Decided on January 25,1967

HARI RAM Appellant


MODI (Actg), C. J. - (1.) THIS is a group of 16 writ applications challenging the validity of Notification No. F. (12) Lab. /63, dated the 31st July, 1965 (Ex. 3) published in the Rajasthan Gazette Extraordinary dated the 31st July, 1965, having been issued by the Rajasthan State under the Minimum Wages Act (No. 11) of 1948, hereinafter called the Act, purporting to revise the minimum rates of wages foployees employed in the Mica Mines throughout the State of Rajasthan in accordance with the schedule given thereunder. THIS notification, as stated therein, was made under sec. 3 read with sub-sec. (2) of sec. 5 of the Act by the respondent State in pursuance of notification No. LWI (1) 2 (20) 58, dated the 27th June, 1960 of the Ministry of Labour and Employment of the Government of India by which the President of India acting under Art. 258 (1) of the Constitution had delegated to the State Government functions of the Central Government to review and revise the minimum rates of wages for employees employed in mica mines situated in this State. The several petitioners in these writ petitions are employers engaged in the business of mica mining, that is, the manufacture and sale thereof in thtn this State.
(2.) THE material facts leading up to these writ applications may shortly be stated as follows. To start with, the respondent State had fixed minimum wages for workmen employed in mica mines throughout Rajasthan by a notification dated the 29th March, 1952. This notification came to be challenged before this Court in Civil Writ Petition No. 58 of 1955 (N. K. Jain vs. THE Labour Commissioner, Rajasthan), and by its decision dated the 27th August, 1956, which is reported as ILR (1957) VII Rajasthan 74, that notification was held to be invalid inasmuch as the committee which was appointed by the State under sec. 5 (1) of the Act to advise it in the matter of the fixation of the rates in question had not been lawfully composed in accordance with certain essential requirements of sec. 9 of the Act, and consequently the notification of 1952 was struck down. I shall have occasion to refer to this case at some length hereafter. Thereafter, by another notification, dated the 24th April,f 1959, the State again fixed the minimum rate of wages for workmen employed in mica mines in this State (See Ex. 1 ). In the Schedule given under this notification, only one category of worker was specified, namely, an "adult worker", and his minimum wages were fixed at Rs. 1/5/- per day exclusive of weekly days of rest. Then again, by a further notification dated the 31st July, 1965 (Ex, 3) which is now impugned before us, the State Government revised the rates for the class of workmen with which we are concerned throughout the State of Rajasthan under 26 different categories as specified in the Schedule given in the said notification. As a preliminary step to this last-mentioned notification, the State Govt. had on the 17th May, 1962, in the first instance appointed a Committee consisting I of five members, (and it is entirely unnecessary to say anything about its composition as it came to be changed before it started working) to inquire into the conditions prevailing in the employment in mica mines and to advise the State Government in the matter of revision of the rates of wages fixed by the last-mentioned notification dated the 24th April, 1959. This notification was, however, superseded by another notification dated the 26th November, 1952, by which although the total membership was maintained as before, its personnel was almost wholly changed except with respect to one of its members who happened to be a representative of the employers, and it was ordered to consist of two representatives of the employers as well as two of the employees, and Professor K. S. Mathur, Head of Department of Economics Degree Classes, Government College, Ajmer, was appointed an independent member and its chairman and a serious dispute has been raised before us about its composition with which we shall deal at its proper place. This committee submitted its report to the Government who, it was admitted during the course of arguments before us, referred it for further advice to the Advisory Board constituted under sec. 9 of the Act. It was also admitted that this Advisory Board in the first instance appointed a Sub Committee to go into and further consider the report of the wages committee, which sub-committee consisted of Shri T. C. Jain, Dy. Labour Commissioner being a member of the Advisory Board, but its remaining three members were not members of the Board at all. One of these Shri S. C. Mathur, M. P. , Bhilwara, was a member of the wages committee and another member thereof Shri U. S. Bhatnagar, Labour Officer, Bhilwara, was a non-member secretary of that Committee but was likewise not a member of the Advisory Board, and the remain-ing member Shri S. K. Sharma, mining Engineer, Bhilwara was also not a member of the Advisory Board nor was he in any manner connected with the primary committee. This sub-committee, in its turn, submitted its report to the Advisory Board which is Ex. 6 making certain changes in the structure of wages recommended by the wages committee. The matter thus came up before the Advisory Board which consisted of 21 members in all, eight of whom were employers' representatives and a like number as employees' representatives, and the remaining five were all Government Officers appointed as independent members, one of whom belonged to the department of Industries and Supplies and the remaining four were officers connected with the Labour Department and one out of these latter being the Secretary of the Labour Department in the State Government was nominated as its Chairman in his capacity as an independent member. The Board, then, as it says in its proceedings of the 7th May, 1965 (Ex. 8), considered the recommendations of the wages-committee and the sub-committee and submitted its report, and the wage-structure recommended by it is contained in Ex. 8 wherein it suggested an alternative scale of minimum wages according as the linking of dearness allowance with the consu-mer-price-indices was to be accepted by the State Government or not. The Govt. , however, seems to have accepted the wage structure recommended by the Board on the without-linking basis as an all inclusive minimum rate of wages per month for the various categories of workmen mentioned in the schedule given under that notification Ex. 3 which is now impugned before us as illegal and inoperative in law. In enforcement of the said Government notification, certain claims were in the normal course of things filed by the Labour Enforcement Officer before the Assistant Labour Commissioner, Kotah, against some of the petitioners, and consequently, proceedings came to be commenced before that Officer against some of them under sec. 20 of the Act, and it is contended that these proceedings are also, illegal because the notification Ex. 3 is itself illegal. It is in these circumstances, prayed by the petitioners that this Court be pleased to issue a writ or order quashing the notification Ex. 3 as illegal and inoperative and a further writ, order or direction be also issued declaring that all proceedings taken in consequence of the said notification do stand quashed and that the respondent State and the other three respondents namely the Regional Labour Commissioner, the Labour Enforcement Officer, Bhilwara, and the Assistant Labour Commissioner Kotah be restrained from taking any proceedings whatever hereafter in pursuance of the said notification. These applications have been opposed by the State. Now the principal grounds which have been pressed before us to assail the notification in question on behalf of the petitioners may be summarised as follows - (1) Although notification No. 3 was issued by the State purporting to revise the wages of workmen in mica mines, it was really not a notification revising the wages but it really fixed them for the first time for the various kinds of workmen mentioned in the notification. This, it was contended, the State had no jurisdiction to do, as authority had been delegated to it by the President acting under Art. 250 of the Constitution by the notification dated the 27th June, 1960, referred to above, merely to revise and review the minimum rates of wages for such employees, but authority to fix wages for the first time had never been delegated to it, and consequently the notification No. 3 is wholly invalid and inoperative. (2) The procedure followed in fixing the rates was and is grossly defective in the following vital aspects: (i) the Wages Committee as finally appointed under sec. 9 of the Act must have consisted of an equal number of the representatives of employers and of employees, and, apart from them, must have consisted at least of one independent person as chairman thereof. But the appointment of Shri S. C. Mathur as a representative of the employers thereon, it was strongly contended, was wholly illegal as he was not an employer at all nor an owner of mica mines nor was he interested in the mica mines industry at the relevant time, nor had he been ever selected by the employers as their representative. Secondly, the appointment of Professor K. S. Mathur who was the Head of the Department of Economics Degree Classes, Government College, Ajmer, as the Chairman was also vehemently challenged to be illegal as he being a Government Officer could not be said to be an independent person. The composition of this Committee was, therefore wholly vitiated according to sec. 9. (ii) Again, there was and is no order of the Government appointing the bub-Committee which sat in judgment on the wage-proposals made by the Wages Committee, and, therefore, it was a wholly unauthorised body. Even assuming, as contended for by the respondent State, that the Sub-Committee" was appointed by the Advisory Board to assist it in the formulation of these proposals, it was urged that this body must have consisted of some out of the members of the Advisory Board itself. It was not constituted, and, on the other hand, it was composed of outsiders with the exception of only one member namely Shri T. C. Jain who was Deputy Labour Commissioner. Inasmuch as the Advisory Board was obviously influenced by the recommendations of this Sub-committee, the former had acted with grave irregularity and impropriety, and consequently its deliberations were fundamentally vitiated. (iii) Furthermore, the constitution of the Advisory Board was, it was argued, also vitiated, because it had no independent member at all inasmuch as the persons who were appointed to function as "independent members" thereof were all government officials mostly connected with the department of labour who could not be expected to be unbiased in the matter of fixation of wages for labourers and, in any case, could not be expected to act independently of the policy of the Government in this matter, and further the appointment of the Secretary to the Government in the Labour Department of the State as Chairman of this Board as an independent person was wholly misconceived as he could not by any means be accepted as "independent" in the very nature of things, and consequently the constitution and composition of the Advisory Board was entirely illegal and the decision of the Government based on the recommendations of such a body could not but be tainted with illegality. (3) Lastly, it was urged that the rates fixed by the Government on the recommendations of the Advisory Board vide notification No. 3 were so high that the industry could not afford to shoulder the burden thereof, and it was urged in this connection that the authorities concerned should have taken into consideration the capacity of the industry to pay the rates which were fixed under the notification, and in having not taken this factor into consideration in the fixation of minimum wages, the wage-structure recommended by all these bodies including the Advisory Board was bad and deserves to be set aside. All these contentions have been opposed by the State, and I now propose to deal with each one of them in the order in which I have set them out above. Taking up the first contention first, I am not quite sure that this was not a case of revision of rates of minimum wages within the meaning of the Act as there was an earlier notification of 1959 Ex. 1 fixing the rates of wages of workmen in this industry (See notification dated 24th April, 1959, in this connection ). Now it is true that under that notification minimum wages were fixed in a somewhat rough and ready fashion as for an adult worker on a certain wage, and a further detailed division or classification of the various categories of workers was not thought fit to be made at that time. Even so, what was done subsequently may conceivably and by no means improperly be considered as revision. But assuming though not accepting that it was not a revision as such, but was an initial fixation of minimum wages for such work, our attention has been invited to the notification of the Government of India No. 374 dated 21st February, 1952 published in the Gazette of India dated March 1, 1952, at page 345 thereof. This notification reads as follows: "in exercise of the powers conferred by cl. (1) of Article 258 of the Consititution, the President hereby entrusts to the Government of Rajasthan with their consent the functions of the Central Government under the Minimun Wages Act 1948 (XI of 1958) in so far as such functions relate to the fixation of minimum rates of wages payable to employees in mica mines and in stone and marble quaries situated in the State of Rajasthan and to the appointment of claims officers under sec. 20 of the said Act to hear and decide all claims arising out of payment of less than the minimum rate of wages to the said employees. " By a subsequent notification dated the 27th June, 1960, published in the Gazette of India dated the 2nd July, 1960, Part II page 192, the Government of India made it clear that notwithstanding the entrustment to the State Government with the functions of the Government of India relating to the fixation of minimum rates of wages and the review and revision thereof for employees employed in the mica mines situated within the Rajasthan State, among certain other States with which we are not concerned, the Central Government may itself exercise such functions either generally or in any particular case or class of cases. It is no body's case that the Central Government has taken any action in pursuance of this subsequent notification and fixed minimum rates of wages for workmen employed in the mica mines. The notification only made it clear that the Central Government also retained in tact its own power to fix minimum wages in this behalf if it so considered fit, in spite of the entrustment made in this connection to the State, but, in the absence of that Government embarking upon such a step, the State Government certainly appears to me to have the authority to not only review and revise mini- mum wages fixed for workmen in the industry in question but also to fix them in the very first instance. The State Government was, therefore, perfectly within its authority even to fix the rates of minimum wages for this class of workmen under Sec. 3 of the Act, and consequently I over-rule the petitioner' objection on this score as wholly untenable. This brings us to the second head of objections under which the composition of the Wages Committee (apart from the sub-committee) and the Advisory Board have been hotly assailed before us. The principal objection raised as regards the composition of these bodies is that they were vitiated because of the Government officers having been appointed as independent members and/or as Chairman thereof. Now so far as this contention is concerned, I confess that the point is not free from a certain amount of doubt or difficulty. This question has engaged the consideration of some of the High Courts in our country and has unfortunately been the subject of a sharp cleavage of judicial opinion. The first case in this connection to which our attention has been invited is Jaswant Rai vs. State of Punjab (1 ). There the Punjab Government appointed a Wages Committee under Sec. 9 of the Act and one Mr. Oak who was the Labour Commissioner in that State was appointed as its Chairman. It was contended that his appointment as an independent person on the committee and its Chairman was illegal. This objection was, however, repelled by a learned single Judge of the Punjab High Court, holding that it was not laid down anywhere in the Act that an official of the Government could not be nominated as a member of the Committee or that only a non-official could be considered to be an independent person, and further that an independent person in the given content meant a person who was neither an employer nor an employee in the particular employment for which minimum wages were required to be fixed implying thereby that a Government officer would not fall within either of these categories.
(3.) ON a like question having arisen before the Madhya Pradesh High Court in Narottamdass vs. P. B. Gowarikar (2), a division bench of that Court dissented from the Punjab view. Dixit C. J. speaking for the court laid down that "independent persons" as used in Sec. 9 connoted persons who were independent not only of the employers and of the employees but also of the State Government. The learned Chief Justice was of the view that the Government were not absolutely dis-interested in a matter like this particularly when it controlled or ran a scheduled employment' or employments. Reference was also made in support of this argument to Articles 42 and 43 of the Constitution which expressly enjoined inter alia that the State shall make provision for securing just and humane conditions of work and that it shall endeavour to secure by suitable legislation or economic organisation or any other way a living wage ensuring a decent standard of life and full enjoyment of leisure, social and cultural opportunities and, therefore felt persuaded to hold that the State was actively interested in wage-earners and in the matter of fixation of minimum wages in any scheduled employment. The learned Chief Justice also took note of the fact that a Government servant's freedom of action and thought was limited by the fact that he was always likely to be influenced by the policy of the Government. For these reasons, the bench held that the appointment of an official as the chairman of the Board was wholly illegal, and from this the further conclusion was drawn that if the board was not validly constituted, then it did not exist in law and that any consultation with such a Board would not be a valid consultation contemplated under the proviso to sub-sec. (2) of Sec. 5. The next case is D. M. M. Rao vs. State of Kerala (3 ). In this case, the Chairman of the Wages Committee was a professor in a certain college and as such an officer of the Government, and his appointment as Chairman of the Committee treating him as an independent person was assailed. A learned single Judge of the Kerala High Court who disposed of this case more or less preferred the view of the Punjab High Court to that of the Madhya Pradesh. The view taken in this case, put succinctly, is that the true meaning of the expression "independent person" as used in sec. 9 of the Act must be taken to be that such a person should be one who has nothing to do with the employers or employees in the scheduled employment in question. But where the State itself was not connected with the employers and the employees therein, there can be no valid objection to the appointment of such a person as chairman. In coming to this conclusion, the learned Judge also took into consideration the definition of the expression "independent person" in clause (i) of Sec. 2 of the Industrial Disputes Act (which is to the effect that - "a person shall be deemed to be independent' for the purpose of his appointment as the Chairman or other member of a Board, Court or Tribunal, if he is unconnected with the industrial dispute referred to such Board, Court or Tribunal or with any industry directly affected by such dispute: Provided that no person shall cease to be independent by reason only of the fact that he is a share-holder of an incorporated company which is connected with, or likely to be affected by such industrial dispute; but in such a case, he shall disclose to the appropriate Government the nature and extent of the shares held by him in such company. " though he himself was cautious enough to make it clear that it would not be strictly proper to accept the test laid down under the Industrial Disputes Act for the purposes of the present Act. The next case is Ramkrishna Ramnath vs. State of Maharashtra (4 ). The appointments of two persons on the Advisory Board, No. 1 Shri P. S. Bakhale being allegedly an official in the employment of the State Government, and No. 2 Shri G. K. Dhutiya also a Government official, being the Assistant Commissioner of Labour, Bombay, as its members were challenged, and on that basis it was contended that the composition of the Board was vitiated. The learned Judges found on facts that Shri Bakhale was not a Government servant at all at the relevant time, and that Shri Dhutiya was merely a Secretary of the Board without being a member of it. These findings would seem to have been sufficient to dispose of the writ application; but the learned Judges further went on to hold that Shri Bakhale or Shri Dhutiya would still be independent as in their view that expression was used in sec. 9 of the Act in contra-distinction with persons representing employers and persons representing employees only and did not exclude Government servants from its true ambit. It further appears that there was an earlier judgment of the Bombay High Court in President, Nagpur Mudrak Sangh vs. State of Bombay (5) which took the same view and which was, therefore, binding on this bench. The learned Judges further went on to hold that even if Shri Bakhale or Shri Dhutiya did not fall within the category of independent persons still that would not vitiate the entire composition of the Board as in their opinion it was an irregularity of more or less a minor character. The next case on the point is Bengal M. P. E. Union vs. Kohinoor Pictures (6) of the Calcutta High Court. The decisions in A. I. R. 1958 Punjab 425 (supra) of the Madhya Pradesh High Court in A. I. R. 1961 M. P. 182 (supra) and that of the Kerala High Court in A. I. R. 1963 Kerala 115 (Supra) appear to have been brought to its notice and the High Court preferred the view of the Kerala High Court to that of the Madhya Pradesh High Court. The learned Chief Justice Bose who delivered the leading judgment in the case held that there could hardly be any room for doubt that persons like the Labour Commissioner or the Deputy Labour Commissioner would be the most suitable persons to be consulted in the matter of fixation of minimum wages under the Act and that the expression "independent" as used in the context of sec. 9 of the Act means a person other than those who are employers and employees in relation to the scheduled employment in respect of which the minimum wages are to be fixed, and, therefore, any person who could not be characterised as an employer or employee of the particular scheduled employment would be an independent person within the meaning of the Act. The learned Chief Justice further held that merely because a person nominated to function as an independent person in the committee was a Government official was no bar to such nomination as there was no indication in the Act that a Government Official was disqualified from functioning as an independent person and further that there was no warrant for any suggestion that the Labour Commissioner would not act in a disinterested manner or that the Government in discharging its duties and functions under the Act in fixing the minimum wages was likely to take sides with the wage-earners or to act in a manner prejudicial to the interest of the employers. In this view of the matter, the learned single Judges finding that the notification of the Government fixing the minimum wages was bad because the constitution of the Advisory Committee was defective, the Labour Commissioner and the Deputy Labour Commissioner being not independent persons within the meaning of sec. 9 of the Act, was held to be erroneous and was set aside. The next and the last but one case to which I should like to refer in this connection is Bansilal vs. State of A. P. (7) of the Andhra Pradesh High Court. In this case, the view taken in 1961 M. P. 182 was followed and the decision of the learned single judge in Kohinoor Pictures (Pvt.) Ltd. vs. State of W. Bengal (8) which was reversed by the division bench in AIR 1958 Pun. 425 & AIR 1963 Kerala 115 was dissented from. This is how the learned Judges summed up their views in this case: "we hold that the view of the Madhya Pradesh High Court in AIR 1961 Madh Pra 182. . . . . . and of the Calcutta High Court in 1961-2 Lab LJ 741. . . . . . . . . . . . is more acceptable and that Government Officials of the executive department, as distinct from officials engaged in judicial work or department, cannot be considered to be 'independent persons' for the purpose of sec. 9 of the Act, even though they are not directly connected with the manufactory in which the wages are to be enquired and reported on by the Committee concerned. We are also in agreement with the view of the Madhya Pradesh and Calcutta High Courts expressed in the above decisions that Government cannot be considered to be absolutely disinterested party in the matter of fixation of minimum wages. " The last case to which we have adverted above but which calls for some more detailed mention is the case of our own Court reported as N. K. Jain vs. Labour Commissioner (9) though the facts there were somewhat different. In that case the composition of the Advisory Committee appointed under sec. 5 (l) (a) of the Act was attacked, among other matters, on the ground that it only consisted of six of its officers and that neither the employers nor the employees in the scheduled employments were represented thereon, and, that being so, it was contended that the committee was not properly constituted as required by law, and the notification issued on the basis of its advice was invalid and inoperative in law. In deciding this case the learned Chief Justice (Wanchoo C. J. speaking for the Court) "assumed" that all the six members appointed to the Committee were independent persons but found that there was no representation of the employers or the employees on the Committee. It was, therefore, held that as there was no representation of the employers or the employees in any of the scheduled employements on the Committee, it was a Committee merely in name and none in reality, and consequently the Government's notification fixing minimum rates of wagers was of no legal force and effect. In coming to this conclusion, the learned Chief Justice relying on the decision of their Lordships of the Supreme Court in Bijay Cotton Mills Ltd. vs. State of Ajmer (10) laid down as follows: "the Supreme Court held the Act valid because of the provision, among others, which required the State Government, infixing minimum wages, to take into account the advice of the Committee or the representations on its proposals. If this provision and similar provisions relating to consultation with advisory bodies had not been made obligatory, the Act would, in all probability, have been struck down. Therefore, obtaining the advice of the committee under sec. 5 (a) or consideration of representations on the proposals of the State Government is the sine qua non of fixation of minimum wages without appointing a committee under sec. (1) (a) for without publishing its proposals and inviting the representation and considering them and further if the State Government were to revise the minimum rates of wages without consultation with advisory bodies provided in other sections of the Act, the notification fixing minimum rates of wages or revising them would in our opinion, be clearly against the basic provisions of the Act, and would have no force and validity. " Earlier in their judgment, the learned Chief Justice referred to another Supreme Court case namely Edward Mills Co. v. State of Ajmer (11) wherein it had been observed with reference to a certain irregularity committed by the State Government in the matter of the extension of the life of the Wages Committee that it was only an advisory body and that the Government was not bound to accept any of its recommendations and so consequential procedural irregularities of that nature could not vitiate the final report which fixed the minimum wages, but distinguished that case and went on to observe that there were irregularities and irregularities and that while some irregularities may not be such as to vitiate the final notification there may be others of a fundamental character which could not but have the effect of vitiating the final order and that it did not follow from the judgment of the Supreme Court in the Edward Mills, case (supra) that irrespective of the nature of the irregularity there could be no vitiation of the final order under any circumstances. This is more or less the entire case law bearing on the point which we are called upon to decide so far as it has been brought to our notice and I have been able to gather myself. And before I proceed to pronounce my own opinion thereon, I would briefly refer to the objective underlying the Act and the provisions relative to the point for determination before us. ;

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