Full Judgment Text
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PETITIONER:
SECURITY GUARDS BOARD FOR GREATERBOMBAY & THANA DISTT. ETC.
Vs.
RESPONDENT:
SECURITY & PERSONNEL SERVICE PVT. LTD.& ORS. ETC.
DATE OF JUDGMENT28/04/1987
BENCH:
REDDY, O. CHINNAPPA (J)
BENCH:
REDDY, O. CHINNAPPA (J)
KHALID, V. (J)
CITATION:
1987 AIR 1370 1987 SCR (3) 19
1987 SCC (3) 413 JT 1987 (2) 328
1987 SCALE (1)1198
ACT:
Maharashtra Private Security Guards (Regulation of
Employment and Welfare) Act, 1981: s. 23 read with ss. 22
and 1(4)--Exemption from Act--Denial of to security agencies
or agents--Validity of-Government whether required to state
reasons.
Administrative Law:
Exemption from provisions of a statute--Refusal
of--Government whether to state reasons.
HEADNOTE:
Section 1(4) of the Maharashtra Private Security Guards
(Regulation of Employment and Welfare) Act, 1981 makes the
provisions of the Act applicable to security guards who were
not direct and regular employees of the factory or the
establishment. A ’security guard’ is defined in s. 2(10) as
a person who is engaged or is to be engaged through any
agency or an agent to do security work. Section 3 empowers
the State Government to make schemes to provide for the
registration of employers and security guards and the terms
and conditions of employment of registered security guards
and their general welfare. Section 22 provides for preserva-
tion or’ existing rights and privileges of security guards
if they are more favourable to them than those under the
Act. Section 23 empowers the State Government to exempt
security guards from the operation of the provisions of the
Act or any scheme made thereunder.
The Security Guards Board was constituted under s. 6 of
the Act and the Private Security Guards (Regulation or’
Employment and Welfare) Scheme, 1981 was also made to give
effect to the Act.
The respondents’ applications for exemption from the
provisions of the Act having been rejected by the State
Government they filed writ petitions before the High Court
which were dismissed by a Single Judge.
20
On appeal, the Division Bench took the view that the
applications had been rejected as a result of the policy
decision not to grant exemption to any security agency and
that this was wrong, that each application for exemption had
to be considered on its own merits and so disposed of, and
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consequently directed the Government to consider the appli-
cations afresh.
In these appeals, it was contended for the appellant
Security Guards Board that s. 23 of the Act did not contem-
plate the grant of exemption in favour of a security agency,
on which ground alone the applications were liable to be
rejected, and that the applications were rejected after
consideration on merits and not on the basis of any policy
decision. For the respondents it was argued that if s. 23
was read in the light of s. 22 it would follow that an
agency could ask for exemption from the operation of the
Act, that wherever the conditions of service were better
than those proposed under the scheme the Government was
under a duty to grant exemption, and that the Act did not
contemplate the abolition of the agency system as such or
termination of the contract of employment between the agency
and the security guards, or for the transfer of the services
of the security guards from the employment of the agency to
that of the factory or establishment.
Allowing the appeals, the Court,
HELD: 1. The orders of the State Government refusing to
grant exemption to the respondents from the operation or’
the provisions of the Maharashtra Private Security Guards
(Regulation of Employment and Welfare) Act, 1981 do not call
for any interference. [32GH]
2. Section 23 of the Act read with s. 1(4) and the
definition of ’security guard’ in s. 2(10) makes it apparent
that the exemption is in regard to security guards employed
in any factory or establishment or in any class or classes
of factories or establishments and not in respect of an
agency or an agent. All security guards employed in a facto-
ry may be exempted or security guards of a particular grade
or doing a particular type of work in the factory may be
exempted. Again, all security guards employed in a class of
factories, say textile mills, may be exempted. All security
guards in textile mills doing a particular type of work or
drawing a particular scale of pay may be exempted. The
correlationship of the security guards or classes of securi-
ty guards who may be exempted from the operation of the Act
is to the factory or establishment or class or classes of
factories or establishments in which they work and not to
the agency or agent through and by whom they are employed.
[30A-D]
21
3. The question is not one of locus standi at all but
which or what class of security guards are to be exempted
from the operation of the Act and the scheme. The security
guards or classes of security guards employed in a factory
or establishment or in a class or classes of factories or
establishments may apply to the Government to exempt them
from the operation of the Act. Similarly a factory or an
establishment or a class or classes of factories or estab-
lishments may apply to the Government to exempt security
guards employed in their factories or establishments from
the operation of the Act. Where security guards have been
engaged or are to be engaged through an agency or agent in
any factory or establishment or a class of factories or
establishments, such an agency Or agent may also apply to
the Government, not t9 exempt all security guards engaged or
to be engaged through them but to exempt security guards
engaged or to be engaged in a factory or establishment or a
class of factories or establishments. The exemption to be
granted by the Government is not to be of any agency or
agent but only of security guards employed in a factory or
establishment or a class or classes of factories or estab-
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lishments. [30H-31 A; 30E; G; 31 AB]
4. Even if s. 23 is read in the light of s. 22 it does
not follow that any agency can ask for exemption from the
operation of the Act of all security guards employed through
them. All that s. 22 provides in effect is that the rights
or privileges of any registered security guard shall not be
altered to his detriment, which only means that if hitherto
as an employee of the agency the terms and conditions of his
service were more attractive on the whole than the terms and
conditions of service offered by the Act and the scheme
under the factory or establishment, the original terms and
conditions of service will be preserved and become applica-
ble to their service under the factory or establishment.
[31B-D]
5. The Act and the scheme provide for termination of the
contract of employment between the agency and the security
guards, and by necessary implication the services of the
security guards will stand transferred to the service of the
factory or establishment on allotment to it by the Board. It
is in that fashion, among other things, that security of
service is secured to the security guards. [31-DE]
6. In cases of this nature where exemptions are sought
from the operation of the Act, it is not necessary for the
Government to state its reasons. Of course if there is a
charge of mala fides or arbitrariness. the Court may look
into the matter to discover if there were any mala fides or
if the refusal of the Government was arbitrary. In the
instant case. there was none. [32GH]
22
7. The merits of each case were fully considered by the
Government and the applications were rejected because it was
their policy not to grant exemption if it was not in the
interest of the security guards. There was no predeter-
mined policy decision as such. [32F]
8. Every individual registered security guard who was
previously working in a factory or establishment will be
allotted to the same factory or establishment and if the
total package of the terms and conditions of his service
were better than the terms and conditions of service offered
by the Board such person would be employed on the previous
terms and conditions of service. [33CD]
9. Charging of ’capitation fee’ by a union before spon-
soring a security guard tot registration under the scheme is
not permissible under the Act or the scheme. [33E]
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal Nos. 1926-50
of 1986 etc.
From the Judgment and Order dated 20.2. 1986 of the
Bombay High Court in O.S. Appeal Nos. 616, 673,674 to
692,694 and 725 of 1985.
Soli J. Sorabji, K.K. Singhvi, A.K. Gupta, B. Bhushan,
N.P. Mohindra, J.P. Cama, Mukul Mudgal, A.M. Khanwilkar,
K.V. Murrup Menon, Mrs. V.D. Khanna, M.G. Ramachandran,
Pratap H. Toprani, Sanjeev Anand and A.S. Bhasme for the
appearing parties.
The Judgment of the Court was delivered by
CHINNAPPA REDDY, J. It appears that there were serious
complaints about the service conditions of about 70,000
persons working as Security Guards in various factories and
establishments in Greater Bombay and Thane Industrial Com-
plex, the majority of whom were employed through about 250
Security Agencies operating in those areas. The complaints
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related not merely to insufficient remuneration paid to them
by the agencies, but also to insecurity of service and other
forms of exploitation. There was a sample survey conducted
by the Government of Maharashtra to ascertain the extent of
exploita-
23
tion and to secure information regarding the service condi-
tions of the Security Guards. The sample survey revealed
that most of the agencies were not registered under the
Shops and Establishments Act. There was only one registered
union but that union accounted for membership of 2200 only.
It was found that most of the Security Guards did not enjoy
the benefit of any Provident Fund Scheme or any scheme of
Gratuity. Most of them were not covered by the Employees’
State Insurance Scheme and had no medical facilities. Leave
facilities were inadequate. Rest intervals were not properly
provided. Wages were low and only a few agencies paid over-
time and bonus. Most of them did not also have either drink-
ing water facility, canteen facility or transport facility.
A very meager percentage of Guards were provided with living
quarters. It was recommended that it was absolutely neces-
sary to prevent exploitation of the unprotected Security
Guards and to provide them with better service conditions.
Pursuant to the report of the committee which made the
sample survey, the Government issued the Maharashtra Private
Security Guards (Regulation of Employment and Welfare)
Ordinance. The Ordinance was replaced by the Maharashtra
Private Security Guards (Regulation of Employment and Wel-
fare) Act, 1981. The vires of the Act were challenged in
various writ petitions filed in the High Court of Bombay by
Security Agencies. They were dismissed by the High Court and
a petition for special leave to appeal under Art. 136 of the
Constitution was dismissed by the Supreme Court on January
5, 1983. While dismissing the special leave petition, the
Supreme Court gave the following directions:
"It appears that some of the petitioners have
applied to the State Government to accord
exemption to them from the operation of the
provisions of the Private Security Guards
(Regulation of Employment and Welfare).
Scheme, 1981 and those applications are under
the consideration of the State Government. We,
therefore, direct that the above scheme shall
not be enforced as against the petitioners
herein till the end of January 1983. The State
Government should dispose all applications
made by the petitioners before January 31,
1983."
This order was subsequently modified in the
following manner:
"The order dated January 5, 1983 is modified
by deleting the entire portion of the order
following upon the words "these special leave
petitions are dismissed." The scheme will be
brought into force forthwith."
24
In the judgment of the learned Single Judge who dis-
missed the writ petitions initially, the learned Judge had
held that it was competent for security agencies to seek
exemption from the operation of the provisions of the Act.
As many as 139 security agencies applied to the Government
under sec. 23 of the Act for grant of exemption from the
provisions of the Act. These applications were first
screened by the Advisory Committee who recommended that
exemption might be granted to 21 agencies. The cases of four
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other agencies which were not recommended by the Advisory
Committee were again investigated by the Labour Commissioner
who recommended that these four agencies also might be
granted exemption from the provisions of the Act. On June
28, 1984, the Government of Maharashtra finally rejected all
the applications for exemption filed by the various security
agencies. Several security agencies thereupon filed writ
petitions in the High Court of Bombay. The twenty five writ
petitions filed by the twenty one agencies whose cases were
recommended by the Advisory Committee and the four agencies
whose cases were recommended by the Labour Commissioner were
admitted by the High Court and the rest were dismissed in
limine. The twenty five writ petitions which were admitted
were also finally dismissed on July 11, 1985 by a learned
Single Judge. On appeals preferred by the twenty five secu-
rity agencies, a Division Bench of the Bombay High Court
directed the State Government to consider afresh the appli-
cations for exemption. An objection raised on behalf of the
Security Guards Board and the Government of Maharashtra that
security agencies could not seek exemption under sec. 23 of
the Act was overruled. The Bombay High Court took the view
that the applications had been rejected as a result of the
policy decision not to grant exemption to any security
agency and that this was wrong. The High Court held that
each application for exemption had to be considered on its
own merits and so disposed of. Hence the direction to the
Government to consider the applications afresh.
The Security Guards Board constituted under sec. 6 of
the Act has preferred these twenty five appeals against the
judgment of the Bombay High Court.
Shri K.K. Singhvi, learned counsel for the appellant,
the Security Guards Board for Greater Bombay and Thana
District, argued that sec. 23 of the Act did not contemplate
the grant of exemption in favour of a security agency and
therefore, the applications for exemption were liable to be
rejected on that ground alone. He further submitted that the
High Court was wrong in holding that the applications had
25
been rejected on the basis of any policy decision. They were
rejected after consideration of all the applications on
merits. If there was a policy decision such a decision was
arrived at on a consideration of all the applications for
exemption and it was that none of the applications deserved
to be allowed. Shri Soli Sorabji and other learned counsel,
who followed him, argued that the Act did not contemplate
the abolition of the agency system as such and it was only
meant to regulate and provide better conditions of service
for Security Guards. Wherever the conditions of service were
better than those proposed under the Scheme, the Government
was under a duty to grant the necessary exemption so that
the employees may have the benefit of the advantageous
conditions of service. According to them, this result flowed
from a perusal of the Act, in particular sees. 22 and 23. It
was also urged that the High Court was right in its conclu-
sion that the applications for exemption had not been re-
jected on merits but because of a policy decision.
We may now proceed to consider the rival submissions
with reference to the provisions of the Maharashtra Private
Security Guards (Regulation of Employment and Welfare) Act,
1981. The preamble to the Ordinance which preceded the Act
recited, ". ....and whereas the Governor of Maharashtra is
satisfied that circumstances exist which render it necessary
for him to take immediate action to make a law for regulat-
ing the employment of private Security Guards employed in
factories and establishments in the State of Maharashtra and
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for making better provision for their terms and conditions
of employment and welfare, through the establishment of a
Board therefore, and for matters connected
therewith ....... ". The long title of the Act is, "An Act
for regulating the employment of private Security Guards
employed in factories and establishments in the State of
Maharashtra and for making better provisions for their
terms and conditions of employment and welfare, through
the establishment of a Board therefore, and for matters
connected therewith." Sec. 1(4) makes the Act applicable,
"to persons who work as Security Guards in any factory or
establishment, but who are not direct and regular employees
of the factory or the establishment as the case may be."
Secs. 2(1), (3), (4), (5), (8) and (10) defines the expres-
sions "agency", "employer", "establishment", "facto-
ry", "principal employer" and "Security Guard" as
follows:-
" "agency", or "agent", in relation to a
Security Guard,
26
means an individual or body of individuals or
a body Corporate, who undertakes to execute
any security work or watch and ward work for
any factory or establishment by engaging such
Security Guard on hire or otherwise, or who
supplies such Security Guards either in groups
or as an individual, and includes a sub-agency
or a sub-agent;
"employer", in relation to a Security Guard
engaged by or through an agency or agent,
means the principal employer, and in relation
to any other Security Guard, the person who
has ultimate control over the affairs of the
factory or establishment and includes any
other person to whom the affairs of such
factory or establishment are entrusted, wheth-
er such person is called an Agent, Manager or
by any other name prevailing in the factory or
establishment;
"establishment" means an establishment as
defined in clause (8) of section 2 of the
Bombay Shops and Establishments Act, 1948;
"factory" means a factory as defined in clause
(m) of section 2 of the Factories Act, 1948;
"principal employer" means an employer who has
engaged Security Guards through an agency or
agent;
"Security Guard" or "private Security Guard"
means a person who is engaged or is to be
engaged through any agency or an agent, wheth-
er for wages or not, to do security work or
watch and ward work in any factory or estab-
lishment and, includes any person, not em-
ployed by any employer or agency or agent, but
working with the permission of, or under an
agreement with, the employer or agency or
agent, but does not include the members of any
employer’s family or any person who is a
direct and regular employee of the principal
employer;"
Section 3 empowers the State Government for the purposes of
ensuring an adequate supply and full and proper utilisation
of Security Guards in factories and establishments and
generally for making better provisions in the terms and
conditions of employment of such workers, to make one or
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more schemes to provide for the registration of emp-
27
loyers and Security Guards in any factory or establishment
and to provide for the terms and conditions of employment of
registered Security Guards and to make provisions for the
general welfare of such Security Guards. The matters in
regard to which provisions may be made in the scheme are
also set out in sec. 3(2) (a) to (n). We may mention that
clause (d) of sec. 3(2) in particular relates to terms and
conditions of employment, including the rates of wages,
hours of work, maternity benefit, over-time payment, leave
with wages, provision for gratuity and conditions as to
weekly and other holidays and pay in respect thereof. We
should also mention here that sec. 3(2)(g) provides that the
scheme may prohibit, restrict or otherwise control the
employment of Security Guards to whom the scheme does not
apply and the employment of Security Guards by employers to
whom the scheme does not apply. Sec. 3(3) provides that the
scheme may further provide for punishment for a contraven-
tion of any provision of the scheme with imprisonment or
with fine. Sec. 4 prescribes the procedure for making,
varying or revoking a scheme. Sec. 6 provides for the con-
stitution of a Board for the Security Guards in any area.
Sec. 8 prescribes the powers and duties of the Board. Sec.
15 provides for the constitution of an Advisory Committee.
Secs. 19, 20 and 21 provide for the application of Workmen’s
Compensation Act, Payment of Wages Act and Maternity Benefit
Act to Security Guards. Secs. 22 and 23 are important. Sec.
22 provides for the preservation of existing rights and
privileges if they are more favourable and sec. 23 provides
for exemption from the provisions of the Act. These provi-
sions are important for our present purposes. They are as
follows:-
"22. Nothing contained in this Act shall
affect any rights or privileges, which any
registered Security Guard employed in any
factory or establishment is entitled to, on
the date on which this Act comes into force,
under any other law, contract, custom or usage
applicable to such Security Guard, if such
rights or privileges are more favourable to
him than those to which he would be entitled
under this Act and the Scheme:
Provided that, such Security Guard
shall not be entitled to receive any corre-
sponding benefit under the provisions of this
Act and the Scheme.
23. The State Government may, after consulting
the Advisory Committee, by notification in the
Official Gazette, and subject to such condi-
tions and for such period
28
as may be specified in the notification,
exempt from the operation of all or any of
the,provisions of this Act or any Scheme made
thereunder, all or any class or classes of
Security Guards employed in any factory or
establishment or in any class or classes of
factories or establishments, if in the opinion
of the State Government, all such Security
Guards or such class or classes of Security
Guards are in the enjoyment of benefits, which
are on the whole not less favourable to such
Security Guards than the benefits provided by
or under this Act or any Scheme made thereun-
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der:
Provided that, before any such
notification is issued, the State Government
shall publish a notice of its intention to
issue such notification, and invite objections
and suggestions in respect thereto and no such
notification shall be issued until the objec-
tions and suggestions have been considered and
a period of one month has elapsed from the
date of first publication of the notice in the
Official Gazette:
Provided further that, the State
Government may, by notification in the Offi-
cial Gazette, at any time, for reasons to be
specified, rescind the aforesaid
notification."
Pursuant to the powers conferred by s. 4 of the Act, the
Government of Maharashtra after consulting the Advisory
Committee made the Private Security Guards (Regulation of
Employment and Welfare) Scheme, 1981. Paragraph 11 of the
Scheme requires the Board to maintain (1) a register of
employers, and (2) a Pool Register which shall be a register
of Security Guards. Paragraph 12 empowers the Board to
arrange for the classification of Security Guards in suit-
able categories as may be determined by it from time to
time. Paragraph 14 requires ’every employer who has engaged
private Security Guards on the appointed day or at any time
thereafter to ’get himself registered with the Board’ by
applying in the prescribed form. The employer of an estab-
lishment coming into existence after the commencement of the
Scheme is required to apply for registration simultaneously
with the commencement of its business. Paragraph 15 requires
’any Security Guard who was working on the appointed day or
at any time thereafter in the employment in the area to
which the Scheme applies’ to ’apply to the Board’ in the
prescribed form. Paragraph 25 provides that every registered
Security Guard shall be deemed to have accepted
29
the obligation of the Scheme. A registered Security Guard in
the pool who is available for work is required not to engage
himself for employment under any registered employer unless
he is allotted to that employer by the Secretary of the
Board. A registered Security Guard in the pool who is avail-
able for work is further required to carry out directions of
the Board and to accept employment under any registered
employer for which he is considered suitable by the Board.
Paragraph 26 provides that every registered employer shall
accept the obligations of the Scheme. A registered employer
is required not to employ a Security Guard other than a
Security Guard who has been allotted to him by the Secre-
tary. A registered employer is however at liberty to employ
Security Guard directly, A registered employer is required
to disburse to the Security Guard the wages and other allow-
ances directly, if so directed by the Board and send to the
Board a statement of such payment within the prescribed
time. Paragraph 27 prohibits the employment by a registered
employer of a Security Guard unless the Security Guard is a
registered Security Guard or a directly employed Security
Guard. Paragraph 29 makes detailed provision for wages,
allowances and other conditions of service of Security
Guards. Paragraph 30 provides for the disbursement of wages
and other allowances to the Security Guards. Paragraph 31
provides for disciplinary procedure. Paragraph 32 prohibits
the termination of employment of registered Security Guard
except in accordance with the provisions of the Scheme.
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Paragraph 33 and paragraph 34 provide for appeals and termi-
nation. Paragraph 35 provides. for revision. Paragraph 37
provides for the cost of operating the Scheme and makes
provision for amenities and benefits to the registered
Security Guards.
It is obvious from s. 1(4) and the very definition of
’Security, Guard’ that the Act and, therefore, the Scheme
are not applicable to persons who are direct and regular
employees of a factory or establishment but are applicable
only to persons working in any factory or establishment who
are engaged or are to be engaged through an agency or agent
and to persons who though not employed by the employer or
agency or agent are working with their permission or under
an agreement with them. Section 23, we have seen, provides
for exemption from the operation of all or any of the provi-
sions of the Act or any scheme made thereunder of "all or
any class or classes of Security Guards employed in any
factory or establishment or in any class or classes of
factories or establishments." The basic condition to be
satisfied is that the State Government should be of the
opinion that "all such Security Guards or such class or
classes of Security Guards are in the enjoyment of benefits,
which are on the whole not less
30
favourable to such Security Guards than the benefits provid-
ed by or under this Act or any Scheme made thereunder. "A
close scrutiny of s. 23, particularly in the light of s.
1(4) read with the definition of ’Security Guard’, makes it
clear that the exemption is not in respect of an agency or
an agent or even a factory or establishment but in respect
of all or any class or classes of Security Guards employed
in any factory or establishment or in any class or classes
of factories or establishments. In other words, the exemp-
tion is in regard to ’Security Guards’, employed in any
factory or establishment or in any class or classes of
factories or establishments. The exemption may be in respect
of all the Security Guards employed in a factory or estab-
lishment or in a class or classes of factories or establish-
ments or in respect of a class or classes of Security Guards
so employed. For example, all Security Guards employed in
factory may be exempted or Security Guards of a particular
grade or doing a particular type of work in factory may be
exempted. Again all Security Guards employed in a class of
factories, say textile mills may be exempted. All Security
Guards in all textile mills doing a particular type of work
or drawing a particular scale of pay may be exempted. The
correlationship of the Security Guards or classes or Securi-
ty Guards who may be exempted from the operation of the Act
is to the factory or establishment or class or classes of
factories or establishments in which they work and not with
the agency or agent through and by whom they are employed.
This analysis has however no bearing on the question of
locus standi of the persons who may seek the intervention of
the State Government by the issue of notifications for
exemption. Obviously the Security Guards or classes or
Security Guards employed in a factory or establishment may
apply to the Government to exempt them from the operation of
the Act. Similarly Security Guards or classes of Security
Guards employed in classes of factories or establishments
may apply to the Government to exempt them from the opera-
tion of the Act. Again a factory or an establishment or a
class or classes of factories or establishments may apply to
the Government to exempt Security Guards employed in their
factories or establishments from the operation of the Act.
Though agencies or agents do not enter the picture directly,
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since the very definition of Security Guards means persons
engaged or to be engaged through an agency or agent, it must
follow that where Security Guards have been engaged or are
to be engaged through them in any factory or establishment
or a class of factories or establishments, such agency or
agent may also apply to the Government, not to exempt all
Security Guards engaged or to be engaged through them out to
exempt Security Guards engaged or to be engaged in a factory
or establishment or a class of factories or establishments.
The question is
31
not one of locus standi at all but which or what class of
Security Guards are to be exempted from the operation of the
Act and the Scheme. Therefore, we are of the view that even
an agency or agent may apply to the Government to grant
exemption, but the exemption to be granted by the Government
is not to be of any agency or agent but only of Security
Guards employed in a factory or establishment or a class or
classes of factories or establishments.
One of the submissions of the learned counsel was that
if s. 23 was read in the light of s. 22 it would follow that
an agency could ask for exemption from the operation of the
Act of all Security Guards employed through them. We do not
see how that follows. All that s. 22 provides in effect is
that the rights or privileges of any registered Security
Guard shall not be altered to his detriment. It only means
that if hitherto as an employee of the agency, the terms and
conditions of his services were more attractive on the whole
than the terms and conditions of service offered by the Act
and the scheme under the factory or establishment, the
original terms and conditions of service will be preserved
and become applicable to their service under the factory or
establishment. It was submitted by the learned counsel that
the Act and the Scheme did not provide for termination of
the contract of employment between the agency and the Secu-
rity Guard or for the transfer of the services of the Secu-
rity Guards from the employment of the Agency to that.of the
factory or establishment. We do not agree with the submis-
sion. By necessary implication, the services of the Security
Guards will stand transferred to the service of the factory
or establishment on allotment to it by the Board. It is in
that fashion, among other things, that security of service
is secured to the Security Guards.
The High Court appeared to think that all the applica-
tions were rejected on the ground that a policy decision had
been taken not to grant exemption in any case. The High
Court relied on the affidavit of Shri Rajadhyaksha. It was
stated in the affidavit of Shri Rajadhyaksha that the opin-
ion of the Advisory Committee was sought on the applications
for exemption and the Advisory Committee recommended the
applications of 21 applicants. Later the cases of four other
applicants were recommended by the Labour Commissioner.
After referring to these circumstances, Shri Rajadhyaksha
stated in the affidavit.
"I say that after the receipt of the recommen-
dations from the Advisory Committee by the
Department of Industries, Energy and Labour,
all the papers were submitted to the
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Chief Minister through the Minister for Labour
and the Minister of State for Labour to con-
sider whether to publish the notice of the
Government’s intention to issue such notifica-
tion and invite objections and suggestions in
respect thereto. I say that after considering
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all the pros and cons of the problem, the
Hon’ble the Chief Minister, in consultation
with the Hon’ble Minister for Labour and the
Hon’ble Minister of State for Labour took the
decision that none of the agencies who had
applied for exemption should be granted exemp-
tion under s.23 of the said Act because grant-
ing of such exemption will not be in the
interest of the Security Guards employed with
the agencies."
Later again Shri Rajadhyaksha stated;
"I say that simply because the Advisory Com-
mittee had recommended the case for exemption,
it was not obligatory on the State Government
to publish a notice of its intention to issue
notification for exemption as alleged therein.
I say that it was for the Government to con-
sider the entire matter and to decide whether
such a notification should be issued or not
and if as a matter of policy and after going
through the entire case the Government decided
not to grant exemption no exception can be
taken to the decision of the State
Government."
We do not read the affidavit of Shri Rajadhyaksha to say
that there was a predetermined policy decision pursuant to
which all the applications for exemption were rejected
without any consideration on merits. What the deponent of
the affidavit meant to say was that the merits of each case
were fully considered and the applications were rejected
because it was their policy not to grant exemption if it was
not in the interest of the Security Guards; A complaint was
made that the Government did not state its reasons for
rejecting the applications for exemption. We do not think
that in cases of this nature where exemptions are sought
from the operation of the Act, it is necessary for the
Government to state its reasons. Of course, if there is a
charge of mala-fides or arbitrariness, the court may look
into it to discover if there are any mala-fides or if the
refusal of the Government was arbitrary. We do not think
that the orders refusing to grant exemptions in the present
cases call for any interference on the sole ground of fail-
ure to state reasons.
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In the result all the appeals are allowed and the writ
petitions filed in the High Court are dismissed. Civil Writ
Petition No. 12319 of 1985 filed by one of the agencies in
this Court is also dismissed. The State of Maharashtra has
also filed a special leave petition against the judgment of
the Bombay High Court. It is disposed of on the same lines
as the civil appeals.
On behalf of some of the Security Guards a writ petition
was filed in the Bombay High Court and it has been withdrawn
to this Court to be disposed of along with the appeals. One
of the contentions raised in the writ petition filed by the
workmen is that the Scheme does not offer any continuity or
guarantee of employment to those who are already working in
factories or establishments having been engaged through
agencies. We are assured by Shri K.K. Singhvi, learned
counsel for the Board that every individual registered
Security Guard who was previously working in a factory or
establishment will be allotted to the same factory or estab-
lishment and if the total package of the terms and condi-
tions of his service were better than the terms and condi-
tions of service offered by the Board such person should be
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employed on the previous terms and conditions of service.
The assurance of Shri Singhvi is made part of our order. The
learned counsel for the workmen also urged that there was an
insistence upon payment of ’capitation fee’ and sponsoring
by a union before a Security Guard was registered under the
Scheme. This, of course is not permissible under the Act or
the Scheme and whoever has been so insisting will desist
from doing so.
P.S.S. Appeals
allowed.
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