PUNCHIRI BOAT SERVICE LTD Vs. STATE

JUDGEMENT

(1.) THESE are petitions presented by the proprietors of the Punchiri Boat Services Ltd. , Alleppey, P. M. Abraham & Sons Boat service, Alleppey, and the Indian Navigation Co. , Alleppey, respectively under art. 226 of the Constitution of India challenging the following notification marked Ext. A issued by the State of Travancore-Cochin, (No. L. I. 16322/53/dd dated 9th October 1954) fixing minimum wages for boat transport under the minimum Wages Act, 1948 (Central Act XI of 1948): "li. 16322/53/dd. 9th October 1954. In exercise of the powers conferred on them by Clause. (a)of Sub-s. 1 of S. 6 read with Clause. (iii) of Sub-s. (1) of S. 4 of the Minimum wages Act 1948 (Central Act XI of 1948) and after considering the advice of the committee appointed under Clause. (a) of Sub-s. (1) of S. 5 of the said Act, government hereby fix the minimum rates of wages, as specified in the schedule hereto annexed, which shall be payable to the classes of employees in the public Motor Transport mentioned thereunder. This notification shall come into force on and from 15. 10. 1954. Table:#1 Table:#2 N. B. 1. Adolescents 80% of the corresponding daily wages in all the categories. 2. Public Motor Transport Workers (Road Transport) shall be eligible for overtime rates for all work done exceeding 9 hours in a day or 48 hours a week. 3. Public Boat Transport Workers shall be eligible for overtime rates for all works done exceeding 16 hours in a 48 hour period or exceeding 48 hours in a week. By Order of His Highness the Raj Pramukh, K. Narayana menon, Add. Secretary to Government". The State is the first respondent in all the petitions. The other respondent in the second and third petitions who is the third and last respondent in the first is the Dist. Magistrate, Quilon, and the second respondent in the first petition is the District Magistrate, Kottayam, who are the authorities under the Act to investigate into the claims arising out of non-payment of the minimum wages fixed there-under. The Steam and Motor Boat crew Association, a registered union of workmen employed in the boats plying in the backwaters, was allowed to intervene. The Notification fixes minimum wages under three heads, namely, basic pay, dearness allowance and batta. The petitioners challenge only the validity of the inclusion of batta as a part of minimum wages and it is attacked on two grounds, first that it is ultra vires the powers of the State under the Act, and secondly, that it offends art. 19 (1) (g) of the Constitution as it is beyond the capacity of the employer to pay and its insistence would cripple and ultimately ruin the industry. In view of the decision of the Supreme Court in Bijaya Cotton Mills Ltd. v. State of Ajmeer (A. I. R. 1955 S. C. 33) - rendered on 14th October 1954 but not reported on the date of these applications, namely, 17th October 1954, the second point was not rightly pressed by petitioners' counsel in argument. Their lordships held that it is in the interests of the general public that the labourers should be secured adequate living wages and that if individual employers might find it difficult to carry on the business on the basis of the minimum wages fixed under the Act it must be due entirely to the economic conditions of those particular employers and that cannot be a reason for striking down the law itself, despite its standing justified by Clause. (6) of Art. 19, as unreasonable. The only point argued was the first and that concerns the question whether the State is entitled to enter over and above basic pay and dearness allowance, a third head, batta, to form a part of the minimum rate of wages under the Act.

(2.) THE Minimum Wages Act, XI of 1948, owes its origin to the "minimum Wages Fixing Machinery Convention" held at Geneva and its aim is to secure living wages to labourers in industries wherein sweated labour is prevalent with a chance of its exploitation. In the absence of an organisation for the effective regulation of wages such labour not being in a position to resist the threat or pursuasion of capital had to be protected by law. S. 5 (2) of the Act cast the duty on the appropriate Government to fix rates of wages in respect of each scheduled employment by notification in the official gazette. THE two sub-clauses of the first clause of that section provide alternative preliminaries to the making of the said notification. THE appointment of a committee to hold enquiries and advise the Government which advice is to be considered before fixing the minimum rate of wages is provided for in sub-Clause. (a) and an alternative is provided in sub-Clause. (b) which consists of the publication of proposals by Government inviting representations from those likely to be affected in which case those representations are to be considered before fixing the minimum rates of wages. S. 9 prescribes the constitution of the committee and enacts that it should consist of an equal number of persons representing the employers and employees and independent persons not exceeding one-third of the total number of members. THE Chairman of the Committee is to be nominated by the Government from the independents. A committee consisting of nine members was constituted in this case and they submitted a report paragraph 48 whereof relates to batta and reads as follows:- "48. (vi) Batta. THE nature of the Motor Transport industry is such that the operating staff will have to be away from their station of residence for the whole day and on certain occasions spend the night also outside. This necessitates in their taking meals outside their homes incurring extra expenditure. It is not fair to argue that the nature of their duties is such and that they should meet out of station expenses from their salaries. At the same time, the operating staff cannot expect to be fully compensated for all their expenses outside as it would cost them something to have their meals at home. It is only the additional expenses on meals, smoking and chewing that need be considered under 'batta'. It is somewhat similar to the daily allowance that Government servants receive when they go out of station. It need not be large enough to be a source of profit or extra income. Employers have recognised the need for some compensation and most of them have been paying batta distinctly as 'batta' or have included it in the daily wages where payment is made on trip basis. That State Transport Department pays 0-12-0 per day while some fleet operators pay as much as Rs. 1-8-0 and where stay overnight is involved such amount is even higher. In fact, in the case of employees under private operators batta has come to be regarded as part of 'pay' and hence some of the members of the Committee representing labour expressed the desire to include batta under 'allowance'. This is not practicable as the expenses naturally vary a good deal and depend upon the routes, times of operation and other factors. In the case of the boat crew, the out of station hours are generally much longer and batta is even more important. THE Alleppey industrial Tribunal referred to earlier has awarded a batta of 0-2-0 per hour. While the Committee felt it desirable that the minimum wages for the operating staff be fixed in the form of a basic pay plus a cost of living allowance, plus a batta, they were precluded from doing so under Section (2-h-iii and iv) of the Act which says that the term 'wages' does not include any travelling allowance or the value of any travelling concession and 'any sum paid to the person employed to defray special expenses entailed on him by the nature of his employment'. By this the Act does not suggest that such sums to defray special expenses need not be paid to an employee but on contrary, it means that it cannot be set off against the wages and cannot therefore be included in wages and treated as an item for which a deduction can be made. We are therefore not including 'batta' in our recommended figures for Minimum Wages but would like to make it clear that we are not doing so not because we consider that such payment is not necessary but because the inclusion of such an obviously necessary payment under 'minimum Wages' is technically against the provisions of the Act. It is expected that all operating staff will be paid 'batta' which may however be limited to the actual 'extra' expenses entailed on the employee. At present, some of the employers are paying much more than the out of pocket expenses as they do not pay 'dearness allowance' separately. In our recommendation, since cost of living allowance is separately provided for as part of the minimum wages, a reduction in the total amount that is now being paid as 'batta' to the extent of the 'cost of living allowance' is only reasonable, provided the balance is sufficient to cover the extra expenses. We do not find any mention of 'batta' in the notification under the Minimum Wages fixed by the Madras and Mysore Governments and unfortunately there are no reports of the Minimum Wages Committee as no such committees were appointed. It has however been ascertained that batta is not included in their published minimum wages and it has also been ascertained by personal enquiries that the operating staff in the Mysore State get, 0-12-0 and in Madras State Rs. 1-2-0 as 'batta'. THE report of the Bombay Committee was available but unfortunately no mention of 'batta' is made anywhere in the Report, presumably because it is outside the scope of the Minimum Wages Act". THE impugned notification states that it was issued "after considering the advice of the Committee appointed under Clause. (a)of sub-s. (1) of S. 5 of the Act". THE advice of the committee and the notification that followed disagree in one particular and that is as regards batta. Whereas the committee advised the non-inclusion of batta in the minimum wages, the notification of the Government, contrary to the advice of the committee, includes batta as an item constituting minimum wages. It is true that the Government is not bound to accept the advice and act up to it. THEy are, however, bound to consider the advice before issuing the notification and the notification contains an express assurance of such consideration. If any part of the advice is not accepted one would naturally expect an expression of the reason therefor; but no such reason is forthcoming in this case and the state explains its absence by denying any deviation from the committee's advice and asserting in paragraph 6 of the counter-affidavit dated 19. 1. 1955 filed on behalf of the State. "it is true that the Minimum Wages Committee has understood the word batta in the sense in which it has been used by the petitioner. But it is respectfully submitted that the import of the word 'batta' and the purpose for which it is paid has not been correctly understood by the Minimum Wages Committee. In any event, the respondent has not used the word batta in the sense in which it has been understood by the Minimum Wages committee". THE contention urged on behalf of the State is that though batta as understood by the committee cannot form part of the minimum rate of wages to be fixed by the Government the expression as used in the notification does not mean that, but has a different connotation and means merely that it is a part of the first head 'basic wage' though it is entered in another and the third head with a different nomenclature. THE General Secretary of the Union in his counter-affidavit says: "4. THE report of the committee which has gone into the question of the minimum wage, has misunderstood the nature of the batta. As a matter of fact batta is only fixed as a piece rate in addition to the time rate".

(3.) BY way of abundant caution, we add a note that our observations in this judgment are confined to the powers of Government to include batta as a separate head in fixing the minimum rates of wages under S. 5 of the Minimum Wages Act as no other matter is within our purview in these cases. Allowed.