PepsiCo India vs Grocery Markets: Mathadi Act Dispute and Supreme Court’s Decision

The case between PepsiCo India Holdings Pvt. Ltd. and the Grocery Markets & Shops Board & Ors. revolved around the application of the Maharashtra Mathadi, Hamal, and Other Manual Workers (Regulation of Employment and Welfare) Act, 1969. The dispute reached the Supreme Court after PepsiCo challenged a Bombay High Court ruling that required it to approach the State Government for resolution under Section 5 of the Act.

Background of the Case

PepsiCo India Holdings Pvt. Ltd. (appellant) approached the Supreme Court challenging the judgment dated July 22, 2009, passed by the Bombay High Court in Writ Petition No. 4937 of 2009. The primary contention was regarding the applicability of the Mathadi Act Scheme to the company’s operations.

Petitioner’s Arguments

Senior counsel Mr. V. Giri, representing PepsiCo, argued that there was also a challenge to the application of the Act itself, apart from the specific scheme. He contended that the company should not be subject to the provisions of the Mathadi Act as its employees did not fall under the category of ‘unprotected workers’ as defined under the Act.

Respondent’s Arguments

The respondents, including the Grocery Markets & Shops Board, maintained that the Mathadi Act was enacted to provide welfare measures to manual workers, and PepsiCo was bound to comply with its provisions. They argued that the High Court’s decision directing the company to approach the State Government under Section 5 was appropriate.

High Court’s Judgment

The Bombay High Court issued the following directions:

• The petitioner (PepsiCo) was directed to make an application under Section 5 of the Mathadi Act within eight weeks.
• The State Government was required to entertain the reference and decide within twelve weeks, giving all concerned parties an opportunity to be heard.
• Workers identified by the Board as covered under the Scheme would continue to have their services protected for twelve weeks, with PepsiCo providing work and payment as per Board directions.
• The petition was disposed of, making the rule absolute per these directions.

Supreme Court’s Decision

The Supreme Court, in its ruling, upheld the procedure laid down by the High Court while clarifying that PepsiCo could raise all disputes related to the factory at Rajangarh and the warehouse at Panvel before the State Government. The Court also extended the deadline, allowing PepsiCo an additional twelve weeks to raise these disputes.

The Supreme Court further clarified that it had not considered the appeal on merits and left all contentions open for both parties. The interim order passed earlier on November 18, 2010, was to continue until the government’s decision was made.

Conclusion

The Supreme Court’s ruling emphasized adherence to the statutory mechanism prescribed under the Mathadi Act for resolving disputes. It directed PepsiCo to approach the State Government as per the Act’s provisions while ensuring that the workers’ rights were protected during the pending resolution.

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Download Judgment: PepsiCo India Holdin vs Grocery Markets & Sh Supreme Court of India Judgment Dated 04-02-2016-1741852565771.pdf