14 Oct, 1954
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The Edward Mills Co. Ltd., Beawar, And Others Vs. The State Of Ajmer And Another.

  Supreme Court Of India 1955 AIR 25 1955 SCR (1) 735
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PETITIONER:

THE EDWARD MILLS CO. LTD., BEAWAR, AND OTHERS

Vs.

RESPONDENT:

THE STATE OF AJMER AND ANOTHER.

DATE OF JUDGMENT:

14/10/1954

BENCH:

MUKHERJEA, B.K.

BENCH:

MUKHERJEA, B.K.

AIYYAR, T.L. VENKATARAMA

MAHAJAN, MEHAR CHAND (CJ)

BOSE, VIVIAN

JAGANNADHADAS, B.

CITATION:

1955 AIR 25 1955 SCR (1) 735

CITATOR INFO :

R 1960 SC 424 (10)

RF 1961 SC 4 (5,25)

RF 1961 SC 298 (12)

F 1962 SC 12 (11)

RF 1962 SC 97 (6)

R 1964 SC 648 (17,4)

R 1964 SC 980 (8)

R 1964 SC1260 (6)

RF 1966 SC1788 (38)

RF 1967 SC 669 (29)

RF 1967 SC 691 (66)

R 1970 SC2042 (10)

R 1974 SC1044 (6)

E 1980 SC 350 (5)

RF 1982 SC 149 (803)

D 1986 SC 872 (110)

R 1990 SC 560 (13)

ACT:

Constitution of India, Art. 372-Words "law in force"-

Meaning of- Whether include regulation or order having the

force of law --An order made under s. 94(3) of the

Government of India Act, 1935 -Whether "law in force" and

capable of adaptation-Minimum Wages Act, 1948 (Act XI of

1948), s. 27-"Appropriate Government" -Given power to add to

either part of schedule-Any employment in respect of which

minimum rates of wages should be fixed-Whether such power

warranted and not unconstitutional and within the limits of

permissible delegation-Advisory committee-Appointment of-

Under s. 5 of the Act-Extension of its term beyond the

period already expired-Validity-Proceduraral irregularities-

Wlhether vitiate the final report.

736

HEADNOTE:

The words 'law in force' as used in Art. 372 of the Consti-

tution are wide enough to include not merely a legislative

enactment but also any regulation or order which has the

force of law.

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An order made by the Governor-General under s. 94(3) of

the Government of India Act, 1935, investing the Chief

Commissioner with the authority to administer a province is

really in the nature of a legislative provision which

defines the rights and powers of the Chief Commissioner in

respect of that province. Such an order comes within the

purview of Art. 372 of the Constitution and being a 'law in

force' immediately before the commencement of the

Constitution would continue to be inforce under clause (1)

of the article. Such an order is capa ble of adaptation to

bring it in accord with the constitutional provisions and

this is precisely what has been done by the Adaptation of

Laws Order, 1950. Therefore an order made under s. 94(3) of

the Government of India Act, 1935, should be reckoned now as

an order made under Art. 239 of the Constitution and it was

within the competence of the President under clause (2) of

Art. 372 to make the adaptation order.

Under s. 27 of the Minimum Wages Act, 1948, power has

been given to the "appropriate Government" to add to either

part of the schedule any employment in respect of which it

is of opinion that minimum wages shall be fixed by giving

notification in a particular manner, and thereupon the

scheme shall, in its application to the State, be deemed to

be amended accordingly. There is an element of delegation

implied in the provisions of s. 27 of the Act, for the

Legislature, in a sense, authorises another body specified

by it, to do something which it might do itself. But such

delegation, if it can be so called at all, is not

unwarranted and unconstitutional and it does not exceed the

limits of permissible delegation.

The legislative policy is apparent on the face of the

present enactment. What it aims at is the statutory

fixation of minimum wages with a view to obviate the chances

of exploitation of labour. It is to carry out effectively

the purposes of the enactment that power has been given to

the appropriate Government to decide with reference to local

conditions whether it is desirable that minimum wages should

be fixed in regard to a particular trade or industry which

is not already included in the list.

Therefore in enacting s. 27 the legislature has not

stripped itself of its essential powers or assigned to the

administrative authority anything but an accessory or

subordinate power which was deemed necessary to carry out

the purpose and the policy of the Act.

Rule 3 of the rules framed under s. 30 of the Act

empowers the State Government to fix the term of the

committee appointed under s. 5 of the Act and to extend it

from time to time as circumstances require.

The period originally fixed had expired and its term was

extended subsequently. It did not function and submitted no

737

report during the period. Assuming that the subsequent

order could not revive a committee which was already dead, a

new committee could be held to have been constituted and the

report, submitted by it would be a perfectly good report.

Apart from this, a committee is only an advisory body and

procedural irregularities of this character could not

vitiate the final report which fixed the minimum wages.

Baxter v. Ah Way (8 C.L.R. 626) and Reg. v. Burah (3

App. Cas. 889) referred to.

JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 138 and 139

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of 1954.

Appeals under articles 132 and 133 of the Constitution

of India from the Judgment and Order, dated the 16th

February, 1953, of the Court of Judicial Commissioner,

Ajmer, in Civil Miscellaneous Petitions Nos. 260 and 263 of

1952.

N.C. Chatterjee (B. D. Sharma and Naunit Lal, with him)

for appellants Nos. 1 and 2 in C. A. No. 138 of 1954 (Edward

Mills and Krishna Mills).

Achhru Ram (B. D. Sharma and Naunit Lal, with him) for

appellant No. 3 in C. A. No. 138 of 1954 (Mahalaxmi Mills).

H.N. Seervai, J. B. Dadachanji and Rajinder Narain for

the appellant in C. A. No. 139 of 1954.

C. K. Daphtary, Solicitor-General of India (M. M.

Kaul and P. G. Gokhale, with him) for respondent No. 2

(Union of India).

1954. October 14. The Judgment of the Court was delivered

by

MUKHERJEA J.-These two appeals are directed against a

common judgment, dated the 16th of February, 1953, passed by

the Judicial Commissioner of Ajmer, on two analogous

petitions under article 226 of the Constitution, in one of

which the appellants in Appeal No. 138 of 1954 were the

petitioners, while the other was filed by the appellant in

Appeal No. 139 of 1954.

The petitioners in both the cases prayed for a

declaration that the notification, dated the 7th of October,

1952, issued by the State Government of

738

Ajmer, fixing the minimum rates of wages in respect of

employment in the textile industry within that State, under

the provisions of the Minimum Wages Act (Act XI of 1948),

was illegal and ultra vires and for issue of writs in the

nature of mandamus directing the respondents not to enforce

the same against the petitioners.

To appreciate the points that have been canvassed before

us, it will be convenient to narrate briefly the material

facts in chronological order. On the 15th of March, 1948,

the Central Legislature of India passed an Act called The

Minimum Wages Act, 1948, the object of which, as stated in

the preamble, is to provide for fixing minimum rates of

wages in certain employments. The schedule attached to the

Act specifies, under two parts, the employments in respect

of which the minimum wages of the employees can be fixed;

and section 27 authorises the "appropriate Government",

after giving three months' notice of its intention to do so,

to add to either part of the schedule, any other employment,

in respect of which it is of the opinion that minimum rates

of wages should be fixed under the Act. The expression

"appropriate Government" as defined in section 2(b) means,

in relation to a scheduled employment, other than one

carried by or under the authority of the Central Government,

the State Government' Under section 3 the "appropriate

Government" is to fix minimum wages payable to employees

employed in any employment specified in the schedule at the

commencement of the Act or added to it subseq uently in

accordance with the provisions of section 27. Sub-section

(1) (a) of this section provides inter alia that the

"appropriate Government" may refrain from fixing the minimum

rates of wages in respect of any scheduled employment in

which there are in the whole State less than 1,000 employees

engaged in such employment. Section 5 lays down the

procedure for fixing minimum wages. The appropriate

Government can appoint a committee to hold enquiries to

advise it in the matter of fixing minimum wages; in the

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alternative it can, by notification in the official public

gazette, publish its proposals for the information of

persons likely to be affected thereby. After

739

considering the advice of the committee or the

representations on the proposals as the case may be, the

'appropriate Government' shall fix the minimum rates of

wages in respect to any scheduled employment, by

notification in the official gazette, and such rates would

come into force on the expiry of three months from the date

of issue unless the notification directs otherwise. Section

9 provides inter alia that an advisory committee constituted

under section 5 shall consist of persons nominated by the

appropriate Government. There shall be in the committee an

equal number of representatives of the employers and the

employed in any scheduled employment and there shall be

independent persons as well, not exceeding one-third of the

total number, one of whom shall be appointed Chairman.

Section 30 confers on the appropriate Government the

power to make rules for carrying out the purposes of the

Act.

It may be mentioned at the outset that Part I of the

schedule to the Act mentioned only 12 items of employment at

the time when the Act was passed and employment in the

textile industry was not included in Chem. On the 16th of

March, 1949, the Central Government issued a notification,

in exercise of its powers under section 94(3) of the

Government of India Act, 1935, directing that the functions

of the "appropriate Government" tinder the Minimum Wages

Act, would, in respect of every Chief Commissioner's

Province, be exercised by the Chief Commissioner. On the

17th March, 1950, the Chief Commissioner of Ajmer, purport-

ing to act as the "appropriate Government" of the State,

published a notification in terms of section 27 of the Act

giving three months' notice of his intention to include

employment in the textile mills as an additional item in

Part I of the schedule. On the 10th of October, 1950, the

final notification was issued stating that the Chief

Commissioner had directed "that the employment in textile

industry" should be added in Part I of the schedule.

On the 23rd November, 1950, another notification was

published under the signature of the Secretary to

740

the Chief Commissioner containing the rules purporting to

have been framed by the Chief Commissioner in exercise of

his powers under section 30 of the Act. Out of these, only

rules 3, 8 and 9 are material for our present purpose. Rule

3 provides that the term of office of the members of an

advisory committee shall be such, as in the opinion of the

State Government, is necessary for completing the enquiry

into the scheduled employment concerned and the State

Government may, at the time of the constitution of the

committees, fix a term and may, from time to time, extend it

as circumstances may require. Rule 8 provides for filling

up the vacancies occurring or likely to occur in the member-

ship of the committee by resignation of any of its members.

Rule 9 lays down that if a member of the committee fails to

attend three consecutive meetings he would cease to be a

member thereof. The rule further states that such member

could, if he so desires, apply, within a certain time for

restoration of his membership and restoration could be made

if the majority of the members are satisfied that there were

adequate reasons for his failure to attend the meetings.

On the 17th January, 1952, a committee was appointed to

hold enquiries and advise the Chief Commissioner in regard

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to the fixation of minimum wages relating to the textile

industry within the State. Ten members were nominated

consisting of four represeiitatives of the employers, four

of the employees and two independent members, one of whom

Shri Annigeri was to act as an expert member of the

committee and the other, Dr. Bagchi, as its Chairman. The

term of office of the members was fixed at-six months from

the date of the notification ending on the 16th of July,

1952. The first meeting of the committee was held on the

29th February, 1952. The expert member was present at that

meeting and it was resolved that the minimum wages must not

merely provide for the bare subsistence of life but should

be adequate for the maintenance of the efficiency of the

worker. The second meeting was held on the 29th March,

1952, and the third on the 14th of June, 1952. The expert

member was not present at any other meeting except the first

and on the 27th of

741

May, 1952, he wrote a letter to the Chief Commissioner

stating that he was proceeding to Europe on the 3rdd June,

1952, for a period of three months. He expressed' his

willingness to assist the Chairman in the preparation of the

report after he came back from Europe by the first week of

September, next, provided the term of the committee was

extended. If however that was not possible, he requested

that his letter might be treated as a letter of resignation

from the membership of the Committee. No action appears to

have been taken on receipt of the letter. The fourth and

the fifth meetings of the committee were held respectively

on the 8th and the 15th of July, 1952. On the 20th August,

1952, the the Chairman of the Committee informed the Chief

Commissioner that Shri Annigeri had ceased to be a member of

the committee by reason of his failing to attend three

consecutive meetings. He had also desired that his letter

to the Chief Commissioner dated the 27th May, 1952, should

be treated as a letter of resignation. In the circumstances

the Chief Commissioner was requested to fill up this vacancy

in the membership. On the very next day, that is to say, on

the 21st August, 1952, a notification was issued by which

the Chief Commissioner ordered the extension of the term of

the committee up to the 20th of September, 1952, and on the

28th of August, following, another notification was made

appointing Shri Annigeri as a member of the committee. The

term of the committee was extended by a further notification

till the 5th of October, 1952. In the meantime a meeting of

the committee was held on the 10th September, 1952, in which

Shri Annigeri was not present. The only resolution passed

was, that all relevant papers might besent to Shri Annigeri

as desired by him. It appears that some time after the 14th

of September, 1952, the Chairman himself took the papers to

Nagpur where Shri Annigeri was staying and a draft final

report was prepared by the Chairman in consultation with the

expert member and both of them signed the report at Nagpur.

The report was placed before the other members on the 4th

October, 1952, and on the 7th of October, following, a

notification was issued fixing

95

742

minimum rates of wages for the employees in the textile

industry in the State of Ajmer, under the signature of the

Secretary to the Chief Commissioner and stating that these

rates should be deemed to be in force from the 1st of

September, 1952.

Feeling aggrieved by this notification the three

appellants in Appeal No. 138 of 1954 presented an

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application under article 226 of the Constitution before the

Judicial Commissioner of Ajmer on the 31st October, 1952,

praying for a writ in the nature of mandamus ordering the

State of Ajmer not to enforce the same. A similar

application was filed by the Bijay Cotton Mills, the

appellant in the other appeal, on the 6th of November, 1952.

Both the petitions were heard together and a common judgment

was passed by the Judicial Commissioner on the 16th of

February, 1953. The applications were dismissed except that

the Chief Commissioner was held to have exceeded his legal

authority in giving retrospective effect to the notification

of the 7th of October, 1952, and the State of Ajmer, was

restrained from enforcing the notification from any date

earlier than the 8th of January, 1953. It is against this

judgment that these two appeals have come up to this Court

on the strength of certificates granted by the Judicial

Commissioner, Ajmer.

Mr. Chatterjee, appearing for the appellants in Appeal

No. 138, has put forward a three-fold argument on behalf of

his clients. He has contended in the first place that

without a delegation of authority by the President under

article 239 of the Constitution, the Chief Commissioner of

Ajmer was not competent to function as the "appropriate

Government" for purposes of the Minimum Wages Act. All the

steps therefore that were taken by the Chief Commissioner

under the provisions of the Act including the issuing of the

final notification on the 7th of October, 1952, were illegal

and ultra vires.

The second contention raised is that the provision of

section 27 of the Act is illegal and ultra vires inasmuch as

it amounts to an illegal and unconstitutional delegation of

legislative powers by the Legislature in favour of the

"appropriate Government" as defined in the

743

Act. The third and the last contention is, that the Chief

Commissioner had no authority to extend retrospectively the

term of the Advisory Committee after it expired on the 16th

of July, 1952.

Mr. Seervai, who appeared in support of the other appeal,

adopted all these arguments on behalf of his client. He

however raised some additional points impeaching the

constitutional validity of the Minimum Wages Act itself on

the ground that its provisions conflicted with the

fundamental rights of the appellants and its employees

guaranteed under article 19(1) (g) of the Constitution.

These points were argued elaborately by the learned counsel

in connection with the two petitions filed on behalf of the

Bijay Cotton Mills Ltd., and a number of employees under

them under article 32 of the Constitution and we will take

them up for consideration when dealing with these petitions.

We will now proceed to consider the three points mentioned

above which have been raised in support of the appeals.

So far as the first ground is concerned the argument of Mr.

Chatterjee in substance is that the expression "appropriate

Government" has been defined in section 2(b) (ii) of the

Minimum Wages Act to mean, in relation to any scheduled

employment, not carried on by or under the authority of the

Central Government, the State Government. "State

Government" has been defined in section 3(60) of the General

Clauses Act as meaning, in regard to anything done or to be

done after the commencement of the Constitution in a Part C

State, the Central Government. Prior to the commencement of

the Constitution, under section 94(3) of the Government of

India Act, 1935, a chief commissioner's Province could be

administered by the GovernorGeneral acting to such extent,

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as he thought fit, through a Chief Commissioner to be

appointed by him in his discretion; and under section 3(8)

of the General Clauses Act, as it stood before the 26th of

January, 1950, the expression "Central Government" included,

in the case of a Chief Commissioner's Province, the Chief

Commissioner acting within the scope of authority given to

him under section 94(3) of the Government of

744

India Act, 1935. Article 239 of the Constitution which

corresponds to section 94(3) of the Government of India Act,

though it is much wider in scope, provides that a State

specified in Part C of the First Schedule shall be

administered by the President acting, to such extent as he

thinks fit, through a Chief Commissioner or a Lieutenant

Governor to be appointed by him or through the Government of

a neighbouring State. Agreed to this constitutional

provision section 3(8 ) (b) (ii) Of the General Clauses Act,

as amended by the Adaptation Laws Order, 1950, lays down

that the expression "Central Government" shall include inter

alia the Chief Commissioner of a Part C State acting within

the scope of the authority given to him under article 239 of

the Constitution. Ajmer was admittedly a Chief Commis-

sioner's Province under section 94(1) of the Government of

India -Act, 1935. It has become a Part C State after the

coming into force of the Constitution. As has been stated

already, the Central Government issued a notification on the

16th of March, 1949, under section 94(3) of the Government

of India Act, directing that the function of the

"appropriate Government" under the Minimum Wages Act would,

in respect of any Chief Commissioner's Province, be

exercised by the Chief Commissioner. There was no such

delegation of authority however under article 239 of the

Constitution after the Constitution came into force. Mr.

Chatterjee contends that in the absence of such delegation

under article 239 the Chief Commissioner of Ajmer cannot be

regarded as "Central Government" as defined in section 3(8)

(b) (ii) of the General Clauses Act as it stands at present

and consequently he could not be held to be the "appropriate

Government" within the meaning of section 2(b) (ii) of the

Minimum Wages Act. The Government of India Act, it is said,

stands repealed by article 395 of the Constitution. An

order issued under section 94(3) of the Government of India

Act cannot possibly be operative after the inauguration of

the Constitution, nor could it be regarded as an order made

under article 239 of the Constitution.

The contention does not appear to us to be sound. A

complete reply to this argument is furnished, in our

745

opinion, by the provisions of clauses (1) and (2) of article

372 of the Constitution. Article 372 runs as follows:

"372. (1) Notwithstanding the repeal by this

Constitution of the enactments referred to in article 395

but subject to the other provisions of this Constitution,

all the law in force in the territory of India immediately

before the commencement of this Constitution shall continue

in force therein until altered or repealed or amended by a

competent Legislature or other competent authority.

(2) For the purpose of bringing the provisions of any

law in force in the territory of India into accord with the

provisions of this Constitution, the President may by order

make such adaptations and modifications of such law, whether

by way of repeal or amendment, as may be necessary or

expedient, and provide that the law shall, as from such date

as may be specified in the order, have effect subject to the

adaptations and modifications so made, and any such

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adaptation or modification shall not be questioned in any

court of law."

Thus clause (1) of the article provides for continuance,

in force, of the existing laws notwithstanding the repeal by

the Constitution of the enactments mentioned in article 395

and clause (2) provides for their adaptation with a view to

bring them into accord with the provisions of the

Constitution. The Government of India Act, 1935,

undoubtedly stands repealed by article 395 of the

Constitution, but laws made thereunder which were in

existence immediately before the commencement of the

Constitution would continue under article 372(1) and could

be adapted :under the second clause of that article. Mr.

Chatterjee argues that article 372 has no application to the

present case inasmuch as the order made by the Central

Government under section 94(3) of the Government of India

Act could not be regarded as "a law in force" within the

meaning of article 372. A distinction is sought to be made

by the learned counsel between an "existing law" as defined

in article 366(10) and a "law in force" and it is argued

that though an "order" can come within the definition

746

of "existing law", it cannot be included within the

expression "law in force" as used in article 372. It is

argued next that even if the word "law" is wide enough to

include an order, that order must be a legislative and not a

mere executive order promulgated by an administrative

authority, and in support of this contention the learned

counsel has relied on a number of cases decided by the Privy

Council and the different High Courts in India.

The first point does not impress us much and we do not

think that there is any material difference between " an

existing law" and "a law in force". Quite apart from

article 366(10) of the Constitution, the expression "Indian

law" has itself been defined in section 3(29) of the General

Clauses Act as meaning any Act, ordinance, regulation, rule,

order, or bye-law which before the commencement of the

Constitution had the force of law in any province of India

or part thereof. In out opinion, the words "law in force"

as used in article 372 are wide enough to include not merely

a legislative enactment but also any regulation or order

which has the force of law. We agree with Mr. Chatterjee

that an order must be a legislative and not an executive

order before it can come within the definition of law. We

do not agree with him however to ' at the order made by the

Governor-General in the present case under section 943) of

the Government of India Act is a mere executive order. Part

IV of the Government of India Act, 1935, which begins with

section 94, deals with Chief Commissioners' Provinces and

sub-section (3) lays down how a Chief Commissioner's

Province shall be administered. It provides that it shall

be administered by the Governor-General acting through a

Chief Commissioner to such extent as he thinks fit. An

order made by the Governor-General under section 94(3)

investing the Chief Commissioner with-the authority to

administer a province is really in the nature of a legis-

lative provision which defines the rights and powers of the

Chief Commissioner in respect to that province. In our

opinion such order comes within the purview of article 372

of the Constitution and being "a law in force" immediately

before the commencement of the

747

Constitution would continue to be in force under clause (1)

of the article. Agreeably to this view it must also be held

that such order is capable of adaptation to bring it in

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accord with the Constitutional provisions under clause (2)

of article 372 and this is precisely what has been done by

the Adaptation of Laws Order, 1950. Paragraph 26 of the

Order runs as follows:

"Where any rule, order or other instrument was in force

under any provision of the Government of India Act, 1935, or

under any Act amending or supplementing that act,

immediately before the appointed day, and such provision is

re-enacted with or without modifications in the

Constitution, the said rule, order or instrument shall, so

far as applicable, remain in force with the necessary

modifications as from the appointed day as if it were a

rule, order or instrument of the appropriate kind duly made

by the appropriate authority under the said provision of the

Constitution, and may be varied or revoked accordingly."

Thus the order made under section 94(3) of the

Government of India Act should be reckoned now as an order

made under article 239 of the Constitution and we are unable

to agree with Mr. Chatterjee that it was beyond the

competence of the President under clause (2) of article 372

to make the adaptation order mentioned above. The first

contention of Mr. Chatterjee therefore fails.

Coming now to the second point. Mr. Chatterjee points

out that the preamble to the Minimum Wages Act as well as

its title indicate clearly that the intention of the

Legislature was to provide for fixing minimum wages in

certain employments only and that the Legislature did not

intend that all employments should be brought within the

purview of the Act. The schedule attached to the Act gives

a list of the employments and it is in respect to the

scheduled employments that the minimum wages are to be

fixed. Under section 27 of the Act however' power has been

given to the "appropriate Government" to add to either part

of the schedule any employment in respect to which it is of

opinion that minimum wages shall be fixed by giving

notification in a particular manner, and

748

thereupon the schedule shall, in its application to the

State, be deemed to be amended accordingly. It is argued

that the Act nowhere formulates a legislative policy

according to which an employment shall be chosen for being

included in the schedule. There are no principles

prescribed and no standard laid down which could furnish an

intelligent guidance to the administrative authority in

making the selection. The matter is left entirely to the

discretion of the "appropriate Government" which can amend

the schedule in any way it likes and such delegation of

power virtually amounts to a surrender by the Legislature of

its essential legislative function and cannot be held valid.

There is undoubtedly an element of delegation implied

in the provision of section 27 of the Act, for the

Legislature in a sense, authorises another body, specified

by it, to do something which it might do itself But such

delegation, if it can be so called at all, does not in the

circumstances of the present case appear to us to be

unwarranted and unconstitutional. It was said by O'Connor

J. of the High Court of Australia in the case of Baxter v.

Ah Way (1):

"The aim of all legislatures is to project their minds as

far as possible into the future, and to provide in terms as

general as possible for all contingencies likely to arise in

the application of the law. But it is not possible to

provide specifically for all cases and, therefore,

legislation from the very earliest times, and particularly

in modern times, has taken the form of conditional

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legislation, leaving it to some specified authority to

determine the circumstances in which the law shall be

applied, or to what its operation shall be extended, or the

particular class of persons or goods to which it shall be

applied."

The facts of this Australian case, in material features,

bear a striking resemblance to those of the present one.

The question raised in that case related to the validity of

certain provisions of the Customs Act of 1901. The Act

prohibited the importation of certain goods which were

specifically mentioned and then gave power to the Governor-

General in Council to include, by

(1) 8 C.L.R. 626 at 637.

749

proclamation, other goods also within the prohibited list.

The validity of the provision was challenged on the ground

of its being an improper delegation of legislative powers.

This contention was repelled and it was held that this was

not a case of delegation of legislative power but of

conditional legislation Of the type which was held valid by

the Privy Council in the case of Reg v. Burah (1). It can

indeed be pointed out that in Burah's case what was left to

the Lieutenant Governor was the power to apply the

provisions of an Act to certain territories at his option

and these territories to which the Act could be extended

were also specified in the Act. The Legislature could be

said therefore to have applied its mind to the question of

the application of the law to particular places and it was

left to the executive only to determine when the laws would

be made operative in those places. According to the High

Court of Australia the same principle would apply even when

the executive is given power to determine to what other

persons or goods the law shall be extended besides those

specifically mentioned therein. Whether a provision like

this strictly comes within the description of what is called

"conditional legislation" is not very material. The

question is, whether it exceeds the limits of permissible

delegation. As was said by O'Connor J. himself in the above

case, when a Legislature is given plenary power to legislate

on a particular subject there must also be an implied power

to make laws incidental to the exercise of such power. It

is a fundamental principle of constitutional law that

everything necessary to the exercise of a power is included

in the grant of the power. A Legislature cannot certainly

strip itself of its essential functions and vest the same on

an extraneous authority. The primary duty of law making has

to be discharged by the Legislature itself but delegation

may be resorted to as a subsidiary or an ancillary measure.

Mr. Chatterjee contends that the essential legislative

function is to lay down a policy and to make it a binding

rule of conduct. This legislative policy, he says, is not

discernible anywhere in the

(1) 3 App. Cas. 889.

96

750

provisions of this Act and consequently there is no standard

or criterion to guide the administrative authority in the

exercise of the subsidiary legislative powers. We do not

think that this is the correct view to take. The legislative

policy is apparent on the face of the present enactment.

What it aims at is the statutory fixation of minimum wages

with a view to obviate the chance of exploitation of labour.

The Legislature undoubtedly intended to apply this Act not

to all industries but to those industries only where by

reason of unorganized labour or want of proper arrangements

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 12

for effective regulation of wages or for other causes the

wages of labourers in a particular industry were very low.

It is with an eye to these facts that the list of trades has

been drawn up in the schedule attached to the Act but the

list is not an exhaustive one and it is the policy of the

Legislature not to lay down at once and for all time to

which industries the Act should be applied. Conditions of

labour vary under different circumstances and from State to

State and the expediency of including a particular trade or

industry within the schedule depends upon a variety of facts

which are by no means uniform and which can best be

ascertained by the person who is placed in charge of the

administration of a particular State. It is to carry out

effectively the purpose of this enactment that power has

been given to the "appropriate Government" to decide, with

reference to local conditions, whether it is desirable that

minimum wages should be fixed in regard to a particular

trade or industry which is not already included in the list.

We do not think that in enacting section 27 the Legislature

has in anyway stripped itself of its essential powers or

assigned to the administrative authority anything but an

accessory or subordinate power which was deemed necessary to

carry out the purpose and the policy of the Act. The second

contention of Mr. Chatterjee cannot therefore succeed.

The third and the last point raised by Mr. Chatterjee

is directed against the notification of the Chief Com-

missioner by which he extended the term of the Advisory

Committee till the 20th of September, 1952. It is argued

that the term of the committee, as originally

751

fixed, expired on the 16th of July, 1952, and on and from

the 17th of July all the members of the committee became

functus officio. The Commissioner therefore was not

competent to give a fresh lease of life to the committee

which was already dead. We do not think that there is much

substance in this contention. Rule 3 of the rules framed

under section 30 of the Act expressly lays down that the

State Government may fix the term of the committee when it

is constituted and may from time to time extend it as

circumstances require. The State Government had therefore a

right to extend the term of the committee in such way as it

liked. The only question is whether it could do so after

the period originally fixed had come to an end. Mr.

Chatterjee relied, in this connection,. upon certain cases

which held that the Court could not grant extension of time

in an arbitration proceeding after the award was filed and

an award made after the prescribed period is a nullity. In

our opinion this analogy is not at all helpful to the

appellants in the present case. It is not disputed that the

committee did not function at all and did no work after the

16th of July, 1952, and before the 21st of August next when

its term was extended. No report was submitted during this

period and there was no extension of time granted after the

submission of the report. Assuming that the order of the

21st August, 1952, could not revive a committee which was

already dead, it could certainly be held that a new

committee was constituted on that date and even then the

report submitted by it would be a perfectly good report.

Quite apart from this, it is to be noted that a committee

appointed under section 5 of the Act is only an advisory

body and that the Government is not bound to accept any of

its recommendations. Consequently, procedural

irregularities of this character could not vitiate the final

report which fixed the minimum wages. In our opinion,

neither of the contentions raised in support of these

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 12 of 12

appeals can succeed and both the appeals therefore should

fail and stand dismissed with costs.

Appeals dismissed.

752

Reference cases

Description

The Edward Mills Co. Ltd. v. The State of Ajmer: A Landmark Ruling on Delegated Legislation and Constitutional Powers

The Supreme Court of India's judgment in The Edward Mills Co. Ltd. v. The State of Ajmer (1954) stands as a pivotal ruling in Indian constitutional and administrative law, particularly concerning the interpretation of the Minimum Wages Act, 1948. This case, extensively documented and analyzed on platforms like CaseOn, delves into the intricate relationship between pre-constitutional laws, the authority of administrative bodies post-constitution, and the permissible limits of delegating legislative power. The Court’s decision clarified crucial questions about the continuity of laws under Article 372 of the Constitution and affirmed the legislature's power to entrust ancillary functions to the executive to achieve its policy objectives.

Background of the Case

The case arose after the Central Legislature enacted the Minimum Wages Act, 1948, to prevent the exploitation of labor by fixing minimum wage rates in specified employments. The Act's schedule did not initially include the textile industry. Section 27 of the Act, however, empowered the “appropriate Government” to add other employments to this schedule.

In 1949, under the Government of India Act, 1935, the Central Government directed that the Chief Commissioner of a province would exercise the powers of the “appropriate Government.” Following this, the Chief Commissioner of Ajmer, after India became a Republic, initiated the process to include the textile industry under the Act's purview. An advisory committee was formed to recommend minimum wage rates. However, the committee's functioning was marked by procedural issues, including the extension of its term after the original period had expired. Ultimately, the Chief Commissioner issued a notification on October 7, 1952, fixing the minimum wages for textile workers in Ajmer.

The petitioners, The Edward Mills Co. Ltd., and other textile mills, challenged this notification, arguing it was illegal and unconstitutional on several grounds, leading to the case reaching the Supreme Court.

Legal Issues at the Forefront

The Supreme Court was tasked with deciding on three primary legal contentions raised by the appellants:

  1. Was the Chief Commissioner of Ajmer competent to function as the “appropriate Government” under the Minimum Wages Act without a specific delegation of power by the President under Article 239 of the new Constitution?
  2. Does Section 27 of the Minimum Wages Act, which allows the government to add employments to the schedule, constitute an unconstitutional delegation of essential legislative power?
  3. Did the retrospective extension of the Advisory Committee's term after its expiry invalidate its report and the final notification based on it?

Unpacking the Supreme Court's Judgment: The IRAC Method

Issue 1: The Authority of the Chief Commissioner

The core of the first challenge was whether the authority granted to the Chief Commissioner under the pre-constitutional Government of India Act, 1935, survived the enactment of the Constitution of India.

Rule of Law Applied

  • Article 372 of the Constitution of India: This article provides for the continuance of existing laws and their adaptation. It states that all laws in force in India immediately before the commencement of the Constitution shall continue in force until altered, repealed, or amended.
  • Article 239 of the Constitution of India: This article deals with the administration of Part C states (like Ajmer at the time), stipulating they shall be administered by the President through a Chief Commissioner.
  • Section 94(3) of the Government of India Act, 1935: This provision allowed the Governor-General to administer a Chief Commissioner's province. The order delegating power to the Chief Commissioner was made under this section.

Court's Analysis

The Court rejected the petitioner's argument. It held that the term 'law in force' in Article 372 is wide enough to include not just legislative enactments but also orders and regulations that have the force of law. The Court reasoned that the order made by the Governor-General under Section 94(3) of the 1935 Act was not merely an executive order but a legislative provision defining the powers of the Chief Commissioner.

As this order was a 'law in force' right before the Constitution came into effect, it continued to be valid under Article 372(1). Furthermore, the Adaptation of Laws Order, 1950, passed by the President, explicitly provided for the adaptation of such orders to align with the new constitutional framework. This adaptation effectively made the old order equivalent to one made under Article 239. Therefore, the Chief Commissioner was competent to act as the “appropriate Government.”

Issue 2: The Constitutionality of Section 27 of the Minimum Wages Act

The appellants contended that Section 27 gave unfettered and unguided power to the government to add any industry to the Act's schedule, amounting to a surrender of the legislature's essential law-making function.

Rule of Law Applied

  • Doctrine of Permissible Delegation: A well-established principle holds that while a legislature cannot delegate its essential functions (like determining legislative policy), it can delegate subsidiary or ancillary powers to the executive to implement and administer the law. The legislature must lay down the policy and provide a standard or guidance for the executive.

Court's Analysis

The Supreme Court held that the delegation under Section 27 was valid and within constitutional limits. It observed that the legislative policy was clearly apparent from the preamble and the overall scheme of the Minimum Wages Act. The Act’s purpose is to prevent the exploitation of labor in industries where wages are exceptionally low due to a lack of organization or bargaining power among workers.

The legislature, unable to foresee all future conditions across different states, rightfully left it to the “appropriate Government” to determine, based on local conditions, which specific industries required the protection of the Act. This, the Court concluded, was not a delegation of essential legislative power but a delegation of a subordinate function to carry out the Act's declared policy. The government’s power was not unguided; it was guided by the objective of the Act itself.

Understanding the nuances of delegated legislation can be complex. For legal professionals looking to quickly grasp the core arguments and rulings in landmark cases like this, CaseOn.in 2-minute audio briefs provide concise and insightful summaries, making case law analysis more efficient.

Issue 3: The Validity of the Advisory Committee's Proceedings

The final challenge was based on a procedural flaw: the government extended the advisory committee’s term after it had already expired, which the appellants claimed made the committee defunct and its report invalid.

Rule of Law Applied

  • Section 5 of the Minimum Wages Act, 1948: This section mandates the appointment of an advisory committee to hold inquiries and advise the government on fixing minimum wages.
  • Rule 3 of the Rules under the Act: This rule empowered the State Government to fix and extend the term of the committee as circumstances require.

Court's Analysis

The Court dismissed this argument by adopting a pragmatic approach. It held that the advisory committee's role is, as its name suggests, purely advisory. The government is not bound to accept its recommendations. The final decision to fix the wages rests solely with the government.

Given the advisory nature of the committee, procedural irregularities in its functioning, such as the timing of its term extension, could not vitiate the final, independently made decision of the government. The Court also noted that even if the order was seen as constituting a new committee, the report would still be valid. The Court emphasized that such procedural defects did not cause a failure of justice or prejudice the appellants and were not fatal to the final notification.

The Final Verdict

The Supreme Court found no merit in any of the contentions raised by the appellants. It upheld the constitutional validity of Section 27 of the Minimum Wages Act, affirmed the authority of the Chief Commissioner of Ajmer, and ruled that the procedural irregularities concerning the advisory committee did not invalidate the wage-fixing notification. Consequently, the appeals were dismissed with costs.

Why This Judgment Matters: Key Takeaways for Legal Professionals

The Edward Mills Co. Ltd. v. The State of Ajmer is a cornerstone judgment for lawyers and law students for several reasons:

  • Understanding Constitutional Transition: It provides a clear interpretation of Article 372, explaining how pre-constitutional laws, including orders and regulations, transition into the new constitutional era.
  • Clarifying Delegated Legislation: The case is a leading authority on the limits of delegated legislation. It establishes that as long as the legislature outlines a clear policy, it can delegate the power to the executive to apply that policy to specific situations based on local needs.
  • Pragmatism in Administrative Law: It highlights the judiciary's focus on substance over form. The Court's decision on the advisory committee underscores that minor procedural lapses in an advisory body’s functioning will not nullify a final administrative action, especially when the body's role is not determinative.

This ruling remains highly relevant in debates on the scope of executive power and the framework of social welfare legislation in India.


Disclaimer: The information provided in this article is for informational purposes only and does not constitute legal advice. It is a summary and analysis of a court judgment and should not be used as a substitute for professional legal consultation.

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