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1993 Supreme(All) 226

IN THE HIGH COURT OF ALLAHABAD
R. R. K. Trivedi, J.
MODI INDUSTRIES LTD. - Appellant
Versus
ADDITIONAL LABOUR COMMISSIONER AND ORS. - Respondents
C. M. W. P. 6471 Of 1993
Decided On : 04/12/1993

Advocates Appeared:
RAKESH TEWARI

The proceedings under Section 3 of the U.P. Act of 1978 for the recovery of unpaid wages as arrears of land revenue were not barred by Section 22 of the Act of 1985, as the purpose of the Act of 1985 was to rehabilitate sick industries, but this could not be achieved without industrial peace, which required the timely payment of wages to workers.

Headnote:

INDUSTRIAL DISPUTE - UTTAR PRADESH INDUSTRIAL PEACE (TIMELY PAYMENT OF WAGES) ACT, 1978 - SECTION 3 - RECOVERY OF WAGES AS ARREARS OF LAND REVENUE - SICK INDUSTRIAL COMPANIES (SPECIAL PROVISIONS) ACT, 1985 - SECTION 22 - APPLICABILITY - WAGES OF WORKERS - PAYMENT - NON-OBSTANTE CLAUSE - INDUSTRIAL PEACE - MAINTENANCE - CONSTITUTION OF INDIA, ARTICLE 23 - BEGAR - PROHIBITION.

Fact of the Case:

Petitioner, a sick industry, challenged the orders passed by the Labour Commissioner under Section 3 of the Uttar Pradesh Industrial Peace (Timely Payment of Wages) Act, 1978 (U.P. Act of 1978), directing the Collector to recover the unpaid wages of workers as arrears of land revenue. The petitioner contended that the proceedings under the U.P. Act of 1978 were barred by Section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 (Act of 1985), which prohibited execution or distress against the property of a sick industrial company without the consent of the Board.

Finding of the Court:

The Court held that the proceedings under Section 3 of the U.P. Act of 1978 were not barred by Section 22 of the Act of 1985. The Court reasoned that the purpose of the Act of 1985 was to rehabilitate sick industries, but this could not be achieved without industrial peace, which required the timely payment of wages to workers. The Court further held that the non-payment of wages would amount to "begar" or forced labor, which is prohibited under Article 23 of the Constitution.

Issues: 1. Whether the proceedings under Section 3 of the U.P. Act of 1978 were barred by Section 22 of the Act of 1985? 2. Whether the non-payment of wages would amount to "begar" or forced labor?

Ratio Decidendi: 1. The Court held that Section 22 of the Act of 1985 did not bar the proceedings under Section 3 of the U.P. Act of 1978 because: - The purpose of the Act of 1985 was to rehabilitate sick industries, but this could not be achieved without industrial peace, which required the timely payment of wages to workers. - The non-payment of wages would amount to "begar" or forced labor, which is prohibited under Article 23 of the Constitution. 2. The Court held that the non-payment of wages would amount to "begar" or forced labor because: - Workers cannot be expected to work without payment of their wages. - The timely payment of wages is necessary to maintain industrial peace.

Final Decision: The Court dismissed the writ petitions, subject to the observation that the petitioner had to make payment of the whole amount covered by both the writ petitions, totaling 33 lakhs, by April 30, 1993. In case of default, the respondents were entitled to proceed with the recovery of the amount in accordance with law.

R. R. K. TRIVEDI, J.


( 1 ) IN the above petition, petitioner has challenged the order passed by respondent No. 1 by which he has forwarded to the Collector of the District a certificate under his signature specifying the amount of wages due from the petitioner for being recovered as arrears of land revenue. 5 In both the petitions counter and rejoinder affidavits have been exchanged and learned counsel for the parties have agreed that the petitions may be heard and decided finally at this stage.

( 2 ) BRIEF facts from which the aforesaid two petitions have arisen are that petitioners failed to pay the wages of the workers for the month of December, 1992 which ought to have been paid to them by 10th of the following month. The workers approached respondentno. 1 Additional labour Commissioner, for securing payment 5 of their wages. Respondents No. 1 acting under section 3 of the Uttar Pradesh Industrial Peace (Timely Payment of Wages) Act 1978 (hereinafter referred to as U. P. Act of 1978), gave a notice requiring petitioner to give information in Form 3 prescribed under Rule 4 (1) of the Rules framed under U. P. Act of 1978. The petitioner put in appearance and filed a reply raising various pleas justifying non-payment of the wages within time. Respondent No. l, however, disagreed with the contentions raised by petitioner and issued a certificate on February 10, 1993 for recovery of Rs. 13 Lakhs as arrears of ! land revenue in respect of wages for the month of December, 1992 which is subject matter of challenge in Writ Petition No. 4784 of 1993. Another certificate was issued on February 23, 1993 for Rs. 20 Lakhs in respect of wages of the 1 employees for the month of January, 1992 which has been challenged in Writ Petition No. 6471 of 1993. The question of facts and law in both the writ petitions are common with the only difference that they perta in to the payment of wages in respect of different months as mentioned above and both the writ petitions may be conveniently decided by a common judgment.

( 3 ) SHRI J. N. Tewari, learned counsel appearing for petitioner, has challenged the impugned orders passed by the respondent No. l on the following grounds:

( 4 ) FIRSTLY, it had been contended that respon- A dent No. 1 has failed to record reasons for not accepting various contentions raised on behalf of petitioners in their written objection filed in response to the show cause notice issued under Rule 4. It has been submitted by the learned counsel that where a reply is submitted in response to the show cause notice, reasons ought to be recorded by the authority concerned for not accepting the objection and as respondent No. 1 has failed to record the reasons, the impugned orders are vitiated. For this submission, learned counsel has relied on the case of Maharashtra State Board of Secondary and Higher Secondary education v. K. S. Gandhi and Ors. (1991)2 SCC 716.

( 5 ) SECOND submission of learned counsel for petitioner is that the industry of the petitioner has been declared sick under the provisions of Sick Industries Companies (Special Provisions) Act of 1985 (hereinafter referred to as Act of 1985) and the scheme for financial assistance and rehabilitation of petitioners factory is under consideration of the Board of Industrial Finance and reconstruction (in short B. I. F. R.) and the pro- i ceedings under the U. P. Act of 1978 are barred under Section 22 of the aforesaid Act, It has been submitted that the proceedings under U. P. Act of 1978 for the recovery of the amount as arrears of land revenue are covered by Section 22 of the Act of 1985 and respondent No. 1 could not legally proceed in view of the non-obstante provision contained in Section 22 without first obtaining the consent of the Board. In support of this submission learned counsel has placed reliance on cause: (1) Maharashtra Tubes Ltd. v. State Industrial and Investment Corporation of Maharashtra Ltd. and Ors. JT 1993 (1) SC 310 (2) S/s Shri Chamundi Mopeds Lt



















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