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1961 Supreme(SC) 118

SUPREME COURT OF INDIA
17th March, 1961
P.B. GAJENDRAGADKAR, A.K. SARKAR, K.N. WANCHOO, K.C. DAS GUPTA, AND N. RAJAGOPALA AYYANGAR, JJ.
Swadeshi Cotton Mills Co. Ltd., Appellant
Versus
State Industrial Tribunal, U. P. and others, Respondents.
Civil Appeal No. 327 of 1958.
With
(2) (From Allahabad)*
R. J. Holley and others, Appellants
Versus
State of U.P. and others, Respondents.
Civil Appeals Nos. 363 to 369 of 1958. 1382
Advocates appeared
Mr. G. S. Pathak, Sr. Advocate (Mr. S. P. Varma, Advocate, with him), for appellant; (in C. A. No. 327 of 58); Mr. C. B. Agarwala, Sr. Advocate (M/s. G. C. Mathur and C. P. Lal, Advocates, with him), for Respondents Nos. 2 to 4 (in C. A. No. 327 of 58); Mr. J. P. Goyal, Advocate, for Respondent No. 5. Mr. H. N. Sanyal Addl. Solicitor-General for India (Mr. H. S. Brar, Advocate and M/s. S. N. Andely, J. B. Dadachanji, Rameshwar Nath and P. L. Vohra, Advocates of M/s. Rajinder Narain and Co. with him), for Appellants (In C. As. Nos. 363 to 369 of 58); M/s. Bhawani Lal and Dharam Bhushan, Advocates, for Respondent No. 4 (In C. A. No. 369 of 58); Mr. J. P. Goyal, Advocate, for Respondent No. 4 (In C. As. Nos. 366and 368 of 58); Mr. S. C. Das, in person for Respondent No. 4 (In C. A. No. 367 of 58).

Advocates:
BHAVANI LAL, C.B.AGARWAL, C.P.LAL, DHARAM BHUSHAN, G.C.MATHUR, G.S.PATHAK, H.N.SANYAL, H.S.BRAR, J.B.DADACHAN, J.P.GOYAL, P.L.VOHRA, RAJINDAR NARAIN, RAMESHWAR NATH ROY, S.C.DAS GUPTA, S.N.ANDLEY, S.P.Varma

The delegation of legislative power is not excessive if the legislature has chosen the legislative policy and has formally enacted that policy into a binding rule of conduct.

Headnote:
INDUSTRIAL DISPUTES - Constitutionality of S. 3 of the United Provinces Industrial Disputes Act, No. XXVIII of 1947 (hereinafter referred to as the Act) and the validity of two general orders passed thereunder on March 15, 1951.
Fact of the Case:

Industrial concerns challenged the constitutionality of S. 3 of the Act and the validity of two general orders passed on March 15, 1951, by which industrial tribunals were set up. The High Court held that S. 3 of the Act was constitutional but the two general orders were invalid. The appellants then filed petitions under Art. 226 of the Constitution in the Allahabad High Court challenging the constitutionality of S. 3 of the Act and the validity of the two general orders passed on March, 15, 1951, by which industrial tribunals were set up.
Finding of the Court:

The Supreme Court held that S. 3 of the Act was constitutional and the two general orders passed on March 15, 1951, were valid.
Issues: 1. Whether S. 3 of the United Provinces Industrial Disputes Act, No. XXVIII of 1947 (hereinafter referred to as the Act) is constitutional? 2. Whether the two general orders passed thereunder on March 15, 1951, are valid?
Ratio Decidendi: 1. The Supreme Court held that S. 3 of the Act was constitutional as it did not suffer from the vice of excessive delegation. The legislature had chosen the legislative policy and had formally enacted that policy into a binding rule of conduct. It had also indicated when the Government shall act under S. 3 and how it shall act. It had further indicated what it shall do when it acts under S. 3. 2. The Supreme Court held that the two general orders passed on March 15, 1951, were valid. The satisfaction of the condition precedent for the issue of an order under S. 3 of the Act was in fact there before the order No. 615 was passed on March 15, 1951, followed by the consequential order No. 671 of the same date. The defect in the two orders of March, 15, 1951, has been cured and it is clear that they were passed after the State Government was satisfied as required under S. 3 of the Act.
Final Decision: The appeals were dismissed.

Judgment

WANCHOO, J. : This group of appeals raises a question about the constitutionality of S. 3 of the United Provinces Industrial Disputes Act, No. XXVIII of 1947 (hereinafter referred to as the Act) and the validity of two general orders passed thereunder on March 15, 1951. The appellants are certain industrial concerns. There were disputes between them and their workmen which were referred for adjudication to industrial tribunals alleged to have been set up under the general orders on March 15, 1951. Certain awards were passed which were taken in appeal by the present appellants to the Labour Appellate Tribunal and they failed there also. They then filed petitions under Art. 226 of the Constitution in the Allahabad High Court challenging the constitutionality of S. 3 of the Act and the validity of the two general orders passed on March, 15, 1951, by which industrial tribunals were set up. The High Court held that S. 3 of the Act was constitutional . It however held that the two general orders dated March 15, 1951, were invalid; but it went on to hold that orders of reference passed in these cases were special orders as envisaged under S. 3 of the Act and were therefore not invalid; in consequence it dismissed the petitions. The appellants then applied for and obtained certificates for leave to appeal; and that is how the matter has come up before us.

2. It is unnecessary to set out the facts further in respect of these appeals, as the only points argued before us are about the constitutionality of S. 3 and the validity of the two general orders of 1951 and also of the references made in these cases. It is not disputed that if the appellants fail on these points their appeals in this Court must fail. We shall therefore first take up the question of the constitutionality of S. 3 of the Act.

3. The relevant provision of S. 3 in 1951 with which we are concerned was in these terms:-

"If, in the opinion of the State Government it is necessary or expedient so to do for securing the public safety or convenience, or the maintenance of public order or supplies and services essential to the life of the community, or for maintaining employment, it may, by general or special order, make provision-

* * * * * *

(d) for referring any industrial dispute for conciliation or adjudication in the manner provided in the order;

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(g) for any incidental or supplementary matters which appear to the State Government necessary or expedient for the purposes of the order:

* * * * * "

4. The main contention of the appellants is that S. 3 is unconstitutional as it delegates essential legislative function to the Government so far as cls. (c), (d) and (g) are concerned. Reliance in this connection is placed on the following observations of Kania, C. J. in In re The Delhi Laws Act, 1912, 1951 SCR 747 at p. 767 where he was considering the meaning of the word "delegation":-

"When a legislative body passes an Act it has exercised its legislative function. The essentials of such function are the determination of the legislative policy and its formulation as a rule of conduct. These essentials are the characteristics of a legislature by itself......Those essentials are preserved, when the legislature specifies the basic conclusions of fact, upon ascertainment of which, from relevant data, by a designated administrative agency, it ordains that its statutory command is to be effective. The legislature having thus made its laws, it is clear that every detail for working it out and for carrying the enactments into operation and effect may be done by the legislature or may be left to another subordinate agency or to some executive officer. While this also is sometimes described as a delegation of legislative powers, in essence it is different from delegation of legislative power which means a determination of the legislative policy and formulation of the same as a rule of conduct."

5. To the same effect were the observations o

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1961 Supreme(SC) 118

The delegation of legislative power is not excessive if the legislature has chosen the legislative policy and has formally enacted that policy into a binding rule of conduct.

Cases Referred (5)