1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.1658 of 1999 ... M/s.Alsecure & Protection Services (I) & ors. ..Petitioners v/s. State of Maharashtra & Anr. ..Respondents WITH WRIT PETITION NO. 64 of 2004 ... Crack Detectives Pvt.Ltd. ..Petitioner v/s. State of Maharashtra & Anr. ..Respondents WITH WRIT PETITION NO. 1804 of 2007 ... The Security Association of India ..Petitioner v/s. Union of India & Ors. ..Respondents WITH WRIT PETITION NO. 2636 of 2007 ... Mr.Rajinder Salvi & ors. ...Petitioners v/s. Union of India & Ors. ...Respondents WITH WRIT PETITION NO. 200 of 2008 ... 2 The Hongkong & Shanghai Banking Corpn. Ltd. ...Petitioner v/s. Union of India & ors. ...Respondents WITH WRIT PETITION NO. 2316 of 2008 ... Mumbai International Airport Pvt.Ltd. ...Petitioner v/s. The Security Guards Board for Brihan Mumbai and Thane District and ors. ...Respondents AND APPELLATE SIDE WRIT PETITION NO. 9335 of 2007 ... Yes Bank Ltd. ...Petitioner v/s. Unon of India & Ors. ...Respondents WITH WRIT PETITION NO. 8353 of 2007 ... K.E.M.Hospital society ...Petitioner v/s. Bhartiya Suraksha Rakshak & General Kamgar Union. ...Respondent ... Mr.C.U.Singh, Sr. Adv. i/b. Mr.R.D.Suvarna, for Petitioner in WP 1658/99, WP 64/04, WP 1804/07, WP 2636/05, WP 200/08 & for Respondent nos.4 & 6 in WP 2316/08. 3 Mr.Bhaven Manek i/b. Wadia Gandhy & Co., for Petitioner in WP 2316/08. Ms.Boski Sharma i/b. Paras Kuhad & Associate, for Petitioner in ASWP 9335/07. MR.J.P.Cama, Sr.Adv. i/b. Sanjay Udeshi & Co., for Petitioner in ASWP 8353/07. Mrs.Lata Desai, for Board. Mr.S.J.Saluja, AGP for State in WP 1658/99, WP 200/08. Mr.L.T.Satelkar, AGP for Respondent no.2 in WP 1804/07 Mr.Milind More, AGP for Respondent no.1 to 6 in WP 2636/05. Mr.Vinod Joshi, for Respondent no.1 in WP 1804/07. Mr.G.Hariharan @ M.S.Bhardwaj, for Union of India in WP 2636/07. Mr.H.K.Vardhan @ Mr.D.A.Dubey, for Union of India in WP 2316/08. Ms.Nisha Walani, for Respondent no.1 in ASWP 9335/07. Mr.K.K.Singhavi, Sr.Adv. With Sushil Mahadeshwar i/b. Ms.Ranjana Todankar, for Respondent no.8 in WP 1804/07, WP 2636/07, & for Respondent no.3 in ASWP 9335/07 & Applicants in WP 64/04, WP 200/08, WP 2316/08, ASWP 8353/07. 4 MR.V.A.Sonpal, AGP for ASWP 9335/07, ASWP 8553/07. Mr.S.S.Pakle, for Applicant in WP 1804/07. MR.V.P.Sawant, for Respondent no.1 in ASWP 8353/07. Mr.M.S.Topkar, for Respondent no.4 in ASWP 9335/07. Mr.Abhay Kulkarni, for Respondent no.6 in ASWP 9335/07. ... CORAM: D.K.DESHMUKH,& R.S.MOHITE, JJ DATED: 14 th August, 2009 JUDGMENT ( PER D.K.DESHMUKH, J.) 1. In this group of writ petitions mainly two reliefs are claimed. First relief that is claimed is that in view of the enactment and coming into force of the Private Security Agencies (Regulation) 2005 (herein after referred to as Central Act ), which is the enactment enacted by the Parliament, Maharashtra Private Security 5 Guards (Regulation of Employment & Welfare) Act, 1981 (herein after referred to as the State Act ) does not operate in relation to the private security agencies. The second main prayer is that in case it is held that the State Act continues to operate in relation to the private security agencies, then the State Government should be directed to pass orders on the proposal pending before it under Section 23 of the State Act for exemption from the provisions of the State Act immediately. 2. Writ Petition No.1804 of 2007 has been filed by the Association of the Security agencies and also by 22 security agencies. According to averments in the petition the security agencies who are petitioners in this petition were carrying on business of security agencies even prior to the 6 commencement of the State Act. According to averments in the petition, some of the Petitioners-agencies were granted exemption from the provisions of the State Act by making an order under Section 23 of the State Act. The Petitioners have also made grievance about the State Government not renewing the exemption order in their favour within time. The above referred two principles reliefs are claimed in this petition. 3. Writ Petition 200 of 2008 is filed by a Bank, which has engaged security guards through Respondents Nos.7 & 8 security agencies. The Respondent No.7-security agency is the Petitioner No.8 in Writ Petition No. 1804 of 2007. It is claimed by the Petitioner that Respondents Nos.7 & 8, security agencies, had in their favour an exemption order passed under the State Act in force 7 when the Central Act came into force and therefore they are deemed to have licence under the Central Act till the application for licence under the Central Act is decided. The Petitioner, therefore, in this petition is claiming the same reliefs which are referred to above. 4. In Writ Petition No.8353 of 2005 the Petitioner is the Public Trust, which runs a hospital. According to the Petitioner, the Respondent No.3-security agency pursuant to an agreement dated 3-6-2004 was providing security guards to the Petitioner. According to the Petitioner, those guards were granted exemption from the provisions of the Act for the period from 12-10-2004 to 12-10-2007. It appears that some of the security guards whose names were mentioned in the exemption notification left the services of the 8 Respondent No.3, new guards joined. Application for recording this change in the exemption notification was made, but it was kept pending. It is claimed that now there is a fresh application with the Respondent No.3 for the period from 1-4-2007 to 31-3-2010. It appears that as the Petitioner was not registered with the Board constituted under the State Act, and as the exemption order in favour of the Respondent No.3 had come to an end, the Board sent its guards to be engaged by the Petitioner. But the Petitioner did not want to do it. It appears that when the premises of the Petitioner were inspected on 4-8-2007, it was found that 53 guards have been engaged, but only two guards were exempted earlier. It means that the Petitioner was engaging 51 guards who were unregistered guards and therefore, proceedings under the State Act and the 9 Scheme framed thereunder has been initiated against the Petitioner. In this petition, it is claimed that in view of the commencement of the Central Act, the State Act does not operate in relation to the Private security guards agencies. It is also claimed that Section 23 of the State Act is invalid, because there is no time limit fixed for deciding the application for exemption filed under that Section. 5. Writ petition No.9335 of 2007 is filed by a Bank. It had engaged the security guards from the Top Security Services Ltd. That security agency has not been joined as a party in this petition. However, it appears that it is Petitioner No.8 in Writ Petition No.1804 of 2007. The grievance of the Petitioner is that the security agency has applied for exemption under section 23 of the 10 State Act, but that application has not been decided and proceedings under the State Act and the scheme are taken against the Petitioner for engaging the guards from the security agency and not the Board, contrary to the provisions of the State Act. According to the Petitioner, in view of the Central Act, State Act does not operate in relation to the Petitioner and it is also prayed that even if the State Act operates, in view of the fact that the security agency has applied for exemption, action against it should not be taken till that application for exemption is decided. The Respondents, however, claim that the Petitioner has suppressed material facts. The Respondents are relying on the order of this Court in Writ Petition No.2254 of 2007 as also the judgment reported in 2007 (5) Bom. 11 Cases Reporter, 405. 6. Writ Petition No.2636 of 2007 is filed by a private security guards, 62 in numbers. They claimed that they have been working with the security agencies, whose names have been disclosed in a chart, Exh.A to the petition. They claimed that in view of the enactment of the Central Act, the State Act and the scheme does not apply in relation to the security agencies with whom they are working. They also claimed that the security agencies on their behalf have applications to the Government under Section 23 of the State Act for grant of exemption and those applications have not been decided by the State Government. None of the security agencies have been joined as parties to this petition. 12 7. Writ Petition No.2316 OF 2008 is filed by the Mumbai International Airport Pvt.Ltd., which is the company formed for the purpose of construction, operation, development and management of the Chhatrapati Shivaji International Airport. According to the Petitioner, initially the Airport Authority of India had engaged guards which were supplied by the Board. After the management of the Airport was taken over by the Petitioner, those guards were working for the Petitioner and the Petitioner was remitting their wages to the Board through the Airport Authority. The Petitioner also engaged some guards through the security agencies i.e. Respondents Nos.4, 5 & 6 for certain works, like traffic and cargo management. According to the Petitioner, the Respondents Nos.4, 5 & 6 have applied for exemption under the State Act, those 13 applications are pending. The Petitioner had applied for its registration as a principal employer of the private security agencies. That application was, however, rejected by the Board by communication dated 9 th March, 2007, observing that the Petitioner has been engaging the guards of the Board, which were assigned to the Airport Authority of India. It is also observed in that order that the Petitioner is the successor of the Airport Authority of India, therefore, it cannot be registered as a principal employer in relation to the exempted security agencies. The Petitioner in the petition, claims that in view of the Central Act, the State Act does not apply and therefore, action against the Petitioner under the State Act and the scheme framed thereunder cannot be taken. It is also the case of the Petitioner that the Petitioner is entitled to be registered under 14 the 2002 Scheme as a principal employer engaging services of the security guards from the exempted agencies. 8. Writ Petition No.64 OF 2004 is filed by the Security Agency challenging Clauses 13(i)(b) and 25(2) of the 2002 scheme framed under the State Act. The challenge is that these clauses in the scheme are contrary to the provisions of the State Act. The Petitioner also challenges conditions Nos.5, 11, 17 & 18 specified in Schedule II to the Notification dated 16 th July, 2003, which is the notification issued under Section 23 granting exemption to the Petitioner-security agency. 9. In this petition, levy of charge is also challenged. But on a motion made by the learned Counsel appearing for the 15 Petitioners, we permitted the learned Counsel to delete the prayer challenging the levy of charge with liberty to file a fresh petition for that purpose. 10. The circumstances in which the State Act came to be enacted have been referred to by the Supreme Court in detail in paragraph 1 of judgment in the case of Security Guards Board for Gr.Bombay and Thane Dist. v/s. Security and Personal Service Pvt.Ltd. And ors. AIR 1987 SC 1370. The relevant portion of that paragraph reads as under:- It appears that there were serious complaints about the service conditions of about 70,000 persons working as Security Guards in various factories and establishments in Greater Bombay and Thane Industrial Complex, the majority of whom were employed through about 250 Security Agencies operating in those areas. The complaints related not merely to insufficient remuneration paid to them by the agencies, but also to 16 insecurity of service and other forms of exploitation. There was a sample survey conducted by the Government of Maharashtra to ascertain the extent of exploitation and to secure information regarding the service conditions of the Security Guards. The sample survey revealed that most of the agencies were not registered under the Shops and Establishments Act. There was only one registered union but that union accounted for membership of 2200 only. It was found that most of the Security Guards did not enjoy the benefit of any Provident Fund Scheme or any scheme of Gratuity. Most of them were not covered by the Employees State Insurance Scheme and had no medical facilities. Leave facilities were inadequate. Rest intervals were not properly provided. Wages were law and only a few agencies paid overtime and bonus. Most of them did not also have either drinking water facility, canteen facility or transport facility. A very meagre percentage of Guards were provided with living quarters. It was recommended that it was absolutely necessary to prevent exploitation of the unprotected Security Guards and to provide them with better service conditions. Pursuant to the report of the committee which made the sample survey, the Government issued the Maharashtra Private Security Guards (Regulation of Employment and Welfare) Ordinance. The ordinance was replaced by the Maharashtra Private 17 Security Guards (Regulation of Employment and Welfare) Act, 1981. Perusal of Section 1 of the State Act shows that it extends to the whole of the State of Maharashtra. But this Act is deemed to have come into force only in Greater Bombay and Thane District on 29-6-1981. Thus, on its enactment, the Act came into force only in Greater Bombay and Thane District of State of Maharashtra. ( We have been informed that subsequently the Act has been extended to Pune District of the State of Maharasthra), However even today the Act does not operate in relation to the State of Maharashtra excluding Greater Bombay and Thane District and Pune District. On commencement of the Act in Greater Bombay and Thane District, number of petitions were filed in this court challenging the validity of the State Act. The petitions were filed both by the Agencies and the Agents who were carrying on business 18 of supplying the security guards on contract basis. These petitions were decided by the learned single Judge of this court by his judgment in the case of M/s.Tradesvel Security Services Pvt.Ltd. v/s. State of Maharashtra,1982 Bombay Law Reporter, Vol.LXXXIV page 608, Hereinafter referred to as the order of Sawant J.)Operative part of the order of Sawant J. reads as under: In the result, (1) the provisions of sub-s (4) of s.3 of the Act are struck down insofar as they penalise the action taken by the principal employer or the Agency or the Agent to dismiss, discharge, retrench or otherwise terminate the appointment of the Security Guard prior to the coming into operation of the Scheme. (2) It is declared that the provisions of s.23 of the Act are to be so read as to extend the exemption to be granted to the Security Guards also to be Agencies and the principal employer with whom they are and will be employed. 19 (3) The rest of the provisions of the Act and of the Scheme are upheld as valid. The petitioners therefore succeed only to the limited extent as stated in sub-paragraph (1) and (2) of para immediately preceding above. The Rule in each of the petitions is discharged subject to what is stated in sub-paragraphs (1) and (2) of para immediately preceding above. In the circumstances of the case there will be no order as to costs. An appeal was filed against the judgment of Sawant J. before the Division Bench. The Division Bench, it appears , dismissed the Appeal. Against the judgment of the learned single Judge and the Judgment of the Division Bench in Appeal, a Petition for Special Leave to Appeal under Article 136 of the Constitution of India was filed before the Supreme Court. That Petition was dismissed by the Supreme Court by order dated 5-1-1983. It appears that while dismissing the Special Leave Petition certain directions were given 20 by the Supreme Court. However, those directions were subsequently withdrawn. In the judgment, Justice Sawant had held that it was competent for security agencies to seek an exemption from the operation of the provisions of the Act. As many as 139 securty agencies applied to the Government under Section 23 of the Act for grant of exemption from the provisions of the Act. 11. These applications were first screened by the Advisory Committee who recommended that exemption might be granted to 21 agencies. The cases of four other agencies which were not recommended by the Advisory Committee were again investigated by the Labour Commissioner who recommended that these four agencies also might be granted exemption from the provisions of the Act. On June 28, 1984, the Government of Maharashtra 21 finally rejected all the applications for exemption filed by the various security agencies thereupon filed writ petitions in this Court. The twenty five writ petitions filed by the twenty one agencies whose cases were recommended by the Labour Commissioner were admitted by this Court and the rest were dismissed in limine. The twenty-five writ petitions which were admitted were also finally dismissed on July 11, 1985 by a learned single Judge of this Court. On appeals preferred by the twenty-five security agencies, a Division Bench of this Court directed the State Government to consider afresh the applications for exemption. An objection raised on behalf of the Security Guard Board and the Government of Maharashtra that security agencies could not seek exemption under Sec.23 of the Act was overruled. This Court took the view that the 22 applications had been rejected as a result of the policy decision not to grant exemption to any security agency and that this was wrong. This Court held that each application for exemption had to be considered on its own merits and so disposed of. Hence, the direction to the Government to consider the applications afresh. The Board constituted under Sec.6 of the State Act preferred twenty five appeals against the judgment of the Division Bench of this court before the Supreme Court. The Supreme Court decided those appeals by its judgment in the case of The Security Guards for Gr.Bombay and Thane District, referred to above. The Supreme Court allowed the appeals and set aside the judgment of the Division Bench of this Court. So far as the provisions of Section 23 are concerned, the Supreme Court held that a security agency cannot seek an exemption in 23 relation to itself, but an exemption can be sought by the security agency n relation to security guards, Class of security guards engaged through it by a principal employer. The observations found in paragraph 7 of that judgment, in our opinion, are relevant. They read as under:- .....A close scrutiny of S. 23, particularly in the light of S. 1(4) read with the definition of `Security Guard , makes it clear that the exemption is not in respect of an agency or an agent or even a factory or establishment but in respect of all or any class or classes of Security Guards employed in any factory or establishment or in any class or classes of factories or establishment. In other words, the exemption is in regard to `Security Guards`, employed in any factory or establishment or in any class or classes of factories or establishments. The exemption may be in respect of all the Security Guards employed in a factory or establishment or in a class or classes of factories or establishments or in respect of a class or classes of Security Guards so employed. For example, all 24 Security Guards employed in factory may be exempted or Security Guard of a particular grade or doing a particular type of work in factory may be exempted. Again all Security Guards employed in a class of factories, say textile mills may be exempted. All Security Guards in all textile mills doing a particular type of work or drawing a particular scale of pay may be exempted. The corelationship of the Security Guard or classes of Security Guards who may be exempted from the operation of the Act is to the factory or establishment or class or classes of factories or establishments in which they work and not with the agency or agent through and by whom they are employed. This analysis has however no bearing on the question of locus standi of the persons who may seek the intervention of the State Government by the issue of notifications for exemption. Obviously the Security Guards or classes of Security Guards employed in a factory or establishment may apply to the Government to exempt them from the operation of the Act. Similarly Security Guards or classes of Security Guards employed in classes of factories or establishments may apply to the Government to exempt them from the operation of the Act. Again a factory or an establishment or a class or classes of factories or establishment may apply to the Government to exempt Security Guards employed in their 25 factories or establishments from the operation of the Act. Though agencies or agents do not enter the picture directly, since the very definition of Security Guards means persons engaged or to be engaged through an agency or agent, it must follow that where Security Guards have been engaged or are to be engaged through them in any factory or establishment or a class of factories or establishments, such agency or agent may also apply to the Government, not to exempt all Security Guards engaged or to be engaged through them but to exempt Security Guards engaged or to be engaged in a factory or establishment or a class of factory or establishments. The question is not one of locus standi at all but which or what class of Security Guards are to be exempted from the operation of the Act and the Scheme. Therefore, we are of the view that even an agency or agent may apply to the Government to grant exemption, but the exemption to be granted by the Government is not to be of any agency or agent but only of Security Guards employed in a factory or establishments or a class or classes of factory or establishments. 12. The State Act was amended by the Maharashtra Private Security Guards (Regulation of Employment and Welfare) 26 (Amendment) Act, 1996. Writ petitions were filed in this court challenging validity of the Amendment Act. Those petitions were decided by the Division Bench of this Court by judgment in the case of Krantikari Suraksha Rakshak Sanghatana v/s. State of Maharashtra, 2006(6) ALL MR 401;The Division Bench dismissed the petitions holding that the Amendment Act is valid. In so far as Amendment Act is concerned, it appears that its validity was challenged mainly on two grounds. Those grounds have been mentioned by the Division Bench in paragraph 2 of its judgment. Paragraph 2 reads as under:- 2. The main submissions of the petitioners- Trade Unions to put in a nutshell are twofold. (i) The first submission is that under the Maharashtra Private Security Guards (Regulation of Employment and Welfare) (Amendment) Act, 1981 ( the said Act for short), as it stood prior to this amendment and as it was interpreted by the Courts, the 27 agencies or the contractors were not permitted to provide the Security Guards and that the employment of the Security Guards and that the employment of the Security Guards who were not the direct employees of the factories or establishments, had to be provided only by the Board constituted under the said Act. It is their contention that this amending Act brings back and permits the agencies or the contractors to provide the Security Guards. The amendment is sought to be challenged as being a retrograde piece of legislation and violative of Articles 14 and 21 of the Constitution of India apart from being contrary to the directive principles contained in Articles 38, 39, 4`1, 42, 43 and 46 of the Constitution of India. (ii) It is their further contention that the amending Act is repugnant to the provisions contained