Management of Vishnu Sugar Mills
Limited, Harkhua, District V. Their Workmen Represented By Chini Mill Mazdoor
Union,Hark  INSC 39 (9 March 1960)
CITATION: 1960 AIR 812 1960 SCR (3) 214
Industrial Dispute-Reference by State
Government-Competence- Controlled industry-"Appropriate Government,"
meaning of- Industries (Development and Regulation) Act, 1951 (65 of 1951).
-Industrial Disputes Act, 1947 (14 Of 1947), S. 2 (a) (i).
A dispute relating to a workman in the
appellant sugar mill, situate in Bihar, was raised by the Workers Union and a
reference was made by the State Government. Under s. 2 (a) (1) of the Industrial
Disputes Act, 1947, "'Appropriate Government' means in relation to any
industrial dispute concerning any industry carried on by or under the authority
of the Central Government...... or concerning any such controlled industry as
may be specified in this behalf by the Central Government...... the Central
Government ". The question was whether the State Government was competent
to make the reference, as sugar was a controlled industry under the Industries
(Development and Regulation) Act, 1951.
Held, that in order that the appropriate
government under s. 2 (a) (1) of the Industrial Disputes Act, 1947, may be the
Central Government for a controlled industry it is necessary that such
controlled industry should be specified by the Central Government, and that in
the absence of a notification for the 215 purposes of s. 2 (a) (1) of the Act,
the State Government was competent to make the reference.
The Bijoy Colton Mills Ltd. v. Their Workmen
and Another  2 S.C.R. 982, followed.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 402 of 1958.
Appeal by special leave from the Award dated
January 29, 1957, of the Industrial Tribunal, Bihar, at Patna in Reference No.
7 of 1956.
Sukumar Ghose, for the appellant.
M. K. Ramamurthi, R. K. Garg, A. N. Nag and
Suresh Aggarwal, for the respondents.
S. P. Varma, for the intervener (State of
1960. March 9. The Judgment of the Court was
delivered by WANCHOO, J.-This is an appeal by special leave against the award
of the Industrial Tribunal, Patna. The appellant is a Sugar Mill in District
Saran in the State of Bihar. One Ramkrishna Prasad was appointed as clerk in
this mill in 1933. Gradually, he worked his way up and was drawing Rs. 140 per
month in October 1952. The mill created a new post of store in-charge about
that time as the work in the Stores Department of the Mill had increased. On
October 4, 1952, Babulal Parekh was appointed to this new post on a
consolidated salary of Rs. 180 per menses. A letter of appointment was issued
to him on that date and he was told that he would be on probation for one year.
He was also asked by another letter to take charge immediately. He took charge
on October 7, 1952. On November 28, 1952, an order was passed by the mill
distributing the duties between the various clerks employed in the Stores
Department and it was stated therein that all the staff of the Stores
Department would work as subordinate to Babulal Parekh. On December 2, 1952, another
order was passed by which Ramkrishna Prasad was ordered to hand over the keys
of the stores to Babulal Parekh. Thereafter Ramkrishna Prasad made a
representation against his being made subordinate to the stores in-charge.
This representation was rejected. A dispute
was then raised by the union and a reference was made by the Government of
Bihar on May 9, 1956, in which the 216 following three matters were referred to
the tribunal:- 1.Whether the status of workman, Sri Ramkrishna Prasad,
Store-keeper, and the nature of the job performed by him has been changed to
his prejudice with the appointment of a separate store in charge;
2.Whether in view of the satisfactory
performance of duties of store-keeper for the last 20 years by the above- named
workman, it was at all necessary to appoint a separate store in-charge over him
with higher emoluments and whether Shri Ramkrishna Prasad is entitled to be
appointed to the post of store in-charge; and 3.Whether the claim of the
above-named workman for promotion to higher grades has been overlooked by the
management, and if so, what relief the workman is entitled to.
When the matter came up before the tribunal,
the main contention on behalf of the mill was that it was exclusively the
management function to decide its labour strength, both qualitatively and
quantitatively, and that so far as Ramkrishna Prasad was concerned his position
had not been prejudicially affected by the creation of the new post of a store
in-charge. The workmen on the other hand contended that Babulal Parekh was
first appointed as a mere clerk under Ramkrishna Prasad to begin with and it
was only on November 28, 1952, that he was promoted over the head of Ramkrishna
Prasad as a store in-charge, thus superseding Ramkrishna Prasad. This stand of
the workmen was controverted by the mill and its case was that Babulal Parekh
was from the very beginning appointed as store in- charge.
The tribunal came to the conclusion after a
consideration of the evidence produced that Babulal was first appointed as an
ordinary clerk in the Stores Department and was subsequently made a store
incharge. It held that this caused reasonable heart burning to Ramkrishna
Prasad. The tribunal was conscious of the principle that promotion to a higher
post was the exclusive function of the management and should not ordinarily be
interfered with. But 217 in spite of that it was of the view that this was a
fit case for interference; but on other considerations which were not specified
in the order by the tribunal it held that it would not interfere with the
arrangement made by the mill; it instead granted an increment of Rs. 30 per
month from the date of its order to Ramkrishna Prasad to meet the ends of
justice. It is this order which is being challenged before us.
Two points have been urged before us on
behalf of the appellant. In the first place it is urged that the reference was
incompetent as sugar was a controlled industry and only the Central Government
could have made the reference and not the State Government. Secondly, it is
urged that the order of the tribunal granting an increment of Rs. 30 per month
to Ramkrishna Prasad was patently perverse and that there was no change in the
status or emoluments of Ramkrishna Prasad by the creation of the new post and
the employment of Babulal Parekh on it.
So far as the question of the competence of
the reference is concerned, we are of opinion that there is no force in it, A
similar question was raised before this Court in The Bijoy Cotton Mills Ltd. v.
Their Workmen and Another (1) and it was held there on the language of s.
2(a)(1) of the Industrial Disputes Act, 1947, that before that provision could
apply to a controlled industry there must be a notification by the Central
Government for the purposes of s. 2(a)(1) of the Industrial Disputes Act.
Section 2(a)(1) is in these terms- " I Appropriate Government' means in
relation to any industrial dispute concerning any industry carried on by or
under the authority of the Central Government or by a railway company or
concerning any such controlled industry as maybe specified in this behalf by
the Central Government, or in relation to an industrial dispute concerning a
banking or an insurance company, a mine, an oil-field or a, major port, the
Central Government. " The argument is that as sugar is a controlled
industry under the Schedule to the Industries (Development and Regulation) Act,
No. 65 of 1951, the appropriate (1)  2 S.C.R- 982, 28 218 Government for
the purposes of s. 2(a)(1) with reference to the sugar Industry is the Central
Government. Reliance is placed on the words " concerning any such
controlled industry as may be specified in this behalf by the Central
Government " appearing in s. 2 (a)(1). It is true that sugar is a
controlled industry under the Industries (Development and Regulation) Act,
1951, but that in our opinion does not conclude the matter. In order that the
appropriate government under s. 2(a)(1) may be the Central Government for a
controlled industry, it is necessary that such controlled industry should be
specified by the Central Government for the purposes of s. 2(a)(1). This in our
opinion is obvious from the words " controlled industry as may be
specified in this behalf by the Central Government " appearing in s.
2(a)(1). It is not enough that an industry should be a controlled industry to
attract this provision of s. 2(a)(1) ; it is further necessary that it should
be specified in this behalf, namely for the purposes of s. 2(a)(1), as a
controlled industry by the Central Government, before the Central Government
can become the appropriate government within the meaning of s. 2(a)(1). We may
in this connection refer to Firebricks and Potteries Ltd., etc. v. Firebricks
and Potteries Ltd. Workers Union Ltd. (1) where the same view has been taken.
We are of opinion that is the correct meaning of these words appearing in s.
2(a)(1), as already held in The Bijoy Cotton Mills Ltd. (2) . The objection
that the reference was not competent therefore fails.
We next come to the contention raised on
behalf of the mill that there was in fact no prejudice whatsoever so far as the
status and emoluments of Ramkrishna Prasad were concerned by the creation of
the new post and the appointment of Babulal Parekh on it, and that the tribunal
was not justified in any case in granting an increment of Rs. 30 per menses to
Ramkrishna Prasad. The main consideration which influenced the tribunal in
passing the order which it did was that in the view of the tribunal Ramkrishna
Prasad was superseded by Babulal Parekh who was first appointed as a clerk
This view of (1) I.L.R.  MYS. 546. (2)
 2 S.C.R. 982.
219 the tribunal in our opinion is patently
erroneous. The appointment order dated October 4, 1952, clearly shows that
Babulal Parekh was appointed as store inches from the very beginning at Rs. 180
per month. The tribunal referred to certain entries in the attendance register
to hold that Babulal Parekh worked as clerk to begin with. It appears from the
attendance register for the months of October, November and December that
Babulal Parekh was marked present from October 7 to November 9. Thereafter from
November 11 to the end of December he signed the attendance register. The
statement of Cbaudhari, Labour Welfare Officer of the mill was that the
practice in the mill was that officers used to be marked present in the
attendance register while clerks used to sign it themselves. The tribunal has
concluded from the fact that Babulal. Parekh signed the register in November
that he must have been a clerk to begin with. The tribunal, however, completely
overlooked that from October 7 to November 9, Babulal Parekh was marked present
which would show that he was not a clerk. The tribunal also overlooked that
even from November 28 to the end of December when Babulal Parekh admittedly was
not a clerk but store in- charge he still signed the register, though he should
have been marked present. Chaudhari was unable to explain how this happened,
but he was hardly the person to explain this.
It is, however, clear from this confusion
that no importance can be attached to whether Babulal Parekh was marked present
in the register or signed it. The real thing which determined the status of
Babulal Parekh was the appointment order dated October 4, 1952, which the tribunal has accepted as correct. A question was certainly put to Chaudhari at the
end of his cross-examination that he had manufactured the statements put in by
him only the night before but he denied it. We cannot accept the suggestion on
behalf of the respondents that the appointment order was ante-dated, for no
such suggestion was made to Chaudhari and the tribunal itself does not find so.
It is clear therefore that the finding of the tribunal that Babulal Parekh was
appointed as 220 clerk under Ramkrishna Prasad to begin with is patently
perverse and it must be held that Babulal Parekh was from the very beginning
working as store in-charge. Now in so far as Ramkrishna Prasad was concerned
his work and emoluments remained the same after the appointment of Babulal
Parekh. If a higher post was created in the Stores Department because of the
increase in work, Ramkrishna Prasad could not claim promotion to it merely
because he was working as a store-keeper before. There is of course no question
of supersession in this case and therefore there is no reasonable cause for any
heart burning. As the learned tribunal itself points out, " promotion to
higher post was the exclusive function of the management " and if a new
post is created and a new man appointed, as in this case, it cannot be said
that Ramkrishna Prasad's status was in any way prejudicially affected. It is
also remarkable that after saying all that it could in favour of Ramkrishna
Prasad the tribunal did not interfere with the arrangement made by the mill for
reasons which were not specified by it in the order. As such there was no
reason for granting an increment of Rs. 30 per mensem to Ramkrishna Prasad, for
even the workmen did not claim that he was entitled to any compensation in the
shape of an increment in his pay because of the appointment of Babulal Parekh.
The order of the tribunal therefore is patently unsupportable and must be set
aside. We therefore allow the appeal and set aside the order of the tribunal
and hold that no relief is due to Ramkrishna Prasad. In the circumstances we
pass no order as to costs.