STATE OF UTTAR PRADESH AND OTHERS v. BASTI SUGAR MILLS CO., LTD.
Citation: [1961] 2 S.C.R. 330; 1960 INSC 196
Court: Supreme Court of India
Bench: P.B. GAJENDRAGADKAR , A.K. SARKAR, K. SUBBA RAO, K.N. WANCHOO, J.R. MUDHOLKAR
Judgment date:
Case summary
1960 INSC 196. Supreme Court of India judgment dated 1960-11-11. STATE OF UTTAR PRADESH AND OTHERS v. BASTI SUGAR MILLS CO., LTD. Read the judgment and case...
Judgment text
330 SUPREME COURT REPORTS (1961) law validly made and applicable to a case pending in appeal must be considered and given effect to by the 01n1niss1oner A II C Th I . . ppe ate ourt. e cone us10n we have reached IS that the notification of 1956 was validly made and applies to the present case. In view of this conclusion we have considered it unnecessary to examine the notification of 1953 or the reasons for which the High Court held that notification to be bad. For the reasons given above, we allow this appeal and set aside the judgment and order of the High Court dated February 16, 1954. The question referred to the High Court is answered in favour of the appellant. The appellant has succeeded by reason of the notification of 1956 and taking that circumstance into consideration, we direct that there will be no order for costs for the hearing in this Court. Appeal allowed. STATE OF UTTAR PRADESH AND OTHERS V. BASTI SUGAR MILLS CO. , LTD. (P. B. GAJENDRAGADKAR, A. K.
SARKAR, IC SuBBA RAO, K. N. WANCHOO and J. R. MUDHOLKAR, JJ. } Indt and workmen or both to observe any term or condition of employment for a specified period. Since the law enables the State Government to impose a term it is apparent that the legislature which enacted that law did not import into that word a con-sensual sense. \Ve cannot, therefore, accept the argument that under cl. (b) it was not open to the State Government to make the payment of bonus to workmen a condition of their employment in future and thus augment their past wages. M P h k h c d Others r. at a t en reierre to the following observations in the judgment of Bhargava, J. Mills "Obviously there can be no question of requiring any one to observe for a future period terms and conditions of employment which have already remained effective and have already been carried out by those persons". According to Mr.
Pathak the effect of the order of the Government is to add a new term or a condition with regard to employment for a period which is already over. We would again point ·out that this is not the effect of the order of the Government. The effect of that order is merely to require the employer to pay an additional sum of money to his employees as a term and condition of work in future. Mr. Pathak, however, said that this would involve payment of bonus even to new employees, that is, those who had not participated in earning the profits in the past and that this would be contrary to the very conception of bonus. The answer to that is that under the order of the Government suoh bonus is payable only to those workers who had worked during the years in question and not to new employees.
It is further to be borne in mind that in the dispute in question· the employees were bargaining in their collective capacity and, therefore, the question whether the personnel forming the employees of the factories in July, 1950, when the order was made by the Government, and in the years 1947-48 and 1948-49 to which the dispute relates was the same is quite immaterial. As has been rightly pointed out by Sapru, J. , "The employees might well have taken in the industrial dispute the line that the payment of bonus in respect of the years 1947-48 and 1948-49 to the workmen employed in those years was regarded by those who were employed in future as a preliminary and essential condition for not only the settlement of the industrial dispute in progress but also for carrying on their future work in sugar factories".
We also concur with the observations of the learned judge that by coming to the conclusion that the workers' demand should be conceded the State Government was not passing an orde~ which will h~ve retrospective effect but was passmg an order which was to ensure that the work- Pradesh men tv be employed in the year 1950 would work in a contented manner. It must not be forgot·ten that Basti the dispute was in the present, that is, it existed when the impugned order was ma. de, though its origin was in the past. What the order did was to rasolve that dispute and this it could only do by removing its cause. Mr. Pathak then relied upon the following observations of Bhargava, J. , in L. D. Sugar Mills v. U. P. Government (1): · " The expression ' to observe for such period as may be specified, such terms and condition! '! of employment as may be determined' gives an indication that clause (b) of s. 3 of the U. P.
Industrial Disputes Act, 1947, is meant for the purpose of passing orders by which the Government gives directions a. bout what the terms and condi~ions of employment should be and not how a. particular term and condition of employment already in existence should be acted upon. " Bhargava. , J. 's decision was, however, reversed in Ram Nath Koeri and, . Another v. Lakshmi Devi Sugar Mills and Ors. (~) by a. division benc~ of the Allahabad High Court in Letters Patent Appeal brought against Bhargava. , J. 's decision. We agree with the view taken by the Appellate Bench. In our opinion, therefore, there is nothing in cl. (b) of s. 3 of the Act which prohibited the State Government from making a direction to the sugar factories with regard to the payment of bonus for the years -1947-48 and 1948-49 in their order of July 7, 1950 and that by ma. king such a direction the State Government was not giving a retrospective effect to the provisions of that clause.
In this connection it is relevant to remember that any direction as to payment of bonus must inevitably be based on the available surplus, and such surplus can be determined only at the end of a given year. Therefore, what the impugned order purports to do is to require the employers to pay specified amounts in future, though the said fi b c fi d • Othm amounts are xed y re1erence to the pro ts ma e m the two preceding years. If a direction as to payment Mills of bonus can be issued under s. 3(b) it cannot, therefore, be said to be retrospective. The next argument of Mr. Pathak appears, at first h b h sig t; to e more formidable. He points out t at un-doubtedly an industrial dispute had arisen, and indeed it is upon that basis that the State Government pro-ceeded to appoint a Court of Inquiry. Therefore, according to Mr. Pathak resort could be taken by the State Government only to the special provisions of cl. (d) and not to the more general provisions of cl. (b) of s. 3.
In other words, where there is an industrial dispute, the appropriate thing for the Government to do is to refer it for conciliation or adjudication under the provisions of cl. (d) and not to deal with the matter by an executive order as it has done in this case. Mr. Pathak then refers to a further passage from the judgment of Bhargava, J. , just cited which is as follows : "It appears from the language that this provision was not meant for the purpose of dealing with individual disputes arising out of the application of a term or condition of employment and no power was granted to the State Government under this provision of law, to sit as an adjudicator to decide a dispute that might have arisen relating to the working and actual application of terms and conditions of employment already in force. The provision was for the purpose of enabling the State Government to vary the agreed terms and conditions of employment for purposes specified in s. 3 of U. P.
Industrial Disputes Act, 1947, under the pressing necessities or expediency justifying such course of action. " We entirely agree with Mr. Pathak that the normal way of dealing with an industrial dispute under the Act would be to have it dealt with judicially either by conciliation or by adjudication and that judicial process cannot be circumvented by resort to executive action. The proceeding before a conciliator or an adjudicator is, in a sense, a judicial proceeding because therein both the parties to the dispute would have the opportunity of being heard and of placing the relevant Pradesh material before the conciliator or adjudicator. But there may be an emergency and the Government may Basti have to act promptly "for securing the public safety or convenience or the maintenance of public order or supplies and services essential to the life of the community or maintaining employment. " It was, therefore, necessary to arm it with additional powers for dealing with 1mch an emergency.
Clause (b) of s. 3 was apparently enacted for this purpose. An order made thereunder would be in the nature of a temporary or interim order as would be clear from the words "for such period as may be specified " appearing therein and from the second proviso to s. 3. Under this proviso where an industrial dispute is referred for adjudication under cl. (d) an order made under cl. (l:i) cannot be enforced after the decision of the adjudicating authority is announced by or with the consent of the State Government. It would, therefore, follow from this that where the Gov~rnment has made an executive order, as it did in this case, under cl. (b) of s. 3, it is open to the aggrieved party to move the Government to refer the industrial dispute for conciliation or adjudication under cl. (d) of s. 3. Mr. Pathak, however, stated that under this section, the Government has a discretion whether or not to refer a dispute for conciliation or adjudication under cl. (d).
But in our opinion where once the Government has acted under cl. (b) on the ground that it was in the public interest to do so, it would not be open to the Government to refuse to refer the dispute under cl. (d) for conciliation or adjudica~ion. Mr. C. B. Agarwal, who appeared for the State of Uttar Pradesh conceded, and we think rightly, that this would be so and added that in case the State Government was recalcitrant it could be fprced to do its duty by the issue of a writ of mandamus by the High Court under Art. 226 of the Constitution. There is a further argument of Mr. Pathak which mll8t be noticed and that argument is that ther. e is. (1) A. I. R. 1954 All. 705, 714. (2) (1956) n L. L. J. n. nothing in cl. (b) which limits its operation to an emergency and that. it is, therefore, not open to us to l . h . Othm p ace a construction t ereon of the kmd we are placing. The opening words of s.
3 themselves indicate lfWls that the provisions thereof are to be availed of in an emergency. It is true that even a reference to an arbitrator or a conciliator could be made only if there is an emergency. But then an emergency may be acute. Such an emergency may necessitate the exercise of powers under cl. (b) and a mere resort to those under cl. (d) may be inadequate to meet this situation. Whether to resort to one provision or other must depend upon the subjective satisfaction of the State Government upon which powers to act under s. 3 have been conferred by the legislature. No doubt, this result is arrived at by placing a particular construction on the provisions of that section but we think we are justified in doing so. As Mr.
Pathak himself suggested in the course of his arguments, we must try and construe a statute in such a way, where it is possible to so construe it, as to obviate a conflict between its various provisions and also so as to render the statute or any of its provisions constitutional. By limiting the operation of the provisions of cl. (b) to an emergency we do not think that we are doing violence to the language used by the legislature. Further, assuming that the width of the language could not be limited by construction it can be said that after the coming into force of the Constitution the provisions can, by virtue of Art. 13, have only a limited effect as stated above and to the extent that they are inconsis-tent with the Constitution, they have been rendered void. In our view, therefore, the provisions of cl. (b) of s. 3 are not in any sense alternative to those of cl. (d) and that the former could be availed of by the State Government only in an emergency and as a temporary measure.
The right of the employer or the employee to require the dispute to be referred for conciliation or adjudication would still be there and could be exercised by them by taking appropriate steps. Upon the construction we place on the provisions of cl. (b) of s. 3 it is clear that no question of discrimination at all arises. Similarly the fact that • t k b th G t · act ion was ~ ~n y e overnmen m an emergency Pra! Wh in the pubhc mterest would be a complete answer to the argument that that action is violative of the pro. Basti visions of Art. 19(l)(g). The restriction placed upon the employer by such an order is only a temporary one and having been placed in the public interest would fall under cl. (6) of Art. 19 of the Constitution. Upon this view we hold that the High Court was in error in issuing a writ against the State Government quashing their order in so far as it related to pay- ' ment of bonus. The appeal is allowed and order of the High Court is set a. side.
Costs of this appeal will be paid by the respondents. Appeal allowed. MANOHAR LAL v. THE STATE OF PUNJAB (JAFER IMAM, J. L. KAPUR, K. c. DAS GU. PTA, RAGHUBAR DAYAL and N. RAJAGOPALA AYYANGAR, JJ. ) Trade Employees-Close day-Enactment, if violative of funila-mental rights-Workers' Welfare-Protection-Restriction, if im-reasonable-Punjab Trade Employees Act, z940, (Punj. X of z940) s. 7 (I) The appellant who was a shopkeeper was convicted for the second time by the Additional District Magistrate for contraven-ing the provisions of s. 7(1) of the Punjab Trade Employees Act, 1940, under which he was required to keep his shop closed on the day which he had himself chosen as a "close day ''. He raised the plea that the Act did not apply to his shop as he did not employ any-stranger but that himself alone worked in it and that the application of s. 7(1) to his shop would be· violative of his fundamental rights under Arts.
14, 19(1)(f) and (g) of the Constitution and also that the restriction imposed was not reason-able within Art. xg(6) as it was not in the interest of the general
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