Gujarat High Court
Valsad Jilla Sahakari Bank Ltd. vs D.K. Patel And Ors. on 29 August, 1990
Equivalent citations: [1991(63)FLR458], (1991)1GLR292, (1995)IIILLJ665GUJ
JUDGMENT Pandya, J.
1. The petitioner-Bank has challenged the order of Certifying Officer purporting to be exercising his power under the Industrial Employment (Standing Orders) Act, 1946 (hereinafter referred to as the said Act) claiming that the said Act does not apply to the petitioner-Bank. If that is so, clearly the order of said certifying officer shall be without jurisdiction and therefore, of no effect.
2. For this purpose, the learned Advocate Shri Clerk appearing on behalf of the petitioner-Bank has referred to Section 1(3) of the Act to show that the Act applies to 'Industrial Establishment'. He submitted that the petitioner-Bank is not an 'Industrial Establishment' as defined by the Act. We have, therefore to turn to definition of Clause 2(e) contained in the said Act where Industrial Establishment has been defined and for this purpose we may confine ourselves to Sub-clause (i) which reads as under:
"(i) an 'industrial establishment' as defined in Clause (ii) of Section 2 of the Payment of Wages Act, 1936."
3. It is not in dispute between the parties that no other sub-clause is relevant for the present purpose and the Bank can fall if at all in Sub-clause (i) of the definition Clause 2(e). As Sub-clause (i) refers to 'industrial establishment' as defined in Clause (ii) of Section 2 of the Payment of Wages Act, 1936, we are required to refer to that Act for understanding the meaning of said definition as contained in the said Act. When we turn to Section 2(ii) of the Payment of Wages Act, we find the following definition:
"(ii) Industrial Establishment means any-
(a) tramway or motor omnibus service;
(b) dock, wharf or jetty;
(c) inland steam-vessel;
(d) mine, quarry or oil-field;
(e) plantation;
(f) workshop or other establishment in which articles are produced, adapted or manufactured with a view to their use, transport or sale."
In order to put both these references to the aforesaid definitions in proper perspective, we have to keep in view Section 1(3) of the said Act which read as under:
"It applies to every industrial establishment wherein one hundred or more workmen are employed or were employed on any day of the preceding twelve months."
Provided that the appropriate Government may, after giving not less than two months' notice of its intention so to do, by notification in the Official Gazette, apply the provisions of this Act to any industrial establishment employing such number of persons less than one hundred as may be specified in the notification"
The said Act came to be enacted in the year 1946 and definition of Industrial Establishment as contained in the Payment of Wages Act applicable at that time is quoted hereinabove. If we try to gather the meaning to the word 'industrial establishment' in the background of the said definition of the Payment of Wages Act as it stood in 1946, it becomes at once clear that the petitioner- Bank will not be covered by the said Act.
4. However, subsequent to the aforesaid position in the year 1946 there have been changes in the definition, as contained in the Payment of Wages Act, whereby three clauses namely f, g and h came to be added of which the last one is of relevance for our purpose which reads as under:
"(h) any other establishment or class of establishment which the Central Government or State Government may having regard to the nature thereof, the need for protection of persons employed therein and other relevant circumstances, specify by notification in the Official Gazette."
5. Precisely for this reason, the learned Advocate Shri Clerk had submitted that this being a case of legislation by incorporation, the position as available at the time of enactment of a particular statute, should be borne in mind and therefore, when said Act came to be enacted in the year 1946, the position available under the Payment of Wages Act, 1936 at that time alone, would be material and any other subsequent addition or amendment thereto will be of no avail.
6. For this purpose, the learned Advocate appearing for the petitioner had cited decisions of the Supreme Court and they are: Ram Samp v. Munshi AIR 1963 SC 553 where there was a case of definition by incorporation and further on, definition incorporated from the Act itself came to be repealed and the effect of this repeal was being considered. The relevant observations are at paragraphs 11 & 12 on page 538. What was being considered in the said case was the incorporation of the definition as contained in the Punjab Alienation Land Act, 1909. Its definition was incorporated in the Punjab Pre-emption Act, 1913. As stated earlier, the said 1900 Act came to be repealed and the question posed was whether the definition earlier incorporated in another Act, will be of any avail, if the said Act is repealed thereafter. The answer given by the Supreme Court in clear terms is to the effect that such changes will not bring about any alteration in the situation because it being a device of incorporation, the position as available at the time of incorporation of the statute repealed will continue and for this purpose observations in an English decision were relied on. These observations were 'where a statute is incorporated by reference into a second statute, the repeal of the first statute by a third does not affect the second'.
Bolani Ores Ltd. v. State of Orissa. AIR-1975 SC 17. The relevant paragraph is at Page 28 Para 29. In that case the Supreme Court was concerned with the definition of 'Motor Vehicle' in Orissa Motor Vehicle Taxation Act. Therein definition of 'Motor Vehicles' contained in the Motor Vehicles Act, 1939 was incorporated by providing as such in Section 2(c) of Taxation Act. It was clearly mentioned that the term 'Motor Vehicle' as defined in Motor Vehicles Act, 1939 shall be taken for all purposes of the Taxation Act and that is how, the definition contained in the Motor Vehicles Act came to be incorporated in the Taxation Act. It was interpreted to mean that the definition was bodily lifted into Section 2(c) of the Taxation Act. Subsequently, Motor Vehicles Act came to be amended. Question was, whether later amendment to Motor Vehicles Act had any effect on the definition of 'Motor Vehicle' as incorporated in Taxation Act. The finding was that the definition of Motor Vehicle as contained in 1939 Act shall apply and subsequent amendment in the said Motor Vehicles Act will have no effect whatsoever.
7. Relying on the principle of incorporation, looking to the aforesaid two decisions, it has to be held that if the meaning of a term is incorporated from an Act which has been subsequently repealed or has been subsequently amended, the position available as on the date of passing of the statute wherein the definition has been incorporated from another statute, will prevail and will continue to hold the field and any subsequent changes in the incorporated statute will not affect the position vis-a-vis the statute in which the definition is incorporated.
8. The position, therefore, to be found in the case before us is that when the said Act came to be enacted the meaning of the terms 'industrial establishment' was to be understood in accordance with the position available at that time, under the Payment of Wages Act, 1936. That clearly excluded the petitioner-Bank and establishment of that type and as such, the order of certifying authority is clearly without jurisdiction.
9. On behalf of the respondent, a submission was made with reference to the Bombay Shops and Establishment Act where there is provision of making Payment of Wages Act applicable to the establishments covered by the Act. In this regard learned Advocate Shri Clerk has fairly conceded that Shops and Establishment Act does apply to petitioner-Bank and by virtue of a Notification issued under Section 38 of the Shops and Establishment Act making the Payment of Wages Act applicable to establishments located in the area of specified local authority. The said Notification is dated 23.1.1970 where amongst the local authorities, Valsad Municipality has been referred to at Item No. 47. Head Office of petitioner-Bank is located at Bulsar. However, the application of the Payment of Wages Act by itself will not make the Industrial Employment (Standing Order) Act, 1946 that is the said Act, automatically applicable to the Bank because by this Notification what has happened is that the Payment of Wages Act has been applied with effect from 1.4.1970 as stated in the said Notification dated 23.2.1970. This has happened notwithstanding anything contained in the Payment of Wages Act by the force of Notification itself. But that will not change the position that was available under the said Act vis-a-vis the meaning of the word 'industrial establishment' as contained in its definition Clause 2(e) to be read alongwith the Payment of Wages Act definition, as contained in it at the time when the said Act came to be passed. Thus applicability of the Payment of Wages Act to the petitioner-Bank will be of no avail so far as the question before us is concerned.
10. Before parting with the matter we may refer to one more submission advanced by learned Advocate Shrj Rathod on behalf of the respondents with reference to some of the letters that were exchanged between the petitioner-Bank and the certifying officer. This correspondence has been attached to the petition as Annexures 'A' & 'B'.
11. Learned Advocate Shri Rathod relied more on paragraph 2 of Annexure 'B' where there is a reference to Model Standing Orders. In this regard learned Advocate Shri Clerk has clarified that earlier till the petitioner-Bank had opened a Branch in centrally administered territory of Silvasa, it was covered by the Bombay Industrial Relations Act, 1946 and therefore, reference to the Standing Order, as contained in this letter Annexure-'B', would be to those certified under the BIR Act and not under the said Act. However, the situation has now altered because of the opening of the Branch at Silvasa and for this we may refer to proviso to Sub-section (3) of Section 2 of the Bombay Industrial Relations Act. It clearly provides that if a banking Company is having a Branch in more than one State the BIR Act will cease to apply. This being the position as submitted by Learned Advocate Shri Clerk, the petitioner-Bank has proceeded to devise and prescribe its own service conditions and rules and as such, the aforesaid submission made on the basis of letter Annexure 'B' has no substance. We agree with the submission of learned Advocate Shri Clerk.
12. It must, therefore, be held that the said Act does not apply to the petitioner-Bank as it is not an industrial establishment as defined by the said Act.
13. In the result, the petition succeeds. The Order (Annexure- 'C') of the certifying authority being without jurisdiction, is hereby quashed and set aside. Rule made absolute. No order as to costs.