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Amal Kr. Ghatak and Vs. State of West Bengal and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtKolkata High Court
Decided On
Judge
Reported in(1971)IILLJ248Cal
AppellantAmal Kr. Ghatak And;srinathpur Tea Co. Ltd.
RespondentState of West Bengal and ors.
Cases Referred and Travancore Rayons v. Union of India
Excerpt:
- .....of 1965. it is the validity of these orders which is the subject matter of challenge in these two rules.3. these rules are being contested by the respondents and mr. sanyal and mr. das gupta are appearing for the respondents in the two rules.4. mr. chaudhuri appearing in support of these rules has raised a simple but an import ant point. mr. chaudhuri contends that section 36 must be construed to contemplate a quasi judicial determination as to whether on existence of certain circumstances a particular industry or a particular class of industries should be exempted from the operation of any or all of the provisions of the act and whether such exemption should be unconditional or subject to certain conditions. according to mr. chaudhuri unless section 36 is so construed and on the other.....
Judgment:

Anil Kr. Sen, J.

1. These two rules were issued on two writ petitions. These rules have been heard together as they involve common questions of law on facts which are similar. Both the petitioners are the owners respectively of the two tea estates referred to in their petitions and both of them are challenging in their respective petitions orders passed by the State Government refusing to grant them the exemption prayed for under Section 36 of the Payment of Bonus Act, 1965.

2. The petitioners' case is that they had been carrying on the business of producing tea under very adverse circumstances. They arc heavily indebted and they are maintaining their tea gardens under adverse economic circumstances due to low yield, poor quality of products, uneconomic areas, inaccessibility of the gardens and similar other circumstances. According to them in the reports of the National Council of Applied Economic Research it had been found that the petitioners are carrying on their business under heavy indebtedness and under adverse circumstances. The petitioners claim that such being the condition of the business carried on by them, they applied in 1965 to the State Government for being exempted from the obligations under the said Bonus Act, 1965. The State Government sat over this application for more than one and a half years and ultimately disposed of the application by recording the following order:

With reference to your letter No. 1092/M-41 dated 15-9-1965 on the above subject, I am directed to say that Government do not consider your prayer for exemption from the provision of the Payment of Bonus Act, 1965 to be justified.

The order is cyclostyled and on both the petitioners similar orders have been served by the respondents in disposing of their applications for exemption under Section 36 of the said Bonus Act of 1965. It is the validity of these orders which is the subject matter of challenge in these two rules.

3. These rules are being contested by the respondents and Mr. Sanyal and Mr. Das Gupta are appearing for the respondents in the two rules.

4. Mr. Chaudhuri appearing in support of these rules has raised a simple but an import ant point. Mr. Chaudhuri contends that Section 36 must be construed to contemplate a quasi judicial determination as to whether on existence of certain circumstances a particular industry or a particular class of industries should be exempted from the operation of any or all of the provisions of the Act and whether such exemption should be unconditional or subject to certain conditions. According to Mr. Chaudhuri unless Section 36 is so construed and on the other hand is construed to confer absolute discretion in the hands of the State Government, the mandatory obligations imposed by the statute would amount to imposition of unreasonable restriction on citizens' right to carry on any occupation, trade or business. There is some force in this contention of Mr. Chaudhuri and the Assam High Court has actually held the determination to be quasi judicial in character. Reference may be made to the decision of the Assam High Court in the case of A.K. Ghatak v. The State A.I.R. 1971 Assam page 32.

5. In my view, however, it may be necessary to enter into the wider controversy as to whether Section 36 contemplates an adjudication and whether such adjudication is judicial or quasi judicial in character. Section 36 is in following terms.

Section 36. If the appropriate Government, having regard to the financial position and other relevant circumstances of any establishment or class of establishments is of opinion that it will not be in public interest to apply all or any of the provisions of this Act thereto, it may, by notification in the official Gazette, exempt for such period as may be specified therein and subject to such conditions as it may think fit to impose, such establishments or class of establishments from all or any of the provisions of this Act.

6. I am of the view that in any event Section 36 contemplates a determination and exercise of discretion guided and limited by the provision itself. Such discretion is not absolute in the sense that it is not justiciable at all. The section indicates that exemption should be given or refused on the consideration of public interest. Again, the section itself lays down what should be the consideration for arriving at the decision on the question of public interest. To quote the words of Lord Radcliff in Nakoda Ali v. Jayaratne [1951] A.C. 66, the section is so worded that words used are 'intended to serve for some sense as a condition limiting the exercise of an otherwise arbitrary power'. Here the statute goes further. Not only does it limit the exercise of powers with reference to public interest but lays down the guide line for determination of such interest. This being the position irrespective of consideration whether the determination is quasi judicial or administrative, it is justiciable to the extent that it is truly based on a bona fide decision as to requirements of public interest and further that such decision is based on consideration of facts relevant on the provisions of the statute itself. It is now well settled that the dividing line between administrative and quasi judicial powers is quite thin and is being gradually obliterated and even exercise of administrative powers, which are not absolute, is justiciable though subject to limitation which may vary from case to case on the provisions of each statute conferring such power. It is always justiciable to find out whether it is based on a bona fide decision or not. Reference may be made to the cases, King Emperor v. Sibnath Banerjee 72 I.A. 241, State of Bombay v. K.P. Krishnan : (1960)IILLJ592SC , Barium Chemicals Limited v. Co. Law Board : [1967]1SCR898 , and Rohtas Industries Ltd. v. S.D. Agarwal : [1969]3SCR108 .

7. Judged on the principle above referred to I have come to the conclusion that the decision was never arrived at in conformity with the power. I go still further and hold that the power was exercised mechanically without application of mind at all far less to the considerations required under the statute. As pointed out hereinbefore the impugned orders are issued in stereotyped forms and give no reasons except saying that the prayer for exemption is not justified. Nothing appears from the order to indicate that the appropriate authority was at all conscious of the facts and circumstances which were required to be considered in arriving at the decision or that such facts and circumstances were at all considered. In my view it was necessary for the respondent State to make a bona fide assessment in the light of the provisions of the statute and pass a speaking order, so that it may be known to the parties affected by the order that it is based on relevant consideration. Here in the present cases all the relevant circumstances which could entitle an industry to claim such an exemption had been pleaded in their applications for exemption and had been pleaded in the writ petitions to this Court as well. They have not been denied or disputed by the respondent. As a matter of fact the respondents have not filed any affidavit whatsoever. Under such circumstances this Court gave opportunity to the learned Counsel for the State to produce the original records to show if therein there exists any speaking order which could indicate how the applications of the petitioners had been disposed of. But the learned Counsel for the State have failed to produce any such record. I have reasonable grounds to believe that there exists no other order than the order as communicated to the petitioners. Therefore there is no proof even aliunde that there was a valid determination of the issues involved or that the determination is based on relevant consideration. That apart on more occasion than one the Supreme Court has condemned this procedure on the part of the State authorities to dispose of such matters by issuing printed or cyclostyled orders which by their nature indicates in application of mind. Reference may be made to the decision in the case of Bhagat Raja v. Union of India 1960 (2) S.C.A. 253. Similarly the Supreme Court has also condemned disposal of such issues without assigning any reason in the cases of Mahabir Prasad v. State of U.P. : [1971]1SCR201 , and Travancore Rayons v. Union of India 1971 (1) S.C.A. 559. In my view principles underlying the aforesaid two decisions are equally applicable to the determination and exercise of powers as under Section 36 of the said Bonus Act, 1965, even if exercise of such powers be administrative in its character. Therefore, I have come to the conclusion that I must uphold the contention of Mr. Chaudhuri that these impugned orders must be set aside on the ground that they are not speaking orders and they betray exercise of powers mechanically.

8. On the conclusions as above these applications succeed. The rules are made absolute. The impugned orders, passed by the State of West Bengal dismissing the petitioners' prayer for exemption under Section 36 of the Payment of Bonus Act, 1965, are hereby set aside and the said respondent is now directed to dispose of the said applications afresh after giving the parties interested including the petitioners an opportunity to be heard in accordance with law. Let a writ in the nature of mandamus do issue commanding the respondents not to give effect to the impugned order and further commanding the said respondent, the State of West Bengal, to dispose of the applications for exemption under Section 36 of the Payment of Bonus Act, 1965 in accordance with law. It is highly desirable that since the application was filed as early as in the year 1965 the State Government should take appropriate steps to dispose of the matter without any further avoidable delay. There will be no order for costs in these two rules.


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