# SARAN, BIHAR v. THEIR WORKMEN° REPRESENTED BY CHINI

- **Citation:** [1960] 3 S.C.R. 214
- **Court:** Supreme Court of India
- **Decided:** 1957-01-29
- **Case number:** Civil Appeal No. 402 of 1958
- **Bench:** P. B. Gajendragadkar Andk. N. Wanchoo
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/saran-bihar-v-their-workmen-represented-by-chini-1836
- **Pages:** 7

## Headnote

Industrial Dispute-Reference by State Governmcnt-Competence-C ontrolled industry -
"Appropriate Government," meaning
of-Industries (Development and Regulation) Act, r95r (65 of r95r).
-Industrial Disputes Act, I947 (r4 of r947), s. z (a) (i).
A dispute relating to a workman in the appellant sugar mill,
situate in Bihar, was raised by the Workers Union and a reference was made by the State Government. Under s. 2 (a) (i) of
the Industrial Disputes Act, 1947, "'Appropriate Government'
means in relation to any industrial dispute concerning any industry carried on by or under the authority of the Central Government.: .... or concerning any such controlled industry as may be .
specified in this behalf by the Central Government.. .... the
Central Government". The question was whether the State
Government was competent to make the reference, as sugar was
a controlled industry under the Industries (Development and
Regulation) Act, 195I.
Held, that in order that the appropriate government under
s. 2 (a) (i) of the Industrial Disputes Act, 1947, may be the
Central Government for a controlled industry it is necessary that
such controlled industry should be specified by the Central
Government, and that in the absence of a notification for the
.....
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•
3 S.C.R. SUPREME COURT REPORTS
~15
·purposes of s. 2 (a) (i) of the Act, the State Government was.
competent to make the reference.
.
The Bijoy Cotton Mills Ltd. v. Their Workmen and Another
[1960] 2 S.C.R. 982, followed.

## Text

214
SUPREME COURT REPORTS
[1960]
z960
based on mere surmises and is entirely opposed to the
. .
. weight of evidence adduced in this case.
Tea D"'''.'1'.
The result is that that portion of the award which
Labou1' Association .
d.
.
.
v.
issues
irect10ns to the appellant on the basis that
Their
the closure, in the eyes of law, had not taken place is
Ex-Employees
set aside. The appeal succeeds to that extent and
must be allowed. There will be no order as to costs in
. ,.
Gojendragadkar J. the circumstances.
z960
March 9.
Appeal allowed.
MANAGEMENT OF VISHNU SUGAR MILLS
LIMITED, HARKHUA, DISTRICT
SARAN, BIHAR
v.
THEIR WORKMEN° REPRESENTED BY CHINI
MILL MAZDOOR UNION, HARKHUA, DIST.
SARAN, BIHAR
(P. B. GAJENDRAGADKAR ANDK. N. WANCHOO, JJ.)
Industrial Dispute-Reference by State Governmcnt-Competence-C ontrolled industry -
"Appropriate Government," meaning
of-Industries (Development and Regulation) Act, r95r (65 of r95r).
-Industrial Disputes Act, I947 (r4 of r947), s. z (a) (i).
A dispute relating to a workman in the appellant sugar mill,
situate in Bihar, was raised by the Workers Union and a reference was made by the State Government. Under s. 2 (a) (i) of
the Industrial Disputes Act, 1947, "'Appropriate Government'
means in relation to any industrial dispute concerning any industry carried on by or under the authority of the Central Government.: .... or concerning any such controlled industry as may be .
specified in this behalf by the Central Government.. .... the
Central Government". The question was whether the State
Government was competent to make the reference, as sugar was
a controlled industry under the Industries (Development and
Regulation) Act, 195I.
Held, that in order that the appropriate government under
s. 2 (a) (i) of the Industrial Disputes Act, 1947, may be the
Central Government for a controlled industry it is necessary that
such controlled industry should be specified by the Central
Government, and that in the absence of a notification for the
.....
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-
•
3 S.C.R. SUPREME COURT REPORTS
~15
·purposes of s. 2 (a) (i) of the Act, the State Government was.
competent to make the reference.
.
The Bijoy Cotton Mills Ltd. v. Their Workmen and Another
[1960] 2 S.C.R. 982, followed.
CIVIL APPELLATE JURISDICTION:
Civil Appeal
No. 402 of 1958.
Appeal by special leave from the Award dated
January 29, 1957, of the Industrial Tribunal, Bihar,
at Patna in Reference No. 7 of 1956.
Sukumar Ghose, for the appellant.
M. K. Ramamurthi, R. K. Garg, A. N. Nag and
Buresh Aggarwal, for the respondents.
S. P. Varma, for the intervener (State of Bihar).
1960. March 9. The Judgment of the Court was
delivered by
WANCHOO, J.-This is an appeal by special leave
against the award of the Industrial Tribunal, Patna.
The appellant is a Sugar Mill in District 8aran in the
State of Bihar. One Ramkrishna Prasad was appointed as clerk in this mill in 1933. Gradually, he work"
ed his way up an:d was drawing Rs. 140 per month in
October 1952. The mill created a new post of store
in-charge about that time as the work in the Stores
Department of the Mill had increased. On October 4,
1952, Babulal Parekh was appointed to this new post
on a consolidated salary of Rs. 180 per mensem. A
letter of appointment was issued to him on that. date
and he was told that he would be on probation for one
year. He was also asked by another letter to. take
charge immediately. He took charge on October 7,
1952. On November 28, 195,2, an order was passed by
the mill distributing the duties between the various
clerks employed in the Stores Department and it was
stated therein that all the staff of the Stores Department would work as subordinate to Babula! Parekh.
On December 2, 1952, another order was passed by
which Ramkrishna Prasad was ordered to hand over
the keys of the stores to Babula! Parekh. Thereafter
Ramkrishna Prasad made a representation against
his being made subordinate to the stores in-charge .
. This representation was rejected. A dispute was then
raised by the union and a reference was made by th~.
Government of Bihar on May 9, .1956, in which the
Vishnu Sugar
Mills Ltd.
v.
Their W orkinen
Wanshoo ].
Vishnu Sugar
Mills Ltd.
v.
Their Workmen
Wanchoo ].
216
SUPREME COURT REPORTS
[1960)
following three matters were referred to the tribu- ·
nal:-
1.. Whether the status of workman, Sri Ramkrishna Prasad, Store-keeper, and the nature of the
job performed by him has been changed to his prejudice with the appointment of a separate store incharge;
2. Whether in view of the satisfactory performance of duties of store-keeper for the last 20 years
by the above-named workman, it was at all necessary to appoint a separate store in-charge over him
with higher emoluments and whether Shri Ramkrishna Prasad is entitled to be appointed to the
post of store in-charge; and
3. Whether the claim of ·the above-named workman for promotion to higher grades has been overlooked by the management, and 'if so, what relief
the workman is entitled to.
When the matter came up before the tribunal, the
main contention on behalf of the mill was that it was
exclusively the management function to decide its
labour strength, both qualitatively and quantitatively,
and that so far as Ramkrishna Prasad was concerned
his position had not been prejudicially affected by the
creation of the new post of a store in-charge. The
workmen on the other hand contended that Babula!
Parekh was first appointed as a mere clerk under
Ramkrishna Prasad to begin with and it was only on
November 28, 1952, that he was promoted over the
head of Ramkrishna Prasad as a store in-charge, thus
superseding Ramkrishna Prasad. This stand of the
workmen was controverted by the mill and its case
was that Babula! Parekh was from the very beginning
appointed as store in-charge.
The tribunal came to the conclusion after a consideration of the evidence produced that Babula! was
first appointed as an ordinary clerk in the Stores
Department and was subsequently made a store incharge. It held that this caused reasonable heart
burning to Ramkrishna Prasad. The tribunal was
conscious of the principle that promotion to a higher
post was the exclusive fnnction of the management
and should not ordinarily be interfered with.
But
. ,•
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{
J ' ,
' t
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3 S.C.R. SUPREME COURT REPORTS
217
in spite of that it was of the view that. this was a fit
case for interference ; but on other considerations
which were not specified in the order by the tribunal
it held that it would not interfere with the arrangement made by the mill; it instead granted an increment of Rs. 30 per month from the date of its order
to Ramkrishna Prasad to meet the ends of justice. It
is this order which is being challenged before us.
Two points have be.en urged before us on behalf of
the appellant. In the first place it is urged that the
reference was incompetent as sugar was a controlled
industry and only the Central Government could have
made the reference and not the State Government.
Secondly, it is urged that the order of the tribunal
granting an increment of Rs. 30 per month to Ramkrishna Prasad was patently perverse and that there
was no change in the status or emoluments of Ramkrishna Prasad by the creation of the new post and
the employment of Babula! Parekh on it.
So far as the question of the. competence of the
reference is concerned, we are of opinion that there is
no force in it. A similar question was raised before
this Court in The Bijoy Cotton Mills Ltd. v. Their
Workmen and Another (1) and it was held there on the
language of s. 2(a)(i) of the .Industrial Disputes· Act,
1947, that before tl;i.at provision could apply to a controlled industry there must be a notification by the
Central Government for the purposes of s. 2(a)(i) of the
Industrial Disputes Act. Section 2(a)(i) is in these
terms-
"' Appropriate Government' means in relatipn
to any industrial dispute concerning any industry
carried o:ri by or under the authority of the Central
Government or by a railway company or concerning
any such controlled industry as may be specified in
this behalf by the Central Government, or in relation to an industrial dispute concerning a banking
or an insurance company, a mine, an oil-field or a
major port, the Central Government. "
The argument is that as sugar is a controlled industry
under the Schedule to the Industries (Development
and Regulation} Act, No. 65 of 1951, the appropriate
(1) [196o] 2 S.C.R. 982.
as
rg6o
Vishnu Suga,
Mills Ltd.
v.
Thefr Workmen
Wanchoo ].
r960
Vishnu Sugar
Mills Ltd.
v. -
Their Workmen
Wanchoo ].
218
SUPREME COURT REPORTS
[1960)
Government fw the purposes ofs. 2(a)(i) with reference
to the sugar Industry is the Central Government.
Reliance is placed on the words "concerning any such
controlled industry as may be specified in this behalf
by the Central Government" appearing in s. 2 (a)(i).
It is true that sugar is a controlled industry
under the Industries (Development and Regulation)
Act, 1951, but that in our opinion does not conclude
the matter. In order that the appropriate government under s. 2(a)(i) may be the Central Government
for a controlled industry, it is necessary that such controlled industry should be specified by the Central
Government for the purposes of s. 2(a)(i).
This in our
opinion is obvious from the words "controlled industry as may be specified in this behalf by the Central
Government" appearing in s. 2(a)(i). It is not enough
that an industry should be a controlled industry to
attract this provision of s. 2(a)(i); it is further necessary that it should be specified in this behalf, namely
for the purposes of s. 2(a)(i), as a controlled industry
by the Central Government, before the Central
Government can become the appropriate government
within the meaning of s. 2(a)(i). We may in this
connection refer to Firebricks and Potteries Ltd., etc. v.
Firebricks and Potteries Ltd. Workers Union Ltd. (1)
where the same view has been taken. We are of
opinion that that is the correct meaning of these
words appearing in s. 2(a)(i), as already held in The
Bijoy Cotton Mills Ltd. ('). The objection that the
reference was not competent therefore fails.
We next come to the contention raised on behalf of
the mill that there was in fact no prejudice w hatsoever so far as the status and emoluments of Ramkrishna Prasad were concerned by the creation of the
new post and the appointment of Babula] Parekh on
it, and that the tribunal was not justified in any case
in granting an increment of Rs. 30 per mensem to
Ramkrishna Prasad. The main consideration which
influenced the tribunal in passing the order which it
did was that in the view of the tribunal Ramkrishna
Prasad was superseded by Babula! Parekh who was
first appointed as a clerk under him. This view of
(1) I.L.R. [1955] Mys. 546.
(2) [1960] 2 S.C.R. 98>.
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3 S.C.R. SUPREME COURT REPORTS
219
the tribunal in our opinion is patently erroneous. The
appointment order dated October 4, 1952, clearly
shows that Babula! Parekh was appointed as store incharge from the very beginning at Rs. 180 per month.
The tribunal referred to certain entries in the attendance register to hold that Babula! Parekh w0rked as
clerk to begin with. It appears from the attendance
register for the months of October, November and
December that Babula! Parekh was marked present
from October 7 to November 9. Thereafter from
November II to the end of December he signed the
attendance register. The statement of Chaudhari,
Labour Welfare Officer, of the mill was that the
practice in the mill was that officers
used to
be marked present in
the
attendance register
while clerks used to sign it themselves.
The
tribunal has concluded from the fact that Babulal
Parekh signed the register in November that. he must
have been a clerk to begin with. The tribunal,
however, completely overlooked that from October
7 to November 9, Babulal Parekh was marked present
which would show that he was not a clerk. The
tribunal also overlooked that even from November 28
to the end of December when Babulal Parekh
admittedly was not a clerk but store in--charge he still
signed the register, though he should have been
marked present. Chaudhari was unable to explain
how this happened, but he was hardly the person to
explain thif'!. It is, however, clear from this confusion
that no importance can be attached to whether Babula! Parekh was marked present in the register or
signed it. The real thing which determined the status
of Babula! Parekh was the appointment order dated
October 4, 1952, which the tribunal has accepted as
correct. A question was certainly put to Chaudhari
at the end of his cross-examination that he had
manufactured the statements put in by him only the
night before but he denied it. We cannot accept the
suggestion on behalf of the respondents that the
appointment order was ante-dated, for no such·suggestion was made to Chaudhari and the tribunal itself
does not find so. It is clear therefore that the finding
of the tribunal that Babula! Parekh was appointed as
z960
Vishnu Sugar
Mills Ltd.
v.
Their Workmen
Wanchoo ].
Vishnu Suga1'
Mills Ltd.
v.
Their Workmen
Wanchoo J.
220
SUPREME COURT REPORTS
[1960]
clerk uuder Ramkrishna Prasad to begin with is
patently perverse and it must be held that Babulal
Parekh was from the very beginning working as store
in-charge. Now in so far as Ramkrishna Prasad was
concerned his work and emoluments remained the
same after the appointment of Babulal Parekh. If a
higher post was created in the Stores Department
because of the increase in work, Ramkrishna Prasad
could not claim promotion to it merely because he
was working as a store-keeper before. There is of
course no question of supersession in this case and
therefore there is no reasonable cause for any heart
burning. As the learned tribunal itself points out,
"promotion to higher post was the exclusive function
of the management" and if a new post is created and
a new man appointed, as in this case, it cannot be
said that Ramkrishna Prasad's status was in any way
prejudicll-lly affected.' It is also remarkable that after
saying all that it could in favour of Ramkrishna
Prasad the tribunal did not interfere with the arrangement made by the mill for reasons which were not
specified by it in the order.
As such there was no
reason for granting an increment of Rs. 30 per mensem
to Ramkrishna Prasad, for even the workmen did not'
claim that he was entitled to any compensation in the
shape of an increment in his pay because of the
appointment of Babula! Parekh. The order of the
tribunal therefore is patently unsupportable and must
be set aside. We therefore allow the appeal and set
aside the order of the tribunal and hold that no relief
is due to Ramkrishna Prasad. In the circumstances
we pass no order as to costs.
Appeal allowed.
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