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Smart Summary

Judgment Summary — D.K. Jain, J., High Court of Delhi

Factual and Procedural Background

The petitioner, employed as an Accounts Clerk by the All India Khadi and Village Industries Board since 13 December 1956, had his services taken over by the Khadi and Village Industries Commission (the Commission) after the Commission's establishment under the Khadi and Village Industries Commission Act, 1956. He worked at Khadi Gramodyog Bhawan, New Delhi. The Management suspended him on 13 October 1970, issued a charge-sheet dated 22 December 1970 alleging irregularities and embezzlement, and subsequently terminated his services. The petitioner denied the allegations, sought reinstatement by a notice dated 16 May 1972 and, on not being reinstated, raised an industrial dispute.

After unsuccessful conciliation, the Lt. Governor, Delhi referred the dispute to the Presiding Officer, Labour Court, Delhi by notification dated 16 February 1973. The reference posed the question whether the petitioner's services had been terminated illegally and, if so, what relief was appropriate. The Management raised preliminary objections before the Labour Court, including that the Khadi Gramodyog Bhavan was a unit of the Commission and therefore the appropriate Government was the Central Government, making the Lt. Governor's reference ultra vires.

The Labour Court framed preliminary issues, found in favour of the petitioner on certain issues, but held (in its award dated 11 October 1973) that the Appropriate Government was the Central Government and that the reference by the Lt. Governor (Delhi Administration) was therefore incompetent. The petitioner then approached the Chief Labour Commissioner (Central) requesting the Central Government to make a reference; by communication dated 30 July 1974 the Chief Labour Commissioner informed the petitioner that the Delhi Administration was the Appropriate Government and advised him to approach the State authorities.

The petitioner filed a writ petition under Article 226 and 227 of the Constitution seeking (i) quashing of the Labour Court award to the extent it held the Delhi Administration not to be the Appropriate Authority to make the reference and a direction to the Labour Court to adjudicate the dispute on merits, or (ii) alternatively, quashing of the communication dated 30 July 1974 and a direction to the Central Government to examine making the reference as the Appropriate Government. Respondents did not file counter-affidavits and were unrepresented at hearing.

Legal Issues Presented

  1. Which is the 'Appropriate Government' for the purpose of Section 2(a) of the Industrial Disputes Act — the Central Government or the State Government (Delhi Administration) — in relation to the Khadi and Village Industries Commission and Khadi Gramodyog Bhawan?
  2. Was the reference made by the Lt. Governor (Delhi Administration) to the Labour Court ultra vires because the Appropriate Government was the Central Government?
  3. Whether the Labour Court erred in declining adjudication of the dispute on merits on the ground that the Central Government was the Appropriate Government.

Arguments of the Parties

Management's (Respondent No. 3) Arguments

  • The Khadi Gramodyog Bhavan is a unit of the Khadi and Village Industries Commission, which was set up under an Act of Parliament and whose activities are carried on by or under the authority of the Central Government.
  • Therefore, under Section 2(a) of the Industrial Disputes Act the Appropriate Government is the Central Government, and the Lt. Governor's reference was ultra vires and could not be entertained by the Labour Court.

Petitioner's Arguments (as presented by Mr. V. P. Chaudhry, Senior Advocate)

  • The Commission is not enumerated in the list of corporations/companies in Section 2(a)(i) of the Industrial Disputes Act; respondent No. 3 is not within those specified categories and therefore the Commission is not an industry carried on under the authority of the Central Government.
  • The Khadi and Village Industries Commission Act does not state that the Commission acts on behalf of the Central Government; the functions enumerated in Section 15 indicate the Commission does not perform substantial governmental functions but rather developmental/commercial functions in relation to khadi and village industries.
  • Alternatively, if the Court concluded the Central Government is the Appropriate Government, the refusal by the Central Government to make a reference would be illegal and the Central Government should be directed to make the reference to the Labour Court for adjudication.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Cantonment Board, Ambala Cantt v. State of Punjab, AIR 1961 Punjab 416(7) Held that the Cantonment Board, created by statute and exercising functions of government, was directly carrying on the work of the Government and therefore came within industries carried on "by or under the authority of the Central Government". The Labour Court had relied on this decision to treat the Commission as "carried on by or under the authority of the Central Government". The High Court distinguished the Cantonment Board case on the basis that Cantonment Boards perform governmental (sovereign) functions, whereas the Commission performs commercial/developmental functions.
Heavy Engineering Mazdoor Union v. State of Bihar, AIR 170 SC 82(2) Explained that a corporation will ordinarily not be treated as an agent or servant of the State merely because it is controlled or funded by the State; a corporation performing governmental functions may be treated as acting under the authority of the Government, whereas one performing commercial functions will not be. The Court applied this principle to conclude that despite administrative and financial control by the Central Government, the Commission carries on commercial activities and acts on its own behalf; therefore it is not an industry carried on by or under the authority of the Central Government within Section 2(a)(i) of the Industrial Disputes Act.
Khadi Gramodyog Sangh, Muzaffarpur v. State of Bihar, 1977 LIC 466 (Patna High Court) Held that a Khadi Sangh financed and supervised by the Central Government (through the Commission) could not be brought within the phrase "under the authority of" the Central Government if it performed non-sovereign/commercial functions, applying Heavy Engineering Mazdoor Union's reasoning. The High Court observed that the ratio of this Patna High Court decision squarely applied to the instant facts and supported the conclusion that the Commission and the Bhawan were not carried on "under the authority of" the Central Government.
Central Warehousing Corporation v. Delhi Administration & Ors., (1983) 63 FIR 125(3) Held that Central Warehousing Corporation, though a body corporate with entire capital held by the Central Government and under extensive control, was a commercial corporation and not a servant or agent of the Central Government; therefore the Central Government was not the Appropriate Government under Section 2(a)(i) before it was specifically included by amendment. The Court relied on this decision to support the distinction between commercial functions and governmental functions and to reinforce that pervasive control, by itself, does not make a corporation an agent of the Government for the purpose of deciding the Appropriate Government.

Court's Reasoning and Analysis

The Court identified the central statutory provision as Section 2(a) of the Industrial Disputes Act, which defines "Appropriate Government" in two parts: clause (i) (Central Government in relation to industries carried on by or under the authority of the Central Government or specific undertakings) and clause (ii) (residuary — State Government for other disputes). The decisive question was whether the Commission (and therefore Khadi Gramodyog Bhawan) fell within clause (i).

The Labour Court had concluded that the Commission was carried on by or under the authority of the Central Government on the basis of features such as:

  • Statutory creation of the Commission with powers of a body corporate;
  • Nomination/appointment of its Chairman, Vice-Chairman, members, Secretary and Financial Adviser by the Central Government;
  • Central Government's power to issue directions to the Commission, provide its funds, approve and supervise its budget, and dissolve the Commission;
  • The Commission's financial and administrative control by the Central Government.

The Court accepted that these indicia show pervasive administrative and financial control. However, it examined other statutory provisions (Sections 15, 17A, 19, 21 and 22 of the Khadi and Village Industries Commission Act) to determine the nature of the Commission's activities and liabilities. Important observations made by the Court included:

  • Section 15 confers on the Commission functions to plan, organise and implement programmes for development of khadi and village industries, including sale and marketing — activities of commercial and developmental character.
  • Sections empowering the Commission to receive gifts/grants, spend sums for authorised purposes, borrow on security of funds, and Section 22 deeming liabilities and contracts connected with development matters to be those of the Commission indicate the Commission acts and incurs liabilities on its own behalf.
  • Although Section 16 binds the Commission to follow directions of the Central Government, the statutory scheme overall permits the Commission to act as a corporate entity carrying on commercial activities necessary for its objectives.

The Court then applied the legal distinction articulated in Heavy Engineering Mazdoor Union's case: a corporate entity wholly or largely funded or controlled by government is not automatically an agent of the State; only where it performs governmental/sovereign functions may it be regarded as acting "by or under the authority of" the Government. The Court concluded that the Commission performs commercial/developmental functions and not sovereign governmental functions; therefore it is not an industry carried on by or under the authority of the Central Government within Section 2(a)(i).

The Court rejected the Labour Court's reliance on the Punjab High Court's Cantonment Board decision because that decision concerned bodies performing governmental functions in substance, making it distinguishable. The Court also relied on the Patna High Court decision in Khadi Gramodyog Sangh and the earlier decision concerning Central Warehousing Corporation to support its view that statutory creation plus control does not equate to being an agent of the Central Government where the functions are commercial.

Having reached the conclusion that the Commission and Khadi Gramodyog Bhawan were not carried on by or under the authority of the Central Government, the Court held that the Appropriate Government was the State Government (Delhi Administration) and that the reference by the Lt. Governor was competent. Consequently, the Labour Court was in error in holding otherwise and in declining adjudication on merits.

Holding and Implications

Holding: The High Court held that the Labour Court erred in concluding that the Central Government was the 'Appropriate Government' for the petitioner’s dispute. The Commission and Khadi Gramodyog Bhawan were not industries carried on by or under the authority of the Central Government for the purposes of Section 2(a)(i) of the Industrial Disputes Act. Accordingly,

Rule made absolute; the impugned award of the Labour Court is set aside to the extent it holds that the Lt. Governor (Delhi Administration) was not competent to make the reference, and the matter is remitted back to the Labour Court for adjudication on merits.

Implications:

  • Direct effect: The Labour Court's decision declining to adjudicate on the ground that the Central Government was the Appropriate Government is quashed in part; the Labour Court must proceed to decide the dispute on merits.
  • Procedural direction: The Court directed the Labour Court to decide the matter expeditiously, noting the reference was made in 1973.
  • Precedential scope: The judgment applies the established distinction (as stated in Heavy Engineering Mazdoor Union's case and related authorities) between corporations performing sovereign/governmental functions (which may fall within "under the authority of" the Government) and those performing commercial/developmental functions (which do not). The opinion confines its holding to the statutory scheme and facts before it and does not state that it is laying down a broader novel precedent beyond applying the cited authorities.

Costs: No costs were ordered.

    Shri Nand Kishore Jain Petitioners v. The Presiding Officer Labour Court, Delhi & Others

    D.K Jain, J.:— The petitioner was employed as an Accounts Clerk by the All India Khadi and Village Industries Board on 13 December, 1956. After Khadi and Village Industries Commission (hereinafter referred to as ‘the Commission’) was established under Section 4 of, the Khadi and Village Industries Commission Act, 1956 (for short the Act), the services of the petitioner were taken over by the Commission. The petitioner was posted and all through worked in the Khadi Gramodyog Bhawan, New Delhi. The management of Khadi Gramodyog Bhawan (hereinafter referred to as ‘the Management’), placed the petitioner under suspension on 13 October, 1970 and eventually served a charge sheet dated 22 December, 1970, accusing him of certain irregularities and embezzlement of funds. The petitioner denied the allegation. His services were terminated. Aggrieved by the said termination of his services, the petitioner sent a notice of demand to the management on 16 May, 1972 asking for his reinstatement. Since his request was not acceded to the petitioner raised an industrial dispute. The conciliation proceedings having failed, the Lt. Governor, Delhi referred the dispute for adjudication to the Presiding Officer, Labour Court, Delhi by a notification dated 16 February, 1973, and the dispute specified in the order of reference was:—

    “Whether services of Shri Nand Kishore Jain have been terminated illegally and/or without any justification and if so, to what relief is he entiled and what directions are necessary in this respect.”

    2. Before the Labour Court, while supporting its action of termination of services of the petitioner, the management raised three preliminary objections, the one relevant presently being in the following terms:

    “That the Khadi Gramodyog Bhavan is a unit of Khadi and Village Industries Commission, which was set up under an Act of Parliament, namely the Khadi and Village Industries Act, 1956 (Act No. 61 of 1956). Having regard to the provisions of the said Act, it is clear that the activities of the Commission are carried on by or under the authority of the Central Government. As such the appropriate Govt. in the case of the Bhavan is the Central Government. The present reference made by the Lt. Governor is, therefore, ultra vires his powers and the present reference cannot, therefore, be entertained by this hon'ble Tribunal.”

    On the pleadings of the parties, the Labour Court framed the following preliminary issues:

    “(1) Whether a demand was made on the management in respect of this subject matter of the reference? If not its effect?

    (2) Whether the reference is ultra vires of the powers of the Government for the reasons given in para 2 of the preliminary objections in the written statement?”

    (3) Whether the Khadi Gramodyog Bhavan is not an industry?”

    3. During the course of arguments before the Labour Court the management did not press the preliminary issue No. 3. By its award dated 11 October 1973, which is impugned in this writ petition, the Labour Court found issues No. 1 and 3 in favour of the petitioner. On issue No. 2 the Labour Court returned the finding that the Appropriate Government was the Central Government and as such reference in the case could only be made by the Central Government and not by the Delhi Administration and, therefore, adjudication of the dispute could not be made in that reference.

    4. In view of the said award, holding that the Central Government was the ‘Appropriate Government’ to refer the disputes for adjudication, the petitioner, making a specific mention of Labour Court's finding regarding reference by the State Government, filed a statement of claim before the Chief Labour Commissioner (Central) Ministry of Labour and Rehabilitation with a request that the industrial dispute raised by him may be referred for adjudication by the Central Government. By a communication dated 30 July 1974, the Chief Labour Commissioner (Central) informed the petitioner that the Delhi Administration was the ‘Appropriate Government’ in the matter and, therefore, advised him to approach the concerned State Labour authorities in the matter.

    5. Aggrieved as left in the lunch, the petitioner has filed this writ petition under Article 226 and 227 of the Constitution seeking a writ of certiorari or any other appropriate writ, order or direction quashing the award dated 11 October 1973 in so far as it holds that the Delhi Administration is not the ‘Appropriate Authority’ to make the reference, with a further direction to the Labour Court to adjudicate upon the dispute on merits. In the alternative, the petitioner prays for quashing of the aforesaid communication dated 30 July 1974 whereby the Central Government has declined to make a reference, with a further direction to the Central Government to examine the making of the reference in the case by proceeding on the basis that it is the ‘Appropriate Government’ for the purpose. Presiding Officer, Labour Court is cited as respondent No. 1, respondent No. 2 is the Delhi Administration, through Secretary (Labour); respondent No. 3 is the management of Khadi Gramodyog Bhawan and respondent No. 4 is the Union of India through the Secretary, Ministry of Labour & Rehabilitation.

    6. Although Rule was issued as far back as in November 1974 and all the respondents reportedly served, counter-affidavit has not been filed by any of the respondents and they remained un-represented even at the time of hearing. I have heard Mr. V. P. Chaudhry Senior Advocate, for the petitioner and gone through the award.

    7. Mr. Chaudhry has contended that the Labour Court fell into error in holding that the ‘Appropriate Government’ in the matter of reference was the Central Government. His argument is two fold: (i) the companies/corporations/bodies in respect of which the appropriate Government is the Central Government have been enumerated in Section 2 (a) (i) of the Industrial Disputes Act, 1947 and respondent No. 3 not being one of those mentioned there, the Commission is not an industry which is being carried on under the authority of the Central Government; and (ii) that the Act nowhere lays down that the Commission would act on behalf of the Central Government and infact a perusal of the functions of the Commission, as enumerated in Section 15 of the Act, indicates that the Commission cannot be said to be performing any substantial Government functions. Alternatively, it is submitted that if the view taken by the Labour Court that the Central Government is the ‘Appropriate Government’ to make a reference is found to be correct, the refusal of the Central Government to make a reference is illegal and the Central Government has no option but to make a reference to the Labour Court for adjudication of the dispute raised by the petitioner and a declaration in that behalf may be made.

    8. The prime question arising for consideration is as to which is the ‘Appropriate Government’ in the matter viz., the Central Government or the State Government? Section 2 (a) of the Industrial Disputes Act defines the term “Appropriate Government”, relevant portion whereof is extracted below:

    “2. ............

    (a) “appropriate Government” means.—

    (i) in relation to any Industrial Disputes concerning any industry carried on by or under the authority of the Central Government or by a railway company or concerning any such controlled industry as may be specified in this behalf by the Central Government. Or in relation to an industrial dispute concerning a Dock Labour Board........or Industrial Financial Corporation of India................. .etc., a Cantonment Board, or a major port, the Central Government, and

    (ii) in relation to any other Industrial Dispute, the State Government;”

    9. It would appear that sub-section(a) of the said Section, defining the expression ‘Appropriate Government’ is in two parts. Clause (i) stipulates the industrial undertaking for whom the Central Government will be the ‘Appropriate Government’ while clause (ii) is residuary and lays down that in respect of industrial undertakings not falling in clause (i) the Appropriate Government would be the State Government. Thus, the crucial question for determination is firstly whether the Commission falls within the ambit of clause (i) of sub-section (a) of Section 2 of the Industrial Disputes Act and is an industry either: (a) carried on by or under the authority of the Central Government or (b) run by a railway company or (c) is a controlled industry specified in this behalf by the Central Government or (d) if the industrial dispute concerns one of the specific concerns/companies mentioned in the clause, if so, the ‘Appropriate Government,’ for it would be the Central Government else it would be the State Government. The position will be the same for Khadi Gramodyog Bhawan because carrying on of its activities by the Commission by itself or through any other person will not alter the position and it will continue to be an industry carried on by or under the authority of the Central Government within the meaning of Section 2(a)(i) of the said Act. Apparently, the Commission's name does not figure as such in clause (i); it is not a controlled industry within the meaning of the clause nor is it run by the railways and so does not fall within the ambit of categories (b), (c) and (d) mentioned above.

    10. As to whether the Commission is an industry carried on or run by or under the authority of the Central Government, the learned Labour Court, after examining various provisions of the Act, providing that there shall be a commission with effect from the date the Central Government notifies, which it did, it was a body corporate having perpetual succession and a common seal, with power to acquire, hold and dispose of property and to contract, can sue or be sued in its name, its Chairman, Vice-Chairman, members of the Board were to be nominated by the Central Government, which also was to appoint its Secretary and the Financial Adviser; it could issue directions to the Commission; the funds were to be provided by it; the Commission had to frame its budget and get it approved by the Central Government; after approval spend within the limits prescribed and submit returns, statements and such other particulars that the Central Government way ask for; the Central Government may dissolve the, Commission on which its property and funds were to vest in it; found, in view of it all, and following the decision of the Punjab High Court in Cantonment Board, Ambala Cantt v. State of Punjab, AIR 1961 Punjab 416(7) that the Commission was an industry being carried on by or under the authority of the Central Government, which was the ‘Appropriate Government’ and as such the reference by the Lt. Governor was illegal.

    11. Mr. Chaudhry's contention is that the omission of the Commission from the list of various other statutory corporations mentioned in the Section leads to the conclusion that the legislature never intended to treat it as an industry being carried on by and under the authority of the Central Government. I do not find much substance in it. From a bare reading of the Section, extracted above, it is evident that the list of corporations/companies mentioned therein is not the only criteria and the said sub-section brings within its ambit all other industries which are carried on by or under the authority of the Central Government etc., even if its name does not figure therein. However, learned counsels other contention that the Labour Court was in error, for reasons recorded, to hold that the Commission is an industry carried on by or under the authority of the Central Government has force.

    12. The Commission is established under Section 4 of the Act as a body corporate having perpetual succession with power to acquire, held and dispose of properly and to contract, and, may by the said name sue and be sued. Section 15 of the Act, inter alia, stipulates the functions of the Commission and lays down that the functions of the Commission shall generally be to plan, organise, and implement programmes for the development of khadi & village industries, which include the sale and marketing of khadi or all products of village industries. Section 17A enables the Commission to receive gifts, grants, donations or benefactions from the government or any other person for the purpose of development of village industries. Section 19 provides that the Commission shall have power to spend such sums as it thinks fit on purposes authorised by the Act. Section 21 clothes the Commission with the power to borrow on the security of the khadi fund or the village industries fund or any other asset for any purposes for which funds may be applied. Section 22 lays down that all liabilities incurred by and all contracts entered, into with and all matters and things engaged to be done by it or for the Central Government in connection with the development of khadi or village industries at any time after 14 January 1953 and before the commencement of the Act, shall, after such commencement be deemed to have been incurred by, entered into with or engaged to be done by or for the Commission.

    13. In Heavy Engineering Mazdoor Union v. State of Bihar, AIR 170 SC 82(2), a question arose whether an industry carried on by company incorporated under the Companies Act was an industry carried on “under the authority of” the Central Government and it was competent to make a reference under the Industrial Disputes Act. The Supreme Court pointed out, that in the absence of a statutory provision, a commercial corporation acting on its own behalf, even though it is controlled wholly or partially by a Government department, will be ordinarily presumed not to be a servant or agent of the State; such an inference that the Corporation, is the agent, of the Government may be drawn where it is performing in substance governmental and not commercial functions; and an industry carried on by or under the authority of the Central Government means either the industry carried on directly by a department of the Government, such as the Posts & Telegraph or the Railways, or one corried on by such department through the instrumentality of an agent. It was also pointed out that where a statute setting up a corporation states that the corporation should be an agent of the State then, it could be easily identified as such. In para 4 of the judgment it was held that the expression “an industry carried on, by or under the authority of the Central Government” as used in the definition of expression ‘Appropriate Government’ in Section 2(a)(i) of the Industrial Disputes Act would mean “pursuant to the authority, such as where an agent or a servant acts under or pursuant to the authority, of his principal or master”. The Supreme Court observed that although the entire share capital of the Heavy Engineering Corporation Ltd. was contributed by the Central Government and extensive powers had been conferred on it, yet the Corporation could not be said to be an industry carried on by or under the authority of the Central Government.

    14. In the instant case, the grounds forming basis of learned Labour Court's findings, pointed out above, are strict Administrative and Financial Control, in that the Commission is a creation of the statute, the Central Government nominates its top ranking functionaries, provides funds and exercises control on finances, nonetheless, the Commission has power to hold and dispose of property, can enter into contract, and has to be perform and delves in commercial activities, which it has to do as statutory body on its own.

    15. It is no doubt true that under Section 16 the Commission has been enjoined to be bound by the directions of the Central Government but the provisions of section 22 make it clear that all liabilities incurred by or all contracts entered into and all matters relating to and in connection with the development of khadi and village industries by the Central Government shall be deemed, after the commencement of the Act, to have been incurred by, entered into with, or done by the Commission itself (emphasis added). The Commission, a body corporate, acts on its own behalf and carries on commercial activities, like any other commercial establishment, which are necessary for the promotion and development of khadi and village industries and whatever liabilities it incurs in connection therewith are incurred by it on its own behalf and the Central Government is not liable for the same despite the fact that all its activities may be supervised by the Central Government. The Commission is performing commercial functions and not carrying on any sovereign functions of the Central Government. As is clear from various provisions of the Act, briefly referred to above, it is commercial establishment like any other commercial corporation carrying on purely commercial activities for the promotion of Khadi and village industries. So is Khadi Gramodyog Bhawan. That being so, neither the Commission nor Khadi Gramodyog Bhawan could be said to be agent, wing or a part to the Central Government, howsoever pervasive the control of the Central Government might be in its management. The Commission carries on business or industry act on behalf of the Central Government but on its own behalf.

    16. A similar view has been expressed in a Bench decision of the Patna High Court in Khadi Gramodyog Sangh, Muzaffarpur v. State of Bihar, 1977 LIC 466. In that case also a question had arisen as to which was the Appropriate Government in relation to Bihar Khadi Gramodyog Sangh which was financed by the Central Government, through the Commission which supervised and controlled the activities of the said Sangh. Relying on the judgement of the Supreme Court in Heavy Engineering Mazdoor Union's case (supra) it was held that neither the Commission nor the Sangh could be brought within the sweep of the phrase “under the authority of.” The ratio of this decision squarely applies to the facts of the instant case.

    17. Similarly, this Court (Avadh Behari, J) dealing with a like case in Central Warehousing Corporation v. Delhi Administration & Ors., (1983) 63 FIR 125(3) held that the Central Warehousing Corporation, prior to its inclusion in the list of specific undertakings mentioned in clause (i) by the Amending Act 46 of 1982, a statutory corporation established for the purpose of “warehousing of agricultural produce and certain other commodities and for matters connected therewith”, though it is a body corporate with perpetual succession and common seal and its entire capital is held by the Central Government and extensive control over its affairs is vested in the Central Government, is not a servant or agent of the Central Government. It is only a commercial corporation and is not carrying on any sovereign functions of the Central Government and, therefore, the Central Government was not the ‘Appropriate Government’ under Section 2 (a) (i) of the Industrial Disputes Act.

    18. In Cantonment Board, Ambala's case (supra) relied upon by the Labur Court, the Punjab High Court was dealing with the case of Cantonment Boards created and regulated by the provisions of the Cantonment Act, whereby the management of Cantonment was placed in the hands of the Cantonment Boards. Considering the scope of the creation of the Cantonment Boards by the statute and the powers of the Central Government over the administration of such cantonments through the cantonment boards, the Court held that the cantonment board is, infact, directly carrying on the work of the Government. Evidently the Punjab High Court came to this conclusion because the Cantonment Board was performing in substance the government functions and not commercial functions, as in the present case. As aforenoted, in Heavy Engineering Mazdoor Union's case (supra) a dear distinction has been brought out in the performance of government functions and commercial functions. The Supreme Court observed that while a Corporation performing the government functions could be said to be an agent of the government but the one performance commercial functions could not be so held. Thus the ratio of the Punjab High Court's judgement is not applicable to the facts of the instant case and the Labour Court was in error on placing reliance on the same.

    19. In view of the foregoing discussion I am of the opinion that the Labour Court fell into error in holding that the Appropriate Government was the Central Government and, therefore, its order, declining to adjudicate upon the dispute on merits cannot be sustained. The case of the petitioner, in my view, fails in the residuary clause and the Appropriate Government would be the State Government, which rightly made the reference. In that view of the matter, the alternative contention of Mr. Chaudhry is rendered infructuous.

    20. Consequently the impugned award of the Labour Court, to the extent it holds that the Lt. Governor was not competent to make the reference in petitioner's case, is set aside and the matter is remitted back to the Labour Court for adjudication on merits. Since the reference was made as far back as in 1973, the learned Court should try to decide it as expeditiously as possible. Rule is made absolute.

    No costs.

    A.K

    HIGH COURT OF DELHI: NEW DELHI

    CORRECTION SLIP

    Copy of Notification No. 495.Rules/DHC dated 17th November, 1995, published in Part-IV of Delhi Gazette, Extraordinary, No. 206 dated 17-11-1995.

    No. 495 Rules/DHC:—In exercise of the powers conferred by sections 122 & 129 of the code of civil procedure, 1908 and section 7 of the delhi high court act, 1966 (Apt of 1966) and all other powers enabling it in this behalf, the High Court of Delhi hereby makes the following amendments in the High Court Rules and Orders, Volume-V.:—

    In part II (Civil), Chapter 4-F(b), High Court Rules and Orders, Volume-V, relating to issue of writs after Rule 1, the following Rules shall be added, namely:—

    “1-A. If the respondent in a Civil Writ Petition is either the Union of India, National Capital Territory of Delhi, Lt. Governor, Delhi Development Authority, Municipal Corpration of Delhi, New Delhi Municipal Council, Delhi Electric Supply Undertaking, Delhi Transport Corporation, Nationalised Bank, Public Sector Undertaking Government Company, Insurance Company or any other statutory or public authority then the petition and paper books, with one extra copy, shall be delivered in advance to the nominated counsel (within the meaning of Rule 1-B) and acknowledgement obtained by the writ petitioner. The acknowledgement above-mentioned shall be deemed to be sufficient service in the Civil Writ Petition on the said Department/Authority above-mentioned. A letter will also be served on the nominated counsel that the matter will be coming up for admission in the next few days. It will be for the party/counsel of that Department/Authority above-mentioned to take note of the case in the cause list and be present when the matter or a C.M therein comes up for admission/hearing. Or else, the Court may set the said respondent exparte and pass orders.”

    “1-B. The Government and the authorities referred to in Rule 1-A shall nominate a counsel authorised to accept and acknowledge delivery of petition, paper books in the writ petitions filed or likely to be filed against it. A list of such nominated counsel shall be maintained in the Registry and shall also be given to the Bar Association.”

    In the aforesaid Part-II (Civil), of the High Court Rules and Orders, Volume-V, for Rule-2, the following shall be substituted, namely:—

    “2. The petition shall be posted before the Court for preliminary hearing and orders. Upon the hearing, the Court if satisfied that no case has been made out for its interference may dismiss the petition and if not so satisfied shall direct a rule nisi to be issued to the respondent calling upon him to show cause why the order sought should not be made, and shall adjourn the hearing for the respondent to appear and be heard.”

    In part 3-B of the High Court Rules and Orders, Volume-V, pertaining to jurisdiction of Single Judge and of Benches of the Court, for clause (a) of sub-rule (xviii) of rule 1, the following shall be substituted, namely:—

    “(xviii) (a). Application or petition under Article-226 of the Constitution of India for the issue of any directions, orders or writs in the nature of mandamus, prohibition, quo warranto or certiorari or for the enforcement of fundamental rights conferred by Part-III of the Constitution of India or for any other purpose, except:—

    (i) Petitions where vires of Acts are challenged;

    (ii) Petitions where personal liberty is involved;

    (iii) Petitions pertaining to all Revenue/Tax matters including intertainment taxes, except Municipal Tax;

    (iv) Petitions arising from the orders of the Board for Industrial and Financial Reconstruction/Appellate Authority for Industrial and Financial Reconstruction or seeking directions to them; and

    (v) Petitions pertaining to Public Interest Litigation.

    EXPLANATION: The preliminary hearing for the admission of applications and petitions pertaining to matters mentioned in clause (i) to (v) of clause (xviii) (a) above shall however be before a Bench of two Judges and before a Single Bench when there is no sitting of Division Bench.”

    These amendments shall come into force with effect from the first of January, 1996.

    By Order of the Court,

    (M. A. KHAN)

    REGISTRAR

    (I) Endst. No. 22681.85.Rules/DHC, dated 13-12-1995.

    Copy forwarded for information/necessary action to :—

    (1) P.P.S to Hon'ble the Chief Justice/P.A to Registrar.

    (2) All Private Secretaries to Hon'ble Judges for their Lordships' information.

    (3) All Joint Registrars/Deputy Registrars/Assistant Registrars/Court Masters/Superintendents of Delhi High Court.

    (4) Librarian, Delhi High Court.

    (5) Notice Board, Delhi High Court.

    (illegible)

    Deputy Registrar (Rules)

    for Registrar

    (II) Endst. No. 22686-90.Rules/DHC, dated 13-12-1995.

    Copy forwarded for information to:—

    (1) The Secretary (Law & Judicial), Govt. of National Capital Territory of Delhi, 5 Sham Nath Marg, Delhi.

    (2) The Distrct & Sessions Judge, Delhi.

    (3) President/Secretary, Supreme Court Bar Association, Supreme Court, New Delhi.

    (4) President/Secretary, Delhi High Court Bar Association, Delhi High Court, New Delhi.

    (5) President/Secretary, Bar Association. Tis Hazari Court/Patiala House Courts/Shahdara Courts/Karkardooma Courts, Delhi.

    Deputy Registrar (Rules)

    for Registrar

    (III) Endst. No. 2160.Rules/DHC, dated 1-2-1996.

    Copy forwarded for information and necessary action to Sh. Madan B. Lokur, Editor, I.L.R Room No. 461, 4th Floor, Lawyers Chamber, Delhi High Court, New Delhi.

    Superintendent (Rules)

    for Registrar.

    HIGH COURT OF DELHI: NEW DELHI

    NOTIFICATION

    No. 16.Rules

    Dated, February 2, 1996

    In exercise of the power conferred by sub-Section (10) of Section 11 of the Arbitration and Conciliation Ordinance, 1996 (hereinafter referred to as ‘Ordinance’), the Chief Justice of the High Court of Delhi, hereby makes the following Scheme:

    1. Short Title.—This Scheme may be called the Scheme for appointment of Arbitrators, 1996.

    2. Submission of request.—

    (i) The request under sub-section (4) or sub-section (5) or sub-section (6) of section 11 of the Ordinance shall be made in writing in the form prescribed in Appendix I and shall be accompanied by -

    (a) The Original arbitration agreement of a true copy thereof.

    (b) An affidavit supported by the relevant documents or true copies thereof to the effect that the condition to be specified under sub-section (4) or sub-section (5) or sub-section (6) of setcion 11 of the Ordinance, as the case may be, before making the request to the person designated by the Chief Justice, has been satisfied.

    (ii) The request referred to in sub-para 2(i) of this para shall be accompanied by as many copies of the request together with items (a) and (b) of sub-para 2(i), as the number of parties to the arbitration agreement or such number which the person designated in para 3 of the scheme may direct.

    (iii) In case the person making the request does not have the Original arbitration agreement or a copy thereof he shall file an affidavit giving relevant facts in that behalf and request that the opposite Party may be directed to produce the original or a copy thereof.

    3. Authority to deal with the request—

    (i) For the purpose of dealing with the request made under para 2, the Chief Justice hereby designates.

    (a) the Civil Judge where the value of the subject matter does not exceed Rs. 1 lakh.

    (b) the District Judge/Additional District Judge where the value of the subject matter does not exceed Rs. 5 lakhs; and

    (c) the Judge of the High Court exercising ordinary original civil jurisdiction, where the value of the subject matter exceeds Rs. 5 lakh.

    (ii) The requests falling under sub-para (a) of para 3 shall initially be placed before Senior Civil Judge for appropriate allotment; the requests falling under sub-para (b) of para 3 shall initially be placed before the District Judge for appropriate allotment; and the request made under sub-para (c) of para 3 shall initially be placed before the Judge-in-charge on the Original Side of the High Court for appropriate allotment.

    4. Seeking further information:—

    (i) The person designated under para 3 may seek such further information or clarification or documents, from the party making the request under this scheme, as he may deem fit.

    (ii) The party making the request shall file as many copies of the written information or clarification or copies of documents as may be required to be filed by the person designated in para 3 of this Scheme.

    5. Rejection of request.—Where the request made by any party under paragraph 2 is not in accordance with the provisions of this Scheme, the person designated in para 3 may reject the same.

    6. Notice to affected person.—Subject to the provisions of paragraph 5, the person designated in para 3 shall direct that a notice of the application be given to all the parties to the arbitration agreement and to such other person or persons as may seem to him likely to be affected by such request to show cause, within the time specified in the notice, as to why the appointment of the arbitrator (s) or the measures proposed to be taken should not be made or taken and such notice shall be accompanied by copies of all documents referred to in para 2 or, as the case may be, by the information or clarification, or copies of documents, if any, sought under paragraph 4.

    7. Intimation of action taken on request.—The appointment made or measures taken by the persons designated in para 3 in pursuance of the request under paragraph 2 shall be communicated in writing to —

    (a) the parties to the arbitration agreement;

    (b) the arbitrators, if any, already appointed by the parties to the arbitration agreement;

    (c) the person or institution if any to whom or to which any function has been entrusted by the parties to the arbitration agreement under the appointment procedure agreed upon by them.

    (d) the arbitrator appointed in pursuance of the request.

    8. Request and communications to be sent to Authorised Officer.— All request under the Scheme and communications relating thereto shall be presented to the Officer authorised by the persons designated in para 3 and the said Officer shall maintain a separate register of such requests and consumptions. Whenever requests under para 2 are received, the Authorised Officer shall, as soon as may be, place the same before the persons designated in para 3.

    9. Delivery and receipt of written communications.—The provisions of sub-section (1) and (2) of section 3 of the Ordinance shall, so far as may be, apply to all written communications received or sent under this Scheme.

    10. Costs for procostic requests.—The party, making a request under this Scheme shall, along with the request for arbitration pay an amount of Rs. 250/- in case the request is made to the person designated under para 3 (a) of this Scheme, Rs. 500/- in case the request is made to a person designated under para 3(b), and Rs. 1000/- in case the request is made to a person designated under para 3(c).

    11. Interpretation.—

    (i) If any question arises with reference to the interpretation of any of the provisions of this Scheme before a person designated under para 3(c) of this scheme, it shall be decided by that person.

    (ii) In case the question arises before the person designated under para 3 (a) and (b) of this Scheme, the said person shall formulate the question and refer the same for decision of the Chief Justice or a Judge of the High Court of Delhi designated by the Chief Justice.

    (iii) The decision by the person to whom the question is referred to as stated in para 11 (i) or (ii) shall be final.

    Power to amend the Scheme.—The Chief Justice may, from time to time amend, by way of addition or variation or deletion, any provision of this Scheme.

    NEW DELHI (M. JAGANNADHA RAO)

    Dated 29-1-1996, CHIEF JUSTICE

    HIGH COURT OF DELHI.

    APPENDIX I

    BEFORE ——————————————

    ARBITRATION APPLICATION NO............ OF 1996.

    1. Provision under which the application is filed. 2. Name(s) of the applicant(s) with complete address/(es) 3. Name(s) of the other parties to the arbitration agreement with complete addresses 4. Names and addresses of the arbitrators, if any, already appointed by parties. 5. Name and address of the person or institution, if any, to whom any function has been entrusted by the parties to the arbitration agreement under the appointment procedure agreed upon by them. 6. Qualification requires, if any, of the arbitrator by the agreement of the parties. 7. A brief written statement describing the general nature of the disputes and the points at issue. 8. Valuation of the subject matter. 9. Relief or the remedy sought. Signature of the Applicant. Date: Signature of the Advocate, if any.

    Endst. No. 2400-3.Rules/DHC, Dated 6-2-1996.

    Copy forwarded for information/necessary action to:—

    (1) P. A. to Registrar.

    (2) All Joint Registrars/Deputy Registrars/Assistant Registrars/Court Masters/Superintendents of Delhi High Court.

    (3) Librarian, Delhi High Court.

    (4) Notice Board, Delhi High Court.

    DEPUTY REGISTRAR (RULES)

    FOR REGISTRAR

    Endst. No. 2404-6.Rules/DHC Dated 6-2-96

    Copy forwarded for information to:—

    (1) The Secretary, Ministry of Law, Justice & Company Affairs, Deptt. of Justice, Govt. of India, Jaisalmer House, New Delhi.

    (2) The Secretary (Law & Judicial), Govt. of National Capital Territory of Delhi, 5, Sham Nath Marg, Delhi.

    (3) Secretary—Bar Association, Patiala House Courts/Shahdara Courts/Karkardooma Courts, Delhi.

    DEPUTY REGISTRAR (RULES)

    FOR REGISTRAR

    Endst. No. 2407.Rules]DHC Dated 6-2-96

    Copy forwarded for information and necessary action to Sh. Madan B. Lokur, Editor, I.L.R, Room No. 461, 4th Floor, Lawyers Chamber, Delhi High Court, New Delhi.

    DEPUTY REGISTRAR (RULES)

    FOR REGISTRAR

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