Case: Chandra Bhavan Boarding And Lodging, Bangalore Vs. The State Of Mysore And Anr

In both these proceedings the validity of the notification issued by the Government of Mysore in S. O. 1038, dated the 1st June, 1967 fixing the minimum wages of different classes of employees in residential hotels and eating houses in the State of Mysore, under the provisions ofthe Minimum Wages Act, 1948 (to be hereinafter referred to as the Act) is called into question. The Civil Appeal arises from the decision of the High Court of Mysore rejecting the various contentions advanced on behalf of some of the hotel owners questioning the validity of the impugned notification. The writ petition is filed by the All Mysore Hotels Association, Bangalore and the Madras Woodland Hotel raising these very contentions.

Reasoning:
It is true that this Court has firmly ruled that the procedural inequality, if read and substantial is also within the vice of Article 14. But then, before a power can be held to be bad the same should be an unguided and unregulated one. But if a power is given to an authority to have recourse to different procedures under different circumstances, that power cannot be considered as an arbitrary power. It must also be remembered that power under Section 5 (1) is given to the State Government and not to any petty official. The State Government can be trusted to exercise that power to further the purposes of the Act. It is not the law that the guidance for the exercise of a power should be gatherable from one of the provisions in the Act. It can be gathered from the circumstances that led to the enactment of the law in question i.e., the mischief that was intended to be remedied, the preamble to the Act or even from the scheme of the Act.We have earlier noticed the circumstances under which the Act came to be enacted. Its main object is to prevent sweated labour as well as exploitation of unorganised labour. It proceeds on the basis that it is the duty of the State to see that at least minimum wages are paid to the employees irrespective of the capacity of the industry or unit to pay the same. The mandate of Article 43 of the Constitution is that the State should endeavour to secure by suitable legislation or economic organisation or in any other way, to all workers agricultural, industrial or otherwise, work, a living wage, conditions of work ensuring a decent standard of life and full enjoyment of leisure and social and cultural opportunities. The fixing of minimum wages is just the first step in that direction. In course of time the State has to take many more steps to implement that mandate. As seen earlier that resolution of the Geneva Convention of 1928 which had been accepted by this country called upon the covenanting States to fix minimum wages for the employees in employments where the labour is unorganized or where the wages paid are low. Minimum wage does not mean wage just sufficient for bare sustenance. At present the conception of a minimum wage is a wage which is somewhat intermediate to a wage which is just sufficient for bare sustenance and a fair wage. That concept includes not only the wage sufficient to meet the bare sustenance of an employee and his family. It also includes expenses necessary for his other primary needs such as medical expenses, expenses to meet some education for his children, and in some cases transport charges etc. - see U. Unnichoyi v. State of Kerala, 1962-1 SCR 946   = (AIR 1962 SC 12  ).The concept of minimum wage is likely to undergo a change with the growth of our economy and with the change in the standard of living. It is not a static concept. Its concomitants must necessarily increase with the progress of the society. It is likely to differ from place to place and from industry to industry. That is clear from the provisions of the Act itself and is inherent in the very concept. That being the case it is absolutely impossible for the legislature to undertake the task of fixing minimum wages in respect of any industry much less in respect of an employment. That process must necessarily be left to the Government. Before minimum wages in any employment can be fixed it will be necessary to collect considerable data. That cannot be done by the legislature. It can be best done by the Government. The legislature has determined the legislative policy and formulated the same as a binding rule of conduct.The legislative policy is enumerated with sufficient clearness. The Government is merely charged with the duty of implementing that policy. There is no basis for saying that the legislature had abdicated any of its legislative functions. The legislature has prescribed two different procedures for collecting the necessary data, one contained in Section 5 (1) (a) and the other in Section 5 (1) (b). In either case it is merely a procedure for gathering the necessary information. The Government is not bound by the advice given by the committee appointed under Section 5 (1) (a). Discretion to select one of the two procedures prescribed for collecting the data is advisedly left to the Government.In the case of a particular employment, the Government may have sufficient data in its possession to enable it to formulate proposals under Section 5 (1) (b). Therefore it may not be necessary for it to constitute a committee to tender advice to it but in the case of another employment it may not be in possession of sufficient data. Therefore it might be necessary for it to constitute a committee to collect the data and tender its advice. If the Government is satisfied that it has enough material before it to enable it to proceed under Section 5 (1) (b) it can very well do so.Which procedure should be adopted in any particular employment depends on the nature of the employment and the information the Government has in its possession about that employment. Hence the powers conferred on the Government cannot be considered as either unguided or arbitrary.In the instant case as seen earlier the question of fixing wages for the various categories of employees in residential hotels and eating houses was before the Government from 1960 and the Government had taken various steps in that regard. It is reasonable to assume that by the time the Government published the proposals in pursuance of which the impugned notification was issued, it had before it adequate material on the basis of which it could formulate its proposals. Before publishing those proposals, the Government had consulted the advisory committee constituted under Section 7.Under those circumstances we are unable to accede to the contention that either the power conferred under Section 5 (1) is an arbitrary power or that the same had been arbitrarilyis unnecessary for our present purpose to go into the question whether the power given under the Act to fix minimum wages is a quasi-judicial power or an administrative power. As observed by this Court in A. K. Karaipak v. Union of India, 1969-2 SCC 262   = (AIR 1970 SC 150  ), the dividing line between an administrative power and quasi-judicial power is quite thin and is being gradually obliterated.It is further observed therein that principles of natural justice apply to the exercise of the administrative powers as well. But those principles are not embodied rules. What particular rule of natural justice, if any, should apply to a given case must depend to a great extent on the facts and circumstances of that case, the framework, of the law under which the inquiry is held and the constitution of the tribunal or body of persons appointed for the purpose.Taking into consideration the provisions of the Act, the objective behind the Act, the purposes intended to be achieved and the high authority on whom the power is conferred, we have no doubt that the procedure adopted was adequate and effective.We have equally no doubt that reasonable opportunity had been given to all the concerned parties to represent their case. We are unable to agree that the impugned order is vitiated because of the Governments failure to constitute a committee under Section 5 (1) (a).We see no substance in the contention that the Government is not competent to enhance the rate of wages mentioned in the proposals published. If it has power to reduce those rates, as desired by the employers, it necessarily follows that it has power to enhance them. There is no merit in the contention that the Government must go on publishing proposals after proposals until a stage is reached where no change whatsoever is necessary to be made in the last proposal made.The contention that the Government has no power to fix different minimum wages for different industries or in different localities is no more available in view of the decision of this Court in M/s. Bhaikusa Yamass Khatriya v. Sangamner Akola Taluka Bidi Kamgar Union, (1963) Supp SCR 524 = (AIR 1963 SC 806  ).The fixation of minimum wages depends on the prevailing economic conditions, the cost of living in a place, the nature of the work to be performed and the conditions in which the work is performed.The contention that it was impermissible for the Government to divide the State into several zones is opposed to Section 3 (3) as well as to the scheme of the Act.On the basis of the material before us we are unable to say that the various zones had not been made on any rational basis. The Government has given good reasons in support of the steps taken by it. Bangalore is the capital of the State and Mangalore is a major port. Therefore they may stand on a different footing. In matter like the preparation of zones we have to trust the State Government unless it is shown that collateral considerations have influenced its decision. No such plea was taken. The argument based on cost of living index showing that cost of living index was higher in several other towns in the State than Bangalore or Mangalore is not a well-founded argument. The cost of living is one thing, cost of living index is another. What is relevant is the former and not the latter. The latter depends on the base year, which is not the same in all the towns and the prices of certain selected goods in each of the towns concerned in the base year and thereafter which again is likely to differ from town to town.The contention relating to the value of the food that may be supplied to the employee is not merely petty, it is misconceived as well. For example the employers contend that a minimum wage of Rs. 80 per month in Bangalore and Mangalore for a cleaner is excessive; at the same time they assert that the computation of the value of the food to be supplied to him at Rs. 40 per month is not adequate. They fail to see the obvious contradictions in those pleas. In fixing minimum wages, a family of three members has to be taken into consideration. Further the food is not the only item taken into consideration. We have earlier referred to the other components of a minimum wage. Therefore if the value of the food supplied has to be increased, minimum wages also will have to be increased. Further the impugned notification does not authorise under Section 11 (2) the payment of any portion of wages in kind.It merely says that if the employer supplies free meals to any employee, he may deduct the sum mentioned in the notification. It is only an option given and not a duty imposed. Therefore the procedure prescribed in Rule 21 of the Rules framed under the Act is inapplicable to the facts of the case before us. The relevant rule is Rule 22 (2) (v) i.e., the valuation of an amenity. We fail to see why the supplying of food is not an amenity.