Professional Documents
Culture Documents
include (a) Transport Cooperative Society, Koppa, (b) The Indian Coffee House, and
(c) The Kerala Dinesh Beedi. The background of the sample units given here forms the
from the erstwhile Shankar Transport company (Private) Limited. The Shankar Transport
Company was started in 1957 by late Sri. M S Deve Gowda. Later, it was taken over and
managed by the Aroor family, throughout the 70s and 80s4. During those years,
Shankar Transport Company was considered to be one of the efficient bus services in
Shimoga, Chikkamagalur and some parts of South Kanara Districts, comprising nearly
It was a well-known fact that the workers in this company were paid low. But not much
resistance was seen from the workers for almost two decades. However, the genesis and
rise of any movement is greatly influenced by the economic and social system in which it
operates. Low wages, a rising cost of living, pay hike in Gajanana Transport Company,
workers affiliation to Chikkamagalur Unit of Transport and General Mazdoor Union (R),
etc., brought about an awakening among the workers and accordingly, they resorted to
workers who were in the forefront of the agitation. It also suspended some workers and
initiated various other tactics to crush even the smallest resistance. The strike did not
produce the desired result, the reason being - lack of effective leadership. As usual, the
Shankar Transport Company continued to pay less than the Minimum Wages fixed by
the Government.6
The agreement pertaining to salary and other terms and conditions entered between the
workers and management during 1987 ended on 30th June 1990. Hence, on 1st July
1990, the Workers Union submitted the Charter of Demands to the management. The
major demands included: an average increase in the salary to the extent of Rs. 225 per
month, granting of medical allowance of 8 per cent of salary, payment of shift allowance,
increase in the daily bata, dearness allowance as per cost of living index, granting of
HRA of Rs. 100 per month, leave facilities, payment of shift allowance and giving free
Company failed to respond positively to the workers' demand. Finally the workers led by
Sri. Chikke Gowda, supported by All India Trade Union congress (AITUC) and
contemporary trade union leaders like Sri B.K. Sunderesh and Sri. Renukaradhya, started
positive came out from the Demand Week, or Hunger Strike and many rounds of
discussions held between workers and management. Even the conciliatiory efforts
Chikkamagalore district under Section 12(1) of Industrial Disputes Act of 1947 failed to
Chikkamagalur Jilla Transport and General Mazdoor Sangha, Koppa, fay the chief Administrative Officer of
Shankar Transport Company. In this connection, we have observed that the minimum wages fixed by the
Government for a bus driver at that time was Rs.950. But the salary statement of Shankar Transport Company
as on 13-12-1990 shows that Rs.606 had been paid as minimum wages for drivers.
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General Mazdoor Sangha(R), supported by All India Trade Union Congress (AITUC)
and other Leftist organisations started total strike on 15th December 1990. This strike
paralysed the whole bus transport in and around Malnad Region affecting bus services of
nearly eighty routes of Koppa, Kalasa, Balehonnur, Sringeri and N R Pura Talukas. The
strike continued, but the Management or the Government did not show any positive
signs in resolving the issue. Sri Aroor Manohar Rao, the then Managing Director of
Shankar Transport Company rejecting the demand of workers announced in the Press
...it is extremely difficult to run buses in the present situation. The catastrophe of Gulf
war is mainly responsible for the shortage of diesel and petrol. The fuel prices are
shooting up like anything. So I cannot foresee any bright future to this industry.
(Udayavani, 1991)
The peaceful strike lasted 53 days. On 6th February 1991, the whole Malnad region
supported the cause of Shankar Transport Employees Union. Sri Chikke Gowda, leader
However, the Management was very firm on its stand and did not agree to pay salary
equal to that of other transport companies. Instead, the Management declared lock out on
7-2-91 and retrenched all the workers. Within a few days the management of Shankar
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provokes strong emotional reactions among the workforce - shock, disbelief, anger and
employment and the stability that a company gives is attacked at roots once a unit is
closed. Since the decision for a closure affects their lives so much, they rightly believe
On hearing the shocking news of lockout the Transport Union convened its General
Body Meeting and decided to withdraw the strike. Accordingly, on 8-2-91, the Workers
Union submitted the Strike Withdrawal Notice to the Management.7 But the Management
Now, it had become imperative on their part to strive hard to save their jobs.
Sri. B.K Sunderesh, local communist leader was mainly responsible for promoting the
protect their jobs in the closed unit. Initially, the workers explored all possible avenues to
get the transport unit run by the management. It was only when they failed in their efforts
Letter No 482/90-91. addressed to Managing Director, Shankar Transport Company Limited, signed by the
President and Secretary ofTransport Ma/door Sangha.
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to find a solution, that the workers volunteered to ran some buses and control then-
destiny.
Transport Authority held on 11-2-91, under the chairmanship of Dr. S. Subramanya, the
Employees Union of Shankar Transport Company got six permits and permission to ran
seven buses, on cooperative basis and also sought permission to ran 35 to 40 buses
(Malanada Sangathi, 1991). All the 273 workers got their compensation amount from
Shankar Transport Company, out of which a group consisting of 130 workers agreed to
On the other side the Shankar Transport Company, in a bid to escape from its problems
Transport.8 All these four units agreed to provide employment to 100 loyal employees.
Thus, the TCS started its operations in the selected routes of Malanadu region from 8th
March 1991. The Union Leader and former Mechanic of Shankar Transport Company
Sri Chikke Gowda was the Chief Promoter along with ten other workers as
8Secdon 71(4) and (5) of Motor Vehicles Act stipulates that fresh permits to the extent of 10 bos permits could
be given to single holder In this case Shankar Transport Companys request to start buses after the strike was
treated as a fresh case because they surrendered majority of their permits to Government of Karnataka So they
have to split their operations into four units to ran 40 buses. But the Amendment Act of 1994, removed this
restriction.
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Co-promoters. Later, on May 16th 1991, the TCS got registered with Joint Registrar,
Chikkamagalur and started its efficient operations and various expansion programs.
It may be observed that the Shankar Transport Company was a very efficient company
until 1987, but its efficiency was also dependent on the exploitative nature of handling
the employees. The sense of insecurity and also a kind of deprivation were prevalent
among the employees for a very long period of time. But, they were, somehow, not able
to come together and succeed in resisting it. However, during 1987, all of them joined
together and they did go for some kind of protest. But, as a result of lack of effective
After this failure, they went back to work and they found that they were subjected to
more exploitation. This insecurity and exploitation and also a feeling of humiliation of
the failure of their earlier attempt were there in their mind and they were waiting for
proper leadership. So, when it came, they were able to organise themselves and start their
own enterprise.
Cooperative Society Limited. The important objectives of the society as stated in its by
laws are:
3. To obtain and establish agency to deal with oil, lubricants and spare parts.
6. To inculcate the feeling of mutual help, economy and cooperative idea among the
members.
9. To raise money by the issue of shares to conduct the business of the cooperative
society after adhering to the rules and regulations of Companies Act or any
provisions of the Central Government and orders passed by the Registrar of the
Cooperative Society.
2. B Category Members - those who have got experience in repairing motor vehicle and
other machineries connected with transportation.
3. C Category members - those who have got experience in transport industry except
A and B as specified above.
4 jy Category Members,. Banks and other institutions who assist the cooperative
may be entitled to become the members under this category.
5. E Category Members are only nominal members, i.e. the persons who deal with
the cooperative. They cannot become any officer of the society. They are not entitled to
get share in the profit or to have voting rights.
The authorised capital of society had been fixed at Rs. 19 lakhs divided into five
categories of shares. They are shown in the Table 4.1.
As a first step, the workers pooled their compensation amount of 4.85 lakhs and invested
it during 1991. The fund increased to Rs. 5 lakhs by 31-3-1992. During the year 1992,
there were only 126 members and they belonged to category A, B, and C only.
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In addition to the share capital, the society borrowed a sum of Rs.6.34 lakhs from Banks
and other financial institutions to run the operations during the year 1991-92.
A, B, C and D Class members. The Managing Committee meets once in a month. Now
conductors, three from repair and other maintenance staff and three belonging to
once in every three years. Once the elections are over, the members of the managing
committee decide on the Chairman and the Vice-chairman of the society. The term of
office of the chairman and Vice-chairman shall be coterminous with the term for which
Managing Committee
In order to manage the day today affairs of the society, the society is also authorised by
and three other directors. Subject to the terms and conditions stated in the by-laws, the
Managing Committee can exercise powers and take decisions on the following.
3. Initiate any punitive action for alleged misbehaviour, impose any fine, and
suspend any worker or initiate any other disciplinary action.
The administration of the society has been decentralised by opening various sections and
running of these sections has been entrusted to efficient officials. The amendment of
on 27-2-2001 enabled them to appoint Managing Director to look after the day today
coordinating the activities of all the departments. It is expected that while designing
these sections, due care is bestowed to ensure that work groups consisting of people with
common tasks are brought together so that they could achieve better goal orientation.
The structure is also expected to ensure division of labour, specialisation, and greater
efficiency. When an organisation grows, diversifies into different activities, adopts newer
keep phase with the pace of development. In the absence of such changes, the structure
itself could become the major hurdle for growth of the organisation. The following are
1. Personnel Section
This section looks after the selection, service conditions, training and various grievances
connected with employees as per section 17(1) and 18(A) of the Cooperative Societies
allowances, leave facilities, bonus, provident fund, any other statutory facilities, etc., are
Some of the specific tasks of this section are verification of daily bus collection of
different routes, sorting of the different bundles of tickets, comparing the duplicate tickets
with gate pass, preparation of collection slips, entering distance covered each day by
3. Accounts Section
This section is concerned with the verification of documents coming from gate pass
section, entering in the concerned register and reporting of any omission on the part of
4. Transport Section
This section is the backbone of the TCS. This section is concerned with the completion
of work as per Motor Vehicles Act 1948, payment of taxes on vehicle, obtaining Fitment
obtain new routes and taking part in the meeting organised by Regional Transport
Authority.
5. Traffic Section
Running of buses as per schedule in the fixed routes, is one of the important
responsibilities of this section. The important tasks of this section include completion of
duty allocation, running of busses according to the time fixed by Regional Transport
attendance of drivers and conductors and initiating steps to repair buses held up in the
6. Checking Section
Detection and elimination of frauds, allocation of responsibility, etc., are some of the
tasks entrusted to this section. Some of the important responsibilities of this section
include, supervising the work rendered by all TTE's, registering their attendance
allocation of routes to TTE' reporting to the higher authorities about the dereliction of duty
by drivers and conductors and repeated teeming and lading of any nature.
7. Mechanical Section
This section is required to repair all the vehicles belonging to the society. The major
duties of this section are sending of mechanics to the spot on receipt of information about
from conductors and drivers about the condition of buses and to repair accordingly.
8. Stores Section:
This section is required to store and provide necessary spares and equipments for
different buses of the unit like required tires, diesel and oil etc. The important duties
include- preparation of indent for the procurement of different spares required by buses
after obtaining permission from secretary, entering of detailed report pertaining to tyres,
total K.M. run, particulars like tire number, manufacturer, year, model etc., in the Tire
History Card, entering of daily diesel slips. Approved brands of oil, lubricants and grease
should be procured and details as regards their purchases and consumption have to be
The heads of respective sections are held directly responsible for any lapses. Each
It is observed that the drivers and conductors constitute the integral aspect of any
transport unit. The success of transport unit, to a greater extent, depends upon them.
members, as they are pivotal to transport unit. In order to accommodate booking agents
and other office workers C category has been created. Banks and other institutions
Sympathisers and those who deal with cooperative, such as tyre dealers, vehicle dealers
etc, are not left out, but included under E category members. It also helps in the capital
finance. The most important principles in this respect are limited return on capital, and
restricted to workers only. Hence, they have to rely on loans or credit, which sometimes
The TCS has adopted, more or less, the management structure of the old firm. The study
revealed that, although founder members were able to help define managerial
Cooperative Society. The involvement of workers in participatory forum has not been
achieved to the fullest extent due to lack of training. Though the issue of training was
their employment intact. The efforts made by workers in running the society were
applauded at various levels. The present position of the Society is the result of the
Recruitment
It may be recalled that TCS was started with a workforce of 126 employees for the unit.
The society had recruited a total of 284 employees by the end of the tenth year. Out of
We have seen that membership rights are not automatically conferred on every worker.
all those employees who joined the society at its inception were granted membership.
Before granting membership to new workers, the Society wants to make sure that they
will act responsibly within the cooperative. In this case, the length of time to become
members is not formalised. Probably, the existing members might not wish to see their
profit share diluted. So, membership can still be an important and sometimes contentious
issue.
Service Conditions
The cooperative has developed well-set service conditions, categorising various wage
scales under different grades. These wage scales are given in the following table:
Table 4. 2. Grade and Category-wise Wages (TCS)
Total Salary Salary Difference
Number of 1991 2001
Workers Rs Rs Rs
DRIVER 42 1,991.00 4,870.00 2,879.00
CONDUCTOR 35 961.00 3,638.00 2,677,00
MECHANIC 26 1,300.00 4,703.00 3,403.00
OFFICE 19 1,256.00 4,734.00 3,478.00
CHECKING 17 1,031.00 4,180.00 3,149.00
WATCHMEN 03 700.00 2,707.00 2,007.00
Source: Office Records of the Society.
It is clear from the above table that there has been considerable increase in the salary of
workers during the period of six years. Compared to others, the founder members got
more benefit.
Bata
The Bata'9 payable to all drivers, conductors and T.T.C's are as follows:
The Bata starts from a minimum of Rs.15 for 75 kilometres or less than 75 kilometres.
Additional one rupee per eveiy additional 15 kilometres, up to a maximum of Rs.38 for
With the relentless efforts of the employees, who built the society from scratch and are
now on the board of management too, the society's annual transactions have crossed
Rs.6.37 crores. While fleet strength has touched 60, from only five during 1991, the
number of employees has gone up to 284. The hard work and determination in
developing this organisation has started paying dividend to worker and to the community
at large.
The backward 'Malnad' regions owe a lot to TCS. But when the society was established
ten years ago, nobody imagined that it would be a success. With its impressive
performance, the society managed to get a grant of Rs. 1 lakh, from the State
Government in 1993-94. The Government of Karnataka gives this grant to the best
cooperative societies of Karnataka. This daring attempt by the workers to shape their
own destiny also enabled them to be classified as 'A' grade Cooperative Society from
The present position of the Society may be well understood through the data presented in
Table 4.3.
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The constant efforts of employees are responsible for increasing the society's annual
turnover, which increased from 50.46 lakhs in 1991-92 to 6.37 crores in 1999-2000.
Barring the year 1991-92, the society earned net profit in all the years. The net profit of
the society reached Rs.3.40 lakhs, Rs.1.12 lakhs, Rs.1.73 lakhs, 2.95 lakhs, 1.92 lakhs,
2.19 lakhs and 9.89 lakhs during the years 1993-94, 1994-95, 1995-96, 1996-97,
In addition to good salary, the following benefits have been given to members and
As a result of the above and other statutory benefits, all the workers have got a sense of
belonging to this society. Every year 3,000 students who commute in these buses avail
50 percent concession on the daily fere. The society, according to its Managing Director,
looses nearly Rs. 10 lakhs due to social benefit. In spite of all these commitments, the
society has been making profits, developing its operations and fleet strength.
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extent. Initially, by using the worn out spare parts of the buses, the society intends to set
card are establishment of tyre retreading unit, workers quarters, automobile spare parts
shop, body building unit, petrol bunk, service station etc. The construction work of office
building, a workshop and service station is already completed in the newly acquired land
transportation business. It has proved that ordinary workers are capable of solving
complex managerial problems through collective action. The factors that stand out as
The first concerns the characteristics of the work force. The efforts of a cohesive
homogeneous group of skilled workers of TCS are responsible for reducing the number
committed to both social and commercial objectives and which effectively balances short
The third factor is the existence of effective and continuing external support. Local
bodies, Government departments, students, etc, - have lent their moral and technical
from Indian Coffee Board. Indian Coffee House (ICH) has branches in six states and two
union territories within India. The employees Cooperative Society of the Indian Coffee
Board runs Indian Coffee House. Nearly 4818 employees are working in the 158
branches of Indian Coffee House all over the country. Out of this, 63 of these branches
operate in Kerala. All over the country, Indian Coffee House is run in the same style and
Formerly, Indian coffee was almost entirely exported. Very little was consumed within
the country. The export market completely collapsed on account of the II World War.
The coffee planters panicked. The only way out was to popularise coffee within the
country. The British opened Coffee Houses all over the country in order to encourage the
beverage among the natives. That's how the first Coffee Houses were established in
Bombay and Hyderabad during the year 1936. The Indian Coffee Promotion Board was
established in 1940, which was reconstituted in 1944 as Indian Coffee Board. By 1948,
there were 48 coffee houses, one coffee van, three depots which together employed 1500
employees. The coffee house employees did not have any justifiable scale of pay. After
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working long hours, they often had to do odd jobs for the top officers of the Board, said
were dismissed.
In 1956, the Plantation Enquiry Commission report recommended the closing down of
all the coffee houses and retrenching all employees. The commission said that the
but could not prevail upon the government to revoke the decision. He suggested that the
1958, the first Coffee Board Workers Cooperative Society was registered at Bangalore.
It was Mr NS Parameswaran Pillai who led the movement in Kerala. Two units were
registered in Trissur and Talassery in 1958. Two units were necessary because rules that
apply to cooperatives were not uniform within the state of Kerala. During the year 1972
The Kannur Unit of Indian Coffee House runs 13 coffee houses in seven districts from
Palakad to Kasaragod.
Federation Limited coordinates all the ICH across India. In the wake of the formation of
Coffee Workers Cooperative Societies in most of the Indian States by the ex-employees
of the Coffee Board, it was of common interest and a matter of necessity to organize an
All-India Body to co-ordinate the activates of the Coffee Workers Societies and also to
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formulate a joint committee to voice the problems faced by them. It is hoped that the
federation will tackle problems common to all societies and the it could also serve as a
common forum where representatives from all the primary societies could meet,
exchange views and learn from each others experiences. The Federation also supplies
raw coffee seeds to the member societies. It plays a vital role in the Coffee Worker
cooperatives movement at the national level. Table 4.5 shows details of Indian coffee
The above table shows that Indian Coffee Houses affiliated to the federation are scattered
in different parts of the country. The Trissur unit is having the maximum number of
workers. The Federation is directly running one coffee house, which is situated at
Maulanal Azad Medical College, New Delhi. There are many concrete programmes and
member societies strengthen the hands of the Federation to combat the common
attention on Kannur Unit of Indian Coffee House. The Kannur unit of Indian Coffee
House was established during the year 1958 with the following objectives (Bye law of
ICH, Kannur).
2. To give employment opportunities to those workers who had been laid off from
the Indian Coffee Board in hotel and other allied industries.
5. To assist the workers of Indian Coffee House through bulk purchases of their
requirements and providing them the required quantity of such goods.
6. To run the agency of coffee board and to negotiate with the Government.
The managing committee of the society has got nine members, eight from the workers
and one from the sympathizers. Government is not having any representation in the
managing committee. Election is held once in every three years. The last election was
held on 24-01-1999.
branches. They are located at (1) N. H. Road, Taliparamba, (2) South Bazar, Kannur, (3)
Plaza Tourist Home, Kannur, (4) Fort Road, Kannur, (5) Court Road, Talessery, (6)
Mysore Road, Manathavadi, (7) Mavoor Road, Calicut - 4, (8) Aradhana Tourist Home,
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Calicut, (9) Palayam Road, Calicut - 1, (10) Palayam, Calicut, (11) College Road,
The administration of the society has been decentralised. Every unit is required to
submit its accounts to the head office regularly. The manager and accountant are
responsible for the smooth running of the branches. They have got various rights like
accounts of branches. The organisational structure of the sample unit is given in the
following chart.
IndianCoffeeWorkersCooperativeSocietyLimited
Organisational Structure
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economic benefits to its worker members. The society has already constructed its
administrative office at Kannur at a cost of Rs 9 lakhs and started operating from the
newly constructed office. It has taken all the positive measures for the consolidation and
strengthening of its branches and at the same time new branches are also being started. It
has initiated measures to start a new branch at Malappuram, where there is no branch at
present.
Recruitment
All recruitment is at the level of general worker. Higher posts are always filled by
promotion and not by direct appointment. Fresh recruitment is made from dependents
and friends of existing permanent employees. The general worker is on training for one
and a half years. He has to work in all areas and gain experience. He is finally placed in a
The minimum qualification for the post of worker is seventh standard and good
personality. If an employee completes SSLC, the society recommends and sends him for
training, such employees will be promoted to clerical category. At the time of joining all
the employees are required to purchase at least 100 shares of the society at Rs. 10 each.
overtime wages of Rs. 9 per hour. The cooperative has also developed well-set service
conditions, categorising various wage scales under different grades. These wage scales
Dearness Allowance
All workmen get 229 per cent DA apart from other allowances. All the scales are
The present position of the society can be understood from the table given below:
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For the year 1999-2000, the society registered an average monthly turnover of
Rs. 60 lakhs.
The management works on the principle of instilling faith and cooperation among the
employees. The general body consisting of all permanent employees make up the
general body through secret ballot, once in two years. Political parties do not play a role
All coffeehouses maintain a uniform standard. Some things never change. The dawn of
the day, the sequence of the seasons and perhaps the Indian Coffee House. The aroma,
the ambience and the furniture present a truly nostalgic picture. Incidentally, the old
timers say that even the photographs on the wall have remained the same. Mahatma
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Gandhi, a cup of fresh brewing coffee and a photograph of an old time actress from
down South, Ragini, continue to adorn the walls. One has to only enter the Coffee House
to feel the still lurking presence of its past glory. The spare walls, old but sturdy furniture
and the reeking smell of coffee compliment the historical lineage of the place, a glaring
contrast to the Coffee Shops in five-star hotels that are gaining momentum today. The
youth may have shifted their loyalties to the fast food joints but the diehard loyalists still
refuse to hear a word against their all time favourite joint. The menu consists of Dosa,
Idli, Vada, Sandwiches, Porota, Cutlets and the rest. But what stands out is that true to its
name, the Coffee House offers a wide choice where coffee is concerned. Cold coffee,
cold cream coffee, hot cream coffee, tray coffee - its all there.
employees themselves offer to buy it themselves. The coffeehouses work for sixteen
hours a day form 6 in the morning to 9 in the evening. Coffeehouses are closed for only
two days in a year. On Thiru Onam day and AKGs death anniversary day.
All promotions are time bound. Time bound promotion helps to develop a sense of
The management believes in providing benefits to the employees rather than maximising
net profits. All permanent employees, more or less, are on the same scale of pay. There
are several allowances (such as medical, festival, uniform, tour etc,) and a handsome
bonus (2.4 months salary) besides retirement benefits. Gratuity, pensioners benefits and
leave etc. are generous. The various benefits given to the workers of Indian Coffee
The current crisis in increased rate of cooking gas etc has burdened the coffee house
The turnover of the various branches for the past three years are given below:
The turnover of most of the branches have been increasing, which can be seen from the
above table. It registered a percentage of increase of 20.83 during the year 1998-99 and
place: the Kerala Dinesh Beedi Workers Cooperative. Kerala Dinesh Beedi Workers
beedi workers deserted by Private Beedi Industrialists. Its origin can be traced to Kerala
Employment) Act of 1968. The Act conferred many benefits like Sunday wages, annual
leave, provident fund and medical leave to the workers. During October 1968, the labour
unions demanded the implementation of provisions in the Act. This legislation stipulated
Kerala such as Ganesh Beedi, Bharath Beedi, Durbar Beedi and PVS Beedi, who had
their factory units in the Kannur District for over 50 years, abruptly closed down their
factories and left the state. As a result more than 12,000 workers, who were employed in
an industry till the previous day, lost their jobs and they were thrown out to the street.
These workers know nothing except rolling of beedies. It was not practicable to
rehabilitate them in other fields. The sudden unemployment of workers created a lot of
socio economic problem in the District. Government and leaders in the public life tried
its level best to bring back the beedi management back. They even promised that the
provisions of the Act would be implemented only slowly in a phased programme. But all
the attempts failed since the management was very adamant. We could not trace in the
history of our country any other instance where 12,000 workers working in a particular
under cooperative field. The Government took all the trade unions into confidence.
A series of meetings with the trade union leaders were held at Kannur for about a
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fortnight. Finally, the scheme was to organize twenty primaiy societies in a very
dispersed manner throughout the district to have easy access to workers. The Minister of
Industries and the Minister of Labour of the State took personal interest in organizing the
unit. The workers were enrolled as members in the Primary Cooperative Societies and 20
Primary Societies (Now 22) constituted the central society The central society has been
entrusted with the responsibility of mobilizing the finance, making bulk purchase of raw
materials of Tendu leaves, beedi tobacco, labels etc., and advance them to the primaries.
The member workers at the primaries are required to make beedies and those primaries
should sell the beedies to the central society at the agreed price after adjusting the
advance received.
The central society and the primaries were to have nominated Board of Directors apart
from elected directors. Various trade unions like CITU, AITUC, INTUC, STUs, etc, got
due representatives based on their strength. The Government of Kerala appointed Junior
officer of Industries Department was deputed as secretary of the central society. Initially
Sri. G. S. Panicker, IAS, was appointed as chairman of the society. He was the guiding
force of the Dinesh Beedi for 28 years and associated himself with it till his death.
As the unemployed workers had no money to contribute towards share capital, the
Government decided that each worker needs to raise only Rs. 1. 00 and the balance
amount of Rs. 19.00 per share would be advanced by the Government as the share capital
loan, to make up one share of Rs. 20.00. The Government contributed Rs. 1.35 million
towards the share capital of Kerala Dinesh Beedi Cooperative (KDBC) and sanctioned
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an initial loan of Rs. 0.71 million to the central society with a view to have ways and
means to purchase some raw materials and towards wages. Thus, the whole programme
Dinesh Beedi was to function on a commercial basis for the development, production
and marketing of the beedies produced by member societies. To accomplish this, KDBC
supplies raw materials, provides working capital, arranges for sale of finished products,
supervises the work of member societies and undertakes research in beedi production.
KDBs 30,000 workers own and manage the society themselves with a small
with a central management cooperative. Workers directly elect one representative from
each production cooperative to the General Body, which elects five of the seven directors
of the central cooperative. Elections are held every two years and only KDB workers can
own shares and every worker must own at least one share. All five current worker elected
directors are experienced stop-floor beedi rollers and union activists. The State
1. Purchase of Raw Materials: The raw materials required for the making of beedies
are tendu leaves. The leaves are usually purchased from Forest Corporations of
Orissa, Andhra Pradesh and Marketing Federation of Madhya Pradesh States.
Tobacco is bought from private traders of Gujarat and Karnataka States
3. Price Fixation: KDBC works out the market price for beedies by taking the value of
raw materials, wages, margin given to primaries and administrative expenses of
KDBC. The selling price of beedies is decided by the KDBC Board taking into
consideration the market price. The KDBC has unofficially assumed the role of price
leader in the regional market.
maintain the accounts. The production is organised under the factory system in order to
ensure the quality of their product. The primary society appoints supervisors at each
centre to look after manufacturing operations and to ensure quality. Each day a worker is
issued a kilo of tendu leaves and tobacco. At the end of the day, the beedies are collected
and recorded. Drying, packing, and labelling are done in the factory premises. Each
packet will carry the registration number of the respective primary and the common trade
of Kerala sanctioned a working Capital loan of Rs. 7.1 lakhs and stood guarantee for a
cash credit facility of Rs. 20 lakhs with the State Cooperative Bank. The working capital
loan due to government was repaid long back. Now the society flourishes on its own
finance. Thrift collection of five paise per rupee the workers earned from the very
inception resulted in getting Rs. 200 lakhs, which is now being utilized as the life blood
of this endeavour.
The present position of the Society may be well understood through the data presented in
Table 4.10.
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The society has implemented various unique benefit schemes to help the social and
According to this scheme Re. 1 per month was collected from the employees and from
this fund a lump sum of Rs. 4,000 was paid to those who retire from service on attaining
Functioning of Dinesh Beedi has made tremendous impact of this industry in Kerala and
also in the neighbouring States of Tamil Nadu and Karnataka. Kannur District had been
notorious for labour unrest for beedi industry. However, ever since the establishment of
Kerala Dinesh Beedi, labour unrest in the beedi industry has become a story of the past
with cement backrests. Their work sites are clean and recently painted, fluorescent
lamps light the work area fairly well, and they have more free space to move around
without bumping neighbour workers. Just outside the work shed are sanitary, water
sealed latrines. At the end of the day, KDB workers can wash up at faucets located at the
work sites, cleaning themselves of the smell of tobacco and putting on fresh clothes to
greet their children in. The children go to school, not expected to assist beedi rollers.
Thus, KDB is one of the largest worker-owned cooperatives in the world. KDB drew on
the skills and commitment of the radical workers culture of the region to survive as a
business with its primary commitments being the welfare of its workers and the
generation of employment and income for the community (Franke, 1977). For years it
has paid the highest wages and benefits to its worker-owners. But KDB did more than
survive: it grew and prospered despite fierce competition from the private sector. KDB
did this under worker ownership and worker-elected management. There are two
interesting features of worker activity and mobilisation during this period of growth.
First, there were several unions among beedi workers with different political affiliations.
When KDB was formed, it brought together workers from different unions, and the
success of KDB showed that union differences could be overcome to achieve a concrete
developmental task: team spirit and worker solidarity were stronger than political rivalry.
Secondly, pressure from beedi workers, led by A.K. Gopalan, the leader of the
Communist Party of India (Marxist) group in the Lok Sabha, brought about the
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enactment of a national law for the protection of cigar and beedi workers in 1966
KDB has survived several Governments and economic ups and downs, and today is
software development to respond to declining tobacco sales. The objective being creation
of fresh job avenues, KDB has adopted only intermediate technologies that are labour-
intensive, according to the society Chairman, Mr. C.V. Kunhiraman. The cooperative has
Thiruvananthapuram for the supply of technical know how and machinery for coconut
cream manufacture and also for initial project monitoring. The technology for pickle
making has been supplied by the Central Food Technology Research Institute (CFTRI),
Mysore.
Though Kerala Dinesh Beedi has since then remained one of the most efficient
cooperatives in the State, the beedi industry as a whole was on the decline. Not only
Dinesh Beedi, but also all the units in the beedi industry were facing a crisis, reflected in
the significant drop in sales. Between 1993- 94 and 1996-97 the sales of KDB recorded a
drop from 67 million numbers to 65.5 millions, 63.2 millions and 56.9 millions. The net
profit of KDB has gone up almost steadily in all but four years since its inception, rising
from Rs. 50,000 in 1968-69 to Rs. 3.15 lakhs in 1984-85. But of late, the situation has
changed with the sales turnover declining from Rs. 71.45 crores in 1993-94 to Rs. 71.07
Apart from the campaign against smoking as one factor that brought the industry to its
present plight, the other two causes according to its Chairman, are: first the policy of the
Central Government, that it promoted, on the one hand, mini cigarettes and, on the other,
of mini cigarettes, including those from tobacco majors, have penetrated the market,
assisted by concessions in the Central Excise Duty structure since the 1994- 95 Budget.
But the mini cigarette manufacturers often used inferior quality paper and tobacco so as
to sell the products at around 20 paise per stick. Again, while the Dinesh Beedi
cooperative, which paid its members one of the highest wages in the industry, incurred a
cost of production of 14-15 paise per beedi, the unorganised, home-based manufacturers'
production cost came only to around 7-8 paise per beedi. If the coconut cream and pickle
products from cashew apple, prawns, mussels etc. that were readily available in the
northern districts. The cooperative has also thought of entering into mushroom
cultivation.
A major element in KDB's success has been the creation of both representative
democracy in the election of managers and participatory democracy on the shop floor
culminating in the social and economic development of workers. The shop floor
KDB was not an official New Democratic Initiative, but its long-term success inspired
theoretical predictions that worker ownership leads to a rapid dispersal of the surplus, a
consequent lack of investment capital, and a short-term management orientation, KDBs
worker directors have kept the cooperative in profit in all but 4 of its 28 years of
existence. If ordinary workers in one of the most exploited industries of India could
and if they could maintain their creation for more than two decades, surely local-level
democracy is possible.
These samples from the private sector were selected keeping in view of nature of
business of worker cooperatives. Brief overviews of these private sector units are made
here.
Company (Private) Limited (HTC) was established in the year 1930. It came into
existence when the transport service was still in infancy. The registered office of the
company is situated in Udupi. The first managing director of the company was
The HTC was a partnership firm to begin with and later it was converted into a private
limited company. The company used to run buses not only in Dakshina Kannada district,
but also in North Kanara, Shimoga and even in some towns in Kerala beyond Kasaragod.
It has many firsts to its credit like introduction of minibuses for short routes as well as a
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range of Super Express buses interconnecting towns of Dakshina Kannada District and
thus indirectly providing the much needed infrastructure to many intervening small
villages. It has four branches situated in Mangalore, Shimoga, Karkala and Kundapur
In accordance with the provisions of Indian Companies Act of 1913, which was then
prevailing Act, this company was established with limited liability. At he beginning, the
share capital of the company was Rs. 1,00,000 divided into 1,000 shares of Rs. 100 each.
At present the authorised capital of the company is Rs, 50,00,000. The issued, subscribed
and paid up capital of the company is Rs. 41,30,000 divided into 41,300 shares of
Rs. 100 each. The company is also a partner in M/s Super Treads and
M/s H. G. Automobiles.
From the last five years, the company has been incurring losses. Managing Director felt
that the conditions in the passenger transport area have turned unfavourable due to bad
road conditions and all round increase in the operational costs without corresponding
increase in the ticket fares and on account of severe competitions caused by large-scale
limited period of 12 years, it has succeeded in capturing a good business, looks after
catering requirements of all major institutions of Mangalore. It has got a staff strength of
Janatha Deluxe Refreshments was started by Sri. Pathumudi Sooryanarayana Rao during
the year 1990. Today, JDR is considered a landmark not only to the people of
Mangalore, but for others who are on the lookout for something special to take back
home. This hotel is a vegetarian restaurant serving North Indian dishes also.
The success of JDR is phenomenal for all to see. This hotel is making profits and paying
income taxes. During the financial year 1999-2000, JDR made a profit of Rs. 4,49,132.
During the year 2001, JDR constructed a marriage hall with an expenditure of
Rs. 1.25 crores. The proprietor feels that the onus goes to the hard work put in by the
management down to the staff Another important reason for their success is that it is
Mangalore Ganesh Beedi. 501 Ganesh beedies are hand rolled in tendu leaf and
then dried in chambers warmed by a charcoal fire. The details of this process are a
carefully guarded secret and have been perfected over three generations. Every thing
from the rolling of the beedies to packing the cartons is done by hand.
The distinct flavour and taste have led Ganesh Beedies to become one of the worlds
most popular brands of beedies. With annual sales exceeding 20 billion beedies, the
beedies are very popular in the United States of America, Germany, France, Switzerland,
the Caribbean (West Indies), Singapore, the Middle East, and Australia.
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Mangalore Ganesh Beedi Works was founded by late B. Raghurama Prabhu and late
B. Madhava Shenoi. The Firm has prospered over the years reaching an opportunity to
more than 1,50,000 people, mainly, in rural areas of South India. The main office of the
firm is situated at Vinoba Road, Mysore and having branches at many places spread over
the nation.
Mangalore Ganesh Beedies is the largest selling brand in India, accounting for around
30% of the beedies produced in the organised sector. The company emphasizes quality.
Since its inception the company has got wide appreciation from the beedi smokers for
A well-organised system exists for the marketing and distribution of beedies to different
parts of the Country. There are around 300 major distributors spread over the length and
breadth of the country. These distributors are supplied with beedies from the nearest
branch of the Firm on advise from the Head Office. The details of sales during the last 10
Mangalore Ganesh Beedi Works has a network of 30 branches spread over Karnataka
and Tamil Nadu. Out of the 30 branches, 20 are located at various places in Karnataka