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1965 Supreme(All) 113
Allahbad High Court
satishchandra
Rashtriya Chini Mill Mazdoor Union - Appellant
Versus
State of U. P. - Respondent
Decided On : 08/25/1965
K.N. Singh, for Petitioners; Standing Counsel, for Opposite Parties.
The Court held that the notification issued by the State Government under Section 3(b) of the U. P. Industrial Disputes Act, 1947, directing payment of bonus to employees of sugar factories was not void as it did not infringe Art. 14 of the Constitution, that the State Government was not required to refer the dispute to an Industrial Tribunal for adjudication as the conditions precedent for such a reference were not satisfied, that the notification was not made in colourable exercise of power, that it did not violate the principles of natural justice, and that it did not violate the proviso to Section 3(b).
Headnote:
INDUSTRIAL DISPUTES ACT - SECTION 3(B) - U. P. INDUSTRIAL DISPUTES ACT, 1947 - SECTION 3(B) - VALIDITY - NOTIFICATION DIRECTING PAYMENT OF BONUS TO EMPLOYEES OF SUGAR FACTORIES - CHALLENGE - GROUNDS - VOID AS INFRINGING ART. 14 OF THE CONSTITUTION - NOT REFERRING THE DISPUTE TO INDUSTRIAL TRIBUNAL FOR ADJUDICATION - COLOURABLE EXERCISE OF POWER - VIOLATION OF PRINCIPLES OF NATURAL JUSTICE - VIOLATION OF PROVISO TO SECTION 3(B) - HELD, NOT SUSTAINABLE.
Fact of the Case:
Petitioners, two sugar mills, challenged the validity of a notification issued by the State Government under Section 3(b) of the U. P. Industrial Disputes Act, 1947, directing payment of bonus to employees of sugar factories. They contended that the notification was void as it infringed Art. 14 of the Constitution, that the dispute should have been referred to an Industrial Tribunal for adjudication, that the notification was made in colourable exercise of power, that it violated the principles of natural justice, and that it violated the proviso to Section 3(b).
Finding of the Court:
The Court held that the notification was not void as it did not infringe Art. 14 of the Constitution. It further held that the State Government was not required to refer the dispute to an Industrial Tribunal for adjudication as the conditions precedent for such a reference were not satisfied. The Court also held that the notification was not made in colourable exercise of power, that it did not violate the principles of natural justice, and that it did not violate the proviso to Section 3(b).
Issues: 1. Whether the notification was void as it infringed Art. 14 of the Constitution? 2. Whether the State Government was required to refer the dispute to an Industrial Tribunal for adjudication? 3. Whether the notification was made in colourable exercise of power? 4. Whether the notification violated the principles of natural justice? 5. Whether the notification violated the proviso to Section 3(b)?
Ratio Decidendi: 1. The Court held that the notification was not void as it did not infringe Art. 14 of the Constitution, as it was based on a reasonable classification of sugar factories. 2. The Court held that the State Government was not required to refer the dispute to an Industrial Tribunal for adjudication as the conditions precedent for such a reference were not satisfied, as there was no acute emergency. 3. The Court held that the notification was not made in colourable exercise of power, as the State Government had formed the requisite opinion that it was necessary to pass the order to secure the public convenience and the maintenance of public order and supplies and services essential to the life of the community and for maintaining employment. 4. The Court held that the notification did not violate the principles of natural justice, as the function under Section 3(b) of the U. P. Industrial Disputes Act was an administrative function and not a judicial or quasi-judicial function. 5. The Court held that the notification did not violate the proviso to Section 3(b), as the payment of bonus was an yearly feature and the exact amount payable varied according to various factors, and thus the specific amount could not be a condition of employment.
Final Decision: The Court dismissed the petitions with costs.
2. The impugned notification dated 1-5-62 purports to have been passed by the State Government in exercise of the powers conferred by section 3 of the U. P. Industrial Disputes Act, 1947 (U. P. Act No. XXVIII of 1947). It directs 69 named vacuum pan sugar factories to pay to their employees amounts, by way of bonus for the crushing season 1960-61, shown against their names, within one month of the publication of the order. The Punjab Sugar Mills Co., Ltd., Gorakhpur is mentioned at serial No. 63 of the order and the amount of bonus to be paid by it is shown to be nil. The Shankar Sugar Mills Ltd., Deoria is at serial No. 64 and it has also to pay nil as bonus. Several other sugar mills have also been directed to pay nil as bonus whereas a large number of others have been directed to pay various amounts mentioned against their names as bonus.
3. For the petitioners the first point urged was that section 3 (b) of the U. P. Industrial Disputes Act which is the source of power for making the impugned notification is void as it infringes Art. 14 of the Constitution. This point has been negatived by me in Writ Petn. No. 2357 of 1959, Mahalakshmi Sugar Mills Co. Ltd., New Delhi v. State of Uttar Pradesh, Dt. 13-7-1965 (All).
4. The learned counsel next urged that an industrial dispute with respect to the payment of bonus being in existence or at least apprehended, the State Government ought to have referred it for adjudication under section 4-K of the U. P. Industrial Disputes Act, and since that has not been done a mandamus should go compelling it to make the reference. Under the impugned notification the question of bonus for the whole sugar Industry of the State of Uttar Pradesh was settled. There are 69 sugar factories in the State which are vitally affected by the impugned notification. If the petitioners wanted seriously to raise this question, they should have impleaded those sugar factories as parties in these petitions. In their absence the question whether the State Government was justified in not referring this dispute to the Industrial Tribunal for adjudication cannot effectively be decided. The prayer for compelling the State Government to refer this dispute for adjudication cannot also be
granted in the absence of all the interested sugar factories.
5. Learned counsel for the petitioners then urged that a mandamus should issue to the State Government to refer the dispute between the petitioners and the sugar mills which are respondent No. 2 for adjudication. The petitions do not contain sufficient material on this point. There is no averment that any dispute really arose between the petitioners and the respondent sugar mills, whether the petitioners made any demand for payment of any particular sum as bonus from the respondent sugar mills and that the same was refused. There is no averment whether any conciliation proceedings were taken which are essential preliminaries to the making of the reference for adjudication. There is again no averment in the petitions or their supporting affidavits whether the petitioners asked the State Government to refer the industrial dispute with the respondent sugar mills for adjudication. The learned counsel sought permission to file a supplementary rejoinder affidavit giving certain facts relevant for this point. He wanted a further opportunity to amend the pet
