# UNITED PROVINCES ELECTRIC. SUPPLY CO. LTD., A ALLAHABAD v. T. N. CHATTERJEE

- **Citation:** [1972] 3 S.C.R. 754
- **Court:** Supreme Court of India
- **Decided:** 1972-03-13
- **Bench:** S. M. S1Kri, A. N. Grover, A. N. Ray, D. G. Palekar, M. H. Beg
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/united-provinces-electric-supply-co-ltd-a-allahabad-v-t-n-chatterjee-5611
- **Pages:** 16

## Headnote

B
Industrial Employmen~ (Standing Orders) A.ct, 1946, s. 4 and $chedule items 8, 9 and 'UC and U.P. Industrial Employment (Standing
Orders) Rules, 1946-Model S/llnding Orders, para 13-A.pp/icability of
Standing Order re : age of retirement to emp/oYees 1'n service before the · C
certifying of St~mding Orders--Framing .of Standing Order regarding retirement before amendment, of
Schf!dule--Certifying Officer, J' could
-certify the standirig ·order a.s• fair or reasonable before ame
men~ of
s. 4-High Court der:iding question and remanding-When operates as
res judicata.
·
·In accordance with the provisions
of the . Industrial
Employm~nt D
(Standing Orders) Act, 1946, and the U.P. Industrial Employment-(Sianding Orders) Rules, 1946, the appellant submitted draft standing orders.
defining the conditions. Qf employment of its employees and they W'!re
certified by (he Certifying Offirer in 1951. Clause 32 of the Standing
Orders provided that an employee who b~s served 30 years or who has ·
reached the age of 55 years will be retired, but, exemption from t):iis may
be granted by the company in special case. In 1959, notices were served
on the respondent-workmen that they were retired by- reason of their bav·
:E .
ing attained the age of superannuation ..s per cl.· 32. The workmen contended that the clause was not binding or enfor"'iable as far as tbev were
concerned, because, they bad entered the 9'rvice of the appellant prior
to the c~rtification of the Standing Orders '3Dd there was no condition
that they would be liable to retirement after attaining any prescribed age
or any fixed period of service, and that they were entitled to continue in
service as long as they were physically fit.
TOO industrial dispute was
referred to the Industrial Tnbu!l'.li and the Tribunal held in favoulr of
F
the appellant. The respondents filed a writ petition in the High Court.
They also applied in 1960, under s. 10(2) of the Industrial Employment
(Standing Orders) Act, 1946, for amendment and modification of cl. 32
claiming fixation of retirement age at 60. The Certifying Offil:er modi·
tied the clause and fixed the age of retirement <1t 58, but the appellate
authority refixed it at 55.
·
The High Cour~ in the writ petition, on the basis, of the decision of
G
this Court in Guest Keen WU/iams Pvt. Ltd., [1%0) 1 S.C.R. 348 bd<I
that Cl. 32 was not applicable to the employees and directed the Tribunal
to rehear the case.
The Tribunal thereafter held that the respondent·
workmen were wrongfully and unjustifiably retired.
In appeal to this Court,
HELD : (1) It was not intended by the Legislature that .dill'eblnt H
sets of conditiol)s should apply to employees depending on whether a
workman was employed before the Standink Ord~ were ·cer!ified
or
after, as t!:iat would defeat the object of the legislation. "The obi:<\t an<!
A
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E
F
G
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U.P. E,J.ECTRIC co. v. T. N. CHATTERJEE (Grover, J.) !755
s~heme of the Act is that the employers must define precisely too cond111ons of employment of '111 the employees and have tlx:m certified by
the Certifyi":g Officer.
The right given to be workmen to e<press their
views, to raise ObJect1ons, to appeal to the
appellate authority and to
ask for modification of the Standing Orders under s. 10 of the Act, show
that every possible safeguard has teen provided in the interests of the
workmen.
Moreover, the individual items in the Schedule to the Act
show that there cannot be different conditions for different employees
depending upon the point of time when ,they came to be employed, f<lr
that would result in a great deal of hesrt burning between the employees
inter se. [762 R-H; 763 A-DJ
Salem Erode El<etriclty Distrlburion Co. Ltd. v. Its Workers;
[1966]
2 S.C.R. 498, and Agra Elecl'ric Supply Co. Ltd., v. Sri Al/adin 4c Ors.
[1970] I S.C.R. 808, followed. ·
•
(2) The decision in Guest Keen Williams Pvt. Ltd. that the Industrial
Tribunal had to consider not only the propriety, reasonableness and fairness of a Standing Ord

## Text

_Characters 0–39,609 of 44,960. This is a partial read: ask again with offset=39609 for what follows._

754
UNITED PROVINCES ELECTRIC. SUPPLY CO. LTD., A
ALLAHABAD
v.
T. N. CHATTERJEE
March 13, 1972
[S. M. S1KRI, C.J., A. N. GROVER, A. N. RAY, D. G. PALEKAR
AND M. H. BEG, JJ.]
B
Industrial Employmen~ (Standing Orders) A.ct, 1946, s. 4 and $chedule items 8, 9 and 'UC and U.P. Industrial Employment (Standing
Orders) Rules, 1946-Model S/llnding Orders, para 13-A.pp/icability of
Standing Order re : age of retirement to emp/oYees 1'n service before the · C
certifying of St~mding Orders--Framing .of Standing Order regarding retirement before amendment, of
Schf!dule--Certifying Officer, J' could
-certify the standirig ·order a.s• fair or reasonable before ame
men~ of
s. 4-High Court der:iding question and remanding-When operates as
res judicata.
·
·In accordance with the provisions
of the . Industrial
Employm~nt D
(Standing Orders) Act, 1946, and the U.P. Industrial Employment-(Sianding Orders) Rules, 1946, the appellant submitted draft standing orders.
defining the conditions. Qf employment of its employees and they W'!re
certified by (he Certifying Offirer in 1951. Clause 32 of the Standing
Orders provided that an employee who b~s served 30 years or who has ·
reached the age of 55 years will be retired, but, exemption from t):iis may
be granted by the company in special case. In 1959, notices were served
on the respondent-workmen that they were retired by- reason of their bav·
:E .
ing attained the age of superannuation ..s per cl.· 32. The workmen contended that the clause was not binding or enfor"'iable as far as tbev were
concerned, because, they bad entered the 9'rvice of the appellant prior
to the c~rtification of the Standing Orders '3Dd there was no condition
that they would be liable to retirement after attaining any prescribed age
or any fixed period of service, and that they were entitled to continue in
service as long as they were physically fit.
TOO industrial dispute was
referred to the Industrial Tnbu!l'.li and the Tribunal held in favoulr of
F
the appellant. The respondents filed a writ petition in the High Court.
They also applied in 1960, under s. 10(2) of the Industrial Employment
(Standing Orders) Act, 1946, for amendment and modification of cl. 32
claiming fixation of retirement age at 60. The Certifying Offil:er modi·
tied the clause and fixed the age of retirement <1t 58, but the appellate
authority refixed it at 55.
·
The High Cour~ in the writ petition, on the basis, of the decision of
G
this Court in Guest Keen WU/iams Pvt. Ltd., [1%0) 1 S.C.R. 348 bd<I
that Cl. 32 was not applicable to the employees and directed the Tribunal
to rehear the case.
The Tribunal thereafter held that the respondent·
workmen were wrongfully and unjustifiably retired.
In appeal to this Court,
HELD : (1) It was not intended by the Legislature that .dill'eblnt H
sets of conditiol)s should apply to employees depending on whether a
workman was employed before the Standink Ord~ were ·cer!ified
or
after, as t!:iat would defeat the object of the legislation. "The obi:<\t an<!
A
B
c
D
E
F
G
H
U.P. E,J.ECTRIC co. v. T. N. CHATTERJEE (Grover, J.) !755
s~heme of the Act is that the employers must define precisely too cond111ons of employment of '111 the employees and have tlx:m certified by
the Certifyi":g Officer.
The right given to be workmen to e<press their
views, to raise ObJect1ons, to appeal to the
appellate authority and to
ask for modification of the Standing Orders under s. 10 of the Act, show
that every possible safeguard has teen provided in the interests of the
workmen.
Moreover, the individual items in the Schedule to the Act
show that there cannot be different conditions for different employees
depending upon the point of time when ,they came to be employed, f<lr
that would result in a great deal of hesrt burning between the employees
inter se. [762 R-H; 763 A-DJ
Salem Erode El<etriclty Distrlburion Co. Ltd. v. Its Workers;
[1966]
2 S.C.R. 498, and Agra Elecl'ric Supply Co. Ltd., v. Sri Al/adin 4c Ors.
[1970] I S.C.R. 808, followed. ·
•
(2) The decision in Guest Keen Williams Pvt. Ltd. that the Industrial
Tribunal had to consider not only the propriety, reasonableness and fairness of a Standing Order but that it had also to deal with the question
as to whether a particular Standing Order could be made
applicable
to employees who had already been employed without any limit as to
age of retirement Was delivered under the unamended s. 4 of the Act,
under which the Certifying Officer or the appellate authority could · not
go into the reasonableness or fairness of the Standing Orders. But after
the amendment of the section in 1956, the Certifying Officer and the
appellate authority are bound to examine the question of fairness of the
standing orders, and therefore, there o:m· be no justifica~ioil now for not
giving effect to the p<inciple of uniforniity of conditions of servic,; which
is clearly contemplated by the provisions of the Act. [763 D-F]
(3) But d. 32 of th Standing Ord!rs as certified in 1951 _,)as not
valid and could not be binding on~ respondents, because, there was
then no item in the Schedule to the
ct covering cases of superannuation or retirement, with respect to w "ch Standing Orders col,lld be made.
[766 E-F, G-.li]
Item 8 and 9 of the Schedule deal with the termination of employment and _notice thereof, and suspension or dismi~al for miscpnduct. The
language of item 8 shows that it does not cover the case of 1 superannuation \\'hich does not depend· on any notice and which covers an e\-ent
whi~h ·is automatic and which must be given effect to without aliy volition
on the part of the employer or workmen. If tennination is to be read in a
widC:-sense as meaning 'employment coming to an end' there Was no necessity to have item 3, because,• dismissal would then be covered by termination. From paragraph 13 of the Model Standing Orders contained· in the
Schedule to the Rules it is apparent that item 8 is confined to termination
of employment by notice in writing and does not refer to superannuation or
retirement. It was only in 1959 that item 11 (C) wa• introduced in the
Schedule enabling the framing of Standing Orders in relation to the age of
retirement and superannuation. [765 F-H; 766 A-CJ
Saro; Kumar v. Orissa State Electricity B()ard, A.I.R. 1970 Orissa,
126, approved.
Management of the 'Hindu' v. Secretary Hindu O{fici! 4c National
Press Employees Union, A.LR. 1961 Mad. 107, disapproved.
(4) No assistance can be derived by the rise of the woi'd 'retire!llent'
in para, 16 of the Model Standing Orders, because, it may well refer to
1·56
SUPREME COURT REPORTS
[197,2] 3 S,C,R,
retirement under
the terms of the contract of employment entered into
between the employer and the employees, [765 A-B, El
(5) Sine>,, before !he amendment of s, 4 the Certifying Officer and
the app,llate auhority were debarred from adjudicating upon the fairness
or reasonableness of the Standing Order., the Certifying Officer at, that
time, could not certify any Standing Order on the ground that it was
reasonable or fair,
Therefo're, in 1951, when the Standing Orders were
certified, cl, 32 could not have been framed becau"" there was no irem
in the Schedule relating to superannuation and the Certifying Offic'~r could
not certify it on the ground it was fair and reasonable because he hail
no power to do so, [766 D-F]
(6)• The Certifying Officer, however, when he modified cl, 32 and
fixed the retirement age at 58 (after s, 4 was amended)
could have
validly certified such clause as modified , by him, This Court could also
give an appropriate difection with regard to fixing the age of superannuation.
In the circumstances of this case the age of superannuation
should be 58
years,
Therefore, the concerned workman should
be
deemed to have cbntinued in service of the appellant till they had attained the age of 58 yearn, [767 A-C, G-HJ
( 7) The order of the High Court in the writ petition did not finally
terminal•' the proceedings ~t all,
The proceedings were terminated only
by the award of the Industrial Tribunal after remand, Therefore, the
order of the High Court following Guest Keen William's
case did not
debar a fresh consideration of too question by virtue of the rule
or
principle of res ;udicata, [768 A-B, E-FJ
Satyadhyan Ghosal v, Smt, Deorajan Devi, ~1960], 3 S,C,R, 590,
followed,
Management, of N. Railwll)I ~o-operative Society v, Industrial Tribunal, [,1967] 2 S,C,R, 476, explained,
CIVIL APPELLATE JURISDICTION : Civil Appeal No, 1734 of
1967.
,
Appeal by Special Leave from the Award dated the May 19,
1967 of the Industrial Tribunal (I) at Allahabad in Adjudication
. Case No. 15 of 1960.
·
s, V. Gupte, D. N. Mukherjee and Gautam Banerjee, for the
appellant.
G. C. Bhattacharya and M. V, Goswami, for respolldpnts Nos.
1 and 3 to 8.
0. P. Rana, for respondent No. 9.
The Judgment of the Court was delivered by
Grover, J, This is an appeal by special leave from an award
of the Industrial Tribunal, Allahabad, dated May 19, 1967.
I
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U.P. ELECTRIC co. v. T. N. CHATTERJEE (Grover,/.) 757
The material facts may be stated.
The appellant, which is
a limited liability company and which later on went ill!to voluntary !iquidatio)l, was carrying on the business or undertaking of
generation, di&tribution and supply of electricity. One of such
undertakings was 1the Electric Supply Undertaking at Allahabad in
the State of Uttar Pradesh. Its affairs and business were being
looked after and managed by Martin Bum & Co. lJtd., Calcuttlt.
Some of the appellant's workmen in Allahabad and its surrounding area were members of Biili Mazdoor Sangh-a trade union
registered under the Indian Trade Union Act, J 926. The U.P.
State Electricity Board compulsorily acquired and took over the
assets of the appellanot's aforesaid undertaking or business with
effect from 16/17th September 1964.
In accordance with otpe provisions of the Industrial Employment (Standing Orders) Act 1946, hereinafter called the 'Aot' and
the U.P. Industrial Employment (Standing Orders) Rules 1946
the appellant submitted draft Standing Orders defining the conditions of employment of its employees. On July 14, 1951 these
D
Orders' were certified by the Certifying Officer. Clause 32 of the
-
Standing Orders was in the following terms :-
·
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F
G
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"32. RETIREMENT-An employee who has served
30 years or who has reached tile age of 55 will be retired, but exemption to thls may be granted by the Company in.special cases".
The workmen through the Bijli Mazdoor Sangh preferred an
appeal under s. 6 of the Act from the order of the Certifying
Officer to the State Industrial Tribunal which was the appellate
jjuthority under the Act. Thait appeal, however, was dismissed.
The Agra Electric Supply Co. Ltd., Agra and Benaras Electric
Light & Power Co. Ltd., Varanasi, which is the appellant in the
connected appeal (C.A. i64/6&) also got certified Standing
Orders in similar terms. These electric undertakings were also
under the management of Martin Bum & Co. Ltd. On July 16,
1959 notices were served on seven workme11 with effect from
September 1, 1959 on the ground that they had attained 'the age
of superannuation or completed 30 years of service and they
were retired by reason of their having attained the age of superannuation. Out of these workmen one of them Haider Ali died
.during the pendency of proceedings. The other six employees
have been impleaded as respond.ents Nos. 1 to 6 m the present
appeal.
According to the appellant these respondents accepted all the
accumulations due to them in respeot of Provident Fund contributions made by the appellant in respeot of .them and by themselves and were also paid gratuities credited to them in 1their res-
758
SUPREME COURT REPORTS
[1972] 2 S.C.ll.
pective Provident Fund aqcounts for their services prior to their A
becoming members of the Provident Fund.
By an order dated February 22, 1960 made under s. 4-K of
the U.P. Industrial Disputes Act 1946 the Government of U.P.
ref.erred to the Industrial Tribunal (I) at Allahabad for adjudication ari industrial dispute alleged to exist between the appelB
!ant and its workmen on the following issues :
"Wheither the employers have wrongfully and/ or unjustifiably retired their workmen,
mentioned in the
Annexure, with effect from 1st August, 1959 ? If so, to
what relief are the workmen entitled ?"
c
Respo11dents I to 6 and Haider Ali (since deceased)
were the
workmen mentioned in the Annexure. The case of the workmen before the Industrial Tribunal was that they had entered
service of the appellant prior to the certification of the Standing
Orders. At the time of their appointment there was no condition
~hat they would be liable to retirement after attaining any presD
cribed age or after putting in any fixed
period of service.
A
practice was in vogue that the workmen would continue in service
till he was physically fit.
Accordingly clause 32 of the certified
Standin_g Orders was neither bindin_g nor enforce.able.
The Industrial Tribunal made an award on May 2, 1960 finding, inter-
·alia, (a) the employers were within their rights in retiring the
E
workmen concerned.
(b) The act of the emPJoyers in compulsorily retiring the concerned workmen from service could not be
characterised as wrongful, illegal or un.iustified and ( c) the workmen were entitled to no relief.
On June 14, 1960 the Biili Mazdoor Sangh moved an appliF
cation under s. 10 (2) of the Act for amendment and modification of clause 32 claiming fixation of retirement age at 60 years.
On September 20, 1960 the Union also filed a writ petition in
the Allahabad High Court for quashing the award. On April 22.
1961 the Certifying Officer modified clause 32 and fixed the age
of retirement at 58 years. On September 10, 1961 ithe appellate
authority refixed the age of retirement at 55 years.
Similarly
G
appeals were filed by the Agra Electric Co. and the Banaras
Electric Light and Power Co. Lid. in which similar orders were · ·
made. On July 12, 1966 the High Court recorded an order
quashing the award. It was held that Standing Order 32 was
not applicable to the employees who had entered service before
the certification of the Standing Orders. The Industrial Tribunal
H
was directed to rehear the case and after giving an opportunity
to the parties of being heard give an award in accordance with
law. Finally the award against which the appeal has been brought
A
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U.P. ELECTRIC co. v. T. N. CHATTERJEE (Grover, 1.) 75'9
was given on May 19, 1967. It was held in the award that al! the
seven workmen had been wrongfully and uJijustifiably retired and
that they should be deemed to have continued in service till Sep·
tember 16, 1964 from which date they would be taken to have
been retrenched. The appellant having been taken over by the
U.P. Staite Electricity Board, it was directed that-the employers
should pay full wages from the' period August 1, 1959 to Septem·
ber 16, 1964 and retrenchment compensation within s. 25-F read
with s, 25-FF and s. 25· J of the Industrial Disputes Act, 194 7.
While deciding the writ petition the High Court relied on
three decisions of this Court for holding that where there is no
aj!,'e of superannuation prescribed for the employees of a concem
a provision in the Standing Orders certified subsequent to the d!ite
of employment regarding compulsory retirement will not be
applicable to them. The first decision is in Guest Keen,
Williams Private Ltd. v. P. 1. Sterling & Others('). In that case
after the enlorcement of the Act the industrial concem submitted
its draft Standing Orders for cevtification to the Certifying Officer.
That Officer certified the Standing Orders after giving the trade
union of workmen an opportunity to be heard and ;ifter consider·
ing their objections. The Standing Orders relating to_ retirement
provided that the workmen shall retire from the service of tlie
company on reaching the age of 55 years. The company gave
notice to forty-seven of its workmen who were over the age of 55
years retiring them and a dispute was raised about their retirement
which was ~ferred to the Tribunal for adjudication. It was ulti·
mate1y held by. the Labour Appellate Tribunal that those workmen who were in employmellt. prior to !he date of certification of
the Standing Orders would not be governed by it and their retirement was illegal.
This Court examined the scheme of the Act
including tb.e relevant provisions. Notice was taken, in particu·
Jar, of the fact that when· the Standing Orders were submitted to
the Certifving Officer all that ·he could do was to. satisfy himself
that they made provision.for other matters set out in the schedule
to the Act and that they were; otherwise in conformity · with its
provisions. Under s. 4, as it was originally enacto..,d the Certifying Officer could not adjudicate upon the fairness or reasonable·
ne~s of the provisions of the Standing Orders. This section was
subsequell'tly amended-in 1956 and the effect of the amendment
was that the Certifying Officer was enabled to adjudicate upon
the fairness or reasonableness of the provisions of the Standing
Orders. It was pointed out by the couit that the scope for enquiry before the Certifying Offi'cer prior to the amendment of
s. 4 was extremely limited. The only way in which the employees
could claim modification of the Standing Orders J21ior to the
amendment of s. 4 was by raising an industrial dispute in that
(I) [1960] l S.C.R. 348.
780
SUPREME COURT llEPO!lTS
[1972] 3 S.C.R.
behalf. Subsequent to the amendment the employees could raise
the same displl'le before 1the Certifying Officer and in a proper
case they cauld apply for its modification under s. 10(2) of the
Act. It was observed that the Standing Orders certified under the
Acit became part of the terms of the employment by operation of
s. 7 but if an industrial dispute arose in respect of such Orders and
A
it was referred to the Tribunal by the appropriate Government· B
, the Tribunal had the jurisdiction to deal with rt on ,the merits. It
was, therefore,· held that the Tribunal had to consider not only
the propriety, reasonableness and fairne~s of the rule but it had
also to deal with the question as to whether the said rule could
and should be made applicable to employees who had already
been employed without any limit as to age of retirement. The
decision in J]ljs case was fo!lo\\ed in Workmen of Kettlewell
Bullen & Co .. Ltd. v. Kettlewell Bullen & Co. Ltd. ( '). The next
case in which a similar q11.estion &rose in Salem Erode Electricity
Distribution Co. Ltd. v. Salem Erode Electricity Distribution Co.
Ltd. Empleyees Union('). It was claimed by the company
which was the employer there that the urgent need for increased
production and supply of electrical energy could be met if the
existing rules embooi.ed in two of its certified Standing Orders
relating to holidays and leave were suitably amended. The ·
amendments proposed sought to introduce different rules relating
to holidays and leave for employees wh<>. were appointed before
a specified date and those who joined service after that date. Both
the Certifying Officer and the appellate authority disallowed the
amendments.
The company appealed to this Court and th~
scheme of the AcJ_was examined once again. It was emphasised
that after the amendment of s. 4 of the Act made in 1956 jurisdiotion had been conferred on the Certifying Officer as well as
c
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the appellate authority to adjudicate upon the fairness or reasonableness of lhe provisions of the Standing Orders. Thus the
p
jurisdiction had been widened.
Moreover under s.
10(2) as
originally· enacted it 'was only the employer who could make an
application to the Certifying Officer to have the Standing Orders
modified. By the amendment made in 1956 even workmen were
enabled to exercise that right. Addressing itself to the . questiqn
whether it was permissible for an industrial establishment to have
two sets of Standing Orders to goveni the relevant terms and
G
conditions of its employees it was laid down after an examination
of !he scheme of the relevant provisions of the Act in the light of
the matters specified in the Schedule that there was no scope for
having separate Standing Orders in respect of any one of them,
It was said :-
........ the conclusion appears to be irresistible that
H
!be object of the Act is to certify Standing Orders in
(I) [1964] 2 L.L.J. 146.
(2)
[1966] 2 S.C.R. 498.
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U,P, ELECTRIC co. v. T. N. CHATTERJEE (Grover, /.) 761
respect o.f all the matters covered by the schedule and
having regard to these maMers Standing Orders so certified would be uniform and would apply to all workmen
alike who are employed in any industrial establishment".
It was considered that Guest Keen Williams Pvt. Ltd.(') could
afford no assistance because that matter came to this Court from
an industrial dispute which was the subject matter of industrial
adjudication and all that this Cclllrt did was to fixe the age of superannuation for workmen who had been employed prior to the date
of the certification of the relevant Standing Orders. That course
was· adopted in the special and unusual circumstances of that
case.
In the next decision Agra Electric Supply Co, Ltd. v. Sri
Alladin & Ors.( 2 ) one of the main questions was whether three
workmen who had been employed long before 1951 when the company's St;mding Orders were certified could be retired undet
Standing Order which prescribed the age of superannuation as
5 5 years.
This Court took a view which seemingly runs counter
-to Guest Keen Williams Pvt. Ltd.(1). lt was held that the
·Standing Orders when certified would be binding on the employers as well as all the workmen who were in ernployment at
the time the Standing Orders came into force and those employed
thereafter as uniform conditions of service.
The process of
reasoning which prevailed was ( 1 ) the Act is a beneficient piece
of legislation, its object being to require employers in industrial
establishments to define with sufficient precision the condtions of
employment of workmen employed therein and to make them
known to such workmen. ( 2) Before .the passing of the Act there
F. was nothing in law to prevent an employer having diffnferent condtracts of employment with workmen which led to co usion an
made possible discriminatory treatment. This was also clearly
incompatible with the principles of collective bargaining.
(3)
Section 3 of the Act was enacted to do away with such diversity
and. bargaining with each individual workman.
( 4) Section 4
indicates that particulars of workmen in the employment on the
date of the submission of the draft Standing Orders or certification and not of those only who could be employed in future after
certification were" to be given. ( 5) Sections 4 and 5 show that
draft orders are certifiable if they provide for all matters set out
in the schedule and are otherwi11e in conformity with the Act and
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if they are adjudicated as fair and reason~ble by the Certifying
Officer· or the appellate authoriiy. The Certifying Officer has
also to forward a copy .of the draft Standing Orders to the Union
(!) (1960] I S.C.R. 348.
(2) [1970] I S.C.R. 808.
762
SUPREME COURT REPORTS
[1972] 3 S.C.R.
or to the workmen in the prescribed manner and bas to decide . A
whether or not any modification or addition should be made after
bearing the Union or the workmen concerned. Sections 6, 7, 9
and 10 contain provisions for appeal by aggrieved person> as also
for sending of authenticated copies by Jtbe Certifying Officer to
the parties where no appeal is filed and further the employer bas
to post !he Standing Orders ·as finally certified it1. the manner
B
prescribe<!.
The employer or the workmen can even apply for
modification after expiry of six months from the date on which
the Standing Orders or the last !modification thereof comes into
operation. (7) The schedule sets out the matters which
the
Standing Orders must provide for.
c
For the reasons given above this Court held that the Act was
meant to enable Standing Orders to be made to bind not only
those who were employed subsequent to their certification
bu1
also those who were already in employment. If any other result
were to follow there would be different conditions of employmen1
for different ~.Jsses of workmen which would render the conditions of their service as indefini'te and diversified as before the
D
enactment of the Act. Support was derived from the decision in
Salem Erode Electricity Distribution case(') in which departure
was made from the view previously taken in the case of 'Guest
Keen Williams P~t. Ltd.(')
It has been. urged before us on behalf of the respondents that
the decision in Guest Keen Williams Pvt. Ltd.(2) still holds the E
field and the point which was decided there and which arises in the
present case did not come up for consideration in Salem Erode
Electricity Distribution Co. Ltd. (1). In our opinion the principle
applied in the latter case is fully supported by the scheme of the
Act and was rightly extended and applied in Agra Electric Supply
Co. Ltd. (3 ). We concur with the view expressed therein that it F
was not intended by 'the legislature that different sets of conditions
should apply to employees depending on whether a workman was
employed before the Standing Orders were -certified or after,
which would defeat the very object of the legislation. In the
preamble it .is ~tated in categorical terms "whereas it is expedient
to require employers in industrial establishments to define with G
sufficient precision the conditions of employment under them and
to make the said conditions known to workmen employed by
them". Not only the object but the scheme of the Act is such
that the employers must define preCisely Jtbe conditions of employment of all the employees and have the same certified by the
Certifying Officer against whose ·orders an appeal lies to
the
H
appellate authority.
The right given to workmen to express their
(I) [1966] 2 S.C.R. 498.
(2) (1960] I S.C.R. 348.
(3) (1970] I S.C.R. 808.
U.P. ELECTRIC co. v. T. N. CHATTERJEE (Grover, J.) 763
A
View and tQ. raise objections is of great significance. They can
even ask for modification of the Standing Orders in accordance
with s. 10 qf the Act. Every possible safeguard has been provided for keeping the workmen informpd about their conditions
of service SQ ithat they can take whatever steps they desire or ar~
ad~ to !ake in: their interest before the Certifying Officer •Or
B othe appellate authority. It is also very difficult to conceive tak·
ing each individual item in the schedule how there can be diffe·
rent conditions for different employees depending upon the point
of time when they came to be employed; for instance item 3
relates to shift working.
It is possible to sugge~t that for the
same kind of work employees who were in employment before the
Standing Orders were certified would have· different hours of
C shift from the other employees who were employed subsequently.
In -Ole very nature of things a great deal of irritation and annoy·
ance between employees inter se would result if any such discrimination is made in any of the items in the schedule. It has
been rightly pointed out in Agra Electric Supply Co. Ltd. that
this would only lead to' industrial unrest and not industrial pea~e,
D the latter being the principal object of legislation.
It must be remembered that in Guest Keen Williams Pvt. Ltd.
the Certifying Officer could not gci into the reasonableness or
fairness of the Standing Orders according to s. 4 of the Act as it
stood at the material time. The law was changed only in 1956.
Perhaps that was one of the main reasons which prompted the
E court in takine; the view it did. But after the amendment of the
law in 1956 the Certifying Officer and the appellate authority are
dutv bound to examine the question of fairness of ithe Standing
Orders and there can be no justification now not to give effect to
the principk of uniformity of conditions of service which is
clearly .contemplated by the provisions of the Act.
F
The next question for determination is whether clause 32 of
the Standing Orders relating to age of retirement could be certi·
fied in July 1951. On behalf of the respondents it has been
pointed out that there is no item in the schedule which covers
the case of retirement or superannuation. Items 8 and 9 are in
G these terms :-
"8. Termination of employment and the notice thereof to be given by employer and workmen,
9. Suspension or dismissal for misconduct, and acts
or omissions which con:stitute misconduct."
The model Standing Orders framed by the Central Government
H
and by !he Government of the \State of Uttar Pradesh did not
contain any clause relating to retirement or superannuation. It
was for the first time that on November 17, 1959 item 11-C
764
SIJPREME COURT REPORTS
[1SJ72] 3 S.C.R
relating to superannuation and retirement was introduced by the
A
State of U.P. in exercise of the.rule-making powers conferred by
s. 15 of the Act. In other States the item relating to age of retirement or superannuation was introduced either by legislation
or by the exercise of rule making power. In 1the State of Bombay
s. 19 of the Industrial Employment (Standing Order~) (Bombay
Amendment) Act 1957 provided for insertion of item 10-A in
B
the Schedule which was "age for retirement or superannuation".
According to counsel for 1he respondents there was no item until
the introduction of item 11-C in Nove!llber 1959 in the schedule
under which any Standing Orders could be framed and got certified relating to the age of retirement and superannuation. It has
been maintained that items 8 and 9 cannot possibly include retireC
ment and superannuation and therefore till item 11 ·C was added
in the schedule so far as the State of U.P. was collcemed in
November 1959 no Standing Orders could be legally or validly
framed and· certified providing for age of retirement and superannuation. In Saroj Kumar Ghosh v. Orissa State Electricity
Board (1) the Orissa High Court considered this question a some
length and expressed the view that where a Standing Order .has
D
been certified by the Certifying Officer coll'taining a clause relating
to superannuation not coveted. by the schedule of the Act nor by .
~-
the model Standing Orders such certification- cannot be valid
under s. 4 of the Act. The clause ltenitlnation of employment'
in item 8 of the schedule cannot be equated with the word "superannuation". According to the Orissa High Court, superannua·
E
tion is an event which comes more or less in an automatic process. An age is fixed on the reaching of which the holder of
office has no option but to go out of office. There is no volition
involved in that act. The employer and the employee have notice
of the matter long before the event is to occur and the event is
such that it cannot be arrested by either one of them if the rule
is to be followed. On the other hand tetmination is a positive act
F
by which one party even against the desire of the other can bring
about the end of employment. The judgment of the learned
single judge in Management of the "HINDU'', Madras v. Secretary Hindu Office & National Press Employees Union and t111other(') was dissented from.
In that case the expression "tennination· of employment" in item 8 was considered to be wide
G
enough to include retirement of an employee at the age of superannuation. The learned Madras Judge sought support from
para 16 of t\le model Standing Orders which is as follows :-
"Every permanent workman shall be entitled to a
service certificate at the time of his dismissal discharge
H
or retirement from service".
(I) A.l.R. 1970 Orissa 126.
(2) A.l.R. 1961 Mad. 107.
A
B
c
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U.P. El.ECTRIC co. v. T. N. CHATTERJI (Grover, J.)
765
In the model Standing Orc!ers there was no clause providing for
superannuation or re1irement on attaining a cettain age.
In our judgment much assistance or help cannot be derived
from para 16 of 1he model Standing Orders as contained in schedule I to the Industrial Employment (Standing Orders) Central
Rules 1946.
Retirem.~nt which is .J)lentioned there may be ur.der
tl;e ,terms of contract of employment entered into between the
employer and the employees. Section 2 ( oo) of the Industrial
Disputes Act 194 7 throws a· certain amount of light on the
matter. It is reproduced below·:-
"Retrenchment" means !he termination by the employer Qf the service of a workman for any reason
whatsoever, oth-;rwise than as a punishment inflicted by
way of disciplinary action, but does not include-
(a) voluntary retirement of llhe workman; or
(b) retirement of the workman on reaching the age
of superannuation if the contract of employment between the employer and llhe workman conc.emed contains a stipulation in that behalf;"
It shows, firstly, that termination of service of a workman is distinct from retirement on. reaching the age of' superannuation;
E
secondly, retirement can take place on reachin.1 the age of superannuation uncler the terms of the contract of employment entered
into between the employer and the workman. Therefore, the
word "retirement" in para 16 cannot te regarded as conclusive
of the question whether termination of employment includes
retirement and superannuation. In the schedule to llhe Act i.em
F
8 covers termination of employment and the notice to be ~iven
either by the employer or the workman and i'lem 9 relates to suspension or dismissal for misconduct etc. ' Item 8 by virtue of the
language employed does not al)pear to cover the case of superannuation which does not depend on any notice and which covers
an evel!t which is automatic and which must be gh'!n effect to
without any volition on the part of the employer or the workmen
G
as pointed out in the Orissa judgment. If termination is to be
read in a wide sense as meaning employment coming to· an end
there was a necessity to have i~;m 9 because dismissal would
then be covered by termination. In the context in which the
word "termination" is used in item 8 it cannot mean each and
everv. form of termination or c".s<ation of employment.
From
u para 13 of the Model S'andin~ Orders contain•;d in schedule I
to the Indu~trial Emolovment (Standing Orders) Central Rules
1946, it is aooarent that item 8 is confined to termination of em·
plovment bv notice in writing and does not contain any mentien
3-Ll06I S"P· Cl/72
186
SUPREMll COURT REPORTS
(1972] 3 S.C.ll.
of superannuation or re.irement. It Was perhaps this difficulty
wn1c11 prouwieo me :State of U.P. to introouce item 11-C in
exerc1;e oi tne ru1e maKing powers conterred by s. l:i ot tho Act
ana tne bomoay legmaiu;e to make similar amendmen. by 1eg1slat10n.
1t would 1011ow that unless an employer can inc1u.Je a·
clause reiatmg to 'the age of retirement and superannuation and
the Cer.ifymg Officer Cdn cerri•Y it even thou?,h no
>U~h itom
appears in the schedule to the Act clause 32 as certified in 1 \I~ l,
ir1 the pre>·~nt ca~e. cou.d not be regarded to be valid.
The
Madras High Court in the case of Managemenl of the 'Hindu',
Mauras\•) maae some oo>ervations to the ertect that the~e was
A
B
no bar to the Standin11; Orders making a provision for m1tters
other than those specifically m~ntioned in the schedule so long us c
the Certifying Officer certifies mem on .he ground that 'they a. e
fair and reasonable.
The Orissa High Com t, however,
in
Sarojkumar Ghosh's(') case did not subscribe to thi> view.
Learned counsel for the appellant, apart from
rolying on ·•he
Madras decision, has not addressed any arguments on 1h:-hlrger
and wider question as to whether even in the absenoo of any item
in the schedule Standing Orders can be framed on certain matlcrs
D
which may be re11;arded as fair and reasonable and which may oo
so certified by the Cer.ifying Officer. It is, however, unnecessary
to decide this point in the present case because clau~ 32 of the
Standing Ord~i s on which the appellant has relied was certifi.:d
in July 1951 when according to the express language of s. 4 of
'ihe Act the Cenitylnit Officer or the appellate all'thority was deE
barr~ from adJudicatine uoon the fairness or reasonableness of
the provisions of any Standing Orders. It is difficult to understand how •he Certifyin~ Offi:er at that Point of ime and before
the amendment of s. 4 in 1956 could have possiblv certified ony
S•anding Order which did not relate to any item in the schedule
on the eround that it was fair or reasonable. IncJeed the lunC'io11
of the Certifying Officer, before the amendment of 1956, was
very limi ed as is clear from s. 3(2) of the Act which says :
"Provision shall be made in such draft for every
matt.~r set out in the <chedule which may be aool;c"ble
to the indmtrial establishment and where model StandF
ing_ Orders have been prescribed, shall be, so far is pracG.
ticable, in conformity wi.h such model".
We must, therefore, hold that clause 32 of the Standing Orders
as certifod in July 1951 was not valid and cannot be binding on
the resoond.~nts. However, after i'em 11-C was intrncluced
in
the schedu'e so far as the State of U.P. was concerned an item
was added provic1ing for the age of retirement and super~nnuaH
tion.
The Certifying Officer, whe.n he modified clause 32 and
(I) AIR 1961 Mad. 107.
(2) AIR 1970 Orrissa 126.
A
B
c
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'
G
U.J>. ELECTRIC co. v. T. M. CHATTBRJI (Grover, I.)
161
fixed the re.iring age.at 58 on April 22, 1961 coμJd·have validly
certiried such clause as modified by him. The necessary comequence will be that the respondents could not have been re.ired
on the JI.round of sup~rannuation in July 1959 and they could be
validly reti~ only on or after Ap1il 22,
1961 in accordance
with clause 32 as modified by lhe Certifying Officer. In other
words, ~hose out of the present respondent' who had attained the
Bl!;e of 58 years on April 22, 1961, could be regarded as hJving
been validly retired having reached the age of superannuation on
that da,e under fhat c\ause.
In view of the previous decisions of this Court and in particular that o( Guest Keen Wl/liamv Pvt. Ltd.(') it has n,t been dist
puled ,hat in the industrial dispute which was referred it was optln
to the Industrial 'tribunal or the Labour Court to dete,mm~ me
age of re.irement or superannuation notwifhstanding that clause
32 of the. Sta11dinl!; Orders as certilied in 1961 had been legally
and validly certified. Indeed in Guest Keen Williams _Pvt. Ltd. ( 1)
it was not disputed that even this Court could give an appropriate
direction which might be considered reasonable with regard to
fixin.e; the aee of superannuation. As sta.ed before, according 10
clause 32 of <the Standing Orders, as certified in April 1961, the
age of superannuation wall. jixed at 58.
The appellant filed an
appears that in the case of Agra Electric Supply.Co.(') also a
appears that in the care of Agra Electric Supply' Co.(') also a
similar Standinl!; Order had been certified and on appeal th~ age
of retirement was reduced from 58 to 55 years by the appellate
authority.
This Court in fhat case held the Standing Order fixing
the age at 55 ~~ars applicable not only to 1hose employees who
were emP.lo.ved subsequently. but also to all workmen who were
in employment at the time when the Standing Orders became
legally applicable. It does not ·appear in tha1 case that anv such
argument was raised fhat th•! matter should be remitted eith~r to
the Indus~rial Tiibunal or the Labour Court to fix the age of
superannuation or that this Court itself might do so as was · fhe
course followed in the case of Guert Keen Williams Pvt.