# CASE DETAILS UNION OF INDIA & ORS v. K. SURI BABU

- **Citation:** 2023 INSC 1033
- **Court:** Supreme Court of India
- **Decided:** 2023-11-29
- **Case number:** Civil Appeal No. 1320 of 2010
- **Bench:** Sanjay Kishan Kaul, C. T. Ravikumar, Sudhanshu Dhulia
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/case-details-union-of-india-ors-v-k-suri-babu-36803
- **Pages:** 21

## Headnote

Issue for consideration: Whether the disciplinary proceedings against
the respondent-workman, could be initiated under the Central Civil Services
(Classifi cation, Control and Appeal) Rules, 1965 or it could be done only
under the Standing Orders certifi ed for the Nuclear Fuel Complex-Hyderabad
on 27.08.1973, under the Industrial Employment (Standing Orders) Act,
1946.
Industrial Employment (Standing Orders) Act, 1946 - Central
Civil Services (Classification, Control and Appeal) Rules, 1965 -
Tribunal upheld the initiation of the disciplinary proceedings by the
Nuclear Fuel Complex-Hyderabad, against the respondent under the
Central Civil Services (Classifi cation, Control and Appeal) Rules,
1965 - Order set aside by High Court - Case of the respondent is that
he being a workman will be covered by the Standing Orders under the
1946 Act which contain provisions to deal with matters, inter alia, of
disciplinary proceedings:
Held: Standing Orders made under the 1946 Act are Rules specifi c
to workmen in an industrial establishment - 1946 Act, Industrial Disputes
Act, 1947 and other such legislations of this period, are worker friendly
legislations, enacted to regulate the working conditions of workmen -
Standing Orders grant a protection to a workman, inter alia, when he
faces a disciplinary proceeding initiated by the employer - Employer is
undoubtedly on a much powerful position than a workman and has much
stronger bargaining power and consequently the statute has been made to
1047
create a balance - The protection of the 1946 Act, cannot be denied to a
workman merely for the reason that the employer grants him other services
benefi ts such as pension, gratuity etc. under CCA Rules - A standing order
is no ordinary order - It has a statutory mandate - CCA Rules, 1965 are
the general Rules whereas Standing Orders are the Special Rules and will
override any other general Rule including CCA Rules, 1965 - Moreover,
the Standing Orders cover a wide area of activities of a workman and are
workmen specifi c yet in view of s.13B of 1946 Act, a specifi c notifi cation
can be made applying CCA Rules, 1965 to that specifi c aspect - But a
notifi cation is necessary - In the present case, there is nothing on record
to show that after the standing orders, which stood certifi ed in the year
1973 and were in force, any subsequent modifi cation was made or any
order passed curtailing these standing orders, u/s.10 of the 1946 Act - In
the absence of notifi cation u/s.13B of the 1946 Act, there is no fault with
the order of the High Court holding that it will be the standing orders and
not the CCA Rules, 1965 which will be applicable - Service conditions
of respondents will be governed by the Standing Orders as far as the
disciplinary proceedings are concerned - Order passed by the High Court
upheld - Industrial Disputes Act, 1947 - Service Law. [Paras 7, 8, 11, 17,
18, 20 and 21]
 Service Law - Special Rules vis-à-vis General Rules - Standing
Orders under the Industrial Employment (Standing Orders) Act, 1946
vis-à-vis Central Civil Services (Classifi cation, Control and Appeal)
Rules, 1965:
Held: Standing Orders have the nature of Special Rules - Only in
those cases, where the Special Rules fail to lay down provisions for dealing
with certain subjects, can the General Rules be pressed into service - The
CCA Rules are General Rules which apply to all Government Servants - In
the present case, when the Standing Orders for the Department clearly laid
down a procedure to be followed in cases of Disciplinary proceedings under
Order Nos. 38, 39 & 40, there was no reason for the Department to initiate
the said proceedings under the CCA Rules - NFC, Hyderabad failed to
place on record any modifi cation made u/s.10 of the 1946 Act to show that
the Standing Orders certifi ed for NFC-Hyderabad would not be applicable
to the respondent. [Paras 19, 20]
UNION OF INDIA & ORS. v. K. SURI BABU
1048
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Industrial Employment

## Text

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[2023] 15 S.C.R. 1046 : 2023 INSC 1033
1046
CASE DETAILS
UNION OF INDIA & ORS.
v.
K. SURI BABU
(Civil Appeal No. 1320 of 2010)
NOVEMBER 29, 2023
[SANJAY KISHAN KAUL, C. T. RAVIKUMAR AND
SUDHANSHU DHULIA, JJ.]
HEADNOTES
Issue for consideration: Whether the disciplinary proceedings against
the respondent-workman, could be initiated under the Central Civil Services
(Classifi cation, Control and Appeal) Rules, 1965 or it could be done only
under the Standing Orders certifi ed for the Nuclear Fuel Complex-Hyderabad
on 27.08.1973, under the Industrial Employment (Standing Orders) Act,
1946.
Industrial Employment (Standing Orders) Act, 1946 - Central
Civil Services (Classification, Control and Appeal) Rules, 1965 -
Tribunal upheld the initiation of the disciplinary proceedings by the
Nuclear Fuel Complex-Hyderabad, against the respondent under the
Central Civil Services (Classifi cation, Control and Appeal) Rules,
1965 - Order set aside by High Court - Case of the respondent is that
he being a workman will be covered by the Standing Orders under the
1946 Act which contain provisions to deal with matters, inter alia, of
disciplinary proceedings:
Held: Standing Orders made under the 1946 Act are Rules specifi c
to workmen in an industrial establishment - 1946 Act, Industrial Disputes
Act, 1947 and other such legislations of this period, are worker friendly
legislations, enacted to regulate the working conditions of workmen -
Standing Orders grant a protection to a workman, inter alia, when he
faces a disciplinary proceeding initiated by the employer - Employer is
undoubtedly on a much powerful position than a workman and has much
stronger bargaining power and consequently the statute has been made to
1047
create a balance - The protection of the 1946 Act, cannot be denied to a
workman merely for the reason that the employer grants him other services
benefi ts such as pension, gratuity etc. under CCA Rules - A standing order
is no ordinary order - It has a statutory mandate - CCA Rules, 1965 are
the general Rules whereas Standing Orders are the Special Rules and will
override any other general Rule including CCA Rules, 1965 - Moreover,
the Standing Orders cover a wide area of activities of a workman and are
workmen specifi c yet in view of s.13B of 1946 Act, a specifi c notifi cation
can be made applying CCA Rules, 1965 to that specifi c aspect - But a
notifi cation is necessary - In the present case, there is nothing on record
to show that after the standing orders, which stood certifi ed in the year
1973 and were in force, any subsequent modifi cation was made or any
order passed curtailing these standing orders, u/s.10 of the 1946 Act - In
the absence of notifi cation u/s.13B of the 1946 Act, there is no fault with
the order of the High Court holding that it will be the standing orders and
not the CCA Rules, 1965 which will be applicable - Service conditions
of respondents will be governed by the Standing Orders as far as the
disciplinary proceedings are concerned - Order passed by the High Court
upheld - Industrial Disputes Act, 1947 - Service Law. [Paras 7, 8, 11, 17,
18, 20 and 21]
 Service Law - Special Rules vis-à-vis General Rules - Standing
Orders under the Industrial Employment (Standing Orders) Act, 1946
vis-à-vis Central Civil Services (Classifi cation, Control and Appeal)
Rules, 1965:
Held: Standing Orders have the nature of Special Rules - Only in
those cases, where the Special Rules fail to lay down provisions for dealing
with certain subjects, can the General Rules be pressed into service - The
CCA Rules are General Rules which apply to all Government Servants - In
the present case, when the Standing Orders for the Department clearly laid
down a procedure to be followed in cases of Disciplinary proceedings under
Order Nos. 38, 39 & 40, there was no reason for the Department to initiate
the said proceedings under the CCA Rules - NFC, Hyderabad failed to
place on record any modifi cation made u/s.10 of the 1946 Act to show that
the Standing Orders certifi ed for NFC-Hyderabad would not be applicable
to the respondent. [Paras 19, 20]
UNION OF INDIA & ORS. v. K. SURI BABU
1048
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Industrial Employment (Standing Orders) Act, 1946 - Objective
and purpose - Discussed.
LIST OF CITATIONS AND OTHER REFERENCES
Sudhir Chandra Sarkar v. Tata Iron & Steel Co. Ltd. [1984] 3 SCR
325: (1984) 3 SCC 369; U.P. State Electricity Board and Another v. Hari
Shankar Jain and Others, AIR 1979 SC 65 - relied on.
Salem-Erode Electricity Distribution Co. (P) Ltd. v. Employees' Union
[1966] 2 SCR 498, Management, Shahdara (Delhi) Saharanpur Light
Railway Co. Ltd. v. S.S. Railway Workers Union [1969] 2 SCR 131; Agra
Electric Supply Co. Ltd. v. Sri Alladdin and Others (1969) 2 SCC 598;
Western India Match Co. Ltd. v. Workmen [1974] 1 SCR 434: (1974) 3 SCC
330; Oil and Natural Gas Corporation Ltd. v. Petroleum Coal Labour Union
& Ors. [2015] 5 SCR 474 : (2015) 6 SCC 494 - referred to.
Air India v. Union of India ILR (1991) 1 Del 88 - referred to.
OTHER CASE DETAILS INCLUDING IMPUGNED
ORDER AND APPEARANCES
CIVIL APPELLATE JURISDICTION: Civil Appeal No.1320 of 2010.
From the Judgment and Order dated 14.10.2008 of the High Court of
A.P. at Hyderabad in WP No.9541 of 2008.
With
Civil Appeal No.1323 of 2010.
Appearances:
Gurmeet Singh Makker, R. Bala, Ms. Arunima Dwivedi, Nachiketa
Joshi, Shubhendu Anand, Arkaj Kumar, Rajat Nair, Anuj Srinivas Udupa,
Aakarsh Mishra, Shivam Shukla, Ms. Tanya Agarwal, Advs. for the
Appellants.
Anand Padmanabhan R, V. Sridhar Reddy, V. N. Raghupathy, Advs.
for the Respondent.
1049
JUDGMENT / ORDER OF THE SUPREME COURT
JUDGMENT
SUDHANSHU DHULIA, J.
1. These are the two appeals fi led by the Union of India; Appeal
No.1320/2010, is against the order dated 14.10.2008 passed by a Division
Bench of the High Court of Judicature, Andhra Pradesh at Hyderabad in
Writ Petition No.9541 of 2008 and Appeal No. 1323/2010 is against the
order dated 22.01.2009, of a Division Bench of the High Court of Judicature,
Andhra Pradesh at Hyderabad passed in Writ Petition No.494/2009. The
issue in both the Civil Appeals raised is identical, but for the sake of
convenience, for facts we would be only referring to Civil Appeal No.1320
of 2010.
2. The High Court in the impugned order dated 14.10.2008 has
allowed the Writ Petition of the respondent by setting aside the order (dated
18.03.2008), passed by the Central Administrative Tribunal, Hyderabad (for
short 'CAT') which upheld the initiation of the disciplinary proceedings
by the Nuclear Fuel Complex-Hyderabad (hereinafter referred to as 'NFC'
or 'Department'), against the respondent under the Central Civil Services
(Classifi cation, Control and Appeal) Rules, 1965 (for short 'CCA Rules
1965'). The short question which was there before the High Court and
which is now before us, is whether the disciplinary proceedings against
the respondent (who is admittedly a workman), could be initiated under
the CCA Rules 1965 or it could be done only under the Standing Orders
certifi ed for the NFC-Hyderabad on 27.08.1973 (hereinafter referred to as
"Standing Orders"), under the Industrial Employment (Standing Orders)
Act, 1946 (hereinafter referred to as '1946 Act').
3. NFC was set up in the 1970s, as a constituent unit of the Department
of Atomic Energy, Government of India. The respondent was appointed
as a 'helper' w.e.f. 05.05.2001 in NFC. Helper is the class IV post and it
seems that the eligibility requirement for the post was a Class VI certifi cate
which the respondent had submitted in order to get the appointment. On
23.04.2003 he received a memorandum which said that he had given a
false declaration that he had passed Class VI as the transfer certifi cate of
UNION OF INDIA & ORS. v. K. SURI BABU
1050
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Class VI submitted by him was found to be fake for which a disciplinary
action was to be initiated against him under CCA Rules 1965. In response,
the respondent denied the allegations and asserted that his certifi cate is
genuine and further contended that the disciplinary proceedings, if any,
would be governed by the Standing Orders and not under the CCA Rules
1965, and ultimately, he fi led an OA before the CAT, Hyderabad, with a
prayer to set aside the proceedings against him, inter alia, on the grounds
that the disciplinary proceedings against him can only be initiated under the
"Standing Orders", and not under the CCA Rules. The CAT, dismissed his
O.A. vide its order dated 18.03.2008. The CAT relied on his appointment
order, as well as the circular dated 12.05.2005 issued by the Department
to clarify that their employees were governed by the CCA Rules and not
Standing Orders. This order of CAT, was challenged by the respondent in a
writ petition before the High Court which was allowed and the order of the
CAT was set aside and the disciplinary proceedings against the respondent
were quashed.
4. The case of the respondent is that he being a workman will be covered
by the Standing Orders which contain provisions to deal with matters, inter
alia, of disciplinary proceedings, and therefore the proceedings initiated
against him under the CCA Rules, 1965 are without jurisdiction. On the
other hand, the appellants before this Court would argue that the respondentworkman is governed by the CCA Rules 1965, being an employee of NFC,
Hyderabad. One of the terms and conditions stated in his appointment order
was that he would be governed under the CCA Rules, even for disciplinary
proceedings. Further, it is under the CCA Rules where a large number of
benefi ts are liable to be given to the employees of the Department. On the
date, an employee reaches the age of superannuation, he gets his pension
only under the CCA Rules 1965, apart from a large number of other benefi ts
and therefore it is not open for the employee to say that as long he enjoys
the benefi ts, the Rules will be applicable, but the same Rules will not be
applicable in the disciplinary proceedings against him. Such an argument
is not tenable under the law, the department would argue.
5. We have heard Mr. Arkaj Kumar, learned counsel for the appellants
and Mr. Anand Padmanabhan R. learned counsel for the respondent
workman, at length and have perused the material on record.
1051
UNION OF INDIA & ORS. v. K. SURI BABU
[SUDHANSHU DHULIA, J.]
6. Learned counsel appearing for the Department has drawn our
attention to the appointment order dated 05.05.2001, which states that in
matters of disciplinary proceedings the employee will be governed by the
CCA Rules. The relevant provision mentioned in the appointment order is
as under:
"3. I am to add that other terms and conditions of your service
including discipline will be governed by the rules as applicable to
Central Government employees of your status in NFC from time to
time. Your leave entitlement will be admissible to Industrial employees
in departmental undertakings under Appendix-XI of CSR Vol. II (8th
Edition) (Ref. Ministry of fi nance Memo No. 7(84) E-IV(A)/B1, dt.
17.11.61 as amended vide Ministry of Finance Memo No. B(1)-EIV(A)/70, dt. 27.03.71). Other conditions of service will be governed
by the Rules and Orders of the Central Government in force from
time to time."
Since the Rules applicable to Central Government employees are the
CCA Rules 1965, the reference in the appointment order to the applicable
Rules, is of CCA Rules, 1965.
7. Standing Orders made under the Industrial Establishment (Standing
Orders) Act, 1946 are however Rules specifi c to workmen in an industrial
establishment. Industrial Employment (Standing Orders) Act 1946,
Industrial Disputes Act, 1947 and a number of other legislations of this
period, are worker friendly legislations, which were enacted with a purpose
i.e., to regulate the working conditions of workmen. Standing Orders
grant a protection to a workman, inter alia, when he faces a disciplinary
proceeding initiated by the employer. The employer is undoubtedly on a
much powerful position than a workman and has much stronger bargaining
power and consequently the statute has been made to create a balance.
This position has been held by this Court in a catena of decisions, namely,
Salem-Erode Electricity Distribution Co. (P) Ltd. v. Employees' Union
(1966) 2 SCR 4981, Management, Shahdara (Delhi) Saharanpur Light
Railway Co. Ltd. v. S.S. Railway Workers Union (1969) 2 SCR 1312 and
1
Paragraph No. 8
2
Paragraph No. 7
1052
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Agra Electric Supply Co. Ltd. v. Sri Alladdin and Others (1969) 2 SCC
5983 etc.
8. The protection of the 1946 Act, cannot be denied to a workman
merely for the reason that the employer grants him other services benefi ts
such as pension, gratuity etc. under CCA Rules. The purpose behind this
worker-friendly legislation was explained by this Court in Sudhir Chandra
Sarkar v. Tata Iron & Steel Co. Ltd. (1984) 3 SCC 369:
"11. Parliament enacted the Industrial Employment (Standing
Orders) Act, 1946 ("1946 Act" for short). The long title of the
Act provides that it was an act to require employers in industrial
establishments formally to defi ne conditions of employment under
them. The preamble of the Act provides that it is expedient to require
employers in industrial establishments to defi ne with suffi cient
precision the conditions of employment under them and to make the
said conditions known to workmen employed by them. By Section
3, a duty was cast on the employer governed by the Act to submit
to the Certifying Offi cer draft standing orders proposed by him
for adoption in his industrial establishment. After going through
the procedure prescribed in the Act, the Certifying Offi cer has to
certify the draft standing orders. Section 8 requires the Certifying
Offi cer to keep a copy of standing orders as fi nally certifi ed under
the Act in a register to be maintained for the purpose. Sub-section
(2) of Section 13 imposes a penalty on employer who does any act
in contravention of the standing orders fi nally certifi ed under the
Act. The Act was a legislative response to the laissez faire rule of
hire and fi re at sweet will. It was an attempt at imposing a statutory
contract of service between two parties unequal to negotiate, on the
footing of equality. This was vividly noticed by this Court in Western
India Match Company Ltd. v. Workmen [(1974) 3 SCC 330 : 1974
SCC (L&S) 531 : (1974) 1 SCR 434 : (1973) 2 LLJ 403] as under :
[SCC para 10, p. 334 : SCC (L&S) p. 536]
"In the sunny days of the market economy theory people
sincerely believed that the economic law of demand and supply
3
Paragraph No. 5
1053
in the labour market would settle a mutually benefi cial bargain
between the employer and the workman. Such a bargain, they
took it for granted, would secure fair terms and conditions of
employment to the workman. This law they venerated as natural
law. They had an abiding faith in the verity of this law. But the
experience of the working of this law over a long period has
belied their faith."
The intendment underlying the Act and the provisions of the Act
enacted to give eff ect to the intendment and the scheme of the Act
leave no room for doubt that the Standing Orders certifi ed under
the 1946 Act become part of the statutory terms and conditions of
service between the employer and his employee and they govern the
relationship between the parties. Workmen v. Firestone Tyre & Rubber
Co [(1973) 1 SCC 813, 832 : 1973 SCC (L&S) 341, 360 : (1973)
3 SCR 587, 612 : (1973) 1 LLJ 278] Workmen v. Buckingham and
Carnatic Mills [(1970) 1 LLJ 26, 29 (SC)] and Glaxo Laboratories
v. Presiding Offi cer Labour Court, Meerut [(1984) 1 SCC 1 : 1984
SCC (L&S) 42]"
9. The submission made by the learned counsel for the NFC Shri Arkaj
Kumar is that since the appointment order itself provides that disciplinary
issues will be governed by the CCA Rules 1965, there should be no room for
any doubt as to the applicability of the Rules in the disciplinary proceedings.
This may not be always correct. An appointment order cannot lay down
terms of service which are against what is provided in the Standing Orders,
as they are binding on the employer. This Court in the case of Western India
Match Co. Ltd. v. Workmen (1974) 3 SCC 330 had directed reinstatement
of a worker, who had been illegally terminated from service during his
probation period, as this period was wrongly extended beyond what was
permissible in the Standing Orders. This is what was said by this Court in
Paragraph 11:
"11. The special agreement, in so far as it provides for additional four
months of probation, is an act in contravention of the Standing Order.
We have already held that. It plainly follows from Sections 4, 10 and
13(2) that the inconsistent part of the special agreement cannot prevail
over the Standing Order. As long as the Standing Order is in force,
UNION OF INDIA & ORS. v. K. SURI BABU
[SUDHANSHU DHULIA, J.]
1054
SUPREME COURT REPORTS
[2023] 15 S.C.R.
it is binding on the Company as well as the workmen. To uphold the
special agreement would mean giving a go-by to the Act's principle of
three-party participation in the settlement of terms of employment. So
we are of the opinion that the inconsistent part of the special agreement
is ineff ective and unenforceable."
In Sudhir Chandra Sarkar (supra) it was ultimately held by this Court
that the terms of a statutory contract of service was illegal because it denied
gratuity to an employer which was against the Standing Orders that were
legally binding on the employer.
10. Standing Orders are defi ned under Section 2(g) of the 1946 Act
as under:
"2(g) "standing orders' means rules relating to matters set out in the
Schedule"
In the schedule to the 1946 Act, a whole list of topics is given which
are related to workman, such as classifi cation of workmen, their attendance,
closing and reopening of the industrial establishment to suspension or
dismissal for misconduct and as to what constitutes misconduct, etc.
The 1946 Act mandates under Section 3 that the employer shall
submit before the certifying offi cer, draft standing orders proposed by him,
for adoption in his industrial establishment. The draft standing orders after
scrutinization under Section 4 of the 1946 Act are fi nally certifi ed under
Section 5 of the 1946 Act.
The standing orders are then notifi ed under Section 7 of the Act, when it
becomes eff ective. However, before these standing orders are notifi ed under
Section 7, it may go through a quasi-judicial process, as any party aggrieved
by any provisions of the standing orders has a right to appeal under Section
6 of the 1946 Act before the Appellate Authority. The standing orders which
are fi nally notifi ed are then prominently posted by the employer in English
as well as in the language understood by the majority of the workmen.
Section 10 of the 1946 Act provides that the standing orders shall not be
modifi ed except by agreement between the parties within six months of the
certifi cation or the last modifi cation of the Standing Orders. The Standing
Order which the workman/respondent claims in the present case have gone
1055
through the above process and there is no order under Section 10 of the 1946
Act which modifi es the Standing Order applicable herein.
11. A standing order is hence no ordinary order. It has a statutory
mandate. The 1946 Act mandates all owners of industrial establishments
which are employing 100 or more workmen to prepare standing orders
which should cover all matters relating to employment of a workman which
have been given in the schedule of the 1946 Act and then these standing
orders further need to be certifi ed by the authority under the 1946 Act. The
objective and purpose of the 1946 Act was to have a certainty in service
conditions of workmen and a responsibility was placed upon the employer
to formulate fair conditions of industrial employment, including in its
disciplinary proceedings against a workman. In other words, standing orders
are a set of Rules which have to be strictly followed and cannot be ignored,
modifi ed or changed, except in accordance with law.
12. The CCA Rules, 1965 on the other hand were framed under the
proviso to Article 309 of the Constitution of India which are applicable to
employees of Central Government. The CCA Rules, 1965 are not specifi c
to workmen as these are general service rules applicable to all employees
who work under the Central Government. These are not workman specifi c
Rules, unlike the standing orders. Rule 3 of the CCA Rules, 1965 provides
for the applicability of the Rules, which reads as under:
"3. Application.- (1) These rules shall apply to every government
servant including every civilian Government servant in the Defence
Services, but shall not apply to-
(a) any railway servant, as defi ned in rule 102 of Volume I of the Indian
Railway Establishment Code,
(b) any member of the All India Services.
(c) any person in casual employment,
(d) any person subject to discharge from service on less than one
month's notice,
(e) any person for whom special provision is made, in respect of matters
covered by these rules, by or under any law for the time being in force
or by or under any agreement entered into by or with the previous
UNION OF INDIA & ORS. v. K. SURI BABU
[SUDHANSHU DHULIA, J.]
1056
SUPREME COURT REPORTS
[2023] 15 S.C.R.
approval of the President before or after the commencement of these
rules, in regard to matters covered by such special provisions.
(2) Notwithstanding anything contained in sub-rule (1), the President
may by order exclude any class of Government servants from the
operation of all or any of these rules.
(3) Notwithstanding anything contained in sub-rule (1), or the
Indian Railway Establishment Code, these rules shall apply to every
Government servant temporarily transferred to a Service or post
coming within exception (a) or (e) in sub-rule (1), to whom, but for
such transfer, these rules would apply.
(4) If any doubt arises-
(a) whether these rules or any of them apply to any person, or
(b) whether any person to whom these rules apply belongs to a
particular Service.
the matter shall be referred to the President, who shall decide the same.
13. The standing orders, on the other hand, as we have seen, cover
a whole range of activities of work related to a workman in an industrial
establishment which not only includes his working hours, the facilities to be
given to a workman, his duties and responsibilities but even minor activities
of a workman in an industrial establishment. There is hardly any area which
is not covered under these standing orders. Another important feature of the
standing orders is that it is totally focused on the activities, nature of work
of a workman and the treatment he deserves vis-a-vis the employer and the
duties towards his employer. All these are comprehensively laid down. The
CCA Rules, 1965 do not comprehensively cover the service conditions of
a workman as a standing order does.
14. The purpose and the scope of 1946 Act is explained best in the
words of Justice O. Chinnappa Reddy in U.P. State Electricity Board and
Another v. Hari Shankar Jain and Others, AIR 1979 SC 65, which held
as under:
"6. Let us now examine the various statutory provisions in their
proper context with a view to resolve the problem before us. First,
1057
the Industrial Employment (Standing Orders) Act, 1946. Before the
passing of the Act, conditions of service of industrial employees were
invariably ill-defi ned and were hardly ever known with even a slight
degree of precision to the employees. There was no uniformity of
conditions of service for employees discharging identical duties in the
same establishment. Conditions of service were generally ad-hoc and
the result of oral arrangements which left the employees at the mercy
of the employer. With the growth of the trade union movement and the
right of collective bargaining, employees started putting forth their
demands to end this sad and confusing state of aff airs. Recognising the
rough deal that was being given to workers by employers who would
not defi ne their conditions of service and the inevitability of industrial
strife in such a situation, the legislature intervened and enacted the
Industrial Employment (Standing Orders) Act. It was stated in the
statement of objects and reasons:
"Experience has shown that 'Standing Orders', defi ning the
conditions of recruitment, discharge, disciplinary action,
holidays, leave etc., go a long way towards minimising friction
between the management and workers in industrial undertakings.
Discussion on the subject at the tripartite Indian Labour
Conferences revealed a consensus of opinion in favour of
legislation. The Bill accordingly seeks to provide for the framing
of 'Standing Orders' in all industrial establishments employing
one hundred and more workers."
It was, therefore, considered, as stated in the preamble "expedient to
require employers in industrial establishments to defi ne with suffi cient
precision the conditions of employment under them and to make the
said conditions known to workmen employed by them". The scheme
of the Act, as amended in 1956 and as it now stands, requires every
employer of an industrial establishment as defi ned in the Act to submit
to the Certifying Offi cer draft Standing Orders, that is, "Rules relating
to matters set out in the Schedule", proposed by him for adoption
in his industrial establishment. This is mandatory. It has to be done
within six months after the commencement of the Act. Failure to do
so is punishable and is further made a continuing off ence. The draft
UNION OF INDIA & ORS. v. K. SURI BABU
[SUDHANSHU DHULIA, J.]
1058
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Standing Orders are required to cover every matter set out in the
schedule. The Schedule enumerates the matters to be provided in the
Standing Orders and they include classifi cation of workmen, shift
working, attendance and late coming, leave and holidays, termination
of employment, suspension or dismissal for misconduct, means of
redress for wronged workmen etc. Item 11 of the Schedule is "Any
other matter which may be prescribed". By a notifi cation dated
November 17, 1959 the Government of Uttar Pradesh has prescribed
"Age of superannuation or retirement, rate of pension or any other
facility which the employer may like to extend or may be agreed upon
between the parties" as a matter requiring to be provided in the
Standing Orders. On receipt of the draft Standing Orders from the
employee, the Certifying Offi cer is required to forward a copy of the
same to the trade union concerned or the workmen inviting them to
prefer objections, if any. Thereafter the Certifying Offi cer is required
to give a hearing to the employer and the trade union or workmen
as the case may be and to decide "whether or not any modifi cation
of or addition to the draft submitted by the employer is necessary to
render the draft Standing Orders certifi able under the Act". Standing
Orders are certifi able under the Act only if provision is made therein for
every matter set out in the schedule, if they are in conformity with the
provisions of the Act and if the Certifying Offi cer adjudicates them as
fair and reasonable. The Certifying Offi cer is invested with the powers
of a civil court for the purposes of receiving evidence, administering
oaths, enforcing the attendance of witnesses etc. etc. The order of the
Certifying Offi cer is subject to an appeal to the prescribed Appellate
Authority. The Standing Orders as fi nally certifi ed are required to be
entered in a register maintained by the Certifying Offi cer. The employer
is required to prominently post the Certifi ed Standing Orders on special
boards maintained for that purpose. This is the broad scheme of the
Act. The Act also provides for exemptions. About that, later. The Act, as
originally enacted, precluded the Certifying Offi cer from adjudicating
upon the fairness or reasonableness of the Draft Standing Orders
submitted by the employer but an amendment introduced in 1956 now
casts a duty upon the Certifying Offi cer to adjudicate upon the fairness
or reasonableness of the draft Standing Orders. The scheme of the Act
1059
has been suffi ciently explained by this Court in Associated Cement Co.
Ltd. v. P.D. Vyas [AIR 1960 SC 665 : (1960) 2 SCR 974 : (1960) 1 LLJ
563 : 20 FJR 59] , Rohtak Hissar District Electricity Supply Co. Ltd. v.
State of U.P. [AIR 1966 SC 1471 : (1966) 2 SCR 863 : (1966) 2 LLJ 330
: 29 FJR 76] , and Western India Match Co. Ltd. v. Workmen [(1974) 3
SCC 330 : 1973 SCC (L&S) 531 : (1974) 1 SCR 434] . The Industrial
Employment (Standing Orders) Act is thus seen to be an Act specially
designed to defi ne the terms of employment of workmen in industrial
establishments, to give the workmen a collective voice in defi ning the
terms of employment and to subject the terms of employment to the
scrutiny of quasi-judicial authorities by the application of the test of
fairness and reasonableness. It is an Act giving recognition and form
to hard-won and precious rights of workmen. We have no hesitation
in saying that it is a special Act expressly and exclusively dealing
with the schedule-enumerated conditions of service of workmen in
industrial establishments."
(emphasis supplied)
Thus, it was held in Hari Shankar Jain (supra) that the Industrial
Employment (Standing Orders) Act is a special act under which Standing
Orders are laid down which deals with specifi c conditions of a workman in
an "industrial establishment", and the hard won right of a workman cannot
be taken away by a general enactment such as CCA Rules, 1965.
"10. We have already shown that the Industrial Employment (Standing
Orders) Act is a special Act dealing with a specifi c subject, namely
the conditions of service, enumerated in the schedule, of workmen in
industrial establishments. It is impossible to conceive that Parliament
sought to abrogate the provisions of the Industrial Employment
(Standing Orders) Act embodying as they do hard-won and precious
rights of workmen and prescribing as they do an elaborate procedure,
including a quasi-judicial determination, by a general, incidental
provision like Section 79(c) of the Electricity (Supply) Act. It is obvious
that Parliament did not have before it the Standing Orders Act when
it passed the Electricity Supply Act and Parliament never meant that
the Standing Orders Act should stand pro tanto repealed by Section
79(c) of the Electricity Supply Act. We are clearly of the view that
UNION OF INDIA & ORS. v. K. SURI BABU
[SUDHANSHU DHULIA, J.]
1060
SUPREME COURT REPORTS
[2023] 15 S.C.R.
the provisions of the Standing Orders Act must prevail over Section
79(c) of the Electricity Supply Act, in regard to matters to which the
Standing Orders Act applies."
15. The NFC was established in the 1970s as a unit of department
of Atomic Energy, Government of India. The management of NFC after
its establishment, in the capacity of an employer submitted draft Standing
Orders under Section 3 of the 1946 Act before the certifying offi cer which
was duly certifi ed on 27th August, 1973, and thereafter notifi ed. These
Standing Orders are applicable to all industrial employees of NFC Hyderabad
who are workmen as defi ned under the 1946 Act. There is no doubt that the
private respondents come under the defi nition of workman. Clauses 38 to 44
of the Standing Orders certifi ed for the NCF-Hyderabad in 1973 provided
for misconduct, disciplinary action, penalties, procedure, appeal and review.
It is, however, true that the Ministry of Labour, Government of India
had issued an OM dated 29th July, 1977 where it had clarifi ed that wherever
Section 13B of the 1946 Act was applicable for the establishments, the
standing orders need not be certifi ed any longer and in case they have
already been certifi ed they would become invalid. All the same, the High
Court of Andhra Pradesh in its impugned order correctly makes a distinction
here which is that whereas for the Madras Atomic Power Project (similarly
constituted as NFC-Hyderabad) there is an exclusionary clause in terms
of Section 13B of the 1946 Act in its Standing Orders but in the Standing
Orders certifi ed for NFC-Hyderabad, there is no mention of Section 13-B
of the 1946 Act.
16. It is also true that in the present case, both the private respondents
when they were given employment, their appointment orders clearly said
that their service conditions, including disciplinary proceedings, if any,
would be governed under the CCA Rules, 1965. Therefore, the case of the
employer is that disciplinary proceedings also have to be initiated under
the CCA Rules, 1965 and the standing orders will have no applicability in
the present case.
The employer also relies upon Section 13B of the 1946 Act, which
reads as follows:
"13B. Act not to apply to certain industrial establishments.-Nothing
in this Act shall apply to an industrial establishment in so far as the
1061
workmen employed therein are persons to whom the Fundamental
and Supplementary Rules, Civil Services (Classifi cation, Control and
Appeal) Rules, Civil Services (Temporary Services) Rules, Revised
Leave Rules, Civil Service Regulations, Civilians in Defence Service
(Classifi cation, Control and Appeal) Rules or the Indian Railway
Establishment Code or any other rules or regulations as may be
notifi ed in this behalf by the appropriate Government in the Offi cial
Gazette, apply."
Relying on the above provision, the argument of the employer is that
the 1946 Act will not apply to an industrial establishment, if for the industrial
establishment CCA Rules, 1965 have been made applicable, and since the
CCA Rules, 1965 have been made applicable and it was specifi cally stated
in the appointment orders of the respondents, the standing orders will have
no application.
17. Section 13B of the 1946 Act declares that to those workmen in an
industrial establishment to whom the CCA Rules, 1965 are applicable, the
provisions of the 1946 Act will not apply. The question which still remains
is whether in order to oust the 1946 Act a separate notifi cation under Section
13 B would be necessary as Section 13 B speaks of "...as may be notifi ed in
this behalf by the appropriate Government in the Offi cial Gazette, apply".
The Andhra Pradesh High Court, in the impugned judgment, though is
of the opinion that there is some ambiguity in Section 13B of the 1946 Act
as to whether a separate notifi cation is required for only unspecifi ed rules
mentioned in Section 13B or will a separate notifi cation also be necessary
for the specifi ed Rules such as CCA Rules, 1965. All the same, this question
has been answered to a large extent by this Court in Hari Shankar Jain
(supra). The question before this Court was whether the standing orders
would be applicable to a workman or will it be the regulations framed under
the Electricity Supply Act, 1948. In the said case, there were standing orders
for the workmen, who were working for the U.P. State Electricity Board (as
it was then), but subsequently a notifi cation was issued by the Government
of India on 28th May, 1970 specifi cally under Section 13B of the 1946 Act.
The notifi cation read as under:
"In pursuance of the provision of Section 13-B of the Industrial
Employment (Standing Orders) Act, 1946 (Act No. 20 of 1946), the
UNION OF INDIA & ORS. v. K. SURI BABU
[SUDHANSHU DHULIA, J.]
1062
SUPREME COURT REPORTS
[2023] 15 S.C.R.
Governor is pleased to notify in the offi cial Gazette that the U.P.
State Electricity Board has made the following Regulations under
sub-section (c) of Section 79 of the Electricity (Supply) Act, 1948 (Act
No. 54 of 1948):
Notwithstanding any rule if an order or practice hitherto followed,
the date of compulsory retirement of an employee of the Board will
be the date on which he attains the age of 58 years; provided that-
(i) in the case of the inferior servants of the Board, whose
counterparts under State Government are at present entitled to serve
up to the age of 60 years, the age of compulsory retirement will be the
date on which they attain the age of 60 years.
(ii) the Board or its subordinate appointing authority may require
an employee to retire after he attains or has attained the age of 55
years on three months' notice or three months' salary in lieu thereof
without assigning any reason."
We have also noticed that in the above case, there was a specifi c
notifi cation under Section 13B of the 1946 Act, which admittedly is not
there in the case at hand. What is important is that the notifi cation (in the
above case), was not of a general nature but it was specifi c to "compulsory
retirement", of employees of the Electricity Board. An employee was to
be compulsory retired after attaining the age of 58 years, subject to certain
provisions. This Court held that essentially the Regulations, made under the
Electricity Supply Act are of a general nature, and the Standing Orders are
the special rules. Therefore, the special rules would override the general.
Nevertheless, since there is also an exclusion clause under Section 13B of
the 1946 Act and there was indeed a notifi cation under the said Act which
we have already referred above, it will be the regulations made under the
1948 Act which will be applicable, but only so far as it relates to compulsory
retirement, since the notifi cation dated, 28th May, 1970 was only limited to
compulsory retirement. It has been held as under:
"17. ... In our view the only reasonable construction that we can put
upon the language of Section 13-B is that a rule or regulation, if notifi ed
by the Government, will exclude the applicability of the Act to the extent
that the rule or regulation covers the fi eld. To that extent and to that
1063
extent only 'nothing in the Act shall apply'. To understand Section 13-B
in any other manner will lead to unjust and uncontemplated results.
For instance, most of the Service Rules and Regulations expressly
mentioned in Section 13-B do not deal with a large number of the
matters enumerated in the schedule such as 'Manner of intimating
to workmen periods and hour of work, holidays, pay-days and wage
rates', 'shift working', 'Attendance and late coming", 'conditions of,
procedure in applying for, and the authority which may grant leave
and holidays', 'Closing and reopening of sections of the industrial
establishments and temporary stoppages of work and the rights and
liabilities of the employer and workmen arising therefrom, etc. To
exclude the applicability of Standing Orders relating to all these
matters became the Fundamental Rules, the Civil Service Rules or the
Civil Services Control, Classifi cation and Appeal Rules provide for a
few matters like 'Classifi cation of workmen' or 'suspension or dismissal
for misconduct' would be to reverse the processes of history, apart
from leading to unjust and untoward results. It will place workmen
once again at the mercy of the employer be he ever so benign and
it will certainly promote industrial strife. We have indicated what
according to us is the proper construction of Section 13-B. That is
the only construction which gives meaning and sense to Section 13-B
and that is a construction which can legitimately be said to conform
to the Directive Principles of State Policy proclaimed in Articles 42
and 43 of the Constitution."
It, then, went on to hold as further:
"18. We, therefore, hold that the Industrial Employment (Standing
Orders) Act is a special law in regard to the matters enumerated in
the schedule and the regulations made by the Electricity Board with
respect to any of those matters are of no eff ect unless such regulations
are either notifi ed by the Government under Section 13-B or certifi ed
by the Certifying Offi cer under Section 5 of the Industrial Employment
(Standing Orders) Act.