Sourth Gujarat Textile Processors Association v. STATE
1993-10-19
A.P.RAVANI, C.V.JANI
body1993
DigiLaw.ai
C. V. JAM, J. ( 1 ) IN these three petitions under Article 226 of the Constitution of India, notifications issued by the State government of Gujarat under Section 10 of the Contract Labour (Regulation and abolition) Act, 1970, hereinafter referred to as the act, have been challenged, and since common points are involved in the three petitions, they are being heard and decided together. ( 2 ) A. Special C. A. No. 3754/85 is filed by a firm of contractors engaged in the business of performing job contract work of screen printing of Art Silk Fabrics on behalf of certain principal employers at Surat. They have challenged the notification Annexure-A dated March 11, 1985, issued by the State Government on the recommendation of the State advisory Contract Labour Board prohibiting the employment of contract labour in the establishments of Art Silk textile Units in Surat District and surrounding areas in respect of processes of bleaching, finishing and dying and printing The petitioners have also challenged the vires of Section 10 of the act. 2. B. Spl. C. A. No. 2512/85 in which the said Notification has come under challenge, had been filed by South Gujarat textiles Processors Association, and other petitioners engaged in the business of processing man-made fabrics at Surat and Bulsar. 2. C. The third petition, namely, Spl. C. A. No. 8851/89, filed by the same employers Association is directed against the subsequent Notification dated 26th may 1989, issued by the State government of Gujarat under Section 10 of the Act, prohibiting the employment of contract labour in the establishments of Art Silk Textile Processing Units in respect of dyeing, bleaching, finishing and printing processes throughout the State of Gujarat, after consultation with the state Contract Labour Advisory Board appointed under Section 4 of the Act. 2. D. As stated earlier, the grounds on which the challenge to the two notifications is based, are common. Therefore at the request and with the consent of all the Advocates appearing for the parties all the three petitions are being decided together. Special C. A. No. 3754/85 incidentally, contains the challenge to the vires of Section 10 also.
2. D. As stated earlier, the grounds on which the challenge to the two notifications is based, are common. Therefore at the request and with the consent of all the Advocates appearing for the parties all the three petitions are being decided together. Special C. A. No. 3754/85 incidentally, contains the challenge to the vires of Section 10 also. ( 3 ) THE following undisputed facts require to be noted: as certain representations had been made by the Union of Employees (INTUC, south Gujarat Branch), for abolition of contract labour system prevalent in the dying and printing processes of Art Silk processing Union in Surat, an Advisory board was constituted, consisting of 11 members and presided over by a Retired judge of this Court. A reference was made to the said Board calling for its report on the question whether the contract labour system should be abolished or not. After receiving the reference the Board issued notices to various Art Silk Textile processing Units working in Surat and neighbouring areas and called for certain information in Pro formas. The Board received information from different units and it was found that contract labour system did not exist in five specified units or establishments. South Gujarat Textile processors Association, petitioner in Spl. C. A. No. 2512/85 as well as Sp. C. A. No. 8851/89, which is an Employers association, having on its register 129 members carrying on processing work in surat and neighbouring areas filed its reply. Information and replies were also received from other employees Union and contractors, but only two contractors took part in the deliberations. The meeting held by the Advisory Board was attended by the representatives of the establishment and employees Union. The Board also visited and took inspection of the factories and made a note of the local inspection. After taking into consideration the Pro forma information received from the different units and replies as well as letters received from the employers and contractors, and after holding several meetings and deliberations with the different interests, the Advisory Board noted the views of the principal employers as well as the contractors who were of the opinion that in the three processes, namely, bleaching, finishing and dyeing, contract labour system prevalent therein should be abolished forthwith. Regarding printing process the members were of the opinion that the contract labour system should be abolished phase-wise.
Regarding printing process the members were of the opinion that the contract labour system should be abolished phase-wise. The Advisory Board formed an opinion that these activities were of perennial nature, that there was sufficient work to employ considerable number of whole- time workmen and that the processes carried on in the industry were incidental and necessary for the industry. It was also recorded that these processes were actually being carried on upto the year 1973 ordinarily through regular workmen and it was some time in the year 1973 that agitation was carried on against the employer on behalf of the employees and so, as a counter measure, the employers resorted to the device of engaging licensed contractors who would supply necessary labour. Thus on being satisfied about the relevant factors specified in clauses (a) to (d) of sub-section (2) of Section 10 the Advisory Board submitted its recommendation that contract labour system prevalent in the four aforesaid processes in Art Silk Textile Processing units operating in the city of Surat and in the neighbouring areas including Bulsar and Navsari should be abolished. The state Government took into consideration the report and recommendations of the advisory Board, and having regard to the conditions of work and benefits provided for the contract labour and other factors enumerated in Clauses (a) to (d) of sub-section (2) of Section 10 of the Act issued a notification dated 11-3-1985 prohibiting the employment of contract labour in the establishments of Art Silk textile Processing Units in respect of the aforesaid four processes in the city of surat and in the neighbouring areas including Bulsar and Navsari. ( 4 ) A. It appears that on the same day i. e. , on 11-3-1985 a reference was made by the State Government of Gujarat to the same Advisory Board under Section 10 of the Act in order to decide whether contract labour system should be abolished in Art Silk Processing Industry located in other areas of the State, namely, bulsar, Bharuch, Ankleshwar, ahmedabad and Jetpur in respect of the same processes of dyeing, bleaching, finishing and printing. On receipt of the reference the Board issued notices and pro formas for information to the establishments located in the areas of bulsar, Bharuch, Ankleshwar, ahmedabad and Jetpur, but no information was received.
On receipt of the reference the Board issued notices and pro formas for information to the establishments located in the areas of bulsar, Bharuch, Ankleshwar, ahmedabad and Jetpur, but no information was received. The Board, therefore, by way of abundant caution directed a notice to be published in a gujarat Daily Newspaper calling upon the establishments concerned to appear for hearing on 21-5-1987, but none of these establishments sent any statement in response to the notice, excepting M/s. Nanikram Shobraj Art Silk Mills which appeared for the hearing and filed its statement. Another Industry, namely, reliance Industries Ltd. , which had made inquiries about information to be given, did not furnish the information nor did it appear at the time of hearing. The Board found from the statement submitted by nanikram Shobraj Silk Mills that contract labour was employed in the works of white washing, transport of coal, mending work in canteen and inserting pins in the beam, but not in the four processes indicated hereinabove, which were being done through regular workmen. 4. B. When the Board visited the reliance Industries (Textile Division) the members found that no contract labour was being used for any of the aforesaid four processes, but contract labour was used for internal handling, house keeping, cleaning, overhaulting etc. , but these processes were not the subject-matter for which the reference was made. 4. C. The Board took into consideration its earlier findings in respect of the four aforesaid processes carried on in Surat and neighbouring areas as well as similar situation prevailing in the rest of the State, and came to the conclusion that contract labour was required to be abolished in the four aforesaid processes in Bulsar, ankleshwar, Ahmedabad and Jetpur and other neighbouring areas of the State of gujarat. The Board specifically recorded its distress that even the workmens union, Labour contractors and the labourers did not appear before the Board in spite of public notice and that the Board had no other alternative but to decide the reference on the materials on record. The Advisory Board, therefore, recommended that employment of contract labour in the aforesaid four processes in Art Silk Processing Units in Bulsar, Bharuch, Ankleshwar, ahmedabad and Jetpur areas required to be prohibited.
The Advisory Board, therefore, recommended that employment of contract labour in the aforesaid four processes in Art Silk Processing Units in Bulsar, Bharuch, Ankleshwar, ahmedabad and Jetpur areas required to be prohibited. After taking into consideration the report of the Advisory board and also the relevant factors enumerated in Clauses (a) to (d) of sub-section (2) of Section 10 of the Act the State Government of Gujarat issued a notification dated 26th May 1989, prohibiting employment of contract labour in the establishments of Art Silk textile Processing Units in the State of gujarat in respect of dyeing, bleaching, finishing and printing processes. This notification dated 26th May 1989, is specifically under challenge in Spl. C. A. No. 8851/89. ( 5 ) THE proceedings and the report of the Advisory Board which resulted in the issuance of the notifications are dealt with at length hereinabove in order to appreciate as to whether the appropriate government had adopted all possible safeguards before issuing notifications for prohibition of contract labour under section 10 of the Act. ( 6 ) A. Before we deal with various submissions made on behalf of the petitioners, it will be worthwhile to dispose of the contention regarding constitutional validity of Section 10 of the Act taken in Spl. Civil Application no. 3754/85. The petitioners who were contractors have prayed for a declaration that the provisions of Section 10 of the Contract labour (Regulation and Abolition) Act, 1970, are ultra vires Articles 14 and 19 of the Constitution of India. It was submitted by Mr. M. B. Buch, learned advocate appearing on behalf of Mr. K. S. Nanavati for the petitioners that any prohibition imposed by notification issued under Section 10 would result in snapping of the contract between the principal employer and the contractor, as well as between the contractors and the employees that it would interfere with the internal working of the processing units and it would require principal employers to engage regular employees which would result in imposition of additional financial burden, and as such on the whole it would not be for the benefit of the employees, as indirectly it would result in unemployment. Thus, according to Mr.
Thus, according to Mr. M. B. Buch the notification issued under Section 10 of the Act directly affected the fundamental right of the processing units as well as the contractors to carry on their business freely and without unreasonable restriction, and it would be directly violative of Artilce 19 of the Constitution of India. It was also submitted that Section 10 which does not provide for any hearing to the affected party, was violative of article 14 also. Section 10 of the Act reads as under:"10. Prohibition of employment of contract labour.- (1) Notwithstanding anything contained in this Act, the appropriate Government may, after consultation with the Central Board, or, as the case may be, a State Board, prohibit, by notification in the Official gazette, employment of contract labour in any process, operation or other work in any establishment. (2) Before issuing any notification under sub-section (1) in relation to an establishment, the appropriate government shall have regard to the conditions of work and benefits provided for the contract labour in that establishment and other relevant factors, such as (a) whether the process, operation or other work is incindental to, or necessary for the industry, trade, business, manufacture or occupation that is carried on in the establishment; (b) whether it is of perennial nature, that is to say, it is of sufficient duration having regard to the nature of industry, trade, business, manufacture or occupation carried on in that establishment; (c) whether it is done ordinarily through regular workmen in that establishment or an establishment similar thereto; (d) whether it is sufficient to employ considerable number of wholetime workmen. Explanation: If a question arises whether any process or operation or other work is of perennial nature, the decision of the appropriate Government thereon shall be final. "6. B. The question of constitutional validity of Section 10 should not engage our attention any more in view of the judgment of the Supreme Court in M/s. Gammon India Ltd. v. Union of India and others reported in AIR 1974 S. C. 960.
"6. B. The question of constitutional validity of Section 10 should not engage our attention any more in view of the judgment of the Supreme Court in M/s. Gammon India Ltd. v. Union of India and others reported in AIR 1974 S. C. 960. The Supreme Court examined the question whether the provisions of the act amounted to unreasonable restriction on the right of the contractors under article 19 (l) (g) of the Constitution, and it also examined the Rules relating to certain welfare measures enacted for the benefit of the employees, and it was held that there was no violation of Article 14 also. The Supreme Court observed that the underlying policy of the Act is to abolish the contract labour wherever possible and practicable, and where it cannot be abolished altogether, the policy of the Act is that the working conditions of the contract labour should be so regulated as to ensure payment of wages and provision of essential amenities. The supreme Court stated in terms that the dominant idea of Section 10 of the Act is to find out whether contract labour is necessary for the industry, trade, business and manufacture which is carried on in the establishment. Though the scheme of Section 10 was not examined in details the Supreme Court repelled the challenge to the constitutional validity of the entire Act. It is, therefore, not open to the petitioners in Spl. C. A. No. 3754/85 to challenge the vires of section 10 of the Act. 6. C. In Smt. Somavanti and Others v. The State of Punjab and Others, 1963 s. C. 151, Mudholkar, J. speaking for the majority observed in Para 22 that: "the binding effect of a decision does not depend upon whether the particular argument was considered therein or not, provided that the point with reference to which an argument was subsequently advanced was actually decided. " These observations were made in the context of the challenge to the provisions of the land Acquisition Act 1894. 6. D. This judgment was followed by a Division Bench of the Gujarat High court in Murtujakhan Joravarkhan Babi v. Municipal Corporation of Ahmedabad, (1975) 16 G. L. R. 806 in the context of the vires of the Bombay Town Planning act, 1954.
6. D. This judgment was followed by a Division Bench of the Gujarat High court in Murtujakhan Joravarkhan Babi v. Municipal Corporation of Ahmedabad, (1975) 16 G. L. R. 806 in the context of the vires of the Bombay Town Planning act, 1954. The Constitutional validity of the provisions of the Bombay Town planning Act had already been upheld in three Supreme Court Judgments, namely, (l5 Maneklal Chhotalal v. N. J. Makwana, 1967 S. C. 1373; (2) N. L. Gupta v. Corporation of Greater Bombay, 1968 S. C. 303 and (3) State of Gujarat v. Shantilal, 1969 S. C. 634. However, in murtujkhans case it was contended before the Division Bench that in none of the abovementioned cases the court was called upon to determine the validity of Section 64 of the Bombay Town planning Act on the ground that it was ultra vires Article 19 (l) (g ). The Division bench held that "once the validity of the Act as a whole has been upheld after considering the various provisions of the act, and taking into account both procedural and substantive aspects it cannot possibly be urged that the validity of a particular section is still open to challenge because it has not been specifically considered. "6. E. Since the Supreme Court has already examined the constitutional validity of the entire Act and held that there was no violation of Article 14 or 19 at all in any provision of the Act, the challenge to Section 10 must fail in this petition also. As the Preamble of the act shows the purpose of the Act is to regulate the employment of contract labour in certain establishments and to provide for its abolition in certain circumstances. It also appears from the statement of objects and reasons that the system of employment of contract labour lands itself to various abuses and the general consensus of opinion was that the system should be abolished wherever possible and practicable and that in cases where this system could not be abolished altogether, the working conditions of the contract labour should be regulated so as to ensure payment of wages and provision of essential amenities. As a result the Act came into existence. We will have to examine the various submissions made by the learned Counsel for the petitioners by keeping this background in mind.
As a result the Act came into existence. We will have to examine the various submissions made by the learned Counsel for the petitioners by keeping this background in mind. ( 7 ) SO far as the impugned notification dated 11-3-1985 and 26th May 1989 are concerned, the following submissions were made on behalf of the petitioners: (I) Section 10 of the Act does not contemplate abolition of contract labour in several establishments, and the power conferred on the appropriate Government has to be exercised in respect of each individual establishment. If, therefore, notification is issued prohibiting contract labour in certain processes in a large number of establishments either in Surat or in the remaining part of the State, such a notification would be ultra vires section 10. (II) The Advisory Board was not properly constituted since it did not consist of 11 members as required under sub-section (2) of Section 4 of the Act. This contention was, however, given up by the learned Counsel after referring to the report of the Advisory Board, and realising that the Advisory Board consisted of the Chairman, Deputy labour Commissioner, Deputy Secretary to Government, and the required number of representatives of the Textile Industry, employees Associations, and contractors, and that all the 11 members had participated in the working and deliberations of the Board and had signed the report. Thus the requirements of sub-section (2) of Section 4 of the Act were satisfied. (III) The notification had been issued by the State Government without affording any opportunity of hearing to the interested parties, and so the breach of principles of natural justice would render the notification ab initio void. (IV) There was also violation of the" fundamental right of equality guaranteed under Article 14 of the Constitution in view of the fact that unequal establishments either big or small, either employing labourers perennially or temporarily, were treated as equal, and moreover there was no prohibition on contract labour outside the State of gujarat. (V) The notification dated 11th March 1985, was vague as it purported to cover the city of Surat, and "neighbouring areas", and the subsequent notification which covered the entire State of Gujarat was outside the scope of reference to the advisory Board which was confined to the areas of Bulsar, Bharuch, Navsari, ahmedabad and Jetpur, and the like areas.
(V) The notification dated 11th March 1985, was vague as it purported to cover the city of Surat, and "neighbouring areas", and the subsequent notification which covered the entire State of Gujarat was outside the scope of reference to the advisory Board which was confined to the areas of Bulsar, Bharuch, Navsari, ahmedabad and Jetpur, and the like areas. ( 8 ) A. So far as the first submission is concerned, Mr. A. H. Mehta, appearing for the petitioners in Special Civil applications No. 8851/89 and 2512/85 laid emphasis on the phrase "in any establishment" appearing in sub-section (1) of Section 10, and also on the phrase "in relation to an establishment" and "in that establishment" occurring in sub-section (2) and submitted that the appropriate Government can exercise the power to prohibit the employment of contract labour in any of the specified processes in any one establishment and there cannot be a general prohibition embracing several establishments. This submission is stated merely to be rejected for the simple reason that in any statute or rule the use of a singular term would also include plural, and there is a notification which would cover more than one establishments if they are similar in their work and functions. Since the appropriate Government is enjoined to have regard to the conditions of work and benefits provided for the contract labour in a particular establishment, it would certainly have regard to conditions of work and benefits provided for the contract labour in other establishments also if they are of similar nature, and that is why, the Advisory Board was constituted. It can never be stated that separate notifications have necessarily to be issued for separate establishments. 8. B. In J. P. Gupta and Another v. Union of India and Others, 1981 L. I. C. 641 a similar argument was advanced before the patna High Court and it was held by the High Court that a notification covering different coal mines could not be declared to be invalid, and on examining the provisions of the Act in its proper context, a single notification could be issued in respect of different establishments if operation and nature of work were similar in all the establishments.
A Division bench of the Orissa High Court also endorsed this view in M/s. Zenith industrial Services and two Others v. Union of India and two Others, reported in 1990 (1) L. L. J. 38. Similarly in Dalmia cement (Bharat) Ltd. Tiruchirapalli district v. Government of India and another, reported in (1991) 1 L. L. N. 406, the Division Bench of the Madras High court refused to entertain the challenge to a notification under Section 10 of the act on the ground that such a notification can only be establishment-wise and a general notification was not proper compliance with the provisions of the Act. ( 9 ) A. Realising that such a submission would not hold water in view of the reported decisions, Mr. Mehta submitted that even if a notification covers different establishments, it cannot operate in respect of such establishments as are not given opportunity of hearing Now this submission goes to the root of the matter, and the main thrust of Mr. Mehtas submission is that a notification issued by the Government without hearing all the concerned parties, and only by treating all the establishments as similar and equal would be violative of the principles of natural justice and, therefore, void and ultra vires Article 14. The submission in short is that the issuance of notification under Section 10 of the Act is really an administrative act on the part of the State Government, and even if it is considered as a legislative step, it does partake the character of administrative functioning and, therefore, the requirement of fair treatment and prior hearing would be a necessary prerequisite. 19-10-1993:9. B. According to Mr. Mehta, the provision in sub-section (2) requiring the government to have regard to the conditions of work and benefits provided for the contract labour in the establishment and other relevant factors, indicates that the particular establishment is required to be heard before taking any decision and such a hearing would be almost a quasi-judicial function. Thus according to Mr. Mehta, even if a single notification is issued for several establishments, it can cover only those which have been given an opportunity of hearing. 9. C. Mr. A. K. Clerk, appearing for the respective Workers Union in the three petitions and Mr.
Thus according to Mr. Mehta, even if a single notification is issued for several establishments, it can cover only those which have been given an opportunity of hearing. 9. C. Mr. A. K. Clerk, appearing for the respective Workers Union in the three petitions and Mr. Girish Patel, appearing as an intervener, on the other hand submitted that the action of the government in issuing the notification under Section 10 of the Act was purely a legislative action. They submitted that a legislative action differs from an administrative action of the Government or its officer, in several respects, since a legislative decision requires to be published in official gazette, it is final in all respects and not possible of challenge in appeal, it operates by its projection in future since it is declaratory and prohibitory in nature, and it applies to several units of one similar category. These characteristics would be conspicuous by their absence, in an administrative or quasi-judicial act which is incomplete without a pre-decisional hearing. They also submitted that the jurisdiction to prohibit or abolish contract labour in any establishment was formerly exrcised by the Industrial Tribunal in individual cases by a quasi-judicial process, and the very fact that it is taken away from the purview of industrial court and vested in the Government under section 10 of the Act shows that the power exercised by the Government under Section 10 is of legislative character which would not require any predecisional hearing of the concerned parties. ( 10 ) A. A number of judgments have been cited by the Counsel on both the sides and as these judgments would indicate the purpose, scope and scheme of the enactment, we would deal with them in chronological order: (I) In Chandra Bhawan Boarding and lodging, Bangalore v. State of Mysore and Another, 1970 S. C. 2042 the Supreme court was concerned with the validity of the notification issued by the government of Mysore fixing the minimum wages of different classes of employees in residential Hotels and eating Houses in the State of Mysore under the Minimum Wages Act, 1948.
Even though the notification was issued without appointing a committee consisting of representatives of the employers and employees who would be aware about the ground realities prevailing in the hotels and eating houses in the State of Mysore, the Supreme Court held that the power to fix minimum wages given to the Government was not administrative or quasi-judicial and so the order fixing different minimum wages for different industries or different localities was not vitiated by failure to constitute a committee under the relevant provision of the Act since reasonable opportunity had been given to the concerned parties before taking a decision. It was observed that the dividing line between administrative power and quasi-judicial power is quite thin and is being gradually obliterated. The Supreme Court without ultimately deciding the applicability of the principles of natural justice to the facts of the case held that the impugned order could not be said to be vitiated in view of the objective behind the Act, the purposes intended to be achieved and the high authority on whom the power was conferred and procedure that had been adopted. (II) After the Contract Labour (Regulation and Abolition) Act, 1970, came into existence, the Supreme Court examined the scheme of the act, and particularly Section 10 in the case reported in Vegoils Pvt. Ltd. v. Workmen, 1972 S. C. (Para 31), the Supreme Court culled out the following points as emerging from Section 10 (1) :1. "section 10 (l ). The appropriate government has power to prohibit the employment of contract labour in any process, operation or other work in any establishment; (2) Before issuing a notification prohibiting contract labour the appropriate Government has to consult the Central or State Board, as the case may be, which we have already pointed out, comprises of the representatives of workmen, contract and the industry; (3) Before issuing any notification under sub-section (1) prohibiting the employment of contract labour, the appropriate Government is bound to have regard not only to the conditions of work and benefits provided for the contract labour, in a particular establishment, but also other relevant factors enumerated in clauses (n) to (d) of sub-section (2); and (4) Under the explanation which really relates to clause (b) the decision of the appropriate government on the question whether any process, operation, or other work is of perennial nature shall be final.
" (III) In Rameshchandra Kachardas porwal and Others v. State of maharashtra and Ors. 1981 S. C. 1127, the supreme Court examined the provisions of the Maharashtra Agricultutal Produce marketing (Regulation) Act, 1964, in order to determine whether the notification issued under the relevant provisions of the Act was ultra vires. The reluctant traders who were unwilling to move their places of business into the market Yard challenged the notification indicating the area of the market yard and the consequential notice requiring the traders to carry on business in the market yard and at no other place. As the provisions of the Act relating to agricultural Produce Markets and Market yards in different States roughly followed the same pattern the Supreme Court referred to the cases under the Bihar agricultural Produce Market Yard and considered the submission to the effect that it was the duty of the concerned authority to invite and hear objections when the Market Yard was going to be de-established at " one place and established in another place, even though the Supreme Court found itself unable to agree with such a submission. It was observed: "we are here not concerned with the exercise of the judicial or quasi-judicial function where the very nature of the function involves the application of the rules of natural justice, or of an administrative function affecting the rights of persons, wherefore, a duty to act fairly. We are concerned with legislative activity; we are concerned with the making of a legislative instrument, the declaration by notification of the government that a certain place shall be a principal market yard for a market area, -upon which declaration certain statutory provisions, at once spring into action and certain consequences prescribed by statute follow forthwith. The making of the declaration in the context, is certainly an act legislative in character and does not oblige the observance of the rules of natural justice. "the Supreme Court quoted with approval the statement of law made by prof. H. W. R. Wades in his administrative Law (4th Edn.): "there is no right to be heard before the making of legislation, whether primary or delegated, unless it is provided by statutes. " (IV) In Indian Express Newspapers (Bombay) Pvt. Ltd. and Ors. v. Union of india and Ors.
H. W. R. Wades in his administrative Law (4th Edn.): "there is no right to be heard before the making of legislation, whether primary or delegated, unless it is provided by statutes. " (IV) In Indian Express Newspapers (Bombay) Pvt. Ltd. and Ors. v. Union of india and Ors. 1985 (1) S. C. C. 649, while dealing with the challenge by certain companies engaged in the business of printing and publishing newspapers, periodicals and magazines, to the validity of the imposition of import duty on newsprints, imported from abroad under section 12 of the Customs Act, 1962, and also the levy of Auxiliary duty under the finance Act, 1981, and also while dealing with the notification of exemption issued under Section 25 (1) of the Customs Act, the Supreme Court held that subordinate legislation cannot be questioned on the ground of violation of natural justice which is available against an administrative action though it may be questioned on any of the grounds on which plenary legislation is questioned. The subordinate legislation may be struck down as arbitrary or contrary to the statute if it failed to take into account the vital facts which either expressly or by necessary implication are required to be taken into consideration by the Statute or Constitution. (V) The Supreme Court again examined the scheme and provisions of the Act in some petitions filed by Bharat Heavy electricals Ltd. Workers Union and Ors. for a declaration that the system of contract labour under which they were working was illegal and that they were direct employees of the B. H. E. L. and they were entitled to equal pay as the workmen of the said Company. The judgment is reported in A. I. R. 1985 S. C. 409 (B. H. L. Workers Association, Hardwar and others v. Union of India and Others ). The Supreme Court expressed its inability to grant such declaration and to impliedly issue a writ to abolish the employment of contract labour. It was specifically held :"we are afraid that, that would be nothing but the exercise of legislative activity with which function the Court is not entrusted by the Constitution.
The Supreme Court expressed its inability to grant such declaration and to impliedly issue a writ to abolish the employment of contract labour. It was specifically held :"we are afraid that, that would be nothing but the exercise of legislative activity with which function the Court is not entrusted by the Constitution. " It was further observed in para 6: "it is not for the Court to inquire into the question and to decide whether the employment of contract labour in any process, operation or other work in any establishment should be abolished or not. This is a matter for the decision of the government after considering the matters required to be considered under Section 10 of the Act. "thus the decision of the Government reflected in the notification is clearly the result of quasi-legislative activity and as such it does not attract any requirement of previous notice or hearing. (VI) In Transport Dock Workers Union and Ors. v. Food Corporation of India and Another, 1986 (2), L. I. C. 1393, the bombay High Court considered the submission made on behalf of the petitioners Workers Union to the effect that having regard to the consequence ensuing from the issue of exemption notification under the Bombay Shops and establishment Act, the State Government was under an obligation to give workmen an opportunity to show cause against the exemption sought by the Food corporation of India. After examining the language of Section 4 of the Bombay shops and Establishment Act, and some judgment of the Supreme Court and madras High Court, the Bombay High court concluded that the principle of notice and hearing preceding law-making is just not contemplated by our system of jurisprudence. It was further observed that even administratively, it cannot be accepted that all parties likely to be affected by a legislation should be heard by the legislative body, before it makes up its mind about the nature and character of the legislation proposed to be held.
It was further observed that even administratively, it cannot be accepted that all parties likely to be affected by a legislation should be heard by the legislative body, before it makes up its mind about the nature and character of the legislation proposed to be held. (VII) Similarly in Catering Cleaners of southern Railway v. Union of India and another, 1987 S. C. 777, the Supreme Court was satisfied on the facts and on the report of the Parliamentary Committee on the question of employing Catering cleaners that the work of cleaning catering establishments and pantry care was necessary and incidental to, the business of Southern Railway and so requirement (a) of Section 10 (2) was satisfied; that it was of a perennial nature, and so requirement (b) was satisfied; that the work was done through regular workmen in most of the Railways in the country and so requirement (c) was satisfied and that the work requires the employment of sufficient number of whole-time workmen and so requirement (d) was also satisfied. Thus all the relevant factors mentioned in Section 10 (2) appeared to be satisfactorily accounted for. Even then in view of the power vested in the appropriate Government under Section 10 to prohibit the employment of contract labour, the Supreme Court refrained from straightway issuing a mandamus but directed the Central Government to take appropriate action within six months. (VIII) In the Union of India and Another v. Cynamide India Ltd. and Another, etc. 1987 S. C. 1802, the Supreme Court had an occasion to examine the validity of the notification issued by the Central government fixing the minimum price of indigenously manufactured bulk drugs under the Drugs (Price Control) Order, 1979. It was held that fixation of maximum price was a legislative action, and the only thing which could be examined by the court was whether relevant considerations had gone in, and irrelevant consideration kept out of determination of the purview.
It was held that fixation of maximum price was a legislative action, and the only thing which could be examined by the court was whether relevant considerations had gone in, and irrelevant consideration kept out of determination of the purview. It was observed that legislative action plenary or subordinate is not subject to rules of natural justice, and that nothing in the scheme of the Drugs (Price Control) order induced one to hold that price fixation was not a legislative activity, but quasi-judicial activity which would attract the observance of the principles of natural justice, nor is there anything in the scheme or in the provisions of the Drugs (Price Control) Order which otherwise contemplates, the observance of any principles of natural justice. It contemplates only "such inquiry" by government as it thinks fit. The Supreme court held that the inquiry contemplated under the Drugs (Price Control) Order was of a legislative character and such legislative activity must comply with the statutory conditions; but it would not be void on account of non-compliance with the principles of natural justice. (IX) The position was again discussed by the Supreme Court in State of U. P. and Others v. Renusagar Power Co. and others, 1988, S. C. 1737. After referring to the judgment in Cynamide India Ltd. (supra) the Supreme Court observed that administrative and quasi-judicial decisions tend to merge into legislative activity and conversely the legislative activity tends to fade into and present an appearance of an administrative or quasi-judicial activity. It was held that sub-section (4) of Section 3 of the U. P. Electricity (Duty) Act, 1952, under which the State Government had power to fix the rates and to grant exemption was quasi-legislative and quasi-administrative in so far as it had power to fix different rates having regard to certain factors and in so far as it had power to grant exemption in some cases. It was further held that when the power is exercised with reference to any class it would be in the nature of subordinate legislation, but when the power is exercised with reference to individual, it would be administrative.
It was further held that when the power is exercised with reference to any class it would be in the nature of subordinate legislation, but when the power is exercised with reference to individual, it would be administrative. It as further held that natural justice in the sense that party must be heard before hand need not be directly followed in fixing the price, and non-supply of the report did not make the order of the State Government vulnerable to challenge, (X) Similarly in H. S. S. K. Niyami and another v. Union of India and Another, (1990) 4 S. C. C. 516, the Supreme Court dismissed the challenge to the notices issued by the Government of India for the purpose of fixing prices in exercise of powers conferred under sub-rule (2) of Rule 125 of the Defence of India Rules, 1962, and Clause 6 of Sugar (Control) order, 1963, issued under Section 3 (3-C) of the Essential Commodities Act, 1955. The question before the Supreme Court was whether the appellants- factory-owners were entitled to individual notices or representation and hearing before placing them in a particular zone. The Supreme Court held that the government decision assumed the character of legislative policy and no individual factory was entitled to representation and notice of hearing before placing a particular factory or factories in a particular zone. Since the sugar Commission had already heard the persons desired to be heard and had considered the representation and material produced at the stage of notice the question of further representation or hearing did not arise, nor it could be considered a feasible exercise, and such an order of the Government would not be subject to judicial review Similar was the view expressed by the Supreme Court regarding the Government decision to fix the price of levy sugar and grouping the sugar factories on the basis of their geographical location. In the judgment in m/s. Shri Sitaram Sugar Co. Ltd. and another v. Union of India and Others, 1990 S. C. 1277, it was held that fixation of price of levy sugar by Government was in the nature of legislative action, even when it was based on objective criteria founded on relevant material, and no rule of natural justice was applicable to any such order.
Ltd. and another v. Union of India and Others, 1990 S. C. 1277, it was held that fixation of price of levy sugar by Government was in the nature of legislative action, even when it was based on objective criteria founded on relevant material, and no rule of natural justice was applicable to any such order. It was further observed that the words "having regard to" in the sub-section were indicative of legislative instructions for the general guidance of the Government in determining the price of sugar, and they were not mandatory, but in a sense directoty. (XI) The Division Bench of the Madras high Court had to examine the validity of the notice issued by the Central government in exercise of the powers conferred by sub-Section (1) of Section 10 of the Act after consultation with the central Board prohibiting employment of contract labour in certain works in Dalmia cement (Bharat) Ltd. , Tiruchirapalli district, and Government of India (represented by Secretary, Ministry of labour and Rahabilitation), New Delhi, and Another, (1991)1 L. L. N. 406. While upholding the validity of the nofitication, the court held that the exercise of power contemplated under Section 10 partakes the character of legislative activity, and more in the nature of a delegated or conditional legislation than passing any order in exercise of any quasi-judicial or administrative power affecting individual rights of parties. Thus the powers exercised under Section 10 (1) were held to be quasi-legislative, which would lay down general rule applicable to all persons or objects in contra-distinction to a quashi-judicial measure concerning individuals. It was observed: "suffice it to indicate at this stage that such findings and conclusions being matters of policy, the scope of judicial review is limited and Courts do not supplement or substitute their judgment for that of the Legislature or its nominee in respect of matters which are within their purview. Judicial enquiry in such cases is confined to the question whether the findings of fact were reasonably based upon evidence and whether the findings of conclusions are consistent with an overall and broad-based consideration by the Government of the factors mentioned in Section 1q. Judicial function in respect of such matters have been invariably held to be exhausted when a rational basis or reasonable nexus has been found of the conclusions with the materials available and the guidelines and formula postulated under the Act.
Judicial function in respect of such matters have been invariably held to be exhausted when a rational basis or reasonable nexus has been found of the conclusions with the materials available and the guidelines and formula postulated under the Act. "we are in agreement with the Madras high Court so far as the principles enunciated hereinabove are concerned. ( 11 ) WE, therefore, examine the impugned Notifications with reference to the language of Section 10 of the Act, and also the requirements envisaged by the Supreme Court in Vegoils Pvt. Ltd. , 1972 S. C. 1942: (1) Section 10 (1) gives the power to appropriate Government to prohibit the employment of contract labour in any processes in any establishment. (2) The State Government constituted a State Advisory Contract Labour Board to advise it in the matter arising out of the administrative act, and it consisted of: (a) A. Retired High Court Judge, appointed as a Chairman; (b) Deputy Commissioner of Labour, and Deputy Secretary, Irrigation department; (c) As well as representatives of the textile Industries, contractors employing labour in such industries, and the workmen. Thus, the State Board consisting of 11 members was truly representative in character as envisaged in sub-Section (2) of Section 4 of the act. (3) The State Board submitted its report after issuing notices to various units likely to be affected as a result of prohibition of contract labour, and called for Pro forma information. The information was also called for from the contractors and Unions of Workmen. Meetings of the Board were held and attended by interested parties, and the board Members also inspected certain factories. The Board was of the opinion that the activities of bleaohing, finishing and dyeing and printing were of perennial nature and that they used to be carried on ordinarily through regular workmen before the year 1973. The members of the Board were unanimous in their opinion that it was a fit case for abolition of contract labour system in the establishments in the city of Surat and in the neighbouring areas. So far as the remaining areas of the State of Gujarat are concerned, the majority opinion was in favour of abolition of contract labour. It was found by the Board that the system of employing contract labour was adopted as a counter measure in view of the strike observed by some unorganised labour and unapproved Unions.
So far as the remaining areas of the State of Gujarat are concerned, the majority opinion was in favour of abolition of contract labour. It was found by the Board that the system of employing contract labour was adopted as a counter measure in view of the strike observed by some unorganised labour and unapproved Unions. (4) Having considered the report of the state Board the State Government also took into consideration the conditions of work and benefits provided for the contract labour, and also the relevant factors enumerated in sub-Section (2) of section 10, namely, whether the process in which contract labour used to be employed was incidental to or necessary for the industry; whether it was of a perennial nature; whether it was done ordinarily through regular workmen; and whether it was sufficient to employ considerable number of whole-time workers. On these four relevant aspects the appropriate Government agreed with the report of the Advisory Board and the decision of the Government became final on those points. (5) Thus after consultation with the state Advisory Board, and after considering the relevant factors enumerated in sub-Section (2) of Section 10, the Government issued the impugned notifications prohibiting contract labour in the aforesaid four processes. The action of issuing the impugned notifications was strictly within the four corners and requirements of Section 10, and so it was beyond the pale of challenge, nor it could be challenged on the ground of non-compliance with the principles of natural justice, it being the result of quasi-legislative action. Even if such an action be described as quasi-judicial action, it has come on record that all the interested parties involved in the industry, namely, the factory owners, contractors and employees, were given sufficient opportunity to submit their say and viewpoints before the Advisory board, and the Advisory Board had taken those submissions and considerations into account. It can certainly be said that a fair treatment was given to all concerned and the use of a particular nomenclature would not make any difference so far as the validity of the ultimate decision of the Government is concerned. We find that the power conferred under Section 10 of the Act is essentially quasi-legislative in character and it was exercised in the instant case within the limits of the statutory provisions, and so the question of affording an opportunity of hearing would not strictly arise.
We find that the power conferred under Section 10 of the Act is essentially quasi-legislative in character and it was exercised in the instant case within the limits of the statutory provisions, and so the question of affording an opportunity of hearing would not strictly arise. Even if such power is regarded as quasi-judicial in character, all the concerned interests were heard by the Board and the notification was issued by the appropriate government after considering and accepting the report of the independent advisory Body representing ,the concerned interests and presided over by a high judicial entity, and after also considering the relevant facts indicated in sub-Section (2 ). We, therefore, hold that the impugned notifications are not vulnerable to any challenge. ( 12 ) SO far as the fourth submission made by the learned Counsel for the petitioners is concerned, it would be futile t,o say that different unequal establishments may be big or small, but there is great similarity in the employment of contract labour and the functioning of the establishment, which was taken into consideration by the Advisory Board. Similarly there is no merit in the submission that a notification issued by the State of Gujarat, would be violative of Article 14 of the constitution, if no such prohibition is enacted in other parts of the country. Since issuance of notification is a legislative action, it is for the Legislature to decide which action is necessary in a particular local area. As was observed by the Supreme Court in Prabhakaran nair, etc. v. State of Tamil Nadu and others, 1987, S. C. 2117, Article 14 of the constitution does not authorise the striking down of a law of one State on the ground that in comparison with the law of another State on the same subject its provisions are discriminatory; nor does it contemplate a law of the Centre or of the State dealing with similar subject being held to be unconstitutional by process of comparative study of the provisions of two enactments. If there are any considerations for enacting a particular measure, or abolishing a particular system if found pernicious, in a particular local area or establishments, it is not for the Court to sit in judgment over the action of the legislative body, unless such action is patently ultra vires the Constitution or the Statute.
If there are any considerations for enacting a particular measure, or abolishing a particular system if found pernicious, in a particular local area or establishments, it is not for the Court to sit in judgment over the action of the legislative body, unless such action is patently ultra vires the Constitution or the Statute. ( 13 ) A. Lastly it was submitted that the earlier notification dated 11th March 1985, was vague inasmuch as it prohibited the employment of contract labour in Surat distinct and its surrounding areas. This notification cannot be said to be vague in view of the fact that the Advisory boards report pointedly refers to the "neighbouring areas" as Bulsar and navsari. The geographical fact is that bulsar and Navsari are neighbouring areas so far as the city of Surat is concerned. All concerned were aware about the meaning of the term "neighbouring areas", since the meeting of the Board held on 25-9-81 at Surat was attended amongst others by Navsari audhyogik Mazdoor Sabha and Navsari and Bulsar Art Silk Labour Union. It, therefore, cannot be said that the earlier notification dated 11-3-85 would be void and ineffective because of the aforesaid vagueness. 13. B. It was also submitted that the subsequent notification dated 26th May 1989, which prohibits the employment of contract labour in Art Silk Textile Process units throughout the State of Gujarat was outside the scope of reference to this advisory Board. Since as per affidavit-in-reply filed on behalf of the state Government, reference was made to the Board in respect of Art Silk Textile process Units in the areas of Bulsar, bharuch, Navsari, Ahmedabad, Jetpur and the like areas. Thus, according to the learned Counsel appearing for the petitioners no reference had been made in respect of the remaining parts of the state of Gujarat, and the decision of the government in prohibiting contract labour throughout the State of Gujarat would not be warranted by the scheme of Section 10. In the further affidavit-in-reply Shri V. R. Rana, Under secretary to the Government, Labour and employment Department, has pointed out that the reference was actually made for the whole State and not only for the specified areas. The notices calling upon the relevant establishments to furnish information were sent to those establishments carrying on such process.
In the further affidavit-in-reply Shri V. R. Rana, Under secretary to the Government, Labour and employment Department, has pointed out that the reference was actually made for the whole State and not only for the specified areas. The notices calling upon the relevant establishments to furnish information were sent to those establishments carrying on such process. After due deliberation and consideration of various relevant aspects the government had taken a decision to issue the impugned notification dated 26th May 1989. A careful reading of the reference dated 11th March 1985, made by the government to the Secretary of the advisory Board, it appears that the reference was made to all the areas of the State of Gujarat which were not covered by the earlier reference, and the areas of Bulsar, Bharuch, Ankleshwar, ahmedabad and Jetpur were only cited as instances. Irrespective of the question whether the subequent reference covers the entire State of Gujarat, it would also be necessary to take notice of the fact indicated by the General Secretary of the workers Union in its affidavit-in-reply in Spl. C. A. No. 8851/89 indicating that bulsar, Bharuch Ankleshwar, Ahmedabad and Jetpur were the only areas within the State of Gujarat where Art Silk Textile process Units which were not covered by the earlier notification were situated. In fact, this contention was not at all open to the petitioners. South Gujarat textile Processors Association and Other industries were already covered by the earlier notification. These were the only contentions urged on behalf of the petitioners in these three petitions. No other point was urged. The contract Labour (Regulation And abolition) Act, is obviously a social welfare legislation and as observed by the supreme Court in Ministry of Labour and rehabilitation and Another v. Tiffins barytes Asbestos and Paints Ltd. and another, 1985 S. C. 1391 any action taken pursuant to such legislation cannot be struck down on mere technicalities and the notification issued under the relevant provisions of the Act cannot be lightly interfered with under Article 226 of the constitution of India on the ground of a few insignificant irregularities in the constitution of a Board or in the procedure adopted by it. ( 14 ) IN the result, we do not find any merit in any of the petitions and, therefore, dismiss the same. Rule is discharged in each petition and interim relief would stand vacated.
( 14 ) IN the result, we do not find any merit in any of the petitions and, therefore, dismiss the same. Rule is discharged in each petition and interim relief would stand vacated. There will be no order as to costs. At this stage the learned Counsel appearing for the petitioners in Spl. C. A. No. 8851/89 and Spl. C. A. No. 2512/85 applies for a certificate under Article 134-A of the Constitution of India. We reject the prayer since the case does not involve a substantial question of law of general importance which requires to be decided by the Supreme Court. .