mumbai in Complaint
(ULP) No. 225 of 2012. By the impugned Order, the Labour
Court has held that Petitioner is not an ‘employee’ within the
meaning of Maharashtra Recognition of Trade Unions &
Prevention of Unfair Labour Practices Act, 1971 (MRTU &

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PULP Act) and that therefore the Complaint fled by him

challenging his termination is not maintainable. The Order of the
Labour Court has been upheld by the Industrial Court by
dismissing Revision Application (ULP) No. 96 of 2014 fled by
Petitioner.

2) Cadbury India Ltd. (Cadbury) India’s premier

confectionery and sweet maker, which is also a global leader in
manufacturing of chocolates, and other allied products has
established wide distribution network in various parts of the
country. It has appointed various Regional Distributors (RD).
Such RDs, employ staf of their own for the purpose of marketing
and supply of products of Cadbury to wholesalers and retail
stores.

3) Petitioner joined the services of Cadbury on 17 June

2004 on the post of Sales Oficer and was confrmed in service
on 1 April 2005. He was subsequently promoted to the post of
Senior Sales Executive on 1 November 2011 and was drawing
gross salary of Rs.58,891/- per month at the relevant time.

4) According to Petitioner, though he was designated as

Senior Sales Executive, he performed various feld jobs relating
to sell and marketing of products of Cadbury in the retail and
wholesale outlets, through Cadbury’s RDs. That he was not
involved in supervisory, administrative or managerial nature of
work. That no employee of Cadbury was employed under
Petitioner and that he independently worked and reported to his

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superior oficers. Petitioner therefore claimed that he is a

‘workman’ as defned under Section 2(s) of the Industrial
Disputes Act, 1947 (I.D. Act) and consequently an ‘employee’ as
defned under Section 3(5) of the MRTU & PULP Act. Though
Petitioner mainly sought to press his status as ‘workman’ under
ID Act before the Labour Court while giving a hint of his role as
‘Sales Promotion Employee’, his main thrust in the Petition is
about his status as ‘Sales Promotion Employee’ within the
meaning of Sales Promotion Employees (Conditions of Service),
Act 1976 (SPE Act).

5) By letter dated 4 June 2012 issued by Cadbury,

Petitioner was informed of certain irregularities in his area while
opening of new outlets in February and March 2012 and was
accordingly withdrawn from that area. According to Petitioner,
he was not called for participation in any enquiry or was given
any new assignment. He was assigned the work of door-to-door
services and was assigned to perform miscellaneous jobs such as
visiting shops in slum areas for booking of orders. By letter
dated 1 October 2012, his services were terminated. Petitioner
states that termination was without following the statutory
provisions, in absence of show cause notice or any enquiry.

6) Petitioner therefore fled Complaint (ULP) No. 225 of

2012 in the Labour Court, Mumbai challenging the termination
letter dated 1 October 2012 and prayed for reinstatement with
continuity, backwages and all consequential benefts w.e.f. 1
October 2012. He also sought compensation of Rs. 1,00,000/-.

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Petitioner also fled application seeking interim relief.

Respondent-Cadbury appeared in the complaint and fled
Afidavit opposing application for interim relief and also raised
preliminary objection about maintainability of the Complaint
contending that Petitioner was not an ‘employee’ within the
meaning of Section 3(5) of the MRTU & PULP Act.

7) On account of preliminary objection raised by

Cadbury, the Labour Court framed preliminary issue and parties
led evidence on that issue. After considering the pleadings,
documents and evidence on record, the Labour Court proceeded
to pass Order dated 1 April 2014 on preliminary issue and held
that Petitioner’s Complaint is not maintainable as he was not an
‘employee’ within the meaning of MRTU & PULP Act. Petitioner
unsuccessfully challenged Order dated 1 April 2014 of the
Labour Court before the Industrial Court by fling Revision
Application No. 96 of 2014. The Industrial Court proceeded to
dismiss the Revision fled by him by Judgment and Order dated 1
March 2016. Aggrieved by the decisions of the Labour and the
Industrial Courts, Petitioner has fled the present petition. By
order dated 18 June 2018, this Court has issued Rule in the
present petition.

8) Mr. Singhvi, the learned senior advocate appearing for

Petitioner, would submit that the Labour Court has erred in
holding that Petitioner is not an employee within the meaning of
Section 3(5) of the MRTU & PULP Act. He would take me
through the defnition of the term ‘employee’ under Section 3(5)

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of the MRTU & PULP Act and would submit that in addition to
‘workman’ defned under Section 2(s) of the I.D. Act, a ‘sales
promotion employee’ as defned under Section-2(d) of the SPE
Act, is also an ‘employee’ within the meaning of Section 3(5) of
the MRTU & PULP Act. He would then take me through the
defnition of the term ‘sales promotion employee’ under Section
2(d) of the SPE Act. Mr. Singhvi would submit that even if a
person fails to establish that he is not a ‘workman’ within the
meaning of Section 2(s) of the I.D. Act but establishes that he is
a ‘sales promotion employee’ within the meaning of Section 2(d)
of the SPE Act, he still becomes an ‘employee’ within the
meaning of Section 3(5) of the MRTU & PULP Act.

9) Mr. Singhvi would further submit that the

Petitioner established before the Labour Court that he is a
workman within the meaning of Section 2(s) of the I.D. Act. He
would take me through the nature of duties performed by the
Petitioner as well as the evidence produced on record to indicate
as to how Petitioner performed clerical, manual, skilled and
unskilled work and clearly qualifed to be a Workman. Without
prejudice, Mr. Singhvi would submit that even if a Petitioner is
not held to be a workman within the meaning of Section 2(s) of
the I.D. Act, he must certainly prove before the Labour Court
that he is a ‘Sales Promotion employee’ within the meaning of
Section 2(d) of the SPE Act. That Petitioner was employed for
work related to promotion of sales and business. That Petitioner
was not engaged in supervisory capacity. That the Industrial
Court has ultimately held that Petitioner was not engaged in

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managerial or administerial capacity. That both the Courts have

erred in holding that Petitioner was engaged in supervisory
capacity.

10) Mr. Singhvi would submit that the fndings recorded

by the Labour and Industrial Courts about Petitioner’s
engagement in supervisory capacity are perverse and the same
are contrary to the evidence on record. That Cadbury could not
prove that Petitioner supervises even a single employee
employed by Cadbury. That supervision was sought to be
established by Cadbury is over employees of distributors. That it
has come on record that ‘Purple Champions’ were engaged by
the Distributors and that they are not employees of Cadbury.
That mere assistance given by Petitioner to such Purple
Champions employed by Distributors cannot and does not mean
that Petitioner supervised any of the employees of Cadbury. That
therefore the fndings recorded by the Labour and the Industrial
Courts that Petitioner was engaged in supervisory capacity are
perverse.

11) Mr. Singhvi would further submit that Petitioner

himself used to look after sales of products of Cadbury. That
several duties performed by Petitioner included direct
interaction with retail outlets. That he used to personally verify
whether equipment of Cadbury such as V.C. Coolers were
installed at appropriate locations of merchandisers. That the
duties performed by Petitioner clearly indicate that he was
engaged in direct sales activity of products of Cadbury in the

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area assigned to him. That Petitioner never decided any sales

targets, which were always decided by the other higher oficials
in Cadbury. That therefore the Labour and the Industrial Courts
have erroneously held that Petitioner worked in supervisory
capacity. Mr. Singhvi would further submit that Petitioner clearly
established before the Labour Court that he is an ‘employee’
within the meaning of Section 3(5) of the MRTU & PULP Act and
that the complaint fled before the Labour Court is clearly
maintainable. Mr. Singhvi would further submit that in the event
of this Court arriving at the conclusion that Petitioner is an
‘employee’ within the meaning of Section 3(5) of the MRTU &
PULP Act, this Court may directly decide his grievance about
termination since neither any enquiry was conducted nor
provisions of I.D. Act were followed while terminating the
services of the Petitioner. That since substantial period of time
has lapsed, this Court may grant the relief of reinstatement and
backwages rather than making Petitioner to undergo another
series of litigation for deciding the merits of his termination.

12) Per-contra, Mr. Bhanage the learned counsel

appearing for the Respondent-Cadbury would oppose the
petition and support the concurrent fndings recorded by the
Labour and the Industrial Courts. According to Mr. Bhanage,
there is no reason for this Court to interfere in well-reasoned
orders of the Labour and the Industrial Courts, which have
concurrently held after appreciating the evidence on record that
Petitioner is not an ‘employee’ within the meaning of Section
3(5) of the MRTU & PULP Act. That fndings recorded by the

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Labour and the Industrial Courts, do not sufer from the vice of
perversity and that therefore there is no reason for this Court to
interfere in such concurrent fndings. In support, Mr. Bhanage
would rely upon the judgment of the Apex Court in Syed Yakoob
V/s. K.S. Radhakrishnan and Ors1.

13) Mr. Bhanage would take me through various

documents produced on record to demonstrate as to how
Petitioner was repeatedly involved in intellectual and policy
work. That Petitioner was never responsible for direct sales of
products of Cadbury. That he was essentially supervising the
activity of sales of Cadbury’s products. That persons whom he
was supervising is irrelevant for the purpose of determining the
supervisory nature of work. That the real test is whether he was
supervising the activity of sales or not. That even though Purple
Champions were employees of Distributors, Petitioner
undoubtedly supervised their work, who were carrying out
actual activities of sales and canvassing of products. That
therefore supervisory nature of work of Petitioner was clearly
established. That SPE Act makes a marked diference between a
‘salesman’ and a ‘sales supervisor’. That SPE Act applies to
‘salesman’ and not to a ‘supervisor’. That, Petitioner in the
present case was undoubtedly a ‘sales supervisor’. That he fxed
targets for sale of products in the areas assigned to him. That he
was assigned team for carrying out the activities of sales. That
he took decision to shut distribution business of one of the
distributors. That he gave instructions from time to time to

1
AIR 1964 SC 477.

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various personnel for managing the activities of sales. That he

participated in policy decisions relating to sales of products of
Cadbury. Mr. Bhanage would therefore submit that supervisory
nature of functions performed by the Petitioner was clearly and
conclusively proved before the Labour Court. That Petitioner
drew substantial salary of Rs.58,891/- and was handling a team
of Purple Champions. He therefore can, by no stretch of
imagination, be treated as a ‘workman’ or ‘employee’. In support
of his contentions, Mr. Bhanage has relied upon the following
judgments:

i. Management of M/s. May and Baker (India) Ltd

V/s. Their Workman2.
ii. Burmah Shell Oil Storage and Distribution
Company of India Ltd. V/s. The Burma Shell
Management Staf Association and others3.
iii. Sh. T. P. Srivastava V/s. M/s. National Tobacco Co.
of India Ltd.4
iv. H.R. Adyanthaya and Others V/s. Sandoz (India)
Ltd. and others5.
v. Inthru Noronha V/s. Colgate Palmolive (India) Ltd.
and others6.
vi. Standard Chartered Bank V/s. Vandana Joshi and
another7.

14) Rival contentions of the parties now fall for my

consideration.

2
AIR 1967 SC 678.
3
1970 (3) SCC 378.
4
AIR 1991 SC 2294.
5
(1994) 5 SCC 737.
6
2005(2) Mh.L.J. 884.
7
2010(2) Mh.L.J. 22.

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15) Before adverting to the main issue involved in the

petition about Petitioner’s status as ‘employee’ within the
meaning of Section 3(5) of the MRTU & PULP Act, it would be
frst necessary to understand who exactly fall in defnition of the
term ‘employee’ under the MRTU & PULP Act. Section 3(5) of
the MRTU & PULP Act, defnes an ‘employee’ as under :

3. Definitions.

(5) “employee”, in relation to an industry to which the

Bombay Act for the time being applies, means an employee
as defned in clause (13) of section 3 of the Bombay Act,
and in any other case, means a workman as defned in
clause (s) of Section 2 of the Central Act, and a sales
promotion employee as defned in clause (d) of section 2 of
the Sales Promotion Employees (Conditions of Service)
Act, 1976.

16) Thus, under Section 3(5) of the MRTU & PULP Act,
three types of persons are to be treated as ‘employees’ viz.
(i) an employee as defned under Section 3(13) of
the Bombay Industrial Relations Act, 1946; or
(ii) a ‘workman’ defned under Section 2(s) of the
I.D. Act; and
(iii) a ‘sales promotion employee’ as defned under
Section 2(d) of the SPE Act.

17) The defnition of the term ‘employee’ under Section

3(5) of the MRTU & PULP Act would show that even if a person
does not ft into the defnition of the term ‘workman’ under
Section 2(s) of the I.D. Act, but can demonstrate that he is a

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‘sales promotion employee’ within the meaning of SPE Act, he

becomes an ‘employee’ under the MRTU & PULP Act. Thus a
person can demonstrate that he is either a ‘workman’ or a ‘sales
promotion employee’ or both, with a view to satisfy his status as
‘employee’ under Section 3(5) of the MRTU & PULP Act.

18) Perusal of the Order dated 1 April 2014 passed

by the Labour Court would indicate that the Labour Court has
not considered this fne distinction between a ‘workman’ and
‘sales promotion employee’. It appears that the enquiry before
Labour Court revolved around Petitioner’s status as ‘workman’
within the meaning of Section 2(s) of the I.D. Act. The order of
the Labour Court indicates that it has not even reproduced
defnition of the term ‘employee’ under Section 3(5) of the MRTU
& PULP Act and has mechanically proceeded to examine
whether Petitioner was ftting into defnition of the term
‘workman’ under Section 2(s) of the I.D. Act. It must be observed
that this folly committed by the Labour Court is possibly
attributable to the pleadings in Petitioner’s complaint. Though it
is strenuously contended before me by Mr. Singhvi that
Petitioner is a ‘sales promotion employee’ under Section 2(d) of
the SPE Act and therefore an ‘employee’, no such pleadings are
to be found in the complaint lodged by Petitioner before the
Labour Court. On the contrary, Petitioner pleaded before the
Labour Court that he was a ‘workman’ under Section 2(s) of the
I.D. Act and therefore an ‘employee’ under Section 3(5) of the
MRTU & PULP Act. The relevant pleadings in this regard in the
complaint are as under:

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The Complainant therefore states that though he is

designated as “Sr. Sales Executive” he is only deals with
confectionary/ sweets items and not with the personal
employed by the respondent no.1 herein. It is therefore
submitted that he is “Workman” as defned in Section 2(s)
of the Industrial Disputes Act, 1947 and thus as
“Employee” as defned in Section 3(5) of the MRTU &
PULP Act, 1971. It is therefore submitted that the
complaint fled by the complainant herein is well
maintainable in facts and in law. It is made crystal clear by
way of catena of judgments of the Apex Court that the
nature of duties performed by the employee is having
direct bearing on the designation and the designation
alone will not give him the mental/ status unless he
performs such duties.

19) There is no averment in the entire complaint that Petitioner

was a ‘sales promotion employee’ within the meaning of Section
2(d) of the SPE Act. However submission made on behalf of
Petitioner is recorded in Para 13 of Labour Court’s judgment that
he is a sales promotion employee governed by SPE Act. Though
the contention is recorded, the same is not decided by the
Labour Court by adverting to the provisions of SPE Act.

20) The defnition of the term ‘employee’ under Section 3(5)

of the MRTU & PULP Act came to be amended by Maharashtra
Act-22 of 1999 w.e.f. 20 April 1999 by adding ‘sales promotion
employee’ in the defnition of the term ‘employee’. Thus, as on
the date of fling of the complaint by Petitioner, every ‘sales
promotion employee’ as defned under SPE Act automatically
became an ‘employee’ within the meaning of Section 3(5) of the
MRTU & PULP Act. However, though Petitioner was engaged in
the activities of sale of products of Cadbury, it appears that he

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did not raise a plea before the Labour Court that he is a ‘sales
promotion employee’ and instead attempted to prove that he is a
‘workman’ under Section 2(s) of the I.D. Act.

21) It must be noted here that SPE Act was enacted in the year
1976 possibly in order to govern set of employees engaged in
promotion of sale of products and business of establishment, who
were not falling within the defnition of the term ‘workman’
under the I.D. Act. One of the objectives behind enacting SPE
Act was to apply the provisions of the I.D. Act to such class of
employees engaged in promotion of sales or business of an
establishment. This is because Section 6 of the SPE Act provides
that the provisions of the I.D. Act shall apply to Sales Promotion
Employees as they apply to or in relation to ‘workman’ within the
meaning of I.D. Act. Since SPE Act extends protection available
to a ‘workman’ under the I.D. Act to Sales Promotion Employees,
it is clear that those sales promotion employees were not ftting
into the defnition of the term ‘workman’. Thus, though Sales
Promotion Employees were extended benefts under the I.D. Act,
they were unable to maintain a complaint under the MRTU &
PULP Act, as they were not ‘workman’ within the meaning of
Section 2(s) of the I.D. Act. To redress this analogous position,
defnition of the term ‘employee’ under Section 3(5) of the MRTU
& PULP Act came to be amended and even a Sales Promotion
Employee came to be included within the defnition of the term
‘employee’ under Section 3(5) of the MRTU & PULP Act so as to
enable them to maintain a complaint under the MRTU & PULP
Act.

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22) Thus, the legal position appears to be that though a Sales

Promotion Employee does not ft into the defnition of the term
‘workman’, he is still treated as an ‘employee’ under the MRTU
& PULP Act. The combination of provisions of SPE Act and
MRTU & PULP act grants twin benefts of protection under the
I.D. Act as well as under the MRTU & PULP Act to Sales
Promotion Employees. This is the broad statutory framework and
interplay between the provisions of the I.D. Act, SPE Act and
MRTU & PULP Act.

23) The above statutory framework has been considered by this

Court in Kiran P. Pawar vs. Bata India Ltd., 2023 SCC (Bom)
13, wherein this Court has observed in Para 29 as under:

29. Thus every sales promotion employee as defned under

Section 2(d) of the SPE Act, 1976 automatically become an
“employee” within the meaning of MRTU & PULP Act and
is entitled to fle complaint under Section 28 of that Act
before Labour Court or Industrial Court. However, since
the provisions of SPE Act are admittedly not
extended/notifed to the establishment of Bata, the
salesmen of Bata can neither be treated as sales promotion
employee under SPE Act, 1976 nor “employee” on that
strength under the MRTU & PULP Act. Therefore it is
necessary for salesmen of Bata to prove that they are
workmen on the strength of nature of duties and
responsibilities performed by them.

24) SPE Act was made applicable in the frst instance to every
establishment engaged in pharmaceutical industry. However,
under section 1(5) of the SPE Act, the Central Government can
apply provisions of the Act to any other establishments engaged

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in notifed industry by issuing a Notifcation in the Oficial

Gazette. Section 3 empowers the Central Government to declare
certain industries to be notifed industries. Sections 1 and 3 of
SPC Act provide thus:

1. Short title, extent, commencement and

application.

(1) This Act may be called the Sales Promotion Employees

(Conditions of Service) Act, 1976.

(2) It extends to the whole of India.

(3) It shall come into force on such date1as the Central

Government may, by notifcation in the Oficial Gazette,
appoint and diferent dates may be appointed for diferent
States.

(4) It shall apply in the frst instance to every

establishment engaged in pharmaceutical industry.

(5) The Central Government may, by notifcation in the

Oficial Gazette, apply the provisions of this Act, with ef-
fect from such date as may be specifed in the notifcation,
to any other establishment engaged in any notifed indus-
try.

3. Power of Central Government to declare certain

industries to be notified industries::
The Central Government may, having regard to the nature
of any industry (not being pharmaceutical industry), the
number of employees employed in such industry to do any
work relating to promotion of sales or business or both,
the conditions of service of such employees and such other
factors which, in the opinion of the Central Government,
are relevant, declare such industry to be a notifed
industry for the purposes of this Act.

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25) It appears that in exercise of powers under Section 3 of the

SPE Act, the Central Government has issued Notifcation dated
31 January 2011, notifying that the provisions of the SPE Act
shall apply to various industries including the industries of
‘Biscuits and Confectioneries’. The Notifcation reads thus:

GAZETTE OFINDIA, EXTRAORDINARY,

PART II, SECTION 3(1), DATED 31ST JANUARY 2011
MINISTRY OF LABOUR & EMPLOYMENT
( Coordination Section)
NOTIFICATION
New Delhi, dated 31 January 2011
S.C. 217 (E):- In exercise of the powers conferred by Sec-
tion 3 of the Sales Promotion Employees (Conditions of
Service) Act, 1976 (11 of 1976), the Central Government,
having regard to the nature of the industry, the number of
employees employed in such industry to do any work relat-
ing to promotion of sales or business or both, the condi-
tions of service of such employees and such other factors
which in its opinion relevant, hereby declare the following
industries to be a notifed for the purposes of the said Act,
with efect from the date of publication of this notifcation
in the Oficial Gazette, namely:-
1. Cosmetics, soaps, household cleaners and disinfectants
2. Readymade garments
3. Soft drink manufacturing industries
4. Biscuits and confectioneries
5. Ayurvedic, Unani and Homeopathic Medicines
6. Automobiles including accessories and spare parts
7. Surgical equipments, artifcial prosthesis and diagnos-
tics
8. Electronics, computers including accessories and spares
9. Electrical appliances
10. Paints and varnishes
(F.No.Z-200251301201 0-Coord.)
K.M.Gupta, Economic Advisor

26) Thus, it appears that since ‘biscuits and confectioneries’

industry is notifed under Section 3 of SPE Act, the Act would

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apply to Cadbury. Mr. Bhanage has not seriously disputed this

position.

27) The next issue for consideration is whether Petitioner fts

into the defnition of the term ‘sales promotion employee’ within
the meaning of SPE Act. There is no dispute to the position that
Petitioner performed work relating to promotion of sales or
business of Cadbury. The only dispute is whether he was
engaged in supervisory, managerial or administrative capacity.
The Industrial Court has held in para-17 as under :

17. There was Manager’s comment as “Very good distribution

and EBD for Jobi”. None of these clauses of letters are in dispute
till date. So I have no hesitation to observe that the applicant
was answerable to the authority of the respondents. So, he
cannot be said to be a person in management or
administration, but at the same time there were other persons,
who are referred as RD & PC in the team.

(emphasis supplied)

28) Thus, the Industrial Court has held that Petitioner cannot
be said to be a person in management or administration. Thus,
the controversy is now restricted to Petitioner’s employment or
engagement in supervisory capacity. It is Mr. Bhanage’s
contention that Petitioner was employed in supervisory capacity
and that therefore he does not ft into the defnition of the term
‘sales promotion employee’. On the contrary, it is the contention
of Mr. Singhvi that Petitioner was engaged directly in sale of
products of Cadbury and that he did not supervise any of the
employees of Cadbury and that therefore he cannot be treated to
have been employed in supervisory capacity. Petitioner pleaded

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in his Complaint that he performed following duties as Senior

Sales Executive during the course of his employment with
Cadbury.

i) I am given monthly and yearly sales targets and I have to

follow this on daily basis.
ii) Visit and sell company's products to retail and wholesale
outlets.
iii) I book suitable window display, spaces in the shops for
products promotion.
iv) Visit eligible outlets in the market and make contacts with
shopkeepers to keep company visi-coolers to assure sales
promotion, sales growth and optimum quality of the
product as per guidance.
v) We have to achieve 38% sales growth in all big groceries,
31% growth in small groceries and 32% sales growth in all
chemist shops in our respective areas. (company changes
the statistics every year.)
vi) I am assigned the job of fnding and opening of new outlets
in the market every year as directed.
vii) We have to ensure medium and small size wholesalers are
growing by 35% on last year sales basis. We have to check
all company suggested products are invoicing to these
wholesalers and achieve 60% MSS (Must Sell Sku's).
viii) I have to verify whether all our distributor's godown are
kept spic and span and airconditioned wherever required
The air-conditioned godown have to be strictly maintained
at a specifc temperature 24x7. We also check their
delivery vehicles are properly maintained to ensure our
product quality. This I have to do with specifcation as
directed by the company.
ix) I have to maintain all display outlets properly and see to it
that these outlets are getting 80% display score as per
company rules. Every month company send auditors to
these outlets to cross check.
x) I have to achieve given value sales growth over last year
as targeted by the company value wherever company
deployed visi-coolers and SMDs(sheet metal dispenser).
xi) Make possible without giving the shopkeeper any display
incentives and have relation with the shopkeeper to get
additional space to display our products.

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xii) I have to ensure minimum damage stocks comes back

from market, no write-ofs and no goods return from
distributor to Company. On every three month time we
have to take 'All Clear Certifcate' from distributor and
have to submit in Company ofice.
xiii) To ensure customer satisfaction we follow up daily with
the shopkeepers in the market and see to it that they
follow the FIFO (First In First Out).
xiv) In our daily visit in the market I fll up Cadbury stocks in
Company's visi-cooler as well as dispensers at retailer
point and see to it there are no competitive products are
kept in the same etc.

29) Cadbury led evidence of Mr. Abdul Gafur Sakir Khan,

employed as Salesman in Gopaldas Corporation. He gave
evidence about the nature of duties performed by him as
Salesman of Gopaldas Corporation, which was the Distributor of
Cadbury in the designated area. He deposed that Petitioner was
employed as a Sales Oficer in Masjid Bunder area for
management of sale of products of Cadbury. That he used to
supervise the salesmen of Gopaldas Corporation and earlier of
Shifa Marketing. That such salesmen were also referred to as
‘Purple Champions’. That they used to submit reports of their
sales to Petitioner every evening. That Petitioner used to guide
them with regard to performance of their duties. That Petitioner
used to fx targets every month or week. That the salesman used
to visit various retail shops and the work was controlled and
supervised by Petitioner. That Petitioner used to give instructions
about quality of products as well as priority to be given to a
particular wholesaler and retail outlets. That Petitioner used to
guide the shop owners for exhibition of products of Cadbury at
particular location in the shop and used to negotiate with the

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shop owners for exhibition of products of Cadbury and that the

shop owners used to get incentives as per the recommendations
of Petitioner. That Petitioner used to recommend the place in the
shop for installation of Visi Coolers and used to ensure that the
Visi Coolers were correctly installed in the shop.

30) Cadbury also led evidence of Mohammed Faizal,

Senior Area Sales Manager employed by Cadbury and who was
Petitioner’s supervisory oficer. Mr. Mohammed Faizal deposed
before the Labour Court that Cadbury products were being
distributed through two distributors namely, Gopaldas
Corporation and Shifa Marketing in Masjid Bunder area. That
Petitioner used to explain various schemes launched by Cadbury
for promotion of sales of its products to the salesmen and guide
them in conveying the same to the wholesalers and retailers.
That salesmen are responsible for display of products of Cadbury
in the outlets. That after receiving reports from salesmen about
availability of appropriate space in the outlet for display of
Cadbury’s products, Petitioner used to discuss and negotiate
with shop owners for display of such products. That Petitioner
used to visit the customers to ensure that the salesmen had
visited their establishments and products were delivered on time
and as per the requirement. He further deposed that all the
salesmen used to report to Petitioner about sales, delivery,
payments etc. That Petitioner did not do or perform any manual,
skilled or unskilled, technical, operational or clerical work. That
the duties pleaded in para-3(c) of the complaint were not
personally performed by the Petitioner. In the cross-examination,

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some suggestions were given and some admissions are sought to

be extracted from the witnesses particularly from
Mr. Mohammed Faizal about lack of authority for Petitioner to
fnalise schemes or to take policy decisions.

31) I have also gone through the evidence of Petitioner.

Though he has stated in the Complaint and repeated in his
Afidavit-of-Evidence that his duties included ‘ Visit and sell
company's products to retail and wholesale outlets’, it has
come in evidence that the work of taking orders used to be
performed by the salesmen/purple champions of
Distributors, who used to take orders on Palmtops and
follow up for payment. That they used to report about
defaulting shopkeepers to Petitioner. It has also come in
evidence Cadbury used to introduce schemes for providing
incentives to retailers and that Petitioner used to educate
and explain those schemes to salesmen of Distributors, who
in turn used to inform the retailers about such incentive
schemes. Thus there is no evidence on record to show that
Petitioner personally used to visit retailers for booking
orders. That job was done by the salesmen of the
distributor.

32) I have also gone through the various documents

placed on record, which were also relied upon by Cadbury to
prove supervisory nature of duties by Petitioner. The email
correspondence placed on record would indicate that Petitioner

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had given various instructions/requests to Mr. Mohammed Faizal

for imparting of training to Purple Champions, for deduction of
amounts from distributors, communicating income targets for
various months, etc. The documents relating to performance
review of the Petitioner are also placed on record to show that
Petitioner was handling the team. That he was setting goals etc.
In one of the performance reviews pertaining to the year 2011,
Petitioner has sought credit for taking initiative for closure of
distributorship of Shifa Marketing. He has stated that “so I
decided to close his business in the month of March and in the
month of May. I closed him swiftly”. It is contended by Mr.
Bhanage that Petitioner thus took a policy decision of closing
distributorship of major distributors. Reliance is also placed on
email dated 8 January 2013, which was written in relation to
damaged stock lying with some of the retail outlets. It was
contended in the email that some of the big wholesalers in
Masjid Bunder were not reimbursed despite sending damaged
goods to Shifa Marketing. In the email, Petitioner suggested that
to solve the issue of damaged goods, he instructed Gopaldas
(distributor) to clear damaged stock from the market and stated
that Cadbury will have to reimburse the amount to Gopaldas in
respect of damaged stock. According to Mr. Bhanage, these are
policy decisions taken by the Petitioner.

33) After considering the documents and evidence on record, I

am of the view that Petitioner himself was not selling or
canvassing the sale of products of Cadbury. Cadbury had
employed the concept of appointing distributors who used to

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employ their own employees for the purpose of promoting sales

of products of Cadbury. Thus, the Purple Champions/salesmen of
distributors were actually responsible for promotion of sale of
Cadbury’s products at retail and wholesale outlets. Such
salesmen/Purple Champions, visited various establishments,
retailers/wholesalers collected orders and ensured distribution.
What Petitioner essentially did was to supervise the activities of
salesmen/purple champions of distributors. There is ample
evidence on record to show that Petitioner’s main role was to
ensure that targeted sales are achieved through salesmen
appointed by the distributors. He used to guide such salesmen to
ensure targeted sales. His occasional visit to the shops/outlets
either to negotiate display of products or for installation of Visi
Coolers did not mean that his predominant duty was to carry out
direct sales activities of products of Cadbury. Those activities
were actually carried out by salesmen/Purple Champions of
Cadbury and Petitioner mainly supervised them.

34) In my view, for taking activities of a person outside the

scope of supervisory capacity, it is necessary to prove that such
person is engaged in direct activities of canvassing the products
or business to the customers or retailers. In Burmah Shell
(supra), the Apex Court has considered the nature of duties
performed by District Sales Representatives and Sales
Engineering Representatives. Before discussing the fndings
recorded by the Apex Court in Burmah Shell, it must be clarifed
that the duties of various category of staf is considered by the
Apex Court for determining their status as ‘workman’ and not as

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‘sales promotion employee’. However the discussion is useful for

limited purpose of understanding the supervisory nature of
duties and role of sales promotion employee in canvassing
company’s products:

26. Manmohan Singh, Marketing Services and Planning

Manager of the Company, explained that a Sales Engineer-
ing Representative is employed primarily to support the
sales eforts by providing after sales service and advice to
the customers on optimum utilisation of fuels and lubri-
cants. According to him, the principal duty of a Sales Engi-
neering. Representative is to provide such service and to
guide and supervise the workers employed in customers'
plants to ensure eficient use of fuels and lubricants. His
duties have been described as complementary to the du-
ties of the District Sales Representative. He, however, did
admit that the Sales Engineering Representative has to
give demonstrations regarding use of fuels and lubricants,
and such demonstrations are conducted by him, though
part of the work in the demonstration is done by the work-
ers of the customer concerns. It is true that there is no
subordinate personnel attached to him. The Tribunal it:
self held that the main work to be performed by Sales
Engineering Representative is promotion of sales
which are canvassed primarily by District Sales Rep:
resentative. This the Sales Engineering Representa:
tive does by giving technical advice, holding demon:
strations and suggesting methods for making best
use of the products sold. On these facts, the Tribunal,
in our opinion, rightly held that the Sales Engineer:
ing Representative is not employed on supervisory
work; but the Tribunal did not proceed further to examine
whether he was employed on any other work of such a
type that he could be brought within the defnition of a
workman. There is no suggestion at all that he was em-
ployed on clerical work or manual work. Reliance was
placed on the word “technical” used in the defnition of a
workman. The amount of technical work that a Sales Engi-
neering Representative does is all ancillary to his chief
duty of promoting sales and giving advice. As we have held
earlier, the mere fact that he is required to have technical
knowledge for such a purpose does not make his work
technical work. The work of advising and removing com-

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plaints so as to promote sales remains outside the scope of

technical work. Consequently, the Tribunal's decision that
the Sales Engineering Representative is a workman is set
aside.
This extract is taken from Burmah Shell Oil Storage and
Distribution Co. of India Ltd. v. Burma Shell Management
Staf Assn., (1970) 3 SCC 378 at page 400
36. The case of the last category viz. District Sales Rep-
resentatives could not be seriously pressed by Mr Chari
before us. He did state that his claim is that they are em-
ployed to do clerical work but the facts make it manifest
that District Sales Representative, is principally em:
ployed for the purpose of promoting sales of the
Company. His main work is to do canvassing and ob:
tain orders. In that connection, of course, he has to carry
on some correspondence, but that correspondence is inci-
dental to the main work of pushing sales of the Company.
In connection with promotion of sales, he has to make rec-
ommendations for selection of agents and dealers; exten-
sion or curtailment of credit facilities to agents, dealers
and customers; investments on capital and revenue in the
shape of facilities at Agents' premises or retail outlets and
selection of suitable sites for retail outlets to maximise
sales and negotiations for terms of new sites. He is, in fact,
Company's representative in his district responsible for all
matters afecting the Company's interests and, in particu-
lar, the proftable sale of all its products. His case was
urged primarily on the basis of the argument advanced by
Mr Chari that the defnition of “workman” is now exhaus-
tive and every employee of an industry must be classed
amongst one of the four classes described in the defnition
of workman. We have already given our reasons for reject-
ing this submission. The case of District Sales Representa-
tive is clearly that of a person who cannot fall within any of
the four classes, because his work cannot be held to be ei-
ther manual, clerical, technical or supervisory. The work of
canvassing and promoting sales cannot be included in any
of these four classifcations. He is, therefore, not a work-
man at all within the principal part of the defnition, and
the decision of the Tribunal is correct.

(emphasis supplied)

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35) Thus as held in Burmah Shell, it is only when a person in

involved in canvassing and obtain orders by holding
demonstration or suggesting the best use of the product, etc that
such person can be held to be not engaged in supervisory
capacity. In the present case, there is no evidence to suggest
that the primary duty of Petitioner was to canvass the products
of Cadbury either to customers or to wholesalers/retailers.

36) In T. P. Srivastava, the Apex Court gas considered the

distinction between ‘canvassing and promoting sales for the
company’ and ‘supervising salesmen’. It is held in Para 3 as
under:
3. In order to come within the defnition of workman under
the Industrial 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. manual,
skilled and/or clerical in nature. The fnding of the
Tribunal on the nature of the work is a fnding on a
question of fact and it 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 means to
improve the sales, a study of the type or status of 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 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

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decision of this Court in Burmah Shell Oil Storage and

Distribution Company v. Burmah Shell Management Staf
Assn. [(1970) 3 SCC 378 : AIR 1971 SC 922 : (1970) 2 LLJ
590] , D.S. Nagaraj v. Labour Oficer, Kurnool [(1972) 42
FJR 440 (AP)] , J & J Dechane Distributors v. State of
Kerala[(1974) 2 LLJ 9 (Ker)] . We may also refer to the
subsequent passing of the Sales Promotion Employees
(Conditions of Service) Act, 1976. This Act defnes “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.
This Act is to apply in the frst instance to every
establishment engaged in pharmaceuticals industry. It
enables the Central Government by notifcation to apply
the provisions to any other establishment engaged in any
notifed industry. If an industry is notifed 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. Further no notifcation 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 promotion normally would not come
within the defnition of workmen under the Industrial
Disputes Act.

37) Thus in T. P. Shrivastava the main duties of the Appellant

therein was to do canvassing and promoting sales for the
company and the job of supervising the salesmen was only part
of or incidental to the main work of canvassing and promotion in
the area of his operations. Conversely, in the present case, the
main duty of Petitioner appears to be to supervise the salesmen /
purple champions of the Regional Distributors and occasionally
he was paying visits to the stores for negotiating the place of
display of Cadbury’s products, or for installation of Visi Coolers.

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Thus the main job of Petitioner was to supervise the activities of

sales performed by the salesmen of Regional Distributors and
activities of interactions with the retailers and wholesalers was
incidental to his main supervisory duties.

38) It is sought to be contended by Mr. Singhvi that supervision

by Petitioner of employees of distributors does not mean that
Petitioner was employed in supervisory capacity. I am unable to
agree. What is relevant under Section 2(d) of the SPE Act is that
a person should not be ‘employed or engaged in a supervisory
capacity’. So what is important is ‘employment/engagement in
supervisory capacity’. The words used under Section 2(d) are
not ‘employment/engagement as a supervisor’. What is relevant
is the ‘capacity’ in which the engagement is made. The nature of
duties performed by a person would determine whether his
employment is in supervisory capacity and not to determine
whom he supervises, which is irrelevant. If Petitioner was to
himself perform the activity of promotion of sales or business of
Cadbury, he would ft into the defnition of the term ‘sales
promotion employee’. However, in the present case, he was
merely supervising other salesmen, who were carrying out the
activities of sales and promotion of Cadbury’s products.
Therefore, even though Petitioner was supervising salesmen
employed by distributor, the same would not mean that his role
was not that of supervisory capacity. In a given organisation, it
may happen that a Manager or Supervisor may have to supervise
the activities of either contract workers or transporters.
However, merely because he supervises activities of persons who

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are not direct employees of an establishment, it does not and

cannot mean that he ceases to be employed in supervisory
capacity. Therefore, the real test for determining supervisory
nature of duties is not whether persons on whom supervision is
exercised are employees of establishment or not, but the nature
of duties attached to the job. After considering the evidence on
record, I am fully convinced that Petitioner performed
supervisory nature of duties while working as Senior Sales
Executive with Cadbury. In my view, therefore Petitioner does
not ft into the defnition of the term ‘Sales Promotion Employee’
within the meaning of Section 2(d) of the SPE Act.

39) So far as status of Petitioner as ‘workman’ under Section

2(s) of the I.D. Act is concerned, both Labour as well as
Industrial Court have concurrently held that apart from
performing supervisory nature of duties, Petitioner did not
himself perform any manual, skilled, unskilled or clerical work.
Since he drew gross salary of Rs.58,800/- per month, his
employment in supervisory capacity put him outside the purview
of defnition of the term ‘workman’ under Section 2(s) of the I.D.
Act.

40) I am therefore of the view that Petitioner was neither a

‘workman’ within the meaning of Section 2(s) of the I.D. Act nor
a ‘sales promotion employee’ within the meaning of Section 2(d)
of the SPE Act. Therefore, Petitioner was not an ‘employee’
within the meaning of Section 3(5) of the MRTU & PULP Act and

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his complaint fled before the Labour Court was clearly not
maintainable.

41) Mr. Bhanage has relied upon several judgments in support

of the contention that Petitioner does not ft into the defnition of
the term ‘workman’. However, as observed above, even if a
person is not a ‘workman’, but proves that he is a ‘Sales
Promotion Employee’, he would still be covered under the
defnition of the term ‘employee’ within the meaning of Section
3(5) of the MRTU & PULP Act. Infact, though the sheet anchor of
Mr. Bhanage is judgment of this Court in Standard Chartered
Bank (supra) in my view, the said judgment is also of limited
relevance to the present case as the issue involved before this
Court was whether the Respondent therein was ‘workman’
within the meaning of Section 2(s) of the I.D. Act. In the present
case, Petitioner has also attempted to demonstrate that he is a
‘Sales Promotion Employee’ within the meaning of Section 2(d)
of SPE Act. To that extent, rest of the judgments relied upon by
Mr. Bhanage are of little assistance for determining the issue at
hand. His reliance on judgment of the Apex Court in Syed
Yakoob would be relevant to the extent of concurrent fndings
recorded by the Labour and the Industrial Court on the issue of
Petitioner’s status as ‘workman’ within the meaning of Section
2(s) of the I.D. Act. Following the judgment in Syed Yakoob
(supra), this Court is not inclined to interfere in concurrent
fndings of facts recorded on the issue of Petitioner’s status not
being that of a ‘Workman’ under Section 2(s) of the I.D. Act.

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42) Considering the overall conspectus of the case, I am unable

to trace any patent error in the orders passed by the Labour and
the Industrial Court. Those Orders are unexceptionable. The Writ
Petition accordingly fails. The Writ Petition is dismissed with no
order as to costs. Rule is discharged.

SANDEEP V. MARNE, J.

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