A INDIAN EXPRESS NEWSPAPERS (P) LTD. ETC. ETC.

B

v.

UNION OF INDIA AND ORS. ETC. ETC.

SEPTEMBER 23, 1994

[KULDIP SINGH, P.B. SAWANT AND N.P. SINGH, JJ.]

Working Journalists [Conditions of Service] and Miscellaneous

Provisions Act 1955, ss. 2(d), 8, JO and 13B-Constitution of India, Articles

14, 19(l)(a) and (g)--Bachawat Wage Board award-{fnits of newspaper es-

C tablishments having gross revenue above Rs. 2 crores considered in the class

of main establishment for purposes of wage fu:ation-Other units having gross

revenue less than two crores considered belonging to classes two grades

above-Held, the classification was discriminatory; the limitation of upgrada­

tion by two classes will apply to the fonner units also

D Working Journalists [Conditions of Service] and Miscellaneous

Provisions Act 1955, ss.2( d), 8, JO and 13B-conslitution of India, Articles

14, 19(1)(a) and (g)--Bachawat Wage Board award-Classification of

newspaper establishments on all-India basis and clubbing of units for fu:ation

of wages-Definition of 'newspqper establishment' amended retrospective-

E ly-Held, classification not violative of Articles 14, 19(1)(a) and (g).

Accepting the recommendations of the Wage Board constitnted

under the chairmanship of Shri Bachawat in its award dated May 26, 1989

('Bachawat Award'), the Central Government issued two orders ('orders')

both dated Augnst

31, 1989 under

S.11 of the Working Jonrnalists [Con-

F ditions of Service I and Miscellaneons Provisions Act 1955 ('Act') fixing

wage scales, grades, Honse 'R.nt and City Compensatory allowance for

newspaper employees.

By an amendment to the Act retrospective from

August

28, 1989, a 'newspaper establishment' under S.2(d) inclnded its

different departments, centres

and branches and even its printing press.

G An explanation added to

S.10(4) enabled the wage board constituted nnder

the Act to make recommendations for fixation of wages on an all-India

basis.

The petitioner newspaper establishments challenged the

two orders

and the

amendments to the A~t on the gronnd that in view of the decision

H in Express Newspapet (Pvt.) Ltd. andAnr. v. Union of India and Ors., [1959]

18

..

·'

INDIAN EXPRESS v. U.0.1. 19

SCR 12 which recognised the industry's capacity to pay on an industry· A

cum· region basis as an important circumstance in thefixation of wages,

the orders

and the amendments which overlooked the economic viability

and capacity of individual weaker units of a newspaper establishment

would

be violative of Articles 19(1)(a) and (g) of the

Constitution. Further

B

the classification by the Bachawat Award of those units earning gross

revenue of not less Rs. 2 crores along with the

main establishment while

placing other units earning a gross revenue of less

than Rs. 2 crores in

classes only two grades above was discriminatory. The Bachawat Award

also ignored the actual advertisement revenue

as a percentage of gross

revenue earned

by the establishment and made no provision for even a

reasonable depreciation. The retrospectivity of the recommendations

ef· C

fective from January 1, 1988. conpled with the increased costs of newsprint

imposed

an unreasonable burden.

Partly allowing the petitions, this

Court

HELD : 1. While applying the principle of fixation of wages on all D

India basis the Board has made a discrimination between newspaper

establishments belonging to classes

IA to

V (earning gross revenue of not

less than Rs. 2 crores)

and those belonging to classes VI to IX (earning

gross

revenue less than R•. 2 crores). There is no satisfactory explanation

to defend the said discrimination. The award will have to be modified

by E

extending the limitation of upgradation upto the maximum of two classes

to all classes of newspaper establishments. [31-H,

32-A·B]

2.1. The classification of the newspaper establishments on all India

basis for the purpose of fixation of wage is not violative of the petitioner's

fundamental rights under Articles 19(1)(a)

and (g). The units of an

estab·

lishement which bas branches all over India can be clubbed together for the

purpose offixation of wages. After the amendment of S.2( d) retrospectively

read with the addition of the Explanation to S.10( 4), the old provisions can

no longer

be pressed into service to contend against the grouping of the

units of the all India establishments, into one class.

[32·D·E·G)

Express Newspaper (Pvt.) Ltd. and Anr. v. Union of India and Oi:s.,

[1959) SCR 12, followed.

2.2. Financial capacity of an all India newspaper establishment has

F

G

to be considered on the basis of the gross revenue and the financial H

20 SUPREME COURT REPORTS [1994] SUPP. 4 S.C.R.

A capacity of all the units taken together. Hence it cannot be said that the

petitioner companies are not

viable whatever the financial capacity of their

individual units.

[32-F)

B

CIVIL

ORIGINAL/APPELLATE JURISDICTION: Transfer Case

(C) No. 10 of 1990 etc. etc.

From the Judgment and Order dated 17.1.90 of the Bombay High

Court in W.P. No. 82 of 1990.

V.R. Reddy, Additional Solicitor General, V.C. Mahajan, F.S.

C Nariman, Arun Jaitley, V.A. Bobde, Ms. Indira Jaisingh, B. Datta, G.

Ramaswamy, Madan

G.

Phadnis, R.N. Trivedi, Gaurab Banerji, R. Karan­

jawala, P.K. Mullick, Ms. M. Karanjawala, Ms. Suruchi Aggarwal, D.A.

Dave, Vivek Sharma, Ms. Ruby Ahuja, K.J. Johan,

AR. Atrey, S.

Sukumaran for J.B.D. & Co.,

Pramod B. Agarwala, M.N. Shroff, Ms.

Reema Bhandari, Ms. Aparna Bhatt,

Ms. Shashi Kiran, Ms. Anil Katiyar,

D Ms. Niranjana Singh, V.G.

Pragasam P.R. Seetharaman, K.V. Vijay Kumar,

Jitendra Sharma, B.K. Pal, P. Gaur, Ms. Gunwant Dara, Ms. V.D. Khanna,

Mukul Mudgal, Ms. Vijaya Lakshmi Menon, Sudhir Kumar Gupta, Sarva

Mitter, for Mitter & Mitter Co., Jagdish Prasad Goyal, Ms. Bina Gupta,

S.K. Jain, Madan Lokur, Surya Kant, Ms. Urmila Sirur, R.P. Kapur, AL.

E Trehan, Om Prakash Khaitan, Satyapal Kaushal Chand Pas~ A.G. Ratna

Parkhi, Ms. R. Vaigai, Ms. C. Ramamurthy, P.K. Chakraborthy, Suman

Khaitan, for O.P. Khaitan & Co., Raju Rama Chandran, Anis Suhrawardy,

C.N. Sree Kumar, in-person in T.P. No. 5 & 10/90 B.K. Pal, B.M.

Srivastava,

Ms. Arvinder Choudhary, Ms. Minakshi Gautam for Mitter &

Mitter Co., Rakesh Baijpai for the appearing parties.

F

The Judgment of the Court was delivered by

SAWANT, J. In all these matters, the petitioner-establishments have

challenged two orders

viz., Nos.683(E) and 684(E), both dated 31.8.1989,

G (hereinafter referred to as 'Orders') issued by the Central Government

under

Section 11 of the Working Journalists and Other Newspaper

Employees (Conditions of Service) and Miscellaneous Provisions Act, 1955

(hereinafter referred to as the 'Act') accepting and

giving effect to the

recommendations of the Wage Board Report dated

26.5.1989 (hereinafter

referred to as the 'Report') on various grounds. Order No. 683(E) deals

H with wage-scales and grades, and Order No. 684(E) deals with House Rent

'·

·'

INDIANEXPRESSv. U.O.l.[SAWANT,J.] 21

Allowance and City Compensatory Allowance. The Wage Board was con- A

stituted by the respondent 1-Union Government in 1985 under the chair­

manship of Shri Bachawat and hence the Report given by it is known as

Bachawat Award. Both the orders

are challenged on the ground of viola-

tion

of the fundamental rights under Articles

14, 19{1){a) and 19{1)(g) of

the Constitution of India.

The petitioners also challenge the amendment

of Sections 2( d) and

10{4) of the Act brought about by Sections 2{i) and 3 of the Working

Journalists

and

Other Newspaper Employees {Conditions of Service) and

Miscellaneous Provisions {Amendment) Act, 1989 {hereinafter referred to

B

as the "Amending Act") by adding an Explanation at the end of Section C

10{ 4) and a Schedule at the end of the Act as being violative of Articles

14, 19{1){a) and 19{1){g) of the Constitution.

·

2. In order to appreciate the challenges, it is necessary to state a few

background facts.

D.

The Act as it was initially enacted was titled the Working Journalists

(Conditions

of

Service) and Miscellanceous 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 on

21.12.1974, by the

Working Journalists

and other Newpaper Employees {Conditions of

Ser-E

vice) and Miscellaneous Provisions {Amendment) Act, 1974, the scope of

the original

Act was expanded to include 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 F

of the Act were challenged by some establishments including some of the

petitioners herein,

under Article 32 of

the· Constitution, and these challen-

ges were dealt with

in the decision of this Court in Express Newspaper (Pvt.)

Ltd. and Anr. v. Union of India and

Ors., [1959] SCR 12 by a Constitution

Bench

of five learned Judges. To this decision, we may have occasion to G

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 by all industrial adjudicators in the

country.

After the Divatia Wage

Board, three more wage boards were ap-· H

22 SUPREME COURT REPORTS [1994] SUPP. 4S.C.R.

A pointed, viz., Bhandarkar Wage Board, Sinde Wage Board and Palekar

Wage Board in 1958, 1963 and 1975-76 respectively. 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 award.

B 3. Before we discuss the challenges to the impugned award, it will be

necessary to examine the relevnat provisions of the Act, the changes

brought about in the Act after the decision in

Express Newspaper case

(supra) and the propositions of law laid down in the aforesaid decision.

C

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

D syndicate; (and includes newspaper establishments specified

as one establishment under the

Schedule).

E

F

G

H

Explanation -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

establishemnt 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;

JNDIANEXPRESSv. U.0.1.(SAWANT,.T.] 23

(3) two or more newspaper establishemnts publishing A

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 establishment.

2. 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;

B

c

(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

D

holding company or a substantial number of their equity

shares are owned

~y 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 E

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

therin were inserted

by the Amending Act 31 of 1989 which came into force

retrospectively on 28th August,

1989. The provisions of

Section 2(i) of the

F

G

said Amending Act in terms state that the said bracketed protion "shall be

deemed elways to have been inserted at the end" of the original Section H

24 SUPREME COURT REPORTS (1994) SUPP. 4 S.C.R.

A 2(d) of the Act. Section 8 and Section 13-B give power to the Central

Government to fix rates of wages in respect of working journalists and non­

journalist .newspaper 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 Section 13-C lay down the procedure for fixing or revising the rates

B

of wages in respect of working journalists and non-journalist newspaper

employees respectively, and they state that for the purpose, the Central

Government shall as and when necessry, constitute a Wage Board. Sub­

section ( 1) of Section 10 read with Section 13-D lays 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

C 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. Sub-section (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

D reasonable, having regard to the capacity of the employer to pay the same

or to any other circumstance, whichever may deem relevant to the person

making the representation. Sub-section (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

E

F

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. Sub-section ( 4) thereof makes an

important provision. It enjoins upon the Board while making the recom­

mendations to the Central Government, to have regard to the cost of living,

the prevalent rates of wages for comparable employment, the circumstan-

ces 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 sub-section ( 4) by the same Amending

Act of 1989 which has a bearing on one of the challenges made to the

impugned Award. It states :

G "Explanation. -For the removal of doubts, it is hereby declared

that

nothing .in this sub-section shall prevent the Board from

making recommendations for fixation or revision of rates of wages

on all India

basis".

H [Emphasis supplied)

INDIAN EXPRESS v. U.0.1. [SAWANT, J.] 25

Sub-section (1) of Section 12 gives power to the Central Government to A

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. Sub-section (2) thereof gives

power to the Central Government to make such modifications in the B

recommendations, not being modifications of the nature referred to in

sub-section (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.

Sub­

section (3) states that every order make by the Central Government

together with the recommendations of the Board shall come into operation

C

on the date of publication or on such date, whether prospective or

retrospective,

as may be specified in the order. Section 13 read with Section

13-D states that on the coming into operation of the order of the Central

Government under Section

12, every working journalist and non-journalist

newspaper employee shall be entitled to be paid by his employer

wages at D

the rate which shall in no case be less than the rates of wages specified in

the order. Section 13-A

gives power to the Central Government to fix

interim rates of wages after consulting the Wage Board.

4. We may now refer to the propositions of law laid down by this

Court in the decision in

Express Newspapers Ltd. case (supra). They are, E

among others,

as follows

-

'

(1) For the fixation of rates of wages which include within its com-

pass, 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

mini-F

mum 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,

as an essential

circumstance.

G

(2) The capacity of the industry to pay is to be considered on an

industry-cum-region basis after taking a fair cross section of the

·

industry.

(3) The proper measure of weighing the capacity of the industry to H

26

A

B

c

D

E

F

G

H

SUPREME COURT REPORTS [1994] SUPP. 4 S.C.R.

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

di(ficulty 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

newspaper industry in the 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 classifica­

tion 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 per­

son 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

.. -

INDIANEXPRESSv. U.O.l. [SAWANT,J.J 27

arriving at its decision in regard to the wage structure though the A

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 newspaper 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. A

·cross

section of 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 bear.

B

c

5. 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, D

the non-journalists newspaper 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 defini-

tion and

th~ Schedule. With this amendment, different departments,

branches and centres of a newspaper establishment we·e 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

E

F

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 G

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 on all

India basis. It has to be noted that this amendment was made after the

publication of the award impugned in the present case.

H

A

B

c

28 SUPREME COURT REPORTS [1994) SUPP. 4 S.C.R.

6. The main contention of the petitioners in the present cases/peti-

tions

is that this Court in Express Newspaper case (supra) has accepted the

contention that in the absence of the requirement of looking into the

capacity of industry on an industry-region basis, the entire Act would be

violative of Constitution. Hence the Court had in that case read into the

provisions of

Section 10{4) [the then Section 9 {1)) the requirement of

looking into the capacity of the industry to pay on an industry-cum-region

basis. The necessity to read the said requirement into Section 10 ( 4) has

not been

changed by the amendments to

Sections 2( d) and 10( 4). If it is

held that the amendment to Section 2( d) would permit an all India fixation

of wages, talcing into consideration the gross revenue of the company or

other independent companies which are sought to be clubbed, the

provisions

of

Section 2( d), as amended, would be violative of the

petitioners' right under Articles 19{1)(a) and (19)(1)(g) of the Constitution

inasmuch as such fixing up of wages would bring about the situation as it

prevailed under the first Wage Board resulting in ignoring the economic

D viability of the weaker units of the company rendering it impossible to run

the said units.

It would also make it impossible for the companies to start

new newspape:s since they would not be viable and would not be in a

position to complete with other publications in the same locality. The

grouping of the newspapers into chain or multiple units

<lid not imply that

E

F

the weaker units in those groups must be treated on par with the stronger

units. Any such principle

of fixation of wages without taking into

considera­

tion the burden that would be imposed upon weaker unit of a particular

newspaper establishment would be erroneous. Hence it

is contended that

the amendment to

Section 2( d) would be subject to the provisions of

Section 10( 4) as it stood and as it stands today. Section 2( d) is only a

definition clause and the provisions of Section 10( 4) are mandatory. Hence,

harmonious construction

of the provisions of

Section 2{ d) and Section

10{4) is necessary. Construed thus, it would enable the Wage Board to fix

the wages on all India basis taking into consideration the industry as a

whole and at the same time, the capacity

of individual unit. That would

G enable the Wage Board to classify the individual unit first into its proper

class and then upgrade it neasonably

if it belongs to a multiple or chain

group. In

this connection, it is pointed out that all the Wage Boards in the

past except the Palekar Wage Board which dealt with the question on a

different footing,

fJXed wages on the above basis. The said Wage Boards

H thus implemented the aforesaid decision of this Court.

•

•

J

•

INDIANEXPRESSv. U.0.1. [SAWANT,J.] 29

It is further pointed out that the present Wage Board itself has A

recognised this principle and while classifying the newspaper estab­

lishments in para

11 of

Section II of Part I of Chapter IX of the Report

on the basis of the gross revenue into 10 classes, it has made an exception

in paragraph 6(2) of the said Section in case of newspaper establishments

falling in classes VI to IX by directing that they

will not be stepped up by B

more than two classes as a whole in clubbing of gross revenue as is directed

in sub-para (1) of the said para

6. However, the Board has given no reason

why similarly for the establishments falling in classes IA to

V, the same

consideration should not

be shown.

On the other hand, the Board without

giving any reasons, has chosen to treat every unit of

the newspaper estab- C

lishment falling in the latter classes, viz., classes IA to

V as being of the

same class to which the establishment itself belongs on the basis of its gross

revenue. This has manifastly 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 un­

bearable financial burden and forcing them to close. Such classification D

directly offends the petitioners' rights under Articles 19(1)(a) and 19(1)(g)

of the Constitution.

Among the other infirmities whicr are pointed out in the im­

pugned award, the first is that while classifying the establishments, the E

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 concerned

establishments would have been placed in the class next below that in

.vhich F

they are classified on the basis of their gross revenue. Secondly, the award

while calculating the fmancial 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 retrospecitve effect it has given to its recommen­

dations from 1.1.1988. The burden

on the establishments from 1.1.1988 to G

31.12.1989 is enormous and the Board was duty-bound to 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 news-print which had in the meanwhile gone up by about 76.6 . . per cent. H

30 SUPREME COURT REPORTS [1994] SUPP. 4 S.C.R.

A We find much substance in the contention -that the Board has

B

c

D

E

F

arbitrarily clubbed together the different units of the same establishment

and classified all of them with the highest of the class to which its !op-most

unit belongs

so far as classes IA to

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 differnt newspaper establishemnts on the basis of

their gross revenue as follows :

Class Gross Revenue

IA Rs. 100 crores and above

I Rs.

50 crores and above but less than Rs.

100 crores

II Rs.

20 crores and above but less than Rs. 50 crores

III Rs.

10 crores and above but less than Rs. 20 crores

IV Rs. 5 crcores and above but less than Rs. 10 crores

V Rs. 2 crores and above but less than Rs. 5 crores

VI Rs. 1 crores and above but less than Rs. 2 crores

Vil Rs. 50 lakhs and above but less than Rs. 1 crore

VIII Rs.

25 lakhs and above but less than Rs. 50 lakhs IX Less than Rs. 25 lakhs

In Annexure V of the Report, the Board has catalogued the effect

of clubbing the different units of the same establishemnt at different places

on the basis of average gross revenue for the past

3 years. The Annexure

itself depicts the inequitable results of the grouping. We

may as an illustra-

G tion refer to the effect of clubbing of the units of some of the petitioner­

establishments which are mentioned there. Taking the case of Bennett

Coleman

& Co. Ltd., it has its units at Bombay, Delhi, Ahmedabad,

Calcutta,

Patna, Jaipur, Pune, Madras and also printing presses at Madras,

Patna, Jaipur and Lucknow and its total gross revenue is Rs. 10,238.72

H crores. Its Bombay, Delhi and Ahmedabad units have been classified as

• I

I

J

INDIAN EXPRESS v. u.o.r. [SA WANT, J.] 31

IA, although their gross revenue is less Rs. 100 crores, 50 crores and 5 A

crores respectively and they would properly fall according to the guidelines

of .the Board in classes I, II and V respectively. Similarly, the units of the

company at Calcutta, Patna, Bangalore and Jaipur are classified in

categories IV,

V,

V and V respectively, although on the basis of their gross

revenue they would fall in the categories of

VI, VII, VII and IX respec- B

. lively, Corning now to the second establishment, viz., Express Newspapers,

they have their

two units at Bombay, one at Madurai and another at

Hyderabad. The gross revenue of all the units

was Rs. 7,918.18 crores. They

are all consigned to class

I, although their main unit at Bombay and their

unit at Madurai belong to class II and their subsidiary unit at Bombay and

C

their unit at Hyderabad belong to cl.ass IV and

V respectively. It is not

necessary to multiply these instances. According to

us, in view of the

definition of

"newspaper establishment" in Section 2( d) and the Explana-

tion 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 Newspaper case

(supra) as extracted above, the units of an establishment which has

D

branches all over India, can be clubbed together for the purpose of

fixation

of wages on all India basis. Since all the units of an establishment 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 E

result of the clubbing of the different units of the same establishment.

However, there

is much force in the contention of the petitioners that

the principle

of

fixation of the wages on all India basis has not been applied

by the Board with uniform yardstick as is evident from paragraph 6(2) of F

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 classes

I.A to

V are all to be classified as belonging

to the class to which the said establishment belongs on the basis of the

G

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 H

32 SUPREME COURT REPORTS [1994] SUPP. 4 S.C.R.

A properly belong. On the other hand, the units of the establishments belong­

ing to classes IA to 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 on

all India basis, it has made the discrimination in

B question between the newspaper establishments belonging to classes IA to

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 upto the maximum of two classes

C laid down in the said para 6(2} also to the newspaper establishments falling

in classes IA to

V.

7. 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

D 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

E Newspaper case (supra}, the classification of the newspaper establishments

on all India basis 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 an all India

newspaper establishment has to be considered on the basis of the gross

F

revenue and the financial capacity of all the units taken together. Hence,

it cannot be said that the petitioner-companies as all India newspaper

establishments are not viable whatever the financial incapacity of their

individual units. After amendment 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

G of the all India establishments, into one class.

8. The other contentions advanced on behalf of the Indian Express

Newspapers

(P) Ltd. are as follows. Firstly, it is contended that the benefit

of the provisions of paragraph

12 of Section II of Part I of Chapter IX is

H not given to the petitioner-establishment while classifying it. Secondly,

.I

INDIAN EXPRESS v, U.OJ. [SAW ANT, J.] 33

while calculating the financial capacity, the award has made no provision A

even for a reasonable depreciation and to that extent the estimates of the

capacity of the establishment to pay the revised wages are seriously flawed .

The third contention is that the Board has not considered the burden of

retrospective effect it has given to its recommendations from Ll.1988.

Lastly, it is contended that the award has not taken into consideration the B

cost of newsprint which had in the meanwhile gone up by about 76.6 per

cent

9. More or less similar contentions were raised on behalf of other

petitioner-establishments. We have made clear at the very outset that some

of these contentions raised disputed questions of facts and others, mixed

C

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 any 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 D

boycotted the proceedings of the Board.

10. In view of what we have held above, we allow all the Writ

Petitions and Transfer Cases except T.C.N. 6 of 1990, only to the extent

indicated below.

The benefit given in paragraph 6(2) of Section II of Part I of Chapter

IX will extend to all classes of the newspaper establishments

as categorised

in paragraph

11 of the said Report and the units of the newspaper

estab­

lishments in all the said classes shall not be stepped up by more than two

classes over and above the clusses to which they belong according to their

own gross revenue.

E

F

In view of our above conclusion, the award as modified, should be

implemented by all the

establishments·w.e.f. Ll.1988 and the respondent­

employees should be paid wages w.e.f. the said date i.e., Ll.1988. Where,

however, there have been settlements between the management and the

G

employees the payment of wages and of arrears of wages will be governed

by the terms of those settlements.

There will be no order

as to

costs.

In views of the above order by which T.C. No. 5 of 1990 is allowed H

34 SUPREME COURT REPORTS (1994) SU}'P. 4 S.C.R.

A as above, SLP (C) NO. 16356 of 1990 filed by the same petitioners in this

Court, does not survive.

In view of the order passed above in main matters, T.C. No. 6 of 1990

stands disposed of, as above.

B In view of our order in the main matters, as above, none of the

Interlocutory Applications survives,

S.M. Petitions allowed.