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PATNA HIGH COURT
B.N.Agrawal and Indu Prabha Singh JJ.
Vishnu Sugar Mills Limited
Versus
State Of Bihar
Civil Writ Jurisdiction Case No. 3017 of 1988 ;
Decided On : OCTOBER 09, 1998
FACTORIES ACT - WELFARE OFFICERS - CONDITIONS OF SERVICE - RULES - VALIDITY - Retrospective effect - Power of State Government - Retrospective amendment of rules prescribing pay-scales and allowances of Welfare Officers - Validity - Equality before law - Discrimination - Article 14 of the Constitution of India.
Fact of the Case:
The petitioners, different Sugar Mills within the State of Bihar, challenged the validity of Sub-rules (2) and (5) of Rule 6 of the Bihar Factories Welfare Officers Rules, 1952, as substituted by Government notification, dated April 27, 1994, and that portion of Government notification, dated May 20, 1985, whereby the revised scale of pay prescribed under Sub-rule (1) of Rule 6 was made effective from a retrospective date, that is, April 21, 1981.
Finding of the Court:
The Court held that the State Government was empowered to frame rules not only with regard to duties and qualifications of Welfare Officers but regarding other conditions of service as well, including fixation/revision of pay-scales and dearness and other allowances. However, the Court held that the State Government was not justified in making the amendments in Rule 6 with retrospective effect, as it was not empowered to do so under the Factories Act, 1948. The Court also held that the provision in Sub-rule (5) of Rule 6, whereby Government rate of DA was made admissible to Welfare Officers, was violative of Article 14 of the Constitution of India as it was arbitrary and discriminatory.
Issues: 1. Whether the State Government was empowered to frame rules regarding conditions of service of Welfare Officers, including fixation/revision of pay-scales and allowances? 2. Whether the State Government was justified in making the amendments in Rule 6 with retrospective effect? 3. Whether the provision in Sub-rule (5) of Rule 6, whereby Government rate of DA was made admissible to Welfare Officers, was violative of Article 14 of the Constitution of India?
Ratio Decidendi: 1. The Court held that the expression "conditions of service" as used in Sec. 49(2) of the Factories Act, 1948, includes fixation/revision of pay-scales and dearness and other allowances, based on the following grounds: a) The definition of "wages" in the Industrial Employment (Standing Orders) Act, 1946, includes "wages including the period and mode of payment". b) The Industrial Disputes Act, 1947, provides for adjudication of wages, compensatory allowances, etc., and classification by grades. c) Previous case law has held that the expression "conditions of service" includes pay-scales and allowances. 2. The Court held that the State Government was not justified in making the amendments in Rule 6 with retrospective effect, as it was not empowered to do so under the Factories Act, 1948. The Court relied on the following principles: a) A delegatee has no jurisdiction to frame a rule from a retrospective date if such a power is not delegated to it by the statute either in express terms or by necessary implication. b) The State Government was not empowered to frame rules with retrospective effect under Secs. 49(2), 112, and 115 of the Factories Act, 1948. 3. The Court held that the provision in Sub-rule (5) of Rule 6, whereby Government rate of DA was made admissible to Welfare Officers, was violative of Article 14 of the Constitution of India as it was arbitrary and discriminatory. The Court relied on the following grounds: a) The Welfare Officers and other officers of similar rank in the Sugar Mills are not comparable with officers of the same rank employed in the State Government. b) The Government rate of DA is not a reasonable basis for determining the DA payable to Welfare Officers. c) The action of the State Government in treating the Welfare Officers with officers of same rank employed in the State Government, who are not comparable with each other is discriminatory, as two unequals have been treated as equals for the purpose of adopting Government rate of DA for Welfare Officers.
Final Decision: The Court allowed all the writ applications except Civil Writ Jurisdiction Case No. 3017 of 1988 and struck down Sub-rules (2) and (5) of Rule 6 of the Rules, as amended by Government notifications, dated April 27, 1994, as invalid. The Court also allowed Civil Writ Jurisdiction Case No. 3017 of 1988 and struck down that portion of Government notification, dated May 20, 1985, whereby the revised scale of pay prescribed under Sub-rule (1) of Rule 6 was made effective from a retrospective date, that is, April 21, 1981, as invalid.
B.N.Agrawal, J.
1. All the writ applications except Civil Writ Jurisdiction Case No. 3017 of 1988 have been filed for quashing Sub-rules (2) and (5) of Rule 6 of the Bihar Factories Welfare Officers Rules, 1952 (hereinafter referred to as rules), as substituted by Government notification bearing S.O. 119, dated April 27, 1994 contained in Annexure 1, whereas in Civil Writ Jurisdiction Case No. 3017 of 1988 prayer has been made for quashing that portion of Government notification, dated May 20, 1985, contained in Annexure 1, whereby the revised scale of pay prescribed under Sub-rule (1) of Rule 6 of the Rules has been made effective from April 21, 1981.
2. The short facts are that the petitioners in these writ applications are different Sugar Mills within the State of Bihar employing Welfare Officers as required under Sec. 49(1) of the Factories Act, 1948 (hereinafter referred to as Act), 1948. Under Sec. 49(2) of the Act the concerned State Government is required to prescribe the duties, qualifications and conditions of service of Welfare Officers employed under Sub-sec. (1) of Sec. 48 of the Act. Under Sec. 112 of the Act the concerned State Government is empowered to make rules providing for any matter to give effect to the purpose of the Act. Under Section 115 of the Act every rule made under the Act, which is required to be published in the Official Gazette, is required to be laid before the State Legislature. Purporting to Act under Sec. 49(2) read with Sec. 112 of the Act, the Bihar Government framed the Rules in the year 1952, Rule 6 whereof prescribed grades and scales of pay together with dearness and other allowances payable to Welfare Officers, which rule was amended from, time to time. By notification, dated May 20, 1985, issued by the State Government, contained in Annexure 1 to Civil Writ Jurisdiction Case No. 3017 of 1988. Rule 6 of the Rules was substituted prescribing revised scale of pay of Welfare Officers making the same effective from retrospective date, that is, April 21, 1981. The substituted Rule 6 of the Rules reads thus:
"6. The grades of Welfare Officers and their pay-scales.- (1) There shall be the following grades of Welfare Officers with the minimum scale of pay as mentioned against each grade namely: (a) Grade III Rs. 880-35-1,370-45-1,510
(b) Grade II Rs. 1,000-50-1,700-60-1,820
(c) Grade I Rs.1,575-50-1,775-75-2,300
(d) Selection grade Rs. 1,900-75-2,500
The revised pay-scale shall come into force from April 1981:
Provided that the existing Welfare Officers shall draw as initial pay at the stage in the revised scale of the post next above the amount arrived at by adding 15 per cent (fifteen per cent) of his substantive pay in the old scale subject to the minimum of Rs. 60 and maximum of Rs. 75 to his substantive pay but no employee shall be placed below the maximum in the revised pay-scale of the grade to which he belongs. All disputes relating to the fitment in the revised scale of pay shall be referred to the Chief Inspector of Factories, Bihar, whose decision in this regard shall be final.
(2) Over and above, the scale of pay prescribed in Sub-rule (1) every Welfare Officer shall be entitled to get dearness and other allowance and such other benefits and privileges under any scheme or otherwise as may admissible to officers or employees of similar rank or status or receiving similar scale of pay in the establishment to which the Welfare Officer belongs."
3. Thereafter by another notification, dated April 27, 1994, issued by the Bihar Government, further amendments were made in Rule 6 of the Rules and thereby the existing Rule 6 was substituted. Under the substituted Sub-rule (1) of Rule 6 of the Rules pay-scale was revised and under Sub-rule (2) the same was made effective from a retrospective date, that is January 1, 1986. Under Sub-rule (5) dearness allowance (hereinafter referred to as DA) admissible to the State Government servants employed in such scales from time to time for th
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