State of Andhra Pradesh Vs. Narayana
Velur Beedi Manufacturing Factory & Ors  INSC 54 (26 March 1973)
MATHEW, KUTTYIL KURIEN MUKHERJEA, B.K.
CITATION: 1973 AIR 1307 1973 SCR (3) 755 1973
SCC (4) 178
F 1976 SC 277 (5)
Minimum Wages Act, 1948, s. 9-'Independent
persons'--If include Government officials.
The appellant-Government passed an order
revising minimum wages in the Bidi industry. It was based on the recommendation
of a Committee of six members consisting of persons representing employers and
employees and the Chief inspector and Deputy Chief Inspector of Factories.
Section 9 of the Minimum Wages Act, 1948, requires that the Committee shall
consist of an equal number of representatives of the employer and the employees
and of independent persons not exceeding one third of its total number. On the
question whether the two Government officials could be regarded as independent
HELD : The mere fact that they happened to be
Government officials or Government servants will not divest them of the
character of independent persons. [761C] The language of s. 9 does not contain
any indication that persons in the employment of the Government would be
excluded from the category of 'independent persons'. These words have
essentially 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.
[76OG-H] Further, the presence of high
government officials, who may have actual 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. It may be that in certain
circumstances such persons may cease to have an independent character if the
question of fixation of minimum wages in an employment in which the appropriate
Government is directly interested, arises. It would therefore depend upon the
facts of each particular case whether the persons who have been appointed could
be regarded' as independent or not. It is not correct to say that a Government
official will have a bias or that he may favour the policy which the
appropriate Government may be inclined to adopt. be,cause, when he is a member
of an Advisory Committee he is expected to give an impartial and independent
advice and not merely carry out what the Government may be inclined to do.
Government officials are responsible persons and are capable of taking a
detached and impartial view.
[76OH: 761A-E] Jaswant Rai Berl & Others
v. State of Punjab & another, A.I.R. 1958 Punj. 425, D. M. S. Rao &
Others v. The State of Kerala & Another, A.I.R. 1963 Kerala 115, Bengal
Motion Pictures Employees Union, Calcutta v. Kohinoor Pictures Private Ltd.
& Ors. A.I.R. 1964 Cal. 619, Ramkrishna Raninath Nagpur & Another v.
Tile State of Maharashtra & Another, A.I.R. 1964 Bom, 51, Chandrabhave
Boarding and Lodging & Others v. State of Mysore, A.I.R. 1968 Mys. 156 and
P. Gangadharan Pillai v. State of Kerala & Others, A.I.R. 1968 Kerala 218,
756 Norotamdas Harjivandas v. P. V. Gourikar,
Inspector, Minimum Wages, A.I.R. 1961 M.B. 182 and Kohinoor Pictures (Private)
Ltd. 'V. State of West Bengal & Others,  2 L.L.J, 741, over ruled.
CIVIL APPELLATE JURISDICTION: Civil Appeals
Nos. 1659 to 1662 of 1967.
Appeals by certificate from the judgment and
order dated January 31, 1964 of the Andhra Pradesh High Court at Hyderabad in
Writ Petition Nos. 337/63, 746/62, 735/62 and 807/62, respectively.
P. Ram Reddy and A. V. V. Nair, for the
M. C. Chagla, H. K. Puri and Niranjana Shah,
for the respondents (in C. A. No. 1659) respondents 1 to 10, 12 to 14, 16 and
19 to 29 (in C.A. No. 1660), Respondent No. 1 (in C.A. No. 1661) and
Respondents Nos. 1 to 5 (in C.A. No.1662).
The Judgment of the Court was delivered by
GROVER, J.-The sole question which has to be decided in these appeals by
certificate from a judgment of the Andhra Pradesh High Court is the meaning of
the word "independent" in S. 9 of the Minimum Wages Act, 1948,
hereinafter called the "Act".
The Act was enacted to provide for fixing the
minimum rates of wages in certain employments. Section 2 gives the definition
of various expressions. Clauses (e) (h) and (i) give the meaning of the words "employer",
"wages" and "employee" respectively. Section 3 provides for
fixing of the minimum rates of wages by the appropriate government and their
review at certain intervals. Section 5 gives the procedure for fixing and revising
minimum wages. Section 5 reads S. 5 (1) "In fixing minimum rates of wages
in respect of any scheduled employment for the first time under this Act or in
revising minimum rates of wages so fixed, the appropriate government shall
either(a)appoint as many committees and subcommittees as it considers necessary
to hold enquiries and advise it in respect of such fixation or revision, as the
case may be, or (b) by notification in the Official Gazette, publish its
proposals for the information of persons likely to be affected thereby and
specify a date not less than two months from the date of the notification, on
which the proposals will be taken into considers (2)After considering the
advice of the committee or committees appointed under clause (a) of sub-section
757 (1)or as the case may be, all representations received by it before the
date specified in the notification under clause (b) of that subsection, the
appropriate government shall, by notification in the Official Gazette, fix, or,
as the case may be, revise the minimum rates of wages in respect of each
scheduled employment, and unless such notification otherwise provides, it shall
come into force on the expiry of three months from the date of its issue :
Section 9 relates to composition of committees etc. and is in these terms
S.9."Each of the committees, sub-committees and the Advisory Board shall
consist of persons to be nominated by the appropriate Government representing
employers and employees in the scheduled employments, who shall be equal in
number, and independent persons not exceeding, one-third of its total number of
members; one of such independent persons shall be appointed the Chairman by the
appropriate Government." The Government Order which was challenged related
to the revision of minimum wages in the Bidi industry. It was based on the
recommendation of a committee consisting of six members, two of whom were Chief
Inspector of Factories, Hyderabad, and' Deputy Chief Inspector of Factories,
Hyderabad; the former being the Chairman. These two officers were to be on the
committees from among the category of independent persons mentioned in s. 9.
The whole controversy has centered on the question whether the aforesaid two
officers could be regarded as independent persons. There are a number of
decisions of the High Courts.
In majority of them, namely, Jaswant Rai Beri
& Others v.State of Punjab & Another;(1) D. M. S. Rao & Others v.
The State of Kerala & Another, (2) Bengal Motion Pictures Employees Union,
Calcutta v. Kohinoor Pictures Private Ltd.
& Others, (3) Ramkrishna Ramnath Nagpur
& Another v. The State of Maharashtra & Another; (4 ) Chandrabhava
Boarding & Lodging and Others v. State of Mysore.(5) and P. Gangadharan
Pillai v. State of Kerala & Others, (6) has been held that the mere fact
that a person happens to be , government servant or that he is an officer, he
does not cease to be an independent person within the meaning of S. 9. The only
two decisions in which a contrary view has been taken are Narottamdas Harjivandas
v. P. V. Gowarikar, Inspector, (1) A.I.R. 1958 Punj. 425.
(3) A.I.R. 1964 Cal. 519.
(5) A.I.R. 1968 Mys. 156.
(2) A.I.R. 1963 Kerala 115.
(4) A.T.R. 1964 Bom. 51.
(6) A.I.R. 1968 Kerala 218.
16--L761Sup.C.I./73 758 Minimum Wages(1) and
Kohinoor Pictures (Private) Ltd. v.State of West Bengal & Others;(2) the
latter is a judgment of the learned single Judge of the Calcutta High Court. It
may be mentioned that in the judgment under appeal the Andhra Pradesh High
Court has also taken the same view as the Madhya Pradesh court.
The reasoning of Bishan Narain J.. in the
Punjab case is quite simple. The learned Judge considered that in the context
of S. 9 an independent person means a person who is neither an employer nor an
employee in the employment for which minimum wages are to be fixed, The
presence of independent persons is necessary to safeguard the interests of
those whose requirements are met by the trade concerned.
In a welfare State, according to him, it is
the business of the Government to create conditions wherein private employers
can carry on their trade profitably as long as the workmen are not exploited.
In such circumstances the appointment of a Labour Commissioner, who is
conversant with the employment conditions, cannot be objected to on the ground
that he was not an independent person. In the first Kerala case C. A
Vaidialingam J.. as he then was, gave some additional reasons for supporting
the view of Bishan Narain J. He referred to s. 2(i) of the Industrial Disputes
Act 1947 for illustrating that a person shall be deemed to be independent for
the purpose of his appointment as Chairman or other members of a Board, Court
or Tribunal if he was unconnected with the industrial dispute referred to such
Board, Court or Tribunal or with any industry directly.
effected by such dispute. This is what the
learned Judge observed with reference to the provisions of S. 9:
"When-it speaks of persons to be
nominated by the Government to the committee representing employers and
employees in the scheduled employments and also. of nominating an
"independent person", in my view, the object of the enactment is that
the "independent person" should be who has nothing to do with the
employers or employees in the scheduled employment in question. It may that
under particular circumstances, when an industry, in which the State Government
as an employer may also be vitally interested and in which case it can be
considered to be an employer, it may not be proper to nominate an official to
the committee treating him as an independent member".
A division bench of the Calcutta High Court
consisting of Bose C. J. and G. K. Mitter J., as he then was, in Bengal Motion
Pictures Employees Union v. Kohinoor Pictures P. Ltd.
(3) referred (1) A.I.R. 1961 M.P. 182.
(3) A.I.R. 1964 Cal. 519.
(2) 1961 2 L.L.J. 741.
759 to the legislative policy underlying the
enactment of the Act. What is aimed at is the; statutory fixation of minimum
wages with a view to obviating the chances of exploitation of labour. Such
being the main object it was natural to expect that the Government would seek
the assistance of persons who were well conversant with the conditions of
labour industrial competition, profits from the industry and various other
relevant factors which are to be considered in fixing the minimum wages. It
could hardly be doubted that persons like the Labour Commissioner or the Deputy
Labour Commissioner are most suitable persons to be consulted for the purpose.
The other reason given in the Calcutta case was similar to the one which
prevailed with Bishan Narain J., in the Punjab case. In the Bombay case the
Division Bench referred to certain rules framed under s. 30 of the Act by the
Government of Bombay. According to Rule 4 provision was made for terms of
office of members of the Board and a distinction was made in subrules 2 and 3
between the non-official member and the official member of the Board. From the
scheme of the rules it was inferred that even Government officials were
contemplated to fall within the category of "independent persons". It
is unnecessary to refer to the other decisions which favour the majority view.
In the Madhya Pradesh case P. V. Dixit, C.J.,
delivering the judgment of the Bench said that the expression "independent
persons" did riot mean persons who were independent only of employers and
employees in the scheduled employment and included officials. The ordinary
connotation of the word "independent person", it was pointed out, is
of a person who is not dependent on anybody, authority or Organisation and who
is able to form his own opinion without any control or guidance of any outside
agency. It appears that in this case the learned Judges were influenced by the
consideration that the State is actively interested in the wage earners and in
the matter of fixation of minimum wages. That precluded Government officials
from falling within the class of independent persons provided for by S. 9. In
Kohinoor Pictures case(1) a learned single judge while appreciating that the
advisory committees constituted under 5 read with s. 9 of the Act have a purely
advisory function, took the view that the appropriate Government in fixing the
minimum rates of wages was not at all a disinterested person. He also took-into
consideration the interest which the Government may have in fixing the minimum
wages. According to him the fixation of minimum wages is an operation
compelling the employer to make a payment whether he wishes it or not and in
most cases contrary to his wishes. Three parties are involved in such
compulsory fixation, namely, the Government, the employer and the employed. If
(1)  2.L.L.J. 741.
760 the advisory committee is really to
consist of independent persons categories. they should be independent of all
the three Mr. Chagla for the respondents has relied a great deal on the
dictionary meanings of the word ''independent" as given in Shorter oxford
English Dictionary. One of the principal meaning given is "not depending
upon the authority of another; not in position of subordination; not subject to
external control or rule". According to Mr. Chagla a Government official
cannot be regarded as independent because he is to depend upon the authority of
the government and is in position of subordination and is subject to external
control. It has been strenuously urged that the whole object of having an
advisory committee is to get an impartial opinion or advice in the matter of
fixing of minimum wages. The committee has to consist of representatives of
employers and the employees in the scheduled employment who have to be equal in
number. The presence of independent persons not exceeding one third of the
total number of members is necessary to ensure that a proper balance is
maintained between the view of the representatives of the employers and the
employees respectively. If a government official and, in particular, one
associated either with labour or factories in his official capacity is brought
into the committee he is.
likely to be biased in his views for various
reasons. He may-know the policy of the government or he may himself have
participated in the formulation of that policy. He may have certain
predilection because of special knowledge obtained by him while serving in a
department which is connected.
with labour or industry. All these matters
would divest him of the character of an independent person.
In our judgment the view which has prevailed
with the majority of the High Courts must be sustained. The committee or the
advisory board can only tender advise which is not binding on the government
while fixing the minimum wages or revising the same as the case may be. Of
course the government is expected, particularly in the present democratic 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. 9 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
been employed in contradistiction 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 therepresentatives of the
employers and employees. Apart from this the presence of high government officials
761 who may have actual 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 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 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
government officials or government servants will not divest them of the
character of independent persons. We are not impressed 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 not merely carry out what the Government
may be inclinded to do.
Government officials are responsible persons
and it cannot be said that they are not capable of taking a detached and
For the reasons given above the appeals are
allowed and the judgment of the High Court is hereby set aside. As other
matters were left undecided in the writ petitions out of which these appeals
have arisen the case shall go back to the High Court for disposal ,in
accordance with law. Costs shall abide the event.
V.P.S. Appeals allowed.