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Gulamahamed Tarasaheb Vs. State of Bombay - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtMumbai High Court
Decided On
Case NumberSpecial Civil Application No. 1423 of 1959
Judge
Reported in[1961(3)FLR122]; (1961)ILLJ702Bom
ActsMinimum Wages Act, 1948 - Sections 3, 5, 5(1), 5(2), 7, 9, 12, 22 and 25
AppellantGulamahamed Tarasaheb
RespondentState of Bombay
Excerpt:
labour and industrial - fixation of wages - sections 3, 5, 7, 9, 12 and 25 of minimum wages act, 1948 - notification issued fixing minimum wage of bidi workers - petition filed contending that fixation of wages not done according to prescribed rule and regulation - government empowered to fix wages - wages fixed after careful consideration - procedural irregularities could not vitiate fixation of minimum wages - held, fixation of wages reasonably fixed. - - it seems that sri dhutia, after making an inquiry, submitted his report to the labour and social welfare department of the state of bombay, which issued a notification on 10 september, 1958 publishing the government's proposals for revising minimum rates of wages of bidi-workers fixed by the state of hyderabad in march 1955. the.....gokhale, j.1. this special civil application under art. 226 of the constitution has been filed by four bidi-manufacturing factories in marathwada under these circumstances : in 1955, after the minimum wages act, 1948 (which shall hereafter be referred to as 'the act'), was made applicable to bidi factories in hyderabad, the government of the state of hyderabad issued a notification fixing the minimum rates of wages for bidi-workers. this notification dated 4 march, 1955 came into force on 30 march, 1955 in four areas of the hyderabad state. on 1 november, 1956 five districts of marathwada merged with the bombay state and on 18 november, 1957 the deputy commissioner of labour informed all the employers of the tobacco manufactories in the areas of marathwada that the government of bombay.....
Judgment:

Gokhale, J.

1. This special civil application under Art. 226 of the Constitution has been filed by four bidi-manufacturing factories in Marathwada under these circumstances : In 1955, after the Minimum Wages Act, 1948 (which shall hereafter be referred to as 'the Act'), was made applicable to bidi factories in Hyderabad, the Government of the State of Hyderabad issued a notification fixing the minimum rates of wages for bidi-workers. This notification dated 4 March, 1955 came into force on 30 March, 1955 in four areas of the Hyderabad State. On 1 November, 1956 five districts of Marathwada merged with the Bombay State and on 18 November, 1957 the Deputy Commissioner of Labour informed all the employers of the tobacco manufactories in the areas of Marathwada that the Government of Bombay was considering the revision of minimum rates of wages fixed under the Act and that Sri Dhutia, Assistant Commissioner of Labour (Administration), Bombay, would conduct an inquiry in respect of the existing conditions of services obtaining in the industry including its financial capacity. It seems that Sri Dhutia, after making an inquiry, submitted his report to the labour and Social Welfare Department of the State of Bombay, which issued a notification on 10 September, 1958 publishing the Government's proposals for revising minimum rates of wages of bidi-workers fixed by the State of Hyderabad in March 1955. The Marathwada Bidi Manufacturers' Association, being dissatisfied with the recommendations made by Sri Dhutia as well as the proposals contained in the draft notification, made representations to the Government of Bombay and it appears that a representation was also sent to the Advisory Board constituted under the provisions of the Act. These representations were sent on 15 November, 1958. It is not disputed that the Bidi Manufacturers' Association received an intimation from the Minimum Wage Advisory Board, Bombay, dated 15 January, 1959 stating that the Advisory Board had appointed a committee to consider the proposed revision of rates of wages in respect of employment in bidi-making factories in Marathwada and that the committee would be visiting Nanded on 19 January, 1959 and Aurangabad on 20 January, 1959 for the purpose of recording evidence of the employers, employees, their organizations, etc. The committee consisted of seven persons, but there is no dispute that only four of them, including Sri P. S. Bakhale, the Chairman of the Advisory Board, visited Aurangabad on 21 January, 1959. It would seem from the petition that, on behalf of the bidi-manufacturers of Marathwada, an objection was raised to the constitution of the committee, and the representatives of the association thereafter do not appear to have co-operated with that committee. The final notification containing the revised rates was published on 8 July, 1959 and that was to come into force on or after 1 August, 1959. The draft notification issued by the Government on 10 September, 1958 had slightly increased the rates of minimum wages of bidi-workers over the minimum wages fixed by the State of Hyderabad in March 1955. The final notification issued by the Government of Bombay on 8 July, 1959, abolished the distinction between workers in factory and workers who made bidis at their own homes and who are known as Gharkhata workers, which prevailed under the notification issued by the Government of Hyderabad, and fixed a common minimum wage for both the kinds of workers. Secondly, the final notification also increased the rates of minimum wages beyond the revised rates proposed in the draft notification issued in September 1958. The petitioners-bidi-manufacturing factories, being aggrieved by the revised rates fixed in the final notification, have filed the present petition challenging the validity of the aforesaid final notification issued by the State of Bombay on several grounds.

2. Sri Pendse, learned advocate appearing on behalf of the petitioners, has raised the following contentions in support of the petition : In the first instance, he contended that the Government have not followed the procedure prescribed under S. 5 of the Act in issuing the final notification. It is urged that since the draft notification had already proposed an increase in the rates of minimum wages payable to bidi-workers, it is the representation of the manufacturers alone that could be considered by the Government; and if Government, after they took the advice of the Advisory Board, contemplated a further rise in the rates of minimum wages, they should have given another opportunity to the employers to make further representations against their fresh proposals. Sri Pendse then contends that under the Act is the function of the Advisory Board to tender its advice to the Government; but in the present case the Advisory Board appears to have appointed a small sub-committee for the purpose of making inquires on the spot and thereby it had delegated its function to this committee, and that, according to him, is not contemplated by the Act. It is also urged that assuming that the Advisory Board could collect information and data by appointing a sub-committee, that sub-committee should also have been constituted on the principles laid down under S. 9 of the Act and that, having been done, the advice which was tendered by the Advisory Board on the report of the sub-committee would be vitiated and, therefore, the final notification would be invalid. The last contention of Sri Pendse is that the final notification issued by the Government is void because it has raised the rates of minimum wages to such an extent that it would be impossible for the petitioners to carry on their bidi-manufacturing business and, therefore, that would be in contravention of their fundamental right under Art. 19(1)(g) of the Constitution. It is also contend that under S. 12 of the Act it is obligatory on the employer to pay the minimum rate of wages fixed under the Act; and if that is not paid, the employer would be exposed to penalties for offences under S. 22 of the Act. On the other hand, Sri Pendse contends, no such obligation is cast on the workers and he points out that in the present case the bidi-workers have informed the petitioners that they are willing to settle the wages by mutual negotiations in order to avoid the closure of the factories as threatened by the bidi-manufacturers. Sri Pendse argues that whereas the workers can show their willingness to work on lesser rates of wages than the minimum fixed and can actually receive less wages, they would not be exposed to the penalties which an employer would have to suffer under the provisions of S. 22 of the Act. On this ground, Sri Pendse contends that the relevant provisions of the Act must be struck down on the ground that they are discriminatory and violative of Art. 14 of the Constitution. The argument appears to be that in case the Court declares that Ss. 12 and 22 of the Act are made as they violate the provisions of Art. 14 of the Constitution, it would be open to the petitioners to arrive at an amicable settlement with the workers in the bidi factories, so that it would not be necessary for the employers to close down the bidi factories, and that would be beneficial both to the petitioners as well as the workers. These, in short, are the arguments addressed to us in support of the petition.

3. It has to be mentioned that in the affidavit filed on behalf of the State, an objection has been raised that the present petition has been filed after considerable delay. But the learned Advocate-General informed us that he would not be pressing that objection as the State was desirous of having a decision of this petition on merits.

4. In order to test the validity of the arguments advanced on behalf of the petitioners, it is necessary to refer to some of the relevant provisions of the Act. Under S. 3, the appropriate Government is empowered to fix the minimum rates of wages payable to employees employed in scheduled employments; and there is no dispute that bidi-making factories fall within the ambit of the Act. Section 5 lays down the procedure for fixing and revising minimum wages; and as Sri Pendse has contended that, in issuing the present final notification, Government have not followed the procedure laid down in this section, it necessary to quote it in full. Section 5 provides as follows :

'5. (1) In fixing minimum rates of wages in respect of any scheduled employment for the first time under this Act, or in revising minimum rates of wages so fixed, the appropriate Government shall either -

(a) appoint as many committees and sub-committee as it considers necessary to hold enquiries and advise it in respect of such fixation or revision, as the case may be, or

(b) by notification in the official gazette, publish its proposals for the information of persons likely to be affected thereby and specify a date, not less than two months from the date of the notification, on which the proposals will be taken into consideration.

(2) After considering the advice of the committee or committees appointed under Clause (a) of Sub-section (1), or as the case may be, all representations received by it before the date specified in the notification under Clause (b) of the sub-section, the appropriate Government shall, by the notification in the official gazette, fix, or, as the case may be, revise the minimum rates of wages in respect of each scheduled employment and unless such notification otherwise provides, it shall come into force on the expiry of three months from the date of its issue : Provided that where the appropriate Government proposes to revise the minimum rates of wages by the mode specified in Clause (b) of Sub-section (1), the appropriate Government shall consult the Advisory Board also.'

There is no dispute in the present case that the Government have not appointed any committee or sub-committee to advise them in respect of revision of the rates as contemplated under S. 5(1)(a) of the Act. The Government, in the first instance, followed the procedure as prescribed under S. 5(1)(b) by publishing their proposals under that section. Under S. 7, the Government have to appoint an Advisory Board for the purpose of co-ordinating the work of committees and sub-committees appointed under S. 5 and advising them generally in the matter of fixing and revising minimum rates of wages. Section 9 deals with the composition of committees and it provides that each of the committees, sub-committees, and the Advisory Board shall consist of persons to be nominated by the appropriate Government representing employers and employees in the scheduled employments, who shall be equal in number, and independent persons not exceeding one-third of its total number of members and one of such independent persons shall be appointed the chairman by the appropriate Government. There is no dispute in the present case that the Advisory Board constituted under the Act is properly constituted. Sri Pendse's grievance in connexion with the Advisory Board is that the Board delegated the function of making inquires on the spot to a committee of seven persons and that committee was not constituted on the principles laid down in S. 9.

5. As already stated, in the present case, the Government published their proposals by way of draft notification in September, 1958, under Clause (b) of Sub-section (1) of S. 5 of the Act. That notification contained proposals of Government for revising minimum rates of wages in respect of employment in any tobacco (including bidi-making) manufactory in the Hyderabad area of the State of Bombay. Paragraph 2 of the notification stated that any representations which may be received by the Secretary to the Government of Bombay, Labour and Social Welfare Department, from any person in respect of the said draft on or before 15 November, 1958 would be taken into consideration by Government. In the schedule to this draft notification, the revised rates were indicated and in respect of those revised rates the notification made a two-fold classification, viz., revised rate for persons employed in bidi-making on the premises of bidi-making manufactory and revised rate for persons employed in bidi-making outside the premises of the bidi-making manufactory (Gharkhata workers). This classification of workers followed the classification already existing in the notification issued by the Government of Hyderabad in March 1955. Under the Hyderabad notification, in Aurangabad, Jalna and Vaijapur areas the rates of minimum wages for workers in bidi factories were Rs. 1-8-0 and for Gharkhata workers they were Rs. 1-6-0 for every 1,000 bidis and in the rest of Hyderabad, the rates were 2 annas lower for both classes of workers. In the draft notification issued by the Government of Bombay in September 1958, for the Aurangabad district, the revised rate proposed for persons employed in bidi-making on the premises of the bidi-making manufactory was Rs. 1.62 per 1,000 bidis, while the revised rate for persons employed outside the premises (Gharkhata workers) was Rs. 1.50 per 1,000 bidis. So far as Nanded, Osmanabad, Bihar and Parbhani districts were concerned, the revised rate proposed for both classes of workers was Rs. 1.37 per 1,000 bidis. In the final notification issued in July 1959, the revised rate of wages fixed for workers in Aurangabad district was Rs. 1.75 and for the districts of Nanded, Osmanabad, Bhir and Parbhani, it was fixed at Rs. 1.50 per 1,000 bidis, the classification of bidi-workers into those making bidis on the factory premises and Gharkhata workers being done away with.

6. Sri Pendse, in the first instance, contends that since the draft notification revised the rates favourably for the bidi-workers by introducing a slight increase in the original rate, it would not be necessary and not even open to the workers to make any representations with regard to the draft notification and the Government would have to consider only the representation of the employers who were adversely affected by the said notification. It is the contention of the petitioners that is the effect of the procedure prescribed under S. 5(1)(b) of the Act. We are unable to accept this contention. Under S. 5(1)(b)MUM WAGES ACT, 1948~^, what the Government do is to publish their proposals for revision and the publication is for the information of persons likely to be affected thereby. It cannot be said, therefore, that the draft notification is published only for the information of persons who might be prejudicially affected and that it would not be open to the workers in whose favour the proposals have been made by the Government to make any representation with regard to the draft notification. It is impossible to accept the contention urged by Sri Pendse that what is contemplated under S. 5(1)(b)MUM WAGES ACT, 1948~^ is representation on the part of persons who are prejudicially affected by the proposals of Government, because it would make it necessary to add something to the wording of the section which is not there. In the second place, under S. 5(2)INIMUM WAGES ACT, 1948~^ of the Act, before Government fix the revised minimum rates of wages, they have to take into consideration all representations received by them, and that necessarily implies that representations might be received both from the employers as well as the employees. In the present case, it is not in dispute that before the draft notification was issued, the question of revision of minimum rates of wages was inquired into by Sri Dhutia, Assistant Commissioner of Labour (Administration), Bombay, and after his report was received the Government published the draft notification. Now, it may be that though in the present case the proposals of Government contemplated a rise in the rates of minimum wages, the bidi-manufacturing workers might not be satisfied with the rise proposed, and we fail to see how it could be said that they were persons not likely to be affected by the proposals of Government. We must, therefore, reject the argument of Sri Pendse that under S. 5(1)(b) of the Act, if proposals are published and if the proposals are favourable to the workers, it would be only open to the employers to make representations.

7. But then Sri Pendse argues that after the Government make their proposals and representations are received by them, they have also to consult the Advisory Board and the final notification would be issued after considering all representations and the opinion of the Advisory Board. Sri Pendse contends that the representations being grade on the basis of the draft notification and the opinion of the Advisory Board having been also received on the basis of the said notification, it would not be open to the Government further to increase the rates of minimum wages and go beyond their own proposals under the draft notification. We are unable to accept this argument either. As we have already stated, the draft notification is published for the information of person who are likely to be affected and contains the proposals of Government, and these proposals would be subject to further consideration in the light of representations received by the Government and the advice tendered by the Advisory Board. The employers would be naturally making a representation, as they have done in the present case, showing reasons why there should be no increase in the rates, and if the workers are dissatisfied with the increase proposed by Government, the workers might also make representations for the purpose of persuading Government to make a further rise in the rates of minimum wages. The Advisory Board also might either advise the Government to reduce the proposed rates or to increase them, or support their proposals on the basis of the data that the Advisory Board might have taken into consideration. In our view, there is nothing in S. 5 or any other provision of the Act which prevents Government from either reducing or increasing the rates of minimum wages which they might publish as their proposals under S. 5(1)(b) of the Act.

8. But then it is contended on behalf of the petitioners that assuming that Government have got the power to revise the rates to the further detriment of the employers, the employers must have a fresh opportunity to make representations showing cause why Government should not go beyond their published proposals. This argument also, in our opinion, is without any substance. The draft notification contains proposals of Government and they are liable to be further revised by reduction or increase in the proposed rates of minimum wages, and when representations are made either by the employers or the employees, those representations would be on the basis that the proposals are liable to be so altered. In their affidavit of reply to this petition, it has been stated on behalf of respondent 1, the State of Bombay, that before the final notification was issued they considered the objections against the proposed revision raised by the bidi-manufacturers as well as the employees and published the final notification. It is also stated in the affidavit that Government would rely on the representation received from the Marathwada Bidi Manufacturing Association. That representation has been produced before us by the learned Advocate-General and Sri Pendse has raised no objection to the State relying on that representation. In the final paragraph of that representation, the Bidi Manufacturing Associations have clearly stated that the wage-rates should not be increased because it would ruin the bidi industry in Marathwada and would effect the employment of nearly 2,000 workers. It is true that no details have been given as to the economic loss that the employers were likely to suffer as a result of the proposed increase. A statement showing profit and loss on the basis of the year 1957-58 has been annexed to this petition at Ex. D on behalf of applicant 1 factory; and it is the contention of Sri Pendse that that statement would show how the final rates would be ruinous to the bidi industry in the Marathwada area. The accuracy of this statement, which has been annexed to the petition, is not accepted, and it would be impossible for this Court to consider such a statement in a petition under Art. 226 of the Constitution. The details which are now furnished with the petition could have been furnished along with the representation, and it was also open to the employers to explain the financial implication of the Government's proposals to the committee which visited Aurangabad and about which visit intimation was given to the employers. But it appears from the petition itself that for one reason or the other employers thought it proper not to co-operate with that committee. It is difficult, however, to appreciate the argument that if a further notice had been given about Government's intention to raise the revised rates beyond what was contemplated under the draft notification, the employers would have been in a position to place more facts before Government. Section 5 of the Act does not contemplate publication of fresh proposals on the part of Government after the receipt of representations. The employers in the present case had clearly indicated in their representation that any further increase beyond the prevailing rates under the Hyderabad notification would seriously affect the industry. That was the point of view which the industry placed before Government in its representation. In our view, it was open to the Government to go beyond their draft proposals, after taking into consideration all the representations received and the opinion of the Advisory Board, which they have done in the present case. This argument, therefore, on behalf of the petitioners also must be rejected.

9. Then it is contended that a wrong procedure has been followed in the present case because the Advisory Board which is a statutory body appointed a committee to visit two places in Marathwada to gather data about the bidi industry. It appears that the Advisory Board appointed a committee of seven persons, and that committee visited Nanded and Aurangabad and an intimation of this visit was given to the employers. In fact, only four persons visited Aurangabad on 21 January, 1959 when a preliminary objection was said to have been taken by the employer that the committee was not properly constituted and ultimately the employers' representatives left the meeting, refusing to co-operate with the committee. The chairman of this committee Sri P. S. Bakhale is admittedly the chairman of the Advisory Board. Though it was not clear either from the petition or from the affidavit in reply, it is now an admitted position that the other three members of the committee, viz., Sri M. S. Mangilal Shival, Sri B. D. Pawar and Sri H. R. Kolte, who also visited Aurangabad, are all members of the Advisory Board. The contention on behalf of the petitioners is that the function of the Advisory Board has been delegated to a committee and this procedure is not warranted by any of the provisions of the Act. This argument, in our judgment, cannot be accepted. The function of the Advisory Board is to advise the Government as regards the revision of minimum rates of wages. There appear to be no rules in accordance with which the committee is expected to function. We have been informed that the committee consists of 23 persons and, as already stated, the composition of the Advisory Board itself has not been challenged. All the four members of the committee which visited Aurangabad are members of the Advisory Board. The object of their visit was to get information about the bidi-manufacturing industry. It was for the Advisory Board to determine the manner in which it would collect information for the purpose of its principal function of giving advice to Government in these matters. It was clearly the opinion of the Advisory Board that was taken into consideration by the Government and not the report, if any, made by this committee; and that is all that is required under the Act. We cannot, therefore, accept the argument of Sri Pandse that the final notification issued by the Government was invalid since it was based on the opinion of the Advisory Board which itself made no enquiry, but left it to a smaller committee. In our view, there is nothing in the Act which prevents the Advisory Board from devising its own procedure for collecting information and data for the purpose of fulfilling its function of tendering advice to the Government under S. 5 of the Act. We may mention that a similar point was raised in the case of a bidi and Tobacco Merchants' Association v. State : (1959)IILLJ286Bom in two special civil applications which were heard by Sri Mudholkar and Sri Kotval, JJ., and that was negatived by Justice Sri Mudholkar on the ground that the function of the Advisory Board under the Act was merely to advise and not to take a decision and it would be open to the Advisory Board to devise its own procedure for obtaining information necessary for the purpose of discharging its duty of tendering advice to the Government. Though there was a difference of opinion between Justice Sri Mudholkar and Justice Sri Kotval in that case, the observations of Justice Sri Mudholkar on this point are not affected.

10. But then Sri Pendse contends that assuming that the Advisory Board was right in appointing a committee for making an inquiry on the spot, it should have constituted a sub-committee, the composition of which was in conformity with the principles laid down in S. 9 of the Act. Under S. 9, the Advisory Board is to consist of persons to be nominated by Government representing the employers as well as the employees and they are to be equal in number, and the Government are to appoint independent persons not exceeding one-third of the total number of members, one of such independent persons being appointed the chairman. There is no dispute that the Advisory Board of which Sri P. S. Bakhale was the chairman had been properly constituted. He, along with three others, visited Aurangabad, though the Advisory Board had appointed a committee of seven persons to go to Marathwada area. All the four persons who visited Marathwada are members of the Advisory Board. But Sri Pendse contends that this four-man committee consisted of a representative from Sholapur who represented the bidi-factory owners of that place, whereas the other two representatives were labour representatives, one from Nasik and the other from Jalgaon, and Sri Pendse argues that the composition of this committee is vitiated because it contained only one representative of the factory owners as against two representatives of labour, whereas under S. 9 of the Act what is contemplated is equal representation for the employers and the employees. It is further contended on behalf of the petitioners that Sri M. S. Mangilal Shival represented Sholapur factory owners and, therefore, he could not have properly safeguarded the interests of the bidi-factory owners in Marathwada. This argument again, in our view, is misconceived. It is for the Advisory Board to devise its own procedure for the purpose of making inquiries or gathering data in order that it may be able properly and adequately to discharge its function of tendering advice to Government. All the members of the committee who visited Marathwada area were members of the Advisory Board. In our view, therefore, the opinion of the Advisory Board was in no manner vitiated by the fact that the committee constituted by the Board for the purpose of making a local inquiry was not in accordance with the principles of S. 9 of the Act. Even assuming that the procedure adopted by the Advisory Board in appointing a committee was not regular, we do not think that the ultimate advice which they tendered to Government on the question of revision of rates can be challenged, because the Act does not make it compulsory for Government to accept the recommendations of the Advisory Board. In this connexion, we may observe that a similar contention raised before the Supreme Court in Edward Mills Company, Ltd. v. State of Ajmer : (1954)IILLJ686SC was negatived on the ground that the committee appointed under S. 5 of the Act was only an advisory body and the Government were not bound to accept any of its recommendations, and consequently procedural irregularities could not vitiate the final report which fixed the minimum wages.

11. Then it is contended by Sri Pendse that the impugned notification has revised the rates to such an extent that it would spell ruin to the bidi industry in Marathwada as represented by the petitioners and would make it necessary for them to close their business and that would infringe the fundamental right of the petitioners guaranteed to them under Art. 19(1)(g) of the Constitution. In our view, this contention cannot be accepted in view of the decision of the Supreme Court in Bijay Cotton Mills, Ltd. v. State of Ajmer : (1955)ILLJ129SC where it was held that the restrictions imposed upon the freedom of contract by the fixation of minimum rates of wages, though they interfered to some extent with the freedom of trade or business guaranteed under Art. 19(1)(g) of the Constitution, are not unreasonable and as they are imposed in the interest of general public and with a view to carrying out one of the directive principles of State policy as embodies in Art. 43 of the Constitution, they are protected by Cl (6) of Art. 19. We might observe that all the arguments which have been addressed to us on this point by Sri Pendse were considered by their lordships and it was observed that if the labourers are to be secured in the enjoyment of minimum wages and are to be protected against exploitation by their employers, it was absolutely necessary that restraints should be imposed upon their freedom of contract and such restrictions cannot, in any sense, be said to be unreasonable. On the other hand, the employers cannot be heard to complain if they are compelled to pay minimum wages to their labourers even though the labourers, on account of their poverty and helplessness, are willing to work on lesser wages. The argument that exhorbitant rise in the rates of minimum wages might ultimately lead to closure of business was answered by the Supreme Court by observing that individual employers might find it difficult to carry on the business on the basis of the minimum wages fixed under the Act, but that must be due entirely to the economic conditions of the particular employers and that was no reason for striking down the law itself as unreasonable. In our view, the contention of Sri Pendse that the impugned notification is bad as contravening Art. 19(1)(g) of the Constitution must be rejected, in view of this decision of the Supreme Court.

12. Finally, it is contended by Sri Pendse that the notification which is issued by the Government on 8 July, 1959, would make it obligatory on the employers to pay higher rate of wages now fixed by reason of S. 12 of the Act; and in case the employers do not pay these wages they would be exposed to the penalties provided in S. 22 of the Act. The argument is that there is no such obligation imposed on the workers and if the workers accept wages less than the minimum rates of wages they would not be exposed to penalties under S. 22 of the Act, and, therefore, there is contravention of Art. 14 of the Constitution. Now, in the first instance, we do not think it necessary to deal with this question because it is admitted that at present the petitioners have continued to pay the minimum wages as fixed in the final notification. Secondly, it is not correct to say that the Act only make it obligatory on the employers to pay the minimum rates of wages as fixed by Government by virtue of S. 12, and no such obligation is imposed on the employees. Section 25 of the Act provides that any contract or agreement whether made before or after the commencement of the Act, whereby an employee either relinquishes or reduces his right to a minimum rate of wages or any privilege or concession accruing to him under the Act shall be null and void in so far as it purports to reduce the minimum rate of wage fixed under the Act. It is, therefore, quite clear that the Act also prohibits contracting out and acceptance of less than the minimum wages on the part of workers. It is no doubt true that whereas the breach of S. 12 of the Act would expose the employer to penalties under S. 22, there are no such penalties provided against the employees in case they work on wages less than the minimum rats of wages. But that, in our opinion, would not make Ss. 12 and 22 of the Act void on the ground of discrimination. It is well-settled that Art. 14 of the Constitution does not forbid reasonable classification. But in order to pass the test of permissible classification, two conditions have to be fulfilled, viz.,

(1) that the classification must be founded on an intelligible differential which distinguishes persons or things that are grouped together from others left out of the group;

(2) the differential must have a rational relation to the object sought to be achieved by the statute in question.

[See Express Newspaper, Ltd. v. Union of India : (1961)ILLJ339SC ]

The object of the Act is to provide for fixation of minimum rates of wages in certain employments in order that the workers may not be exploited. It is the employers who have to pay wages, and they are in a better position to resist the demands of the employees for higher rates of wages. It is the employees who have to be protected against accepting wages which are less than the minimum rates of wages. While the Act makes contracting out void by virtue of S. 25 in the interests of employees themselves, the legislature has provided for penalties in case of breach of S. 12 by employers only, because it is they who have to pay the minimum rates of wages fixed by Government. In our judgment, therefore, the classification that is made is based on an intelligible and a rational differential and is intended to fulfil the object of the legislation which is to protect the workers from being exploited by the employers. In our view, therefore, the argument that Ss. 12 and 22 of the Act would be void on the ground that they are violative of Art. 14 of the Constitution also cannot be accepted.

13. The result is that all the contentions raised on behalf of the petitioners fail and the rule will have to be discharged with costs.


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