Case: Mohmedalli &amp; Others Vs. Union of India &amp; Another

the executive, it cannot be said that there was excessive delegation of powers by the legislature. On the other hand, if a review of all those facts and circumstances and the provisions of the statute, including the preamble, leaves the Court guessing as to the principles and standards, then the delegate has been entrusted not with the mere function of applying the law to individual cases, but with a substantial portion of legislative power itself. Applying those principles which are now well-established by quite a number of decisions of this Court, can it be said in the instant case that the legislature had not indicated clearly the principles underlying the legislation and the standards to be applied ? In our opinion, the answer must be an emphatic "No."It was next contended that the Act was intended by Parliament to apply to employees who were mere wage-earners and not to salaried servants, and that in the instant case, the employees of the petitioners were not mere wage-earners. It is a little difficult to appreciate the distinction sought to be made. Both "salary" and "wages" are emoluments paid to an employee by way of recompense for his labour. Neither of the two terms is a "term of art." The Act has not defined wages; it has only defined "basic wages" as"all emoluments which are earned by an employee while on duty or on leave with wages in accordance with the terms of the contract of employment and which are paid or payable in cash to him, but does not include . . . " [S. 2 (b).] [Exclusions are not relevant for our present purposes and, therefore, need not be read.] "Salary, " on the other hand, is remuneration paid to an employee whose period of engagement is more or less permanent in character, for other than manual or relatively unskilled labour. The distinction between skilled and unskilled labour itself is not very definite and it cannot be argued, nor has it been argued, that the remuneration for skilled labour is not "wages." The Act itself had not made any distinction between "wages" and "salary." Both may be paid weekly, fortightly or monthly, though remuneration for the days work is not ordinarily termed "salary." Simply because wages for the month run into hundreds, as they very often do now, would not mean that the employee is not earning wages, properly so called. A clerk in an office may earn much less than the monthly wages of a skilled labourer. Ordinarily he is said to earn his salary. But, in principle, there is no difference between the two. It is, therefore, not established that the Act was not intended to apply to salaried employees, if by salary is meant fortnightly or monthly wages running into hundreds per monthly. It is manifest that there is no force in this contention.It now remains to consider the third and the last contention raised on behalf of the petitioners, namely, that the Act suffers from the vice of discrimination, and therefore, infringes Art. 14 of the Constitution. It is even more difficult to understand this contention, because, as already pointed out, the Act applies to all establishments, except those recited in S. 16, which before it is amendment by Act XLVI of 1960 exempted establishments belonging to Government or to a local authority. But whatever vice there may have been in that provisions has been removed by amending the section, which stands after the amendment as under :"16. (1) This Act shall not apply - (a) to any establishment registered under the Co-operative Societies Act, 1912, or under any other law for the time being in force in any State relating to co-operative societies employing less than fifty persons and working without the aid of power; or (b) to any other establishment employing fifty or more persons or twenty or more but less than fifty persons until the expiry of three years in the case of the former and five years in the case of the latter, from the date on which the establishment is or had been set up. Explanation. - For the removal of doubt it is hereby declared that an establishment shall not be deemed to be newly set up merely by reason of a change in its location." 13. Clause (a) of S. 16, as it now stands, has exempted establishments registered under the Co-operative Societies Act, because it is well-known that it is the settled policy of the Government to foster co-operative societies with a view to their development and growth in the interest of the community. It is not necessary to cite instances where this Court has held that co-operative societies stand on a special footing which distinguishes them from other establishments or corporations. Clause (b) has reference to establishments which have been in existence for less than three years or five years, the case may be. That is an understandable classification with a view to save newly started establishments from the additional burden of making contribution to provident fund in respect of its employees. It is clear that the exemption is a short-lived one because with the efflux of three of five years period, they will automatically come under the scheme framed under the Act. The operation of S. 17 has already been discussed, and it has already been indicated that an establishment coming under the exemptions granted or to be granted under S. 17 does not mean that the establishment bears less burden of its share of contribution to the fund. It has not been contended before us that the petitioners establishment does not come within the general rule laid down in S.1(3) of the Act or within the scope of the scheme framed under S. 5. It is equally clear that all hotels and restaurants come within the scope of the notification impugned in this case. Hence, there is absolutely no reason for complaint that the petitioners establishment of that class has been chosen for hostile discrimination. 14.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]It would appear from the terms of the relevant portion of S. 17 that the exemption to be granted byte appropriate Government is not in the nature of completely absolving the establishments from all liability to provide the facilities contemplated by the Act. The exemptions are to be granted by the appropriate Government only if in its opinion the exempted establishment has provisions made for provident fund, in terms at least equal to, if not more favourable to its employees. In other words, the exemption is with a view to avoiding duplication and permitting the employees concerned the benefit of the pre-existing scheme, which presumably has been working satisfactorily, so that the exemption is not meant to deprive the employees concerned of the benefit of a provident fund but to ensure to them the continuance of the benefit which at lest is not in terms less favourable to them. As the whole scheme of provident fund is intended for the benefit of employees, S. 17 only saves pre-existing schemes of provident fund pertaining to particular establishments. Hence, the provisions of Sub-sec. (3) of S. 1, read along with those of S. 17, quoted above, cannot be said to have conferred uncontrolled and uncanalized power on the appropriate GovernmentClause (a) of S. 16, as it now stands, has exempted establishments registered under the Co-operative Societies Act, because it is well-known that it is the settled policy of the Government to foster co-operative societies with a view to their development and growth in the interest of the community. It is not necessary to cite instances where this Court has held that co-operative societies stand on a special footing which distinguishes them from other establishments or corporations. Clause (b) has reference to establishments which have been in existence for less than three years or five years, the case may be. That is an understandable classification with a view to save newly started establishments from the additional burden of making contribution to provident fund in respect of its employees. It is clear that the exemption is a short-lived one because with the efflux of three of five years period, they will automatically come under the scheme framed under the Act. The operation of S. 17 has already been discussed, and it has already been indicated that an establishment coming under the exemptions granted or to be granted under S. 17 does not mean that the establishment bears less burden of its share of contribution to the fund. It has not been contended before us that the petitioners establishment does not come within the general rule laid down in S.1(3) of the Act or within the scope of the scheme framed under S. 5. It is equally clear that all hotels and restaurants come within the scope of the notification impugned in this case. Hence, there is absolutely no reason for complaint that the petitioners establishment of that class has been chosen for hostile discrimination.