Skip to content


State Farms Corporation of India Limited Vs. Rajendra Taneja - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtRajasthan High Court
Decided On
Case NumberS.B. Civil Writ Petition No. 1425/83
Judge
Reported in1983WLN(UC)314
AppellantState Farms Corporation of India Limited
RespondentRajendra Taneja
DispositionPetition dismissed
Cases ReferredVerma v. Industrial Tribunal
Excerpt:
.....farm corporation is neither directly i run by nor is a department of central government--held, state government was justified in making reference.;any dispute relating to the industrial finance corporation of india or state insurance corporation or india airlines or agricultural refineries corporation has been illustrated in section 2(a) of the act under clause (ii) in relation to any other industrial dispute, the state government is the competent authority.;the term 'appropriate government' is defined in section 2(a), is exhaustive in relation to any industrial dispute concerning the industrial undertaking or establishment enumerated in the clause, the central government is the appropriate government.;the central government is not carrying on directly the industry. the company is..........and satisfaction. the society is also to comply with all such directions as my be issued by the state government with approval of the central government in respect of any matters dealt with in the report of the reviewing committee the control of the state and the central governments is indeed so deep and pervasive that no immovable property of the society can be disposed of in any manner without the approval of both the governments. the state and the central government have even the power to appoint any other person or persons to be members of the society and any member of the society other than a member representing the state or the central government can be removed from the membership of the society by the state government with the approval of the central government. the board of.....
Judgment:

D.L. Mehta, J.

1. Petitioner has preferred this writ petition challenging the award dated May 1, 1982 passed by the Labour Judge, Bikaner, Petitioner has raised only two points before me during the course of argument; (i) that the State Government was not appropriate authority, as defined Under Section 2(e) read with Section 14 of the Industrial Disputes Act, 1947 to make the reference; and (ii) that the labour Court was not justified in granting the relief of re-instatement and 50% salary.

2. Learned Counsel for the petitioner has invited my attention to the case of Som Prakash v. Union of India . The relevant portion of Head Note 'A' leads as under:

The preponderant considerations for pronouncing an entity as State agency or instrumentality are (i) financial resources of the State being the chief funding source (ii) functional charter being governmental in essence, (iii) plenary control residing in Government, (iv) prior history of the same activity having been carried on by Government and made over to the new body and (v) some element of authority or command. Whether the legal person is a corporation created by a statute, as distinguished from under a statute, is not an important criterion although it may be an indicium.

Learned Counsel for the petitioner has further invited my attention to the case of Ajay Hasia v. Khalid Mujib AIR 198l SC 487. Head Note 'A' of which reads as under:

Where a Corporation is an instrumentality or agency of the government, it must be held to be an 'authority within the meaning of Article 12 and hence subject to the same basic obligation to obey the fundamental Rights as the government.

It is immaterial for determining whether a Corporation is an authority whether the Corporation is created by a statute or under a statute. The test is whether it is an instrumentality or agency of the Government and not as to how it is created. The inquiry has to be not as to how the juristic person is born but why it has been brought into existence. The Corporation may be a statutory corporation created by a statute or it may be a Government company or a company formed under the Companies Act or it may be a society registered under the Societies Registration Act or any other similar statute. Whatever be its genetical origin, it would be an 'authority' within the meaning of Article 12 if it is an instrumentality or agency of the Government and that would have to be decided on a proper assessment of the facts in the light of the relevant factors. The concept of instrumentality or agency of the Government is not limited to a corporation created by a statute but is equally applicable to a company or society and in a given case it would have to be decided, on a consideration of the relevant factors, whether the company or society is an instrumentality or agency of the Government so as to come within the meaning of the expression 'authority' in Article 12. A juristic entity which may be 'State' for the purpose of Parts III and IV would not be so for the purpose of PART XIV or any other provisions of the Constitution.

In the instant case the Regional Engineering Collage; Srinagar is one of the fifteen Engineering Colleges in the country sponsored by the Government of India. The College is established and its administration and management are carried on by a Society registered under the Jammu and Kashmir Registiation of Societies Act, 1898 Having regard to the Memorandum of Accociation and the Rules of the Society it was held that the society is an instrumentality of the agency of the State and the Central Governments and it is an 'authority' within the meaning of Article 12. The composition of the Society is dominated by the representatives appointed by the Central Government and the Governments of Jammu and Kashmir, Punjab, Rajasthan and Uttar Pradesh with the approval of the Ceniral Government. The monies required for running the collage are provided entirely by the Central Government and the Government of Jammu and Kashmir and even if any other monies are to be received by the Society, it can be done only wit the approval of the Slate and the Central Governments. The Rules to be made by the Society are also required to have the prior approval of the State and the Central Governments and the accounts of the society, have also to be submitted to both the Governments for their scrutiny and satisfaction. The Society is also to comply with all such directions as my be issued by the State Government with approval of the Central Government in respect of any matters dealt with in the report of the Reviewing Committee The control of the State and the Central Governments is indeed so deep and pervasive that no immovable property of the Society can be disposed of in any manner without the approval of both the Governments. The State and the Central Government have even the power to appoint any other person or persons to be members of the Society and any member of the Society other than a member representing the State or the Central Government can be removed from the membership of the Society by the State Government with the approval of the Central Government. The Board of Governors, which is in charge of general superintendence, direction and control of the affairs of Society and of its income and property is also largely controlled by members of the State and the Central Governments. Thus the State Government and by reason of the provision for approval, the Central Government also, have full control of the working of the Society.

Learned Counsel for the petitioner has invited my attention to Anx. 1, Memorandum and Articles of Association of State Farms Corporation of India Limited and has submitted that Under Clause (i), the main object for which the Company has been established is to set up and run agricultural farms for the prosecution primarily of seeds of foodgrains etc. in various parts of the country and for that purpose, in the first instance, to acquire from the Government of India the State Farms at Suratgarh (Rajasthan) etc. Learned counsel for the petitioner has further invited my attention to Section 2(a) of the industrial Disputes Act, 1947, which reads as under:

(a) 'appropriate Government' means--(i) in relation to any industrial disputes concerning...(a) any industry carried on by or under the authority of the Central Government (b) or by a railway company (or concerning any such controlled industry as may be specified in this behalf by the Central Government) (c) .. (d) or in relation to an industrial dispute concerning the Industrial Finance Corporation of India established Under Section 3 of the Industrial Finance Corporation Act 1949 or the Employees' State Insurance Corporation established Under Section 3 of the Employees' State Insurance Act, 1948 (34 of 1948) or the 'Indian Airlines' and 'Air India' Corporation established Under Section 3 of the Air Corporations Act, 1953, or the Life Insurance Corporation of India established Under Section 3 of the Life Insurance Corporation Act, 1956, or (e) 'the Agricultural Refinance and Development (ea) Corporation established Under Section 3 of the Agricultural Refineries Corporation Act, 1963, (10 of 1963) or the Deposit Insurance Corporation established) Under Section 3 of the Deposit Insurance Corporation Act, 1961 (47 of 1961) or, the Unit Trust of India established Under Section 3 of the Unit Trust of India Act, 1968 (52 of 1963) or (f)(the Food Corporation of India established Under Section 3, or a Board of Management established for two or more contiguous State Under Section 16 of the Food Corporations Act, 1964, or (g)(a) Regional Rural Bank established Under Section 3 of the Regional Rural Banks Act, 1976, (or)(ga) the Banking Service Commission established Under Section 3 of the Banking Service Commission Act, 1975 on (gb) (a banking or an insurance company, a mine, an oil field) (h) (a cantonment Board,) (i) or a major port, the Central Government, and (ii) in relation to any other industrial dispute, the State Government.

He further submits that reference can be made only Under Section 11 of the Act by the appropriate Government. Learned Counsel for the petitioner further submits that for the purposes of the Industrial Disputes Act, the Central Government should be considered as appropriate Government, as the matter relates to the Central Government.

3. Learned Counsel for the respondent submits that the Central Government is not at all interested in the matter and further-more, this objection has not been raised before the Tribunal below, and as such, the petitioner should not be allowed to raise an objection at this stage. Section 2(a) Clause (i) provides appropriate Government, means in relation to any industrial dispute concerning any industry carried on by or under the authority of the Central Government. It has given a list of number of Corporations created under each statute to show that the Institution referred to Under Section 2(a) though controlled by the Government or run under the authority of the Government have not been included for the purpose of Industrial disputes concerning the Central Government. Thus, it is clear that the Legislature has not only dealt with the industrial disputes carried on by the authority of the Central Government, but has also dealt with a number of Corporations and Companies. For illustration, any dispute relating to the Industrial Finance Corporation of India or State Insurance Corporation or India Airlines or Agricultural Refineries Corporation has been illustrated in Section 2(a) of the Act. Under Clause (ii) in relation to any other industrial dispute, the State Government is the competent authority. The definition of the State has to be interpreted in its way for the purpose of interpreting the law. The State, as interpreted Under Article 12, cannot be interpreted for the purposes of Article 31 also. The scope of State under Article 12 is wide enough to cover all the institutions which are instrumentals or agencies for carrying out the functions of the State Government. The Companies registered under the Companies Act or Societies registered under the Societies Act or the Corporations created under the Statutes, cannot be given wider interpretation for the purpose of Article 311 of the Constitution of India. All these Companies, Corporations and Societies are governed for the purpose of the conditions of service according to rules framed by the Companies, Corporations or Societies, and Article 311 does not apply to all. This is a guide for interpreting the expression 'Central Government' as used in Section 2(a) of the Industrial Disputes Act. The Legislature in its wisdom his used the word 'Central Government' in Section 2(a) instead of the word 'State'.

4. Mr. Lodha, learned Counsel for respondent No. 1, has invited my intention to the case of Natarajan and Ors. v. Regional Assistant Commissioner of Labour and Ors. (ILR 1973 A.P. 1078), the relevant part of which reads as under:

If a Company is registered under the Companies Act although the Government is the share holder having all the shares in its credit, having the power to nominate all or majority of Directors does not after the character of the Company and the Company of hereby become an industry run either by Govt. or under its authority. The appropriate Govt. with respect to or Industrial dispute in such an Industry is State Govt.

He has further invited my attention to the case of N.T. Com. Employees Union v. Manohar Singh . The relevant part of which reads as under:

The govt. of the State within which one of the office of a Company is situate is the appropriate government.

He has relied on the case of Abdul Rahman v. Mrs. E. Paul : (1962)IILLJ693Bom . The relevant part of which reads as under:

The State Firm Corporation is not Industry directly under the authority of Central Government. Hence that is not appropriate government.

5. In the case of Tea Board v. First Industrial Tribunal, West Bengal (1978) Lab. I C. (NOC) 179 (Cal) D.B, their Lordships have specifically held as under:

In the absence of a statutory provision, however, a commercial corporation acting on its own behalf, even though it is controlled wholly or partially by a Government Department, will be ordinarily presumed not to be servant or agent of the State. The mere fact that Minister appoints the members or Directors of a Corporation and he is entitled to call for information, to give directions which are binding on the Directors and to supervise over the conduct of the business of the corporation, does not make the corporation an agent of the Government.

In the case of Heavy Engineering Mazdoor Union v. State of Bihar, 1969 (II) ILJ 549, their Lordships have held as under:

That Heavy Engineering is not working under the authority of the Government.

The term 'appropriate Government' is defined in Section 2(a), is exhaustive in relation to any industrial dispute concerning the industrial undertaking or establishment neumerated in the clause, the Central Government is the appropriate Government. The word 'concerning means 'releting to, regarding, respecting, about-an affair that concerns one'. The word 'concerning' must be construed in a reasonable manner, and referring to such industrial disputes as have got aproximate, intimate and real connection with the establishments or authority mentioned in the definition and not a connection with is far-fetched, remote and hypothetical. It would, therefore, be a question of fact in each case, to be decided with reference to the facts of that case, whether an industrial dispute is one concerning any of the corporations or authorities mentioned in the definition.

6. The petitioner cannot be allowed to raise a question of fact for the first time in the writ jurisdiction. He has waived his right of raising an objection by not raising it before the proper forum at the appropriate time, and the petitioner is estopped from raising the new questions relating to jurisdiction.

7. The petitioner has only stated in para 8 of the writ petition 'that from a reading of the same it will be clear that the petitioner company is being carried on by and under the authority of the Central Government and, therefore, the appropriate Government within the meaning of Section 2(a) read with Section 10 of the Industrial Disputes Act, 1947 is the Central Government'. Thus, the petitioner once drew an inference on the basis of Anx. 1, which was not drawn before the Tribunal below. He does not stated affirmatively that the petitioner-company is working under the authority of the Central Government. In para 12(a) of the writ petition, the petitioner has only mentioned that 'since the petitioner is a company by the Central Government....

8. It is an admitted position that the Central Government is not carrying on directly the Industry. The Company is not a department of the Central Government. The Company is a juristic person and is carrying on the business. The petitioner has not even stated in the grounds that the petitioner in carrying on the Industry under the authority of the Government.; The word 'authority' must be construed according to its ordinary meaning' and, therefore, must mean a legal power given by one person to another to do an Act. In other words, a person is said to be authorised or to have an authority when he is in such a position that be can act in a certain manner without incurring liability, to which he would be exposed but for the authority, or, so as to produce the same effect as if the person granting the authority had for himself done the act. The words 'under the authority of' mean pursuant to the authority such as where an agent or servant acts under such authority of his principal.

9. I do not find any force in the submissions made by the learned Counsel for the petitioner and hold that the State Government was justified in making the reference.

10. Contention of the learned Counsel for the petitioner is that the petitioner was working as consultant in sales tax matters Every person who is having a common knowledge of the fact can well understand that the person cannot sit idle and he has to try for his livelihood. He is not expected to die because of starvation. No question has been asked to the respondent that what was his income and how much he was earning.

11. In the case of S.K Verma v. Industrial Tribunal-cnm-Labour Court, New Delhi : (1981)ILLJ386SC , their Lordships have considered the point and have awarded full back wages.

12. I do not find any infirmity in the judgment of the Court below.

13. The writ petition is rejected. Parties are left to bear their own


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //