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2009 Supreme(Kar) 402
HIGH COURT OF KARNATAKA
THE HONOURABLE MR. JUSTICE SUBHASH B. ADI
The Karnataka Planters’ Association Spencer Road, Chikmagalur Others
Versus
State of Karnataka Department of Labour, by its Secretary & Others
Writ Petition No.10663 of 2008 (L-MW)
Date of Judgment : 26-06-2009
For the Petitioner:A.G. Holla, Sr. Advocate for P.D. Vishwanath, Advocate. For the Respondents:R1-R2, Jagdeesh Mundargi, GA, R3-R6, M/s. M.C. Narasimhan Associates, R7, T.S. Anantharam, R8-10, D. Leelakrishna, M.A. Appaiah, Advocates.
Headnote:MINIMUM WAGES ACT, 1948 - Section 5 & Karnataka Minimum Wages Rules, 1958, Rule 24(2): [Subhash B. Adi, J] Procedure for fixing and revising minimum wages - State Government fixed minimum wages at Rs. 84.50 paise under provisions of Section 5(1) of the Act - Points arose for consideration: (1) Whether the revision of minimum wages as per notification dated 25.3.2008 published in Official Gazette on 24.4.2008 is contrary to the provisions of the Minimum Wages Act and Rules made there under? (2) Whether the notification suffers from violation of provisions of Section 5(2) of the Act? (3) Whether the Court can interfere with the fixation of minimum wages? - Held, Fixing of minimum wages is one of the directive principles of State policy wherein the State shall endeavour to secure by suitable legislation or economic organisation or in any other way to all the workers, agricultural, industrial or otherwise, a living wage, conditions of work ensuring a decent standard of life and full enjoyment of leisure and social and cultural opportunities. The object behind directive policy under Article 43 of the Constitution of India is to secure economic and social justice to the people of India. It is in this regard, Act envisages that, minimum rate of wages should be fixed in respect of scheduled employment, keeping the objects of providing sustenance and preserving his efficiency as a worker in view. In the background of Articles 39, 39(e), 42 and 43 of the Constitution requires that, the State must endeavour to make policy towards securing the right to an adequate means of life to the citizens of the country. It is in this background, several amendments have been brought into the provisions of the Act. No doubt, there is no definition of minimum wages. Obviously, the minimum wages cannot be defined, it has to be determined depending upon the various circumstances and class of employment. Section 3 deals with fixing of minimum rate of wages. It mandates that the appropriate Government shall fix the minimum rate of wages payable to employees employed in different employment specified in Part I and Part II of the Schedule. Section 3(1)(b) of the Act provides for review at such interval as it may think fit and such intervals not exceeding five years. One must keep in mind that, for fixing the minimum wages, State is only discharging its constitutional obligation imposed upon it under the directive principles of State policy. This is a constitutional duty towards the economically weaker section of the society and cannot be allowed to be defeated on a theory of capacity of the industry to pay, which is a judicial blast placed on the meaning of Article 19(1)(f) and 19(1)(g) of the Constitution of India. Capacity of an industry to pay has no application to exercise power by the State in fixing the minimum wages. State in issuing notification under Section 5 exercises the legislative power and there is no requirement for the State to give reasons for its decision. Even taking into considering of various aspects of the matter and taking into consideration the provisions of Sections 3,4,5,7,8 and 9 of the Act read with Rule 24 of the Rules and in the light of the decisions of the Apex Court, the State Government has fairly and reasonably exercised its power conferred under Section 5(1)(b) and there is compliance with the provisions of Section 5(2) Proviso, as there is no counter proposal by the Advisory Board and Advisory Board has also deliberated on the issue. Even assuming that there are any technical error, broadly when the minimum rates of wages is fixed by the impugned notification and being most reasonably fixed after nine years, High Court cannot sit in appeal over the decision of the Government and particularly in the matter of fixation of minimum wages, the scope of interference by High Court under Article 226 being limited and the points raised by the petitioners do not make out any case of arbitrary or capricious decision by the State nor the notification is in violation of the provisions of the Act or the Rules made thereunder, there is no merit in the contention.
(This Writ Petition is field under Articles 226 & 227 of the Constitution of India praying to quash the notification dt.25.03.2008 published in Karnataka Gazette Dt.24.04.2008 vide Anx-K revising the minimum wages to the Workers (Mazdoors) employed in Cincona, Rubber, Tea and Coffee Plantations in the State of Karnataka, etc.,.)
This Writ petition is directed against the notification No. KAAE-11 LMW 2004 dated 25.3.2008 published in Karnataka Gazette dated 24.4.2008 produced at Annexure-K.
2. Petitioner No.1 is an Association of Planters established in the year 1958. Petitioners2 and 3 are the members of the first petitioner. There are about 4,67,000 labourer employed in Coffee estates in Karnataka and their wages are fixed under the provisions of Section 5 sub-section (1) of the Minimum Wages Act, 1948 (hereinafter referred to as ‘the Act’). state Government by notification dated 19.2.2004 had published a draft notification calling for objections, wherein the State Government had indicated the minimum wages for the workers working in Cincona, Rubber, Tea, coffee and mixed plantations at Rs.70.10 paise. In response to the same, the first petitioner No.1-Association had filed a statement of objections as per Annexure-B. In this regard, the State Government had constituted an Advisory Board (hereinafter referred to as ‘the Board’) under the chairmanship of second respondent and the said Board had convened several meetings and had submitted its recommendation. The State Government by its notification dated 25.3.2008 revised the minimum wages of the workers in Cincona, rubber, tea and coffee plantation at Rs.84.50 paise as per Annexure-K. While determining the minimum wages, the average Consumer Price Index (C.P.I) was taken at 2967 points and provided for payment of Dearness Allowance at 3 paise per point per day for every increase in points over the State Consumer Price Index. Applying the said price, the State Government has fixed the minimum wages at Rs.84.50 paise.
3. The case of the petitioners is that, in a notification issued in 1999, the basic minimum wages was fixed at Rs.52/- and the said sum was determined by adding Dearness Allowance at 2 paise for the earlier basic wages i.e., Rs.40/- for the year 1996 and addition of 5% to the same. The earlier practice followed by the State was that, basic minimum wages under the impugned notification at Rs.52/- with merger of V.D.A. (Variance Dearness Allowance) from 1980.5 to 2967 i.e., 25 paise per point i.e., Rs.24.66 paise, in all, Rs.76.66 paise + 5% increase as per practice i.e., Rs.3.83 paise, total Rs.80.49 paise, rounded off to Rs.80.50 paise, but as a result of wrong calculation arbitrarily done by the impugned notification, the minimum wage is fixed at Rs.84.50 paise. The said decision of fixing the minimum wages was questioned by the employers in W.P.No.17636/2004 and connected matters. This Court held that, the said determination was not in accordance with the provisions of the Act and Rules made thereunder and directed the authorities to re-consider the matter.
4. While the said Writ Petition was pending, the Board took up the matter for discussion and the proceeding dated 3.8.2006 of the Advisory Board discloses that, the discussion about the V.D.A. was deferred as the matter was pending before this Court and as such no discussion took place. However, arbitrarily, in violation of mandatory provisions of the Act and Rules made thereunder, the Government issued notification under Section 5(1)(b) of the Act, fixing the minimum wages as per Annexure-K. The State has not made proper consultation with the Board and the procedure followed in fixing the minimum wages is contrary to the prevailing practice and the law. It is also stated that, minimum wages and Dearness Allowance are fixed as one package and there cannot be two separate method of calculation, one for Dearness Allowance and another for basic wages. The wages are paid per day, which includes weekly r
