Bombay High Court
Institute For Design Of ... vs Kamgar Utkarsha Sabha on 20 April, 2016
Bench: S.C. Gupte
Chittewan 1/7 1. WP 415-16 & 425-16.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.415 OF 2016
WITH
WRIT PETITION NO.425 OF 2016
Institute of Design of Electrical Measuring
Instruments, Swatantrayaveer Tatya Tope
Marg, Chunabhatti, Sion P.O.
Mumbai-400 022 .. Petitioner
Versus
Kamgar Utkarsha Sabha
Smt. Rama Gulab Joshi Niwas,
Parleshwar Marg,
Vile Parle (East), Mumbai-400 057. .. Respondent
ig .....
Mr. V.P. Vaidya i/b Mr. M.M. Agavekar for the Petitioner.
Mr. Pradyumna M. Mokashi for the Respondent.
.....
CORAM : S.C.GUPTE, J.
DATE : 20 APRIL 2016.
(Oral Judgement)
. Heard Learned Counsel for the parties. Rule. By consent the
Petition is taken up for hearing forthwith.
2 This Writ Petition challenges a common order passed by the
Industrial Court at Mumbai on several complaints under the Maharashtra
Recognition of Trade Unions & Prevention of Unfair Labour Practices Act,
1971 ("MRTU & PULP Act"). The order was on a preliminary issue as to
whether the Central Government is the appropriate government in relation
to any industrial dispute concerning the Petitioner under the Industrial
Disputes Act, 1947 ("ID Act"). If any establishment is not an industry,
concerning which the appropriate government is the Central Government
Chittewan 2/7 1. WP 415-16 & 425-16.doc
under the ID Act, the provisions of MRTU & PULP Act, do not apply to
such establishment.
3 The autonomous body, with whom we are concerned in the present
case, is the Institute for Design of Electrical Measuring Instruments,
Mumbai, which is the Petitioner before this Court. It is the case of the
Petitioner that under the amended definition of the "appropriate
government" under the ID Act, the Institute being an autonomous body
owned or controlled by the Central Government, the Central Government
is the appropriate government with respect to the Petitioner, for any
industrial dispute arising under that Act. On the basis of this submission,
entertain the complaints
the Petitioner objected to the jurisdiction of the State Industrial Court to
under the MRTU & PULP Act against it. A
preliminary issue was accordingly framed as to whether the Central
Government is the appropriate government with respect to the Petitioner-
Institute. Evidence was led by both parties on the preliminary issue. By
its impugned order dated 18 December 2015, the Industrial Court
answered the preliminary issue in the negative, thereby upholding the
jurisdiction of the State Industrial Court to entertain an application against
the Petitioner Institute under the MRTU & PULP Act.
4 In its impugned order, the Industrial Court basically came to a
conclusion that the appropriate government with reference to the
Petitioner-Institute was the State Government and not the Central
Government. The Industrial Court came to this conclusion after
considering the Memorandum of Association of the Petitioner-Institute for
management of the Institute including provisions as to its Governing
Council, control of its finances and their Audits and also the service
Chittewan 3/7 1. WP 415-16 & 425-16.doc
conditions of its employees. What is mainly considered by the Industrial
Court to arrive at its conclusion that the Petitioner-Institute is not owned or
controlled by the Central Government is that the Central Government was
not the drawing or disbursing authority for payment of wages to the
Petitioner-Institute's workers. The Industrial Court found that the Central
Government had not provided even the grant in aid to the Petitioner-
Institute for disbursing any wages.
5 At the hearing of the Petition, Learned Counsel for the Petitioner
submits that considering the provisions of the Memorandum of Association
of the Petitioner-Institute, as also considering the fact that the Petitioner-
Institute has been notified by the Central Government under Section 14 (3)
of the Administrative Tribunals Act, 1985 as a local or other authority or
society controlled by the Central Government, at least this much is clear
that the Petitioner-Institute is controlled by the Central Government.
Learned Counsel, relying on the judgment in the case of Administrative
Officer, Central Electro Chemical Research Institute Vs. State of Tamil
Nadu1, submits that the notification issued under Section 14 (3) of the
Administrative Tribunals Act, 1985 is determinative of the fact that the
appropriate government in respect of such notified bodies, is the Central
Government.
6 On the other hand, it is submitted by Learned Counsel for the
Respondent that the notification under Section 14 (3) of the Administrative
Tribunals Act, 1985, is not per se decisive of the issue, as to whether or
not the relevant body is owned or controlled by the Central Government
within the meaning of the definition of the appropriate government under
1 1990 LAB.I.C. 1815.
Chittewan 4/7 1. WP 415-16 & 425-16.doc
Section 2(a) of the ID Act. It is submitted that evidence on record clearly
shows that the Central Government does not have any deep or pervasive
control or even a functional control over the Petitioner-Institute. It is
submitted that at the best the Central Government has a regulatory control
over the Petitioner-Institute, Ministry of Micro, Small and Medium
Enterprises, Government of India being the administrative ministry of the
Petitioner-Institute. It is submitted that the Central Government does not
offer any grant to the Institute; that the expenses of the Institute are borne
from funds raised by the business of the Institute; and that even the wages
paid to its employees as also the expenses for its administration and
business are funded by the Institute. It is submitted that there is no
financial control exercised by the Central Government in respect of the
affairs of the Petitioner-Institute.
7 In the first place, considering the definition of the appropriate
government in the two enactments, namely, the Administrative Tribunals
Act, 1985 and the Industrial Disputes Act, 1947, which are pari materia in
the relevant context, and particularly, the words "society owned or
controlled by the Government" used in both the definitions, the fact that by
a Central Notification, which is issued under Section 14(3) of the
Administrative Tribunals Act, 1985 only in respect of bodies or societies
owned or controlled by the Central Government, the Petitioner-Institute is
notified by the Central Government is at least a strong piece of evidence,
if not anything else, to show that the Petitioner-Institute is controlled by
the Central Government. But quite apart from this evidence, the existence
of which would normally throw the burden on the other side to show
otherwise, there is also the evidence in the form of the Memorandum of
Association, Rules and Regulations of the Petitioner-Institute that it is
Chittewan 5/7 1. WP 415-16 & 425-16.doc
clearly controlled by the Central Government. In the first place, the Rules
and Regulations of the institute are issued by the Ministry of Industrial
Development, Internal Trade & Company Affairs (Department of Industrial
Development), Government of India. The Rules provide for composition
of the Society with the following members, namely, "President", who is
nominated by the Government of India from amongst the members of the
Society, "members of the Governing Council", all of whom are appointed
by the Government of India from various categories mentioned therein and
"any other person or persons" appointed by the Government of India.
That means every member of the Society is a Central Government
appointee. The Governing Council of the Petitioner-Institute is also
appointed by the Government of India and acts in accordance inter alia
with orders/directives received from the Government of India from time to
time. The Government of India is empowered to terminate the membership
of any member or at one and the same time of all members other than the
ex-officio members of the Governing Council and to fill in such vacancies
after such termination. Notwithstanding anything contained in any of these
Rules and Regulations, the Government of India has the power to issue
such directives or instructions as it may think fit in regard to the finances
and conduct of business and affairs of the Society and the members of
the Governing Council are bound to comply with, and give effect to, such
directives or instructions. The Governing Council has control over the
management of the affairs and funds of the society and has authority to
exercise all the powers of the society subject to such limitations in respect
of the expenditure as the Government of India may from time to time
impose. The accounts of the Society are audited annually the Auditors
appointed by the Government of India. The Auditors appointed in
connection with the audit of the accounts of the Society have the same
Chittewan 6/7 1. WP 415-16 & 425-16.doc
rights, privileges and authorities as the Controller & Auditor General has
in connection with the audit of Government Accounts. None of the Rules
and Regulations of the Society can be amended, except after obtaining an
appropriate sanction of the Government of India. The Society cannot be
dissolved without the consent of the Government of India. All these are
clear indications that the Government of India exercises a complete
financial and administrative control, in addition to regulatory control, over
the affairs of the Petitioner-Institute.
8 Unfortunately, none of these ingredients has been considered by the
Industrial Court in its impugned order. In the impugned order, the
Industrial Court rather goes by lack of documentary evidence to show in
what manner the Government of India actually exercised control over the
Institute. It also goes by some other indices such as salaries of
employees of the Society and its expenses being made through its own
funds. It is not the sole characteristic of a society owned or controlled by
the Central Government that the Government must actually fund its
activities including disbursement of salary to its employees out of
government funds or extend any government aid. It may well be that the
society or establishment generates its own income and funds its activities
and pays salaries to its employees from such income. The issue as
regards the notification issued by the Central Government in respect of the
Petitioner-Institute under Section 14(3) of the Administrative Tribunals Act
has been perfunctorily dealt with by the Industrial Court by observing that
merely the name of the Petitioner-Institute is shown in the list of
autonomous corporations or societies in the notification dated 25 October
2007 No.GI.PER and TRG., Notification NOTEN-P-13030/1/2007 AT.
Chittewan 7/7 1. WP 415-16 & 425-16.doc
9 In the premises, the impugned order dated 18 December 2015 of
the Industrial Court suffers from grave infirmity. There is adequate
evidence on record to conclusively show that the Petitioner-Institute is an
autonomous body owned or controlled by the Central Government and
accordingly, it is the Central Government which is the appropriate
government in respect of the Petitioner-Institute.
10 Learned Counsel for the Respondent relied upon some judgments
of the Supreme Court on the definition of 'appropriate government', all of
which have been rendered prior to the amendment of the definition of the
"appropriate government" under Section 2(a) of the ID Act. 1947. Prior to
that amendment, the question was whether a particular institute is carried
on by or under the authority of the Central Government. Now after the
definition is amended, several categories have been added to these
entries, including autonomous bodies owned or controlled by the Central
Government. As I have noted above, the Petitioner-Institute can clearly
be termed as an autonomous body owned or controlled by the Central
Government.
11 In the premises, Rule is made absolute and the impugned order of
the Industrial Court dated 18 December 2015 is quashed and set aside.
12 On the application of learned Counsel for the Respondent, the ad-
interim order operating in Complaint (ULP) No.18 of 2015 is continued for
a period of six weeks from today.
(S.C.GUPTE, J.)
