Judgement

RAMASWAMI, J. : This appeal is brought, by special leave, against the judgment of the Bombay High Court dated February 6, 1962 in Appeal No. 36 of 1960 from the order of K. K. Desai, J. in Miscellaneous Application No. 327 of 1959 filed by the appellant under Art. 226 of the Constitution of India.

2. The appellant carried on business as a cotton textile mill prior to July 1, 1958. It had been registered as an Undertaking in the cotton textile industry under the Bombay Industrial Relations Act, 1946 (Bombay Act XI of 1947), hereinafter referred to as the Act . The second respondents are a representative Union of the Cotton Textile Industry in the city of Bombay and registered as such under the provisions of the Act. The second respondents gave a notice of change in connection with the method to be adopted for grant of bonus for the years 1953 to 1957. The dispute arising out of that notice was referred to arbitration of the Industrial Court by a submission in writing dated February 28, 1956 under S. 66 of the Act. On March 1, 1956 an agreement was entered into between the Millowners Association on behalf of certain cotton textile mills and the second respondents in connection with the method to be adopted for payment of bonus for these years. In accordance with that agreement the Industrial Court made an award dated March 13, 1956 in terms of the said agreement. Clause 10 of the agreement provided for decision by arbitration in future in the event of difference of opinion arising between the parties regarding the determination of available surplus of profits or the quantum of bonus to be paid by the Cotton Textile Mills.

3. The appellant was not a party to the agreement and was accordingly not bound by the agreement. The Government of Bombay, however, issued a notification under S. 114(2) of the Act which states as follows:

"In cases in which a Representative Union is a party to a registered agreement, or a settlement, submission or award, the State Government may, after giving the parties affected an opportunity of being heard, by notification in the Official Gazette, direct that such agreement, settlement, submission or award shall be binding upon such other employers and employees in such industry or occupation in that local area as may be specified in the notification:

Provided that before giving a direction under this section the State Government may, in such cases as it deems fit, make a reference to the Industrial Court for its opinion."

The notification of the Government is dated July 31, 1956 and reads as follows:

"No. ARP-1256: Whereas the Rashtriya Mill Mazdoor Sangh, Bombay, a Representative Union for the Cotton Textile Industry in the local area of Greater Bombay (hereinafter referred to as the Union ) is a party to an award dated the 13th March 1956 made by the Industrial Court in reference (IC) NO. 114 of 1953, (IC) No. 24 of 1954, (IC) No. 25 of 1954 and submission (IC) No. 3 of 1956 providing for the payment of bonus for the years 1952 and 1953 and the years 1954 to 1957 both inclusive to the employees of the cotton textile mills in Greater Bombay (hereinafter referred to as the Award ).

And whereas the Government of Bombay, considers that the Award should be made binding upon the employers specified in column of the schedule hereto annexed and their employees in the said Cotton Textile Industry in Greater Bombay;

And whereas the said employers and the Rashtriya Mill Mazdoor Sangh, Bombay representing the said employees being the parties affected were heard as required by Sub-section (2) of Section 114 of the Bombay Industrial Relations Act, 1946 (Bombay XI of 1947) (hereinafter referred to as the said Act );

Now therefore, in exercise of the powers conferred by sub-section (2) of Section 114 of the said Act, the Government of Bombay hereby directs that the said Award shall be binding on the employers specified in column 1 of the Schedule hereto annexed and their employees in the matter of payment of bon