UNION OF INDIA ETC. versus THE UNITED PLANTERS ASSOCIATION OF SOUTHERN INDIA ETC. & ORS. on 11 July 2022

1. By way of these petitions under Article 139A(1) read withOrder XL of the Supreme Court Rules, 2013, the petitioners, led by theUnion of India, have prayed for transfer of various writ petitions, pendingbefore different High Courts challenging the constitutional validity of thePayment of Bonus (Amendment) Act, 2015 [being Act No. 6 of 2016][1],to this Court.

2. As per the record, though the first set of transfer petitions inthis batch, being T.P.(C) Nos. 884-895 of 2016, was entertained on01.07.2016 by issuing notices but, in the next set of petitions, being T.P.(C)Nos. 1456-1461 of 2016, while issuing notices on 26.09.2016, furtherproceedings in the related writ petitions pending before the AllahabadHigh Court were stayed. Thereafter, from time to time and until06.08.2018, other transfer petitions comprising this batch were entertainedand similar interim orders were passed, staying further proceedings inthe writ petitions pending before the respective High Courts. In the nexttwo matters, being T.P.(C) No. 1954 of 2018 and T.P.(C) No. 218 of2019, notices were issued respectively on 26.11.2018 and 08.02.2019but without any specific stay order. Thereafter, on 08.04.2019, T.P.(C)No. 683 of 2019 was entertained and while issuing notices, again, furtherproceedings in the subject writ petition before the High Court concernedwere stayed.

3. It may be noticed that in T.P.(C) Nos. 1490-1491 of 2016, therespondent No. 1 Tata Motors Ltd. has stated no objection to the transferof its case to this Court, being W.P.(C) Nos. 11112-13 of 2016 pending 1 Hereinafter also referred to as ‘the Amendment Act of 2015’.

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Abefore the High Court of Karnataka. Similarly, in T.P.(C) Nos. 590-598of 2017, one of the respondents, the State of Madhya Pradesh, has statedno objection if the subject writ petition pending before the High Court ofMadhya Pradesh is transferred to this Court. Similar has been the standof the State of Madhya Pradesh in T.P.(C) Nos. 760-789 of 2017 and ofthe State of Bihar in T.P.(C) No. 856 of 2018. The State of HimachalBPradesh has also not stated any specific objection in relation to the prayerfor transfer in T.P.(C) No. 1237 of 2018. Similarly, the respondent Nos.1 and 2 in T.P.(C) Nos. 885-886 of 2016, being Karnataka EmployersAssociation and Sai Security Printers Pvt. Ltd., have also stated noobjection if W.P.(C) No. 5311 of 2016 pending before the High Court ofCKarnataka is transferred to this Court. However, several of the otherrespondents in this batch of matters have strongly opposed the prayerfor transfer of the respective writ petitions to this Court on variousgrounds, as shall be noticed a little later.

4. Shorn of unnecessary details, the aspects relevant for the presentDpurpose are as follows:

4.1. By the said Amendment Act of 2015, two major changeswere introduced to the Payment of Bonus Act, 1965[2]: one being theamendment of clause (13) of Section 2, raising the salary limit fromRs. 10,000/- to Rs. 21,000/- per month for the purpose of coverageEunder the Act; and the other being raising the wage ceiling for calculatingthe bonus under Section 12 from Rs. 3,500/- to Rs. 7,000/- per month orthe minimum wages for the scheduled employment as fixed by theappropriate Government, whichever be the higher. Further, by way ofExplanation to Section 12, it was clarified that the expression “scheduledFemployment” shall have the same meaning as assigned to it in clause (g)of Section 2 of the Minimum Wages Act, 1948. These amendmentswere given retrospective effect in Section 1 of the Amendment Act of2015 by providing that it shall be deemed to have come into force on01.04.2014.G4.2. The said amended provisions, i.e., clause (13) of Section 2 asalso Section 12 of the Act of 1965, with necessary explanatory notes,are extracted as under: - H2 Hereinafter also referred to as ‘the Act of 1965’ or simply as ‘the Act’.

“2. Definitions. – In this Act, unless the context otherwiserequires,- ***

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(13) “employee” means any person (other than an apprentice)employed on a salary or wage not exceeding [twenty-one thousandrupees][3] per mensem in any industry to do any skilled or unskilledmanual, supervisory, managerial, administrative, technical orclerical work for hire or reward, whether the terms of employmentbe express or implied;”

“12. Calculation of bonus with respect to certainemployees.—Where the salary or wage of an employee exceeds[seven thousand rupees or the minimum wage for the scheduledemployment, as fixed by the appropriate Government, whicheveris higher][4] per mensem, the bonus payable to such employee undersection 10 or, as the case may be, under section 11, shall becalculated as if his salary or wage were [seven thousand rupeesor the minimum wage for the scheduled employment, as fixed bythe appropriate Government, whichever is higher][5] per mensem.

[Explanation. —For the purposes of this section, the expression“scheduled employment” shall have the same meaning as assignedto it in clause (g) of section 2 of the Minimum Wages Act, 1948.][6]"

4.3. The said amendments have been challenged in various writpetitions pending before different High Courts mainly on two counts:first, against the requirement of payment of bonus as per the amendedprovisions with retrospective effect from the year 2014-15; and secondly,against the validity of linkage to the minimum wages in regard to thecalculation of bonus.

4.4. As per the facts projected before us, the petitions filed invarious High Courts in challenge to the aforesaid Amendment Act of2015 have been entertained with different interim orders in some of thepetitions inasmuch as some of the High Courts have directed that theamendment shall take effect only from the financial year 2015-16

3 Substituted for “ten thousand rupees” by Act 6 of 2016, S. 2 (w.r.e.f. 01.04.2014).

4 Substituted for “three thousand and five hundred rupees” by Act 6 of 2016, S. 3(i)(w.r.e.f. 01-04-2014).

5 Same as footnote 4 ibid.

6 Inserted by Act 6 of 2016, S. 3(ii) (w.r.e.f. 01-04-2014).

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Awhereas one High Court has directed to implement the same from thefinancial year 2016-17. Another High Court has directed that no coerciveaction shall be taken against the writ petitioners.

4.5. As noticed, in the wake of challenge to the Amendment Actof 2015 in different High Courts; and the respective High Courts havingBpassed different interim orders, the petitioners led by the Union of Indiaseek transfer of all the pending writ petitions to this Court. Some of therespondents in these petitions have filed their reply, either opposing orsupporting these petitions, as per their respective stands.

5. Learned counsel for the parties have also filed their respectiveCwritten submissions and the learned Additional Solicitor General has, interms of our order dated 22.11.2021, filed a composite conveniencecompilation of the respective submissions, projecting divergent viewpoints.

5.1. We have heard Mr. K.M. Nataraj, learned Additional SolicitorGeneral for the petitioners; and Mr. Abhijit Chatterjee, Mr. K. Kasturi,DMs. Suruchii Aggarwal and Mr. Gopal Sankaranarayanan, learned seniorcounsel as also Mr. Rajiv Tyagi and Mr. R. Anand Padmanabhan, learnedcounsel for the respective respondents at length.

5.2. Having regard to the short question before us in this batch oftransfer petitions, it does not appear necessary to expand or elongateEthis order with reference to a wide variety of submissions made beforeus; suffice it would be to take note of the principal and material submissionsin support of the prayer for transfer of the writ petitions to this Court, orin opposition thereto, or in support of the alternative proposition oftransferring the writ petitions to one High Court.

F6. Mr. K.M. Nataraj, the learned ASG has pointed out that thesaid issues, relating to the retrospective operation of the amendedprovisions and linkage of calculation of bonus with minimum wages forthe scheduled employment, are forming the subject-matter of more than140 writ petitions filed across the country in as many as 18 High Courts.The learned ASG would submit that with large number of petitions involvingGsimilar and akin issues being taken up in different High Courts, there isevery likelihood of conflicting views being expressed by different HighCourts, which may lead to an undesirable situation. In the givencircumstances, according to the learned ASG, withdrawing all such writpetitions to this Court for analogous hearing would be in the best interestof the parties as also for maintaining consistency in operation of theH

statute. As regards a line of submissions by some of the parties that, if atall, the matters may be transferred to one High Court, the learned ASGhas submitted that such a course may not serve the best interest of theparties; and would cause hardship to the parties whose petitions arepending before other High Courts and who may not be able to effectivelycontest the matter before any High Court other than their jurisdictionalHigh Court.

7. Per contra, the learned senior counsel Mr. Abhijit Chatterjeeappearing for contesting respondents, including in T.P.(C) No. 786 of2017, has submitted that if the contention regarding the possibility ofconflicting decisions by different High Courts is accepted, it wouldpractically mean that every challenge to the validity of a central statuteshall have to be decided by this Court, which is not the mandate andframework of the constitutional scheme. According to the learnedcounsel, mere possibility of divergence of views or interpretations cannotbe a ground for transfer of all the proceedings to this Court. The learnedcounsel has strongly relied upon a 3-Judge Bench decision of this Courtin the case of Union of India v. M/s Cummins Technologies IndiaPvt. Ltd. & Ors. Etc.: Transfer Petition (Civil) Nos. 1481-1482 of2021, decided on 20.09.2021, to submit that in the said case, theprayer for transfer was declined by this Court even though it was arguedon behalf of the petitioner-Union of India that the same issue pending invarious High Courts was having implications on a large number of mattersand also ramifications of huge amount payable under a central statute.

7.1. It has also been submitted that the Union of India, having ahuge establishment of its law officers and legal advisors will not faceany difficulty in conducting the writ petitions in different High Courtswhereas transfer of writ petitions to this Court may cause difficulties tovarious litigants located at different places.

7.2. The learned senior counsel has also argued that the propositionof consolidation of all the writ petitions before one High Court alsodeserves not to be accepted because no one High Court would beconvenient to the writ petitioners who have filed their respective petitionsin their jurisdictional High Courts. The learned counsel, however, submittedin the alternative that if at all the petitions are to be consolidated beforeone High Court, the same may be transferred for analogous hearingbefore the Calcutta High Court, where the related writ petitions havealready appeared in the cause list for hearing and disposal. The learned A

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Acounsel has referred to the case of Institute of Chartered Accountantsof India v. Southern Petrochemical Industries Corporation Limitedand Anr.: (2007) 15 SCC 649 wherein this Court adopted the courseof transferring various writ petitions pending before different High Courts,and involving similar issues relating to the constitutional validity of Para33 of Accounting Standards 22 framed by the Institute of CharteredBAccountants of India, to the Calcutta High Court, where the petitionswere ready for hearing.

8. Ms. Suruchii Aggarwal, the learned senior counsel appearingfor the contesting respondents in T.P.(C) No. 1954 of 2018 has similarlyopposed the prayer for transfer with the additional submission that in theCevent of transfer of matters to this Court, the parties will lose their rightof appeal against the final judgment of the High Court. Apart from thedecision in M/s Cummins Technologies India Pvt. Ltd. (supra), thelearned counsel has also referred to the decision of this Court in LunawatConstruction Company v. Union of India & Anr.: (2019) 5 SCCD467.

9. Yet further, similar nature submissions have been made by Mr.Gopal Sankaranarayanan, the learned senior counsel for the respondentNos. 1 and 3, being Bowreah Jute Mills Private Limited and Indian JuteMills Association in T.P.(C) No. 892 of 2016. It has additionally beenEsubmitted that the issues being adjudicated by the Calcutta High Courtin the petition filed by them are not merely confined to the broader issuesmentioned in the transfer petitions but there are other factual issues,specific and unique to their case, which cannot be clubbed together withany other case. Further detailed submissions have been made as regardsthe status of these contesting respondents and the operation of law asFregards the jute industry; and the impact of impugned amendments onthis industry has also been highlighted which need not be dilated in thisorder. However, the emphasis in these submissions had been that thewrit petition of these respondents, being of its own peculiar nature,deserves not to be transferred.G

10. As indicated hereinbefore, more or less similar submissionshave been made by the learned senior counsel Mr. K. Kasturi as also bythe other learned counsel for the respondents, which are not beingrepeated for the sake of brevity. We may, however, take note of anadditional viewpoint projected by Mr. Rajiv Tyagi, learned counsel forHthe contesting respondent in T.P.(C) No. 683 of 2019 that with the linkage of qualifying wages to minimum wages in terms of the amendedSection 12, the wages prescribed by different States shall have differentimplications and in this view of the matter too, it would be appropriate ifthe pending writ petitions are considered by the respective High Courtsin light of the particular provisions operating in each State relating tominimum wages rather than bringing all such cases before this Court asa Court of first instance.

11. Having given thoughtful consideration to the rival submissionsand having examined the record, even when we agree with thesubmissions that the writ petitions related with this batch of mattersmight carry substantially the same questions of law concerning theconstitutional validity of the Payment of Bonus (Amendment) Act, 2015but, for a variety of other relevant reasons, we are disinclined to transferthese matters in this Court or even to one High Court.

12. In the first place, we feel that in the scheme of the Act of1965 and in relation to the questioned amendments, variance in some ofthe questions and some of the factual aspects is likely to occur becauseof the innate role of the appropriate Government in the ultimate calculationof bonus with respect to certain employees in terms of the amendedSection 12 of the Act of 1965; and such an appropriate Governmentmay be the Central Government or may be the Government of theparticular State in terms of the definition contained in clause (5) of Section2 of the Act of 1965 that reads as under:- “(5) “appropriate Government” means—

(i) in relation to an establishment in respect of which theappropriate Government under the Industrial Disputes Act,1947 (14 of 1947), is the Central Government, the CentralGovernment;

(ii) in relation to any other establishment, the Government ofthe State in which that other establishment is situate;”

12.1. Thus, when the wage ceiling in terms of the amended Section12 has its correlation also with the minimum wages for the scheduledemployment as fixed by the appropriate Government, the decision onthe questions being raised in the respective writ petitions, may have tobe addressed with reference to the relevant decision of the appropriateGovernment, depending on the nature of establishment; and that mayinclude the particular State Government too.

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12.2. Moreover, the role of the appropriate Government even asregards the power of exemption is seen in Section 36 of the Act of 1965and in this view of the matter too, in our view, the decision of individualwrit petitions by the jurisdictional High Courts shall be in the best interestof the respective parties. Section 36 of the Act of 1965 reads as under:- A

B“36. Power of exemption. – If the appropriate Government,having regard to the financial position and other relevantcircumstances of any establishment or class of establishments, isof opinion that it will not be in public interest to apply all or any ofthe provisions of this Act thereto, it may, by notification in theOfficial Gazette, exempt for such period as may be specified thereinCand subject to such conditions as it may think fit to impose, suchestablishment or class of establishments from all or any of theprovisions of this Act.”

13. Apart from the above, having regard to the subject-matterand the variety of questions likely to arise in the matter, it does appearDappropriate to have the benefit of the views of the jurisdictional HighCourts before the questions of law are taken up for consideration in thisCourt, if occasion so arises; and such a course appears better servingthe cause of justice, including protecting the right of seeking judicialreview after the decision of the Court of first instance.

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13.1. In Lunawat Construction Company (supra), this Courtconsidered it proper to have the benefit of findings of the High Court inrelation to the subject-matter and hence, conversely sent the writ petitionspending in this Court to the High Court with other transferred caseswhile observing as under:- F

“By filing Writ Petition (C) No. 96 of 2011 under Article 32 ofthe Constitution of India, the petitioner therein has challenged theconstitutional validity of the Ancient Monuments andArchaeological Sites and Remains (Amendment and Validation)Act, 2010 (Annexure P-15). In connected writ petition and theGtransferred case, the petitioners have claimed similar reliefs, whichare claimed in the lead Writ Petition No. 96 of 2011.

2. Having heard the learned counsel for the parties and onperusal of the record of the case, we deem it just and proper tosend these writ petitions and the transferred case to the HighCourt of Bombay for their disposal on merits in accordance withHlaw.

3. In our view, no prejudice is likely to cause to the parties, ifthese writ petitions and the transferred case are sent to the HighCourt for their hearing on merits of the controversy instead ofdeciding the issue by this Court in the first instance. On the otherhand, we are of the view that once the High Court renders itsdecision, this Court will have the benefit of the findings of theHigh Court, if occasion arises.

4. In view of the foregoing discussion, both the writ petitionsand the transferred case, WPs (C) Nos. 96 of 2011, 36 of 2012and TC (C) No. 30 of 2010 are sent to the High Court for theirdisposal on merits in accordance with law. We request the HighCourt to decide the writ petitions expeditiously.”

14. Apart from the above, it is noticeable from the latest decisionof the 3-Judge Bench in M/s Cummins Technologies India Pvt. Ltd.(supra) that even when the cases were indicated to be pending indifferent High Courts involving similar issues concerning constitutionalvalidity of Section 16(2)(c) of the Central Goods and Services Tax Act,2017 and it was submitted that the issues might have implication on anumber of matters pending across the country with ramification of hugeamount payable under the said Act, this Court expressed disinclinationto entertain the transfer petitions for the reason that various High Courtswere already seized of the matter and it was also noticed that beforeone High Court, the pleadings had been exchanged. Therefore, whiledeclining the prayer for transfer, this Court expected expeditious disposalof the pending petitions before the respective High Courts. The order sopassed by this Court on 20.09.2021 reads as under: - “The Court is convened through Video Conferencing.

Heard Mr. Tushar Mehta, learned Solicitor General,Mr. S. V. Raju, learned Additional Solicitor General appearing forthe Union of India, learned counsel appearing for RespondentNo. 1, who is on caveat, and carefully perused the record.

These transfer petitions have been filed by the Union ofIndia under Article 139A read with Article 142 of the Constitutionof India seeking transfer of two Writ Petitions to this Court, i.e.,(i) Writ Petition No. 9443/2020 titled ‘M/s. Cummins Technologiesvs Union of India’ pending before the High Court of MadhyaPradesh at Indore and (ii) Writ Petition No. 7767/2020 titled A

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‘M/s. SPL Infrastructure Private Limited v. AssistantCommissioner of State Tax, Narasannapeta and Ors.’ pendingbefore the High Court of Andhra Prdesh at Amaravati. In boththese Writ Petitions, the constitutional validity of Section 16(2)(c)of the Central Goods and Services Tax Act, 2017 has beenchallenged.

In addition to the aforementioned two Writ Petitions, weare informed that the constitutional validity of Section 16(2)(c)of the CGST Act has been challenged in 34 other writ petitions,which are stated to be pending across nine High Courts in thecountry.

According to learned Solicitor General, since the issue hasimplication on a number of matters pending across the countryand also ramifications of huge amounts payable under the saidAct, it would be appropriate if this Court hears all the matters.

Even though learned Solicitor General insisted for transferof cases pending before various High Courts to this Court, we arenot inclined to entertain these transfer petitions, for the reasonthat various High Courts are already seized of the matters. Inparticular, in the matter before the High Court of M.P., IndoreBench, counter affidavit is already stated to have been filed.

In view of the above, we request the High Court ofMadhya Pradesh, Indore Bench to dispose of the Writ PetitionNo.9443/2020, pending adjudication before it, as early as possibleand preferably within a period of two months’ time from the dateof communication of this Order.

Parties are at liberty to advance their respective argumentsbefore the High Court of Madhya Pradesh, Indore Bench.

So far as other Writ Petitions, which are pending beforevarious High Courts, it is open for the parties to bring this Orderto the notice of the concerned High Courts and seek expeditiousdisposal of their cases.

The Transfer Petitions are disposed of in the afore-statedterms.

Pending applications, if any, shall also stand disposed of.”

15. We need not multiply the reference to various other orderspassed by this Court relating to the prayer for transfer because, ultimately,the decision to transfer or not, to this Court or to one High Court, hasbeen taken by this Court in exercise of its jurisdiction under Article 139Aof the Constitution of India with reference to the given set of facts andcircumstances. No hard and fast rule or any structured formula isprovided nor appears desirable; a comprehensive view of all the factsand relevant surrounding factors is the best guiding light for exercise ofthis jurisdiction under Article 139A of the Constitution of India.

16. In the present set of facts and circumstances, for what hasbeen noticed and discussed hereinabove, we are clearly of the view thattransfer of the pending writ petitions from the respective High Courts isnot called for. The likelihood of divergence of views, looking to theframework of the statute itself, cannot be a ground for transfer. Equally,there appears no reason to transfer the matters to any one High Court;rather it appears just and proper that the petitions in the jurisdictionalHigh Courts are decided with reference to their own factual backgroundand the law applicable. Hence, we do not consider it necessary to dealwith the cases cited in support of the proposition for transfer of thematters to any one High Court, like the decision in the case of Instituteof Chartered Accountants of India (supra).

17. Accordingly, the prayer for transfer of the subject petitions isdeclined and all the interim stay orders are vacated while providing thatit shall be permissible for the parties to request the respective High Courtsfor expeditious hearing and disposal of the pending writ petitions. Forthat matter, we would also request the respective High Courts to proceedwith the matters expeditiously, while assigning them reasonable priority.

Nidhi Jain

Petitions disposed of.

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