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The petitioners further state that the employees of the insu-

rance companies serving throughout the country were, however, subsequently not satisfied with the pay scales, dearness allowance, other terms and conditions available to them on account of several. factors. Through their associations, they submitted their charters of demands to the General Insurance Corporation of India in 1977 for the revision of terms and conditions of their service. Negotiations were held between the management and the unions for the upward revision but according to the petitioners, nothing happened. Industrial dispute was raised between the management of General Insurance Corporation of India and the class III and IV employees. On the demand of revision of pay scales, dearness allowance and other allowances and service conditions. The Chief Labour Commissioner (Central), Government of India, Ministry of Labour, issued conciliation notice dated 11th September, 1980 under the Industrial Disputes Act, 1947 to the Chairman of the General Insurance Corporation and the general secretaries of the employees' associations. There were several meetings. It was decided, according to the petitioners, that in the meanwhile until the talks were resumed the employees would not resort to strike. There was representation to the respondents not to change the conditions of service pending the conciliation proceedings. It is not necessary to refer in detail to all these, which have been set out in the petition. But nothing fruitful happened. The Labour Commissioner in the circumstances sent a failure report under the Industrial Disputes Act, 1947 to the Secretary, Government of India, Ministry of Labour, stating that there was failure to bring about amicable settlement of disputes. The petitioners contend that no further action was taken and according to them the conciliation proceedings were still pending. This, however, is not accepted by the respondents, according to whom there was failure report and the conciliation proceedings ended thereafter. The scheme mentioned hereinbefore, which is under challenge was issued thereafter. We will have to deal with the scheme in great detail as the same is the subject matter of challenge is these petitions under Article 32 of the Constitution.

ings were still pending in the absence of Government's acknowledgement of failure report of the conciliation officer, the action of the Government in issuing the unilateral notification is bad in law. It is submitted further that impugned notification is ultra vires being violative of Article 14 of the Constitution because it discriminated between employees similarly situated, particularly in the matter of dearness allowance and retirement age.

The petitioners contend that under the Sick Textile Undertakings (Nationalisation) Act, 1974, the Coking Coal Mines (Nationalisation) Act, 1972 etc., separate companies had been formed on nationalisation. The employees of those companies were entitled to have their service conditions regulated under Industrial Disputes Act, 1947. In the present case, the employees have been deprived of the existing benefits without following the procedures prescribed under the Industrial Disputes Act, 1947. Therefore. there was discrimination and violation of article 14 of the Constitution. The petitioners therefore contend that the terms and conditions of service enunciated in 1974 being as a result of bilateral agreement, could not be changed unilaterally, to the detriment of the employees' fundamental rights to carry on their employment for gain and as such violative of article 19(1) (g) of the Constitution. It is stated that the notification was illegal, being ultra vires section 16 of the Act. Since, according to the petitioners, such notification deprived the rights of the employees to receive dearness allowance etc. with the rise in the cost of living index without any limit, it is deprivation of property without providing for compensation and is thus also violative of article 31(2) of the Constitution. The petitioners, further, contend that the Constitution 44th amendment deleting 1 Articles 31 and 19(1)

The second batch of Writ applications (Writ Petition Nos. 5434-37 of 1980) are on behalf of the employees as well as the General Insurance Employees All India Association challenge the - scheme of 1980 more or less on the same though not identical grounds mentioned in Writ Petition Nos. 5370-74 of 1980. Interim order was passed in the said application regarding payment of dearness allowance as would appear from the Court's order dated 25.8.1981. In the said order, directions were given for payment of dearness allowance payable under the old scheme from the beginning of 1981 with quarter April, as well as quarter beginning from July, 1981 within certain time mentioned in the said order. lt was further, directed that subsequent dearness allowances will be paid in accordance with the directions to be given at the time of disposal of these writ applications.

All these will be disposed of by this judgment. It will, therefore, be necessary, before we examine the contentions raised in these petitions, to briefly consider the scheme of 1980. As mentioned before, this scheme is called the General Insurance (Rationalisation and Revision of Pay Scales and other Conditions of Service of Supervisory, Clerical and Subordinate Staff) Second Amendment Scheme, 1980. Some new definitions have been provided by paragraph 2 of 1980 scheme which included the meaning of the 'Company' and under the scheme it mentioned that the 'Company' would mean the four nationalised companies, National Insurance Company Limited, the New India Assurance Company Limited, the oriental Fire and General Insurance Company Limited and the United India Insurance Company Limited. Sub paragraph (ii) of paragraph 2 of the said scheme defines 'Net monthly emoluments'. By sub- paragraph (ii), the amended definition of 'Revised terms', (Revised Scales of Pay) was inserted. By paragraph 3, adjustment of pay was stipulated on the coming into effect of operation of 1980 scheme. How the basic pay is to be fixed is provided by 1980 scheme. lt also makes detailed provisions as to how the adjustment allowance is to be dealt with so far as Dearness Allowance, overtime allowance, Contribution to Provident Fund and other retirement benefits are concerned. Paragraph 5 deals with the 'Increments. Paragraph 6 deals with Earned Leave and other Encasement of leave at the time of retirement and death. Paragraph 7 deals with 'Retirement' and' stipulates that an employee who was in service of the Corporation before the commencement of the scheme of 1980 should retire from service when he attains the age of 60 years. But an employee, who joins the service of the Corporation after the commencements of the scheme will retire on his attaining the age of 58 years. It further stipulates that an employee would retire on the afternoon of the last day of the month in which he attains the age of 60 years or 58 years as the case might be. Clause 8 deals with 'Gratuity'. Clause 10 provides the duration of revised terms and stipulates that the revised terms should be continued to be in force unless modified by the Central Government. Then the Second Schedule of 1974 scheme which dealt with Travelling Allowance category, Travel by Road and different allowances for the same, transfer grant were amended and the new Fourth Schedule included scales of pay to be fixed, on the revised scales of pay indicated therein.