judgement:
Appeal No. 188 of 1961.
Appeal by special leave from the judgment and order dated September 11,1959, of the Industrial Tribunal, Punjab, Patiala in Reference No. 30 of 1957.
G.S. Pathak, J. B. Dadachanji, O. C. Mathur and Ravinder Narain, for the appellants.
Bawa Shivcharan Singh and Janardan Slwrma for the respondents.
February 8.
The Judgment of the Court was delivered by VENKITARAMA AIYAR, J.
This is an appeal by special leave against the Order of the Industrial Tribunal, Punjab, dated September 11, 1959, in Reference No. 30 of 1957, overruling certain preliminary objections raised by the appellant to the 91 jurisdiction of the Tribunal to hear the reference.
The facts are that on February 14,,1955, the Government of Punjab referred under section 10(1)(c) of the , hereinafter referred to as "the Act", certain disputes between the appellant and the respondents to the Industrial Tribunal Punjab, Jullundur, for adjudication. ' That was numbered as Reference No. 3 of 1955.
This Tribunal had been constituted on August 29, 1953, by a Notification issued by the Government of Punjab, which is as follows "In exercise of the powers conferred under section 7 of the (Act XIV of 1947), the Governor of Punjab, in consultation with the Punjab High Court, is pleased to appoint Shri Avtar Narain Gujral 'Advocate, as Industrial Tribunal 'for Punjab.
" The main contention pressed before us on %behalf of the appellant is that Shri A.N. Gujral was 'not qualified under section 7(3)(c) of the Act under which the Notification was issued to be appointed as Tribunal on August 29, 1953, as he was very sixty years of age on that date, having been born on June 4, 1 892, and that there was therefore no Tribunal validly constituted in existence, and that in consequence the reference, to that so called Tribunal on February 14, 55, was wholly inoperative.
While Reference No. 3 of 1955 was pending before the Tribunal, the provisions of the , were amended by the Industrial Dispute (Amendment and Miscellaneous Provisions) Act, 1956 (Act No. 36 of 1956), which came into force on March 10, 1957.
This Amendment Act repealed section 7 of the principal Act, and replace it by sections 7A, 7B and 7C. Section 30 of the Amendment Act contains a saving as regards proceedings in relation to any industrial dispute which had been pending before a Tribunal constituted under the principal Act.
Acting under this section, the 92 Punjab Government issued on April 19, 1957, the following Notification : "No. 4194 0.
Lab 57/652 RA In continuation of Punjab Government Memorandum No. 3078 C Lab 57/4224, dated the 1st/llth March, 1957, and in exercise of the powers conferred by section 7 of the , as in force before the commencement of the Industrial Disputes (Amendment and Miscellaneous Provisions) Act, 1956, read with Section 30 of the latter Act and all other powers enabling him in this behalf the Governor of Punjab is pleased to extend (a)the period for which the Industrial Tribunal, Punjab, Jullundur, is constituted, and (b)the term of appointment of the Role Member thereof.
up to the last day of October, 1957, or such date as the proceedings in relation to industrial disputes pending in the said Tribunal immediately before the 10th March, 1957, are disposed of, whichever is earlier." To put it briefly, this Notification extended the life of the Tribunal constituted under the repealed section 7, for the period specified therein, and it also continued the term of Shri A,N. Gujral, as a Member thereof, for the said period.
The contention of the appellant with reference to this Notification is that section 30 of Act 36 of 1956 does not authorise the appointment of a Member to the Tribunal constituted under section 7, and that the Notification in so far as it continued Sbri A.N. Gujral.
as a Member of the Tribunal after his term of office had expired on Mach 10, 1957, was unauthorised and void.
93 On the same date on which the above Notification was issued, that is on April 19, 1957, the Government of Punjab issued a Notification under section 7A of the Act of which the relevant portion is as follows : "No. 4194 C Lab 57/66t RA In exercise of the powers conferred by Section 7A of the Industrial Disputes Act, 1917, as inserted by section 4 of the Industrial Disputes (Amendment and Miscellaneous Provisions) Act , 1956, (No. 36 of 1956), and all other powers enabling him in this behalf, the Governor of Punjab is pleased to constitute an Industrial Tribunal with Headquarters at Jullundur and to appoint Shri Avtar Narain Gujral, B.A., LL.B., as its Presiding Officer with effect from the date of the publication of this notification in the Official Gazette up to 3rd June, 1957.
" It will be noticed that this Notification firstly constituted a now Tribunal being the Industrial Tribunal, Jullundur, and secondly it appointed Shri A. N. Gujral as its Presiding Officer 'up to June 3, 1957.
The significance of that date is that, under section 7C (b) enacted by the Amendment Act, 1956, the age of retirement for members was fixed at sixty five, and under that provision, Shri A.N. Gujral would have to retire on June 3, 1957.
The Punjab Legislature intervened at this stage and enacted two statutes which are material for the present dispute.
One of them was the Industrial Disputes (Punjab Amendment) Act 8 of.
Section 3 of this Act amended section 7C (b) of the principal Act by substituting for the words "he has attained the age of sixty five years", the words "he has attained the the age of sixty seven years".
Thus the age of retirement was raised to sixty seven years.
By the operation of this Act, the tenure of Shri A. N. Gujral could be extended from 94 June 3, 1957 to June 3, 1959, and that in fact was done by a number of Notifications issued from time to time.
The appellant contends that this legislation was intended to benefit a single individual Shri A.N. Gujral, and is therefore void as offending article 14 of the Constitution.
The result, according to the appellant, is that after June 3, 1957, there was no one validly holding the office of Member of the Industrial Tribunal.
The second statute enacted by the Punjab Government is the Industrial Disputes (Amendment and Miscellaneous Provisions) (Punjab Amendment) Act 9 of 1957.
It introduced in section 30 of the Amendment Act, 1956, a new sub section (2) conferring on the ,State Government authority to re constitute Tribunal established under the , where those Tribunals had come to an end and there were matters pending before them for adjudication.
Going back to the Tribunal which was constituted under the repealed section 7 of the Act it will be remembered that a Notification had been issued on April 19, 1957, under section 30 of the Amendment Act, 1956, keeping it alive until the pending matters were dis posed of or until October 31, 1957, whichever was earlier.
The expectation that the proceedings before that Tribunal would be completed by that date was however, not realised and therefore acting under section, 33B (1) of the Act, and section 30 of the Amendment Act 1956, as further amended by Punjab Act, 9 of 1957.
the Government of Punjab issued on October 31, 1957 a Notification transferring the matters pending before the old Tribunal constituted under section 7 to the new Tribunal constituted on April 19, 1957, under section 7A.
In accordance with this Notification, Reference No. 3 of 1955 was transferred to the new Tribunal and was renumbered as 30 of 1957.
The contentions urged by the appellant against this order of transfer are, firstly, that the Tribunal to which the transfer had been made was not, for the reasons already given, validly constituted and had no legal existence, and, 95 secondly, that the new provision introduced by the Punjab Act 9 of 1957 has no retrospective operation and that, in consequence, the proceedings which had been pending before the old Tribunal on March 10, 1957, could not be transferred to the new Tribunal under this section.
The present reference 30 of 1957 was pending till June 3, 1959, when Sbri A.N. Gujral retired.
The Punjab Government then issued a Notification appointing Sri Kesho Ram Passey, retired Judge of the Punjab High Court as the Presiding Officer of the Industrial Tribunal, Jullundur.
Before him, the present appellant filed an application on September 4, 1959, raising a number of preliminary objections to the hearing of the reference.
By its Order dated September 11, 1959, the Tribunal overruled these objections and posted the. matter for hearing on the merits.
It is the correctness of this Order that is DOW challenged before us in this Appeal.
Though a number of objections were raised to the bearing of the rieference be,.fore the Tribunal, the contentions advanced before us for the appellant are the following : (1) Shri A. N. Gujral was riot qualified to be appointedto the Tribunal under section 7(3)(c) of the Act that, in consequence, the reference to him dated February 14, 1955, was incompetent; (2)that the Notification.
of the Punjab Government dated April 19, 1957 appointing Shri A. N. Gujral as a Member of the Industrial Tribunal, Juilundur, and the subsequent Notifications extending bis tenures of office are unauthorised and inoperative; (3)that the Notification of the Punjab Government dated Ootober 31, 1957, transferring the proccedings.
pending before the old Tribunal to the new Tribunal was inoperative, because (i) the Punjab Act 8 of 1957 is void being repugnant to article 14 of the, Constitution and the appointment of Shri A. N. Gujral as Member under that Act is also void; 96 and (ii) section 30(2) enacted by Punjab Act 9 of 1957 under which the transfer was made, did not authorise transfer of proceedings, which had been pending on or before March 10, 1957.
(1) Taking up first the, contention that Shri A. N. Gujral was not qualified to be appointed to the Tribunal on August 29, 1953, by reason of the fact that he was over sixty years of age, the question is one of interpretation of the language of section 7(3)(c) of the Act.
Section 7, in so far As it is material for the present purpose, is as follows: "7.
Industrial Tribunals. (1) The appropriate Government may constitute, one or more Industrial Tribunals for the, adjudication o f industrial disputes in accordance with the provisions of this Act.
(2)A Tribunal shall consist of such number of independent members as the appropriate Government may think fit to appoint,, and where the Tribunal consists of two or more members, one of them shall be appointed as the Chairman thereof.
(3)Where a Tribunal consists of one member only, that member, and where it consists of two or more members, the Chairman of the Tribunal, shall be a person who (a)is or has been a Judge of a High Court; or (b) is or has been a District Judge or (c) is qualified for appointment as a Judge of a High Court: Provided that no appointment under this subsection to a Tribunal shall be made of any person Dot qualified under clause (a) or (b) except with the approval of the High Court of 97 the State in which the Tribunal has, or is intended to have its usual seat." Shri A. N. Gujral was appointed under section 7(3)(c) being an Advocate.
The question is, whether he was then qualified for appointment as a Judge of a High Court under that clause.
The Constitutional provision hearing on this point is article 217, which in so far as it is material is as follows : "217.
(1) Every Judge of a High Court shall be appointed by the President by warrant under his hand and seal after consultation with the Chief Justice of India, the Governor of the State, and, in the case of appointment of a Judge other than the Chief Justice, the Chief Justice of the High Court, and shall hold office in the case of an additional or acting Judge, as provided in article 224, and in any other case until he attains the age of sixty years; Provided that. . . (2)A person shall not be qualified for appointment as a Judge of a High Court unless he is citizen of India and (a) has for at least ten years held an Judicialoffice in the territory of India, or (b) has for at least ten years been a advocate of a High Court or of two or more such Courts in succession.
Explanation. .
While article 217 (2) prescribes the qualifications for appointment as a Judge, article 217(1) lays down that the Judge shall hold office until he attains the age of sixty years.
The whole of the controversy before us is as to the inter relation between these two clauses.
The contention of Mr. Pathak, learned counsel for the appellant, is that though article 217 (1) refers, in terms, to the termination of the office of Judge, in substance, it lays down a 98 qualification for appointment, because the appointment of a person over sixty as a Judge would clearly be repugnant to article 217(1) even though he might satisfy all the requirements of article 217(2).
It is accordingly argued that it is an implied qualification for appointment as a Judge under article 217 that the person should not have attained the age of sixty at the time of the appointment.
We agree that there is implicit in article 217(1) a prohibition against appointment as a Judge of a person who has attained the age of sixty years.
But in our view, that is in the nature of a condition governing the appointment to the office not a qualification with reference to a person who is to be appointed thereto.
There is manifest on the terms and on the scheme of the article a clear distinction between requirements as to the age of a person who could be appointed as a Judge and his fitness based on experience and ability to fill the office.
article 217(1) deals with the former, and, in form, it has reference to the termination of the office and can therefore be properly read only as imposing, by implication a restriction on making the appointment.
In strong contrast to this is article 217(2) which expressly refers to the qualifications of the person to be appointed such as his having held a judicial post or having been an Advocate for a period of not less than ten years.
We think that on a true construction of the article the prescription as to age is a condition attached to the duration of the office and not a qualification for appointment to it.
Mr. Pathak also relied on articles 224 and 376 as lending support to his contention that age is to be regarded as an implied qualification under article 217.
article 224 relates to the appointment of additional and acting Judges and it is provided in els.
(1) and (2) that the person to be appointed as additional or acting Judge by the President should be a duly qualified person.
There is nothing about the age of the person to be appointed in these clauses.
99 That is provided in article 224(3) when enacts that no person appointed as an additional or acting Judge of a High Court shall hold office after attaining the age of sixty years.
" This article is also framed on the same lines as article 217 and does not carry the matter further.
Nor is there anything in article 376 which throws any further light on this point.
It has reference to persons who were Judges in the High Courts of the States specified in part of the First Schedule at the time when the Constitution came into force, and provides that they shall become Judges of the High Courts in those States under the Constitution, and then enacts a special provision that they "shall notwithstanding anything in clauses (1) and (2) of article 217 but subject to the proviso to clause (1) of, that article, continue to hold office until the expiration of such period as the President may by order determine.
" We see nothing in the terms of this article which lends any support to the contention that age is to be regarded as a qualification.
More to the point under consideration is article 165 (1) that the ",Governor of each State shall appoint a person who is qualified to be appointed as a Judge of a High Court to be Advocate General for the State.
" The question has been discussed whether on the terms of this article" a person who has attained the age of sixty could be appointed as an Advocate General.
If the age of a person is to be regarded as one of his qualifications, then he could not be.
The point arose for decision in G. D. Karkare vs T. L. Shevde (1), where a Judge who had retired at the age of sixty had been appointed as Advocate General.
The validity of the appointment was challenged on the ground that he was disqualified by reason of his age.
The learned Judges of the Nagpur High Court held that cl.
(1) of article 217 of the Constitution prescribed only the duration of the appointment of a Judge of the High Court and could not be construed (1) I. L.R. [1952] Nas.
409. 100 as prescribing a qualification for his appointment.
It is argued for the appellant that the appointment of an Advocate General under article 165 might stand on a different footing from that of a Judge under article 217.
because of the special provision in article 165(3) that the Advocate General is to hold office, at pleasure, whereas a Judge holds office during good behavior.
But this difference bears only on the power of the appropriate authority to terminate the appointment and not on the qualification of the person to be appointed to the office.
In our view, the interpretation put upon article 217 in G. D. Karkare 's case (1) is correct.
Though the true meaning of article 217 has figured largely in the argument before us, it is to be noted that we are primarily concerned in this appeal with the interpretation of section 7(3)(c) of the Act, and that must ultimately turn on its own context.
Section 7(3)(a) provides for the appoint ment of a High Court Judge, sitting or retired, as a Member of the Tribunal.
Age is clearly not a qualification under this sub clause, as the age for retirement for a Judge of the High Court is sixty.
Likewise, el.
(b) provides for the appointment of a District Judge, setting or retired, as a Member.
A retired District Judge who is aged over sixty will be eligible for appointment under this subclause.
Thus the age of a person does not enter into his qualifications under sub cls.
(a) and (b).
It would therefore be legitimate to construe sub el.
(c) as not importing any qualification on the ground of age.
But it is said that sub cls.
(a) and (b) form a distinct group having reference to judicial officers, whereas, cl.
(c) is confined to Advocates, who form a distinct category by themselves, and that in view of this difference, considerations as to age applicable to cl.
(a) and (b) need not be applicable to el.
There is undoubtedly a distinction (1) I. L. R.[1952] Nag. 409. 101 between cls.
(a) and (b) on the one hand and c1.
(c) on the other.
But the question is whether this has any reasonable relation to the difference which is sought to be made between the two classes with reference to the age of appointment.
If a retired Judge of the age of sixty can fittingly fill the office of a Member of the Tribunal under section 7, an Advocate of that age can likewise do so.
In our view, there is no ground for importing in section 7(3)(c) an implied qualification as to age, which is not applicable to el.
7(3)(a) and (b).
This question was considered by a Bench of the Punjab High Court in Prabhudayal vs State of Punjab (1).
There the validity of the appointment of Shri A. N. Gujral under the notification dated August 29, 1953, which is the very point now under debate, was challenged on the ground that as he was over sixty on that date, he was not qualified to be appointed under section 1 (3)(c).
The Court held approving of the decision in G. D. Karkare 's case (2), that the prescription as to age in article 217 (1) was not a qualification to the office of a Judge under article 217(2), and that a person who was more than sixty was qualified for appointment under section 7(3)(c).
Reliance is placed for the appellant on the terms of section 7C which was substituted by the Amendment Act 36 of 1956 in the place of section 7 as supporting the contention that age is a qualification for appointment under section 7(3) (c).
Section 7C is as follows : "No person shall be appointed to, or continue in, the office of the presiding officer of a Labour Court, Tribunal or National Tribunal, if (a) he is not an independent pet son or (1) A. 1.
R (2) 1.1 R.[1952] Nag.
409. 102 (b) he has attained the age of sixty five years ' " The marginal note to that section which was also relied on is as follows : " Disqualifications for the presiding officers of Labour Courts, Tribunals and National Tribunals.
" The argument of the appellant is that, in prescribing the age as a qualification under section 7C, the Legislature only made explicit what was implicit in a. 7(3)(c), and that therefore the qualification on the basis of age should also be imported in section 7(3)(c).
This inference does not, in our opinion, follow.
The insertion of age qualification in section 7C is more consistent with an intention on the part of the Legislature to add, in the light of the working of the repealed section 7, a new provision prescribing the age of retirement for Members.
We agree with the decision of the Punjab High Court in Prabhudayals case (1) and hold that section 7 (3) (c) does not import any qualification based on the age of the person to be appointed, and that the appointment of Shri A. N. Gujral on August 29, 1953, was valid under a. 7(3)(c).
(2)The next contention advanced for the appellant is that the Notification dated April 19, 1957, appointing Shri A. N. Gujral as a Member of the Tribunal issued under section 30 of the Amendment Act 36 of 1956 was not authorised by the terms of that section and that therefore there was no validly constituted Tribunal from that date.
Section 30 is as follows : "Savings as to proceedings pending before Tribunals : If immediately before the commencement of this Act there is pending any proceeding in relation to an Industrial dispute before a Tribunal constituted (1) A. I. R. [1959] Punj 460.
103 under the (14 of 1947), as in force before such commencement, the dispute may be adjudicated and the proceeding disposed of by that Tribunal after such commencement, as if this Act had not been passed.
" The contention urged before us is that section 7 under ,Which Shri A. N. Gujral had been constituted Tribunal was repealed on March 10, 1957, the notification dated April 19, 1957, appointing him as a Member of the Tribunal is void.
There is no substance in this contention.
Section 30 expressly provides for the life of the Tribunal being extended for the period specified therein, and that necessarily implies a power to continue Shri A. N. Gujral as the Tribunal, and we should add that in view of our decision on point No. 3 this objection is practically of no importance.
(3)Lastly, it is contended that the transfer of the proceedings pending before the old Tribunal to the new Tribunal under the Notification dated October 31, 1957, was invalid and inoperative.
Two grounds were urged in support of this contention.
One is that Shri A.N. Gujral attained the age of sixty five on June 4, 1957, and his term of office would have then expired under s.7C.
Then the Punjab Legislature enacted Act 8 of 1957 raising the age of retirement under s.70(b) from sixty five to sixty seven.
That was with a, view to continue Shri A.N. Gujral in office.
And this legislation came into force only on June 3, 1957.
This Act, it is said offends article 14 as its object was to benefit a particular individual, Shri A.N. Gujral, and reference was made to a decision of this Court in Ameeroonissa vs Mehboob (1) as supporting this contention.
There is no force in this contention.
There the legislation related to the estate of one (1) ; 104 Nawab Waliuddoula, and it provided that the claims of Mahboob Begum and Kadiran Begum, who claimed as heirs stood dismissed thereby and could not be called in question in any court of law.
And this Court held that it was repugnant to article 14, as it singled out individuals and denied them the right which other citizens have of resort to a court of law.
But the impugned Act, 8 of 1957 is of general application, the age being raised to sixty seven with reference to all persons holding the office under that section.
The occasion which inspired the enactment of the statute might be the impending retirement of Shri A. N. Gujral.
But that is not a ground for holding that it is discriminatory and contravenes article 14, when it is, on its terms, of general application.
The second ground of attack against the order of transfer is that it is not competent under s.30(2) of the Amendment Act 36 of 1956 as further amended by the Punjab Act 9 of 1957.
Section 30(2) is as follows : "If immediately before the commencement of this Act there was pending any proceeding in relation to an industrial dispute before a Tribunal constituted under the , as in force before such commencement and such proceeding could riot be disposed of by that Tribunal due to the Tribunal having come to an end on the expiry of the period for which it was constituted, the State Government may reconstitute that Tribunal for adjudicating that dispute and disposing of that proceeding after such commencement as if this Act had not bee n passed, and the proceeding may be continued by that Tribunal from the, stage at which it was left.
" 105 The contention urged before us is that this provision has no retrospective operation and that in consequence the proceedings which had been pending before the old Tribunal on March 10, 1957, could not be transferred to the new Tribunal under this section.
This contention is clearly untenable, because the whole object of s.30(2) is to provide for the hearing of disputes which were pending before the old Tribunal, and its operation is entirely retrospective.
This contention must there.
fore be rejected.
In the result, the repeal fails and is dismissed with costs.
Appeal dismissed.

summary:
On February 14, 1953, the Government of Punjab referred certain disputes between the appellant company and its workmen to the Industrial Tribunal which had been consti tuted on August 29, 1953, by a notification issued under section 7 of the industrial Disputes Act, 1947, by which G, an Advo cate, was appointed as the Industrial Tribunal for Punjab.
When the reference was pending the Act was amended.
The Amendment Act inter alia repealed section 7 of the principal Act and replaced it by sections 7A, 7B and 7C, and by section 30 provided for a saving clause in respect of the proceedings pending before the Tribunal constituted under the principal Act.
On April 19, 1957, the Punjab Government issued a notification under section 7 of the Act and section 30 of the Amendment Act extending the life of the Tribunal constituted under the repealed section 7 and also extending the term of G as the member.
On the same date another Notification was issued under section 7A of the Act constituting a new Tribunal and appointing G as the Presiding Officer up to June 3, 1957.
Under section 70 (b) the age of retirement for members was fixed at sixty five and under that provision G would have to retire by June 3, 1957.
The Punjab Government intervened and passed the Industrial Disputes (Punjab Amendment) Act, 1957, raising the age of retirement of members to sixty seven years.
After G had retired on June 3, 1959, the Punjab Government issued a notification appointing another person as the Presiding Officer of the Industrial Tribunal.
The appellant challenged the legality of the reference on the grounds, inter alia, (1) that G was not qualified to be appointed to the Tribunal under section 7 (3) (c) of the Act, as he was over sixty years and, therefore, the reference to him dated 90 February 14, 1955, was incompetent, and (2) that the Indus trial Disputes (Punjab Amendment) Act, 1937, was passed with a view to benefit a single individual, G, and, therefore, was void as offending article 14 of the Constitution of India.
Held, (1) section 7(3)(c) of the , did not import any qualification based on the age of the person to be appointed, and that the appointment of G on August 29, 1953, was valid under that section.
On the true Construction of article 217 of the Constitution of India, the prescription of age therein is a condition attached to the duration of the office and not a "qualifica tion" for appointment to it.
G.D. Karkare vs T.L. Shevde, I.L.R. and Prabhudayal vs State of Punjab, A. I. R. 1959 Punj.
460, approved.
(2) the Industrial Disputes (Punjab Amendment) Act,1957,not contravene article 14 of the Constitution, because thoughthe occasion which inspired the enactment of the statutemight be to benefit an individual, it was of general application and could not therefore be held to be discriminatory.
Ameerunissa vs Mehboob; , , distinguished.


judgement:
Appeals Nos. 4 and 5 of 1962.
Appeals by special leave from the award dated January 25, 1960, of the Industrial Tribunal, Delhi in I.D. No. 40 of 1957.
A.V. Viswanatha Sastri, A. N. Sinha, and section Venkatakri,shnan for the appellant (in C.A. No. 4 of 62) and the respondent (in C.A. No. 5 of 1962).
518 A.S. B. Chari.
R. K. Garg, D. P. Singh, section C. Agarwala and M.K. , Ramamurthi for the respondents (in C.A. No. 4 of 62) and the appellants (in C.A. No. 5 of 62).
March 1.
The Judgment of the Court was delivered by WANCHOO, J.
These two appeals by special leave arise out of the same award of the Industrial Tribunal, Delhi, and will be dealt with together.
Appeal No. 4 is by the management of the D.C.M. Chemical Works while appeal No. 5 is by the workmen.
The management hereinafter will be referred to as the appellant for the purposes of both appeals and the workmen will be referred to as respondents.
A dispute arose between the parties with respect to various matters including wage scales, dearness allowance and gratuity.
As the parties could not come to terms it was referred to the industrial tribunal for adjudication and there were as many as eleven issues which were the subject matter of reference.
The main point however on which the parties differed was whether in determining the wage structure etc.
of the chemical works which is a constituent unit of the Delhi Cloth and General Mills Limited (hereinafter called the Company), the over all position of the Company should be taken into account or only the position of this one unit, namely, the chemical works.
The respondents contended that the chemical works was an integral part of the Company and therefore the over all position of the Company should be taken into account and the wage structure etc.
fixed accordingly; in particular it was pointed out that there were differences in wage structure etc.
between the various units which were controlled and owned by the Company and which were all situate in the same area in Delhi and that those differences should be eliminated and all the enterprises in Delhi controlled by the Company should be treated on the same footing.
On the other band the contention of the 519 appellant was that though the chemical works was one unit of a large number of industries controlled by the Company, some of which were situate in the same area in Delhi, the various units were independent industries and each unit had to be considered on its own, and the wage structure etc.
fixed on the basis of the financial position of each unit ;in particular, it was urged that two of the main units in Delhi were the textile mills run by the Company and the claim of the respondents that the chemical works should in all matters be treated on a par with the textile units was untenable, on the ground, among others, that it would be against the principle of industry cum region.
Before there fore we take up the particular matters raised in the two appeals before us, we shall first have to consider whether the claim of the respondents that the overall position of the Company should be taken into account in fixing the wage structure etc.
of the chemical works is sound ; for if that position is accepted, the award may have to be set aside as the tribunal has held that in the circumstances of this case the chemical works should be treated as an independent unit and that the wage structure etc.
therein cannot be fixed on the basis of the over all position of the Company.
In order to appreciate the various contentions put forward by the parties on this question it may be useful to look into the history of the Company and how it has grown.
The Company came into existence in 1889 with a modest capital of about Rs. 10 lacs.
It seems that the policy of those in control of the Company was to slough back a substantial part of the profits into the industry itself and to create a reserve for that purpose.
Originally the Company started with a textile mill but in course of time with the help of sloughed back profits and also with the aid of further capital, the Com.
pany set up a large number of other industrial 520 concerns in Delhi and elsewhere.
In Delhi itself, the Company now has the Delhi Cloth Mills, the Swatantra Bharat Mills which are both textile concerns, the D.C.M. Tent Factory established in 1940, and the chemical works with which we are concerned in the present appeals.
Besides, there are other industrial concerns owned and controlled by the Company outside Delhi, as for example, the Daurala Sugar Works established in 1932, the Lyallpur Cotton Mills in ' 1934 and the Mawans Sugar Works in 1940.
The chemical works were started in 1942 and the only line of production at that time was sulphuric acid.
In 1943, an alum plant was set up, in 1944 a soap plant, in 1945 a superphosphate plant and in 1946 a contact sulphuric acid plant.
In 1. 947 a vanaspati plant was established and also a power house was erected in order to meet the requirements of the vanaspati plant.
In 1948 49 a caustic soda plant was added so that what began as modest subsidiary to the textile mills has now expanded into a full fledged unit for production of chemicals and vanaspati.
The total capital which was originally about Rs. 10 lacs when the Company started in 1889 has now grown to Rs. 4 crores.
so the capital employed in the chemical works has always been found from the reserves of the Company and is now of the order of over a crore.
It is also not in dispute that very little out of the production of the chemical works is used in the textile mills of the Company and that by far most of the production is sold in the open market.
Further even the small part of the production that is used by other units is charged at market rates and not at cost price, so that for all practical purposes the chemical works is being run as an independent unit.
Certain features have however been pointed out by the respondents to show that the over all 521 position of the Company should be taken into account in determining the wage structure etc.
of the chemical works which should be treated as an integral part of the entire industry of all kinds carried on by the Company.
These features are : no unit has any separate paid up capital and there is no separate depreciation fund or reserve fund for each unit ; the Company publishes one balance sheet showing the total profits of all the undertakings after taking into account losses incurred in any undertaking ; the shareholders of the Company are the shareholders in all the unit,% ; the Company has got one board of directors and a common managing agency and the policy of the various units is determine on the basis of the Company as one integrated unit; the profits of the Company are all pooled together and the profits in any undertaking are not earmarked for expenditure in that undertaking; the dividends are paid from to profits of the Company as a whole; the Company has a single provident fund for all its employees in all its units and the Company has established various units from the profits earned by the Company as a whole in the past and incometax is paid on the entire profits of the Company made by all the units after taking into account the losses, if any, incurred by a particular unit.
It is urged therefore on behalf of the respondents that these features are sufficient to establish that all the different industries carried on by the Company are one integrated whole and therefore in fixing the wage structure etc.
for the chemical works this overall position should be taken into account.
There is however in our opinion a 'very cogent reply to these features pointed out on behalf of the respondents, and that is that the Company is a single limited concern owning and controlling various industrial units of different kinds under it and therefore under the Company Law as the Company is on* legal entity these features are bound to be common and may not to enough to lead to the conclusion ,that 522 the various undertakings carried on by the Company are one integrated whole and therefore when wagestructure etc.
has to be fixed in any particular.
unit the over all position of ' the Company as a whole must be taken into account.
On the other hand there are certain features which have been pointed, out by the tribunal and which are not in dispute which go to show that the Company has been treating its various units as independent concerns in actual practice.
Each unit has separate books of account and separate profit and loss account showing how each particular business is faring.
Each unit has separate muster rolls for its employees and transfers from one unit to the other, even where such transfers are possible considering the utterly different kinds of business that the Company is carrying on, usually take place with the consent of the employees concerned.
Further each unit has got its own separate wages and separate dearness allowance and other different allowances and bonus is also paid differently in each concern.
Further even where sales take place from one unit to another they take place at market rate and not at cost price and are adjusted on this basis in the books of account.
Lastly though there is a common board of directors and a common managing agency of the Company.
each unit has its own separate management as it is bound to be for the business carried on by different units is in many cases utterly different.
It is on these facts that we have to see whether the chemical works can be said to be so integrated with the other units of the Company as to justify the conclusion that it is part of the same business, and the entire business carried on the Company is one establishment, and therefore it would not be right to have different wage structure, dear_ ness allowance, etc., in the same establishment.
523 This matter was considered by this Court in connection with Jay off in The Associated Cement Companies Limited, Chaibasa Cement Works, Jhinkpani vs Their Workmen(1), where tests were laid down for determining whether a particular unit is part of a bigger establishment.
These tests included geographical proximity, unity of ownership,.
management and control, unity of employment and conditions of service, functional integrality and general unity of purpose.
But it was pointed out that it is was impossible to lay down any one test as an absolute and invariable test for all cases and the real purpose of these tests was to find out the true relation between the parts, branches, units.
If in their true relation they constitute one integrated whole, then the establishment is one ; if on the contrary they do not constitute one integrated whole, each unit is then a separate unit.
How the relation between the units will be judged must depend on the facts proved.
Thus in one case the unity of ownership, management and control may be the important test, in another case, functional integrality, or general unity may be the important test; and in still another case, the important test may be the unity of employment.
It was pointed out that in a large number of cases several tests may fall for consideration atthe same time and the difficulty of applying these tests arises because of the complexities of modern industrial organization.
The matter was considered again by this Court in Pratap Press etc.
vs Workmen (2), Pakshiraj Studios vs Workmen(3) Hony.
Secretary, South India Millowners ' Association ' vs Secretary, District Coimbatore District Textile Workmen Union (4) and Fine Knitting Co. Ltd. vs Industrial Court, Bombay(4).
In the case of Fine Knitting Co., this Court was considering one limited company but it was held in the circumstances that even though there was unity of ownership, management and control the two parts of the same concern (1) ; (3) (2) (4) C. A. 4 IQ of 1960, decided on 1 2 62.
(5) C.A. 306 of 1961.
decided on 15 2 1962.
524 different units as there was no functional integrality between them.
It is on the basis of these tests that we have to consider whether the tribunal was right in its conclusion that the chemical works has to be treated as an independent unit.
The common features which have been emphasized on behalf of the respondents are in our opinion clearly capable of explanation on the ground that the Company is a limited concern and carries on different kinds of business.
But as in law under the Companies Act, the Company being a limited concern is one legal entity, the Common features on which the respondents rely follow from that one single circumstance, namely, that the Company is a limited concern governed by the Company Law.
It would therefore in our opinion be not right to emphasis these common features and to hold on their basis only that the various businesses carried on by the Company have to be treated as one integrated whole for the purposes of wage structure etc. ' The outstanding fact in the present case is that though a large number of businesses is being carried on by the Company their nature in many cases is utterly different and one has generally speaking nothing to do with the other.
The three main lines of business which the Company is carrying on are sugar, textiles and chemicals.
It .is obvious that there is nothing common between these three different lines of business and there can be no question of one depending upon the other and there cannot be functional integrality generally speaking between these three lines of business.
There might be some connection speaking between the chemical works and the textile mills of the Company inasmuch as some of the chemicals might be used in the textile mills; but the evidence shows that a very small proportion of the chemicals produced in the chemical works is used in the textile mills and that most of the production is sold in the open market.
It cannot ' therefore be said that the chemical works as it now 525 exists is therefor the purposes of the textile mills and is thus integrated with the textile mills.
Even in the matter of employment the evidence is that there is separate recruitment of labour for the different units and each unit has separate muster rolls of employees and this is quite natural considering that different skill is required for the three lines of business carried on by the Company.
It cannot also be said that there is any essential dependence of the chemical works on the textile units or that one cannot be operated without the other.
Further the way in which the Company has been dealing with different units in the past also shows that they have been treated as independent units.
Each unit has its own separate labour union and separate agreements are entered into between the Company and its unions with respect to the conditions of service which are also different for different Units.
Even in the matter of bonus there are differences between the different units and these differences sometimes arose out of different agreements between the various units and their unions.
It appears that even in the case of units carrying on the same business, as for example, textile, the workmen themselves contended in an earlier adjudication that the Delhi Cloth Mills and the Swats Bharat Mills were two distinct and separate units of the Company.
In any case whatever may be said as to the units in the same line of business it is in our opinion perfectly clear that there is no nexus of integration between different lines of business carried on by the Company on the facts which have been proved in this case.
We are of opinion therefore that the ratio of the decision in the Fine Knitting Co. 's case(5) applies to the facts of this case and it must be held that the chemical works is an independent unit and therefore in fixing the wage structure etc.
we have to look to the position of the chemical works only and cannot (5) C.A. 306 of 1961, decided on 15 2 1962.
526 integrate it with other units and consider its wage structure etc.
on the basis of such integration.
It is in the background of the above finding, namely, that the chemical works is an independent unit that we now come to the specific points raised in the two appeals.
We shall first take the appeal by the workmen.
The following four contentions only were pressed before us on their behalf : (i)Even considering the chemical works as an independent unit, the tribunal should have fixed a wage structure including incremental scales ; (ii)The tribunal should have given the same minimum scales to the workmen employed in the canteen as are being given to the other workmen in this concern; (iii)The tribunal should have made those members of the civil engineering 'department who had been working for more than one year permanent and should have given them the same terms and conditions of service as are enjoyed by other workmen of the concern ; (iv)The tribunal should have awarded further bonus to the workmen.
(i) The contention on behalf of this respect is that there are no incremental scales in this concern and the tribunal, should have at any rate made a beginning by fixing some incremental scales for the workmen.
The tribunal however has refused to fix incremental scales on the ground that the concern has neither financial ability nor stability to justify the fixing of incremental scales at the present time.
It is not in dispute that throughout 527 the course of its existence the chemical works has made profits only in two years and that for the rest of the time it has been making losses which had to be met by the Company out of the profits of other units.
Reliance in this connection has been placed on behalf of the respondents on certain observations in the Tariff Commission Report and on a book called "Fertilizers Statistics in India" to show that the chemical industry has a very prosperous future in front of it.
Reliance has also been placed on a communication addressed by the appellant to the respondents in which it has been said that judging from sound business principles the chemical works had not yet turned the corner of losses, but the position appeared brighter, and it was hoped that with the co operation of labour the chemical works would be an asset to the D. C. M. family.
Our attention has also been drawn to various annual reports in which an optimistic picture has been painted by the directors for the benefit of the shareholders.
We agree however with the tribunal that in spite of the possibility that in time to come the chemical works might acquire stability and prove a source of increasing profit to the Company, the fact remains that upto now the.
chemical works has been running at a loss except for two years and one cannot be certain that it will start earning profits soon.
In these circumstances it seems to us that the tribunal was justified in not framing an incremental scale of wages at the present juncture as that would put a heavy strain on the finances on the chemical works which has yet to attain financial stability.
At the present moment the losses incurred in this unit have to be met froth the profits earned in other units of the Company and in this situation we do not think that the tribunal was wrong in refusing, to frame incremental scales.
It is however urged on behalf of the respondents that if in the course of the last twenty years the capital invested in the chemical works has increased 528 tremendously as compared to the modest amount with which it was started in 1942 and if the Company can find capital for the purpose of expansion, it should be able to pay incremental scales of wages by dipping into the same source from which it has been able to find capital.
In effect this argument means that even though the concern may be making losses year after year it should find money for paying the labour force higher wages in spite of the circumstance that that may lead it into incurring further losses.
The argument seems to be that even though there may be losses the concern must pay higher wages to the workmen and if necessary pay them out of what may be called capital.
Now this argument would in our opinion be unanswerable if the claim was for what is called minimum wage: (See Messrs Crown Aluminium Works vs Their Workmen (1).
If the wages paid by the appellant in the present case were below the minimum wage that the tribunal would certainly be justified in ordering it to pay the minimum wage, for no industry can have a right to exist if it cannot pay wages at the bare subsistence level.
Where it is a case of payment of minimum wage, the tribunal can insist on the same being found, if necessary, even out of capital.
But this is not a case of bare minimum wage and we are dealing with a case of fair wage which is above the bare minimum wage.
It is not even the case of the respondents that they are not getting the bare minimum wage.
Their case is that they should be given a fair wage, and that the present wages, though above the bare minimum wage, are still not fair enough and therefore should be increased and an incremental scale should be fixed.
In such a situation we are of opinion that the present financial condition of the concern and its stability are both necessary to be considered before an increased fair wage can be given.
Both the present capacity of (1) ; 529 of the employer to pay the increased rates of incremental wages and its future capacity have to be taken into account in determining an increased level of fair wages based on an incremental scale.
Thus both financial ability at present and financial stability in the near future must be there to justify fixation of an increased fair wage on an incremental scale.
We do not think it will be right to insist on an increased fair wage on an incremental scale in a case where the financial capacity and the financial stability as judged by business principles are both lacking.
Nor would it in our opinion be right to compel the employer to bear the burden of an increased fair wage on an incremental scale and tell him to find money from what may in effect be capital, for such a 'situation in ordinary cases can lead only to one result, namely, the closure of the business concern, which may be more detrimental to the workmen.
Therefore carrying on with the present scale of fair wages and hoping that the financial ability and stability of the concern will improve, with the result that increased fair wage on an incremental basis may be fixed in future is the only alternative at present even in the interest of the workmen employed in this ' concern.
We therefore agree with the tribunal that in the circum,stances no case has been made for fixing an incremental scale of wages at the present juncture.
The contention this head must therefore be rejected.
As to the canteen workmen, it appears that the canteen is run by the appellant departmentally on a no profit no loss basis.
The workmen employed in the canteen are the workmen of the appellant and their number is sixteen or seventeen.
The minimum basic wage for unskilled workmen in this concern at the relevant time was Rs. 38 plus Rs. 55 i. e. Rs. 93 ; but the workmen in the canteen get consolidated wages and all of them (except one) get 530 much less than the minimum, the figures varying from Rs. 50 to Rs. 78.
The tribunal has held that there is no reason why the conditions of service of the workmen in the canteen should not be brought on a par with the conditions of service of the rest of the workmen.
It therefore ordered that the workmen in the canteen would be entitled to the same facilities relating to leave, provident fund, bonus, and gratuity etc.
as are available to the other workmen in the chemical works ; but so far as wages and dearness allowance are concerned, it has not given them even the minimum as indicated above.
The case of the the appellant was that even if ' the minimum was paid to the workmen in the canteen the price of the various food stuffs supplied by the canteen to the workmen would go up substantially and it was on that ground that the appellant resisted the increase in the wages of those workmen in the canteen who are getting less than the minimum of Rs. 93.
The tribunal has held and we think rightly that the fact that the bettering of the conditions of service of the workmen in the canteen may lead to a rise in the price of things sold ' there is no reason for refusing the demand of the workmen ; but it has not carried into effect fully the implications of this observation.
It has ordered that same conditions as to leave facilities etc.
should be extended to the canteen workmen but has stopped short of giving them the same wages and dearness allowance.
The reason why the tribunal did not give the workmen the same wages and dearness allowance is that there was no satisfactory material before it to permit it to fix wages and dearness allowance for the workmen in the canteen.
We are of opinion that there is no reason why the tribunal should not have at least granted the minimum which is paid to the other workmen in the concern to those workmen in the canteen who are getting less than the minimum.
We can see no reason for not giving them also the 531 minimum wages as indicated above.
This will certainly result in bringing the fifteen workmen who are getting between Its. 50 and Rs. 78 per mensem as consolidated wages into an equal position, for each will then get the minimum, namely,.
Rs. 38 plus Rs. 55 and may remove part of the discontent.
In the circumstances that is all that can be done in the absence of the material to which the tribunal has referred.
Therefore the wages of those fifteen workmen who are getting less than the minimum should be brought to the same level.
There is no reason why they should not get such benefits as may be due to them, by their wages being brought to the same minimum as the wages of the other workmen in the concern.
We therefore disagree with the tribunal with respect to the workmen employed in the canteen and order that the wages of those workmen who are getting less than the minimum paid to the other workmen in the concern should be brought to the same minimum level.
The rest of the award on this head will stand.
The minimum wages as above will be paid from the date the tribunal has ordered its award to come into force.
(iii) The claim of the workmen in this connection was that there were 300 workmen employed in the civil engineering department and that they should be made permanent.
The ' tribunal however rejected this contention and pointed out that most of the workmen were temporarily engaged to carry on construction work which was of a temporary nature and therefore.
they could not be made permanent simply because the construction had lasted for more than a year.
This view of the tribunal is in our view correct in so far as the claim put forward with respect to all the three hundred workmen was concerned.
It appears however that at the time when the tribunal recorded 532 evidence the large majority of these 300 workmen had been discharged because they were no longer required and only about 65 remained in service.
It appears from the evidence 'of the Joint Works Manager that a skeleton staff on the civil engineering side is kept for maintenance of buildings and this skeleton staff is of a more or less permanent nature.
The argument therefore before us is that at any rate this skeleton staff should be made permanent.
It was however urged on behalf of the appellant that this was not the way in which the matter was put before the tribunal.
The position now is however clear that a skeleton staff is kept on a permanent basis for the civil engineering department and it seems to us fair that the appellant should be directed to make this skeleton staff permanent and give them the same facilities and wages etc., as are given to the other workmen.
We therefore direct that the appellant shall make such of the skeleton staff as is maintained for civil engineering purpose permanent and give them the same conditions of service including the same minimum wages etc.
as to the rest of the workmen.
It is however left to the discretion of the appellant to determine what should be the strength of this staff and which persons should be retained as permanent employees.
We say this because the matter was not gone into from this point of view before the tribunal and we have no material on which we ourselves can determine the strength of the skeleton staff and the persons who should ' be made permanent on that account.
The direction will be given effect to within three months of this judgement.
The workmen have been given 2 1/2 months basic wages as bonus for the years in dispute, namely, 1953 54 and 1954 55.
They have claimed additional bonus.
It is however conceded fairly 533 on behalf of the respondent that if the chemical works is treated as an independent unit their case for additional bonus on the basis of the Full Bench formula cannot succeed.
The demand for additional bonus was rightly rejected by the tribunal, considering the chemical works as an independent unit.
We may add that this case is distinguishable from the case of Hony.
Secretary, South India Mill owners Association, (1) for here the two lines of business are distinct and have nothing to do with each other.
This brings us to the appeal by the appellant.
Five points have been urged on behalf of the appellant.
They are: (i) dearness allowance; (ii) uniforms, (iii) acid and gas allowance.
(iv) leave facilities, and (v) gratuity.
We shall deal with them one by one.
So fag as dearness allowance is concerned, the tribunal has ordered that the dearness allowance in the chemical works shall be fixed at the same rate as it is in the power house which is a part of the chemical works.
It may be mentioned that dearness allowance at the relevant time in the chemical works was Rs. 55 per mensem while in the power house it was Rs. 66 per mensem.
The contention on behalf of the appellant in this connection is that the reason why there was this difference 'between the dearness allowance in the power house and in the rest of the chemical works is historical.
It is further pointed out that though the difference in the two dearness allowances is Rs. 11 the actual difference in the total wage packet was only Rs. 3 inasmuch as the minimum basic wage in the power house was Rs. 30 while in the chemical works it was Rs. 38 at the relevant time.
Thus the minimum that an employee was getting in the power house was Rs. 96 while the minimum for the rest of the workmen was Rs. 93, and it is (1) C.A. 419 of 1960.
decided on 1 2 1962.
534 urged that the difference is not serious.
The reason that the tribunal gave for increasing the dearness allowance for the other workmen in the concern was that there was no ground for discriminating between the workmen in the power house and the rest of the workmen.
In increasing the dearness allowance on this sole ground the tribunal ignored firstly the historical reason why there was this difference between the dearness allowance for the power house staff and for the rest of the workmen and also ignored the difference in the basic minimum wages in the power house and for the rest of the workmen.
It further seems to have ignored its own earlier finding that the chemical works was running at a loss and did not have the financial capacity to bear further burden.
As a matter of fact it appears that but for this discrimination which the tribunal found between the rate of dearness allowance for the power house employees and the rest of the workmen it may not have made any change in the dearness allowance payable to the rest of the workmen.
It may be mentioned that the system of dearness allowance in the concern is to allow neutralization at the rate of 2 1/2 annas (now 17 nP.) for each point rise over the working class cost of living index treating the base as 100 for the year 1939.
It may also be mentioned that since the reference was made there has been a voluntary increase in the dearness allowance for the rest of the workmen at the rate of Rs. 6 per mensem.
The reason why this difference is existing between the rate of dearness allowance for the power house employees and rest of the workmen is that for sometime the power house was integrated with the Swatantra Bharat Mills.
Therefore as an integral part of the cotton textile industry the rates of basic wages and dearness allowance 535 in the power house were the same as in the cotton textile business of the company.
Thus the rates there at the relevant time were, as we have already said, Rs. 30 basic wage and Rs. 66 dearness allowance.
At that time the minimum wage in the chemical works was Rs. 38 basic plus Its.
55 dearness allowance i.e. Rs. 93 in all.
It appears however that there was some objection by the Excise Department of the Government as there was a gate between the Swatantra Mills and the chemical works.
The Excise Department wanted this gate to be blocked in order to have better control over the excisable articles produced in the chemical works.
The appellant therefore had to block up this gate in 1950 and therefore the power house which existed on the chemical works side of this gate was transferred from the Swatantra This to the chemical works.
However as the power house workmen were getting the textile rates, the Company assured them that trough they would thereafter be under the control of the chemical works they will be governed for the purposes of pay scales and dearness allowance of I c. by the rule of the Swatantra Mills.
It is this circumstance which has resulted in different scales for the power house staff and the rest of the workmen of the chemical works.
It further appears that there was some retrenchment in the power in 1957 and the retrenched workmen were absorbed as far as possible in others units.
At that time there was an agreement between the Company and the power house workmen and it was agreed that these workmen would be absorbed in other units but they would accept the conditions of service etc.
of those units where they were absorbed, with the result that only those who are left in the power house continue on the textile scales of the Swatantra Bharat Mills.
These circumstances however were not taken into account by the tribunal at all when it ordered that the power house scale of 536 dearness allowance should be introduced for the rest of the workmen also.
The power house scale is really the textile scale and the appellant contended that it would lead to a good deal of complication if the textile scale of dearness allowance is ordered to be introduced for the chemical works.
We are of opinion that there is force in this contention raised on behalf of the appellant and the tribunal was not justified in increasing the dearness allowance for the chemical works merely because of this fortuitous circumstance arising out of historical reasons.
In any case the number of the power house workmen is very small, say about 30140, who who are getting a different rate of dearness allowance: Further it appears that there was not much difference between the total wage packet for the power house workmen and for the rest and that was another reason why the tribunal should not have introduced the power house scale for the rest of the workmen.
It has however been urged on behalf of the respondents that the difference in the basic minimum wages between the power house workmen and the rest of the workmen in the chemical works has disappeared after the recommendations of the Textile Wage Board by which the minimum basic wage for textile workers has been increased by Rs. 8 and it became Rs. 38 from January 1, 1960.
Therefore, it is urged that there .is no reason why the tribunal 's award with respect to making the dearness allowance for the rest of the workmen the same as the workmen of the power .house should not be allowed to stand.
Superficially, this argument looks attractive ; but if one examines it in the light of the Textile Wage Board 's recommendations it will be found that the linking of the dearness allowance.
for the chemical work 's workmen with the power house workmen would lead to endless complications, for the power house workmen would be entitled to the same dearness allowance etc, as would govern the textile workmen in the 537 Swatantra Bharat Mills.
The Textile Wage Board report shows that it recommended not only that the basic wage should be increased but also that a large part of the dearness allowance should be merged with basic wage, the remainder alone remaining as dearness allowance.
It is submitted on behalf of the appellant that it has carried out the recommendations of the Textile Wage Board and the result of the same has been that the basic wages of the textile workmen which would apply to the power house workmen would be fixed at about Rs. 88 or Rs. 89 and the dearness allowance would be reduced to about Rs. 15.
It is urged that the practical linking of the dearness allowance for the rest of the workmen with the dearness allowance in the power house which has been ordered by the tribunal on the ground that there should be no discrimination., would result in endless trouble, apart from the question whether in view of the earlier finding of the tribunal as to the financial.
capacity of the appellant it would be possible for the appellant to bear the extra burden of the increased dearness allowance.
The operative order of the tribunal is that the workmen of the chemical works, excluding the workmen who are governed by exhibit W/2, should be paid dearness allowance at the rate at which it is being given to the workmen of the power house, and this undoubtedly in our opinion would lead to endless trouble now that the recommendations of the Textile Wage Board will for historical reasons apply to the workmen in the power house.
Which are therefore of opinion that the ground on which the tribunal ordered the rate of dearness allowance for the other workmen of the chemical works to be paid on a par with the rate for the power house is not sustainable and the tribunal went wrong in not giving due weight to the histori cal reasons for the rates prevailing in the power house.
Further we are of opinion that the increase is not sustainable on its own merits on the ground 538 of the financial capacity of the concern, which the tribunal itself found was not sound, as the concern bad been running at loss practically since it came into existence except for two years.
The contention therefore on behalf of the appellant on this head must be accepted and the order of the tribunal increasing the dearness allowance set aside.
As to uniforms, we see Do reason to differ from the view taken by the tribunal.
The reasons given by the tribunal for ordering that uniforms should be given to certain category of workmen Are in our opinion sound.
But the tribunal bat; trade a mistake when it went on to order that protective equipment should also be given in addition to uniforms, to the persons found entitled to uniforms according to the directions of the tribunal.
The tribunal seems to have overlooked the difference between uniforms and protective equipment; which is provided in the Delhi Factory Rules.
So far as protective equipment is concerned, it is given for certain specific purposes to be found in the Rules and has no connection with uniforms which employers are ordered to supply to their workmen, for reasons entirely different.
We are therefore of opinion that the direction of the tribunal that protective equipment should also be supplied to persons found entitled to uniforms under its order, is not correct and should be set aside.
So far as protective equipment is concerned, it will only be supplied to those who are entitled to it under the Delhi Factory Rules and not necessarily to all to whom uniforms may have to resupplied under the orders of the tribunal.
We order accordingly.
(iii).
At; to acid and gas allowance, the tribunal has ordered the payment of Rs. 3 per month to certain categories of workmen.
It appears that originally 539 the appellant used to pay Rs. 5 as acid and gas allowance in the Nitric acid gas plant and Rs. 3 in the contact plant.
Later, however, this gas allowance was merged in pay.
But it appears that gas allowance, is still being paid to the workmen in the pity trie acid gas plant.
It 'is contended on behalf of the appellant that this was because the gas allow ance in the case of these workman was not merged in pay.
There is, however, nothing on the record to prove this.
As the record 'stands we have no reason to hold that the gas allowance which was originally paid to the workmen of the nitric acid gas plant was riot merged in their pay.
On the whole therefore the reasons given by the tribunal for making the allowance (1) Rs. 3 to those workmen who are engaged in the manufacture of chlorine, sulphuric acid, caustic soda and hydrochloric acid Appear to us to be sound and we see no reason to interfere with that part of the award.
So far as leave facilities are concerned, the tribunal has awarded that privilege should be granted as provided under the Factories Act.
It has further provided that casual cum sick leave should be granted,for twelve days in the year.
We do not think that this award is in any way, unreasonable.
The"tribunal has however gone on to deal with festival holidays, and that in our opinion the tribunal had no jurisdiction to do.
The reference was in these terms : "Whether leave facilities should be increased and if so, to what extent".
There was no with respect, to holidays.
The tribunal has however taken the view that holidays are covered within the words "leave facilities" used in the order of reference.
We are of opinion that this view is incorrect.
Holidays are entirely different in leave facilities.
On a, 540 holiday the entire business is closed and no one works while leave facilities deal with leave for individual workers while the business as a whole is running.
We may in this connection refer to item 4 of the Third Schedule to the Industrial Disputes Act (No. 14 of 1947), which is in these terms : ""Leave with wages and holidays".
This shows that holidays stand on a different footing altogether from leave with wages and a reference with respect to leave facilities cannot include a consideration of holidays.
The tribunal 's order with respect to holidays is set aside.
Lastly we come to the gratuity scheme sanctioned by the tribunal.
It is true that in this concern there is already a provident fund scheme in force.
But it is now well settled that both gratuity as well as provident fund schemes can be framed in the same concern if its financial position allows it.
It is true that the financial position of the chemical works has not been found to be good and stable enough to warrant an incremental wage structure ; but gratuity is a long term provision and there is no reason to suppose that in the long, run the appellant will not be in a flourishing condition.
As to the burden of the scheme, we do not think that, looking at it from a practical point of view and taking into account the fact that there are about 800 work men in all in the concern, the burden per year would be very high, considering that the number of retirements is between three to four per centum of the total strength.
Further we find that in this very concern there is a gratuity scheme for clerks who number between 100 and 200 and are part of the labour force.
We can see under the circumstances no reason why a similar gratuity scheme should not be framed for the rest of the 541 workmen.
We therefore see no reason to interfere with the order of the tribunal in this respect.
We therefore allow the appeals in part and dismiss them in part in the manner indicated in the course of this judgment.
In the circumstances parties will bear their own costs in both the appeals.
Appeals allowed in part.

dataset_name: IN-Abs

summary:
The disputes between the appellant, the management of the D.C.M. Chemical Works which was a constituent unit of the Delhi Cloth and General Mills Limited (the Company), and its workmen related, inter alia, to wage scales and gratuity.
The workmen claimed that the chemical works was an integral part of the Company and, therefore, the over all position of the Company should be taken into account in fixing the wage structure.
The Industrial Tribunal to which the matter was referred held that in the circumstances of the case the chemical works should be treated as an independent unit and that the wage structure etc. could not be fixed on the basis of the over.
all position of the Company.
The facts showed that the high the Company was a single limited concern owning and controlling various industrial units of different kinds under it.
There were certain features which went to show that the various undertakings carried on by the Company had been treated as independent concerns and could not lead to the conclusion that they were one integrated whole.
It was found that (i) each unit had separate books of account and separate profit and loss account, (ii) each unit had separate muster rolls for its employees, and transfers from one unit to the other usually took place with the consent of the employees concerned, (iii) each unit had its own separate wages and dearness allowance and bonus was also paid differently in each concern,(iv) where sales took place from one unit to another they were at market price and not at cost price, and (v) each unit had its own separate management.
The evidence showed that throughout the course of its existence since 1942 the chemical works had made profits only in two years and that for the rest of the time it had been making losses which had to be met by the Com pany out of the profits of other units.
Held, that on the facts found in the present case, there was no nexus of integration between different lines of business carried on by the Company and that the Tribunal was right in 517 its conclusion that the chemical works was ' an independent unit and that, therefore, in fixing the wage structure etc.
, one had to look to the position of the chemical works only and could not integrate it with other units.
The Associated Cement Companies Limited, Chaibassa Cement Works,Jhinkpani vs Their Workmen, (1960) 1 S.C.R. T, 703, Pratap Press etc.
vs Workmen, , Pakshi raja Studios V. Workmen, and Hony.
Secretary, South India Milloumers 'Association vs Secretary, District Coimbatore District Textile Workmen Union, (1962) (2) S.C.R. (Supp.) p. 926 relied on.
Fine Knitting Co. Ltd. vs Industrial Court, Bombay, (1962) (3) S.C.R. (Supp.) p. 196, applied.
Held, further, that in making a direction for the fixation of an increased fair wage on an incremental scale, the present financial condition of the concern and its stability are both necessary to be considered.
There is a difference between a minimum wage and fair wage which is above the bare minimum wage.
In the former case the tribunal could insist that the employer paid minimum wages even out of capital.
Messrs Crown Aluminium Works vs Their Workmen, (1958) S.C.R. 651, referred to.
Held, also, that it is well settled that both gratuity As well as provident fund schemes can be framed in the same concern if its financial position allows it, and that though the financial position of the chemical works had not been found to be good and stable enough to warrant an incremental wage structure, the direction given by the Tribunal for the framing of a gratuity scheme was not erroneous, as it was a long term provision and there was no reason to suppose that in the long run the appellant would not be in a flourishing condition.


judgement:
Appeal No. 121 of 1951.
Appeal from the Judgment and Decree dated 15th December, 1948, of the High Court of Judicature at Madras (Subba Rao and Pancha,Pakesa Ayyar JJ.) in Appeal No. 474 of 1945 arising out of the Judgment and Decree dated 3 1 st July, 1945,, of the Court of the Subordinate Judge of Tenali in Original Suit No, 24 of 1944.
130 1002 M. C. Setalvad, Attorney General for India, (N. Subrahmanyam and K. R. Chowdhury, with him) for the appellants.
K. section Krishnaswamy Aiyangar (M. Seshachalapathi, with him) for the respondents.
February 26.
The Judgment of the Court was delivered by DAS J.
This appeal arises out of a suit for recovery of possession of certain immovable properties measuring about 93 acres and 33 cents which are more fully and particularly set out and described in Schedule A to the plaint.
That suit was instituted by Konduru Venkatapayya, respondent No. 1, in his capacity as the Executive Officer appointed by the Government on the 15th July, 1942, in respect of Sri Somasekharaswami Temple at Kotipalle, hamlet of Donepudi, a temple notified on the 26th October, 1939, under the provisions of Chapter VIA of the Madras Hindu Religious Endowments Act (Act 11 of 1927).
The suit was instituted in forma pauperis.
The claim for ejectment of the defendants was founded on the allegation that the properties belonged to the temple, having been given to it by an Inam grant made in 1770 A.D. by Janganna Rao, the then Zamindar of Rachur, that the defendants I to 16 and their predecessors were Archakas rendering Nitya Naivedya Deeparadhana services and as such were in possession of the properties for and on behalf of the temple and that defendants 17 to 43 were the lessees under the Archakas and that the defendants I to 16 were wrongfully claiming the properties as their own and the other defendants claimed to be in possession of portions of the properties as their lessees.
The plaintiff instituted this suit after having given registered notice to the defendants to make over possession of the suit properties to the plaintiff as the Executive Officer of the temple but the defendants were still continuing in such possession in spite of such notice.
The defendants filed written statements raising various contentions 1003 and issues to which it is not necessary now to refer.
The learned Subordinate Judge by his judgment dated the 31st July, 1945, decreed the plaintiff 's suit.
Some of the defendants preferred an appeal to the High Court but the High Court dismissed the same.
Those defendants obtained leave of the High Court to appeal to the Federal Court and that appeal has now come up for hearing before us.
The only two points which were raised before us, as before the High Court, are (1) whether the Inam grant was made in favour of the temple or whether the grant was made in favour of the Archakas burdened with the duties of service, and (2) what right did the grant confer on the grantee whether it was a grant of the land itself or only of the melvaram interest in the properties.
It is urged by the learned Attorney General that as the defendants and their predecessors have been in possession of the properties from ancient times it should be presumed that their possession originated in some lawful title conferred on them.
In short, the contention, founded on several judicial decisions, is that the principle of a lost grant should be applied in this case in favour of the Archakas who have been in quiet possession for over a century and a half.
There is no doubt, on the authorities, that a presumption of an origin in some lawful title may in certain circumstances be made to support possessory rights long and quietly enjoyed where no actual proof of title is forthcoming but it is equally well established that that presumption cannot be made where there is sufficient evidence and convincing proof of the nature of the grant and the persons to whom it was made.
It is true that the original grant is not forthcoming but turning to the evidence we find two documents which appear to us to be decisive on the question of title.
The first one is Exhibit P/3, a copy of the relevant entries in the Inam Register of 1860.
This Inam Register was prepared after enquiries made by the Inam Deputy Collector and the statements furnished at that time by the then Archakas were taken into consideration for 1004 preparing the register.
The copy of the statement filed by the then Archakas before the Inam Deputy Collector was exhibited in this case as Exhibit D/3.
In the Inam Register (exhibit P/3) under the several columns grouped under the general heading " Class extent and value of Inam " this Inam is classified in column 2 as Devadayam.
In column 3 are set out the survey numbers together with the word ' Dry ' indicating the nature of the land comprised within the survey numbers.
The areas are set out in column 5.
The heading of column 7 is " where no survey has been made and no assessment fixed by Government, the cess paid by the ryot to the Inamdar, or the average assessment of similar Government land should be entered in column (7) ".
Under this heading are set out the amounts of respective assessments against the three survey numbers totalling Rs. 198139.
We then pass on the next group of columns under the general heading " Description, tenure and documents in support of the Inam ".
Under column 8 'description of Inam 'is entered the remark " For the support of a Pagoda.
Now kept up ".
The entry in column 9 shows that the Inam was free of tax, i.e., sarvadumbala.
Under column 10 headed "Hereditary, unconditional for life only or for two or more lives " is mentioned ' Permanent '.
The name of the grantor as stated in column 1 1 is Janganna Rao and the year of grant is fasli 1179, A.D. 1770.
In column 13 the name of the temple is set out as the original grantee.
The name of the temple and the location of the temple are also set out under columns 16 and 17.
Turning now to the statement exhibit D/3 caused to be written and filed by the then Archakas during the Inam Inquiry held in 1859 60 Sree Somasekharaswami Varu is given as the name of the Inamdar and the present enjoyer.
The name of the temple is also set out under columns 3,5,6 and 12.
Under the heading " Income derived from the Inam whether it is sarvadumbala or jodi.
lf jodi the amount" in column 13 is stated " sarvadumbala Inam Cist according to the rate prevailing in the neighbouring fields Rs. 26631.
" This statement (exhibit D/3) bears 1005 the signature of the Karnams and the witnesses.
it will be noticed that neither in the Inam Register exhibit P/3 nor in the statement exhibit D/3 is there any mention of the Archakas as the grantee or for the matter of that, having any the least interest, personal or otherwise, in the subject matter of the Inam grant.
The two exhibits quite clearly indicate that the Inam grant was made in favour of the temple by the gurant or and that in the face of this definite evidence and proof of the nature of the grant, no presumption of a lost grant can be made in favour of the Archakas.
We, therefore, in agreement with the High Court, hold that the deity was the grantee and the first question raised before us must be answered against the appellants.
The learned Attorney General next contends that, assuming that the Inam grant was made in favour of the temple, it was only a grant of melvaram interest and that the Archakas who have the kudivaram rights cannot be ejected.
He relies strongly on an unreported judgment of the Madras High Court in Appeal No. 213 of 1942 (The Board of Commissioners for the Hindu Religious Endowments, Madras vs Parasaram Veeraraghavacharyulu and others) where it was held: "The records of the Inam settlement really contain only one clear indication as to the precise extent of this grant.
The statement at the Inam Inquiry, Exhibit V, upon which the decision of the Inam Commissioner was presumably based contains a column headed " Income realised from the Inam sarvadumbala " and in that column we find the entry "Rs. 14 sarvadumbala".
On its face this entry seems to show that the income of the Inam was Rs. 14 free from all charges.
We find, however, from the Inam Register, Exhibit IV, that the assessment of the Inam on the basis of the enjoyment of 16 97 acres is also Rs. 14.
This seems to indicate that the extent of the Inam was the amount of the assessment.
* * * * * It seems, therefore, that the decision must rest on the recital in Exhibit V that the income of the Inam 1006 consists of Rs. 14, read along with the recital in Exhibit TV that the assessment on the land also comes to Rs. 14.
On these materials we confirm the findings of the learned District Judge, although we do not accept his reasoning, and hold that the grant is a grant of melvaram only.
" The facts of that case appear to us to be different from those in the present case.
The Archakas in.
that case were found to have the kudivaram rights from before the Inam grant was made.
In the copies of the Inam Register and Inam Statement filed in that case the Archakas were shown as the grantees and the present enjoyers of the Inam grant and the amount shown under the heading in column 2 of the Inam register as the assessment was the same as the amount shown under column 3 of the Inam Statement under the heading "Income derived from Inam".
In the case before us the Archakas are nowhere mentioned in either Exhibit P/3 or in Exhibit D/3, there is no evidence that they had any title to kudivaram rights and finally the amount of assessment shown under column 7 of the Inam register, Exhibit P/3, is Rs. 198139, whereas the amount shown as income derived from the Inam as shown in column 13 of the Inam Statement, Exhibit D/3, is Rs. 26631.
Apart from these points of distinction the decision relied on by the learned Attorney General appears to us to be of doubtful authority.
As will appear from the passages quoted above, the decision rested mainly, if not entirely, on the fact that the amount of assessment and the amount of income were the same and the conclusion was drawn that the Inam grant comprised only of the revenue assessment, i.e., of melvaram rights.
We are unable to follow the reasoning.
Whether the Inam comprised the land itself, that is to say, both melvaram and kudivaram rights or only the melvaram rights, the entries had to be made in the Inam Register in the same form and even in the case of the grant of the land itself comprising both the rights the amount of assessment had to be set out under column 7 of the Inam Register for it is not 1007 suggested that a different form had to be used where the grant comprised both the rights.
It follows, therefore, that no inference that the Inam grant comprised only melvaram rights can be inferred from the fact that under column 7 only the amount of assessment is set out, and, therefore, the reasoning on which the decision relied on by the learned Attorney General was founded cannot be supported as correct.
Indeed, that decision has been dissented from by another Bench of the Madras High Court in Yelamanchili Venkatadri & another vs Vedantam Seshacharyulu and others (1).
In the present case the High Court was, in our opinion, clearly right in preferring the last mentioned decision to the unreported decision mentioned above.
Having regard to the different entries under the different columns in Exhibit P/3 and Exhibit D/3 there is no escape from the position that this Inam grant in favour of the temple comprised both the interests in the land.
An argument was sought to be raised by the learned Attorney General that the grantor Janganna Rao was only the Collector of the revenue and as such could not grant more than what he had got.
Reference was made to the Kistna District Manual by Gordon Mackenzie but it appeared that the person therein mentioned was not the same grantor as we are concerned with in this case and the point was not pursued and nothing further need be said about it.
Finally, the learned Attorney General submits that these Archakas who were rendering services faithfully from generation to generation from ancient times should not, in equity, be ejected from the entire lands and that they should be allowed to remain in possession of the lands and be permitted to appropriate to themselves the expenses of the services and a reasonable remuneration and the rest of the income should be made over to the temple as its property.
Reference was made to two unreported decisions of the Madras High Court in Appeal No. 218 of 1946 (1) A.I.R. 1948 Mad. 72, 1008 Dandibhotla Kutumba Sastrulu vs Kontharapu Venkatalingam, and in Appeal No. 709 of 1944, Buddu Satyanarayana vs Dasari Butchayya, Executive Officer of the Temple of Sri Malleswaraswami Varu, China Pulivaram.
In a proceeding for the framing of a scheme relating to a temple it may be permissible to take into account the claims, moral if not legal, of the Archakas and to make some provision for protecting their rights, but those considerations appear to us to be entirely out of place in a suit for ejectment on proof of title.
If the two decisions lay down, as it is contended they do, that the principles which may have a bearing on a proceeding for framing of a scheme or for enforcing the scheme that is framed may be applied to a case of the kind we have now before us it will be difficult for us to uphold them either on authority or on principle.
Further what is the conduct of the Archakas defendants appearing on the record of this case ? Although they are Archakas they actually asserted an adverse right in the face of the honest admission of their predecessors in title, made in the Inam statement Exhibit D 3.
Such conduct cannot but be regarded as disentitling them from any claim founded on equity.
The explanation put forward for the first time in paragraph 7 of their present statement of case filed in this Court explaining the absence of a claim to the property by their predecessors at the time of the Inam Inquiry namely, respect for the deity enjoined by Agama Shastra is not at all convincing.
Further, the giving of such equitable relief must depend on questions of fact, namely, the income of the property, the reasonable expenses and remuneration for the services, the amounts appropriated by them all this time and so forth which have not been investigated into in this case, because, no doubt, this question of equitable relief has been put forward as a last resort after having lost their battle.
We do not think in the circumstances of the case any indulgence should be shown to the Archakas even if it were permissible for the Court in a suit of this description to give such relief.
1009 The result, therefore, is that this appeal must fail and is accordingly dismissed with costs.
Appeal dismissed.
Agent for appellant: section Subramaniam.
Agent for respondent: M.S.K. Aiyangar.

summary:
Though a presumption of an origin in some lawful title may in certain circumstances be made to support possessory rights long and quietly enjoyed where no actual proof of title is forthcoming, that presumption cannot be made where there is sufficient evidence and convincing proof of the nature of the grant and of the persons to whom it was made.
In the case of an inam grant, the mere fact that the amount shown in the In am Register as the assessment was the same as the amount shown in the Inam Statement under the heading "income from the inam" does not lead to an inference that the grant comprised only the melvaram rights and not the land itself.
Though in a proceeding for framing a scheme relating to a temple it may be permissible to take into account the claims, moral though not legal, of the archakas and to make some provision to protect their interest, such considerations are out of place in a suit for ejectment of the archakas on proof of title, especially when they set up an adverse title and deny the title of the temple.
[On the facts their Lordships held (i) that there was clear evidence that the inam grant in question was made by the grantor in favour of the temple and that in the face of this definite evidence as to the nature of the grant no presumption of a lost grant can be made in favour of the archakas of the temple; and (ii) that the grant was of the land itself and not of melvaram rights only.]