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Judgment
K. Ravichandrabaabu, J.—This writ appeal is directed against the order of the learned single Judge made in W.P. No. 15406 of 2000
dated 21.1.2010. The appellant is the writ petitioner. The appellant challenged the order of the first respondent herein dated 24.8.2000 in the writ
petition. Through the said communication, the first respondent informed the appellant that their Society registered under the Multi State Co-
operative Societies Act 1984 comes under the control of the State Government and that there is no over riding provisions stating that the Industrial
Employment Standing Orders Act 1946 will not apply to the establishments registered under the Multi State Co-operative Societies Act, 1984.
Therefore, the first respondent requested the petitioner/appellant to follow the provisions laid down under the Industrial Employment Standing
Orders Act, 1946. The learned single Judge dismissed the writ petition by rejecting the contention of the appellant with cost of Rs. 5,000/-
The case of the appellant as the writ petitioner before the learned single Judge is as follows:-
Appellant Society is a Multi State Co-operative Society established in the year 1907. The Society comprises the Railwaymen working in the
States of Tamil Nadu, Andhra Pradesh, Karnataka, Maharashtra and Goa as its members. It is deemed to be a registered society under the Multi
State Co-operative Societies Act, 1984. The All India Multi Society Employees Association addressed a letter to the petitioner during August
1996, requesting them to frame and submit draft Standing Orders u/s 3 of the Industrial Standing Orders Act, 1946 providing for the service
conditions of its employees. The petitioner replied by stating that their employees are governed by the regulations framed under the Multi State Co-
operative Societies Act and therefore the question of applying the Industrial Standing Orders Act would not arise. Hence the said Association sent
a petition to the first respondent and based on which an enquiry was conducted wherein the petitioner submitted a detailed submissions. Again, a
notice was issued on 28.2.2000 requiring the petitioner to forward certain communications received from the Department of Agriculture, Govt. of
India. The petitioner submitted a detailed letter on 6.3.2000 reiterating their earlier contentions. They also enclosed a letter dated 28.1.1997 issued
by the Department of Agriculture, Government of India under which the Government of India has stated that the employees of the petitioner
Society would be governed by the regulations framed u/s 42(2)(e) of the Act and that the said Regulations need not be certified under the
Industrial Employment Standing Orders Act, 1946. While that being the position, the impugned communication was issued by the first respondent
requiring the petitioner to follow the provisions laid down under the Industrial Employment Standing Orders Act, 1946. Thus, aggrieved against the
said communication, the above writ petition came to be filed.
The first respondent resisted the said writ petition by filing a counter affidavit wherein it is stated as follows:-
By virtue of Section 42(2)(e) of the Multi State Co-operative Societies Act, 1984, the Board cannot frame all the service conditions and the
matters set out under the Industrial Employment (Standing Orders) Act, 1946, since the said provisions are only illustrative and not exhaustive. The
Industrial Employment (Standing Orders) Act, 1946 is a special Act, which will prevail over the Multi State Co-operative Societies Act, 1984.
The object of the Industrial Employment (Standing Orders) Act, 1946 is to require the employers to make the conditions of employment precise
and definite and therefore the same is applicable to the writ petitioner''s establishment.
The learned single Judge, after hearing both sides, has found that the petitioner society is a commercial establishment within the meaning of the
Tamil Nadu Shops and Establishments Act, 1947 and once it is held that the petitioner is an ""industrial establishment"" under the Payment of Wages
Act, then automatically Section 3(e)(1) of the Standing Orders Act, 1946, will get attracted. The learned Judge further observed that insofar as
having Certified Standing Orders are concerned, the provisions of the Standing Orders Act will prevail as it is a special law. The learned Judge
also observed that the bye-laws/regulations framed by the Board u/s 42(2)(e) of the Multi State Co-operative Societies Act 1984 or under the
subsequent enactment cannot have an overriding effect. Thus, the learned Judge dismissed the writ petition also by imposing a cost of Rs. 5,000/-
on the petitioner.
Mr. R. Muthukumarasamay, learned Senior Counsel appearing for the appellant submitted as follows:-
The definition of ""industrial establishment"" as defined under the Payment of Wages Act, 1936 has to be confined only in respect of sub-clause (a)
to (f) alone therein and cannot be extended to sub-clause (h) which came to be introduced later by way of amendment. Insofar as the appellant''s
case is concerned the appellant Society will not fall within the meaning of commercial establishments. Appropriate Government is only the central
Government, since Multi State Co-operative Society is controlled by Central Government. The appellant is a self financing society.
The learned Senior Counsel invited our attention to various provisions of law under the Multi State Co-operative Societies Act, 2002, The
Industrial Employment (Standing Orders) Act, 1946 and the Payment of Wages Act, 1936 to contend that the appellant is not a commercial
establishment nor an industrial establishment within the meaning and definition of Section 2(a) to (f) of the Payment of Wages Act, 1936, so as to
attract the provisions under the Industrial Employment (Standing Orders) Act, 1946. He also submitted that the first respondent being the authority
under the State Government has no power to issue the impugned communication. The decisions relied on by the learned single Judge are in respect
of Industrial Disputes Act, 1947 and therefore the same cannot be applied to the facts and circumstances of the present case. The Industrial
Employment (Standing Orders) Act, 1946 is not supplemental to the Payment of Wages Act, 1936.
In support of his submissions, the learned Senior Counsel relied on the following decisions:-
1) Valsad Jilla Sahakari Bank Ltd. Vs. D.K. Patel and Others,
2) Bharat Co-Operative Bank (Mumbai) Ltd. Vs. Co-Operative Bank Employees Union,
3) Girnar Traders Vs. State of Maharashtra and Others,
Per contra, Mrs. Nagasaila appearing for the 4th respondent submitted as follows:-
The Multi State Co-operative Societies Act 2002 is a general Act and the Industrial Employment (Standing Orders) Act, 1946 is a special Act as
far as the conditions of the employment is concerned. The interpretation sought to be given by the appellant that the definition clause in the Standing
Orders Act being legislation by incorporation and so the subsequent amendment in the Payment of Wages Act does not affect the definition in the
Standing Orders Act is untenable because such an interpretation would defeat the object of all the labour welfare legislations. Therefore, such
legislation is to be held as legislation by reference rather than legislation by incorporation. The appellant is a commercial establishment as defined
u/s 2(3) of the Tamil Nadu Shops and Establishments Act, 1947. The Standing Orders Act applies to every industrial establishment wherein one
hundred or more workmen are employed or were employed. Merely because the appellant is registered under the Multi State Co-operative
Societies Act, it dose not make it an industrial establishment under the control of the Central Government. In support of her submissions, the
learned counsel relied on the following decisions:-
1) Life Insurance Corporation of India Vs. D.J. Bahadur and Others,
2) The Tamil Nadu Water Supply and Drainage Board and Another Vs. M.D. Vijayakumar and others,
3) The State of Madhya Pradesh Vs. M.V. Narasimhan,
4) Western Coalfields Limited Vs. Special Area Development Authority, Korba and Another,
5) 2006(3) SLJ 461 Delhi (Indian Airlines Vs. Union of India and others)
6) The George Town Co-operative Bank Limited Vs. The Deputy Commissioner of Labour (Appellate Authority under Tamil Nadu Shops and
Establishments Act), N.G. Seetharaman, N.S. Rani and N.S. Gunalan
7) Tata Memorial Hospital Workers Union Vs. Tata Memorial Centre and Another,
8) Bharat Co-Operative Bank (Mumbai) Ltd. Vs. Co-Operative Bank Employees Union,
Heard the learned counsel on either side and perused the materials as well as the case laws cited by the respective parties.
The appellant is the Co-operative Credit Society registered under the Multi State Co-operative Societies Act, 1984 (Central Act 51 of 1984).
The appellant is aggrieved against the communication sent by the first respondent whereby the appellant Society was called upon to follow the
provisions laid down under the Industrial Employment (Standing Orders) Act, 1946. By the impugned communication, the first respondent also
found that the appellant Society comes under the control of the State Government. This communication is challenged by the appellant by
contending
(i) that the provisions of the Standing Orders Act will not apply to the appellant as it is a multi-State Co-operative Society registered under the
Central Act 51/1984;
(ii) that the appropriate Government in respect of the appellant society is only the Central Government and therefore the first respondent herein has
no jurisdiction to send the impugned communication;
(iii) that the appellant is not an industrial establishment as defined u/s 2(e)(i) of the Standing Orders Act and
(iv) that the appellant Society is governed by the Multi State Co-operative Societies Act, 1984 (since replaced by the Multi State Co-operative
Societies Act, 2002), which is a special Act and not governed by the Standing Orders Act, 1946.
By raising the above contentions the appellant filed the writ petition and the same was dismissed by the learned single Judge by holding that the
appropriate Government in respect of a multi-state Co-operative Society is only the State Government. For arriving at such a conclusion, the
learned single Judge relied on the decision of the Apex Court reported in Bharat Co-Operative Bank (Mumbai) Ltd. Vs. Co-Operative Bank
Employees Union, . In the above said decision, the Apex Court at paragraph No. 30 has observed that the definition of ""banking company"" will
have to be read as it existed on the date of insertion of Section 2(bb) of the I.D. Act and so read, the ""appropriate Government"" in relation to a
multi-State Co-operative bank carrying on business in more than one State, would be the State Government.
The learned Senior Counsel appearing for the appellant submitted that the above decision made by the Apex Court in respect of Industrial
Disputes Act cannot be applied to the case on hand which is in respect of a society registered under the Multi-State Co-operative Societies Act,
1984. The learned Senior Counsel further contended that only the Central Government is the appropriate Government.
We are unable to appreciate such a contention of the learned Senior Counsel, in view of the categorical observation of the Apex Court in
Bharat Co-operative Bank (Mumbai) Ltd., case cited supra, that a multi-State Co-operative Bank carrying on business in more than one State is
governed by only the State Government being the appropriate Government.
No doubt the said decision was rendered in respect of I.D. Act, 1947. But at the same time, the very similar multi-State Co-operative Bank
was under consideration in the above said case and the Apex Court has found that the appropriate Government in respect of such multi-State Co-
operative Bank was only a State Government. At this juncture, it should be noted that the object of carrying on the business by such multi-State
Co-operative Bank may be at different States of this country. But that itself does not confer the jurisdiction of the Central Government on such
Multi State Co-operative Bank. More over the appellant''s own conduct would falsify their stand as rightly pointed out by the learned counsel
appearing for the fourth respondent. In a writ petition in W.P. No. 19136 of 2011 filed by the very same appellant against the RTI proceedings,
the appellant herein in its affidavit filed therein in support of the said writ petition, contended that the Society is governed by its bye-laws in terms of
which the Society is a body corporate and its management vests in the Board of Directors comprising of its own members elected by the General
Body. It is specifically contended that neither the Central Government nor the State Government has any role in the governance and administration
of the petitioner society.
The learned counsel for the fourth respondent also relied on the decision of the Apex Court reported in Tata Memorial Hospital Workers
Union Vs. Tata Memorial Centre and Another, wherein the Apex Court while considering the issue as to which is the appropriate Government in
respect of one Tata Memorial Centre, has observed that State Government is the appropriate Government for the said Tata Memorial Centre for
the purposes of the I.D. Act and Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 (in short MRTU
Act). The Apex Court has observed therein that the Governing Council of the Society therein manages the day to day affairs, property funds,
employment of its staff and their conditions of service. Thus by observing so, the Apex Court has ultimately come to the conclusion that only the
State Government is the appropriate Government.
The short facts of the above said case would show that the trustees of a public charitable trust known as Sir Dorabji Tata Trust established the
hospital in Mumbai viz., Tata Memorial Hospital for the treatment and cure of cancer and allied Diseases. The Hospital was being maintained out
of the funds of the Trust and also from the grant made available from time to time by the Central Government. The trustees of the said Trust
subsequently decided to dedicate the Hospital to the nation with all its assets and thus they requested the Government of India to take over its
control and management. Accordingly, an agreement was entered into between the trustees and the Central Government wherein under clause (2),
the management of the Hospital was to rest in the hands of Governing Board. Subsequently, another agreement was entered into whereby the Tata
Memorial Hospital and Indian Cancer Research Centre were amalgamated into an institution thereafter known as Tata Memorial Centre.
Therefore, the question that arose for consideration before the Apex Court based on those facts was as to whether the Central Government or the
State Government is the appropriate Government for Tata Memorial Centre. With these factual background, the Apex Court found that only the
State Government is the appropriate Government. Thus, considering the above decisions of the Apex Court reported in Bharat Co-Operative
Bank (Mumbai) Ltd. Vs. Co-Operative Bank Employees Union, and Tata Memorial Hospital Workers Union Vs. Tata Memorial Centre and
Another, we are of the view that the learned Judge has rightly come to the conclusion that the appropriate Government is only the State
Government in the appellant''s case as well.
The next point that arises for consideration is as to whether the appellant Society is an industrial establishment coming within the meaning of
Section 2(e) of the Standing Orders Act. The learned Judge has found that in pursuant to the introduction of sub-section (h) of Section 2 under the
Payment of Wages Act, 1936, the appellant society is an industrial establishment within the meaning and definition of Section 2(e) of the Standing
Orders Act, 1946. It is the contention of the learned Senior Counsel for the appellant that the amendment introduced in 1982 cannot be applied to
the definition of ''industrial establishment'' as found under the Industrial Employment (Standing Orders) Act 1946 since it is a legislation by
incorporation and not a legislation by reference. In support of his submission, the learned Senior Counsel relied on a Division Bench decision of the
Gujarat High Court reported in Valsad Jilla Sahakari Bank Ltd. Vs. D.K. Patel and Others, wherein the Division Bench has observed at
paragraphs 7 and 8 as follows:-
Relying on the principle of incorporation, looking to the aforesaid two decisions, it has to be held that if the meaning of a term is incorporated
from an Act which has been subsequently repealed or has been subsequently amended, the position available as on the date of passing of the
statute wherein the definition has been incorporated from another statute, will prevail and will continue to hold the field and any subsequent changes
in the incorporated statute will not affect the position vis-�-vis the statute in which the definition is incorporated.
The position, therefore, to be found in the case before us is that when the said Act came to be enacted the meaning of the terms ''industrial
establishment'' was to be understood in accordance with the position available at that time, under the Payment of Wages Act, 1936. That clearly
excluded the petitioner Bank and establishment of that type and as such the order of certifying authority is clearly without jurisdiction.
He further relied on the decision of the Apex Court reported in Girnar Traders Vs. State of Maharashtra and Others, to contend that the
disputed legislation is only a legislation by incorporation and not a legislation by a reference. At paragraphs Nos. 87, 88, 89 the Apex Court has
held as follows:-
However, since this aspect was argued by the learned counsel appearing for the parties at great length, we will proceed to discuss the merit or
otherwise of this contention without prejudice to the above findings and as an alternative plea. These principles have been applied by the courts for
a considerable period now. When there is general reference in the Act in question to some earlier Act but there is no specific mention of the
provisions of the former Act, then it is clearly considered as legislation by reference. In the case of legislation by reference, the amending laws of
the former Act would normally become applicable to the later Act; but, when the provisions of an Act are specifically referred and incorporated in
the later statute, then those provisions alone are applicable and the amending provisions of the former Act would not become part of the later Act.
This principle is generally called legislation by incorporation. General reference, ordinarily, will imply exclusion of specific reference and this is
precisely the fine line of distinction between these two doctrines. Both are referential legislations, one merely by way of reference and the other by
incorporation. It, normally, will depend on the language used in the later law and other relevant considerations. While the principle of legislation by
incorporation has well defined exceptions, the law enunciated as of now provides for no exceptions to the principle of legislation by reference.
Furthermore, despite strict application of doctrine of incorporation, it may still not operate in certain legislations and such legislation may fall within
one of the stated exceptions.
In this regard, the judgment of this Court in the case of The State of Madhya Pradesh Vs. M.V. Narasimhan, can be usefully noticed where the
Court after analyzing various judgments, summed up the exceptions to this rule as follows: (SCC p. 385. para 15)
(a) where the subsequent Act and the previous Act are supplemental to each other;
(b) where the two Acts are in pari materia;
(c) where the amendment in the previous Act, if not imported into the subsequent Act also, would render the subsequent Act wholly unworkable
and ineffectual; and
(d) where the amendment of the previous Act, either expressly or by necessary intendment, applies the said provisions to the subsequent Act.
With the development of law, the legislature has adopted the common practice of referring to the provisions of the existing statute while
enacting new laws. Reference to an earlier law in the later law could be a simple reference of provisions of earlier statute or a specific reference
where the earlier law is made an integral part of the new law, i.e., by incorporation. In the case of legislation by reference, it is fictionally made a
part of the later law. We have already noticed that all amendments to the former law, though made subsequent to the enactment of the later law,
would ipso facto apply and one finds mention of this particular aspect in Section 8 of the General Clauses Act, 1897. In contrast to such simple
reference, legal incidents of legislation by incorporation is that it becomes part of the existing law which implies bodily lifting provisions of one
enactment and making them part of another and in such cases subsequent amendments in the incorporated Act could not be treated as part of the
incorporating Act.
He further relied on the decision of the Supreme Court reported in Bharat Co-Operative Bank (Mumbai) Ltd. Vs. Co-Operative Bank
Employees Union, wherein the Apex Court at paragraph No. 15 has held as follows:-
Before adverting to the said core issue, we may briefly notice the distinction between the two afore-mentioned concepts of statutory
interpretation, viz., a mere reference or citation of one statute in another and incorporation by reference. Legislation by incorporation is a common
legislative device where the legislature, for the sake of convenience of drafting incorporates provisions from an existing statute by reference to that
statute instead of verbatim reproducing the provisions, which it desires to adopt in another statute. Once incorporation is made, the provision
incorporated becomes an integral part of the statute in which it is transposed and thereafter there is no need to refer to the statute from which the
incorporation is made and any subsequent amendment made in it has no effect on the incorporating statute. On the contrary, in the case of a mere
reference or citation, a modification, repeal or re-enactment of the statute, that is referred will also have effect on the statute in which it is referred.
The effect of ""incorporation by reference"" was aptly stated by Lord Esher, M.R. in Wood''s Estate, Ex parte Works and Buildings Commrs., In re
(55 LJ Ch 488(CA) in the following words at page 615:
If a subsequent Act brings into itself by reference some of the clauses of a former Act, the legal effect of that, as has often been held, is to write
those sections into the new Act just as if they had been actually written in it with the pen, or printed in it, and, the moment you have those clauses in
the later Act, you have no occasion to refer to the former Act at all.
In the very same decision, the Apex Court at paragraph No. 21 also observed that the distinction between incorporation by reference and
adoption of provisions by mere reference or citation is not too easy to highlight and that it is matter of probe into legislative intention and/or taking
an insight into the working of the enactment if one or the other view is adopted. Paragraph 21 is extracted hereunder:-
However, the distinction between incorporation by reference and adoption of provisions by mere reference or citation is not too easy to
highlight. The distinction is one of difference in degree and is often blurred. The fact that no clear-cut guidelines or distinguishing features have been
spelt out to ascertain whether it belongs to one or the other category makes the task of identification difficult. The semantics associated with
interpretation play their role to a limited extent. Ultimately, it is a matter of probe into legislative intention and/or taking an insight into the working of
the enactment if one or the other view is adopted. Therefore, the kind of language used in the provision, the scheme and purpose of the Act
assume significance in finding answer to the question. (See: The Collector of Customs, Madras Vs. Nathella Sampathu Chetty and Another, ). The
doctrinaire approach to ascertain whether the legislation is by incorporation or reference is, on ultimate analysis, directed towards that end. (See:
Maharashtra State Road Transport Corporation Vs. State of Maharashtra and Others, ). Thus, the question for determination is to which category
the present case belongs.
In fact, the above decision of the Bharat Co-op. Bank (Mumbai) Limited was relied on by the learned single Judge in this case to hold that the
State Government is the appropriate Government. Thus, by considering the observation of the Apex Court in Bharat Co-op. Bank (Mumbai) Ltd.,
case, it is seen that the question whether a legislation is a mere reference or incorporation is certainly a matter of probe into legislative intention.
When we consider the legislative intention in this case, it could be seen that the Standing Orders Act, 1946 though does not directly define an
industrial establishment"", however, derived cross reference from the definition of an ''industrial establishment'' as defined in clause (ii) of Section 2
of the Payment of the Wages Act, 1936.
At this juncture, it is useful to refer to the relevant provision of Section 2(e) of the Industrial Employment (Standing Orders) Act, 1946 and the
same is extracted hereunder:-
Section 2. Interpretation
....
(e) ""industrial establishment"" means
(i) an industrial establishment as defined in clause (ii) of Section 2 of the Payment of Wages Act, 1936 (4 of 1936)
Thus, what is defined in clause (2) of Section 2 of the Payment of Wages Act, 1936 is to be taken as the meaning for the term ""industrial
establishment"" as the definition under the Industrial Employment (Standing Orders), Act, 1946. In other words, it is to be construed that the
legislative intention for defining the term ""industrial establishment"" under the Payment of Wages Act, 1936 and the legislative intention for defining
the same term under the Industrial Employment (Standing Orders) Act, 1946 was one and the same. If there was different intention, it would have
been spelt out in the provisions itself.
Thus, when we see the definition of ""industrial establishment"" under the Payment of Wages Act, 1936, it has a sub-clause (h) u/s 2 which
contemplates any other establishment or class of establishments which the Central Government or a State Government may specify by notifications.
Thus, the contention of the learned Senior Counsel for the appellant is that the introduction of sub-section (h) in the year 1982 cannot be made
applicable and to include to the definition of ''industrial establishment'' as required under Standing Orders Act merits no consideration.
The learned single Judge has found that the appellant Society is a commercial establishment within the meaning of Section 2(3) of the Tamil
Nadu Shops and Establishments Act 1947 and once the appellant is an industrial establishment under the Payment of Wages Act, then
automatically Section 2(e)(1) of the Standing Orders Act will get attracted.
An identical issue was raised before the Delhi High Court in a decision rendered in the case of Indian Airlines Vs. Union of India (UOI) and
Others, . The Division Bench of the Delhi High Court has observed at paragraphs 16, 17 and 19 as follows:-
The submission of the petitioner is that this extended definition of the expression ""industrial establishment"" in the Payment of Wages Act, 1936
as amended in 1965 will not apply to the Standing Orders Act. It is submitted that when Section 2(e) of the Standing Orders Act refers to the
definition or expression ""industrial establishment"" as defined in Section 2(ii) of the Payment of Wages Act, 1936, it refers to the definition existing in
the Payment of Wages Act, 1936 on the date Standing Orders Act was enacted, i.e. 23rd April, 1946 and any subsequent amendment in Section
2(ii) of the Payment of Wages Act, 1936 do not get incorporated in the Standing Orders Act.
The answer to the question will depends on whether Section 2(ii) of the Payment of Wages Act, 1936 was incorporated into Section 2(e) of
the Standing Orders Act so as to become part and parcel of the Standing Orders Act on its enactment or is it a case of ""legislation by reference"". If
it is a case of ""legislation by incorporation"" subsequent amendments in Section 2(ii) of the Payment of Wages Act, 1936 on their own force cannot
be read into Section 2(e) of the Standing Orders Act. This is because in cases of legislation by incorporation, only the existing provision on the day
of enactment of the subsequent statute stands incorporated and not the future repeals, amendments or modifications made in the earlier law.
However, in cases of ""legislation by reference"", future modification or amendments in the earlier law are also applicable and read into the
subsequent legislation. In cases of ""legislation by reference"", repeal or amendment of the first statute has effect on the second/subsequent statute. In
this regard it may be appropriate to refer to the judgment of the Supreme Court in the case of Nagpur Improvement Trust v. Vasantrao and
Ors....
......
......
To our mind the present case is one of ""legislation by reference"" and not ""incorporation"". Section 2(e)(i) of the Standing Orders Act states that
the expression ""industrial establishment"" means industrial establishment as defined in the Payment of Wages Act, 1936. The Standing Orders Act
was enacted for defining conditions of recruitment, discharge, disciplinary action, holidays, leaves, etc., to minimize friction and disputes between
management and workers. Keeping in view the object and purpose behind the enactment of the Standing Orders Act it is legitimate to hold that it
is a case of legislation by reference and not in corporation. Industrial peace and reasonable and equitable service conditions balancing interest of
both workers and management ensures growth and progress of any industry. The Standing Order Act is also welfare and a beneficial legislation.
With this background it will be correct to state that the legislative intent was to refer to Section 2(ii) of the Payment of Wages Act, 1936 rather
than incorporating similar provision in full. In 1946 India was industrially backward and most of the industries including ""air transport services"" was
still in infinitesimal stage. It was natural that with growth, progress and development of industry the expression ""industrial enterprise"" shall undergo
expansion and more and more industries would be included. Therefore, it will be appropriate to hold that Section 2(ii) of the Payment of Wages
Act, 1936 has been frictionally made part of the Standing Order Act and not bodily transposed and written into as part and parcel of the latter
Act. Thus, subsequent amendments and changes in Section 2(ii) of the Payment of Wages Act, 1936 after enactment of the Standing Order Act
would apply and cannot be ignored.
The Delhi High Court has considered the issue in detail by relying on various decisions of the Apex Court and came to the conclusion that
subsequent amendments and changes in Section 2(ii) of the Payment of Wages Act, 1936 after enactment of the Standing Orders Act would apply
and cannot be ignored.
The Delhi High Court has observed that it is only a legislation by reference and not incorporation. We are in full agreement with the decision of
the Division Bench of the Delhi High Court. The decision of the Gujarat High Court relied on by the learned Senior Counsel reported in Valsad
Jilla Sahakari Bank Ltd. Vs. D.K. Patel and Others, came to be made by applying the principles of incorporation. Since we would like to follow
the decision of the Delhi High Court to hold that it is a legislation by reference, we are unable to follow the decision of the Gujarat High Court, with
due respect to the learned Judges.
The learned Judge also found that the provisions of the Standing Orders Act will prevail as it is a special law and therefore the appellant is not
justified in contending that there is no necessity to frame any certified standing orders for the establishment. The learned Judge further observed that
if the Standing Orders Act apply to an establishment and if an employee do not get a certified standing order, then by virtue of Section 12A of the
Standing Orders Act, the model standing orders framed by the State Government will apply to the employees of the appellant society.
After observing so, the learned Judge also considered the purpose of framing Standing Orders and by relying on the decision of the Apex
Court reported in Western India Match Company Ltd. Vs. Workmen, , the learned Judge found that the workman can have a say and the
Certifying Officer under Act is mandated to see its reasonableness before granting the certification. The learned Judge also relied on another
decision of the Apex Court reported in Co-operative Central Bank Ltd. and Others Vs. Additional Industrial Tribunal and Others, wherein the
Apex Court has held that the bye-laws framed by a society is only in the nature of contract and that cannot curtail the adjudicating authorities to
modify those terms. The above findings of the learned Judge based on the various decisions of the Apex Court, in our considered view, do not
warrant any interference in this writ appeal.
The learned counsel appearing for the fourth respondent relied on the decision of the Division Bench of this Court reported in The Tamil Nadu
Water Supply and Drainage Board and Another Vs. M.D. Vijayakumar and others, wherein it is held that the Standing Orders will prevail over the
regulations framed under the Tamil Nadu Water Supply and Drainage Board Act. It is also noted by the learned single Judge in this case that the
above decision of the Division Bench of this Court was upheld by the Apex Court.
Another decision reported in Life Insurance Corporation of India Vs. D.J. Bahadur and Others, of the Apex Court was cited for the purpose
that an Act may be general and for certain other purposes it may be special and while determining whether a statute is a general or special one, the
focus must be on the principle subject matter.
The decision of the Supreme Court reported in The State of Madhya Pradesh Vs. M.V. Narasimhan, was cited for the purpose that to
contend that where two enactments are supplemental to each other or where the amendment if not imported would render the subsequent Act
unworkable or ineffectual, then the subsequent amendments to the former legislation will have to be imported into the latter legislation.
For the very same purpose, Western Coalfields Limited Vs. Special Area Development Authority, Korba and Another, was also cited. The
Division Bench decision of this Court reported in 2010 Writ L.R. 199 (George Town Co-operative Vs. Deputy Commissioner of Labour) was
cited to contend that the employees Co-operative Societies are covered under the Tamil Nadu Shops and Establishments. Considering all these
facts and circumstances, we are of the view that no ground is made to interfere with the order of the learned single Judge. Accordingly, the writ
appeal is dismissed. Consequently, the connected M.P. is closed. No costs.