judgement:
ivil Appeal No.2560 of 1988.
From the Judgment and Order dated 12.1.1988 of the Madhya Pradesh High Court in Misc.
No. 685 of 1987.
AND Civil Appeal No. 1639 of 1988.
From the Judgment and Order dated 8.6.1987 of the Madhya Pradesh High Court in Misc.
Petition No. 1488 of 1987.
G.L. Sanghi, M.N. Krishmani, Diwan Balak Ram and R.K. Singh for the Appellant in C.A. No. 2560 of 1988.
Rajender Sachar, Sanjay Sareen, Vivek Gambhir, S.K. Gambhir for the Appellant in C.A. No. 1639 of 1988.
Ashwani Kumar, T.C. Sharma and S.N. Khare for the Respondents.
The Judgment of the Court was delivered by SEN, J.
These two appeals by special leave brought from the judgments and orders of the Madhya Pradesh High Court dated June 8, 1987 and January 12, 1988 dismissing the writ PG NO 284 petitions filed by each of the appellants, substantially involve a question as to the interpretation of Rule 10 of the Madhya Pradesh Selection for Post Graduation Course (Clinical, Para clinical and Non clinical Courses) in Medical Colleges of Madhya Pradesh Rules, 1984 ( 'Rules ' for short).
The question raised is one of moment as it involves the right to admission to a seat in the Post Graduate course in Medicine & Surgery in a Medical college (hereinafter referred to as the PG course in MD/MS) falling vacant 'in the midst of ', or 'towards the end of ', an academic year which, we believe, is a problem facing all the States.
First the facts.
In these cases, the facts are not in dispute.
In Dr. Ajay Pradhan 's case, for the academic year 1986 87 commencing from September 1986, there were nine seats reserved for the post graduate course in the clinical subject of General Medicine for the G.R. Medical College, Gwalior.
All the nine seats were filled by the Dean, Medical College from amongst candidates strictly on the basis of merit i.e. by candidates placed at serial Nos. 1 to 9 on the recommendation of the College and Hospital Council.
The appellant Dr. Ajay Pradhan who was placed at serial No. 15 obviously could not be given admission to the P.G. course in M.D. in General Medicine and was instead placed at serial No. 6 in the waiting list.
Later on, he was given admission to the Diploma course in Radiology on 4. 10.86 and he duly joined that course on 6.10.96 but failed to appear at the examination.
On 11.7.87 Dr. Arun Yadav, one Of the Selected candidates, who stood first in the merit list and was admitted to the P.G. course in M.D. in General Medicine met with a tragic death in a road accident.
Inasmuch as his death occurred towards the end of the academic year, the authorities took no steps to fill up the seat.
However, on the death of Dr. Arun Yadav, the appellant staked a claim to fill up the vacant seat under r. 10 of the Rules on the ground that the candidates placed above him in the merit list had been rendered ineligible having either opted for the Diploma course in Radiology or had left their house job.
That claim of his having been turned down he moved the Gwalior Bench of the High Court under article 226 of the Constitution.
A Division Bench of the High Court by its order dated January 12, 1988 dismissed the writ petition holding that the claim of the appellant in terms of r. 10 was misconceived.
The facts in Dr. Sanjay Kumar Shrivastava 's case are these.
For the academic year 1986 87 commencing from August 1986, there were five seats reserved for the P.G. course in M.S. in Obstetrics and Gynaecology for the Medical College, Jabalpur.
On March 2, 1987, the State Government passed an PG NO 285 order transferring the seat occupied by Dr. Smt.
Dhurupkar in Obstetrics and Gynaecology from the Medical College, Jabalpur to Medical College, Bhopal with a view to accommodate her and presumably because such transfer involved financial implications.
On her transfer to Medical College, Bhopal, Dr. Smt.
Dhurupkar continued to draw her stipend of Rs.800 per month reserved against one of the five seats in that discipline for Medical College, Jabalpur.
The appellant Dr. Sanjay Kumar Shrivastava, who was placed at Serial No. 7 in the waiting list moved the authorities seeking admission to the P.G. course in Obstetrics and Gynaecology in Medical College, Jabalpur contending that the seat had fallen vacant because of the transfer of Dr. Smt.
Dhurupkar and had therefore become available in terms of r. 10 of the Rules.
The authorities having disallowed his claim, the appellant moved the High Court by a petition under article 226 of the Constitution.
The High Court by its order dated June 8, l987 dismissed the writ petition in limine holding that 'the seat occupied by Dr. Smt.
Dhurupkar had been transferred with her and hence the same, in fact, was not available.
The main question that falls for determination in these appeals is whether in terms of r. 10 of the Rules there is a right to admission to a seat in the PG course in MD/MS falling vacant in a medical college 'in the midst of ' or 'towards the end of ' an academic year to which it pertains.
A further question arises in one of these appeals as to whether the State Government has the power to transfer a seat in any of the disciplines in the PG course in MD/MS reserved for a medical college to another medical college in the State in order to accommodate a particular post graduate student.
The Medical Council of India constituted under the and one of whose duties is to prescribe the minimum standards of medical education, made recommendations on February 12/13, 1971 prescribing uniform standards for post graduate medical education throughout India which having been approved by the Government of India and as revised from time to time, have the status of Regulations under section 33 of the Act.
The Regulations framed by the Medical Council of India provide inter alia for the different specialities for which PG courses in MD/MS as also Diploma courses in certain disciplines may be conducted, and the norms for admission of students to the PG courses in MD/MS as also to the Diploma courses.
According to the Regulations framed by the Medical Council of India, the student teacher ratio for the PG course in MD/MS is to be maintained at 1:1.
The relevant regulation prescribing a student teacher ratio at 1:1 for PG NO 286 the PG course in MD/MS made with a view to maintain the minimum standards of medical education for the PG course in MD/MS insorfar as relevant, is as follows: "General (1) For M.D./M.S. degree in clinical subjects, there shall be proper training in basic medical sciences related to the disciplines concerned as well as paper in these subjects at the examination.
In the case of M.D. & M.S. in basic medical sciences there should be training in applied aspect of the subject and a paper on the subject.
(2) In all post graduate courses, whether clinical or basic medical sciences, preventive and social aspects should be emphasised.
(3) This should be a part of the examination in the degree courses as this gives training in research methodology.
(4) The student teacher ratio should be such that the number of post graduate teachers to the number of post graduate students admitted per year be maintained at 1:1.
For the proper training of the post graduate students, there should be a limit to the number of student admitted per year.
For this purpose every unit should consist of atleast 3 full time post graduate teachers and can admit not more than 3 students for post graduate teachers in the unit is more than three then the number of students can be increased proportionately.
For this purpose one student should associate with one post graduate teacher.
(5) The selection of post graduates both for degree and diploma courses should be strictly on the basis of academic merit." In most of the States rules have been framed by the various State Governments under article 162 of the Constitution regulating the manner of admission of students to the PG course of studies in MD/MS in the medical college in the State.
The number of seats available for the PG courses in PG NO 287 MD/MS and for the Diploma courses in various disciplines is therefore limited.
There cannot be increase in the number of seats without the sanction of the Medical Council of India and without corresponding increase in the strength of the teaching staff, which necessarily involves financial implications.
The whole controversy turns on the purport and effect of r. 10 of the Rules prescribing the manner in which seats available in any particular year are to be filed, and is in these terms: "10.
The seats available in any particular year will be filled up in that year.
No candidates will be admitted against the seats remaining vacant from previous year.
" We must interpret r. 10 by the written text.
If the precise words used are plain and unambiguous, we are bound to construe than in their ordinary sense and give them full effect.
The argument of inconvenience and hardship is a dangerous one and is only admissible in construction where the meaning of the statute is obscure and there are alternative methods of construction.
Where the language is explicit its consequences are for Parliament, and not for the Courts, to consider.
"Where the language of an Act is clear and explicit", said Viscount Simon in King Emperor vs Bensari Lal Sarma, LR (1945) 72 Ia 57 at p. 70, "we must give effect to it whatever may be the consequences for in that case the words of the statute speak the intention of the legislature".
We do not see why the same rule of construction should not apply to the Rules framed by the State Governments under article 162 of the Constitution.
On a plain construction, r. 10 is in two parts.
The power to admit a student under the first part arises when a seat falls vacant in a particular year.
The words 'filled up in that year ' necessarily qualify the preceding words 'the seats available in any particular year '.
It must logically follow that a necessary concomitant of the power under the first part of r. 10 is the 'availability ' of the seat being filled up in the academic year to which it pertains.
The words 'filled up in that year 'which follow clearly imply that the vacancy cannot be carried over to the next academic year or years.
That construction of ours is reinforced by the second part of r. 10 which, by the use of negative language, clearly creates a bar against the seat being filled up in the next or succeeding academic year.
What is implicit in the first part of r. 10 is made explicit in the second part.
The use of the negative words in the second part 'No candidates will be admitted . etc. ' are clearly PG NO 288 prohibitory in nature and exclude the applicability of the carry for ward rule.
It follows that if a seat falls vacant for any reason, namely, that the candidte selected in order of merit does not join the PG course in MD MS in a medical college or by reason of his death or otherwise, and due to inaction on the part of the authorities the seat is not filled up in the academic year to which it pertains, there is no question of the vacancy being carried forward to the next academic year.
Rule 10 is a specific provision made for the benefit of the merit candidates who are placed in the waiting list.
Normally, the question" of a seat being filled up must arise at the commencement of the academic year or soon thereafter.
In our considered opinion on the terms of r. 10 as it exists, no other view is possible.
When a seat falls vacant in any particular academic year there is a corresponding duty cast on the authorities to take immediate steps to fill up the same.
There is no question of a right of admission to a seat falling vacant in the midst of, or towards the end of, the academic year.
As per the Regulations framed by the Medical Council of India, the PG course in MD/MS is a three years ' course including one year 's house job.
This is followed by a two years ' degree course.
The two years ' degree course in a medical college as prescribed by the Medical Council of India is a period of intensive training.
A post graduate student has not only to write a dissertation or thesis under the supervision of the Professor or Associate Professor who is his guide, but has also to take part in seminars, group discussions, clinical meetings besides attending classes.
There is also emphasis on in service training and not on didactic lectures.
The in service training requires the student to be a resident in the campus and he has the graded responsibility in the management and treatment of patients entrusted to his care.
For this purpose, adequate number of posts of clinical residents or tutors are created.
The period also includes adequate training in the basic sciences of Anatomy, Physiology, Bio Chemistry, Bio Physics.
Pharmacology and Pathology in all aspects relevant to the speciality concerned.
He is also required to participate in the teaching and training programmes of under graduate students or interns in their subjects.
The examination for the PG course in MD/MS consists of (i) thesis or dissertation, (ii) written papers.
(iii) clinical, oral and practical examination.
There are four theory papers for the post graduate degree examination, of which one has to be on Applied Basic Sciences.
The clinical examination is aimed at eliciting the knowledge of the student to undertake independent work as a Specialist.
The oral and practical examinations are meant to test his knowledge on PG NO 289 investigative procedures, techniques and other aspects of the speciality.
The syllabus prescribed by the Medical Council of India for the PG course in MD/MS as also the student teacher ratio of 1:1 virtually negate the right to admission to a seat falling vacant in the midst of or towards the end of the academic year to which it pertains.
In Ajay Pradhan 's case, the High Court dismissed the writ petition principally on the ground that in terms of r. 10 of the Rules he was not entitled to any relief.
Dr. T.N. Singh, J. speaking for himself and Ram Murti Rastogi, J. construed the words 'filled up in that year ' in r. 10 as meaning that a vacancy in any particular academic year must be filled up in that year.
According to him, the power to admit a student under r. 10 must be availed of either before the academic year commences or very soon thereafter, so that a candidate placed in the waiting list admitted under r. 10 does not suffer serious loss of study due to belated admission.
Further he rightly observes, the second part of r. 10 mandates that if any seat has not been filled up in the academic year to which it pertains, the exercise cannot be undertaken in the succeeding year and it furnishes the rationale behind the provision, and said: "An academic course cannot be compressed to accommodate any particular candidate who comes late.
Because, no separate or 'special ' arrangement can be made for a latecomer for imparting instructions to him.
Any other view would not make a reasonable reading or construction of the Rule in its context and setting for each candidate has to be not only examined periodically with respect to instructions imparted, the pre requisite therefore has also to be fulfilled by rendering instructions to him during the whole period of the course.
We have no doubt that when a seat is allotted a date has to be specified by which it has to be availed.
Therefore, it shall not be deemed 'filled up ' if it is not availed.
Indeed, it would then become the duty of the concerned authority to fill up the same by offering it to any other eligible candidate according to merit.
In such a case, a decision has obviously to be taken to do so either before the session commences or very soon thereafter so that the new comer does not suffer serious loss of studies due to belated admission.
" We are in complete agreement with the view expressed by the learned Judge.
PG NO 290 We shall now deal with a couple of decisions to which we were referred to by learned counsel for the appellants during the course of their arguments.
It was submitted that the High Court has consistently been taking a view that it has the power as well as the duty to issue an appropriate writ, direction or order for the 'backlog ' of seats to be filled up whenever it finds that the authorities have acted in violation of the norms prescribed by the relevant rules and a deserving candidate has been wrongly denied admission to such a professional course of studies.
It seemingly appears to be so, but on closer scrutiny the decisions relied upon are clearly distinguishable on facts.
There are three decisions we must mention: Dr. Mrs. Urmilla Shukla vs State of M.P. & Ors., (Misc.
Petition No. 297/83 decided on 17.4.84); Rekha Saxena vs State of M.P. & Ors., and Dr. Sunil Gajendragadkar vs State of M.P., (Misc.
Petition No. 57/85 decided on 11.3.85).
In Dr. Urmilla Shukla 's case, the facts were these.
Dr. Mrs. Urmilla Shukla had applied for admission to the PG course in MS in Gynaecology and Obstetrics as well as to the Diploma course in that discipline in G.R. Medical College, Gwalior for the academic year 1983 84.
It was not in dispute that there were 7 Lecturers in Obstetrics & Gynaecology in that College and as such 7 students had to be admitted for the PG course in MS in Gynaecology and Obstetrics.
As per r. 2.2 of the Rules the State Government had fixed the ratio of 2/3rd for the merit candidates and 1/3rd for the candidates in Government Service as Assistant Surgeons or equivalent posts, for admission to Post Graduate course in Gynaecology.
No rules had been framed for working out the ratio of 2/3rd and 1/3rd.
Dr. Mrs. Urmilla Shukla stood fifth in the merit list.
However, the authorities did not select her for the studies in MS course in Obstetrics & Gynaecology for the academic session starting from August 1983 but gave her admission to the Diploma course.
She made a representation that she should have been given admission to the PG course in MS in Obstetrics & Gynaecology and not to the Diploma course, contending that there was no justification now the ratio of 4:3 had been worked out.
The Government however rejected the representation and there upon she moved the High Court.
The High Court allowed the writ petition and struck down the decision of the State Government dated August 30, 1983 fixing the ratio at 4:3 as being wholly arbitrary and without any rational basis, and held that the ratio should have been 5:2.
C.P. Sen, J. speaking for himself and R.C. Shrivastava, J. explained that 2/3rd of 7 came to 4.666 while 1/3rd was 2.333.
and the question was now the figure had to be rounded PG NO 291 off for filling up the 7 seats.
The learned Judge explained that the proper method would be that if the figure is more than half the same has to be rounded off as 1 while if the figure is less than half it is not to be reckoned.
The High Court accordingly issued a writ in the nature of mandamus directing the Government to give admission to Dr. Mrs. Urmilla Shukla to the Post Graduate course in Obstetrics & Gynaecology and permit her to appear at the MS examination in that discipline.
It is however necessary to observe that the learned Judge mentioned that out of 7 seats for the PG course of studies in Obstetrics & Gynaecology, one seat had been kept vacant probably because of the filing of the writ petition by Dr. Mrs. Urmilla Shukla and therefore there could be no impediment to the grant of admission to her and cited a precedent under similar circumstances during the earlier year.
Dr. Miss Sushma Dixit had been admitted to the MS course in Obstetrics & Gynaecology because one of the candidates selected had gone abroad without permission and her admission had been cancelled.
He further pointed out that Dr. Mrs. Urmilla Shukla was pursuing her studies in the Diploma course in Obstetrics & Gynaecology and the syllabus in the MS in that discipline for the first year was the same and therefore there could be no difficulty in her way in determining the percentage of attendance to make her eligible to appear at the examination.
The decision in Dr. Mrs. Urmilla Shukla 's case therefore turned on its own facts.
The decision in Rekha Saxena 's case was an aftermath of the decision in Dr. Mrs. Urmilla Shukla 's case Dr. Rekha Sexena had applied for admission only to the Diploma course in Gynaecology & Obstetrics and she rightly contended that the ratio for the P.G. course in MG between merit candidates and Assistant Surgeons should have been 5:2 and she being placed at serial No. 4 in the merit list, should have been admitted to the Diploma course.
She complained that after Dr. Urmilla Shukla was given admission to the MS course, she made an application that she be given provisional admission to the Diploma course on the assurance that if ultimately Dr. Urmilla Shukla had to come back to the Diploma course she would walk out and further that she could not claim any stipend for the period of her studies, and that though the High Court allowed the writ petition of Dr. Urmilla Shukla and the College Council recommended her case for admission to the Diploma course, the authorities turned down her claim on the ground that she could not be given admission in 1984 against the quota for the academic year 1983 84.
The petitioner in her rejoinder pointed out the instance of Dr. Miss Sushma Dixit who was given admission to the MS course in Gynaecology & Obstetrics in the month of March 1983 PG NO 292 though she was doing her Diploma course for the academic year 1982 83, and made a grievance that she was being discriminated against as the authorities were adopting different yardsticks in her case.
In the return filed by the State Government, the facts were not disputed.
All that was said was that against the aforesaid judgment of the High Court in Dr. Mrs. Urmilla Shukla 's case, the State Government had taken an appeal to the Supreme Court and therefore her seat in the Diploma course was kept vacant and had not been declared to be available for any other candidate.
Upon this basis, it was asserted that as there was no seat vacant, no admission could be granted to Dr. Rekha Saxena.
At the hearing of the writ petition the Government 's appeal in Dr. Mrs. Urmilla Shukla 's case was still pending.
G.L Oza, Actg.
speaking for himself and Rampal Singh, J. allowed the writ petition and directed that the petitioner Dr. Rekha Saxena be given provisional admission to the Diploma course in the vacancy caused on admission being granted to Dr. Mrs. Urmilla Shukla to the MS course.
The High Court repelled the contention that the petitioner was a candidate for admission to a course for the academic year 1983 84 and could not be admitted in the year 1984, and observed: "It is strange that this request of the petitioner dated 26.8.1983 was ultimately turned down by the respondents by an order dated 25.4.1984, practically eight months after this prayer was made by the petitioner.
This delay in taking a decision on such matters when every day that passes in the life of a professional candidate is materially speaks volumes about the efficiency of this department and the rejection is on this basis that the petitioner was selected for the year 1983 and could not be admitted in the year 1984.
This logic of this order, it appears, is not defended in the return and a new defence has been raised in the return that as the case of Dr. Smt.
Urmilla Shukla is not yet finally decided and is pending in the Supreme Court, the seat has not been declared vacant although it is not disputed that the seat is and was vacant in fact.
It is peculiar that if Dr. Smt.
Urmilla Shukla could be given a provisional admission, why the petitioner could not have been given provisional admission immediately when she had herself offered in terms which would throw no liability on the respondents if ultimately she had to go back, but it appears that her application was not considered and ultimately practically major part of the session was wasted PG NO 293 and then the refusal was on the ground of delay for which the authorities themselves were responsible.
It is, therefore, plain that this kind of attitude could not be justified.
" It was then observed: "It is also interesting that in fact the selection of a candidate for admission to a course is for the academic session which is August 1983 to August 1984 and, therefore, when this order in April 1984 was passed, the session was still in the offing and if the petitioner was granted admission, there was no question of consideration of merit for the year 1984.
It is also plain that the seat remained vacant as Dr. Smt.
Urmilla Shukla had been admitted in the M.S. Course. ' ' Incidentally, the High Court was not impressed with the submission made on behalf of the Government that there was no declaration that the seat in the Diploma course had fallen vacant and therefore there was no question of giving admission to the petitioner, observing that formal declaration of vacancy was too abstract a concept to deprive a candidate admission to the P.G. Course or Diploma course to which he is entitled, merely on the ground that the vacancy pertained to the academic year which had gone by or that no additional seat in the new year could be created without sanction of the Medical Council of India.
In coming to the conclusion that it did, the High Court mainly relied on certain observation made by this Court in Punjab Engineering College vs Sanjay Gulati & Ors., ; , and in particular to the following observations: "Those who infringe the rules must pay for their lapse and the wrong done to the deserving students who ought to have been admitted has to be rectified.
The best solution under the circumstances is to ensure that the strength of seats is increased in proportion to the wrong admissions made.
" We need not enter into this controversy.
What is of significance is that in Rekha Saxena 's case the seat occupied by Dr. Urmilla Shukla in the Diploma course in Obstetrics & Gynaecology was kept vacant and therefore there was no legal impediment for the High Court to have issued a direction for the admission of Dr. Rekha Saxena.
PG NO 294 In Sunil Gajendragadkar 's case, the facts were more or less these.
One Dr. Laxmi Jain did not join the P.G. course in MD in General Medicine for the academic year 1983 84 and the College Council on December 22, 1984 decided to cancel her admission w.e.f.
August 1, 1984.
But the vacancy caused thereby was not notified or advertised.
The High Court relying on Rekha Saxena 's case repelled the contention of the Government based on r. 10 that a seat falling vacant in a particular year can only be filled up in that year and the Sunil Gajendragadkar could not be admitted in the academic session 1983 84 which commenced from August 2, 1983.
Oza, CJ.
speaking for himself and Ram Pal Singh, J. repelled the contention of the Government that the petitioner being a candidate for admission to the P.G. course in MD in General Medicine for the academic year 1983 84, could not be considered for admission in the year 1984 85 relying on the earlier decision in Rekha Sexena 's case based on the observation of this Court in Punjab Engineering College that "those who infringe the rules must pay for their lapse and the wrong done to the deserving students who ought to have been admitted has to be rectified.
The best solution under the circumstances is to ensure that the strength of seats is increased in proportion to the wrong admissions made", and quoted from Rekhu Saxena 's case: "In the present case, as it is clear that in the vacancy of Dr. Urmilla Shukla the petitioner was entitled to admission immediately in August l983 itself, and if the respondents had chosen to keep her away by not considering her prayer, it could not be contended that now it is too late for her to be admitted.
" The learned Chief Justice largely relied on the concept of justice and fairness.
He adverted to the fact that the College Council took a decision on December 22, 1984 creating a vacancy w.e.f. August 1, 1984 i.e. commencement of the next academic session.
Although Dr. Laxmi Jain did not join the P.G. course in MD in General Medicine in August 1983, her seat was in fact vacant, but due to apathy and lethargy of the authorities no steps were taken to fill up the seat in that year in terms of r. 10.
On the language of r. 10, we find it difficult to sustain the action of the authorities in making the seat available from August 1, 1984 i.e. commencement of the next academic year, or the view expressed by the High Court.
In the appeal preferred by Dr. Sanjay Kumar Shrivastava, it is conceded by learned counsel appearing for the State Government that there is no provision which empowered the PG NO 295 State Government to transfer a seat in the P.G. course in MD/MS reserved for a medical college to another medical college.
It must therefore follow that the High Court was obviously wrong in holding that the seat occupied by Smt.
Dhurupkar had been transferred with her when the same was, in fact, available.
On the construction that we place on r. 10 of the Rules, the appellants are not entitled to any relief.
Obviously, the seat that became vacant in the academic year 1986 87 cannot now filed in terms of r. 10.
We wish to impress upon the State Government of Madhya Pradesh the desirability of taking immediate steps under r. 10 of the Rules to fill up the vacancy in the P.G. course in MD/MS or the diploma course of studies in a particular discipline, the moment the seat in a medical college in that discipline is available in a medical college in any particular academic year.
The State Government should ensure that the authorities charged with the duty of granting admission to students under r. 10 of the Rules must act with due promptitude, and should not by their lethargy or inaction deprive an otherwise meritorious candidate admission to such a higher course of studies to which he was otherwise entitled.
Perhaps, the solution lies in making a suitable provision in the Rules providing for a reasonable period, say fifteen days, within which the authorities ought to exercise their powers under r. 10 of the Rules, failing which the seat available would be deemed to have been filled by the candidate placed first in the waiting list strictly according to merit.
In the result, the appeals must fail and are dismissed.
There shall be no order as to costs.
R.S.S. Appeals dismissed.

summary:
A seat in the P.G. course in M.D. in the G.N. Medical College, Gwalior, fell vacant due to the death of a student.
The appellant, Dr. Sanjay Pradhan, staked a claim to this seat under rule 10 of the Madhya Pradesh Selection for Post Graduation Courses (Clinical, Para clinical and Non clinical Courses) in Medical Colleges of Madhya Pradesh Rules, 1984.
Inasmuch as the vacancy arose towards the end of the academic year, the authorities took no steps to fill it up.
The appellant 's writ petition was dismissed By the M.P. High Court.
The High Court construed the words 'filled up in that year ' in r. 10 as meaning that a vacancy in any particular academic year must be filed up in that year.
One seat in the P.G. Course in M.S., which was occupied by Dr. Smt.
Dhurupkar, was transferred from Medical College, Jabalpur, to Medical College, Bhopal, with a view to accommodate her.
The appellant, Dr. Sanjay Kumar, moved the authorities seeking admission against that seat contending that the seat had become available in terms of r. 10.
The authorities disallowed his claim.
His writ petition was dismissed by the High Court in limine holding that the seat occupied by Dr. Smt.
Dhurupkar had been transferred with her and hence the seat, in fact, was not available.
It was submitted before this Court that the High Court has consistently been taking a view that it has the power as well as the duty to issue an appropriate writ, direction or order for the 'backlog ' of seats to be filled up whenever it finds that the authorities have acted in violation of the norms prescribed by the relevant rules and a deserving candidate has been wrongly denied admission to such a professional course of studies.
PG NO 281 PG NO 282 Dismissing the appeals, it was, HELD: (1) Rule 10 must be interpreted by the written text.
If the precise words used are plain and un ambiguous, the Court is bound to construe them in their ordinary sense and give them full effect.
The argument of inconvenience and hardship is a dangerous one and is only admissible in construction where the meaning of the statute is obscure and there are alternative methods of construction.
Where the language is explicit its consequences are for parliament, and not for the Courts, to consider.
[287C D] (2) On a plain construction, rule 10 stipulates that if a seat falls vacant for any reason, and due to inaction on the part of the authorities the seat is not filled up in the academic year to which it pertains, there is no question of the vacancy being carried forward to the next academic year.
[288A B] (3) Normally, the question of a seat being filled up must arise at the commencement of the academic year or soon thereafter.
When a seat falls vacant in any particular academic year there is a corresponding duty cast on the authorities to take immediate steps to fill up the same.
There is no question of a right of admission to a seat falling vacant in the midst of or towards the end of, the academic year.
[288C] (4) it is conceded by learned counsel appearing for the State Government that there is no provision which empowered the State Government to transfer a seat in the M.S. course in MD/MS reserved for a medical college to another medical college.
It must therefore follow that the High Court was obviously wrong in holding that the seat occupied by Dr. Smt.
Dhurupkar had been transferred with her when the seat was, in fact, available.
[285C D] (5) On the construction placed on r. 10 of the Rules, the appellants are not entitled to any relief.
Obviously, the seat that became vacant in the academic year 1986 87 cannot now be filed in terms of section 10.
[295B] (6) It is impressed upon the State Government the desirability of taking immediate steps under rule 10 of the Rules to fill up the vacancy in the P.G. Course in MD/MS or the Diploma course of studies in a particular discipline, the moment the seat in that discipline is available in any particular academic year.
[295C D] PG NO 283 (7) The State Government should ensure that the authorities charged with the duty of granting admission to students under rule 10 of the Rules act with due promptitude, and should not by their lethargy or inaction deprive or otherwise meritorious candidate admission to such a higher course of studies to which he was otherwise entitled.
Perhaps, the solution lies in making a suitable provision in the Rules providing for a reasonable period, say fifteen days, within which the authorities ought to exercise their power under rule 10 of the Rules, failing which the seat available would be deemed to have been filled by the candidate placed first in the waiting list strictly according to merit.
[295D E] King Emperor vs Bensari Lal Sarma, LR (1945) 72 IA 57; Dr. Mrs. Urmilla Shukla vs State of M.P., Misc.
Petition No. 297/83 decided by M.P. High Court on 17.4.84; Rekha Saxena vs State of M.P., [l985] MPLJ 142; Dr. Sunil Gajendragadkar vs State of M.P. (Misc.
Petition No. 57/85 decided by M.P. High Court on 11.3.85.


judgement:
it Petition (Civil) No. 611 of 1986.
(Under Article 32 of the Constitution of India).
H.K. Puri for the Petitioners.
M.P. Jha for the Respondents.
The Judgment of the Court was delivered by PG NO 380 KANIA, J.
This writ petition is filed under Article 32 of the Constitution of lndia by the West Bengal Hosiery Association and certain Hosiery manufacturers and dealers in the State of West Bengal against the State of Bihar and the Commissioner of Commercial Taxes cum Special Secretary, Bihar praying for a direction to the Respondents to forebear from levying or imposing or collecting any sales tax on the sale of hosiery goods imported into the State of Bihar from other States for sale during the tenure of Circular No. So 934 dated 1st August, 1984, exempting from such tax, sales of hosiery goods manufactured or produced in the State of Bihar and to refund the amount of sales tax levied and collected on the sale of hosiery goods imported into the State of Bihar from other States in India from 1st August, 1984.
The Petitioners have also prayed for a writ of mandamus commanding the Respondents to cancel, withdraw or rescind Notification No. SO.
934 dated August 1, 1984 by which exemption was granted to hosiery industries of Bihar from the levy of sales tax as set out earlier and the Petitioners have also prayed that the Respondents should be directed to refrain from making any discrimination between hosiery goods imported into the State of Bihar and hosiery goods manufactured in the State of Bihar in the levy of Bihar Sales Tax.
The writ petition can be very shortly disposed of because the point raised in the writ petition is directly covered by decisions of this Court.
By a notification dated 30th September, 1983, on and from October 1, 1983, Bihar Sales Tax at the rate of 5 per cent ad valorem was imposed on all hosiery goods sold within the State of Bihar irrespective of the place whether the hosiery goods were manufactured.
On August 1, 1984, a Notification bearing No. SO 934 was issued whereby the hosiery goods manufactured by hosiery industries in Bihar were exempted from the levy of sales tax.
The said Notification stated that it would remain valid for a period of five years.
The reason given for this exemption was the grant of incentives to hosiery industries in Bihar.
The contention raised before us by Mr. Sorabji, learned Counsel for the Petitioners, is that by reason of the said Notification all the sales of hosiery goods in Bihar manufactured by hosiery industries outside the State of Bihar are subjected to the levy of sales tax at the rate of 5 per cent whereas the sales of hosiery goods manufactured by hosiery industries in Bihar are exempted from such levy and thus the hosiery industries outside the State of Bihar are clearly discriminated against.
It is submitted by learned Counsel that this discrimination violates the provisions of Article 301 of the Constitution of lndia.
PG NO 381 The relevant Articles to consider in order to appreciate the contention of the Petitioners are Articles 301 & 304 of the Constitution of India.
The said Articles run as follows: 301.
Subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of lndia shall be free.
Notwithstanding anything in article 301 or article 303, the Legislature of a State may by law (a) impose on goods imported from other States or the Union territories any tax to which similar goods manufactured or produced in that State are subject, so, however, as not to discriminate between goods so imported and goods so manufactured or produced; and (b) impose such reasonable restrictions on the freedom of trade, commerce or intercourse with or within that State as may be required in the public interest: Provided that no Bill or amendment for the purposes of clause (b) shall be introduced or moved in the Legislature of a State without the previous sanction of the President.
" A plain reading of these Articles would show that it is not open to any State to levy any tax on goods imported from other States or Union territories so as to discriminate between goods so imported and goods manufactured and produced in that State subject to the limitations contained in clause (b).
In the present case, clause (b) has no application whatsoever because the exemption granted to the sales of hosiery goods manufactured in the State of Bihar has not been granted by any law passed by the legislature of the State of Bihar but by a Notification.
We find that the contention urged on behalf of the Petitioners has been accepted in several decisions of this Court.
In H. Anraj etc.
vs Government of Tamil Nadu etc.
[1985] Supp. 3 S.C.R. 342 a Division Bench of this Court comprising Tulzapurkar and Sabyasachi Mukharji, JJ., was called upon to consider whether an amendment made to the Tamil Nadu General Sales Tax Act, 1959 and the Orders and Notification issued thereunder whereby, in effect, exemption from the payment of sales tax was granted to lottery tickets issued by the PG NO 382 Government of Tamil Nadu but the lottery tickets issued by other Government and sold within the State of Tamil Nadu were subjected to sales tax, was violative of Article 301 read with Article 304 of the Constitution.
A similar challenge was also made to the validity of the West Bengal Taxation Laws (Second Amendment) Act, 1984 and Notification No. 1020 FT dated March 29, 1984 issued by the State of West Bengal.
The Court took the view for the purposes of questions raised in that case lottery tickets could be regarded as "goods".
The Court held that laws imposing taxes can amount to restrictions on trade, commerce and intercourse, if they hampered the free flow of trade and they are not what can be termed to be compensatory taxes on regulatory measures.
It was held that the sales tax of the kind in question before the Division Bench could not be said to be a measure regulating any trade or a compensatory tax levied for the use of trading facilities.
Sales tax which had the effect of discriminating between goods of one State and goods of another might affect the free flow of trade and would offend against Article 301 and would be valid only if it came within the terms of Article 304(a).
The real question to be considered was whether the direct and immediate result of the impugned Notification was to impose an unfavourable and discriminatory tax burden on the imported goods which in that case were lottery tickets of other State when they were sold within the State of Tamil Nadu and the State of West Bengal as against indigenous goods and that this question had to be considered from the normal business or commercial point of view.
If the question was so considered, it could be seen that the impugned Notifications would have to be regarded as directly and immediately hampering the free flow of trade, commerce and intercourse.
This view was taken after considering several decisions of this Court and following the decision of this Court in Firm A.T.B. Mehtab Majid and Co. vs State of Madras & Anr., [1963] Suppl.
2 S.C.R. 435.
A similar view has been taken by a Division Bench of this Court comprising Ranganath Misra & M.M. Dutt, JJ., in a judgment delivered as recently as January 12, 1988 in The Indian Cement & Ors.
vs The State of Andhra Pradesh & Ors., ; where it has been observed (p. 759) as follows: "Variation of the rate of inter State sales tax does affect free trade and commerce and creates a local preference which is contrary to the scheme of Part Xlll of the Constitution.
" In the present case, a perusal of the Notifications referred to earlier show that prima facie a clear discrimination is made against hosiery goods manufactured PG NO 383 outside the State of Bihar and sold in the State of Bihar as the sales of such goods are subjected to the levy of sales tax at the rate of 5 per cent whereas the sales of similar goods manufactured by hosiery industries in the State of Bihar are exempted from sales tax.
From a commercial or normal point of view, such a discriminatory levy of sales tax is bound to affect the free flow of hosiery goods from outside States into the State of Bihar and would, therefore, amount to hampering the free flow of trade and commerce.
The State of Bihar has not chosen to file any counter to the petition or to justify this discriminatory levy as a regulatory measure or a compensatory tax.
The result is that the discrimination made must be regarded as violating the provisions of Article 301 read with Article 304(b) of the Constitution.
This brings us to the question as to the relief to which the Petitioners are entitled.
This Court in Weston Electroniks and Anr vs State of Gujarat & Ors., dealt with a situation like the one in the case before us.
In that case the facts were that Section 7 of the Gujarat Sales Tax Act, 1969 provides for the levy of sales tax on the turnover of sales of goods specified in Part A Schedule II of the said Act.
Entry 80 A of Part A of Schedule II specifies the rate of tax applicable to the turnover of television sets.
That rate was 15 per percent originally and upto 1981; and the entry applied to all television sets, whether manufactured and sold within the State of Gujarat or imported from outside the State.
In 1981, while the rate of tax on electronic goods entering the State for sale therein was maintained at 15 per cent, the rate in respect of locally manufactured goods was reduced to 6 per cent.
By a Notification dated March 29, 1986, issued under sub section (2) of Section 49 of the said Act which empowered the State Government to exempt in part r whole, in public interest, any specified class of sales from the payment of the whole or any part of the tax payable under that Act, in 1986, the rate of sales tax in respect of television sets imported from outside the State was reduced from 15 per cent to 10 per cent and for goods manufactured within the State, the rate of sales tax was reduced to 1 per cent.
The Petitioners before this Court submitted that the Notification specifying a lower rate for local manufactures should be quashed.
It was held that the rate prescribed under Section 7 of the Gujarat Sales Tax Act, 1969 is the rate applied generally and it represents the normal standard of levy.
The lower rate applied to local manufacturers represents a departure from or exception to the general norm.
In such a case the Court should, when granting relief, choose the alternative which would give effect to the statutory intention; and, following this principle, it was PG NO 384 held that the impugned Notifications reserving a lower rate of tax for local manufacturers must be quashed.
In the case before us we find that the general rate of sates tax on hosiery goods was 5 per cent and it was the exemption for locally manufactured hosiery goods, granted by the said Notification No. SO 934 dated August 1, 1984, which constituted the departure.
It is, therefore, really this Notification which is discriminatory and which must be struck down.
We find that the said Notification No. SO 934 dated August 1, 1984 is void for the reasons set out earlier and we quash the same.
We realise that quashing of this Notification on the ground that it was void ab initio might lead to undue hardship for the dealers in the State of Bihar who might have sold locally manufactured hosiery goods without taking into consideration any amount on account of the liability to sales tax in view of the exemption granted by the said Notification dated August 1, 1984.
In order to obviate this hardship, we direct that the arrears of sales tax which would become payable by the dealers in the State of Bihar in respect of sales of local hosiery goods made during the period when the said Notification was in operation should not be collected.
Rule is made absolute to the extent aforesaid.
However, taking into account the facts and circumstances of the case, we direct that there shall be no order as to costs.

dataset_name: IN-Abs

summary:
The Bihar Government imposed sale tax at 5 ad valorem on all hosiery goods sold within the State irrespective of the place of manufacture of such goods, effective from October 1.
However, by virtue of a notification dated August 1,1984 , it exempted from such levy, the hosiery goods manufactured by hosiery industries in Bihar.
This exemption was sought to be given as an incentive to hosiery industries in Bihar.
The petitioners have approached his Court by way of a writ petition, contending that there has been discrimination between hosiery goods imported into the State of Bihar and hosiery goods manufactured in that State in the levy of sales tax.
They prayed for the issue of a writ of mandamus to the Respondents to rescind the notification dated August 1, 1984, and for a direction to the Respondents to forebear from levying or collecting sales tax on sale of hosiery goods imported into the State of Bihar from other States, and for refund of the sales tax already levied and collected.
The petitioners contended that such discrimination violated article 301 of the Constitution of India, and that such discrimination could never be made by a notification.
Allowing the writ petition and quashing the notification in question, this Court HELD: 1.1.
A perusal of the Notifications would show that prima facie a clear discrimination is made against hosiery goods manufactured outside the State of Bihar and sold in the State of Bihar PG NO 378 PG NO 379 as the sales of such goods are subjected to the levy of sales tax at the rate of 5 per cent whereas the sales of similar goods manufactured by hosiery industries in the State of Bihar are exempted from sales tax.
From a commercial or normal point of view, such a discriminatory levy of sales tax is bound to affect the free flow of hosiery goods from outside States into the State of Bihar and would, therefore, amount to hampering the free flow of trade and commerce.
The State of Bihar did not file any counter to the petition to justify this discriminatory levy as a regulatory measure or as a compensatory tax.
The result is that the discrimination made must be regarded as violating the provisions of Article 301 read with Article 304(b) of the Constitution.
[382H; 383A C] 1.2.
The general rate of sales tax on hosiery goods was 5 per cent and it was the exemption for locally manufactured hosiery goods, granted by the said Notification dated August 1, 1984 which constituted the departure.
It is, therefore, really this Notification which is discriminatory and which must be struck down.
[384A,B] H. Anraj etc.
vs Government of Tamil Nadu etc.
[1985] Suppl.
3 SCR 342; Firm A.T.B. Mehtab & Co. vs State of Madras & Anr., [1963] Suppl.
2 SCR 435; The Indian Cement & Ors.
vs The State of Andhra Pradesh & Ors., ; ; Weston Electroniks and Anr.
vs State of Gujarat & Ors., , referred to.
[This Court directed that since there might be undue hardship to the dealers in the State of Bihar who might have sold locally manufactured goods without taking into consideration the liability to sales tax in view of the exemption granted by the notification dated August 1, 1984, the arrears of sales tax payable by them should not be collected.]


judgement:
tion (Crl.) No. 1574 of 1982 (Under Article 32 of the constitution of India) T. V. section N. Chari for the Petitioner.
G. Narasimhulu, N. Santosh Hegde, Advocate General P. R. Ramasesh, A.V. Rangam and S.K. Mehta for the Respondent.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
A letter written by the Secretary/Spokesman of the Great War Ex Services Organisation at Tirukkoyilur in South Arcot District of Tamil Nadu alleging prevalence of bonded labour in stone PG NO 349 quarries in several districts of Andhra Pradesh and other areas was registered as Writ Petition No. 1574 of 1982.
The other three applications are similar matters.
We propose to confine reference to the first case as, through interlocutory orders, whatever relief was necessary had been given in these matters.
On 25th of January, 1983, this Court made the following order: "Writ petition is adjourned for three weeks.
Meanwhile District Magistrate, Hyderabad, and a representative of AWARE will jointly and together visit the site referred to in the writ petition of the petitioner and make a report to this Court in regard to the various averments made in the writ petition.
The report shall be made by the District Magistrate, Hyderabad and the representative of the AWARE within two weeks from today . .".
On 19th August, l983, this Court again directed : "The writ petition is adjourned to 28.9.83.
Meanwhile, the respondent State of Andhra Pradesh will file an affidavit setting out in detail facts and figures showing how many bonded labourers have been identified and released in the different districts or the State since 1.1.83 and whether they have been rehabilitated and if so, in what manner and whether there is any follow up action.
If there are any freed bonded labourers who have not yet been rehabilitated, the respondent State of Andhra Pradesh will set out in its affidavit whether any step have been taken for keeping track of them after their release and what measures it proposes to adopt in the immediate future for their rehabilitation.
We are informed that Vigilance Committees have been constituted in some of the districts of the State.
We would, therefore, direct that Vigilance Committees shall be set up at a very early date in all the districts and sub divisions of the State and in these Vigilance Commmittees, social activists shall be included as members on the basis of their record of social commitment because it is now recognised on all hands that it is only through the active involvement of voluntary agencies and social action groups that the problem of identification of bonded labour can he solved.
We would also direct that in every Vigilance Committee, constituted or to be constituted, a representative of AWARE if available, shall be included PG NO 350 as a member in order to ensure vigorous and effective implementation of the programme of identification and rehabilitation of bonded labour.
We would also like the district Judge Krishna District to visit the stone quarries at Kailaspuram and inquire whether there are still any workmen working in the stone quarries against their will and whether the advances made to the workmen are written off as promised by the contractors and whether they are paying to the workmen higher wages ranging from Rs.56 to Rs.75 per unit without any deductions Soon after the report of the District Judge was received, this Court made another order on 20th of October, 1983, where it was stated interalia : "The second direction relates to the observance of the various labour laws in stone quarries in Kailaspuram in Krishna District.
The State Government has made various suggestions in the affidavit of Shri K. Parthsarathy for the purpose of ensuring observance of the labour laws for the benefit of the workers engaged in the stone quarries and has also put forward a few other suggestions with a view to improve the living conditions of the workmen.
We hope and trust that the State Government will.
without any undue delay, proceed to carry out these suggestions and shall not wait for any directions to be given by this Court in that behalf.
It appears from the report of the District Judge that it is extremely doubtful whether the Labour Iaws are being enforced properly.
It is, therefore, necessary to direct an inquiry for the purpose of ascertaining whether the labour laws are being properly observed.
There can be no doubt that the stone quarry being a mine within the meaning of , the provisions of , the Mines Rules, 1955, Mines Vocational Training Rules, Mines Crush Rules and Minimum Wages Act are applicable to workmen employed/engaged in stone quarries.
So also the provisions of the Contract Labour Regulations and Abolition Act are applicable.
In case the work of the stone quarrying or any part thereof is entrusted by the mine owners of the stone PG NO 351 quarries or the lessee of stone quarries to contractor or labour/workmen are recruited through the agency of contractors, there are various magnificent provisions enacted in these labour laws for the benefit of persons engaged/employed in stone quarries and it is essential that the benefits of these provisions must be made available to the workmen.
We would, therefore, direct Shri Lakshmidhar Mishra, Joint Secretary, Ministry of Labour, Government of India, to visit the stone quarry at Kailaspuram and to hold an inquiry for the purpose of ascertaining whether there is existence of bonded Labour and whether the , Mines Rules, 1955, Mines Vocational Training Rules, Mines Crush Rules and the Contract Labour (Regulations and Abolition) Act, and the , are being observed. . . ".
Pursuant to these orders the District Judge of Krishna District.
AWARE and Mr. Lakshmidhar Mishra submitted three separate reports, copies whereof had been furnished to the respondents.
It is appropriate to indicate at this stage that the necessity to appoint Mr. Lakshmidhar Mishra to go into the aspects indicated in the order refer red to above arose out of the report of the District judge as he had indicated that several beneficial legislations meant for protecting the interests of the workmen were not being enforced.
On 10th of January,1984, after the report by Mr. Mishra was furnished to the Court, the following order was made: "Pursuant to the order made by us on 20th of October, I983, Sri Lakshmidhar Mishra, joint Secretary, Ministry of Labour, Government of India, visited the stone quarries at kailaspuram and held an inquiry for the purpose of ascertaining whether there is existence of bonded labour and whether the , Mines Rules, 1955 Mines Vocational Training Rules, Mines Creche Rules, 1955, Contract Labour (Regulation & Abolition) Act, and the are being observed or not.
He has submitted a report to the Court and copies of this report have been supplied to the learned advocates appearing an behalf of the parties.
Mr. Ram Reddy, learned Advocate appearing on behalf of the State of Andhra Pradesh has requested for time in order to consider this report and he PG NO 352 has assured us that the suggestions and recommendations of Shri Lakshmidhar Mishra in this report will be carried out by the State of Andhra Pradesh to the extent feasible and in case of any difficulty, the matter will be brought to the notice of the Court so that appropriate directions can be given.
We adjourn the writ petitions to 21.2.1484 in order to enable the State of Andhra Pradesh to carry out the suggestions and recommendations made in the report of Shri Lakshmidhar Mishra and to file appropriate affidavit setting out what steps and measures have been taken by the State Government and if any of the suggestions and recommendations have not been carried out what are the difficulties in regard to the carrying out of such suggestions and recommendations and also as to how the State Government propose to resolve them.
We hope and trust that the State of Andhra Pradesh will carry out the suggestions and recommendations contained in the report of Shri Lakshmidhar Mishra within the time allowed to them.
We also issue notice to the Central Government which is responsible for the enforcement of the , Mines Rules, 1955, Mines Vocational Training Rules and Mines Creche Rules since it has already been held by this Court in a judgment delivered on 16.12.1983 in the case of Bandhua Mukti Morcha vs
Union of India & Qrs., [l984] 3 SCC 161 that stone quarries are mines within the meaning of the and the provisions of the Mines Act, 1452, Mines Rules, l95t, Mines Vocational Rules and Mines Creche Rules are applicable to the stone quarries.
The Registry will forward to the Ministry of Mines as also to the Ministry of Labour, Government of India, along with the notice, copies of the writ petitions and of the report made by Shri Lakshmidhar Mishra.
The control Government will in the meanwhile take steps to ensure that the provisions of the and the connected laws are observed in the stone quarries of Kailasgiri and make a report in that behalf of this Court before the next date of hearing .
As a result of the action taken by the Court in these writ petitions, about 700 bonded labourers were freed earlier and thereafter about 1,500 more bonded labourers were freed.
The State of Andhra Pradesh also arranged for PG NO 353 their transport from Kailasgiri to their homes situated outside the State of Andhra Pradesh.
We would direct the State of Andhra Pradesh to furnish to the Court at the next hearing of the writ petitions a list of bonded labourers who were thus freed and sent back to their homes so that we can give appropriate directions for their rehabilitation." Pursuant to these directions, the State of Andhra Pradesh filed an affidavit and supplied particulars of 1417 persons freed from bonded labour and took the stand that in regard to the remaining particulars were not available.
The Union of India in the Ministry of Labour and Rehabilitation also filed its affidavit through Shri J.K. Jain, Under Secretary in the Ministry.
On 7th of March, 1984, this Court made the following Order: "The Union of lndia has filed a counter affidavit in this case a copy of which has been supplied to Mrs. Hingorani, Advocate for the petitioner.
Copies have not yet been supplied to the Advocate for the State of Andhra Pradesh and the same may be done immediately.
The State of Andhra Pradesh has filed an affidavit setting out a list of 1417 bonded labourers who have been released and repatriated to their respective State namely.
Orissa.
Karnataka and Tamilnadu. .
We would direct the State of Andhra Pradesh to prepare three separate lists of the released bonded labourers repatriated to the State of Tamilnadu, the State of Karnataka and the State of Orissa and supply copies of these lists to Mrs. Hingorani on behalf of the petitioner and also a copy of the concerned list to the Advocates appearing on behalf of the States Tamilnadu and Karnataka.
So far as the State of Orissa is concerned a copy of the concerned list shall be forwarded to the Chief Secretary of the State of Orissa and also served on the standing counsel for the State of Orissa.
Notice on the writ petition shall be served on the State of Karnataka and Orissa and also additionally on the standing counsel of these two States.
We would direct the State of Tamilnadu, Karnataka and Orissa to take immediate step for the purpose of rehabilitating these released bonded labourers who have been repatriated to their respective States as is shown in the list supplied to them to inform the court at the next hearing of the writ petition as to what steps they have taken and are taking to rehabilitate them.
PG NO 354 It is the obligation of the State Government under the Bonded Labour Act, l976 to rehabilitate the freed bonded labourers.
We would also suggest to the States of Tamilnadu, Karnataka and Orissa that in constituting the vigilance committees which are also to be associated in the work of rehabilitation of the freed bonded labourers, they should involve the representatives of social action groups and voluntary agencies operating in these areas and whatever rehabilitation is provided to the freed bonded labourers, must be provided in the presence of a representative of such social action groups or voluntary agencies so as to ensure that rehabilitation provisions actually reach the hands of such labourers.
These three State Governments will submit a report to this Court on or before 13th of April, 1984 On 6th October, 1987, when the matter was again listed this Court made the following Order: "On 7th March, 1984, this Court directed the States of Tamil Nadu, Karnataka and Orissa to take immediate steps for rehabilitating the 1417 bonded labourers released from the site in Ranga Reddy district.
Directions were also given to these three States to submit Reports of action taken.
We are surprised that though three and a half years have elapsed, there has been no compliance on behalf of any of the States.
We are prepared to give one more opportunity to these three States but on terms of costs.
A copy of the Report furnished by the State of Orissa to the Registry of this Court dated 4.11.86 is supplied to us in Court by the counseI for the State of Orissa.
which indicates that 86 freed bonded labourers repatriated from Andhra Pradesh came to that State.
80 of them have been rehabilitated.
Of the remaining six two left their place of residence after getting rehabilitation assistance and in regard to the remaining four, it is stated that they have left for unknown destination and efforts are on to trace them.
In the absence of any Report from the States of Tamil Nadu and Karnataka it is not known as to how many of the released bonded labourers went to those States and what happened to them.
Counsel for the petitioner makes grievance PG NO 355 that a complete list of 1417 released bonded labourers has not been supplied to her in spite of the Court 's direction.
Counsel appearing for the State of Andhra Pradesh who supplied the particulars to the Court is directed to furnish such a list to the counsel for the petitioner as also to the learned Standing Counsel for each of the three States Karnataka, Orissa and Tamil Nadu.
Each of the States is now directed within three weeks from today to furnish a complete affidavit indicating how many of the bonded labourers out of these 1417 came to the State and the manner of rehabilitation provided.
Unless a compliance report is furnished as directed above, each of the States shall be treated to be in contempt of this Court . .
Each of the three States is directed to pay into the Registry of this Court a sum of Rs. 5,000 by way of costs for condonation of the lapses and extention of a further opportunity as indicated above within four weeks.
" By way of complying with the aforesaid Order, the State of Orissa filed an affidavit dated 27th October, 1987.
It stated that as per the particulars provided by the State of Andhra Pradesh only 86 bonded labourers have been repatriated to the State of Orissa.
According to the affidavit of the Under Secretary to the Government of Orissa, Community Development and Rural Reconstruction Department, one of the six alternatives available for rehabilitation had to be opted for by the persons to be rehabilitated and 80 out of these 86 were adequately rehabilitated by being provided with bullock with cart of goatery/sheepery and cow or small tailaring Shop, small grocery shop other small shop or possible combination of the above options with a cash financial assistance of Rs. 4,000.
Out of the six left out, two had gone away from their place after partly getting rehabilitation assistance and the remaining four could not be traced.
The State of Tamil Nadu furnished the particular by an affidavit through its Deputy Secretary in the Social Welfare Department.
The particulars furnished by the State of Andhra Pradesh indicated that a total of 1255 bonded labourers had been repatriated from Andhra Pradesh to Tamil Nadu being 556 from Krishna district, 625 from Ranga Reddy and 74 from Nalgonda.
Paragraph 6 of this affidavit states: ". . 1 beg to enclose a true copy of the letter PG NO 356 as Annexure VI.
I beg to submit that subsequent reminders have also been sent to District Collectors.
So far particulars have been received from some of the District Collectors and details from other Collectors are awaited." and extension of three months ' time was asked for.
The affidavit was sworn on the 28th of October, 1987.
Later a further affidavit was filed by the Commissioner and Secretary to the Government in Social Welfare Department of the State of Tamil Nadu disclosing arrival of 138 of these families in Salem.
Paragraph 4 gave taluk wise details of the families.
In this affidavit, it is stated: "It is submitted that the Government of Tamil Nadu have since issued orders for the grant of cash assistance from Cheif Minister 's Public Relief Fund at the rate of Rs. 1,000 per family for the 138 families.
It is also proposed to rehabilitate the bonded labourers as follows: (i) Supply of quarrying implements like hammer and Crow bar etc.
at the rate of one set for each family free of cost.
(ii) It is proposed to form an Industrial cooperative Society.
The District Rural Development Agency, Salem is to purchase two stone crushing machines at Rs. 1.75 lakhs each of which 50% will be subsidy from Integrated Rural Development Programme and the remaining 50% as loan from the Government.
Share capital and interest free working capital loans are to be sanctioned by Government.
(iii) Construction of thatched sheds for the 138 families at Rs. 1,000." Further affidavits have come from the State of Tamil Nadu through its different officers but a complete disclosure has not yet been made in regard to the bonded labourers who have been repatriated from Andhra Pradesh.
There was, however, no compliance from the State of Karnataka by the time the matter came up before this Court on 3rd November: 1987.
On that day, the Court made the following order: PG NO 357 "Learned Advocate General appearing for the State of Karnataka requires eight weeks ' further time to comply with the previous directions.
We find that an other States have complied with the directions.
Advocate General assures as that within this time counter affidavit will be produced before the Court.
We expect the counsel to deal with the up to date situation.
Counsel for the State of Tamil Nadu states that if given time they will file a better further affidavit .
" In the affidavit of the Deputy Secretary to the Government in the Social Welfare Department sworn on 31st of December, l987, on behalf of the State of Tamil Nadu it has been further submitted that : "apart from 1255 bonded labourers, the Government of Tamil Nadu have rehabilitated 825 bonded labourers who were identified and released from the States of Andhra Pradesh and Karnataka and settled in Tamil Nadu.
In all, 2080 bonded labourers of the States of Andhra Pradesh and Karnataka, including 1255 bonded labourers of Andhra Pradesh covered in these writ petitions have been given relief measures.
The details are furnished in Annexure II.
" Annexure II shows that 1384 freed bonded labour families have been given a total financial assistance of Rs. 10,21,460 and on the average it works out to Rs.738 per family which is certainly inadequate for rehabilitation.
Unless there is effective rehabilitation the purpose of this Act would not be fulfilled.
Up rooted from one place of bonded labour conditions the persons arc likely to be subjected to the same mischief at another place.
The net result would be that the steps taken by this Court would be rendered ineffective and there would be mounting frustration because the persons who were up rooted from a place where they were working under bonded labour situations.
On 11th of May, 1988, when the matter was adjoured to 18th, of July, 1988, the Court made the following order: "The matter be called on l8.7.88.
In the meantime State of Karnataka will take further steps to identify the persons and trace their whereabout.
If they are traced out, steps for their rehabilitation should be taken. . ".
PG NO 358 We are sorry to indicate that there has been really no effective cooperation by the State of Karnataka in spite of several accommodations granted by the Court and assurances by its counsel.
We have referred to the several orders made by this Court from time to time during these five years that the proceedings have been before this Court with a view to impressing on all the concerned as to how difficult it is to work out the Act and to give effect to the scheme of rehabilitation contemplated by the Statute.
Article 23 in the Chapter of Fundamental Rights provides: "Traffic in human beings and begar and other similar forms of forced labour are prohibited and any contravention of this provisions shall be an offence punishable in accordance with law.
" Article 42 of the Constitution makes it the obligation of the State to make provision for securing just and human conditions of work.
There are several other Articles in Part IV of the Constitution which indicate that it is the State 's obligation to create social atmosphere befitting human dignity for citizens to live in.
The Bonded labour System (Abolition) Act of 1976 defines "bonded labour ' ' and section 4 thereof makes a statutory declaration that "On the commencement of this Act, the bonded labour system shall stand abolished and every bonded labourer shall, on such commencement, stand freed and discharged from any obligation to render any bonded labour.
" Detailed provisions have been made for extinguishment of liability to repay bonded debt, implementing authorities have been set up, vigilance committees have been provided, resort to bonded labour has been made an offence and steps for rehabilitation have also been indicated.
Laws, however beneficial they may be, are difficult to be implemented unless the requisite social consciousness has grown.
The system of Bonded Labour has prevailed in this country for centuries.
The gap in economic conditions has been the main cause for this.
This Court in Bandhua Mukti Morcha vs Union of India, (supra) said: "The system of bonded labour has been prevalent in various parts of the country since long prior to the attain PG NO 359 ment of political freedom and it constitutes an ugly and shameful feature of our national life.
This system based on exploitation by a few socially and economically powerful persons trading on the misery and suffering of large numbers of men and holding them in bondage is a relic of a feudal hierarchical society which hypocitically proclaims the divinity of man but treats large masses of people belonging to the lower rungs of the social ladder or economically impoverished segments of society as dirt and chattel.
This system under which person can be bonded to provide labour to another for years and years until an alleged debt is supposed to be wiped out which never seems to happen during the life time of the bonded labourer is totally incompatible with the new egalitarian socio economic order which we have promised to build and it is not only an affront to basic human dignity but also constitutes gross and revolting violation of constitutional values.
" The society envisaged under the constitutional set up can no more take bonded labour as a part of it.
Every citizen must be prepared to accept every other citizen as a person equal to him for enjoying the social benefits and the guarantees provided under the Constitution.
It must, therefore, become a conscious obligation of every employer not to take advantage of the economic disability of a brother citizen and force him into the system of Bonded Labour.
It must equally be the obligation of every citizen to cooperate: in bringing about abolition c,r what is condemned by the laws as Bonded Labour; otherwise, the beneficial legislation would remain on paper with Mere a statutory declaration of abolishing bonded labour as provided in section 4 and yet continue to prevail unabated in the community.
Tolstoy said: ' 'The abolition of slavery has gone on for a long time.
Rome abolished slavery.
America abolished it and we did, but only the words were abolished, not the thing.
" Identifying bonded labour is the read difficult task because very often ever.
the workman working under Bonded Labour system are not prepared to disclose their unfortunate situation and become a party to its, continuance by collaborating with the employer.
The concern of this Court in a matter of this type has been sufficiently indicated in Bandhua Mukti Morcha, case (supra).
Repetition at greater length thereof is perhaps not PG NO 360 warranted.
Twelve years have passed since the law came into the Statute Book and surprisingly it came 26 years after the Constitution came into force.
In 38 years under the Constitution, we have not been able to generate appropriate attitudes and dispositions to live amicably in the polity.
Instead of appropriate consciousness manifesting itself contra indications have widely appeared.
Even those on whom the Statute casts the responsibility of implementing the provisions of the Act do not appear to be in a situation to respond.
It is difficult for the Court to entertain repeated complaints of this type and devote attention by way of monitoring the administration of the Act, as has been done in this case.
We are surprised that about three years were necessary to persuade the State of Andhra Pradesh (where bonded labour was identified and from where repatriation was necessary) and the States of Karnataka, Orissa and Tamil Nadu where rehabilitation was to be provided to perform their statutory obligations.
Here again Karnataka has not yet done its part.
Once notice was issued to them there should have been immediate response and the obligations cast under the Statute should have been readily discharged.
The States should have indicated their regrets to the Court that at their level they had failed to satisfy the requirements of the law and this Court 's interference has become necessary.
This only shows how unsatisfactory the situation is.
Where the man below the poverty line is a citizen entitled to all the benefits and protections so eloquently put into the Constitution.
are 38 years not sufficient to generate the appropriate consciousness '? Before we part with the case we must again indicate that there has been no satisfactory c~compliance in regard to, rehabilitation by the State ot ' Karnataka.
They are given two months ' extended time from today to file an affidavit before this Court that there has been total compliance regarding rehabilitation in respect of those persons who come to Karnataka and when that affidavit is filed.
the matter should be placed before us for a further direction by way of a Civil Miscellaneous proceeding.
That matter should be listed before this Court on 36th October, 1988.
We can only at this stage administer the warning that the matter shall be very strictly viewed in the event of continued failure.
We must record our appreciation for the assistance rendered by Mr. Lakshmidhar Mishra as also the management of AWARE.
Report given by AWARE is indicative of how objective and at the same time informative can the social activists be when entrusted with this type of work.
Gandhiji once said: PG NO 361 "The earth has enough for every man 's need but not for every man 's greed. " The employer who employs the bonded labour should remember this statement of the Father of the Nation.
We make no directions for costs at this stage.
No separate orders are necessary in the connected writ petitions.

summary:
Section 4 of the abolishes the bonded labour system and states that on commencement of the Act every bonded labourer shall stand freed and discharged from any obligation to render any bonded labour.
The Secretary of a social organization in Tamil Nadu wrote a letter to the Court alleging prevalence of bonded labour in stone quarries in several districts of Andhra Pradesh.
This letter was registered as a writ petition.
Three other similar applications were also received and registered as writ petitions.
During the pendency of the petitions, the court passed certain interlocutory orders.
In the first order the Court directed the District Magistrate, Hyderabad and a representative of a social organisation (AWARE) to visit the site and make a report to the court within two weeks.
In the next order the court asked the respondent State of Andhra Pradesh to file an affidavit showing how many bonded labourers had been identified and released since 1.1.1983 and whether they had been rehabilitated and if so, in what manner and if there is a follow up action.
If not rehabilitated then what steps were being taken by the State to do so.
It was also directed that Vigilance Committees be set up and a member of social organizations may also be included as a member in each committee.
After the District Judge submitted his report the Court asked the State Government to take further steps and see that several relevant labour laws applicable to labour PG NO 346 PG NO 347 working in stone quarries are fully implemented.
The Court also directed that a Joint Secretary of the Ministry of Labour, Government of India should visit the relevant stone quarries to hold an enquiry for the purpose of ascertaining whether there was existence of bonded labour and whether the several relevant mines laws and labour laws were being observed.
After the receipt of the report of the Joint Secretary, the Court directed the State of Andhra Pradesh to carry out the suggestions and recommendations made in the said report and to file an affidavit setting out what steps and measures have been taken by the State Government on the recommendations made by the Joint Secretary.
The Court also issued notice to the Central Government to take steps to ensure that the provisions of the Mines Act and the connected laws are observed in the stone quarries.
As a result of the action taken by the Court about 2200 bonded labourers were freed.
The State of Andhra Pradesh arranged for their transport to their homes situated in the States of Orissa, Karnataka and Tamil Nadu.
The State Governments of these three States were directed to take further steps for the rehabilitation of the bonded labourers and submit a report to the Court.
Pursuant to this direction the State of Orissa submitted a report showing how these persons were rehabilitated by providing assistance to them.
The State of Tamil Nadu also filed a report after repeated directions and stated the measures being taken by them for rehabilitation of these labourers.
However, in spite of repeated directions the State of Karnataka did not cooperate in filing an affidavit showing how they have rehabilitated the freed bonded labourers.
The Court while disposing of the writ petitions and giving some more time to the State of Karnataka to do the needful.
HELD/OBSERVED:Detailed provisions have been made for extinguishment of liability to repay bonded debt, implementing authorities have been set up, vigilance committees have been provided, resort to bonded labour has been made an offence and steps for rehabilitation have also been indicated.
Laws, however beneficial they may be, are difficult to be implemented unless the requisite social consciousness has grown.
The system of Bonded Labour has prevailed in this Country for centuries.
The gap in economic conditions has been the main cause for this.
[358F G] The society envisaged under the constitutional set up can no more take bonded labour as a part of it.
Every citizen must be prepared to accept every other citizen as a person equal to him for enjoying the social benefits and the guarantees provided under the Constitution.
It must, PG NO 348 herefore, become a conscious obligation of every must, therefore, become a conscious obligation of every employer not to take advantage of the economic disability of a brother citizen and force him into the system of Bonded Labour.
It must equally be the obligation of every citizen to cooperate in bringing about abolition or what is condemned by the laws as Bonded Labour; otherwise, the beneficial legislation would remain on paper with mere a statutory declaration of abolishing bonded labour as provided in section 4 and yet continue to prevail unabated in the community.
[359D F] Bandhua Mukti Morcha vs Union of lndia; , , referred to.
Twelve years have passed since the law came into the Statute Book and surprisingly it came 26 years after the Constitution came into force.
In 38 years under the Constitution, we have not been able to generate appropriate attitudes and dispositions to live amicably in the polity.
Instead of appropriate consciousness manifesting itself contra indica tions have widely appeared.
Even those on whom the Statute casts the responsibility of implementing the provisions of the Act do not appear to be in a situation to respond.
It is difficult for the Court to entertain repeated complaints of this type and devote attention by way of monitoring the administration of the Act, as has been in this case.
We are surprised that about three years were necessary to persuade the State of Andhra Pradesh (Where bonded labour was identified and from where repatriation was necessary) and the states of Karnataka, Orissa and Tamil Nadu where rehabilitation was to be provided to perform their statutory obligations.
[360A C]


judgement:
Appeal No. 34 of 1957.
Appeal from the judgment and order dated August 31, 1955, of the Labour Appellate Tribunal of India, Calcutta in Appeal Nos.
Cal 187 & Cal 188 of 1954, arising out of the Award dated May 15, 1954, of the 328 Industrial Tribunal, Assam in Reference No. 20 of 1953 published in the Assam Gazette dated June 16, 1954.
C.B. Aggarwala and K. P. Gupta for the appelants.
P.K. Goswami, section N. Mukherjee and B. N. Ghosh, for the respondent.
March 31.
The Judgment of the Court was delivered by KAPUR J.
In this appeal brought by special leave against the order of the labour Appellate Tribunal, Calcutta dated August 31, 1955, the controversy between the parties is confined to the question of bonus.
The appellants are the workmen including members of the Indian staff and artisans employed by the respondent, the Assam Co. Ltd., a company incorporated in the United Kingdom and engaged in tea, industry in the State of Assam.
The appellants claimed bonus for the years 1950, 1951 and 1952 at the rate of 6 months ' wages per year.
The respondent offered to the Indian staff excluding the artisans Rs. 51,061 as bonus for 1950, Rs. 48,140 for 1951 and Rs. 15,493 for 1952 which works out at 2.3% of the net profit for the year 1950, 3.1 % for the year 1951 and 3.9 % for the year 1952.
This dispute was referred to the Industrial Tribunal by a notification of the Assam Government dated August 27, 1953.
The Industrial Tribunal allowed depreciation as given in the company 's balance sheets for the three years and allowed as return on the paid up capital and on the reserve 7% and 5% respectively and held the artisans also to be entitled to bonus.
For the purpose of mode of payment the Industrial Tribunal accepted the " unit scheme" under which the company had been paying bonus since the year 1926.
It was of the opinion that the scheme was fair and rational and gave incentive to industrial efficiency and to production.
Both the appellants and the respondent appealed against this order, the former as to the correctness of 329 the accounts, the amount of the return on capital and reserves and the " unit scheme " and again claimed six months ' wages per year as bonus.
The latter appealed against the percentages allowed on the capital and the reserves and claimed 10% and 8% respectively as a fair return.
It objected to the inclusion of the artisans amongst the workmen eligible for bonus and also to the application of what is known as the Bombay formula to Tea industry.
The Labour Appellate Tribunal varied the Tribunal 's award and allowed depreciation at the rate allowable under the Indian Income Tax Act, confirmed 7% on the paid up capital but raised the return on the reserves from 5% to 6% in order to meet the claim of the company for rehabilitation which though not claimed before the Industrial Tribunal, was put forward before it as a basis for increase in return on reserves.
In this Court the appellants again repeated their objection to the amount of depreciation, the return on capital and on reserves and to the " unit scheme " but were prepared to confine their claim to two months ' was as bonus.
Counsel for the respondent objected to the applicability of the formula to an industry like the 'tea industry, his contention being that circumstances and considerations applicable to the textile industry cannot apply to Tea industry which, being connected with agriculture, is affected by various factors which must be taken into consideration in the matter of depreciation, return oil capital and return on reserves.
The principles on which the ascertainment of the surplus on the basis of which bonus becomes determinable and distributable have been laid down by this Court in Sree Meenakshi Mills vs Their Workmen The formula there laid down is: " Distributable surplus has to be ascertained after providing from the gross profits for (1) depreciation, (2) rehabilitation, (3) return at 6 per cent.
on the paid up capital (4) return on the working capital at a lesser but reasonable rate, and (5) for an estimated amount in respect of the payment of income tax." (1) ; 42 330 Under this formula the depreciation allowable in cases arising under the Industrial Disputes Act is the normal depreciation including shift depreciation.
We did not understand counsel for the respondent to contend that there was anything in the formula which was wrong in principle but that it had to be adjusted to suit the circumstances of the Tea industry.
No circumstances, were however, given by him which would make it unfair to apply the formula nor were any figures or particulars furnished for varying it in regard to depreciation.
The Industrial Tribunal allowed 7% return on capital as against 6% held allowable under the formula.
Its reasons for this increase were : That the tea industry here may have often to face various adverse circumstances more adverse than those that may come upon other industries and may have more risks than other industries.
It may however be noted that the company in the instant case is more than a Century old one faring well all through and has thus been so far a prosperous one and on a sound footing and as such it is expected to have built up a substantial reserve.
" The Labour Appellate Tribunal maintained this higher rate of return on capital on the ground " of its being exposed to greater risks than any other industry namely weather, pests in the plants and gradual deterioration of the soil over which no man has any control These additional risk factors are no doubt present in an industry connected with agriculture like the tea industry and in our opinion they justify the giving of a higher rate of return on capital.
Instead of 4% allowed by the formula the industrial Tribunal fixed the return on reserves at 5% on the ground of its being sufficient to guard the interests of the company but the Labour Appellate Tribunal increased it to 6% to meet replacements and rehabilitation charges since the " usual method of calculating these charges is not possible in the present case " and, " we are to see that the industry does not.
suffer for want of replacement and rehabilitation funds and must 331 provide such funds in some other way, namely, by allowing a return on the working capital at higher rates ".
In the absence of any claim in the respondent 's Written Statement for rehabilitation or any figures for determining this amount, this extra one per cent.
is insupportable.
It is not a case where a claim could not be made or figures could not have been given at the proper stage.
The additional one per cent.
cannot therefore be allowed.
In our opinion the reasons given by the Industrial Tribunal sufficiently support the giving of 5% on the reserves as being fair considering the risks of the tea industry which is exposed to various adverse circumstances and elements.
The Industrial Tribunal has not acted unreasonably nor in disregard of any accepted principles in calculating the return on reserves at 5% and we see no cogent 'reason for varying this rate.
The respondent has, since 1926, been paying bonus to its employees according to a scheme called the " unit scheme " which according to the Industrial Tribunal has the merit of being more rational and gives incentive to industrious habits and efficiency loading to more production.
The Labour Appellate Tribunal did not go into the merits of the scheme but ordered payment according to it.
Under this scheme units are credited to each workman, taking into consideration the importance of the job he holds, the wages he gets and the number of years he has been employed in that particular job.
The value of units so awarded thus vary commensurate with considerations of efficiency and experience.
The establishment is divided into twelve categories and the medical staff into three each based on the relative importance of the nature of work done by a workman.
Thus in the descending order of their importance the jobs are classified as: 1.
Head Mohori; 2.
Head Clerk; 3.
Divisional Mohori ; 4.
Land Mohori; Hazaria Mohori; 5.
Kamjari Mohori; 6.
Godown Mohori; 7.
2nd Tea House Mohori; 2nd Kerani; 2nd Hazaria Mohori; 8.
2nd Godown Mohori; 9.Gunti Mohori; 10.
3rd Tea House Mohori; 11.Mondal; 12.
Apprentices.
Units would thus be awarded to workmen in the 332 particular category they are in and the more qualified the worker the better his work and the higher his wage, the higher the number of units he would be entitled to.
The amount available for distribution as bonus is divided by the aggregate number of units of all the workmen participating in the scheme and each worker would be entitled to a multiple of the amount payable on one unit and the units to his credit.
It appears to us that the estimate of the Industrial Tribunal as to the suitability of the scheme was fully justified and payment of bonus in accordance with this scheme will not only result in fair distribution of bonus but would also lead to improvement in the quality and quantity of work.
This scheme is not to be confused with production bonus though it has the merit of combining the fair distribution of the surplus available and the maintenance of efficiency in the establishment.
Taking the figures on the basis of the award made by the Industrial Tribunal we find that Rs. 7,64,608 would be the surplus for the year 1950, Rs. 77,823 for 1951 and a deficit of Rs. 10 lacs for the year 1952.
The total sum available for three years will be nil.
On the basis of the claim which counsel for the appellant has made before us, i. e., two months ' wages, we find that the amount of bonus required for the members of the staff for the year 1950 will be one sixth of Rs. 4,63,095 and for the year 1951, one sixth of Rs. 4,83,893 and for 1952 one sixth of Rs. 5,31,202 which works out to Rs. 77,182 for 1950, Rs. 80,647 for 1951 and Rs. 88,533 for 1952.
The amounts required for the artisans further increase these figures.
No doubt on the calculations which have now been made the appellant may justify the claim of two months ' bonus for the year 1950 but the same cannot be said in regard to It )he claim for the years 1951 and 1952 because of the available surplus which is only Rs. 77,823 for 1951 and there is a deficit of about 10 lacs of rupees for the year 1952.
Taking all these figures into consideration, we are of the opinion that the amounts awarded by the Industrial Tribunal are fair and proper.
As the Labour Appellate Tribunal 333 allowed depreciation and rehabilitation on an erroneous basis, we would set aside the order of the Labour Appellate Tribunal and would restore that of the Industrial Tribunal with this modification that the Respondent shall make available the additional amount required for payment of the proportional bonus to the artisans.
The appeal is, therefore, allowed to this extent, the order of the Labour Appellate Tribunal set aside and the award of the Industrial Tribunal restored with this modification that the respondent shall also provide an additional amount for these three years for payment to the artisans of proportionate bonus on the basis of the " Unit System ".
As neither of the parties have succeeded in their main contentions, the fair order in regard to costs should be that the parties do bear their respective costs throughout.

summary:
The appellants claimed bonus for the years 1950, 1951 and 1952 at the rate of six months ' wages per year.
The Industrial Tribunal to which the dispute was referred allowed, in calculating the surplus available for payment of bonus, inter alia return on paid up capital and on the reserves at 7% and 5% respectively and accepted the " unit scheme " of payment of bonus which the company had been following since 1926.
Under this scheme units were credited to each workman taking into consideration the importance of the job he held, the wages he got and the number of years he had been employed in that particular job, and each workman was paid bonus in proportion to the units to his credit.
On appeal the Labour Appellate Tribunal modified the award and raised the return on the reserves from 5% to 6% : Held, that the formula laid down in Sree Meenakski Mills vs Their workmen, ([1958] S.C.R. 878 at 884) for ascertaining the surplus on the basis of which bonus becomes determinable and distributable could be applied to the tea industry with suitable adjustments.
The allowing Of 7% return on capital as against 6% held allowable under that formula was justified by the additional risk factors in the tea industry.
The allowing Of 5% return on reserves by the Industrial Tribunal as against 4% allowed by the formula was not unreasonable, it being sufficient to safeguard the interests of the company.
But the increasing of this to 6% by the Appellate Tribunal was insupportable in the absence of any claim in the respondent 's written statement for rehabilitation or ,of any figures for determining this amount.
The " unit scheme " was suitable for the payment of bonus and would result not only in the fair distribution of bonus but would also lead to improvement in the quality and quantity of work.