THE ASSOCIATED CEMENT COMPANY LTD. versus SHRI P. D. VYAS AND OTHERS.

Corporation of the City of Nagpur v. Its Employees

Subba Rao ].

February, II

with industrial departments, is also an industry. Hence the employees of this department are also entitled to the benefits of this Act.

The State Industrial Court held that five of the departments of the Corporation did not fall within the terms of the definition of" industry " in the Act. The employees of these departments did not file any appeal against the finding of the State Industrial Court and we do not propose to express our final opinion on the correctness of the decision of the Industrial Court in regard to these activities. In the result the appeals fail and are dismissed with costs.

Appeal dismissed.

THE ASSOCIATED CEMENT COMPANY LTD.

SHRI P. D. VY AS AND OTHERS.

(B. P. GAJENDRAGADKAR AND K. c. DAS GUPTA, JJ.)

Ind,,strial Disp,,te-Standing Orders-Draft su.bmitted by employer for approval-Modification by Certifyitig Ojficer-J"risdiction-Ind"strial Employment (Standing Orders) Act, I946 (20 of I946) SS. J, 4, 5, I5(2) (b). 1

The draft standing orders submitted by the appellants to the certifying officer for certification under s. 3(1) of the Industrial Employment (Standing Orders) Act, 1946, were altered by the latter on the footing that the modifications were necessary so as to be in conformity \Vith the model standing orders. Section 4 of the Act, before it was amended in 1956, provided that "it shall not be the function of the certifying officer or the appellate authority to adjudicate upon the fairness or reasonableness of the provisions of any standing order," while under s. 3(2) the draft shall be, as far as is practicable, in conformity with the model standing orders, where they have been prescribed. The question was whether the certifying officer had jurisdiction to make the modifications in the present case.

Held, that there is distinction between considerations of fairness or reasonableness and those of practicability, and that though the certifying officer may not modify the draft on the ground that its provisions are unfair or unreasonable, he can and must modify it in matters covered by the model standing

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orders tf he is satisfied that conformity with such model standing-orders is practicable in the circumstances of the case.

~796“Associate-Cement¥, Co. Lid.pp. Vyas——

A.I.R.Electric 1949 All. Workers’ 504, disapproved. Union v. The U.P. Electric Supply Co.,

_jtwan “Mal & Co. v. Secretary, Kanpur Loha Mills Karma-chari Union & Ors., A.I.R. 1955 All. 581 and Mysore KirloskarEmployees’ Assotiation v. Industrial Tribunal,Bangalore and Anr. and Anr. Anr. Gajendragadhar J.”[1959] r L.L.J. 531, approved.- ...

Bangalore and Anr. and Anr. Anr. Gajendragadhar J.”

Civin APPELLATE JuRIsDIcrion:Civil “Appeal|No. 22 of 1958..|:|

_.Appeal fromthe judgment and orderdatedDecember 2, 1954, of the Bombay High Court inAppeal No. 122 of 1954, arising out of theJudgmentandHigh order Court dated in Civil September Mise. Application30, 1954, of No. ‘the 267/X said

OF INSEE.

EJ. Kolah, S.-N. Andley, J.B’ Dadachanji,- Rameshwar Nath and P. L. Vohra, for the appellant.

Gopal Singh and R. H. Dhebar.for respondent

1960. February, 11.The Judgment of the Courtwas delivered by|

_GAJENDRAGADKAR J.—The Associated| Cement Com-panies Ltd., Dwarka Cement Works, Dwarka and the_Associated Cement Companies Ltd., Sevalia CementWorks, Sevalia (hereinafter called the appellants) ownand manage several cement works throughout Indiaincluding inter alia cement manufacturing factories atDwarka and Sevalia called the Dwarka Cement Worksand the Sevalia Cement Works respectively.In 1946the appellants submitted to respondent 2,theCommis-sioner of Labour, Bombay, in his capacity as certifyingofficer, draft standing orders for certification under8. 8(1) of the Industrial Employment (Standing Orders)Act, 1946 (20 of 1946)(hereinafter called the Act).Respondent 2 made several alterations in-the draftsubmitted by theappellants.The two important.- alterations which are the subject-matter ofthe presentappcal were in respect of items Nos. 8 and 16. Underitem No. 8 the draft standing orders had required_ that notice of fourteen days shall be given in theevent of discontinuance of shift.Respondent 2 hasmodified it by increasing the period of notice fromfourteen days to one month. This modification has

onme

,960 been made in accordance with the model standing order on this subject. Similarly, item No. 16(2) in the Associated C•ment Co. Ltd. draft standing orders provided that striking work v. either singly or with other workers without giving P. D. Vyas fourteen days' previous notice would be treatPd as -misconduct; whereas item No. 16(3) provided that Gajendragadka. J. inciting while on the premises a,ny worker to strike work shall be treated as misconduct. These two provisions in the draft have been modified by respon-dent 2 and the order thus modified provides that striking work illegally either siggly or with other workers or abetting, inciting, instigating or acting in furtherance of an illegal strike would be treated as misconduct. This modification also is consistent with the relevant provision in the model standing order. :Feeling aggrieved by the modifications made by respondent 2 in the draft submitted by them the appellants preferred an appeal to the Industrial court (hereinafter called respondent 1). Respondent l was not impressed by the contentions raised by the appel, !ants with the result that the modifications made by respondent 2 were confirmed and the appeal was dismissed.

Thereupon the appellants filed writ petition, being Miscellaneous Application No. 267 of 1954, in the Bombay High Court challenging the validity of the action of respondents 2 and 1. Mr Justice Coyajce, who heard the said application, upheld the contention raised by the appellants and came to the concluEion that in making the impugned modifications respon-dent 2 and respondent 1 had acted beyond their jurisdiction. The learned judge, therefore, set aside the modifications made and allowed the appellants' petition.

Against this order respondent 2 preferred an appeal, being Appeal No. 122 of 1954, before the Court of Appeal in the Bombay High Court. The appellate court reversed the decision of Coyajee J. and held that the action of respondents 2 and 1 in making the modifications in question was justified by the provi-sions ,of the Act. In the result the petition filed by the appellants was dismissed. It is against this deci-sion that the present appeal has been preferred by

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the appellants; and the short question which it raises z960 for our decision is: whether, under the provisions of Associated the Act, it was eompetent to respondents 2 and 1 to Cement co. Ltd. make the impugned modifications in the draft standing v. orders submitted by the appellants for certification P.D. Vyas under the Act?

The Act has been passed because it was thought Gajendragadkar l• "expedient to require employers in industrial establish; men ts to define with sufficient precision the conditions of employment under them and to make the said conditions known to workmen employed by them." Standing Orders are defined by s. 2(g) of the Act to mean rules relating to matters set out in the Schedule. The Schedule sets out 11 matters in respect of which standing orders are required to be made by the employers. Mr. Kolah, for the appellants, contends that the main object of the Act is to require the employers to provide for conditions of service in respect of all the matters covered by the Schedule, and, according to him, the jurisdiction of respondent 2 under the Act as it then stood is confined only to see that standing orders are made in respect of all th.e items specified in the Schedule. In this connection Mr. Kolah has strongly relied on the provision of s. 4 which then laid down inter alia that "it shall not be the function of the certifying officer or the appellate authority to adjudicate upon the fairness or reason-ableness of the provisions of any standing order". The argument is that the Act expressly prohibits itf respondent 2 or respondent 1 from enquiring whether any of the provisions made in the draft standing orders are fair or reasona;ble, and it is urged that, in making the modifications in question, in substance respondent 2 has embarked upon an enquiry about the reasonableness or fairness of the relevant condi-tions included in the draft. Thus presented the argument is no doubt attractive; but there are some other provisions in the Act which show that the argument based on the said provision of s. 4 cannot succeed. It is, therefore, necessary to consider the other provisions which are material. Before we do so, we would like to add that by subsequent amend-ment made in 1956 s. 4 now provides that it shall be

SUPREME COURT R,EPORTS [1960(2)]

z96o the function of the certifying officer or the appellate Associated authority to adJ'udicate upon the fairness or reason-Cement ca. Ltd. ableness of the provisions of any standing orders. v.. In other words, what was expressly excluded from P. D. Vyas the jurisdiction of the authorities under the Act has . - ,-now been clearly made their duty,_ and so the argu-Ga1endragadkar· f. ment based upon the provision as it stood in 1946 is, after the amendment of 1956, purely academic.

Section 3 of the Act requires the employer to submit draft standing orders. Section 3(2) provides that in the draft thus submitted provision sha,Jl be made for every matter set out in the Schedule which may be applicable to the industrial establishment, and where model standing orders have been prescrib-ed, shall be, so far as is practicable, in conformity with such model. It is common ground that model standing orders have been prescribed in the present case, and so it follows that under s. 3, sub s. (2) the draft submitted by the appellants had to be in con-formity with the morlel sanding orders so far as was practicable. In other words, the effect of s. 3 sub-s. (2) is that, unless it is shown that it is impracticable to do so, the appelfants' draft had to conform to the model. This position cannot be disputed. Then, the next relevant provision of the Act is contained in s. 4 which provides that standing orders shall be certifiable under this Act if (a) provision is made therein for every matter set out in the Schedule which is applic-able to the industrial est:>blishment, and (b) the standing orders are otherwise in conformity with the provisions of this Act. The rest of the provision of s. 4 has already been cited and considered by us. Having thus provided for the tests which have to be satisfied before draft submitted by the employer can be treated as certifiable, s. 5 provides for the procedure of the proceedings which are taken before the certi-fying officer. tlection 5 (2) lays down that after notice is given to the parties concerned the certifying officer shall decide whether or not any modification of, or addition to, the draft submitted by the employer is necessary to render tho draft standing orders certifiable under the Act, and shall. make an order in writing accordingly. Sub-section (3) of s. 5 then provides for

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certifying the draft after making modifications, if any, z96o under sub-s. (2). ·There is one more section to which Associated reference may be made. ·Section 15(2)(b) provides Cement Co. Ltd. that the rules which the appropriate government may v. make under the Act may set out model standing orders P. D. Vyas for the purposes of this Act. The cumulative effect of . -these provisions is that the certifying officer has to be Ga;endragadkar J. satisfied that the draft standing orders deal with every matter set out in the Schedule and are otherwise in conformity with the provisions of the Act. This latter requirement necessarily imports the considera-tion specified in s. 3, sub-s. (2), that is to say, the draft standing order must be in conformity with the model standing .order which is provided under s. 15(2)(b) for the purposes of th~ Aot, and, as we have already seen, unless it is shown that it would be· impracticable to do so, the draft standing order must be in conformity with the model standing order. It is quite true that this requirement does not: mean that the draft standing order must be in identical words but it does mean that in substance it must conform to the model prescribed by the appropriate government.The question which then arises is: was it or was it not open to resp-ondent 2 to consider whether the draft submitted by the appellants should not conform to the model standing order in respect of fihe topics with which we are concerned in the present appeal? The answer to this question must obviously be in the affirmative. It was not only open to respondent 2 to enquire into the matter but it was clearly his duty to do so before holding, that the draft orders were certifi-able under s. 4. Now such an enquiry necessarily involves: the consideration of the question as to whether it would be practicable to insist upon conformity with the model standing order in regard to the matters in dispute. If respondent 2 was satisfied that it would be practicable to insist upon such conformity it would be within his competence to make the suitable modi-fications in the draft. If, on the other hand, he took the"view that it would not be practicable to insist upon such conformity he would, despite the disparity between the model and the draft, treat the draft as certifiable .. In t~e present case respondent 2 a~ well

I96o as respondent 1 have held that it was practicable to Assoc-lated insist upon conformity with the model standing order Cement Co. Ltd. in regard to the matters in dispute; and so they have v. made suitable modifications. Having regard to the P. D. Vyas relevant provisions which we have just considered, it . -seems difficult to accept the plea that in making the Ga1endragadkar f. modifications in question respondent 2 and respon-dent 1 have exceeded their jurisdiction. It is important to make distinction between considerations of fair-ness or reasonableness which are excluded from the purview of the enquiry before respondent 2 and res-pondent 1 from considerations of practicability which are necessarily imported in such ·an enquiry. The line separating the one from the other may be thin but nevertheless it is firm and existing line which is statutorily recognised in the respective provisions of the Act. Respondent 2 may not modify the draft on the ground that its provisions are unfair or unreason-able but he can and must modify the draft in matters covered by the model standing order if he is satisfied that conformity with such model standing order is practicable in the circumstances of the case. In our opinion, therefore, the High Court was right in holding that the authorities under the Act had,acted within their jurisdiction in making the impugned modifications.

We may aow refer to the decisions to which our attention was invited by Mr. Kolah. In Guest, Kten, · Williams (Private) Ltd v. Sterling (P. J.) & Ors. ('}, this Court had occasion to consider the effect of part of the provision contained in s. 4 of the Act as it stood before its amendment in 1956. It is, however, clear that in that case the point raised for our decision now did not fall to be considered. In Electric W orlcers' Union v. The U.P. Electric Supply Go.('}, Mr. Justice Wanchoo, who was acting as the appellate authority under the Act, appears to have held that the provi-sion contained in s. 3(2) had nothing to do with the power of the certifying officer to substitute the model for the draft. According to the learned judge the said provision was intended merely to help and guide· the employers as to how they should frame their draft standing orders. This decision appa.rently supports (1) (1960) I S.C.R. 348 (2) A.I.R. 1949 All. 504.

the argument that the certifying officer cannot make r960 any changes in the pro.visions of the draft where those Associated provisions are clear on the ground that they are not cement co. Ltd. reasonable and fair and that other provisions which v. may have been provided in the model standing orders P.D. Vyas should be substituted for them. If, in making these . -observations, it was intended to decide that, before Ga_,endraga./kar J. certifying the draft standing orders submitted by the employer, the certifying officer cannot enquire and decide whether it would be practicable or not to ma.ke the provisions in the draft conform to the model standing orderi;;, with respect, we would hold that th~ said decision is inconsistent with the true effect of the relevant provisions of the Act. We may incidentally add that the observations made by Wanchoo J. in that case have not been approved by the Allahabad ~ High Court in Jiwan Mal & Co. v. Secretqry, Kanpur Loha Mills Karamchari Union & Ors. (1). In Mysore K irloskar Employees' Association v. Industrial Tribunal, Bangalore & Anr. ([2]), the Mysore High Court bas considered this question and it appears to have concurred more with the view expressed by the Bombay High Court which is the subject-matter of the present appeal than with the observations of Wanchoo J.

There is one more point to which reference must be made. Mr. Kolah attempted to argue before us that, even if the authorities under the Act had jurisdiction to deal with the matter and examine whether or not it was practicable to insist upon conformity with the model standing orders, the modifications made by them on the merits are impracticable. We have not allowed Mr. Kolah to urge t,his contention before us because such plea was not raised by the appellants in their petition for writ before the Bombay High Court, and it would not be open to them to raise it for the first time before us. Besides, in petition for writ of certiorari it would normally not be open to the appellants to challenge the merits of the findings made by the authorities under the Act.

The result is the app~al fails and is dismissed with costs.

Appeal dismissed (2) [1959] I L.L. J. 53r.

(1) A.I.R. 1955 All. 581.