# [1964] 7 S.C.R. 639

- **Citation:** [1964] 7 S.C.R. 639
- **Court:** Supreme Court of India
- **Decided:** 1964-04-03
- **Case number:** Special Civil Application No. 150 of 1961
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/1964-7-s-c-r-639-3091
- **Pages:** 7

## Headnote

7 S.C.R.
SUPREME COURT REPORTS
639
THE MOTOR TRANSPORT CONTROLLER. MAHARASHTRA STATE, BOMBAY AND OTHERS
I'.
PROVINCIAL RASHTRIY A MOTOR KAMGAR UNION,
NAGPUR AND ORS
IP. B. GAJENDRAGADKAR, c. J., K. N. WANCHOO AND K. c. DAS
GUPTA, JJ.]
Industrial Dispute-Termination of Service-Validity of
nof.ice--AboMion ot al! posts of an establishment-If amounts to
reduction of posts-Road Transport Corporations Act 1950(64 of
1950), as amended by Act 87 of 1956, s. 47-A-Central Provinc.s
and Berar Industrial Disputes Settlement Act, 1947 (C.P. & l:lerar
23 of 1947), s. 31 Sch. II, Item 1.
As a result of the passing of the States Reorganisation Act.
1956, Vidharbha area which was in the State of Madhya Pradesh
became part of the State of Bombay and when the State of
Bo:nba.v was divided under the Bombay Reorganisation Act, 1950,
the said area remained in the State of Maharashtra. Before 1956.
the Bombay State Road Transport Corporation and Provincial
Services established under the Road Transport Corporations Act.
1950, \\'ere operating in the States of Bombay and Madhya Pradesh
respectively. To meet the situation arising from these territorial changes, Parliament made
amendments to the Road
Transport Corporations Act, 1950, by which, inter alia s. 47-A
i,.vas introduced providing for the reconstitution, reorganisation
and dissolution of the corporations established under the Act.
On May, 27, 1961, the Central Government made an Order under
s. 47-i\ of the Act, inter alia, approving a scheme for the reorganisation of the Bombay State Road Transport Corporation and
~nnalgamating with it the Provincial Transport Services v:hich
had, under the Reorganisation Act, 1956, become a. commercial
undertaking of the State of Bombay and which had been operating in the Vidharba area. Clause 9(1) of this provided for the
abolition of all the posts in the Provincial Transport Services
and for discharge of all persons. holding such posts for service
but giving such people an option of continuing in the service of
the Maharashtra State Road Transport Corporation. Notice ter1ninating the services of the persons einployed by the Provincial
Trnnsport Services (operating in Vidharba) were issued. Thereupon. t\vo former employees of the Provincial Transport Services
and the Union of the workmen of that concern made an application before the High Court of Bombay under Arts. 226 and 227 of
the Constitution of India. challenging the validity, inter alia, of
the notices of termination of service served on the employees on
the ground that the action taken by the Government in abolish_.
ing the posts and issuing notices of termination of- services of
the employees was bad as it contravened, inter alia, the pro--
visions of s. 31 of the Central Provinces and Berar Industrial Di~
putes Settlement Act. 1947.
Held: Abolition of all posts of an establishment did not
amount to reduction of posts within the meaning of Item 1 of
the Schedule II of the Central Provinces and Berar Industrial
Disputes Settlement Act._ 1947; and the Government order aboiishing the posts and terminating the services of the employees
19GI
April S
J96l
The Motor
Transport
640
SUPREl\IE COURT Rl~PORTS
[1964 J
did not aiinount to a change within the meaning of s. 31 of the
Act. The Government was, therefore, not required to follow the
procedure• mentioned in s. 31.
_lfali:r~:;~~~",;tate

## Text

7 S.C.R.
SUPREME COURT REPORTS
639
THE MOTOR TRANSPORT CONTROLLER. MAHARASHTRA STATE, BOMBAY AND OTHERS
I'.
PROVINCIAL RASHTRIY A MOTOR KAMGAR UNION,
NAGPUR AND ORS
IP. B. GAJENDRAGADKAR, c. J., K. N. WANCHOO AND K. c. DAS
GUPTA, JJ.]
Industrial Dispute-Termination of Service-Validity of
nof.ice--AboMion ot al! posts of an establishment-If amounts to
reduction of posts-Road Transport Corporations Act 1950(64 of
1950), as amended by Act 87 of 1956, s. 47-A-Central Provinc.s
and Berar Industrial Disputes Settlement Act, 1947 (C.P. & l:lerar
23 of 1947), s. 31 Sch. II, Item 1.
As a result of the passing of the States Reorganisation Act.
1956, Vidharbha area which was in the State of Madhya Pradesh
became part of the State of Bombay and when the State of
Bo:nba.v was divided under the Bombay Reorganisation Act, 1950,
the said area remained in the State of Maharashtra. Before 1956.
the Bombay State Road Transport Corporation and Provincial
Services established under the Road Transport Corporations Act.
1950, \\'ere operating in the States of Bombay and Madhya Pradesh
respectively. To meet the situation arising from these territorial changes, Parliament made
amendments to the Road
Transport Corporations Act, 1950, by which, inter alia s. 47-A
i,.vas introduced providing for the reconstitution, reorganisation
and dissolution of the corporations established under the Act.
On May, 27, 1961, the Central Government made an Order under
s. 47-i\ of the Act, inter alia, approving a scheme for the reorganisation of the Bombay State Road Transport Corporation and
~nnalgamating with it the Provincial Transport Services v:hich
had, under the Reorganisation Act, 1956, become a. commercial
undertaking of the State of Bombay and which had been operating in the Vidharba area. Clause 9(1) of this provided for the
abolition of all the posts in the Provincial Transport Services
and for discharge of all persons. holding such posts for service
but giving such people an option of continuing in the service of
the Maharashtra State Road Transport Corporation. Notice ter1ninating the services of the persons einployed by the Provincial
Trnnsport Services (operating in Vidharba) were issued. Thereupon. t\vo former employees of the Provincial Transport Services
and the Union of the workmen of that concern made an application before the High Court of Bombay under Arts. 226 and 227 of
the Constitution of India. challenging the validity, inter alia, of
the notices of termination of service served on the employees on
the ground that the action taken by the Government in abolish_.
ing the posts and issuing notices of termination of- services of
the employees was bad as it contravened, inter alia, the pro--
visions of s. 31 of the Central Provinces and Berar Industrial Di~
putes Settlement Act. 1947.
Held: Abolition of all posts of an establishment did not
amount to reduction of posts within the meaning of Item 1 of
the Schedule II of the Central Provinces and Berar Industrial
Disputes Settlement Act._ 1947; and the Government order aboiishing the posts and terminating the services of the employees
19GI
April S
J96l
The Motor
Transport
640
SUPREl\IE COURT Rl~PORTS
[1964 J
did not aiinount to a change within the meaning of s. 31 of the
Act. The Government was, therefore, not required to follow the
procedure• mentioned in s. 31.
_lfali:r~:;~~~",;tate
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 742 of
Bomh"" a .. d Ot1"r; 1963. Appeal from the judgment and order dated July 4. 5,
'·
1961 of the Bombay High Court (Nagpur Bench) at Nagpur in
Prnl.'inrial
-
Ra.hlriya Jfotor
Special Civil Application No. 150 of 1961.
Kan11.J<Lr Unicm,
Jfagpur and Otlura
Das Gupta, J,
S. v: G11pte, Additional Solicitor-General, G. B. Pai, and
R. H. Dliebar, for the appellants.
The respondent did not appear.
April 3, 1964. The Judgment of the Court was delivered
by
DAs. GUPTA, J.-A short point arises for consideration in
this appeal. But to understand how the point arises it is necessary to embark on a somewhat lengthy statement of facts.
Three Road Transport Corporations established under the
Road T(ansport Corporation Act, 1950 were operating in the
States of Bombay, Madhya Pradesh and Hyderabad in J 956
when the States E.eorganisation Act, 1956 was enacted. These
three cdrporations were known as the Bombay State Road
fransport Corporation, the Provincial Transport Service and
the State Transport Marathewada respectively. As a result of
the reorganisation of the States under the States Reorganisation Ac,, 1956 the former State of Bombay Jost certain of its
territories to the newly formed
State of Mysore and some
areas to, the State of Rajasthan. On the other hand, the State
oi Bombay gained the Marathewada from the State of Hyderabad and the Vidharbha area from the State of Madhva Pradesh and certain other areas from the then existing State of
Saurashlra and the State of Kutch.· To meet the situation
;;rising from these territorial changes, Parliament passed the
Road Transport Corporation Amendment Act, 1956, thus
amending the Road Transport Corporation Act, 1950. Section 47;A which was introduced by the amending Act provides fqr the reconstitution, reorganisation and dissolution of
the Corporations established under s. 3 of the Act. On December 3 L l 956 an order was made by the Central Government
under (he provisions of this section approving a scheme for
reorganisation submitted by the Government of Bombay.
By
thi~ scheme those areas in which the Bombay State
Road transport Corporation had been operating but were
transferred under the State Reorganisation Act to the
States .of Mysore and Rajasthan were excluded from the
area of the operation of the Bombay State Road Transport
Corpo~ation. This came into force from the !st January, 1957.
Another consequence of the States Reorganisation Act was
that the two commercial undertakings which were known as
!
.•
' '
':..-~J;-'._.;.--;-··": ;\
.- . ' "-'" -
' . ~- .
/ \ /
7 S.C.R.·
. SUPREThIB. COURT :REPORTS
641
,,
the Provincial Transport Services. and . the State Transport,
1961
Marathewada •. became the commercial iindertakings of the
Tho J!otor
State ·of Bombay. Further, territorial changes occurred in the
Tra.,,por1
State of Bombay in the year 1960. By the Bombay ReorganiController,
sation Act, No. 11 of 1960, the State of Bombay was again f{.':!b;;~'!~;; g~;.
divided; part of what was in the former State, was formed
v.
into a new State by the name of the State of Gujarat, while
Pnnincial
the remaining area. was named, the State of Maharashtra. In
:~~~::cl,{~":"
consequence of this scme: other. areas were excluded by an Nagpur and Otn.ra
order under s. 47-A of the Act from the area of operation of
the Bombay State Road Transport· CorjJoiation. ·The' situaDa• Gupta, J,
tion then was the · State Transport, Marathewada, . was
operating in the Maharashtra area, the Provincial Transport
Service was operating in the Vidharbha area while in the
rest of the Maharashtra State the Bombay ··State Transport
Corporation was operating. It was when things stood like this
that the Central Government made an order on the.27th May;
1961 under s. 47-A of the Amending Act. By this. orde~ it approved a scheme for the ree1rganisation of the Bombay State
Road Transport COrporation and amalgamation with' it·of
the two other transport undertakings of the State Government,
viz .. the Provincial Transport Services, and the State Trans;
port, Mara.thewada. After the reorganisation the Corporation
was to be known as. the Maharashtra State Road Transport
Corporation. Clause 9(1) of this Order provided' for the abolition of all the posts in the· two· undertakings, the Provincial
Transport Services. and. the : State Transport Marathewada;
and for discharge of all persons holding such posts·from service. There was a provision, however. , giving · such people
option either of taking terminal benefits .such as compensation.
pension, or gratuity to which they may. be entitled under the
rules applicable to them or of continuing as from the !st July
1961 in the service of the Maharashtra State Road Transport
Corporation. Sub-clause 2 of cl. 9 provided that every person
who as a result of the exercise of such option· is continued in the
service of the Maharashtra State Transport Corporation shall
be entitled to be employed by that Corporation on· the same
terms and conditions, including pay. as were applicable to him
immediately before the appointed ·day and to count his service
under the previous . corporations·, for ... a!L purposes .. Sub.
clause 3 'of cl. 9 was in these words:.:... . . . . . .
.
"Nothing '.in; ,sub-paragraph (2) ·shall be deemed to
·. affect the right of the Maharashtra State Road
-. Transport. Corporation, subject to the provisions
. of s. 77 of the Bombay Reorganisation Act, 1960
(11 of. 1960) to determine or vary after the appointed day, the conditions of service of any person who is continued.in the service of the CofPO'
_·ration".
i_:_, . -
I.II' Jl)!SCI-21
._
,
.
1964
The .. lfolvr
TraiMporl
Controller.
}.!alwrashtra State.
Bombay a11tl Of/1Pf.>J
v.
P·roviiicirrl
Rashtriya Jlotor
Kamgar 'fJnion,
),? agpur and Others
Das G1lpta, .J.
642
SUPREME COURT HEPORTS
[1964]
"Provided that the conditions of service ap·
plicable immediately before the aJtlointed day.
to anv such person shall not be varied to his disadvantage. except with the previous approval of
the Central Government".
Notices
terminatiqg
the
services of the employees
employed by the Provincial Transport Services (operating in
Vidharbha) were issued.
On 12th June 1961
an applica·
lion was made under Art. 226 and Art. 227 of the Constitu·
tion by two former employees of the Provincial Transport
Services and the Union cf the workmen of that concern -::hal·
!enging the validitv of the order of reorganisation made
on -the 27th Mav. 1961 and the notices of ter'illination of ser·
vice served on ·the employees. The following reliefs were
prayed for: (a) that the notices of termination be quashed;
ib) that the amalgamation of the Provincial Transport Services
with the Bombay State Road Transport Corporation as directed under s. 47-A be not carried out, and {c) that "a writ of mandamus be also issued to respondents 1 to 3 directing them to
carry out the obligations under s.25-F and other provisions of
retrenchment of the Industrial Disputes Act, 1947, and other
provisions of law before taking any action as required by law
. and also by paragraph 9 of the order even assuming that the
amalgamation order is legal and proper."
Three contentions were raised in support of these prayers.
lt was first urged that the order made on the 27th May violated the provisions of s.47-A of the Act and was therefore bad
in law, The second contention was thnt the proviso to subcl.3 of cl.9 of the order contravenes the provisions of s.77 of
the Bombay Reorganisation Act. Lastly, it was contended
that the a.ction taken by the Government in abolishing the
posts and issuing notices of termination of services of the employees was bad-firstly because it contravened s.25F (b) and
le) of the Industrial Disputes Act and secondly, because it
contravened the provisions of s.31 of the C.P. and Berar Industrial Disputes Settlement Act, 1947.
The High Court rejected the first contention
that the
Government Order violated s.47-A of the Act. It also rejected
\he petitioner's contention that the action taken by the Government was bad because of contravention of s.25F (b) and
(c) of the Industrial Disputes Act. The High Court was however of opinion that the proviso to sub-cl. 3 of cl. 9 of the order
was bad in law, being in conflict with s.77 of the Bombay
Reorganisation Act, but it held that the proviso was severable
and its illegality did not affect the working of the ;cheme. The
Hi?h Court also accepted the petitioner's contention that the
action taken by the Government in issuing notices of termination of services on abolition of posts did not comply with the
provision> of s.3 l of the C.P. and Berar Industrial Disputes
7 S.C.R.
SUPRElIE COURT REPORTS
643
Settlement Act and was accordingly invalid. In the result, the
196#
High Court quashed the Government resolution for abolition
1'1'e ~fo10,
of posts and the notices of termination that were issued in
J'ran.<pc.i·t
consequence thereof. It also ordered the issue of a directi0n, ,1 f 0"'';·llcr,,
.
.
T
C
.
.:1 a11oras11lra ._..,fate
dtrectmg the Maharashtra State Road ransport
orporahon Homb"'' '""' un,,.~
'·not to take any action under the proviso to sub-paragraph
· ':· .
(3l of paragraph 9 of the Order relating to varying the condi1, P,r,
0
~··
11",
0
1
1
1
•
•
.
,.aeu1 riya J' u vr
lions of services to the disadvantage of any of the employees
Xnmyar L"nion,
who were employees of the first respondent immediately be- Xaypnr and 011,era
fore the appointed day, i.e., Ist July 1961." Against these
1,,,, G,,-;,11, J.
orders of the High Court, the State of Mahrashtra, the Maharashtra State Road Transport Corporation and the Moter
Transport Controller, Maharashtra, have appealed. At the
hearing of the appeal nobody appeared before us on behalf
of the petitioners in the High Court. The correctness of the
High Court's decision that the order of the 27th May, 19"1il did
not violate s. 47-A of the Act was not challenged before us.·
Nor was the High Court's decision that the Government's
action in abolishing posts and terminating services of
employees was
not bad because of contravention of
s.
25F(b) and (c) of the Industrial Disputes Act, que'-
tioned before us. We have, therefore, not examined the
correctness or otherwise of these conclusions and shall dispose of the appeal on the basis that the decision· on these
points are correct.
The first contention urged in support of the appeal is that
the High Court was wrong in thinking that in ordering the
abolition of posts and terminating the services of employees
in those posts the Government had contravened the provisions of s. 31 of the C. P. and Berar Industrial Disputes Settlement Act. That section is in these words:-
"31. (I) If an employer intends to effect a change in
any standing orders settled under s. 30 or in respect of any industrial matter mentioned in Schedule II, he shall give fourteen days' notice of such
intention in the prescribed form to the representative of employees.
(2) The employer shall send a copy of the notice to
the Labour Commissioner, Labour Officer and
· to such other person as may be prescribed and shall
a !so affix a. copy of the notice at a conspicuous
place on the premises where the employees affected
by the proposed change are employed and at such
other places as may be specially directed by the
Labour Commissioner in any case.
(3) On receipt of such notice the representative of
employees concerned shall negotiate with the
employers".
L'PiD)IKCT-~l(a)
644
SUPREl\IE COURT REPORTS
[1964]
1964
Schedule II of this Act mentions a number of matters,
Tht.'llotor
the first of which is "Reduction intended to be of permanent
Transport
or semi-permanent character in the number of persons employMa/j,~':,':e;~'state, ed or tho be emJ?
1lol?I nhot dHll:ehtoCforce majeuhre". bTh
1
_e. argufBomliay and Others ment t at preva1 eu m t e
1g
ourt was t at a o 1tton o
all posts amounted to permanent reduction within the meanv.
Provin<ial
ing of this Item in Schedule II. If that be correct it would
Raihtriya Motor, necessarily follow that the Government had to observe the
N~;::;:;,,p0f::, procedure prescribed in s. 31. Admittedly, that was not done.
The short question, therefore, is whether the abolition of all
Dal Gupta, J.
posts of an establishment amount to reduction of posts. In our
opinion. the word reduction can only be used when something
is left after reduction. To speak of abolition as a reduction of
the whole thing does not sound sensible or reasonable. We
are unable to agree with the High Court that the term "reduction in the number cf persons employed or to be employed"
as mentioned in Item l of Schedule II covers abolition of all
posts. In our opinion, the Government Order in abolishing
the posts and terminating the services of the employees did
not amount to a change within the meaning of s~ 31 of the
C. P. and Berar Industrial Disputes Settlement Act. The Government was, therefore, not required to follow the procedure
mentioned in s. 31.
This brings us to the que~,tion about the validity of the
proviso to sub-cl. 3 of cl. 9 of the Order. As already indicated
thf' workmen's contention was that the proviso contravened
the provisions of s. 77 of the Bombay Reorganisation Act.
That section contained a prcJvision . that on transfer or reemployment of any workman in consequence of reconstitution, reorganisation, amalgamation or dissolution by any body
rnrporate, cooperative society or any commercial undertaking
or industrial undertaking the terms and conditions of
service applicable to the workman after such transfer
or reemployment
shall not be less favourable to the
workman than those applicable to him immediately before
the transfer
of reemployment.. It was
apparently apprehended by the workmen that though sub-cl. 3 of cl. 9 of the
Order did state definitely that the right of the Maharashtra
State Road Transport Corporation to determine or vary the
conditions of service of any person who is continued in the
service of the corporation was subject to the provisions of s. 77
of the Bombay Reorganisation Act, advantage might be taken
of the proviso to the sub-clause, which seems at least at first
sight to suggest that with the approval of the Central Govern ..
ment tht- conditions of service of a workman might be varied
to his disadvantage notwithstanding the provisions of s. 77 of
the Bombay Reorganisation Act. We are informed, however.
that there has been no such variation. The petition itself did
not contain any specific assertion that there had been any -
•
7 S.C.R.
SUPRE:~IE COURT REPORTS
645
variation to the disadvantage of any workman. Only an ap1vu1
prehension that there might be a change in future was expressn, Mo'"'
ed. In the counter-affidavit the Government stated that •he
T"""P'"'
Order passed in the notices issued clearly gave a guarantee that
a,,,,,.o/hr.
the conditions of service will not be changed. If there was any ·1!"""'."""',.,, """'·
•
•
•
iJ111n9a11 rtnrl Otlu,rs
reason to thmk that there had been any change m any cond1-
· v.
tions of service or that in the immediate future there was any
p,."';,.d,,l
l.k l"h
d f
I
1
. b .
d
h
h f
n,,4,i,;ya Motw
i e .1 oo o any s~c l. c 1ange erng ma e on t e strengt o
1.:_,1111y,1r t.:,iinn,
the impugned proviso 1t would have been necessary for us to Sagpw and Ulh•r.•
examine the question about the validity of this proviso. As
h
h
b
d
d . d
iJa.\' Ou1Jfrt, .J.
owever, no change appears to ave een ma e an
1t oes
not appear that there was any apprehension of any change
being made in the immediate future, we have thought it desirable to leave this question open-particularly in view of the
fact that the workmen were not represented before us in this
appeal. We have, therefore, not heard full arguments on this
question from the learned Counsel for the appellant.
The decision of the High Court that the proviso is bad is
therefore, set aside and the question is left open for decision
if and when it becomes really necessary to do so. In view of
our decision that the High Court erred in thinking that s. 31
of the C P. and Berar Industrial Disputes Settlement Act had
to be applied the High Court's order quashing the abolition of
posts and the notices of termination cannot be sustained.
We accordingly allow the appeal, set aside the order of
the High Court quashing the Government resolution of the
29th May, 1961 directing the abolition of posts and also its
order quashing the notices of termination. As we have set aside
the High Court's decision as regards the validity of the proviso
to sub-cl. 3 of cl. 9 of the Order and left the matter open, the
High Court's direction that no action should be taken under
the proviso is also set aside. There will be no order as to
costs.
·
Appeal allowed .