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Corporation of City of Nagpur Vs. N.H. Mujumdar and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtMumbai High Court
Decided On
Case NumberSpecial Civil Appln. No. 211 of 1957
Judge
Reported inAIR1958Bom231; (1958)60BOMLR180; ILR1958Bom493
ActsCentral Provinces and Berar Industrial Disputes Settlement Act, 1947 - Sections 2(10), 2(11), 2(12), 2(13), 2(14) and 39; Industrial Disputes Act, 1947 - Sections 2, 10 and 39; Constitution of India - Article 226; City of Nagpur Corporation Act, 1948 - Sections 59(2)
AppellantCorporation of City of Nagpur
RespondentN.H. Mujumdar and ors.
Appellant AdvocateM.N. Phadke, Adv.
Respondent AdvocateS.W. Dhabe, Adv. and ;N.L. Abhyankar, Addl. Govt. Pleader
Excerpt:
central provinces and berar industrial disputes settlement act (xxiii of 1948), sections 39, 2(14) - city of nagpur corporation act (ii of 1950), section 59(2)--whether industrial court when matter referred to it for arbitration has power to ascertain whether in fact any dispute existed between employer and employees--satisfaction of government contemplated by section 39 whether can be examined by court--activities of local authority whether industrial activities or not how to be decided--'employees' whether include persons superannuated or have ceased to serve for any reason other than dismissal, discharge or removal--applicability of act to employee engaged in manual or clerical work in industry.;section 39 of the central provinces and berar industrial disputes settlement act, 1947,.....mudholkar, j.1. this is a petition under article 226 of the constitution for the issue of a writ of certiorari for quashing the award made by the state industrial court at nagpur on 3rd june 1957, and for issue of such orders and directions to to the respondents 2 and 3 prohibiting them from taking steps for implementing that award.2. the relevant facts are these : the petitioner is the corporation of the city of nagpur. the government of the former state of madhya pradesh by a notification published on 23rd october 1956 referred twenty-one demands of the employees of the corporation for arbitration to the state industrial court under section 39 of the central provinces and berar industrial disputes settlement act, 1947. a preliminary objection as to the jurisdiction of the state.....
Judgment:

Mudholkar, J.

1. This is a petition under Article 226 of the Constitution for the issue of a writ of certiorari for quashing the award made by the State Industrial Court at Nagpur on 3rd June 1957, and for issue of such orders and directions to to the respondents 2 and 3 prohibiting them from taking steps for implementing that award.

2. The relevant facts are these : The petitioner is the Corporation of the City of Nagpur. The Government of the former State of Madhya Pradesh by a notification published on 23rd October 1956 referred twenty-one demands of the employees of the Corporation for arbitration to the State Industrial Court under Section 39 of the Central Provinces and Berar Industrial Disputes Settlement Act, 1947. A preliminary objection as to the jurisdiction of the State Industrial Court to entertain the reference was raised by the Corporation. The State Industrial Court ruled that this objection would be decided after recording evidence. A further objection was raised by the Corporation thereafter that the evidence should be taken only with reference to the question of jurisdiction and that the evidence on other matters should be taken only after the State Industrial Court came to the conclusion that it had jurisdiction to adjudicate upon the reference. This objection was also overruled by the State Industrial Court. It then proceeded to record such evidence as was tendered by the parties and eventually made the award which is challenged before us. The State Industrial Court directed the Corporation to implement the award within two months of the publication of the award by the State Government. After the petition was admitted by us, the Corporation made an application for staying the implementation of the award. Upon that application we made the following order after hearing the respondent No. 2, the Labour Officer, Nagpur, who represents the employees of the Corporation :

'Stay granted subject to the condition that the Corporation shall implement their resolutions approving the recommendation of the Pay Committee within a week and complete the payment within fifteen days.'

3. The first point which was urged before us by Shri Phadke, who appears for the Corporation, is that there is nothing to show that the Government had before it any material from which it could be inferred that there was any dispute at all between the Corporation on the one hand and its employees on the other. It was said that Section 39 of the Act requires that there must, in the first place, be a dispute, and, in the second place, there must be the satisfaction of the Government that any of the serious consequences contemplated by Section 39 would ensue unless that dispute is referred to an arbitration. Section 39 of the Act reads thus:

'Notwithstanding anything hereinbefore contained the Provincial Government may, at any time, refer any industrial dispute to the arbitration of the Provincial Industrial Court, if it is satisfied that

(i) serious disorder or a breach of the public peace is likely to be caused; or

(ii) serious or prolonged hardship to a large section of the community is likely to be caused, or

(iii) the industry concerned is likely to be seriously affected and employment curtailed by reason of the continuance of the dispute.' It will be seen that this section contemplates existence of an industrial dispute.

4. On behalf of the respondents 3 and 4 it is argued that when a matter has been referred by the Government to an arbitration all that the Industrial Court is entitled to do is to ascertain whether what has been referred by the Government is an industrial dispute or not and that it has no power to ascertain whether in fact any dispute existed between the employer and the employees. In this connection reliance was placed by Shri Abhyankar, who appears for the respondent No. 3, on a decision of the Supreme Court reported in Newspapers Ltd. v. State Industrial Tribunal U. P., (S) : (1957)IILLJ1SC . In that case Kapur J., who delivered the judgment of the Court observed :

'In spite of the fact that the making of a reference by the Government under the Industrial Disputes Act is the exercise of its administrative powers, that is not destructive of the rights of an aggrieved party to show that what was referred was not an 'industrial dispute' at all and therefore the jurisdiction of the Industrial Tribunal to make the award can be questioned, even though the factual existence of a dispute may not be subject to a party's challenge.'

Reliance was placed by his Lordship on the decision in State of Madras v. C.P. Sarathy, : (1953)ILLJ174SC , in support of his observations.

5. In the first place, these observations cannot be construed to mean that in no case can the factual existence of a dispute be subjected to a party's challenge; for, the word used by his Lordship is 'may' and not 'can' as would have been the case had his Lordship been of the view that in no case could the fact whether a dispute does or does not exist be examined. Indeed, no such view has been expressed in the decision relied upon by his Lordship. In that case what Patanjali Sastri, Chief Justice who delivered the judgment or the Court observed at p. 347 (of SCR); (p. 57) of AIR) was

'The Government must, of course, have sufficient knowledge of the nature of the dispute to be satisfied that it is an industrial dispute within the meaning of the Act, as, for instance, that it relates to retrenchment or reinstatement. This, in our opinion, implies that as a condition for coming to the conclusion that there is an industrial dispute, the Government must, in the first place, have sufficient knowledge that there is a dispute of some nature between the employer and the employees. For, without such knowledge there will be no occasion for ascertaining whether there was an industrial dispute at all, or in other words, whether the dispute alleged between the parties was or was not an industrial dispute. However, we need not detain ourselves further on this point because it would appear from the documents placed before us that the Government had before it material on the basis of which it could come to the conclusion that there was a dispute between the Corporation and its employees.

6. In the first place, there is Annexure S, which is a copy of the representation made to the then Labour Minister, Madhya Pradesh by Vasant Luley in his capacity as President of the Nagpur Corporation Employees' Association, This representation was submitted to the Minister on 6th October 1956. In that representation it is stated that the Association had submitted to the Corporation a memorandum of demands on 21-2-1954, that the representatives of the Association had a discussion with the then Mayor and the Chief Executive Officer, that eventually a Pay and reorganisation Sub-Committee was constituted on 19-12-1954, that this Sub-Committee submitted part of its report to the Corporation on 31-3-1955 and that though this report was placed on the agenda of the meeting of the Corporation for consideration held immediately afterwards, its consideration was postponed from time to time for several months. It also stated that 15th July 1955 was observed as a 'demands day' and that thereafter the report was taken up for consideration by the Corporation and accepted. 'A complaint was made that even though the report had been accepted, it had not been fully implemented by the authorities as yet. The representation then proceeded to state that the Association thereafter requested the Corporation for taking up the remaining demands, that is presumably the demands which were not dealt with in the report submitted by the Sub-Committee on 31-3-1955. After stating that the second part of the report was submitted by the Sub-Committee sometime in March 1956, a further complaint was made in the representation to the effect that the consideration of the demands had been postponed by the Corporation from time to lime. After reiterating faith in the methods of negotiation, conciliation and arbitration, it was stated that the Association regarded Strike as a last weapon. In the concluding portion of the representation it is stated:

'But most respectfully we would like to tell you that the employees of the Corporation are not wooden frames (sic) and they are prepared to fight for their demands and against injustice to the last. But before such a step was to be taken, we thought it desirable to come to you and place our demands. There is very much discontent (sic) amongst the employees and a situation is highly explosive. We, therefore, request you to refer our dispute to the Provincial Industrial Court under Section 39 of the M.P. Industrial Disputes Settlement Act, 1947 and avoid inconvenience and hardship that would cause to the public if the employees are forced to resort to strike.'

It is true that all the demands referred to the State Industrial Court are not specified in this representation. However, from the documents before us and also from the statements in the returns it is clear that after the representation was made by the Association to the Minister for Labour, he referred them to the Labour Commissioner and asked them to place all their demands before him. This was done as would appear from memo No. 737/x(b)/L. C., dated 10th October 1956, sent by the Labour Commissioner, Madhya Pradesh to the Secretary to Government Madhya Pradesh, Labour Department. Along with this memo the Labour Commissioner forwarded a list of demands which the Association had presented to the Corporation authorities from time to time. The Labour Commissioner also expressed the opinion that conditions existed to justify reference of the dispute to the State Industrial Court, under Section 39 of the Act. It is true that the original documents are not before us but the official file of the Labour Commissioner, which has been placed before us, contains an office copy of the memo of the Labour Commissioner quoted above and a list of all the demands put forward by the employees. Besides these documents, we find drafts of the notifications which was actually published and of the annexure thereto which contains the twenty-one demands actually referred to arbitration by the Government. From all these documents it is clear that the Government had material before it for showing that a dispute did exist between the Corporation on the one hand and its employees on the other.

7. It was also argued before us that there was no relevant material before the Government for being satisfied that serious or prolonged hardship to a large section of the community was likely to be caused if the dispute was not referred to arbitration. The satisfaction of the Government in this matter is necessarily to be subjective and is not a matter which can be examined by the Court. At any rate where, as here, the Government has stated in its notification that it is satisfied that serious and prolonged hardships to a large section of the community is likely to be caused if the dispute is not referred to arbitration and, where, as here, it is clear that the Government had some material before it to come to that conclusion, we have no power to go behind its satisfaction.

8. It was next urged that the dispute in question is not an industrial dispute at all inasmuch as none of the activities of the Corporation of the City of Nagpur can in any sense be termed as an 'industry', and that therefore the provisions of the Central Provinces and Berar Industrial Disputes Settlement Act, 1947, did not apply. It was urged that as Sub-section (2) of Section 59 of the City of Nagpur Corporation Act, 1948, shows that this Act generally vests the municipal government of the city in the Corporation, the activities of the Corporation such as supplying amenities to the citizens of Nagpur and ensuring sanitation and so on are only in the nature of governmental activities and as such cannot be made the subject of arbitration under the Industrial Disputes Settlement Act. That an activity whether of the government or of a local authority carried on by it by virtue of its sovereign power or by virtue of a delegated power cannot be disputed, for quite a number of industrial activities as commonly so understood, are in fact being carried on by the Government as also by the local bodies in these days. The Act itself recognises that where such is the case its provisions would apply to those activities. This is clear from the definition of 'employer' contained in Section 2 (11) of the Act. The term 'employer' includes

'(a) .... .... .... .... ....

(b) ..... .... .... .... ...;

(c) where an industry is conducted or carried on by a department of the State Government the authority prescribed in that behalf, and where no such authority has been prescribed, the head of such department;

(d) where an industry is conducted or carried on by or on behalf of a local authority, the Chief Executive Officer of such authority.' What is therefore to be determined in this case is which of the activities held by the Corpo-ration fall within the definition or 'industry' as contained in the Act.

9. Now, 'industry' is defined in Section 2 (14) of the Act. According to this definition, 'industry' includes, (a) any business trade, manufacturing or mining undertaking or calling of employers and (b) any calling, service, employment, handicraft or industrial occupation or avocation of employers. It is common ground that the activities of the Corporation of the City of Nagpur are classified under the following heads :

'1. Central Administration Department.

2. Octroi.

3. Tax.

4. Public Conveyance.

5. Fire Brigade.

6. Lighting.

7. Water Works.

8. City Engineer.

9. Enforcement.

10. Sewage Pumping Station.

11. Sewage Farm.

12. Health.

13. Market.

14. Cattle Pound.

15. Public Gardens.

16. Public Works.

17. Assessment.

18. Estate.

19. Education

20. Printing Press.

21. Workshop.

22. Building.'

It was, therefore, incumbent on the State Industrial Court to examine each of these activities and ascertain which, if any of these, would fall within the definition of 'industry' contained in the Act. The State Industrial Court, however, relying on the decisions in D.N. Banerji v. P.R. Mukherjee, : [1953]4SCR302 ; Baroda Borough Municipality v. Its Workmen, : (1957)ILLJ8SC and Hospital Mazdoor Sabha v. State ILR 1956 Bom 852, came to the conclusion that every activity of the Corporation is an 'industry'.

10. In the first-mentioned case, their Lordships were called upon to construe the meaning of the words 'industry' and 'industrial dispute' contained in Section 2(j) and (k) of the Industrial Disputes Act, 1947, which is a Central Act. At p. 317 (of SCR): (p. 63 of AIR), Chandrasekhara Aiyar J. who delivered the judgment of the Court observed :

'Having regard to the definitions found in our Act, the aim or objective that the Legislature had in view and the nature, variety and range of disputes that occur between employers and employees, we are forced to the conclusion that the definitions in our Act include also disputes that might arise between municipalities and their employees in branches of work that can be said to be analogous to the carrying out of a trade or business'.' (underlining (here into ' ') by us).

The words which we have underlined would clearly show that in the opinion of their Lordships each and every branch of work or activity of a local body cannot be regarded as a trade or business. No doubt, the judgment does contain, rather a long quotation from the speech of Lord Wright in National Association of Local Government Officers v. Bolton Corporation 1943 AC 166 , in which, among other things, it is stated :

'Indeed, 'trade' is not only in the etymological or dictionary sense, but in the legal usage a term of the widest scope.' And also,

'... but I take them as illustrating what modern conditions involve the idea that the functions of local authorities may come under the expression 'trade' or industry.'

But it does not follow from tin's that their Lordships regarded every activity or a trade of a local authority as an 'industry'. Indeed, as we understand the opinion of Lord Wright, every function of a local authority does not come under the expression 'trade' or 'industry' though some or many of its function may fall within that definition.

11. In the next case, Section K. Das J. who delivered the judgment of the Court has observed at p. 38 (of SCR): (p. 113 of AIR), of the report:

'It is now finally settled by the decision of this Court in D.N. Banerji v. P.R. Mukherjee (C) (supra), that a municipal undertaking of the nature we have under consideration here is an 'industry' within the meaning of the definition of that word in Section 2(j) of the Industrial Disputes Act, 1947, and that the expression 'industrial dispute' in that Act includes disputes between municipalities and their employees 'in branches of work that can be regarded as analogous to the carrying on of a trade or business'', (underlining (here into ' ') by us) Clearly, the portion which we have underlined governs both a 'municipal undertaking and the expression 'industrial dispute'. This decision, therefore, instead of lending support to the conclusion of the State Industrial Court negatives it. The Court, however, has quoted the following from that decision in support of its conclusion :

'Considering the question with reference to the facts of the present case it is clear to us that the different activities of the Baroda Municipality constituted one integrated whole and the activities of the different departments of the municipality were not distinct or unconnected activities so as to permit the isolation of one department from another or of an earning department from spending department.' (p. 50 (of SCR): (p. 120 of AIR)).

It has to be borne in mind that these observations were made with respect to the argument advanced before their Lordships to the effect that the profits earned by the municipality from their electric supply concerned ought to be utilised only for the purpose of giving bonus to the employees in that concern. Their Lordships negatived the contention on the ground that there was a single budget of the municipality and that it would be unfair to make a distinction between the workers of the earning department and the workers of the spending department in the matter of payment of bonus because such a distinction would, instead of promoting peace and harmony among the employees of the municipality, create unrest and discontent. These observations must, therefore, be taken in their context and cannot be regarded as justifying the conclusion that where some of the activities of a local authority partake of the character of a trade or industry all the activities of that authority must be deemed to be of the same kind.

12. Then as regards the third case, reliance is placed by the State Industrial Court on the following observations : (p. 860)

'... the test we should lay down in order to determine whether a particular activity undertaken by Government is an 'industry' would be to consider whether if that activity had been undertaken by a private agency, would it have been an industry to which the Act applied. If the Act had applied to that activity, then in our opinion, it is entirely im-material whether that activity is undertaken by Government.'

In that case it was held that the running of an hospital is not in the strict sense an essential Government function and that therefore that activity of the Government is an 'industry' within the meaning of the definition of that word contained in the Industrial Disputes Act, 1947. The learned Chief Justice who delivered the judgment of the Court was, however, careful to observe:

'In the wider sense, undoubtedly in which we now understand Governmental duty and Governmental work, it may be considered to be a Governmental function. But in its strict sense, the Governmental function would be the maintenance of law and order, administration of justice, collection of tax and similar functions which must always be attributed to a Government and which can only be discharged by a Government.'

Now, these observations clearly militate against the conclusion drawn by the State Industrial Court.

13. Then again, the learned Chief Justice after quoting a passage from an Australian case observed at page 862:

'We accept that principle, and as we have already pointed out, the Act does not purport to regulate relations between all employers and all employees. It only purports to regulate relations of all employers and employees engaged in an industry as defined by the Act.' The State Industrial Court has not stated whether all the activities of the Corporation of the City of Nagpur answer the test set out by the learned Chief Justice. It may be that it was of the view that every activity carried on by the Corporation was such as could, if authorised, be also carried on by a private agency. It is clear from the aforesaid decision that some of the activities of the Corporation, as for instance, levying or collecting taxes, assessing house property, or carrying on any other governmental function are not activities of a kind which it is permissible for a private individual to engage in. It was therefore necessary for the State Industrial Court to examine carefully each of the activities carried on by the Corporation and to ascertain which of those activities answer the test set out by the learned Chief Justice.

14. It was suggested by Shri Phadke that the test laid down by this Court in the Hospital Mazdoor Sabha v. State (E), cannot be accepted as correct one in view of the fact that the Supreme Court had accepted a different test in Budge Budge Municipality Case, : [1953]4SCR302 . In that case their Lordships quoted the following observations by Isaacs and Rich JJ. in the Federated Municipal and Shire Council Employees' Union of Australia v. Melbourne Corporation 26 Com LR 508 :

'Industrial disputes occur when, in relation to operations in which capital and labour are contributed in co-operation for the satisfaction of human wants and desires, those engaged in co-operation dispute as to the basis to be observed, by the parties engaged, respecting either a share of the product or any other terms and conditions of their co-operation.' (p. 316 of SCR) :(p. 63 of AIR).

Though this quotation is to be found in that judgment, it does not appear that their Lordships were of the view that for an activity to be classed an industry it must necessarily be carried on by the co-operation of capital and labour for the satisfaction of human wants and desires. Nor, indeed, does it appear that the two learned Judges who made the observation. in the Australian case regarded them as laying down an infallible test for determining whether the activity is an industry or not. Indeed, one of the Judges Isaacs J. himself laid down in a later case the test which was accepted by this Court in the Hospital Mazdoor Sabha v. State (E). That Judge observed in Federated State School Teachers Association of Australia v. The State of Victoria 41 Com LR 569 :

'If it was a function that a private person could lawfully do and being so done was industrial, that was sufficient.'

Indeed, a perusal of the earlier Australian case would show that what had to be considered was whether for an activity to be regarded as an industry it has necessarily to be carried on for profit. The majority of the Judges held that it was necessary to show that an activity to be regarded as an industry was carried on by the co-operation of capital and labour for the satisfaction of human wants and desires. On the basis of that decision and some other decisions a theory was advanced in the second mentioned Australian case to the effect that society is industrially organized for the production and distribution of wealth in the sense of tangible, ponderable corpuscular wealth and therefore, an industrial dispute cannot possibly occur except where there is furnished to the public -- the consumers -- by the combined efforts of employers and employed, wealth of that nature. Consequently it was contended on behalf of the employers that education not being wealth in that sense, there can never be an industrial dispute between the employers and the employees engaged in the avocation of education, regardless of the wealth derived by the employers from the joint co-operation. This argument was accepted by the majority. Isaacs J. who dissented from them set out the test which we have already indicated and which has been accepted by this Court. There is no reference to this decision in any of the Supreme Court cases. That apart, we do not see in what way the test accepted by this Court would be inconsistent with what has been held by their Lordships in : [1953]4SCR302 . Apart from the fact that the decision of the Division Bench is binding on us in this matter we would say with respect that we entirely agree with the test laid down by the learned Chief Justice. The State Industrial Court had therefore to examine the activities of the Corporation in the light of the test laid down in the case of Hospital Mazoor Sabha v. State (E).

15. The State Industrial Court after quoting an extract from the judgment of Powers J. in the first Australian case, observed thus in paragraph 9 of its award:

'These observations and the fact that their Lordships refused to interfere with the decision of the Industrial Court directing reinstatement of a Sanitary Inspector who obviously must have been an employee in the Health Department, and of the Head Clerk who must have been an employee of the General Administration Department of the Municipality clearly lead to the conclusion that none of the departments are such as can be excluded from the definition of the term 'industry'. It is obvious, their Lordships did not consider the Health Department to be one which could be excluded from the term 'Industry'. It might be suggested that what could be said of the Public Health, Water Works, Education or other departments could not be said of the General Administration Department which was purely concerned with administrative problems and no others. But we have it from the evidence on record that the G. A. D. coordinates the work of all the departments and cannot be separated from the other departments, It is inseparably connected with obviously commercial departments such as Octroi, Taxes, Assessment, Public Conveyance and Lighting. In my opinion, therefore, all the departments of the Corporation are such as are covered by the definition of the term 'industry' and all the employees working in all the departments are entitled to the benefit of the Industrial Disputes Settlement Act.'

It has to be borne in mind that no argument appears to have been advanced before their Lordships whether the particular activity in which the Head Clerk was engaged was an industrial activity or not & whether the Sanitary Inspector was a workman as defined in the Central Act. Therefore, the question whether any particular activities are industrial activities or not can only be decided after bearing in mind the definition of the term 'industry' contained in Section 2(14) of the Act and examining the activities of these as well as of other departments in the light of that definition as well as of the test laid down in the Hospital Mazdoor Sabha Case (E). Again, whether a particular employee is engaged in manual or clerical work in an industry must necessarily be determined before he can be held entitled to any relief. We cannot accept the view of the State Industrial Court that the General Administration Department cannot be separated from other departments because it carries on the work of all the departments. Even in regard to this department, the tests laid down in the Hospital Mazdoor Sabha case (E) were to be applied.

16. We are unable to understand what the State Industrial Court means by saying that the departments, such as, Octroi, Taxes, Assessment, Public Conveyance and Lighting, are commercial departments. From the mere fact that revenue is earned by the Corporation from Octroi, Taxes, Assessment, and Public Conveyance, we fail to see how they can be regarded as commercial undertakings. We may add that assessment and levying of taxes are governmental functions delegated to the Corporation and cannot prima facie be regarded as industrial undertakings. We do not quite understand how the Lighting Department is a commercial department because it has not been made clear to us what is done in this, department. As already stated, all the activities of the Corporation cannot be regarded as industrial activities and it was necessary to examine each activity separately and to ascertain whether it falls within the definition of 'industry' as contained in the Act.

17. We have not thought it necessary to discuss the argument of Shri Phadke based on the difference in the definition of 'industry' contained in the local Act and that contained in the Central Act because, in our opinion, if there is any difference, it does not affect the conclusion that all the activities of the Corporation are not excluded from the operation of the local Act by reason of the fact that they are undertakings carried on by local authorities and even though they are not what are understood in ordinary parlance as industrial activities carried on as a means of livehood or profit. No doubt, as distinct from the provisions of the Employment and National Arbitration Order, 1940, the ambit of which fell for consideration in 1943 A. C. 166 , the local Act does not say that 'trade' or 'industry' includes employees of a public or local authority. Still, as pointed out, already, it is clear from the definition of 'employer' as contained in this Act that the intention of the Legislature was to make it applicable to an industry conducted or carried on by or on behalf of a local body.

18. It was next argued by Shri Phadke that the award went beyond the scope of the reference. In this connection, he pointed out that the demand of the employees was only for the revision of their pay-scales according to the recommendation of the Pay Committee, whereas the State Industrial Court has undertaken the revision of those scales on its own, which is not generally in consonance with the recommendations of the Committee. We have not examined in detail whether this is so or not. But assuming that it has done what is alleged by the Corporation to have been done, we do not think that its action is in excess of the reference. No doubt demand No. 5 is couched in the following term :

'The Corporation should immediately revise the pay-scales according to the recommendations of the Pay Committee appointed by them.' But then demand No. 14 is couched thus :

'The pay-scales shown in the establishment lists for different posts are not proper. The same should be reconsidered and refixed in consideration to the responsibility attached to the various posts.'

It was open to the State Industrial Court to reject demand No. 5 and to grant demand No. 14 if, in its judgment, it was proper to do so. In demand No. 14 an objection was taken to the existing pay-scales in the establishment lists and a reconsideration and refixation of pay scales in the light of the responsibility attached to each post was sought. This demand is wide enough to cover the revision of pay scales. There is therefore no substance in the objection raised in this behalf.

19. Lastly it was contended that the State Industrial Court had no power to direct in its award that gratuity be paid to the persons who retired subsequent to 24-10-54 but prior to the date of reference. In our opinion, this contention is sound. The reference deals with 'employees' who must necessarily be existing employees or employees 'dismissed, discharged or removed on account of any industrial dispute.' It does not include persons who have ceased to be employees having been superannuated or having ceased to serve the Corporation for any reason other than dismissal, discharge or removal.

20. It is also open to doubt whether the question of granting gratuity other than on discharge would fall within the definition of 'industrial matter' as contained in Section 2(13) of the Act. It is not specifically mentioned in that clause that gratuity falls within any of the expressions 'work, pay, wages, reward.. . .privileges, rights' occurring in the clause. After all, the payment of gratuity is entirely in the discretion of the employer and cannot be regarded as a term of the service unless it is expressly so made either by a contract or by a statute. However, we would not say anything further in this matter, as the first ground given by us is adequate to dispose of the matter.

21. The question then is as to what order we should pass. The State Industrial Court, in the operative portion of its order, has set out 172 types of employees and dealt with their scales of salaries. The activities in connection with which these categories of persons are employed, are not clear from the schedule. We are therefore not in a position to say as to whether the award should be upheld in respect of all or only some of these categories. We would therefore direct the Industrial Court to re-examine the schedule in the light of our observations and limit it to persons who can be said to be engaged in an industry. There is another thing also which the State Industrial Court must bear in mind and that is whether the employees fulfil another requirement of the Act, that is, whether they perform clerical or manual work as distinguished from supervisory work, or work involving use of initiative or performance of statutory duties. Its jurisdiction to make an award is limited only to employees doing manual or clerical work even in an industrial undertaking.

22. Reliefs other than those relating to pay-scales will also have to be restricted to these classes of employees.

23. We therefore allow the petition partially quash the award and the schedule thereto as well as the direction to pay gratuity to persons who had retired prior to the date of reference and direct the State Industrial Court to make a fresh award and prepare a fresh schedule in the light of our observations. Bearing in mind the plight of the Corporation employees, particularly those in the lower grades of service, the rising spiral of prices and the inordinate delay that has already taken place in granting their just demands, we expect the State Industrial Court to deal with the matter with expedition.

24. The costs of this petition will be borne as incurred.

25. Petition allowed partially.


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