LexMONOGRAM MILLS LTD. ETC. versus THE STATE OF GUJARAT
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) MONOGRAM MILLS LTD. ETC. v. THE STATE OF GUJARAT May 7, 1976 621 [H. R. KHANNA, V. R. KRISHNA IYER AND P. K. GOSWAMI, JJ.] Bombay Industrial Relations Act (Bom. I of 1947) as amended by Gujarat Act 21 of 1972, ss. 53A and 53B and rules thereunder-Whether State Legisla- ture competent to enact ss. 53A and 53B-Pith and substance-Rules-Field of A B ) "" operation of. ' Sections 53A and 53B of the Bombay Industrial Relations Act, 1946, were inserted in that Act by the Bombay Industrial Relations and Industrial Disputes C (Gujarat Amendment) Act, 1972. They relate to the constitution of joint management councils, which include representatives of the employees also, for the purpose of forestalling and preventing industrial disputes. Consequent amendments were made in the Bombay Industrial Relations (Gujarat) Rules. The appellants challenged the two sections on the ground that the State Legisla· ture was incompetent to enact them. According to the appellants, the impugned legislation falls under Entries 43, 44 and 52 of List I, VII Schedule to the Con· stitution, which relate to matters of incorporation etc. Tho High Court held that they fall under Entries 22 and 24 of List III, which relate to labour welfare D and industrial disputes, and that the State Legislature was competent to enact them. Dismissing the appeal to this Court, HELD : It has been recognised during the last hundred years that the wage ear· ners &h0uld have an effective voice in the management of the industry in which they E are working. The concept of joint management of industry by the employer and the employee may have a wide connotation, because, the joint management conn .. cils may not only perform such functions as .pertain to welfare of labour, that is, those relating to the various objectives mentioned in els. (a) to (f) of s. 53B(l), but may also claim to exercise such functiqns as can be discharged by the board of directors, This wider aspect of the joint management would however be im- permissible under the impugned provisions, because the provisions should be so construed and implemented as would sustain their constitutional validity. They have been enacted by the State Legislature and so the functions which can be F performed by the joint management councils have to be of such a character as would pertain to welfare of labour or prevent industrial disputes. If the im· pugned legislation, in pith and substance, relates to subjects which are within the competence of the State Legislature, the fact that there is an incidental encroach· ment on matters which are the subject-matter of Entries in List I, would not affect the legislative competence of the State Legislature to pass the impugned legislation. [628A, 629EJ Rules in the very nature of things can operate only m that field in which the parent Act can operate, and _hence, the impugned rules, likewise, relate to sub- jects which are within the competence of the State Legislature. [628D] CIVIL APPELLATE JURISDICTION : Civil Appeals Nos. 60()..601 and 1699-1714 and 877-878 of 1975. G Appeals by ~ial Leave from the Judgment and Order dated H 30th January 1975 of the Gujarat High Court in Sp!. Civil Applns. Nos. 15, 1194, 88, 89, 90,, 107, 113, 121, 122, 124, 125, 166, 182, 202, 112, 123, 177,, 1757, 149, 150 of 1974 respectively. 622 SUPREME COURT REPORTS (1976] SUPPLEMENTARY A F. S. Nariman, K. S. Nanavati, P. C. Bhartari and J. B. Dadachanji, for Appellant (In CA 600/75). K. S. Nanavati, P. C. Bhartari and J. B. Dadachanji, for the Appel- !ants (In CA 601/75 and CA 1700-1714/75). V. M. Tarkunde, K. S. Nanavati, P. C. Bharatari and J. B. Dada• B chanji for ·the Appellant (in CA 1699/75). V. N. Ganpule, for Appellants (In CA 877-878/75). M. C. Bhandare and M. N. Shroff, for the Respondents (In CA 600-601 of 1975) and CA Nos. 1699-1714/75 and 877 to 878/75. ( ., The Jndgment of the Court was delivered by c KHANNA, J.- This judgment would dispose of civil appeals Nos. 600, 601, 877, 878 and 1699 to 1714 of 1975 which have been filed by special leave against the judgment of Gujarat High Court dismissing petitions under article 226 of the Constitution of India filed by the appellants. The appellal}ts in these petitions assailed the validity of sections 53A and 53B of the Bombay Industrial Re- lations Act, 1946 (Bombay Act No. 1 of 1947) (hereinafter referred D to as the principal Act). These sections along with
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