Case: Indian Express Newspapers (P) Ltd. Etc. Etc Vs. Union Of India And Others Etc. Etc

4. The Act as it was initially enacted was titled the Working Journalists (Conditions of Service) and Miscellaneous Provisions Act, 1955 (the original Act) since it was confined to the service conditions of the working journalists only. By an amendment brought into force onby the Working Journalists and Other Newspaper Employees (Conditions of Service) and Miscellaneous Provisions (Amendment) Act, 1974, the scope of the original Act was expanded to included the other newspaper employees. Under the original Act, which was confined to the working journalists only, a Board headed by Shri Divatia was appointed under Section 9 of the Act, and the said Board gave its award in May 1957 which is known as Divatia Award. The recommendations made by the said Board and the provisions of the Act were challenged by some establishments including some of the petitioners herein, under Article 32 of the Constitution, and these challenges were dealt with in the decision of this Court in Express Newspapers (P) Ltd. v. Union of India by a Constitution Bench of five learned Judge. To this decision, we may have occasion to refer later. Suffice it to say for the present that certain propositions of law which were laid down by this decision were followed not only by the later wage boards appointed under the Act but by all industrial adjudicators in the country5. After the Divatia Wage Board, three more wage boards were appointed, viz., Bhandarkar Wage Board, Shinde Wage Board and Palekar Wage Board in 1958, 1963 andrespectively. They gave their respective awards in 1959, 1967 and 1980. They followed the principles laid down in the aforesaid decision of this Court. Then came the present wage board, viz., Bachawat Wage Board and its impugned award6. Before we discuss the challenges to the impugned award, it will be necessary to examine the relevant provisions of the Act, the changes brought about in the Act after the decision in Express Newspapers case and the propositions of law laid down in the aforesaid decision7. Section 2(d) defines "newspaper establishment" to mean"(d) newspaper establishment means an establishment under the control of any person or body of persons, whether incorporated or not, for the production or publication of one or more newspapers or for conducting any news agency or syndicate; [and includes newspapers establishments specified as one establishment under the ScheduleExplanation.For the purposes of this clause,(a) different departments, branches and centres of newspaper establishments shall be treated as parts thereof;(b) a printing press shall be deemed to be a newspaper establishment if the principal business thereof is to print newspaper];" * The Schedule referred to above states as follows"1. For the purposes of clause (d) of Section 2,(1) two or more newspaper establishments under common control shall be deemed to be one newspaper establishment;(2) two or more newspaper establishments owned by an individual and his or her spouse shall be deemed to be one newspaper establishment unless it is shown that such spouse is a sole proprietor or partner or a shareholder of a corporate body on the basis of his or her own individual funds;(3) two or more newspaper establishments publishing newspapers bearing the same or similar title and in the same language in any place in India or bearing the same or similar title but in different languages in the same State or Union Territory shall be deemed to be one newspaper establishment2. For the purposes of paragraph 1(1), two more establishments shall be deemed to be under common control(a) (i) where the newspaper establishments are owned by a common individual or individuals;(ii) where the newspaper establishments are owned by firms, if such firms have a substantial number of common partners;(iii) where the newspaper establishments are owned by bodies corporate, if one body corporate is a subsidiary of the other body corporate, or both are subsidiaries of a common holding company or a substantial number of their equity shares are owned by the same person or group of persons, whether incorporated or not;(iv) where one establishment is owned by a body corporate and the other is owned by a firm, if a substantial number of partners of the firm together hold a substantial number of equity shares of the body corporate;(v) where one is owned by a body corporate and the other is owned by a firm having bodies corporate as its partners if a substantial number of equity shares of such bodies corporate are owned, directly or indirectly by the same person or group of persons, whether incorporated or not, or(b) where there is functional integrality between concerned newspaper establishments."The bracketed addition in Section 2(d) and the Schedule referred to therein were inserted by the Amending Act 31 of 1989 which came into force retrospectively onThe provisions of Section 2(i) of the said Amending Act in terms state that the said bracketed portion "shall be deemed always to have been inserted at the end" of the original Section 2(d) of the Act. Section 8 and Sectiongive power to the Central Government to fix rates of wages in respect of working journalists andnewspaper employees respectively, and to revise from time to time the rates of wages fixed, at such intervals as it may think fit. Section 9 and Sectionlay down the procedure for fixing or revising the rates of wages in respect of working journalists andnewspaper employees respectively, and they state that for the purpose, the Central Government shall as and when necessary, constitute a wage board.(1) of Section 10 read with Sectionlays down the procedure which the wage board is required to follow while fixing or revising the rates of wages. The provision says that the Board shall, by notice published in such manner as it thinks fit, call upon all interested persons to make such representations as they may think fit as respects the rates of wages which may be fixed or revised under this Act.(2) of Section 10 states that every such representation shall state the rates of wages, which in the opinion of the person making the representation, would be reasonable, having regard to the capacity of the employer to pay the same or to any other circumstances, whichever may deem relevant to the person making the representation.(3) thereof states that the Board shall take into account the representations so made and after examining the materials placed before it, make such recommendations as it thinks fit to the Central Government for the fixation or revision of rates of wages and any such recommendation may specify when, prospectively or retrospectively, it should take effect.(4) thereof makes an important provision. It enjoins upon the Board while making the recommendations to the Central Government, to have regard to the cost of living, the prevalent rates of wages for comparable employment, the circumstances relating to the newspaper industry in different regions of the country and to any other circumstances which to the Board may seem relevant. An Explanation was added to the said(4) by the same Amending Act of 1989 which has a bearing on one of the challenges made to the impugned Award. It states"Explanation.For the removal of doubts, it is hereby declared that nothing in thisshall prevent the Board from making recommendations for fixation or revision of rates of wages on All India basis." *(1) of Section 12 gives power to the Central Government to make an order in terms of the recommendations made by the Board or subject to such modifications as it thinks fit, being modifications which in the opinion of the Central Government, do not effect important alterations in the character of the recommendations.(2) thereof gives power to the Central Government to make such modifications in the recommendations, not being modifications of the nature referred to in(1), as it thinks fit, after giving to all persons likely to be affected thereby an opportunity to make representations or to refer the recommendations or any part thereof to the Board, as it thinks fit.(3) states that every order made by the Central Government together with the recommendations of the Board shall come into operation on the date of publication or on such date, whether prospective or retrospective, as may be specified in the order. Section 13 read with Sectionstates that on the coming into operation of the order of the Central Government under Section 12, every working journalist andnewspaper employee shall be entitled to be paid by his employer wages at the rate which shall in no case be less than the rates of wages specified in the order. Sectiongives power to the Central Government to fix interim rates of wages after consulting the Wage Board8. We may now refer to the propositions of law laid down by this Court in the decision in Express Newspapers Ltd. case. They are, among others, as follows(1) For the fixation of rates of wages which include within its compass, the fixation of scales of wages also, the capacity of the industry to pay is one of the essential circumstances to be taken into consideration except in cases of bare subsistence or minimum wages where the employer is bound to pay the same irrespective of such capacity. Under the provisions of the Act, it is not only open to, but incumbent upon the Wage Board to consider the capacity of the industry to pay, an an essential circumstance(2) The capacity of the industry to pay is to be considered on anbasis after taking a fairof the industry(3) The proper measure of weighing the capacity of the industry to pay should take into account the elasticity of the demand for the product, the possibility of tightening up the organisation so that the industry could pay higher wages without difficulty and the possibility of increase in the efficiency of the lowest paid workers, resulting in increase in production, considered in conjunction with the elasticity of the demand for the product against the ultimate background that the burden of the increased rate should not be such as to drive the employer out of business(4) The provisions of the Act as they stood then were not violative of the fundamental rights enshrined in Articles 14 and 19(1)(a) and 19(1)(g) of the Constitution which provided for classification. The classification of the newspaper establishments on the basis of the gross revenue earned is not bad(5) The grouping of the newspaper establishments into chains or multiple units is justified having regard to the conditions of the newspapers industry in he country. There is nothing in the Act which militates against such grouping. The real difficulty however in the matter of grouping into chains or multiple units arises in connection with the capacity of the industry to pay. If a classification on the basis of gross revenue would be legitimately adopted by the Wage Board, the grouping into chains or multiple units could also be made. There is nothing in the Act to prohibit the treating of several newspaper establishments producing or publishing one or more newspapers, though in different parts of the country, as one newspaper establishment for the purpose of fixing the rates of wages. It would not be illegitimate to expect the same standard of employment and conditions of service in several newspaper establishments under the control of any person or body of persons whether incorporated or not. For an employer to think of employing one set of persons on higher scales of wages and another set of workers on lower scales of wages would by itself be inequitous, though it would be quite legitimate to expect the difference in scales having regard to the quality of the work required to be done, the conditions of labour in different regions of the country, the standard of living in those regions and other cognate factors. All these conditions would necessarily have to be borne in mind by the Wage Board in arriving at its decision is regard to the wage structure though the relative importance to be attached to one set or the other, may vary in accordance with the conditions in different areas or regions where the newspapers establishments are located(6) If the industry is divided into different classes, it may not be necessary to consider the capacity of each individual unit to pay. It would certainly be necessary to consider the capacity of the respective classes to bear the burden imposed on them. Aof these respective classes may have to be taken for careful examination and all relevant factors may have to be borne in mind in deciding what burden the class considered as a whole can bear9. It is necessary to note some significant amendments which were made to the original Act after the aforesaid decision. The first such amendment, as stated above, was to include within the scope of the Act, thenewspaper employees. The second amendment was to the definition of "newspaper establishment" in Section 2(d) and as pointed out earlier, it was the addition of the bracketed portion in the said definition and the Schedule. With this amendment, different departments, branches and centres of a newspaper establishment were treated as a part of the same establishment and even a printing press, whose principal business was to print newspaper, was also deemed to be a newspaper establishment. As per the Schedule introduced, (i) two or more newspaper establishments under common control were deemed to be one newspaper establishment; (ii) two or more newspaper establishments publishing newspapers bearing the same or similar title and in the same language in any place in India or bearing the same or similar title, but in different languages in the same State or Union Territory, were also deemed to be one newspaper establishment; and (iii) two or more establishments owned by an individual and his or her spouse were also deemed to be one newspaper establishment, unless it was shown that such spouse was the sole proprietor or partner or a shareholder in a corporate body on the basis of his or her own individual funds. The third amendment was an addition of Explanation to Section 10(4) [former Section 9(1)], enabling the Board to make recommendations for fixation or revision of rates of wages onbasis. It has to be noted that this amendments was made after the publication of the award impugned in the present case

Court's reasoning:
This has manifestly resulted in the weaker units of the newspaper establishments belonging to the said classes being ranked with the highest in the same class, thus, crippling the weaker units with the heavy unbearable financial burden and forcing them to close. Such classification directly offends the petitioners rights under Articles 19(1)(a) and 19(1)(g) of the Constitution12. Among the other infirmities which are pointed out in the impugned award, the first that while classifying the establishments, the benefit of paragraph 12 of Section II of Part I of Chapter IX is not given to them by ascertaining whether their advertisement revenue is less or more than 45 per cent of its gross revenue. If this was done and where it was found that it was less than 45 per cent of the gross revenue, the establishments concerned would have been placed in the class next below that in which they are classified on the basis of their gross revenue. Secondly, the award while calculating the financial capacity, has made no provision even for a reasonable depreciation and to that extent the estimates of the capacity of the establishments to pay are seriously flawed. Thirdly, the award has not considered the burden of retrospective effect it has given to its recommendations fromThe burden on the establishments from89 is enormous and the Board wasto calculate the said burden to find out whether the establishments were capable of bearing the same. Lastly, the award has also not taken into consideration the costs of newsprint which had in the meanwhile gone up by about 76.6 per cent13. We find much substance in the contention that the Board has arbitrarily clubbed together the different units of the same establishment and classified all of them with the highest of the class to which itsunit belongs so are as Classesto V are concerned and has not followed in respect of those classes, its own guideline given in the said paragraph 6(2) in respect of the establishments which belong to Classes VI to IX. The Wage Board in paragraph 11 of Section II of Part I of Chapter IX of its Report has classified the different newspaper establishments on the basis of their gross revenueto us, in view of the definition of "newspaper establishment" in section 2(d) and the Explanation to Section 10(4) of the Act and also in view of the fifth and sixth propositions of law laid down by this Court in Express Newspapers case as extracted above, the units of an establishment which as branches all over India, can be clubbed together for the purpose of fixation of wages onbasis. Since all the units of an establishments are not expected to fare similarly, uniform pay scales for the employees in all the units can be prescribed taking into consideration the financial capacity of the establishment as a whole. The instances pointed out above are the result of the clubbing of the different units of the same establishment15. However, there is much force in the contention of the petitioners that the principle of fixation of the wages onbasis has not been applied by the Board with uniform yardstick as is evident from paragraph 6(2) of Section II of Part I of Chapter IX of the Report. Whereas the units of the newspaper establishments falling in any of the Classes VI to IX, as detailed above, on the basis of their own gross revenue are, for the fixation of wages not to be stepped up by more than two classes, the units of the newspaper establishments falling in Classesto V are all to be classified as belonging to the class to which the said establishment belongs on the basis of the gross revenue of all the said units. The result of this discrimination is that for the purposes of fixing the wage scales, the units of the newspaper establishments belonging to Classes VI to IX would not be considered as belonging to the said classes but to the classes which are only two grades above the class to which the said units on the basis of their own revenue properly belong. On the other hand, the units of the establishments belonging to Classesto V would all be considered as belonging to the class to which the establishment itself belongs. The Board has not given any reason as to why while applying the principle of uniform wage scales to all units of an establishment onbasis, it has made the discrimination in question between the newspaper establishments belonging to Classesto V and those belonging to Classes VI to IX. The respondents also could not offer any satisfactory explanation or advance a plausible contention to defend the said discrimination. We are, therefore, of the view that the impugned award to be made legally enforceable will have to be modified by extending the limitation of upgradation up to the maximum of two classes laid down in the said para 6(2) also to the newspapers establishments falling in Classesto V16. As regards the other grounds of attack, we are afraid we see no reason to interfere with the award on the said grounds. In view of the amended definition of the "newspaper establishment" under Section 2(d) which came into operation retrospectively from the inception of the Act and the Explanation added to Section 10(4), and in view further of the fact that in clubbing the units of the establishment together, the Board cannot be said to have acted contrary to the law laid down by this Court in Express Newspapers case the classification of the newspaper establishments onbasis for the purpose of fixation of wages is not bad in law. Hence it is not violative of the petitioners rights under Articles 19(1)(a) and 19(1)(g) of the Constitution. Financial capacity of annewspaper establishment has to be considered on the basis of the gross revenue and the financial capacity of all the units taken together. Hence, it cannot be said that theia newspaper establishments are not viable whatever the financial incapacity of their individual units. After amendments of Section 2(d) retrospectively read with the addition of the Explanation to Section 10(4), the old provisions can no longer be pressed into service to contend against the grouping of the units of theestablishments, into oneMore or less similar contentions were raised on behalf of otherWe have made clear at the very outset that some of these contentions raised disputed questions of facts and others, mixed questions of facts and law and hence we will not entertain them. In addition, as far as Indian Express Newspapers (Pvt.) Ltd. is concerned the record shows that the said petitioners had not produced by material before the Board in support of its aforesaid contentions which are for the first time advanced before this Court. In fact, the company had virtually boycotted the proceedings of the Board