TMI Blog2004 (4) TMI 528X X X X Extracts X X X X X X X X Extracts X X X X ..... l which arises out of the judgment and order dated 14.10.1999 passed by the High Court of Allahabad dismissing the writ petition filed by the appellants herein and allowing the writ petitions filed by the respondent-company herein. BACKGROUND FACTS: The appellant herein is a Trade Union registered under the Indian Trade Unions Act, 1926. The first respondent herein is an industrial establishment carrying on business in Engineering Industry. It admittedly employed more than 100 persons in its factory at Ghaziabad. A notice was issued by it on or about 21.9.1998 declaring its intention to close down the said factory at Ghaziabad with effect from 23.9.1998 as a result whereof it was notified that services of 99 workmen would be terminated. An industrial dispute was raised by the appellant herein on or about 23.9.1998 questioning the validity of the said notice raising a factual plea that more than 300 workmen are employed by the first respondent in its Ghaziabad establishment and, thus, the Industrial Disputes Act, 1947 (hereinafter referred to as the Central Act ) would be applicable. Pursuant to or in furtherance of the purported complaint made by the appellant herein, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the relevant provisions relating to closure are found in Chapter V-B of the Act covering Sections 25K to 25S. Section 25K, as it stands, provides that Chapter VB applies to industrial establishments employing not less than 100 workmen. Section 25O provides for the procedure for closing down an undertaking. Section 25S provides inter alia that Section 25J in Chapter V-A shall also apply in relation to an industrial establishment to which the provisions of Chapter V-B would apply. A reading of the said provision and in particular Sub-Section (2) thereof would show that the Central Act would govern the rights and liabilities of both the employers and the workmen insofar as they relate to layoff and retrenchment notwithstanding the State Act laying down provision to the contrary and in that view of the matter the Central Act shall be applicable. (ii) Reading Sections 25K and 25S of the Central Act along with Section 25J of the Central Act, it is clear that in relation to industrial establishments having more than 100 workmen, the rights of workmen in respect of layoff, retrenchment and closure would have to be decided as per the Central Act, regardless of any State law. Necessaril ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... brought into force with effect from 21.8.1984, the question of Presidential Assent of the State Act must be judged. Relying on Shyamakantlal Vs. Rambhajan Singh [1939 FCR 193], Ch. Tika Ramji Others etc. Vs. the State of Uttar Pradesh Others [1956 SCR 393], Municipal Council Palai Vs. T.J. Joseph and Others [(1964) 2 SCR 87], Kerala State Electricity Board Vs. Indian Aluminum Co. [(1976) 1 SCR 552] and Belsund Sugar Co. Ltd. Vs. State of Bihar and Others [(1999) 9 SCC 620], Mr. Banerjee would submit that at the material time when Presidential assent was obtained for the State Act in 1983, there was no repugnancy in fact but there existed merely a future possibility of repugnancy. Seeking to distinguish the decision of this Court in Rishikesh (supra) Mr. Banerjee would urge that the same was distinguished in M.P. Shikshak Congress and Others Vs. R.P.F. Commissioner, Jabalpur and Others [(1999) 1 SCC 396]. Furthermore, as it was held as of fact in Rishikesh (supra) that there did not exist any conflict, it was argued, the purported law laid down Clause (2) of Article 254 must be held to be a mere obiter. (vi) In any event before Clause (2) of Article 254 is applied, a finding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... V-A and, thus, Section 25J cannot be held to have formed a part of Chapter V-B. In any event, he would urge that even if Section 25S vis- -vis Section 25J have an overriding effect, the constitutional provisions contained in Clause (2) of Article 254 shall prevail thereover. ANALYSIS: The Central Act as also the State Act have been enacted in terms of Entry 22 of List III of the Seventh Schedule of Constitution of India. Both Acts were enacted in the year 1947. Chapter V-A of the Central Act relates to layoff and retrenchment which was inserted by Act No. 43 of 1953. Section 25J provides for effect of laws inconsistent with Chapter V-A of the Central Act. It had an overriding effect. The State Act was amended in the year 1957 providing for layoff and retrenchment. It is not in dispute that Section 6R of the State Act provides for effect of laws inconsistent with Sections 6J to 6Q and in terms of sub- Section (2) thereof, the provision of Section 6R shall be deemed not to affect the provision of any other law for the time being in force. The Parliament introduced special provisions relating to layoff, retrenchment and closure by inserting Chapter V-B in the Central Act in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to define and delimit the respective areas of legislative competence of the Union and State Legislatures. Since legislative subjects cannot always be divided into water tight compartments; some overlappings between List I, II and III of the Seventh Schedule is inevitable. As in a federal Constitution division of legislative powers between the Central and Provincial Legislatures exists, controversies arise as regards encroachment of one legislative power by the other particularly in cases where both the Union as well as the State Legislation have the competence to enact laws. Article 254 provides that if any provision of a law made by the Legislature of a State is repugnant to any provision made by the Parliament which Parliament is competent to enact, or to any provision of an existing law with respect to one of the matters enumerated in the Concurrent List then subject to provisions of clause (2), the law made by the Parliament shall prevail to the extent of the repugnancy required. In terms of clause 2 of Article 254 of the Constitution of India where a law made by the legislature of a State with respect to one of the matters enumerated in the Concurrent List contai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e effect of one Act over the other in the event it is found that there exists a conflict. For the said purpose, it is not necessary that the conflict would be direct only in a case wherein the provisions of one Act would have to be disobeyed if the provisions of the other is followed. The conflict may exist even where both the laws lead to different legal results. In Zaverbhai Amaidas (supra), it is stated: The principle embodied in Section 107 (2) and Article 254 (2) is that when there is legislation covering the same ground both by the centre and by the Province, both of them being competent to enact the same, the law of the Centre should prevail over that of the State. In M. Karunanidhi (supra) the fact of the matter was completely different. Therein the scheme of the two Acts was not in conflict with each other. This Court referred to Colin Howard s Australian Federal Constitutional Law, 2 nd Edition, Hume Vs. Palmer, 38 CLR 441 (Aus), Zaverbhai Amaidas (supra), Tika Ramji (supra), Deep Chand (supra) and State of Orissa Vs. M.A. Tulloch Co. [(1964) 4 SCR 461] opining: 1. That in order to decide the question of repugnancy it must be shown that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... subject matter (Victoria v. Commonwealth, (1937) 58 C.L.R. 618; Wenn V. Attorney-General (Vict.), (1948) 77 C.L.R. 84). Isaacs, J. In Clyde Engineering Company, Limited V. Cowburn laid down one test of inconsistency as conclusive : If, however, a competent legislature expressly or implicitly evinces its intention to cover the whole field, that is a conclusive test of inconsistency where another Legislature assumes to enter to any extent upon the same field . In a case, thus, where both the State Act and the Central Act have been enacted in terms of List III of the Seventh Schedule of the Constitution of India, the question of repugnancy as envisaged under Article 254 would arise. In that type of cases, it is well-settled that in absence of Presidential Assent, the Parliamentary Act would prevail and where the assent has been received, the State Act would. (See also M.P.A.I.T. Permit Owners Assn. Anr. Vs. State of Madhya Pradesh [2003 (10) SCALE 380]) The question again came up for consideration before a Constitution Bench of this Court in ITC Ltd. vs. Agricultural Produce Market Committee and Others [(2002) 9 SCC 232]. The majority applied Tika Ramji (supra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of List I, nor do we find any justification in the contention of the counsel appearing for the States and also different Market Committees that the provisions contained in Tobacco Board Act dealing with the growing of tobacco as well as making provisions for sale and purchase of tobacco, must be held to be beyond the legislative competence of Parliament, as it does not come within the so-called narrow meaning of the expression industry on the ground that otherwise it would denude the State Legislature of its power to make law dealing with markets under Entry 28, dealing with agriculture under Entry 14 and dealing with goods under Entry 27 of List II. Such an approach of interpretation in our considered opinion would be against the very scheme of the constitution and supremacy of Parliament and such an approach towards interpreting the power sharing devices in relation to entries in List I and List II would be against the thrust towards centralisation. In our considered opinion, therefore, the word industry in Entry 52 of List I should not be given any restricted meaning and should be interpreted in a manner so as to enable the Parliament to make law in relation to the subjec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion made by the Law Commission of India to shorten the litigation, Parliament made the Central Act to streamline the procedure. It is true that inconsistency in the operation of the Central and the State law would generally arise only after the respective Acts commenced their operation. Section 3(13) of the General Clauses Act defines commencement to mean the day on which the Act or Regulation comes into force. The Founding Fathers were cognizant to the distinction between making the law and commencement of the operation of the Act or Regulation. Article 254, clauses (1) and (2) and in a way Section 97 of the Central Act are also alive to the distinction between making the law and commencement of the law. In Collins English Dictionary, at p. 889 make is defined to mean, to cause to exist , to bring about or to produce . In Black s Law Dictionary, 6th Edn. at p. 955, make is defined as to cause to exist... to do in form of law; to perform with due formalities; to execute in legal form;... . The verb made in Article 254 brings out the constitutional emanation that it is the making of the law by the respective constituent legislatures, namely, Parliament and the State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operation is visualised by comparative study. It was further held: 18...The legislative business done by the appropriate State Legislature cannot be reduced to redundancy by the executive inaction or choice by the Central Government by issuing different dates for the commencement of different provisions of the Central Act. The Constitution, therefore, made a clear demarcation between making the law and commencement of the law which, therefore, bears relevance for giving effect to Article 254. It was, therefore, a case where having regard to the authority delegated to the executive the Act was to come into effect at a later date. In M.P. Shikshak Congress (supra), on the other hand, the Central Act had no application in relation to educational institution whereas the State Act did. Only by reason of a legislative action, the Act was extended to educational institutions and, thus, evidently, the question of repugnancy arose and not prior thereto upon the provisions of the Act being extended to a thitherto uncovered field. In M.P. Shikshak Congress (supra), the matter involved application of law whereas in Rishikesh (supra) the question was enforcement of an Act. Both s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consideration and assent . If there is no proposal, no question of consideration or assent arises. For finding out whether assent given by the President is restricted or unrestricted, the letter written or the proposal made by the State Government for obtaining assent is required to be looked into. The question, however, is to be considered having regard to the fact situation obtaining herein. The conflict between the Central Act and the State Act was apparent. The State of Uttar Pradesh inserted Section 6V by Act No. 26 of 1983 being conscious of the fact that an Act had been passed to the contrary by the Parliament in terms of Act No. 46 of 1982. So long Chapter V-B was applicable to an industrial establishment engaging 300 or more persons, the State did not insert any provision and allowed the Parliament to occupy the field relating to layoff, retrenchment and closure of industrial undertakings. Only when the number of workmen having regard to the legislative policy as would appear from the Statements of Objects and Reasons was brought down to 100 from 300 for the purpose of applicability of Chapter V-B of the Central Act, the amendment was brought in by the Stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t prevail over the State Act by taking recourse to the non-obstante clause. Non-obstante clause contained in Section 25J is, thus, required to be kept confined to Chapter V-A only and in that view of the matter we have no hesitation in holding that Chapter V-B does not have an overriding effect over the State Act. In any event, such a question could have arisen for consideration if the Central Act and the State Act had been enacted in terms of different entries of List I and List II of the Seventh Schedule of the Constitution of India. In this case, admittedly both the Central Act and the State Act had been enacted in terms of Entry 22 of List III of the Seventh Schedule of Constitution of India. In case of any conflict therefor the constitutional scheme contained in Article 254 will have to be applied. Even if Section 25S of the State Act is read to have an overriding effect, undoubtedly the provisions of the supreme lax shall prevail over a statute. A non-obstante clause contained in a statute cannot override the provisions of the Constitution of India. CONCLUSION: For the foregoing reasons, we are of the opinion that there is no merit in these appeals which are acc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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