Decided on May 13,1965


Cited Judgements :-



Satish Chandra, J. - (1.)THIS is a petition under Article 226 of the Constitution. It prays for an order in the nature of certiorari to quash the notifications dated 28th January 1959 and 24th August 1969 made under Section 3. U. P. Industrial Disputes Act. 1947.
(2.)THE petitioner is a company which carries on the business of manufacture and sale of sugar by its vacuum pan sugar factory situate in Iqbalpur, district Saharanpur, By the impugned orders the petitioner company has been directed to pay a sum of Rupees 1,09,000/- as bonus to its workmen for the crushing season 1957-58.
The question of payment of bonus to workmen of vacuum pan sugar factories had been agitating the management of various sugar factories in the State of Uttar Pradesh, their workmen and the State Government. For several years prior to 1957-68 the question of bonus was referred for consideration to State Tripartite Conference (Sugar) This Conference consisted of representatives of the management of various sugar factories, of the workmen and of the State Government. Such a State Tripartite Conference was held on June 28, 1958 to consider the question of bonus for the year 1957-58. The Conference recommended that an ad-hoc committee for formulating principles for payment of bonus for this year be set up. The State Government accepted the recommendations of the Conference and by a notification dated 8th August 1958 appointed a committee to investigate and report to the Government on the question of payment of bonus for workers of Vacuum Pan Sugar Factories of the State for the crushing season 1957-58, within three months.

This committee consisted of the Labour Commissioner, Uttar Pradesh and six other gentlemen, out of those three were representatives of the employers and three of the workmen. This committee was successful in evolving an agreed basis for the payment of bonus. It recommended that a sum of Rs. 56,00,000/- be paid as bonus to the workers of sugar factories in the entire State and that the amounts of bonus payable by each factory shall be worked out by the Indian Sugar Mills Association, U. P. Branch in consultation with the Labour Commissioner, U. P. The Indian Sugar Mills Association recommended that the share payable by the petitioner company be determined as Rs. 1,09,000/-. The Labour Commissioner agreed with this and forwarded the recommendation to the State Government.

(3.)THE State Government considered the report of the committee and the recommendation made by the Indian Sugar Mills Association and the Labour Commissioner, and ultimately by a notification dated 28th January, 1959 passed an order under Section 3, U. P. Industrial Disputes Act directing the payment of bonus for the crushing season 1957-58. THE petitioner company was directed to pay a sum of Rs. 1,09,000/-. This order appointed a sub-committee consisting of the Labour Commissioner as Chairman and one representative of the workmen and one representative of the employer to examine and recommend to the Government the cases of factories claiming exemption from payment of the bonus. THE factories were permitted to claim exemptions on the ground that they had suffered losses or made such meagre profits during the year 1957-58 as to make it unreasonable for them to pay the amount of bonus mentioned in this order. Accordingly, the petitioner company made a claim for exemption by its letter dated 9-2-1959 on the ground that it had suffered a loss of Rs. 3,94,863. 41 nP. for the period ending 30th June 1968. THE sub-committee heard the petitioner on its claim and in its report dated 28- 5-1959 made to the Government it repelled the petitioner company's claim. Ultimately, by an order published in the Government Gazette dated 24-8-1959 the State Government passed an order under Section 3, U. P. Industrial Disputes Act directing the petitioner company to pay a sum of Rupees 1,09,000/- as bonus.
The two orders dated 28-1-1959 and 24-8-1959 passed under Section 3 of the Industrial Disputes Act have been challenged on various grounds mentioned in the petition. Sri Jagdish Swarup, learned counsel for the petitioner, stated that those grounds can no longer be pressed in view of the decision of the Supreme Court reported in State of Uttar Pradesh v. Basti Sugar Mills Co. Ltd. AIR 1961 SC 420 wherein the Supreme Court upheld the validity of a similar order passed in 1950. But learned counsel urged that in view of the change in the provisions, one point arises; and that is that Section 3 Clause (b) of the U. P. Industrial Disputes Act is void as it infringes Article 14 of the Constitution.


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