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PETITIONER: THE BIJAY COTTON MILLS LTD.

       Vs.

RESPONDENT: THEIR WORKMEN & ANOTHER

DATE OF JUDGMENT: 12/02/1960

BENCH: GAJENDRAGADKAR, P.B. BENCH: GAJENDRAGADKAR, P.B. GUPTA, K.C. DAS

CITATION:  1960 AIR  692            1960 SCR  (2) 982  CITATOR INFO :  R          1960 SC 812  (5)  APL        1962 SC1263  (9)

ACT:        Industrial  Dispute-Minimum  basic wage fixed  by  Tribunal-        Modification  by  Labour  Appellate  Tribunal  according  to        statutory  notification issued two years after the  award-If        valid--Appropriate Government-Industrial Disputes Act, 1947,        (14 of 1947), lndustrial (Development and Regulations)  Act.        1951 (65 of 1951). S. 2(a)(i).

HEADNOTE: On the refusal of the appellant-employer to fix the  minimum wages and rates for contract work of the workmen-respondents who  alleged  that they were paid below the  level  of  bare subsistance wage, the dispute was referred to the Industrial Tribunal for adjudication.  The first Tribunal could not fix any minimum basic wage and the award of the second  Tribunal which  fixed  a scale was set aside on the ground  that  the appointment  of the Tribunal was not published according  to law.  The third Tribunal ultimately fixed the basic  minimum wage on the industry-cum-region basis after considering  the rates prevalent in various parts of the country and a  place nearest  to the appellant company.  The minimum  awarded  by the Tribunal was slightly increased by the Labour  Appellate Tribunal in accordance with a statutory notification  issued under  ,the Minimum Wages Act, 1948 (XI of 1948), which  had come into force after two years of the award of the Tribunal and by which a scale of minimum wage and dearness  allowance was  fixed.  On appeal by the appellant company  by  special leave. Held, that the Labour Appellate Tribunal committed no  error of  law  in awarding the same minimum basic wage  which  was statutorily  fixed and which came into force only two  years after the award of the Tribunal. In determining the minimum basic wage the fact that a  large amount  of dearness allowance was paid to the  employees  in other  comparable occupations in the same region should  not be ignored. In order that the Central Government might itself become the appropriate  Government within the meaning Of S. 2(a)(i)  of the  Industrial (Development and Regulation) Act, 1951,  (65

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of I 95 1) it must specify in that behalf that the  industry in question was a controlled industry. If  the services of one Tribunal were not available  to  the appropriate  Government it was perfectly competent  to  that Government  to appoint another Tribunal to take up the  work of adjudication.

JUDGMENT:        CIVIL APPELLATE JURISDICTION: Civil Appeal No. 355 of 1958.        Appeal by special leave from the decision dated December 12,        1956, of the Labour Appellate Tribunal              983        of India, Bombay in Appeal (Bom.) Nos. 77and 103  of 1956.        A. V. Viswanatha Sastri, S. N. Andley, J. B. Dadachanji  and        Rameshwar Nath for the appellant.  B.    D.   Sharma,    for        respondent No. 1.        1960. February, 12. The Judgment of the Court was  delivered        by        GAJENDRAGADKAR, J.-The industrial dispute between the  Bijay        Cotton Mills Ltd., (hereinafter called  the  appellant)  and        their workmen (hereinafter called  the  respondents)   which        has given rise to this appeal by  special  leave  has   gone        through  a protracted and tortuous course.  The  respondents        claimed that the    scale  of  minimum wages and  rates  for        contract works      should be fixed for them because it  was        alleged  that the payments made by the appellant were  below        the  level  of the bare subsistence wage. The appellant  did        not  accede to the demand thus made by the respondents,  and        so on December 1, 1950, the-present dispute  was    referred        for  adjudication to the Industrial Tribunal  consisting  of        Mr.  D.  N. Roy, under s. 10(1) read with s.  12(5)  of  the        Industrial Disputes Act, 1947 (Act XIV of 1947) (hereinafter        called  the  Act).  Amongst  the  items  thus  referred  for        adjudication, the first two were (1) that the mill employees        be paid minimum wages and rates for contract works as  shown        in the    two  statements  enclosed, and (2)  that  dearness        allowance  be  paid to all workers at the rate  of.  Rs.  35        permensem  each  and  it  may  be  increased  or   decreased        according  to rise or fall in prices. In the present  appeal        we are concerned with the minimum wages.        It appears that Mr. Roy found himself unable to   fix    any        basic  minimum wage, and to support his view, that it  would        be inexpedient to fix any minimum  basic    wage   in    the        proceedings pending before him, he referred to the fact that        the question of fixation of   the   basic  wage   had   been        rendered enormously difficult by  the  state  of  industrial        development in the State of   Ajmer and by the unsteady  and        frequent fluctuations    in  prices. Even so  be  considered        several  items of dispute referred to him and announced  his        award on  October 5, 1951.             125        984        This  award  was challenged by the  respondents  before  the        Labour Appellate Tribunal.  The appellate tribunal     there        upon remanded the matter to Mr. Roy with a   direction  that        the issues as to the basic wage and as to dearness allowance        should be specifically determined and appropriate directions        issued on those two items.  This remand order was passed  on        October 20, 1952.        By  the  time  the  proceedings were  taken  up  before  the        tribunal on remand, Mr. Roy was not available because he had        ceased  to  be a District Judge in Ajmer. In his  place  Mr.        Sharma  was  appointed.  Mr. Sharma then made his  award  on

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      September 8, 1953.  He fixed Rs. 25 as basic wage and Rs. 10        as  minimum dearness allowance.  It appears that  the  award        thus  made  by  Mr. Sharma was subsequently quashed  on  the        ground  that his appointment had not been duly published  as        required by the Act.  This order was passed on May 25, 1955.        Mr. C. Jacob was then appointed Industrial Tribunal. He made        his  award on January 25, 1956.  By this award Mr. Jacob  in        substance agreed with the view taken by Mr. Sharma and fixed        the basic wage at Rs. 25 per mensem and the minimum dearness        allowance at Rs. 10 per mensem.  This award was directed  to        come into operation as from December 1, 1950. This award was        again  challenged before the Labour Appellate  Tribunal  and        the  appellate  tribunal  has  partly  allowed  the   appeal        preferred  by the respondents and increased the  basic  wage        from Rs. 25 per mensem to Rs. 30 per mensem.  The amount  of        the  minimum dearness allowance has been affirmed at Rs.  10        permensem.   This  decision was announced by  the  appellate        tribunal on December 12, 1956.  It is this decision that has        given rise to the present appeal by special leave.        It is common ground that a Statutory Committee was appointed        under Minimum Wages Act, 1948 (Act XI of 1948) in respect of        Ajmer  on  January 17, 1952.  Its report  was  submitted  on        October 4, 1952, and a notification was issued in  pursuance        of  the said report on’ October 7, 1952.  This  notification        has come into force as from January 8, 1953, and in                               985        consequence  the basic minimum wage is now statutorily fixed        at  Rs. 30 per mensem and dearness allowance at Rs.  26  per        mensem.   Thus it would be   clear that there  is no dispute        between the parties as  to what would be the basic wage  and        the  minimum  dearness allowance subsequent  to  January  8,        1953.        It  appears that Mr. Jacob who fixed the basic minimum  wage        at Rs. 25 per mensem relied upon the fact that the said rate        represented  the  basic minimum wage  on  the  industry-cum-        region  basis.  He has observed that the basic minimum  wage        of  an unskilled worker in the textile mills in  Bombay  was        Rs. 30 per mensem, while at other places it varies from  Rs.        22  to Rs. 30 per mensem.  Then he has also referred to  the        two   charts,  Exhibits  4-A  and  4-B,  produced   by   the        respondents  where  the minimum basic wages  were  shown  to        range  between Rs. 21 to Rs. 30 in Rajasthan.  According  to        him, in Rajasthan minimum basic wages were Rs. 26 per mensem        and  in Beawar which is the nearest centre  from  Bijaynagar        the  minimum wages for an unskilled textile worker  in  1950        were  Rs.  25  per mensem.  That is one fact  on  which  the        tribunal  relied.   The  other fact on  which  reliance  was        placed  was that there was an agreement between the  parties        in  December 1949, under which the respondents were  willing        to  work on the minimum wage of Rs. 27.  In fact it  appears        that  both the appellant and the respondents had moved  this        Court for striking down the notification issued by the Ajmer        Government by which the basic wage had been fixed at Rs.  30        from  January  8, 1953.  In Bijay Cotton Mills Ltd.  v.  The        State of Ajmer (1) it was urged on their behalf jointly that        the relevant provisions of the Minimum Wages Act were  ultra        vires and that it would be in the interests of the  employer        and  the  employees  as well to  strike  down  the  impugned        notification.   This Court rejected the said contention  and        upheld  the  validity  of’  the  Act  as  well  as  of   the        notification.   That,  however,  is  another  matter.    The        agreement on which the respondents were prepared to work for        the  appellant  was pressed into service  by  the  appellant        before the tribunal.  The tribunal was        (1)  [1955]1 S.C.R. 752.

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      986             influenced  by  that fact in  finally  determining  the        amount of basic wage.  Two other facts may also have   weighed.        The appellant started its textile business in 940 and had to        face  a  serious calamity in 1943, as a result of  which  it        suffered  great loss and incurred liability to the  tune  of        nearly  rupees thirty lakhs.  Besides, it was  urged  before        the  tribunal  that  a  large  section  of  the  respondents        belonged  to the agricultural class and they can  supplement        their income from agricultural sources.  It is presumably on        these grounds that Mr. Jacob fixed the basic wage at Rs.  25        per mensem.          The Labour Appellate Tribunal, on the other hand, has held        that, in the absence of satisfactory evidence on the record,        the  statutory notification issued under the  Minimum  Wages        Act  affords  " the best and safest guide in the  matter  of        fixation of minimum wage ". It has observed that even though        the notification can have no application prior to January 8,        1953, still " they were of opinion that the scales of  wages        fixed  thereunder should not be departed from even  for  the        period  now in question.  That was all the more  so  because        not  much  useful material was available on  the  record  to        fix  .  the  said  wage ". It is on  this  ground  that  the        appellate tribunal has increased the basic wage from Rs.  25        to  Rs.  30 as prescribed by the notification.  It  is  this        modification  that  is  challenged before us by  Mr.  A.  V.        Viswanatha Sastri on behalf of the appellant.        Mr. Sastri contends that the method adopted by the  tribunal        was  a scientific method; it took into account a basic  wage        deducible  on the industry-cum-region basis and this  should        not  have  been  reversed by the  appellate  tribunal.   It,        however, appears that in ascertaining the wages which labour        in comparable trades was getting in the relevant region, the        tribunal  has  completely  lost sight of the  fact  that  in        addition  to  the basic wages of Rs. 26/- Rs. 43/-  was  the        average  minimum dearness allowance paid to the workers  and        that  made a very large difference in the total earnings  of        the workmen.  In determining the minimum basic wage the fact        that a large amount of dearness allowance was being paid  to        employees in        987        other  comparable occupations in the same region should  not        have been ignored by the tribunal, and that is one infirmity        on which the appellate tribunal was entitled to comment.        Besides, if the appellate tribunal thought that more  useful        assistance  can be derived from the statutory    fixation of        the minimum wage in Ajmer under the Minimum Wages Act, we do        not  see  how  we can interfere with the said  view  in  the        present  appeal.   It would not be wrong to assume,  as  the        appellate  tribunal did, that in fixing the minimum wage  in        the  area, the Statutory Committee took  into  consideration        all  the  relevant factors and came to the  conclusion  that        that  would  be a fair minimum to prescribe.  On  the  other        hand,  before the tribunal much relevant or useful  evidence        was not adduced, and so the appellate tribunal could not  be        said  to  have committed any error of law in  preferring  to        rely on the statutory notification rather than on the  other        -unsatisfactory  evidence produced in the case.  After  all,        from January 8, 1953, the minimum basic wage was statutorily        fixed, and so, if for a couple of years before that date the        same  basic  wage was awarded by the appellate  tribunal  it        cannot  be  said that any error of law has  been  committed,        which  should be corrected by us in our  jurisdiction  under        Art.  136  of  the  Constitution.   Therefore,  we  are  not        satisfied  that any case for interference has been made  out

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      by the appellant on this point.        The  next  contention  raised  by Mr.  Sastri  is  that  the        appointment  of Mr. Jacob who made his award on January  25,        1956,  was  invalid, and Mr. Sastri suggests that  the  said        award  as  well as the decision of  the  appellate  tribunal        should  be set aside and the matter should be sent  back  to        Mr.  Sharma  for  disposal  in  accordance  with  law.   The        argument  is  that Mr. Sharma’s  appointment  as  Industrial        Tribunal  made on December 31, 1954, was subsisting  at  the        time  when Mr. Jacob was appointed on June 17, 1955, and  it        is  urged that when the same industrial dispute had  already        been  referred  to Mr. Sharma, it was not competent  to  the        appropriate  authority  to  refer the same  dispute  to  Mr.        Jacob.   In support of this argument reliance is  placed  on        the decision of this Court in The        988             State  of  Bihar v. D. N. Ganguly & Ors  (1).   In  our        opinion  there  is  no  substance  in  this  argument.   The        notification on which the whole of the argument is     based        was  issued  on December 31, 1954, for the sole  purpose  of        correcting the error which had crept into    the appointment        of  Mr.  Sharma  by  reason of the  fact  that  his  earlier        appointment made on May 4, 1953, had not been duly published        and notified as required by the Act.  Indeed, it was because        of  this  infirmity  that the award made by  Mr.  Sharma  on        September  8,  1953, had been quashed on May 25,  1955.   In        reading  the later notification this fact must be  borne  in        mind.   No doubt the notification’ purports to refer to  Mr.        Sharma  for his adjudication the matter referred to  him  by        the  Labour  Appellate  Tribunal  on  remand;  it,  however,        appears as pointed out by the appellate tribunal that at the        time  when  the proceedings after the remand  commenced  Mr.        Sharma’s  services were not available, as he was  apparently        not  in the service of the State, and it was  impossible  to        refer  the matter to him for his adjudication.  That is  the        finding  made by the appellate tribunal and this finding  is        fully  justified.   Therefore, since Mr.  Sharma’s  services        were  not  available to the appropriate  Government  it  was        perfectly  competent to the said Government to fill  in  the        vacancy  and appoint Mr. Jacob in his place to take  up  the        work  of adjudication.  Therefore, there is no substance  in        the contention that the decision of Mr. Jacob is invalid  in        law.        The  last contention urged is that the reference is  invalid        inasmuch  as  the  Chief  Commissioner  of  Ajmer  was   not        competent  to  refer the present  dispute  for  adjudication        under s. 10(1) read with s. 12(5) of the Act.  The  argument        is that the Textile Industry has been included at serial No.        23 in the First Schedule to the Industrial (Development  and        Regulation) Act, 1951 (Act 65 of 1951) and as such the Chief        Commissioner  of  Ajmer was not the  appropriate  Government        under  s. 2(a)(i) of the Act.  It is urged that the  present        dispute could have been validly referred for adjudication to        the  industrial  tribunal only by  the  Central  Government.        Section 2(a)(i) inter alia defines the        (1)  [1939] S.C.R. 1191.        989        appropriate  Government  as  meaning,  in  relation  to  any        industrial dispute concerning any industry carried on by  or        under  the  authority  of the Central  Government  or  by  a        railway  company or concerning any such controlled  industry        as   may  be  specified  in  this  behalf  by  the   Central        Government,  the  Central  Government.   The  question which        arises  is:  has  the textile  industry  been  specified  as        controlled industry in this behalf by the Central Government

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      ? It is true that the textile industry is controlled by  the        provision,,,,  of  Act 65 of 1951 and in that  sense  it  is        controlled industry; but that would not be enough to attract        the application of s. 2(a)(i) of the Act.  What this  latter        provision  requires  is  that the  Central  Government  must        specify " in this behalf " that the industry in question  is        a  controlled  industry ; in other words  the  specification        must be made by the Central Government by reference to,  and        for the purpose of, the provisions of the Act in order  that        the  Central  Government may itself become  the  appropriate        Government  qua such industry under s, 2(a)(i) of  the  Act.        It is conceded by Mr. Sastri that no such specification  has        been  made by the Central Government.  Indeed, we  ought  to        add in fairness to Mr. Sastri that he did not very seriously        press this point.           The  result  is the appeal fails and  is  dismissed  with        costs.                                           Appeal dismissed.