JUDGMENT
Prabha Shanker Mishra, J.
1. Jute Mill Mazdoor Sabha, Katihar through its President and 10 workmen have together moved this Court for an appropriate writ or direction for payment of wages to the workmen of the mill, Employees State Insurance dues and to save the mill from closure or going sick. In one of the affidavits they hare also said that they may be allowed to run the mill and they would do so if they are paid their dues.
2. The mill was established as a private limited company, which, it appears, got financial assistance from the Bihar State Financial Corporation. And failed to re-pay. Mill’s defaults attracted Section 29 of the State Financial Corporations Act, 1951 and on 27-9-1983 the Bihar State Financial Corporation (respondent No. 2) took over the management and possession of the mill. The mill remained thus transferred to the respondent No. 2 until on 11-12-1984 it was (sick) transferred under a lease to Bihar State Industrial Development Corporation-respondent No. 3. Respondent No. 3 agreed to pay the current salary and wages to employees of the mill. While the mill thus came under the direct management of the respondent No. 3 the Central Jute Wage Board revised the wage structure and it implemented the same paying to the employees their wages up to January, 1988 and the wages for the month of February, 1988 in May 1988. The mill, however, ran out of work due to lack of Jute and, it seems has remained without production since then.
3. It is admitted that the mill has not been declared closed; there is no retrenchment, no lockout and no other act to suspend the contract of service of the workmen. According to the petitioners, their original contract of service with the erstwhile private management (respondent No. 4) continued under the respondent No. 2 and the respondent No. 3, workmen accordingly, are entitled to their respective emoluments both arrears and current wages except for the period they have been paid. When they went without any salary for some months on 4-4-1988 they served a demand notice upon the respondent No. 3 and reiterated the demand by a notice served upon the respondent State of Bihar. Respondents were noticed before admission and after hearing learned Counsel for the petitioners and learned Counsel for the respondents on 11-7-1988 this application was admitted to hearing. When the case was listed for hearing before me on 15-3-1989 learned Counsel for the Bihar State Industrial Development Corporation (respondent No. 3) informed the Court that it had surrendered its lease to the Bihar State Financial Corporation and that, the respondent No. 2 had to answer the allegations of the petitioners. Respondent No. 2 on the other hand maintained that it was a financial institution and liabilities and responsibilities attached to the management of the mill were to be discharged by the Government of the State. Noticing, however, the predicament of the State Government of protecting the Interest of the mill and the employees on the one hand and meeting the financial commitments on the other hand and in view of the consensus emerging on the basis of a proposal advanced by the petitioners in the shape of a scheme I ordered as follows:
There may be one or the other condition in the said scheme which may not be acceptable to all the parties but this Court cannot ignore the fact that any failure on the part of the respondents to keep the mill in the running condition and continuing the services of the petitioners may result in serious consequences to both the management as well as the workmen. Before, however, any final decision is taken to give any direction to the respondents it is desirable that opportunity is given to the parties to arrive at an agreed scheme so that interests of the management on the one hand represented in one or the other respondents and the interests of the workmen on the other hand represented by the petitioners are not jeopardised. Accordingly, I hereby order that the respondents may consider the desirability of accepting the scheme furnished by the petitioners with or without modification or submit their own scheme which may be considered by all the parties at further hearing of the application.
On 4-5-1989 when the case was again listed for hearing learned Counsel for the parties informed that a high level meeting had taken place on the 11th April, 1989 in which issues as to how the mill could be reoriented was considered. It had transpired at the said meeting that the mill had to pay towards arrear salary and wages from March, 1988 till date around 11/4 crores (twenty lacs per month), that employees had not been paid their emoluments and they were going without any salary, wages or payment of any kind and that it would take some time for any person to implement any scheme and ensure financial security to the mill. On that day also in view of the attitude of the parties I ordered as follows:
Before finally disposing of the instant application, however, it is necessary to obtain a firm reply at to whether the respondent-State of Bihar and the respondents-Bihar State Financial Corporation and the Bihar State Industrial Development Corporation are willing to pay the arrear wages of the employees of the mill or not and if they are willing to pay, what may be the precise time taken by them to pay their employees their arrear wages. Accordingly, respondents 1 there directed to state categorically within two weeks from today whether they are willing to pay to the employees their arrear emoluments within a period of three months or not and whether until terminated in accordance with law they shall accordingly pay to the employees their current salary without any fail or not. Final order in this case shall be passed after obtaining firm reply on the above from the respondents concerned.
Court’s attempts to ensure introduction of a ‘scheme to arrest the situation and improve the lot of the mill and its employees, however, failed as no firm reply came from any of the respondents. Both respondents 2 and 3 have, however, joined in stating that they do not have such financial resources unless the State Government fulfilled its commitments and the deficit and arranged such finance which would be utilised in making the mill workable and to enter once again in production. Respondent No. 2 has, however, stated that transfer of employment of the workmen from the erstwhile private management was affected only after the respondent No. 3 got the lease on assurance from the State Government, that it would make necessary capital available to the respondent No. 3. Respondent No. 3 has stated that lease confined to the management and management only and the ownership remained with the respondent No. 2 and transfer of the management under the lease to it gave no right to it into the properties of the put it under any financial obligation or commitment except the fund made available to it by the State Government. Respondent No. 3 has, however, acknowledged its liability until it surrendered the lease to the respondent No. 2 but has not acknowledged any liability prior to its entering upon the management of the mill stating that any service rendered by workmen to erstwhile employers was of no consequence for the reason that on its entering upon the management it re-employed the workmen on such terms and conditions as were agreed upon including implementation of revised wage structure as awarded by the Central Wage Board.
4. Before entering into the question as to whether respondents are liable to pay to the workmen of the mill their arrear and current wages and, if liable, what is the extent and tenure of the liability, I may indicate that Section 25-B of the Industrial Disputes Act has defined continuous service to mean a workman shall be said to be in continuous service for a period if he is for the period in uninterrupted service, including service which may be interrupted on account of sickness or authorised leave or an accident of a strike which is not illegal, or a lockout or a cessation of work which is not due to any fault on the part of the workman. Section 25-F of the Industrial Disputes Sect has set forth conditions precedent to retrenchment of workmen Section 25-FF states:
Where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law, from the employer in relation to that undertaking to new employer, every workman who has been in continuous service for not less than one year in that undertaking immediately before such transfer shall be entitled to notice and compensation in accordance with the provisions of Section 25-F as if the workman had been retrenched:
Provided that nothing in this section shall apply to workman in any case where there has been a change of employers by person of transfer, if-
(a) the service of the workman has not been interrupted by such transfer;
(b) the terms and conditions of service applicable to the workman after such transfer are not in any way less favorable to the workman than those applicable to him immediately before the transfer ; and
(c) the new employer is under the terms of such transfer or otherwise legally liable to pay to the workman in the event of his retrenchment compensation on the basis that his service has been continuous and has not been interrupted by the transfer.
Respondents have not come forward with any case showing that workmen had been retrenched and that conditions precedent to retrenchment were followed in the case of the employees of the mill before any one of them took over the management of the mill. They have also not come forward with any case that any one of them served and notice and paid compensation to any of the workmen in accordance with the provisions of Section 25-F of the Industrial Disputes Act, It is not understandable how the respondents shall then be contending that they shall not be liable for arrears prior to the management coming under them. Section 29 of the State Financial Corporation Act has envisaged a statutory transfer of the management or possession or both of the industrial concern as well as the right to transfer by way of lease or sale and realise the property pledged, mortgaged, hypothecated or assigned to the Financial Corporation. By dint of the said statutory transfer workmen came under the management of the new owner, that is to say, the respondent No. 2 on 27-9-1983, It was open to the respondent No. 2 to pay compensation to them and get the industry free from the burden of the wages of the employees. Nothing of that sort was done. When respondent No. 3 entered upon the management it could take recourse to Section 25-FF read with Section 25-F and create fresh agreements or contracts of service, take new employees instead of old once but it agreed as stated in paragraph 7 of the writ application:
It is agreed that the employees of K. J. M. on their pay roll on the date of take over by BSFC shall be treated to be on the pay roll of M/s. Katihar Jute Mills Ltd., and they or such of them as may be employed afresh by the lessee in connection with the revival and operation of the plaint of K. J. M. shall be paid their current salaries and wages and other benefits to which they may be legitimately entitled to by the lessee.
It is on that basis, according to the petitioners, that they remained and continued to work under the respondent No. 3 receiving their due wages.
5. One of the directive principles of the State Policy in Article 43 of the Constitution of India states that the Stale shall endeavor to secure, by suitable legislation or economic organisation or in any other way, to all workers, agricultural, industrial or otherwise, work, a living wage, conditions of work ensuring a decent standard of life and full enjoyment of leisure and social and Cultural opportunities and, in particular, the State shall endeavor to promote cottage industries on an individual or co-operative basis in rural areas, The Minimum Wages Act has been introduced to prevent employment of sweated labour and prescribed minimum wage rates to ensure a living wage to all workers, power-loom industries like the mill who are covered by the Act, ensured that the employer pays to every employee wages at a rate not less than the minimum rate of wages for the class of employees without any deductions except as may be authorised within such time and such conditions as may be prescribed. This Act has not envisaged any exception to any Government undertaking or to instrumentalities and employments except in the event of notification incorporating the activities in the schedule of the Act. Article 21 of the Constitution of India guarantees that no person shall be deprived of his life or personal liberty except according to procedure established by law. Life as has been held is not an inert concept confined to a clinical life or death but embracing all activities that any free human being subject to the laws of the land may carry on. Article 23 of the Constitution states:
(1) Traffic in human beings and beggar and other similar forms of forced labour are prohibited and any contravention of this provision shall be an offence punishable in accordance with law.
In Peoples Union for Democratic Rights and Ors. v. Union of India and Ors. , it has been held: –
Then there is the complaint of nonobservance of the provisions of the Contract Labour (Regulation and Abolition) Act, 1970 and the Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979 and this is also in our opinion a complaint relating to violation of Article 21. This Article has acquired a new dimension as a result of the decision of this Court in Monika Gandhi v. Union of India and it has received its most expansive interpretation in Francis Coralline Mill-in v. The Administrator Union Territory of Delhi where it has been held by this Court that the right of life guaranteed under this Article is confined merely to physical existence or to the use of any faculty or limb through which life is enjoyed or the soul communicates with outsides work but it also includes within its scope and ambit the right to live with basic human dignity and the State cannot deprive any one of this precious and invaluable right because no procedure by which such deprivation may be affected can ever be regarded as reasonable, fair and just. Now the rights and benefits conferred on the workmen employed by a contractor under the provisions of the Contract Labour (Regulation and Abolition) Act, 1970 and the Inter-State Migrant Workmen (Regulation of Employment and Conditions of Service) Act, 1979 are clearly intended to ensure basic human dignity to the workmen and if the workmen are deprived of any of these rights and benefit to which they are entitled under the provisions of these two pieces of social welfare legislation, that would, clearly be a violation of Article 21 by the Union of India, the Delhi Administration and the Delhi Development Authority which as principal employers are made statutorily responsible for securing such rights and benefits to the workmen. That leaves for consideration the complaint in regard to non-payment of minimum wage to the workmen under the Minimum Wages Act, 1948. We are of the view that this complaint is also one relating to breach of a fundamental right and for reasons which we shall presently state, it is the fundamental right enshrined in Article 23 which is violated by non-payment of minimum wage to the workmen.
6. Articles 21 and 23 of the Constitution take care of the socio-economic structure of the country and bring about socio-economic re-generation with a view to reaching social and economic justice to the common man. As Article 21 is not confined merely to physical existence or to the use of any faculty or limb through which life is enjoyed or the soul communicates with outside would but it also includes its basic human dignity, is the sweep of Article 23 which is wide and unlimited and strikes at “traffic in human beings and beggar and other similar forms of forced labour” wherever they are found. People’s Union for Democratic Rights case has gone into some details of the reason for enacting this provision in the Chapter of fundamental rights and has posed the question-What is the true scope and moaning of the “traffic in human beings and beggar and other similar forms of forced labour,” in Article 23 ? What are the forms of “forced labour” prohibited by it and what kind of labour provided by a person can be regarded as ‘forced labour’ so as to fall within this prohibition. Supreme Court has rejected any stifling role of Article 23 of the Constitution and has said:
It is difficult to imagine that the Constitution-makers should have intended to strike only at certain forms of forced labour leaving it open to the socially or economically powerful sections of the community to exploit the poor and weaker sections by resorting to other forms of forced labour. Could there be any logic or reason in enacting that if a person is forced to give labour or service to another without receiving any remuneration at all, should be regarded as a pernicious practice sufficient to attract the condemnation of Article 23, but if some remuneration is paid for it, then it should be outside the inhibition of that Article? If this were the true interpretation, Article 23 would be reduced to a mere rope of sand, for it would then be the easiest thing in an exploitative society for a person belonging to a socially or economically dominant class to exact labour or service from a person belonging to the deprived and vulnerable section of the community by paying a negligible amount of remuneration and thus escape the rigor of Article 23. We do not think it would be right to place on the language of Article 23 an interpretation, which would emasculate its beneficent provisions and defeat the very purpose of enacting them. We are clearly of the view that Article 23 is intended to abolish every form of forced labour. The words “other similar forms; of forced labour” are used in Article 23 not with a view to importing the particular characteristic of “beggar’ that labour or service should be exacted without payment of any remuneration but with a view to bringing within the scope and ambit of that Article all other forms of forced labour and since ‘beggar’ is one form of forced labour, the Constitution-makers used the words “other similar forms of forced labour”. If the requirement that labour or work should be exacted without any remuneration were imported in other forms of forced labour, they would straightaway come within the meaning of the word ‘beggar’ and in that event there would be no need to have the additional words ‘other similar forms of forced labour. These words would be rendered futile and meaningless and it is a well-recognised rule of interpretation that the court should avoid a construction, which has the effect of rendering any words used by the legislature superfluous – of redundant. The object of adding these works was clearly to expand the reach and content of Article 23 by including in addition to ‘begar1 other forms of forced labour within the prohibition of that Article. Every form of forced labour, ‘beggar’ or otherwise, is within the inhibition of Article 23 and it makes no diligence whether the person who is forced to give his labour or service to another is remunerated or not. Even if remuneration is paid, labour supplied by a person would be hit by this Article if it is forced labour, that is labour supplied not willingly but as a result of force or compulsion.
Force or Compulsion has also fallen for consideration in the said case and the court has said:
It is obvious that ordinarily no one would willingly supply labour or service to another for less than the minimum wage, when he knows that under the law he is entitled to get minimum wage for the labour or service provided by him. It may therefore be legitimately presumed that when person provides labour or service to another against receipt of remuneration, which is less than the minimum wage, he is acting under the force of some compulsion, which drives him to work though he is paid less than what he is entitled under law to receive. What Article 23 prohibits is ‘forced labour’ that is labour or service which a person is forced to provide and force which would make such labour or service ‘forced labour’ may arise in several ways. It may be physical force which may compel a person to provide labour or service to another or it may be force exerted through a legal provision such as a provision for imprisonment or fine in case the employee fails to provide labour or service or it may even be compulsion arising from hunger and poverty, want and destitution. Any factor which deprives a person of a choice of alternatives and compels him to adopt one particular course of action may properly be regarded as ‘force’ it would be forced labour’ Where a person is suffering from hunger or starvation, when he has no resources at all to fight disease or to feed his wife and children or even to be their nakedness, where utter grinding poverty has broken his back and reduced him to a state of helplessness and despair and where no other employment is available to alleviate the rigour of his poverty, he would have no choice but to accept any work that comes his way, even if the remuneration offered to him is less than the minimum wage.
This study, however, shall be incomplete if at this stage Article 14 of the Constitution is also not taken notice of. Equal protection of Saw and equality before law when extended to practice, strike at every arbitrary, discriminatory and fanciful on slaught. Its reach is such that it converts Article 43 of the Constitution, though in Part IV appear to be a fundamental right. In Purina Zila Mazdoor Union through its Secretary v. The State of Bihar and Ors. 1989 PLJR 493 after quoting Article 43 of the Constitution a Bench of this Court, of which I was a member, has said –
The said provision although occurs in Part IV of the Constitution but when read in conjunction with Articles 14, 21 and 23 of the Constitution, the same must be held to be one of the fundamental rights of a citizen of India.
Respondents except respondent No. 4 who are all States under Article 12 of the Constitution of India can not justify their existence unless they endeavor to secure suitable legislation or economic organization or in any other way, to all workers agricultural, industrial or otherwise, work, a living wage, conditions of work ensuring a decent standard of life and full enjoyment of leisure and social and cultural opportunities and, in particular, endeavor to cottage industries on an individual or co-operative basis in rural areas.
7. The case in hand, however, does not require examination of the provisions of the Minimum Wages Act. It also does not invite application of laws that govern the workman or the employer employee relationship beyond what has already been noticed. The reason is obvious. That petitioners are workmen are not in dispute; that erstwhile management of respondent No. 4 lost its control and ownership by the application of Section 29 of the Financial Corporation Act, is undisputed. That respondent No. 3 was given the management and control of the affairs of the undertaking of the respondents 2 and 4 by an agreement between respondent No. 2 and the respondent No. 3 is the common case. That respondent No. 1 participated in the negotiations and controls the activities of the respondent No. 3 is not in doubt. Respondent No. 3 is an instrumentality of the State of Bihar. Respondent No. 2 though a creature under the State Financial Corporation Act, is subject to the Financial Control of the State Government. Rights under Articles 21 and 23 are such that they can be enforced against my person even against a person who is not a State or an authority equivalent to a State. In the instant case, however, petitioners have sought their enforcement against respondents 1 to 3 who are States or authorities equivalent to State. Before I proceed to touch the core of the problem I may remind that the ends of justice are higher than the ends of mere law though justice has got to be administered according to the laws made by the Legislature (See State of Karnataka v. Muniswami and Ors. ); and the law is meant to serve the living and does not beat its abstract wings in the rural void. Its functional fulfillment as ‘social engineering’ depends on its scrutinized response to situation; subject matter and the complex of realities which require ordered control. A holistic understanding is simple justice to the meaning of all legislations. Fragmentary grasp of rules can misfire or even backfire,” (See Chairman, Board of Mining Examination and Anr. v. Ramjee ). Respondents committed no fault by joining the service under respondent No. 4. They played no role when respondent No. 4 defaulted in honoring the agreement with respondent No. 2 and Section 29 of the State Financial Corporation Act statutorily transferred the management and the properties of the employer company (respondent No. 4) to the respondent No. 2. They again were nowhere when respondents 1 to 3 decided to create a lease and* bring upon the management all the affairs of the employer company the respondent No. 3 ; Employers changed. Their fate, however, remained as it was of workmen engaged by the respondent No. 4 and re-employed by the respondent No. 3. If there was any change, it was a ray of hope of receiving wages as the private ownership, had changed into State ownership. They did get emoluments for some period but they again had to sink as low as they were under the private employer, the respondent No. 4. If there is one basic law which must govern every contract of service, that is, “that employer must pay living wages to the employee”, if wages are paid but are less than minimum prescribed wages it is a form of forced labour. If no wages are paid, it is beggar. So long the relationship of employer and employee is not determined in accordance with law the obligation to pay wages alone shall ensure that Article 23 of the Constitution is’ not violated. In the case of petitioners since they have alleged and not been denied their living condition has deteriorated on account of the employer not paying to them their wages, not discharging his obligations for their health care and not contributing to employees State Insurance. Respondents 1 to 3 have, in so far as the petitioners are concerned, failed to make any endeavor to secure to the petitioners work, a living wage and conditions of work ensuring decent standard of life and full enjoyment of leisure and social and cultural opportunities. They have by not doing so violated Articles 43 and 21 of the Constitution of India.
8. Petitioners had shown eagerness to participate in the management and prepared a scheme. A copy of the scheme was served to each of the respondents and, as averred, they met and discussed. Why then they hesitated in accepting the offer of the workers that they would manage the affairs of the company is not understandable. 42nd amendment of the Constitution has introduced Article 43-A in Part IV thereof stating that the State shall take steps by suitable legislation or in any other way to secure the participation of workers in the management of undertakings establishments or other organisations engaged in any industry. They would have saved the company and their name on the one hand and given to the workers a right so cherished as noticed in Article 43-A of the Constitution.
9. The case in hand is not for ditribesor ramblings. It is wise to exercise refrain and avoid comments. Yet, courts of India have not hesitated in frankly stating their views when they have noticed violation as glaring as in the instant case. Respondents 1 to 3 have shown no will to implement the basics although they have all the resources. Both respondents 2 and 3 have pleaded that they do not have sufficient finance to meet the arrears of wages or to pay current wages to the employees. They have apparently suggested that the respondent-State has to provide to them necessary funds and if such funds are made available to them they would invest such amount needed to cover the wages in arrears and current. It seems, however, that both respondents 2 and 3 have failed to realise that their mobilising resource is their look out, employees have nothing to do. They shall have their claims against their employer. They shall be entitled to force their claims against them. Yet, the instant case is one in which the respondent- State of Bihar cannot be just a creditor advancing many either to the Financial Corporation respondent No. 2 or to Industrial Development Corporation-respondent No. 3. Respondent No. 3 is nothing but an extension of the activities of the State of Bihar. Liabilities of the respondent No. 3 are liabilities of the State of Bihar. Primary source of Financial Corporation’s wealth is the State of Bihar or other statutory institutions including banking institutions. I am informed at the Bar that the State of Bihar guarantees all liabilities created through the bonds floated by the Financial Corporation. Be that as it may, a piquant situation has been created, it appears on account of the respondent No. 2 creating a lease holding interest of the respondent No. 3 in the properties of the company and the State of Bihar agreeing to meet the financial commitments of the respondent No. 3, which commitment, according to the respondent No. 3 was not fulfilled by it, resulting in lapses and failures to pay the wages. A further complication has been created by the respondent No. 3 during the pendency of the instant application surrendering the lease to the respondent No. 2, according to the respondent No. 3, at the instance of the respondent-State. All these maneuverings aside, a further complication, it appears, has arisen on account, of the erstwhile private management of the company going in liquidation and I am informed some such proceeding is pending in the Calcutta High Court. All that has been happening, however, has not been to help out the employees but to put some sort of impediment in the management of the affairs of the company. In all these, however, one fact remains intact that whatever may be the distribution of the liability between the respondents 1, 2 and 3, whatever may be the period for which one may be responsible and the other may not be they are together liable for the arrears and current wages of the workers of the company until their contract of service is determined. 1 have generally spoken about the arrears in my earlier discussions, but petitioners have in their application claimed wages since February, 1988 and Employees State Insurance (E. S. I.) contributions since not paid by the respondents 1 to 3.
10. I have given my anxious considerations to the two competing interests, namely, (i) to ensure that the industry is saved and if possible, reoriented and (ii) workmen are paid their wages both arrears and current. The only course to conclude this proceeding, according to me, is to direct respondents 1 to 3 to pay to the workmen their salary pending from March, 1988 up to date within a reasonable time and current salary in accordance with law until their employment continues. This can be achieved by a scheme, which shall ensure payment of entire arrear from March, 1988 up to date within a period of two years and current salary each month beginning from the month of October, 1989. To conclude, therefore, respondents 1 to 3 may pay to the workmen arrears in such equal installments that they cover entire arrear within a period of two years beginning from October, 1989 and besides pay current wages each month without fail beginning from October, 1989. Similarly they may make up the arrears in State Insurance within a period of two years, but begin current contributions each month as required by law in this behalf with effect from October, 1989.
11. In the result, this application is allowed. Let a writ in the nature of mandamus issue in the terms aforementioned. Respondents shall pay to the petitioner a sum of Rs. 3000 (three thousand) consolidated towards cost of this litigation.