State of Rajasthan & Another versus Hart Ram Nathwani & Ors.

B 1'.<ii11in1.u111 Wages Act (11 of 1948) ss. 5(C) (e), 7 and 9-Appointment of gove·rnnient officers on cornmittees and Advisory Board as independent members-Propriety-Advisory Board appointing its own sub .. c:o111mittees-Propriety --S. 5{1)(a), scope of.

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ction 5 ( l ) of the Minimum Wages Act. 1948, provides two types of procedure for fixing and revising minimun1 Wa$es in respect of any scheduled employment. Section 7 provides for the· appointment of an Advisory Board. c If the procedure provided in s.5(1)(a) is followed consultation with the Advisory Board is not re.quired while it is mandatory in case· the procedure in cl. (b) is followed. Under cl. (a), the Government can appoint as many Committees. or sub-committees as it considers necessary to hold inquiries and advise it in respect" of such fixation or revision. Section 9 requires that every committee, sub-committee and the Advisory Board shall consist of representatives of the. employtrs and empioJres in eQ:ual numbers and independend persons, whose number shall not exceed 1/3 of the total number of members. One of the independ"ent persons shall be appointed Chairman. [643 G~644 F]

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In the present case. the State Government followed the procedurl! under cl. (a) and appointed a committee i'or revising the wages with resPect to employ1nent' in Mica 1.1ines which is a scheduled employment undier the Act. The committee consisted of five members, two representatives of the employers, two of the employees and a Professor oi' Economics of a Government college as an independent member.. It submitted its report to the Government. The Government. referred the matter to the Advisory Board which consisted of 21 E members, ~ representatives of the employers. 8 of the employees and 5 government officers as independent members. The Advisory Board appointed a sub-committee 10 go further into matter. In the sub~committce were taken same persons who were not members of the Advisory Board. The rulJ.... commiue·e made its recommendations and the Advisory Board after considering those recommendations also submitted its report and the State Government accepted it with slight variations and fixed minimum wages by a notification. The respondent challenged its validity . and the High Court struck it down holding that, (i) the constitution of the Wage Committee and. the Advisory F Board was not valid because the economics professor and the 5 government members were not independent members, (ii) the Board had exceeded its power in appointing a sub-committee, and, (iii) the Board committed an illegality in taking into consideration its recommendations while submirting its report to the Governn1ent.

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Allowing the appeal to this Court,

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HELD : ( 1) It may be that in certain circumstances trersons who are in G sefvice or the Government may cease to have an independent character if the question arises of fixation of minimum wages in a scheduled employment. In the easel of fixation of minimum wages in a scheduled employment in '':hich the Government is directly interested, whether Government servants can come in the category of fndependent members in addition to the Government officers who come on the Board or Committee as representatives of the employers is a matter which~ has to be considered in an appropriate case. But in the instant case, the constitution Qf the¹ Wage c·ommittee or the Advisory Board was not bad, as Government was not an employer in. the 11ica Min'es in respect of H which minimum. wages were fixed. [646 A-El

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The State of Andhra Pradesh v. Naraycina Velur Beedi Manufacturing Factory and o.thers [1973] 1 Labour Law Journal. 476, followed.

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[1976] 1 S.C.R.

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642

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SUPREME COURT REPORTS

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(2)TheAdvisory Boardcandevice itso'.vnprocedureanJcollectinfer~ rn::i.tionbynppcii·11nentofsub-co1nmittec-scons·i'lting only of some of its members. But the Advisory Board hasnopov.'er to appoint a rival snb- comm,itteetothe one appointed by theGovrnn1..::ntand take in such sub- committee, pep;ons who arenotmen1bers of the Board as was' done in this case. Therefore. the Advisory Board committed :in irregularity in appointing thesub-committee and taking into consideration its report. [646 E-G]	A
(3)ButitJoesnot followth<ittheirnpuncdnotification based upon the reporLofthe Advisory Board was hade"Cnifthe irregularity,isa!'.sumedto beanilleglity. Therecommendations n1adebytheBoardeven on con- siOerationofthe reportof- itssub-committee\.'a<>only' thatofthe Adviory Board. Since th:: procedure was unders.5 ( 1)(a)itwasnotn1andatoryfor Governmenttotakeheopinlonofthe Advisory Boa!·datall. Therefore, the impugned notification and theproce::::ding<:ipursuant toitcJ.nnotbequa:':.h1:<l. [646 G-647BJ	B	'•
Gulan1aha111ed T(Fasahcb, aBidifactoryhyitsproprietors Shanlraoand _others_v._Stati' oJDo111bayando!hcrs_A.I.R. 1962 Bombay97.referred to. CIVILAPPELLATEJURISD!CTICJN :CivilAppealNo. 1800 of 1969. Appeal by special leavefromthe Judgment and Order dated the 25th January., 1967ofthe Rajasthan High Court in D.B. Civil Writ Petition No.40(1of1966. _S.M.Jain,_for the appellant. 1hcJudgment oftheCourtwasdelivered by UNTWAUA,J.-Thehearingofthis appca:filedbythe State of Rajasthan and another by special leave proceeded ex-partc against the respondents. After examiningallthe pros and cons of the dispute involved in this appeal withtheassistance of the learned counsel for the appellantswehave come to the conclusiontt?atthe appcai should be allowed. _Frqm_time to time the Government of Rajastha',1fixedor revised the minimum rates ofwagesfor employeesinthe Mica Mines through- out the State of Rajasthan under section5(2)of the Minimum Wages Act,1948-CentralAct11of 1948-hereinafter called the Act. The employmentinthe Mim Minesisa scheduled employment within the meaning of section2(g)of the Act-Eventually the minimum rates of wages werefacdby the Government by a notification dated the 3 lst July, 1965, the validity of whichwaschallenged in the Rajasthan High Court by several employers in the Mica MinesinCivil Writ No. 406/1966and15other writs. Several proceedings initiated on the basis of the impugned notificatio.1 were also challenged by theem- ployers. A Bench of the Rajasthan High Court allowed the writ applications, quashed ,the impugned notification and the proceedings takeninpursuance thereof. This appeal arises out of Civil Writ No. 406/1966in which the employerisrespondent no.1.	C D E F G	\|

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The notification dated 31-7-1965 was challenged on several grounds ·and we will be concerned with some of them in this appeal. The relevant facts are these. 'For the purpose of revising the minimum H wages fixed by the earlier notification dated the 2'>llr April, 1959,'the State Government in the first instance appointed a Committee consisting of five members on the 17th May, 1962. The constitution of the

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RAJASTHA~ V, HAR! RAM (Untwalia, !.)

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643

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A Committee was, however, revised by notification dated the 26th November, 1962. This committee consisted of five members, two rcpresentati'es of the employers, two representatives of the employees and one, Professor K. S. Mathur, Head of the Department of Economics Degree

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• College, Ajmer. The last was tak~n as an independent member of the committee. It submitted its report to the Government. The matter was referred by the Government to the Advisory Board wasti-

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B tuted under section 9 of the Act. . It appears that a Sub-committee was appointcl\ by the Advisory Board to go into the matter further and to consider the report of the Wage Committee appointed earlier by the Government on the 26th November, 1962. In the Sub-committee were taken some persons who were not members of the Advisory Bonrd. The Sub-committee also submitted its report to the Advisory

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c Board which consisted of 21 members, 8 employers' representatives, 8 employees' rcprcsrntatives and 5 Government officers appointed in the category of independent members. The proceedings of the Buard <lntcd the 7th May, 1965 showed that it considered the recommendations of the Wage Committee and the Sub-committee and then submitted its report containing its recommendations of the. wage structure suggesting an alternative scale of m:•aimum wages according as the link-

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f D ing of Drnrness Allowance with the consumer-price-indices. The State Government accepted the wage structure recommended oy the Board but with slight variation in the matter of the linking basis with Dearness Allowance and made it all ;•,1clusive rates of minmum wages per month.

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The learned Acting Chief Justice of the Rajastt:an High Court who .

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E delivered the leading judgment in the case, on a consideration of the various divergent decisions of the High Courts came to the conclusion that the constitutiG',1 of the Wage Committee was not valid as •he Professor of the Government College was no~ an independent member. Similarly the constitution of the Advisory Board was also bad as the five Government officers on the Board could not be said to ho independent members. He was also of the view that the Board had exceeded

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F its power in appointing a Sub-committee :rad committed an illegality in taking into consideration its report while making recommendations

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·to the Government. The other learned Judge with some amount of reservation and diffidence agreed to the order proposed by the learned Acting Chief Justice. It may be stated hete that the fixation of the minimum wage in the ngtification dated the 31st July, 1965 was also challenged before the High Court on certain grounds relating to the

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G merits of the fixation but the High Court has over-ruled such objections .

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Section 5 of the Act provides the procedure for fixing •a·ad revising minimum wages in. respect of any scheduled employment. There are two tyPes of procedure indicated in clauses (a) and (b) of sub-section (1). Obviously in the present case the procedure followed was the one.provide? in clause .<a). We shall now read sub-section (2) of sectwn 5 with the proviso appended thereto :

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..

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"After cdasidering 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

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SUPREME COURT REPORtS [1976] I S.C.R.

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fl44

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date specified in the notification under clause(b)fthtsu section, the appropriate Government shall, bynollfica10nm the Official Gazette,fix,or,asthe rnse may be, revise the minimum rates of wages in respect of · each scheduled employn1ent, and unless such notification othcrwii:;:c provides, it shall come into force on the expiry of three months from the date of its issue : Provided that where the appropriate Government pro- poses to revise the minimum rates of wages by the mode specified in clause (b) of sub-section(!),the appropriate Government shall con.suit the Advisory Board also."	A B	• )'t I
Itwouldbenoticed that the powertofixthe minimumwagesis of the Government. Uader clause ( e) of sub-section(I)the Govern- mcnt can appointasmany committees and sub-committees as it consi- ders necessary to hold enquiries and advise it in respect of such fixa- tion or revision of minimum wages. Section 7 of the Act says "Forthe purpose of co-ordinating the work of commit- tees and sub-committees appointed under section 5 and advis- ing the appropriateGovcrnm~ntgenerally in the matter of fixing and revising minimum rates of wages, the appropriate Government shall appoint an Advisory Board."	C D	1 \|
Ifthe procedure providedinclause(a)isfollowed, consultation with the Advisory Boardisnot required in terms butisresorted to whik itismandatoryincase of procedure(b).Section 9 provides : "Each of the committees, sub-committees and the Advisory Board shall consist of persons to be nominated by the appro- priate Government representing employers and employees in the scheduled employments, who shall be equal in number, an_dindependent persons not exceeding one-third of its total number of members; one of such independent persons shall be appointedtheChairman by the appropriate Government."	E F
The questionastowhether a Government officer could be appointed on a Committee" Stib-committtecor.the Advisory Boardasan independent person came up for consideration before the various High Courts. Majority of them took theviewthat it could be so.A_fewHigh Courts, however took a contraryview.In the judgment under appealthe.High Court of Rajasthan has fallen in the line of the minority. But recently the point has been set at rest by a decision of this Court in_The Stateof _Andhra Pradesh_v.Narayana Velur Beedi Manufacturing Factory and others(!). Weconsideritappropriate to quote the whole of para- graph 10 of that judgment : "In our judgment theviewwhich has prevailed with the Majorityofthe High Courts must be sustained. The commit- teeorthe advisory board can only tender advice which is not binding on the Government while fixing the minimum wages (i)-[f973]1LabourLawJournal476.	G H

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RAJASTHAN v. HARi RAM (Untwalia, !.)

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64!>

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A or revising the same as the case may be. Of course, the Government is expected, particulady in the present .deniocratic set up, to take that advice seriously into consideration and • act on it but it is not bound to do so. The language of s. ~ does not contain any indication whatsoever that persons in the employment of the Government would be excluded from the category of independent persons. These words have essentially B been employed in contradistinction to representatives of employers and employees. In other words, apart from the representatives of employers and employees there should be persons who should be independent of them. It does not follow that persons in the service or employ of the Government were meant to be excluded and they cannot be regarded as. independent persons vis-a-vis the representatives of the emc ployers and employees. Apart from this the presence of high Government officials who may have actnal working knowledge· about the problems of employers and employees can afford a. good deal of guidance and assistance in formulating the advice • which is to be tendered under S. 9 to the appropriate Government. It may be that in certain circumstances such per- 1 sons who are in the service of the Government may cease to D have an independent character if the question arise of fixation of minimum wages in a scheduled employment in which the appropriate Government is directly interested. It would, therefore, depend upon the facts of each particular case whether the persons who have been appointed from out of the class of independent persons can be regarded as independent or not. But the mere fact that they happen to be GovE ernment officials or Government servants will not divest them of the character of independent persons. We are not impres. sed with the reasoning adopted that a Government official will have ·a bias or that he may favour the policy which the appropriate Government may be inclined to adopt because when he is a member of an advisory committee or board he is expected to give an impartial and independent advice and F not merely carry out what the Government may be inclined to do. Gov·ernment officials. are responsible persons and it cannot be said that they are not capable of taking a detached and impartial vi~."

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The learned Acting Chief Justice of the High Court considered many of such decisions of the High Courts in his judgment and posed " question G "Suppose, the Government is an employer in the particular scheduled employment for which wages are sought to be fixed under the Act. Could it be postulated in such a case that art officer of the Government • can be property appointed as an 'independent' person on any of the statutory bodies in question?" An answer in the negative was given. He then said "I need hardly add in this connection that if the Government be not an employer in any of the scheduled employments, there H would be no objection to the Government officers of the requisite calibre and experience being appointed as independent persons within the meaning of the section" .. But thinking that in the list of the scheduled employment are included "employ1U.ents such as public motor transport,.·

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(1976] 1 S.C.ll.

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6 46

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SUPREME COURT REPORTS

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.and construction and maintenance of roads and building operations and may be, for aught we know, in certain other employments also" in which the State Government is an employer and the Advisory Board constituted is meant for advising the Government in those employments also he held the constitution of the Advisory Board to be bad. In the extract which we have given above from the decision of this Court a sentence is to be found resembling the line of thinking of the learned Acting Chief Justice. This Court has said "It may be that in certain circumstances such persons who are in the service of the Government may cease to have an independent character if the question arises of :fixation of minimum wages in a scheduled employment in which the appropriate Goverrn)lent is directly interested" The question as to whether in such a situation a Government officer appointed on the Board or a Committee can be said to be independent member or not will have to be cautiously considered when an appropriate occasion arises for the same. After all, even in such cases the final authority fixing or revising the minimum wages in a scheduled employment is the Government. Government officers can undoubtedly come on the Board or the Committee as representatives of the employers. Whether in such a situation more Government servants can come in the category of th" independent members is a question which is open to serious debate and doubt. But in the instant case on the authority of this Court it is clear that the constitution of either the Wage Committee or the Advisory Board \Vas not bad, as the Government was not an employer in the J.1ica Mines in respect of which employment only minimum wages were fixed by revision in the notification dated the 31st July, 1965.

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No procedure has been prescribed in the Act as to the method which the Advisory Board is to adopt before making its recommendations to the State Government. It can devise its own procedure and collect some informations by appointment of a sub-committee consisting only of some of its members as was the case in the decision of the Bombay High Court in Gulanwhamed Tarasaheb, a Bidi Factory by its proprietors Shamrao and others v. Stiate of Bombay and others(1¹ ). But surely the Advisory Board has no power to appoint a . rival subcommittee to the _one appointed by the Government and take in such subcommittee persons who are not members of the Board, as was done in this case. There is, therefore, no doubt that the Advisory Board committed an irregularity in taking into consideration the report of the sub-committee invalidly appointed by it. Does it necessarily follow from this that the impugned notification dated 31-7-1965 based upon the report of the Advisory Board which in its turn had taken into consideration not only the report of the Committee appointed by the Government but also that of the sub-committee appointed by the Board is bad? 'On a careful consideration of the matter we give our answer in the negative. The irregularity, even characterising it as an illegality, committed by the Advisory Board in taking into consideration the report of the &ub-committee was not such as to nullify its recommendation contained in its report, or, in any event, the final decision of the Government contained in the impugned notification. It must be remembered that the procedure followed in this case was the one provided in section 5 ( 1) .

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1_1}A!.R. i962lfombay 97.

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RAJASTHAN V, HAR! RAM (Untwalia, J,)

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647

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A (a) in which case it was not mandatory for the Government to take the opinion of the Advisory• Board. After all, the recommendations made by the Board even on consideration of the report of the Sub-committee ... along with that of the Committee was the advice of the Board. The · Government did accept it but accepted it after some modification. ln such a situation we do not think that the notification dated 31-7-1965 B deserves invalidation. It follows as a corollary that the· proceedings started pursuant to the notification cannot also be quashed.

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In the result we allow this appeal, set aside the judgment and order of the High Court and dismiss the connected writ application filed by respondent No. I. Since he has not appeared there will be no order as to costs.

V.P.S.

Appeal al/mred.

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State of Rajasthan & Another v. Hart Ram Nathwani & Ors.

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State of Rajasthan & Another v. Hart Ram Nathwani & Ors.

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