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Air India v. Union Of India And Others
Factual and Procedural Background
Air India, constituted under the Air Corporations Act, 1953, framed the Air India Employees' Service Regulations, 1963 pursuant to Section 45 of that Act. In 1982 the Deputy Chief Labour Commissioner (Delhi) initiated proceedings under the Industrial Employment (Standing Orders) Act, 1946 to certify Standing Orders for Air India. The corporation contended that the Standing Orders Act was inapplicable because its employees were already governed by the 1963 Regulations. The contention was rejected by the certifying authority and on appeal. Air India then filed a writ petition before the Delhi High Court, which ruled that the Standing Orders Act, being a special statute, applied to Air India’s employees. The present appeal before the Supreme Court challenges that High Court judgment.
While the litigation was pending, the Air Corporations (Transfer of Undertakings and Repeal) Act, 1994 (“1994 Act”) came into force on 29 January 1994, repealing the 1953 Act. This statutory change became central to the parties’ positions before the Supreme Court.
Legal Issues Presented
- Whether the Air India Employees' Service Regulations, 1963, framed under the repealed Air Corporations Act, 1953, survived after the commencement of the Air Corporations (Transfer of Undertakings and Repeal) Act, 1994.
- If the Regulations did not survive, whether Air India could still resist the certification of Standing Orders under the Industrial Employment (Standing Orders) Act, 1946.
Arguments of the Parties
Appellant – Air India
- Mr. F. S. Nariman, Senior Counsel, contended that Section 8 of the 1994 Act expressly preserves existing “remuneration, terms and conditions, rights and privileges” of employees and therefore implicitly saves the 1963 Regulations.
- On that footing, Air India maintained that its employees continued to be governed by the Regulations, rendering certification under the Standing Orders Act unnecessary.
Respondent – Employees of Air India
- Ms. Indira Jaising argued that the repeal of the 1953 Act eradicated the statutory foundation of the 1963 Regulations; without an explicit saving clause identifying those Regulations, they lapsed on 29 January 1994.
- Consequently, Air India lacked any statutory shield against the application of the Standing Orders Act.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Watson v. Winch (1916) 1 KB 688; (1916-17) All ER Rep 972 | On repeal of a statute, subordinate legislation (e.g., bye-laws) made under it ceases to have effect unless the repealing Act explicitly preserves it. | The Court adopted this principle to hold that the 1963 Regulations could survive repeal only if the 1994 Act expressly saved them. |
Court's Reasoning and Analysis
The Supreme Court emphasised that subordinate legislation endures after repeal of its parent statute only when the new statute expressly preserves it, ideally by name. Referring to Watson v. Winch and scholarly commentary in Bennion on Statutory Interpretation, the Court reasoned that:
- A “saving” provision must be clear and specific; implications or general language are insufficient.
- Section 8 of the 1994 Act merely guarantees continuity of individual employees’ service conditions for a transitional six-month period and does not mention, still less preserve, the 1963 Regulations.
- The limited protection in Section 8 (“to quieten doubts”) applies only to employees in service on the appointed day and cannot be stretched to validate the Regulations for all time.
Because the Regulations lost statutory force on 29 January 1994, the cornerstone of Air India’s resistance to the Standing Orders Act disappeared. With that question resolved, the Court found it unnecessary to examine any remaining submissions.
Holding and Implications
Appeal Dismissed with Costs.
Immediate Effect: The 1963 Service Regulations are inoperative, and Air India cannot rely on them to avoid certification under the Industrial Employment (Standing Orders) Act, 1946. Broader Impact: The judgment reinforces the principle that subordinate legislation does not survive repeal absent an explicit statutory saving, but it sets no new precedent beyond affirming settled interpretive doctrine.
S.P Bharucha, J.— Special leave granted.
2. The appeal impugns a judgment of the Delhi High Court. The appellant is Air India.
3. Air India was established under the Air Corporations Act, 1953. Under the provisions of Section 45 thereof, the Air India Employees' Service Regulations, 1963, were framed with the consent of the Central Government. The said Regulations governed the terms and conditions of service of Air India's employees. In or about the year 1982 the Deputy Chief Labour Commissioner, Delhi, initiated proceedings against Air India under the provisions of the Industrial Employment (Standing Orders) Act, 1946, for certification of Standing Orders. Air India contended that the Standing Orders Act did not apply to it. The contention was rejected and Standing Orders were certified. Air India's appeal was rejected. Air India then filed the writ petition upon which the order under appeal was passed. The High Court held that the Standing Orders Act was a special Act and applied to Air India's employees.
4. The Air Corporations (Transfer of Undertakings and Repeal) Act, 1994 came into force on 29-1-1994. By reason of Section 11 thereof the Air Corporations Act, 1953, stands repealed from that day. Based upon this, Ms Jaising, appearing for Air India's employees, has raised a contention that goes to the root. Air India's case had been that its employees' terms and conditions of service were governed by the said Regulations framed under Section 45 of the Air Corporations Act, 1953, that Act having now been repealed, the said Regulations no longer survived and the sheet-anchor of Air India's bid to avert certification of Standing Orders under the Standing Orders Act disappeared.
5. Mr F.S Nariman, learned Senior Counsel for Air India, submitted that the said Regulations were saved by Section 8 of the 1994 Act which reads thus:
“8. Provisions in respect of officers and other employees of corporations.— (1) Every officer or other employee of a corporation (except a Director of the Board, Chairman, Managing Director or any other person entitled to manage the whole or a substantial part of the business and affairs of the corporation) serving in its employment immediately before the appointed day shall, insofar as such officer or other employee is employed in connection with the undertaking which has vested in a company by virtue of this Act, become, as from the appointed day, an officer or other employee, as the case may be, of the company in which the undertaking has vested and shall hold his office or service therein by the same tenure, at the same remuneration, upon the same terms and conditions, with the same obligations and with the same rights and privileges as to leave, passage, insurance, superannuation scheme, provident fund, other funds, retirement, pension, gratuity and other benefits as he would have held under that corporation if its undertaking had not vested in the company and shall continue to do so as an officer or other employee, as the case may be, of the company or until the expiry of a period of six months from the appointed day if such officer or other employee opts not to be the officer or other employee of the company, within such period.
(2) Where an officer or other employee of a corporation opts under sub-section (1) not to be in the employment or service of the company in which the undertaking of that corporation has vested, such officer or other employee shall be deemed to have resigned.
(3) Notwithstanding anything contained in the Industrial Disputes Act, 1947 (14 of 1947) or in any other law for the time being in force, the transfer of the services of any officer or other employee of a corporation to a company shall not entitle such officer or other employee to any compensation under this Act or under any other law for the time being in force and no such claim shall be entertained by any court, tribunal or other authority.
(4) The officers and other employees who have retired before the appointed day from the service of a corporation and are entitled to any benefits, rights or privileges shall be entitled to receive the same benefits, rights or privileges from the company in which the undertaking of that corporation has vested.
(5) The trusts of the Provident Fund or Pilots Group Insurance and Superannuation Scheme of the corporation and any other bodies created for the welfare of officers or employees would continue to discharge their functions in the company as was being done hitherto in the corporation. Tax exemption granted to Provident Fund or Pilots Group Insurance and Superannuation Scheme would continue to be applied to the company.
(6) Notwithstanding anything contained in this Act or in the Companies Act, 1956 (1 of 1956) or in any other law for the time being in force or in the regulations of a corporation, no Director of the Board, Chairman, Managing Director or any other person entitled to manage the whole or a substantial part of the business and affairs of that corporation shall be entitled to any compensation against that corporation or against the company, as the case may be, for the loss of office or for the premature termination of any contract of management entered into by him with that corporation.
6. In Watson v. Winch (1916) 1 KB 688, (1916-17) All ER Rep 972, Lord Reading, C.J, said:
“It would follow that any bye-law made under a repealed statute ceases to have any validity unless the repealing Act contains some provision preserving the validity of the bye-law notwithstanding the repeal.”
Sankey, J., concurring, said:
“When a statute is repealed any bye-law made thereunder ceases to be operative unless there is a saving clause in the new statute preserving the old bye-law. There appear to be two reasons for this: … Secondly, because the usual practice is to insert in the later statute a section expressly preserving previously made bye-laws if it is intended that they shall remain in force.”
(emphasis supplied)
7. Bennion on Statutory Interpretation, 2nd Edn., at pp. 494 and 495 states that a “saving is a provision the intention of which is to narrow the effect of the enactment to which it refers so as to preserve some existing legal rule or right from its operation”. It adds, “Very often a saving is unnecessary, but is put in ex abundanti cautela to quieten doubts.” The updated text of the Interpretation Act, 1978, (set out in Bennion's book at p. 897) puts into statutory form in Section 15 what is otherwise recognised in law, namely, that the repeal of an enactment does not, unless the contrary intention appears, affect any right or privilege accrued under that enactment.
8. In our view, if subordinate legislation is to survive the repeal of its parent statute, the repealing statute must say so in so many words and by mentioning the title of the subordinate legislation. We do not think that there is room for implying anything in this behalf.
9. Section 8 of the 1994 Act does not in express terms save the said Regulations, nor does it mention them. Section 8 only protects the remuneration, terms and conditions and rights and privileges of those who were in Air India's employment when the 1994 Act came into force. Such saving is undoubtedly “to quieten doubts” of those Air India employees who were then in service. What is enacted in Section 8 does not cover those employees who joined Air India's service after the 1994 Act came into force. The limited saving enacted in Section 8 does not, in our opinion, extend to the said Regulations.
10. Holding as we do that the said Regulations ceased to be effective on 29-1-1994, the very foundation of Air India's case no longer exists. No consideration of other arguments is, therefore, necessary.
11. The appeal, accordingly, fails and is dismissed with costs.
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