TMI Blog1965 (12) TMI 137X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant is a Joint Stock Company incorporated under the Companies Act, and it has its registered office at Allahabad.The principal object for which this Company has been incorporated is to carry on the business of generation and distribution of electricity. In accordance with the provisions of the Industrial Employment (Standing Orders) Act, 1946 (No. 20 of 1946) (hereinafter called 'the Act'), the appellant prepared draft Standing Orders in consultation with its employees and submitted the same to the Certifying Officer on the 24th December, 1950, for certification. At that time, the workmen employed by the appellant had not formed any Union, and so, the Labour Department held proceedings for the election of the three representatives from the said workmen. Normally, a Union representing the workmen would have been competent and qualified to represent the workmen in the certification proceedings; but since there was no Union in existence, the Labour Department had to adopt, the expedient of asking the workmen to elect three representatives. That is how respondents 3 to 5 came to be elected as the representatives of workmen. In the certification proceedings, these representat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after called 'the Central Act') ,or of the U.P. Industrial Disputes Act, 1947 (No. 28 of 1947) (hereinafter called 'the U.P. Act'). Before dealing with this point, it is necessary to indicate the broad features of the Act. The Act was passed on the 23rd April, 1946, and the Standing Orders framed by the U.P. Gov- ernment under S. 15 of the Act were published on the 14th May, 1947. The Central Act came into force on the 1st April, 1947, whereas the U.P. Act came into force on the 1st February, 1948. It will thus be seen that the Act came into force before either the Central Act or the U.P. Act was passed. The scheme of the Act originally was to require employers in industrial establishments to define with sufficient precision the conditions of employment under them and to make the said conditions known to the workmen employed by them. The Legislature thought that in many industrial establishments, the conditions of employment were not always uniform, and sometimes, were not even reduced to writing, and that led to considerable confusion which ultimately resulted in industrial disputes. That is why the Legislature passed the Act making it compulsory for the establi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are permitted to apply for the modification of the said Standing Orders after the expiration of 6 months from the date of their coming into operation. It will thus be seen that when certification proceedings are held before the certifying authorities, the reasonableness or the fairness of the provisions contained in the draft Standing Orders falls to be examined. That is one aspect of the matter which has to be borne in mind in dealing with Mr. Setalvad's contention. The second aspect of the matter which is relevant on this point is that the Standing Orders have to cover the matters specified in the Schedule attached to the Act. Item 1 1 in the said Schedule refers to any other matter which may be prescribed. We have already mentioned the fact that s. 15 confers power on the appropriate Government to make rules. Section 15 (2) (a) provides that the appropriate Government may, by rules, prescribe additional matters to be included in the Schedule, and the procedure to be followed in modifying Standing Orders certified under this Act in accordance with any such addition. Thus there can be no doubt that the Act contemplates that the Standing Orders must cover matters initially i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rred for adjudication to the Industrial Tribunals. Thus, an elaborate machinery has now been established by the U.P. Act for the purpose of dealing with industrial disputes concerning the matters specified in the First and the Second Schedules to the U.P. Act. That is why any attempt which the certifying authorities may purport to make in devising elaborate provisions in respect of matters covered by the First or the Second Schedule of the U.P. Act, would trespass upon the provisions of the said Act, and in that sense, would be invalid. Let the operation of the Act be confined to its original form and no further; that, in substance, is the general point raised by Mr. Setalvad before us. We are not inclined to accept this contention. In substance, the argument proceeds on the assumption that there is a conflict between the Act and the U.P. Act. Since we are not satisfied that there is any such conflict, it is not necessary for us to consider what would have been the result if we had taken the view that there was any such conflict between the said two Acts. The schemes of the two Acts are in essence different in character. The Act purports to secure to industrial employees clear and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rgument is that in certifying the Standing Orders the appropriate authorities may, no doubt, compare them with the Model Standing Orders, but they need not insist upon strict compliance with them. He also suggested that it would be open to the employers to include matters in the Standing Orders which may not strictly be included in the Schedule. In this connection, he relied on the fact that the draft Standing Orders which the appellant had submitted for certification, had been assented to by the employees. In our opinion, this contention is misconceived and, must be rejected. The consent of the employees is, no doubt, a relevant factor which the certifying authorities may bear in mind in dealing with the question as to the fairness or reasonableness of the said Orders. If both the parties agree that certain Standing Orders submitted for certification are fair and reasonable, that, no doubt, is a consideration which the appropriate authority must take into account; but clearly, the appropriate authority cannot be denied the jurisdiction to deal with the matter according to its own judgment. It is for the appropriate authority to decide whether a particular Standing Order is fair or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Standing Order must necessarily refer both to provident fund and gratuities, and other welfare schemes. It is well known that the introduction of these amenities in industrial establishments involves financial liabilities for the employers, and the decision as to whether these amenities should be introduced or not, depends upon a consideration of several relevant factors; and so, if the additional items are included in the Schedule, and they appear to overlap or cover the same or similar ground, the appropriate authorities may, for good reasons, take the view that the provision need not be made for each one of those items. This position has not been seriously disputed before us by Mr. Agarwal for respondent No. 1. He has fairly conceded that it is not obligatory on the employer to have a scheme ,for provident fund as well as gratuity in every case. Thus, the true position appears to be that under s. 3 (2) of the Act the employers have to frame draft Standing Orders and they must normally cover the items in the Schedule to the Act. If, however, it appears to the appropriate authorities that having regard to 'the relevant facts and circumstances, it would be unfair and unreas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry out the purposes of the Act; and s. 15(2) specifies some of the matters enumerated by clauses (a) to (e), in respect of which rules may be framed. It is well-settled that the enumeration of the particular matters by sub-s. (2) will not control or limit the width of the power conferred on the appropriate Government by sub-s. (1) of s. 15; and so, if it appears that the item added by the appropriate Government has relation to conditions of employment, its addition cannot be challenged as being invalid in law. Whether or not such addition should be made, is, a matter for the appropriate Government to, decide in its discretion. The reasonableness of such addition cannot be questioned, because the power to decide which additions should be made has been left by the Legislature to the appropriate Government. Having regard to the development of industrial law in this country during recent years, it cannot be said that gratuity or provident fund is not a term of conditions of employment in industrial establishments. Similarly, it would be difficult to sustain the argument that the age of superannuation or retirement is not a matter relating to the conditions of employment. Therefore, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e a term of retirement in the conditions of service without making any provision for a suitable retiral benefit; but such a provision cannot be made suo Moto by the appropriate authority under item 11C; it has to be made either at the initiative of the employer, or by consent of parties. Mr. Setalvad did not dispute the position that it would be equitable to make some suitable provision for retiral benefit to the employees, particularly the existing employees, if an age of superannuation or retirement is going to be fixed for the first time in this establishment. He was, therefore, prepared that the whole of certified S.O. No. 54 should be deleted and the matter of retire- ment of the employees should be left to be determined under the existing practice. It is common ground that under the existing practice, there is no age of superannuation or retirement. The next certified Standing Orders which are challenged by Mr. Setalvad are in regard to the payment of compensation for lay-off ; they are Nos. 29 and 30. Clause (a) of the certified S.O. 29 reads thus:- The employer may at any time or times, in the event of a fire, catastrophe, break-down of machinery or stoppage of p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vad referred us to s. 6K of the U.P. Act. Section 6-R(1) provides that the provisions from section 6-J to 6-Q shall have effect notwithstanding anything inconsistent therewith contained in any other law (including Standing Orders) made under the Industrial Employment (Standing Orders) Act, 1946. There is a proviso to this sub-section which is also relevant. It says that nothing contained in this Act shall have effect to derogate from any right which a workmen has under the Minimum Wages Act, 1948, or any notification or order issued thereunder or any award for the time being in operation or any contract with the employer. It is clear that the proviso cannot cover the cases of Standing Orders which are expressly included in s. 6-R(1). It is true that the Standing Orders, when certified, in substance embody statutory conditions of employment, but they cannot be treated as a contract within the meaning of the proviso. The context obviously negatives such a construction; and so, if the point raised by Mr. Setalvad had to be decided solely by reference to the provisions of s. 6-K and 6-R, there would have been considerable force in his argument. But the difficulty in accepting Mr. Setal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or lay-off, will prevail over the provisions of the Central Act. We ought to add in fairness that as soon as this aspect of the matter was brought out in the course of arguments, Mr. Setalvad conceded that his contention against the validity of certified Standing Order 30(a) could not be pressed. A somewhat similar question was raised before this Court and has been considered in Workers of Dewan Tea Estate and Others v. Their Management([1964] 1 L.L.J. 358.). There is one more point which still remains to be considered. In this connection, the controversy centres round certified Standing Orders 47, 48 and 49. These Standing Orders purport to have been made under item 10 of the Schedule to the Act. Item 10 refers to the means of redress for workmen against unfair treatment or wrongful exactions by the employer or his agents or servants. Standing Order 47 deals with the procedure for enquiring into complaints. The substantive part of this Standing Order is not in dispute; what is challenged is the validity of the two provisos to the said Standing Order, and the whole of Standing Orders 48 and 49. The first proviso to S.O. 47 gives a right to the complainant workman to appeal to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies either by the workmen or the employer. The Standing Orders which fall within the contemplation of the Act, are intended to regulate the conditions of service of the employees, and in that behalf they may legitimately make provisions concerning the rights and liabilities of the parties and their enforcement by an internal arrangement which can be regarded as a domestic arrangement between the employer and his employees. It is not permissible under the Act to introduce appeals to outside authorities, and thereby extend the scope of the provisions which can legitimately be made by the Standing Orders. Besides, on the merits, Standing Order 48(a) (2) seems to be unfair inasmuch as it does not give a right of appeal to the employer in regard to decisions reached by the Joint Disciplinary Committee under S.O. 48 (a) ( 1 ) even though the employer may feel aggrieved by them. Likewise, the finality assigned to the decision of the Labour Commissioner by S.O. 49 would plainly be inconsistent with the provisions of the U.P. Act inasmuch as disputes arising from matters covered by the decision of the Labour Commissioner are completely taken out of the purview of s. 4-K of the said Act; ..... X X X X Extracts X X X X X X X X Extracts X X X X
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