Case: All India Bank Employees  Vs. National Industrial Tribunal &amp; Others (And Connected Petitions)

no criterion had been indicated as to the circumstances in which Banks could decide to make the claim. But this, however, is answered by the provision itself which runs :"When the banking company claims that such document, statement or information is of a confidential nature and that the production or inspection of such document . . .. .. . . .. . . would involve disclosure of information relating to the matters set out-the matter set out in sub-cls. (a) and (b)."It was also submitted that sub-cl. (b) of sub-sec. (1) was vague, in that a reference was made to "provision made for bad and doubtful debts and other usual or necessary provisions". We do not see any substance in this point either, because these words are taken from the form under the Banking Companies Act and their meaning is clear in banking circles. In fact, in the application which the employee associations made before the adjudicator to direct the production of information and documents from the banks this phrase was used and it is apparent that even the Bank Employees Associations understood it as having a definite connotation.36. It was next submitted on behalf of some of the interveners that S. 34A(1) and (2) violated Art. 14 in that the classification contained in it was impermissible as not being based on rational grounds. It was said (1) that the protection against a disclosure applied only to adjudications under the Industrial Disputes Act and not to other adjudications; (2) that it applied only to certain banking companies and not to all banking companies; and (3) that by reason of S. 34A(2) the provisions of the impugned enactment were applied in a discriminatory manner to all banks other than the Reserve Bank. The first two points cover the same ground and arise out of the fact that the impugned provision by its 3rd sub-section defines a "banking company" referred to in it and to which its provisions apply, as meaning a "Banking Company" under the Industrial Disputes Act, 1947. The Industrial Disputes Act defines a "Banking Company" in S. 2(b)(b) as follows :"Banking Company means a banking company as defined in S. 5 of the Banking Companies Act. 1949, having branches or other establishments in more than one State and includes the State Bank of India and the Reserve Bank of India."It would thus be seen that though the Banking Companies Act applied to every banking company, it is only those banks whose operations extended beyond one State that were brought within the scope of the definition of a "banking company" under the Industrial Disputes Act. The result of that was that Banking Companies not having branches in more than one State would be an industry so as to be within the Industrial Disputes Act but not "a banking company" within its definition. In the circumstances learned Counsel is right in his submission that such banking companies as are not within the definition of "a banking company" under the Industrial Disputes Act would not be entitled to claim the protection from disclosure conferred on "banking companies" by the impugned provision. This, however, is no ground for holding the legislation invalid. In the first place, the complaint of discrimination is not by the banks who are not on the terms of S. 34A entitled to the protection from disclosure of their reserves, etc. Secondly it is common ground that 95 per cent. of the banking business in this country is in the hands of Banks which are within the definition of "banking companies" under S. 2(b) (b) of the Industrial Disputes Act. Besides, these banks employ over 80,000 out of the 90,000 bank-employees. In the circumstances and seeing that the injury to the credit structure will only be by the disclosure of the reserves etc. of the banks of this class, there is sufficient rational connection and basis for classification to justify the differentiation. The fact that the legislation does not cover every Banking Company is therefore no ground for holding the provision to be discriminatory within Art. 14.37. The last point about the exclusion of the Reserve Bank of India from the operation of S. 34A(2) has also no substance. In the very nature of things and on the scheme of the provision the Reserve Bank could not but be excluded from sub-s. (3) of the impugned provision. In determining what reserves could properly be taken into account, the Reserve Bank would be discharging not any quasi-judicial but only an administrative function, determining this matter with reference to uniform business principles and it therefore appears to us that there is no impropriety in its findings being final even in regard to itself. A submission on similar lines about bias was also made in relation to the impact of the impugned provision in so far as it related to the industrial disputes between the State Bank of India and its employees. It was pointed out to us that the Reserve Bank of India owned practically the entirety of the share-capital of the State Bank of India, with the result that the Reserve Bank was pecuniarily and vitially interested in supporting the State Bank as against the latters employees in any industrial dispute and that the element of bias which the situation involved would invalidate the impugned provision. We consider this argument without force. If, as we have held, the impugned provision is valid and does not violate any of the freedoms guaranteed by Part III of the Constitution in regard to the employees of the Reserve Bank, the challenge to the impugned provision cannot obviously be successful in the case of the employees of the State Bank.38. As we have stated earlier, though the arguments before us ranged on a very wide ground, we have not thought it necessary to deal with all of them because in view of our conclusions on the crucial points in the case the others which were subject of debate before us did not arise for consideration.

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

Explanation:
0[ds]We are clearly of the opinion that this has to be answered in the negative. An affirmative answer would be contradictory of the scheme underlying the text and the frame of the several fundamental rights which are guaranteed by Part III and particularly by the scheme of the seven freedoms or groups of freedoms guaranteed by sub-cls. (a) to (g) of Cl. (1) of Art. 19.The acceptance of any such argument would mean that while in the case of an individual citizen to whom a right to carry on a trade or business or pursue an occupation is guaranteed . by sub-cl. (g) of Cl. (1) of Art. 19, the validity of a law which imposes any restriction on this guaranteed right would have to be tested by the criteria laid down by Cl. (6) of Art. 19, if however he associated with another and carried on the same activity-say as a partnership, or as a company etc., he obtains larger rights of a different content and with different characteristics which include the right to have the validity of legislation restricting his activities tested by different standards, viz., those laid down in Cl. (4) of Art. 19. This would itself be sufficient to demonstrate that the construction which the learned Counsel for the appellant contends is incorrect, but this position is rendered clearer by the fact that Art. 19-as contrasted with certain other Articles like Arts. 26, 29 and 30-grants rights to the citizen as such, and associations can lay claim to the fundamental rights guaranteed by that Article solely on the basis of their being an aggregation of citizens, i.e., in right of the citizens composing the body. As the stream can rise no higher than the source, associations of citizens cannot lay claim to rights not open to citizens, or claim freedom from restrictions to which the citizens composing it are subject.19. The resulting position may be illustrated thus : If an association were formed for the purpose of carrying on business, the right to form it would be guaranteed by sub-cl. (c) of Cl. (1) of Art. 19 subject to any law restricting that right conforming to Cl. (4) of Art. 19. As regards its business activities, however, and the achievement of the objects for which it was brought into existence, its right would be those guaranteed by sub-cl. (g) of Cl. (1) of Art. 19 subject to any relevant law on the matter conforming to Cl. (6) of Art. 19; while the property which the association acquires or possesses would be protected by sub-cl. (f) of Cl. (1) of Art. 19 subject to legislation within the limits laid down by Cl. (5) of Art. 19.There is no doubt that in the context of the principles underlying the Constitution and the manner in which its Part III has been framed the guarantees embodied in it are to be interpreted in a liberal way so as to subserve the purpose for which the constitution-makers intended them and not in any pedantic or narrow sense, but this however does not imply that the Court is at liberty to give an unnatural and artificial meaning to the expressions used based on ideological considerations. Besides it may be pointed out that both under the Trade Unions Act as well as under the Industrial Disputes Act the expression union signifies not merely a union of workers but includes also unions of employers. If the fulfilment of every object for which a union of workmen was formed were held to be a guaranteed right, it would logically follow that a similar content ought to be given to the same freedom when applied to a union of employers which would result in an absurdity. We are pointing this out not as any conclusive "answer, but to indicate that the theory of learned Counsel that a right to form unions guaranteed by sub-cl. (c) of Cl. (1) of Art. 19 carries with it a fundamental right in the union so formed to achieve every object for which it was formed with the legal consequence that any legislation not falling within Cl. (4) of Art. 19 which might in any way hamper the fulfilment of those objects, should be declared un-constitutional and void under Art. 13 of the Constitution; is not a proposition which could be accepted aswould be seen that if the right to strike were by implication a right guaranteed by sub-cl. (c) of cl. (1) of Art. 19 then the restriction on that right in the interests of the general public, viz., of national economy while perfectly legitimate it tested by the creteria in cl. (6) of Art. 19, might not be capable of being sustained as a reasonable restriction imposed for reasons of morality or public order. On the construction of the Article, therefore, apart from the authorities to which we shall refer presently, we have reached the conclusion that even a very liberal interpretation of sub-cl. (c) of cl. (1) of Art. 19 cannot lead to the conclusion that the trade unions have a guaranteed right to an effective collective bargaining or to strike, either as part of collective bargaining or otherwise. The right to strike or the right to declare a lock-out may be controlled or restricted by appropriate industrial legislation, and the validity of such legislation would have to be tested not with reference to the criteria laid down in cl. (4) of Art. 19 but by totally differentis obvious that freedom of speech" means freedom to speak so as to be heard by others, and therefore to convey ones ideas to others. Similarly the very idea of freedom of expression necessarily connotes that what one has a right to express may be communicated to others. Unless therefore the freedom guaranteed by sub-cl. (a) of cl. (1) of Art. 19 were read as confined to the right to speak to oneself or to express his ideas to himself, which obviously they could not mean, the guaranteed freedom would mean freedom to address others, and of conveying to others ones ideas by printed word, viz., freedom of circulation. We do not see, therefore, any analogy between the case which was considered by this Court in Romesh Thappars 1950 SCR 594 : (AIR 1950 SC 124  ), case and the one beforethe two decisions referred to the learned Judges of the Supreme Court of the United States were not construing the content of a provision on the lines of Art. 19(1) (c), for in America, the right of association is not any specifically guaranteed right, but has been derived by judicial interpretation of the due process clause of the 14th Amendment. But apart from this the legislation there impugned was one which directly affected the formation of the association and in that sense may be hit by the terms of sub-cl. (c) of Cl. (1) of Art. 19 if statutes with similar purpose were enacted in India. The decisions cited are no authority for the second step in the argument for which they werehave, therefore, reached the conclusion that the right guaranteed by sub-cl. (c) of Cl. (1) of Art. 19 does not carry with it a concomitant right that the unions formed for protecting the interests of labour shall achieve the purpose for which they were brought into existence, such that any interference to such achievement by the law of the land would be unconstitutional unless the same could be justified as in the interests of public order or morality. In our opinion, the right guaranteed under sub-cl. (c) of Cl. (1) of Art. 19 extends to the formation of an association and in so far as the activities of the association are concerned or as regards the steps which the union might take to achieve the purpose of its creation, they are subject to such laws as might be framed and that the validity of such laws is not to be tested by reference to the criteria to be found in Cl. [(4) of Art. 19 of thedispute between the parties in relation either to wages, bonus or other amenities or perquisites which involve financial obligations on the part of the employer remain even after the impugned provision was enacted, with the adjudicator and he alone determines the rights of the parties subject to the provisions of the Industrial law or other relevant legislation, and the relief which he could award to the employees remains the same. The adjudicator alone determines the capacity of the industry to pay or to bear the enhanced cost. The only result of S. 34-A is that in regard to two items, viz., secret reserves and the provision made by banks "for bad and doubtful debts and other necessary provisions", the reasonable quantum which would be available for being taken into account by the adjudicator would be estimated and determined by an expert body which is a governmental authority or practically a department of Government, viz., the Reserve Bank of India which is entrusted by law with duty of maintaining the credit structure of thequestion was how far information which in the interests of national economy the banks were entitled to withhold from their shareholders and the general public, was to be made available for determining the capacity of the banks to pay their employees. It was in these circumstances that the impugned legislation was enacted which while preserving industrial adjudication in respect of disputes between the banks and their employees, entrusted the duty of determining the surplus reserve which could be taken into account as part of the assets for determining capacity to pay, to the Reserve Bank. Thus understood there does not appear to be anything unreasonable in the solution which the impugned legislation haswe have pointed out already, the impugned legislation merely carries out to its logical conclusion the effect of the changes in the form of the balance-sheet and Profit and Loss accounts of Banks which starting in 1927 culminated in the notification dated December 22, 1951 under S. 29(4) of the Banking Companies Act amending the Forms appended to that Act. If the construction of the "right to form unions under sub-cl. (c) of Cl. (1) of Art. 19 put forward by learned Counsel for impugning the validity of the enactment is negatived, then subject to the point about Art. 14 which we shall examine presently, legislative, competence being conceded there could be no legal objection to its validity. Objections based on colourable legislation have relevance only in situations when the power of the legislature is restricted to particular topics, and an attempt is made to escape legal fetters imposed on its powers by resorting to forms of legislation calculated to mask the real subject-matter. No such problem exists in the present case and it is common ground that once the legislation passes the test of the fundamental rights guaranteed by Part III, legisative competence not being in dispute, its validity is beyond cavil. The question whether the secrecy assured by S. 21 of the Industrial Disputes Act is or is not sufficient to protect the interests of the Banks, is a matter of legislative policy-and is for Parliament alone-and even the fact that the Court could be persuaded that the existing law is sufficient would be no ground for invalidating the impugned legislation. When the end which the legislature seeks to achieve, viz., secrecy is competent, the enquiry as to ultra vires stops. Whether less than what was done might have been enough, whether more drastic provision was made than occasion demanded, whether the same purposes could have been achieved by provisions differently framed or by other means, these are wholly irrelevant considerations for testing the validity of the law.They do not touch or concern the ambit of the power but only the manner of its exercise, and once the provisions of Part III of the Constitution are out of the way, the validity of the legislation is not open towould thus be seen that though the Banking Companies Act applied to every banking company, it is only those banks whose operations extended beyond one State that were brought within the scope of the definition of a "banking company" under the Industrial Disputes Act. The result of that was that Banking Companies not having branches in more than one State would be an industry so as to be within the Industrial Disputes Act but not "a banking company" within its definition. In the circumstances learned Counsel is right in his submission that such banking companies as are not within the definition of "a banking company" under the Industrial Disputes Act would not be entitled to claim the protection from disclosure conferred on "banking companies" by the impugned provision. This, however, is no ground for holding the legislation invalid. In the first place, the complaint of discrimination is not by the banks who are not on the terms of S. 34A entitled to the protection from disclosure of their reserves, etc. Secondly it is common ground that 95 per cent. of the banking business in this country is in the hands of Banks which are within the definition of "banking companies" under S. 2(b) (b) of the Industrial Disputes Act. Besides, these banks employ over 80,000 out of the 90,000 bank-employees. In the circumstances and seeing that the injury to the credit structure will only be by the disclosure of the reserves etc. of the banks of this class, there is sufficient rational connection and basis for classification to justify the differentiation. The fact that the legislation does not cover every Banking Company is therefore no ground for holding the provision to be discriminatory within Art. 14.37. The last point about the exclusion of the Reserve Bank of India from the operation of S. 34A(2) has also no substance. In the very nature of things and on the scheme of the provision the Reserve Bank could not but be excluded from sub-s. (3) of the impugned provision. In determining what reserves could properly be taken into account, the Reserve Bank would be discharging not any quasi-judicial but only an administrative function, determining this matter with reference to uniform business principles and it therefore appears to us that there is no impropriety in its findings being final even in regard to itself. A submission on similar lines about bias was also made in relation to the impact of the impugned provision in so far as it related to the industrial disputes between the State Bank of India and its employees. It was pointed out to us that the Reserve Bank of India owned practically the entirety of the share-capital of the State Bank of India, with the result that the Reserve Bank was pecuniarily and vitially interested in supporting the State Bank as against the latters employees in any industrial dispute and that the element of bias which the situation involved would invalidate the impugned provision. We consider this argument without force. If, as we have held, the impugned provision is valid and does not violate any of the freedoms guaranteed by Part III of the Constitution in regard to the employees of the Reserve Bank, the challenge to the impugned provision cannot obviously be successful in the case of the employees of the State Bank.38. As we have stated earlier, though the arguments before us ranged on a very wide ground, we have not thought it necessary to deal with all of them because in view of our conclusions on the crucial points in the case the others which were subject of debate before us did not arise for consideration.