National Jute Manufacturing Corporation National Employees Union and ors. Vs. Union of India (Uoi) and ors. - Court Judgment

Ruma Pal, J.

1. This writ application has been filed by the clerical and sub- staff employees of the head office of the National Jute . (referred to as the 'NJMC'). The employees are represented by two unions.

2. The question raised in this writ application is whether the employees represented by the petitioners should be governed by the provisions of the Employees' State Insurance Act, 1948, or whether they should continue to enjoy the medical and other benefits which had been granted by NJMC to these employees all along.

3. Briefly stated, according to the petitioners, the employees should be exempted from the operation of the Employees' State Insurance Act, 1948, and should continue to be granted the benefits under the NJMC's Medical Treatment and Attendance Rules, while the respondents argue to the contrary. Before considering the arguments in support of the rival contentions in detail, the background of relevant facts is as follows:

4. NJMC was incorporated in June, 1980. At the time of its incorporation the total number of equity shares was 70,000 of which the President of India holds 69,998 and one was held by the then Additional Secretary and Financial Advisor, Ministry of Commerce and Civil Supplies and the other was held by the then Economic Advisor Ministry of Commerce and Civil Supplies. NJMC was formed for the purpose of taking over six mills which are now referred to as its units, namely, National, Kinnison, Alexandra, Union, Khardah and RBHM. Each unit has a jute mill. The head office of all the units is at Calcutta. The petitioners' employees are the clerical and sub- staff at the head office of national unit of NJMC.

5. On April 19, 1948, the Employees' State Insurance Act, 1948 (referred to as 'the Act'), had come into force. The Rules were framed under Section 95 of the Act known as the Employees' State Insurance Central Rules, 1950. The Act was applicable to the six units prior to their being taken over by NJMC. It continued to apply to the employees of NJMC.

6. Initially, the provisions of the Act were applicable to employees drawing less than Rs. 500 per month as salary. From time to time the Rules were amended and the coverage was extended to employees with higher salaries.

7. In 1982, the Medical Treatment and Attendance Rules, 1982, were formulated for application to the employees of NJMC. Rule 3(b)(iv) of the 1982 Rules provides that the Rules would not apply to 'employees who are governed by the Employees' State Insurance Act, 1948, and/or CGHS'. The Rules provided for the comprehensive treatment of employees, reimbursement of cost of medicines, consultation fees, laboratory test, indoor treatment, testing eye sight, etc. Advances were also available to the employees and members of their family, ambulance charges, travelling allowance for treatment were also made available to the employees and their family members.

8. According to the petitioners, on March 30, 1984, pursuant to a charter of demand raised by the unions of NJMC a memorandum of settlement was entered into between NJMC and its employees. According to the petitioners, the settlement provided, inter alia, for the grant of various medical benefits. The settlement expired on March 31, 1988.

9. On May 19, 1989, and July 4, 1989, two bipartite agreements were entered into between the unions of NJMC Ltd., and NJMC after the memorandum of settlement dated March 30, 1984, expired on March 31, 1988. The two memoranda of settlement are identical in all material respects with only the party unions being different Both the agreements came into force with effect from April 1, 1988, and were to remain in force up to March 31, 1992, until such time the parties arrived at a fresh settlement.

Clause 17 of the memoranda of settlement provides:

'17. Medical benefits. -The existing benefits shall continue. In view of the inordinate rise in the drawal of the medical benefits at all levels, it has been agreed that the present scheme will be reviewed and discussed before implementation shortly after signing of this agreement Any change in the rates in respect of Clause 11 to Clause 15 by way of Government circulars notifications from time to time shall be made applicable to all the employees governed under the NJMC Service Rules.'

10. On March 27, 1992, the Government of India issued a notification See (1992) 80 IFJ (ST) 337 under Section 95(1) of the Act which in so far as it is relevant reads as follows:

'Whereas certain draft rules further to amend the Employees' State Insurance (Central) Rules 1950, were published, as required under Sub-section (1) of Section 95 of the Employees' State Insurance Act, 1948 (34 of 1948), in the Notification of the Government of India in the Ministry of Labour No. G.S.R.698, dated December 3, 1991, in the Gazette of India, Part II, Section 3, Subsection (i), dated December 14, 1991, inviting suggestions and objections from all persons likely to be affected thereby till the expiry of the period of forty-five days from the date on which the copies of the Gazette of India, in which the said notification was published, were made available to the public;

And, whereas, the copies of the said Gazette were made available to the public on December 15, 1991;

And, whereas, objections and suggestions received from persons likely to be affected thereby have been considered by the Government

Now, therefore, in exercise of the powers conferred by Section 95 of the said Act, the Central Government, after consultation with the Employees' State Insurance Corporation, hereby makes the following rules further to amend the Employees' State Insurance (Central) Rules, 1950, namely:-

'1. (1) The rules may be called the Employees' State Insurance (Central) First Amendment Rules, 1992.

(2) They shall come into force with effect from April 1, 1992.

2. In the Employees' State Insurance (Central) Rules, 1950:-

(1) In rule 50 and its proviso, for the words 'one thousand six hundred' the words 'three thousand' shall be substituted.'

In other words coverage of the Act was extended from employees earning Rs. 1,600 per month to employees earning Rs. 3,000 per month.

Instructions were also issued by the Joint Regional Director of the Employees State Insurance Corporation (referred to as 'ESIC') on March 30, 1992, to all employers as to the procedure to be followed by the employer for enabling employees not earning more than Rs. 3,000 to obtain medical benefits under the Act.

11. On April 9, 1992, the General Manager, NJMC, issued a notice informing the employees of NJMC of the notification dated March 27, 1992. Consequent upon the implementation of the notification it was notified that the employees contribution at 1.5 per cent. of the salary would be deducted from the monthly salary of the concerned employees with effect from the month of April, 1992, and deposited with ESIC along with the NJMC's contribution as per rules. It was further stated that upon the implementation of the Employees' State Insurance Act, reimbursement of medical expenses, etc., and sick leave with pay under relevant NJMC's Rules would stand automatically discontinued in respect of the employees newly covered/re-covered under the provisions of the Employees' State Insurance Act with effect from April 1, 1992.

12. On April 30, 1992, the petitioner unions made representations to the Secretary to the Government of India, Ministry of Labour, as well as to the Secretary to the Government of West Bengal, Labour Department, praying for exemption from the operation of the Act, the Rules, Regulations and Scheme framed thereunder in respect of all employees of NJMC unit; National at the head office. The burden of the representations was that by existing coverage under the Employees' State Insurance Act, by the notification dated March 27, 1992, the employees were being deprived of superior medical benefits and suffering financial burden on account of Employees' State Insurance coverage and that instead of operating as a welfare measure the intended coverage would prove to be counter-productive.

13. Similar representations were made on May 4, 1992, by the two petitioner-unions to the Chairman-cum-Managing Director of NJMC and the General Manager of the NJMC. Apart from stating that the existing medical benefits were far more superior as compared to the benefits given by the Employees' State Insurance authorities and that none of the members of the petitioner-unions were interested in being covered by the Employees' State Insurance Act, a request was made that NJMC should apply for exemption from the operation of the Act. NJMC was also requested not to make any deductions from the salary of the employees as notified.

14. This writ application was moved the next day, i.e., on May 5, 1992. An interim order was granted restraining the respondents from making any deduction from the salary of the employees represented by the petitioner-unions. By reason of the business of the court the matter could not be taken up for hearing expeditiously. Accordingly an order was passed on September 26, 1992, directing NJMC to grant medical and other benefits to the employees subject to their undertaking to refund the amounts paid to NJMC in the event the petitioners were ultimately unsuccessful.

15. In this factual background the petitioners have contended;

(1) In terms of the memoranda of settlement, 1989, entered into between unions they were entitled to get the medical benefits which they were enjoying irrespective of the application of the Act. The agreement had not been terminated nor replaced by any new agreement. Reliance has been placed oh the decision of the Supreme Court in LIC of India v. D.J. Bahadur, (1981-I-LLJ-l).

(2) there could be no change in the conditions of service of the employees without complying with Section 9-A of the Industrial Disputes Act, 1947.

(3) Under Section 1(4) of the Act, establishments under the control of the Government whose employees are in receipt of benefits similar or superior to the benefits provided by the Act were not subject to the provisions of the Act. NJMC was a Government company. It could not be disputed that the medical benefits granted by NJMC, under the Medical Treatment and Attendance Rules, 1982, were superior to the benefits which would be available under the Employees ' State Insurance Act. As such the Act did not apply to NJMC's employees. In any event, Section 72 prohibited employer from reducing the existing benefits of the employees on the plea of payment of employer's contribution. Reliance has been placed on the decision of Bareilly Electricity Supply Co. Ltd. v. Their Workmen, (1979-I-LLJ-352) (SC) in this context.

(4) The appropriate Government was bound to grant the exemption in the circumstances of the case under Sections 87 to 91 of the Act The Act was a social welfare legislation. If by extending the provisions of the Act to the employees, the employees suffered hardship, the Act should not be made applicable. The employees were the best judge of what would enure to their benefit. Reliance has been placed on the unreported decision of a learned single judge of this Court in Ramdeo Hazam v. Union of India (Matter No.929 of 1978 judgment dated September 13, 1982).

(5) Even if there were any doubt, it should be resolved in favour of employees who were the weaker section of the society. It is further submitted that NJMC being a State within the meaning of article 12 of the Constitution was bound to act reasonably and fairly and it was open to the court to give relief without directing the employees to avail of any remedy under the Act or any other statute including the Industrial Disputes Act. Reliance has been placed on the decision of K.C.P. Employees' Association v. K.C.P. Ltd., (1978-I-LLJ-322) (SC); L. Robert D' Souza v. Executive Engineer, Southern Railway, (1982-I-LLJ-330) (SC); Girdhari Lal and Sons v. Balbir Nath Mathur, : [1986]1SCR383 .

The respondent-Corporation has said:

(i) The National unit of NJMC, whose grievance was sought to be ventilated in the writ petition, was covered by the Act even before nationalisation. The grievance of the petitioner thus, could not be the coverage under the Employees' State Insurance Act but was limited to the extension of the coverage to persons drawing a salary up to Rs. 3,000.

(ii) Neither the notification dated March 27, 1992, nor the direction issued by the Joint Regional Director of the Employees' State Insurance Corporation had been challenged by the writ petitioners. The only subject-matter of challenge was the notice dated April 9, 1992, issued by NJMC. NJMC had to issue the notice. It was bound to implement the directions of the Employees' State Insurance Corporation in default of which its principal officers would be liable to penal measures including compulsory imprisonment

(iii) It is also submitted that the Medical Treatment and Attendance Rules, 1982, of NJMC specifically provided that it would not apply to employees governed by the Employees' State Insurance Act The Rules had not been challenged The 1989 agreements did not change this position. It is then submitted that even if the agreements were contrary to the provisions of the Act, the Act would have overriding effect It was not open to the employees to opt out of the benefits conferred by the Act. Reliance has been placed on the decision in Murali Dhar v. State of U.P. : [1975]1SCR575 . It is stated that there had been no violation of the memoranda of settlements and in any case if there had been such violation, the petitioners should have proceeded under the Industrial Disputes Act, 1947.

(iv) It is stated that the claim of the petitioners for exemption was grossly delayed. In any event, exemption could only be granted by the appropriate Government Although a representation had been made to the Government, no copy was served on the Employees' State Insurance Corporation. Furthermore, the representation to the Government was made on April 30, 1992, and the writ petition was moved within one week. There was no scope for the appropriate Government to have considered the representation at all. It was not a case where the appropriate Government had failed to discharge any duty.

(v) ft is stated that the Government alone could grant exemption and until such exemption was granted NJMC was under a statutory obligation to deposit the contributions with the Employees Insurance Fund, In the event the NJMC was exempted, refund could be made under Regulation 40 of the Employees' State Insurance (General) Regulations, 1950. Reliance has been placed on several unreported judgments of the Delhi and Rajasthan High Courts, as well as to an order dated April 24, 1985, by which a writ application challenging the extension of coverage under the Act was dismissed by a learned judge of this Court, C.O. No. 4339(W) of 1985 ; Amalendu Sarkar v. Union of India.

(vi) Regarding the benefits available to the employees, it is stated that this was not the correct position. In fact, the benefits conferred under the Act were much better. In any event, disputed questions of fact were involved, which this Court should not consider. Reliance has been placed on the Bench decision in Mahesh Kumar Gulani v. Calcutta Municipal Corporation, (1992) 2 CLJ 21.

(vii)As far as the petitioners' submission under Section 1(4) is concerned, it is stated that the non-applicability of the Act was dependent upon the factory or establishment belonging to or being under the control of the Government. NJMC was not a department of the Government but an independent entity having separate service regulations, separate establishment, etc. The factories of NJMC belonged to NJMC and not to the Government. NJMC was under the control of the board of directors, who were liable to penal prosecution in the event the provisions of the Act were not complied with. Reference has been made to a memorandum dated November 26, 1990, January 3, 1991, issued by the Ministry of Labour, Government of India, to the effect that the Act applied to all public sector undertakings/corporations, autonomous bodies etc., and that only departmental undertakings under the Government were excluded. In any event, the dispute under Section 1(4) whether the benefits granted under the Act were the same or similar to the ones granted heretofore by NJMC was determinable under Section 75 of the Act. Reliance has been placed on the decisions Sunil Kumar Debnath v. Mining and Allied Machinery Corporation (1968-I-LLJ-643)(Cal), State v. B.L. Ohri, : AIR1967Pat441 Surya Kant Roy v. Imamul Haj Khan : [1975]3SCR909 , and A.N. Sehgal v. Raje Ram Sheoram, (1991-II-LLJ-50).

16. As far as the NJMC is concerned although some of the arguments overlap with those advanced by the Employees State Insurance Corporation, the NJMC has in addition submitted:

(i) The writ application is liable to be dismissed on the ground of mis-joinder as two different prayers had been prayed against two different authorities.

(ii) Secondly, it is submitted that the application is grossly delayed, NJMC has all along been covered by the Employees' State Insurance Act The original coverage has not been challenged. There was no new cause of action. Ninety per cent, of members of the petitioner-unions were already covered under the Act having separate account numbers under the Act for a long time.

(iii) Thirdly, it is submitted that the representation to NJMC to ask for grant of exemption had been sent on May 4, 1992, and the writ petition was moved the next day. It is urged that NJMC had no chance to even consider or act on the representation.

(iv) It is also submitted that the union could only agitate with regard to infringement of a corporate right of the union itself and not of its members.

(v) If there were any difficulty in construing Clause 3(b)(iv) of Medical Treatment and Attendance Rules that along with other disputes raised by the petitioners were to be resolved by the Labour Court or the National Tribunal under Section 36-A of the Industrial Disputes Act, 1947. Reliance has been placed on the decision on Shyam Kishore v. Municipal Corporation, : AIR1992SC2279 . Reliance has also been placed on the decision in Basant Kumar Sarkar v. Eagle Rolling Mill (1964-II-LLJ-105), and K.M. Mukherjee v. S.B.I. (1969-I-LLJ-50).

(vi) As far as the petitioners' case under Section 1(4) is concerned, it is stated that the ground had not been taken in the petition. It is argued that the petitioners' case in the petition was that exemption should be granted on the basis that the Act was applicable.

17. In my view, the primary and basic issue which is to be determined is the question of the applicability of the Act itself to the employees of NJMC.

Section 1(4) of the Employees' State Insurance Act, 1948, reads as follows:

'1(4) It shall apply, in the first instance, to all factories (including factories belonging to the Government) other than seasonal factories:

Provided that nothing contained in this subsection shall apply to a factory or establishment belonging to or under the control of the Government whose employees are otherwise in receipt of benefits substantially similar or superior to the benefits provided under this Act.'

18. I am not persuaded to hold on the material before me that by virtue of the proviso, NJMC has been excluded from the purview of the Act.

19. First, the mere fact that an establishment or factory belongs to or is under the control of the Government would not. make the Act inapplicable. It would have to be established that such establishment or. factory was granting substantially similar or superior benefits. The Act provides for the various benefits available to the insured person. These include not only the benefits such as sickness benefit, maternity benefit and disablement benefits to the insured person but also payments to dependants of the insured person who dies as a result of an employment injury as well as funeral expenses of the insured person.

20. The corporation as constituted is a representative body and includes workers. Theoretically speaking, it cannot be said that the benefits conferred by the Act are not superior to the ones granted by the NJMC's Medical Treatment and Attendance Rules whatever it may be in practice.

21. In the second place, there can be no doubt that the employees have not treated NJMC as being equivalent to the Government. That the Act was applied to NJMC would appear from Clause 3(b)(iv) of the NJMC's Medical Treatment and Attendance Rules. The respondents' submission that the petitioners' case in the writ petition proceeded on the basis that the Act was applicable to NJMC is well founded, As a matter of fact even the representation made by the petitioners to the Governmental authority as well as to the NJMC immediately prior to the moving of the writ petition proceeds on the basis (hat NJMC was covered under the Employees' State Insurance Act.

22. In the third place the memorandum dated November 26, 1990, January 3, 1991, issued by the Ministry of Labour, reads as follows:

'The undersigned is directed to say that the Employees' State Insurance Act was amended in 1989 and factories/establishments belonging to or under the control of the Government, whose employees are otherwise in receipt of benefits provided under the Act have been specifically excluded from the purview of the Act. This amendment has been brought into force with effect from October 20, 1989. The factories/establishments belonging to the Central Government which were previously granted exemption under this Ministry' s Notification No. S.O.1056, dated October 30, 1988 (copy enclosed), or any other similar notification on the ground that their employees were in receipt of benefits substantially similar to the benefits provided under the Employees' State Insurance Act, thus now stand excluded from the purview of the Act. These factories/establishments need not, therefore, approach this Ministry in future, for continuance of their exemption. It may, however, kindly be noted that only departmental undertakings under the Government, i.e., those factories/establishments whose employees are Government servants, stand excluded and the Act continues to be applicable to all the public sector undertakings/corporations, autonomous bodies, etc. The Ministry of Agriculture, etc. are requested to bring this to the notice of all the concerned subordinate formations under them.'

23. The proviso to Section 1(4) was added by amendment of the Act in 1980. This contemporaneous exposition by the Ministry of Labour of the scope of the proviso is a very useful and relevant guide to resolve the ambiguity, if any, in the proviso (see Keshavji Ravji and Co. v. C.I.T. : [1990]183ITR1(SC) ).

In the fourth place NJMC is a company incorporated under the Companies Act, 1956. Under Section 86-A of the Act, offences by companies have been made punishable. The word 'company' for the purposes of that section means 'any body corporate' and no distinction has been drawn between the body corporate, the shares of which are held by private individuals and a body corporate, the shares of which are held by the President of India. A person can be made liable for default only if he is in a position to do the act, the default of which is punishable. A position to do the act connotes control and responsibility. Applying this logic, NJMC would be liable for a default under the Act only because it is in a position to implement or control. It would follow that the establishments of NJMC are under the control of NJMC and not of the Government

24. There is no warrant either on the language of the statute or on any authority or on the basis of any principle of construction to equate NJMC with the Government for the purposes of the Act.

25. It is immaterial for the purposes of the Act that the majority of the shares of NJMC are held by the President of India. A shareholder does not own the assets of the company.

26. In Mrs. Bacha F. Guzdar v. CIT, : [1955]27ITR1(SC) , the Supreme Court held:

'A shareholder has got no interest in the property of the company though he has undoubtedly a right to participate in the profits if and when the company decides to divide them. The interest of a shareholder 'vis-a-vis' the company was explained in the Sholapur Mills' case--'Charanjit Lal v. Union of India', : [1950]1SCR869 . That judgment negatives the position taken up on behalf of the appellant that a shareholder has got a right in the property of the company. It is true that the shareholders of the company have the sole determining voice in administering the affairs of the company and are entitled, as provided by the articles of association, to declare that dividends should be distributed out of the profits of the company to the shareholders but the interest of the shareholder either individually or collectively does not amount to more than a right to participate in the profits of the company.

27. The company is a juristic person and is distinct from the shareholders. It is the company which owns the property and not the shareholders...'

28. Thus, control and ownership of the establishment are in NJMC. It may be that for the purposes of Article 12, NJMC may be treated as 'State' or other authority but this does not mean that the corporate entity of NJMC can be disregarded for the purposes of the Act.

29. It cannot be disputed that the law as it now stands is that employees of a public sector company are not civil servants or Government employees.

30. No doubt the Supreme Court has in the case of K.C.P.E. Association, (supra), as well as in Girdhar and Sons, (supra), emphasised the need to read a statute in the light of the object sought to be achieved by the enactment. In fact in K.C.P.E. Association's case, (supra) the Supreme Court has held that in matters of industrial law the benefit of reasonable doubt should go to the labour. The Tribunal in that case was directed to dispose of the case taking a compassionate approach but without overstepping the proved facts and to the extent justified by the Act.

31. I do not see that by holding that NJMC is not outside the purview of the Act any inherent prejudice is being caused to the employees of the NJMC. The difference between the factories/establishments owned by the Government and the public sector undertakings like NJMC is a distinction without any real difference. In the first case, there is a continuous statutory exemption under Section 1(4), provided that the pre-conditions are fulfilled. In the second case, the exemption granted by the Government under Section 87 is for a specific period and renewed from time to time. The renewal of the exemption under Section 87 and the continuation of the exemption under the proviso to Section 1(4) of the Act are both dependent upon the enjoyment of benefits similar or superior to the benefits granted under the Act.

32. There is also substance in the submission of the respondents that the petitioners had not challenged the application of the Employees' State Insurance Act to the employees of NJMC and were only aggrieved by the extension of the Act to employees earning up to Rs. 3,000, if the benefits available under the Act are not inferior to the benefits available under the Medical Treatment and Attendance Rules of NJMC for employees earning up to Rs. 1,600 per month, (being the earlier level of application of the Employees' State Insurance Act) is not understood how the same benefits become Inferior for the purpose of employees earning above Rs. 1,600. In fact, many of the employees at the head office of the National Unit of NJMC had been receiving benefits under the Employees' State Insurance. No grievance had been raised by any employee nor any Union of NJMC regarding this application at any stage. The mere fact of the extension of the provisions of the Employees' State Insurance to employees earning up to Rs. 3,000 would not make the benefits received by the employees from the NJMC (sic).

33. Nor can it be said that by limiting the operation of the Act to persons drawing salaries of Rs. 3,000 per month, there has been any violation of Article 14.

34. In Basant Kumar Sarkar v. Eagle Rolling Mills Ltd., (supra), the Supreme Court said: (p.108)

'In the very nature of things, it would have been impossible for the Legislature to decide in what areas and in respect of which factories the Employees' State Insurance Corporation should be established. It is obvious (hat a scheme of this kind, though very beneficent, could not be introduced in the whole of the country all at once. Such beneficial measures, which need careful experimentation, have, some times, to be adopted by stages and in different phases, and so, inevitably, the question of extending the statutory benefits contemplated by the Act has to be left to the discretion of the appropriate Government.'

35. There has been no change in the conditions of service of the employees. It is the admitted case that the Employees' State Insurance Act was applicable to the employees of NJMC albeit at a lower level of pay, even before 1980. It is also admitted that from time to time the level was increased. In other words, the terms and conditions of service did not envisage the exclusion of the applicability of the Employees' State Insurance Act for all times to come.

36. The argument that by Clause 17 of the 1989 memoranda of settlement, the medical benefits as obtaining in 1989 were frozen is unacceptable. As far as these employees of NJMC are concerned, the medical benefits obtaining in 1989 were, according to them, under the Medical Treatment and Attendance Rules. But these Rules expressly exclude the employees who are governed by the Act. This does not mean as contended by the petitioners, that only employees who were governed by the Act in 1982 would be excluded from the application of the Rules nor does it mean that persons governed by the Rules in 1982 would never be subject to the Act. The word 'are' has been used in a continuous sense. In other words, the persons who at any time may be governed by the Act would be excluded from the operation of the Rules. This would be clear from the use of the word 'are' in other places in Clause 3 of the Rules. For example, Clause 3(b)(v) provides for exclusion of employees of NJMC who 'are on deputation abroad'. It would be absurd to read the word 'are' in Sub-clause (v) as permanently excluding the employees from the Rules who may have been on leave or on deputation in 1982.

37. There may be various reasons why the employees prefer to avail of medical facilities not controlled by the Act. It is not for this Court to speculate. But, at the same time, it cannot be that the court will accept the employees' saying so, without more.

38. The discretion to exempt is that of the Government. The court will not usurp the functions granted by the Legislature solely to the Government (See Dena Nath v. National Fertilisers Ltd., (1992-I-LLJ-289), Veerappa Filial (G.) v. Roman and Raman Ltd., : [1952]1SCR583 , Chingleput Bottlers v. Majestic Bottling Co., : [1984]3SCR190 , and Chairman, United India Fire and General Insurance Co. Ltd. v. K.S. Viswanathan, : (1985)IILLJ580SC .

39. In the case of Basant Kumar, (supra) a notification had been challenged, which sought to bring employees of certain companies under the Act. The main grievance was that the petitioners were already getting satisfactory medical benefits of a very high order free of charge. The main grievance of the petitioners was that as a result of the notification they would have to be content with medical benefits of a less satisfactory nature. The Supreme Court was of the view that this was a question which should be determined under Section 10 of the Industrial Disputes Act or if possible under Section 74 or 75 of the Act and not under Article 226.

40. The case of L. Robert D' Souza v. Executive Engineer, Southern Railway, (supra), cited by the petitioner as an authority for the proposition that the court under Article 226 can directly give relief without insisting on determination by the Industrial Dispute Tribunal is not in fact an authority for the proposition contended. The issue was neither raised nor decided.

41. There can be no dispute that if it is the admitted case that employees are already receiving superior or similar benefits from the employers, the discretion under Section 87 is coupled with the duty to grant the exemption from the application of the Act. The only question is, therefore, whether the employees are indeed in receipt of superior or similar benefits?

42. The argument of Section 72 proceeds on the basis that the benefits are, in fact, being reduced. In my view, the argument is premature and should be decided by the appropriate Government in disposing of the application under Section 87.

43. In my view, the petitioners' conduct in moving the writ application without giving the authorities a chance of considering, let alone complying with, their representation is to be deprecated. The representation to the Government raised the issue of superior benefits under NJMC Medical and Attendance Rules, 1982, for the first time. The representations were sent by registered post. Without even waiting for acknowledgement of receipt, the writ application was prepared, affirmed and moved. The matter might have been resolved governmentally had the petitioners waited even for a reasonable time. As it is for the reasons stated earlier, the matter is being remandedack for considering by the Government under Section 87.

44. I am also not convinced that any prejudice will be suffered by the employees if the Act as made applicable to them in the meantime and the interim orders are not continued. But this observation should also not be construed as an evaluation of the relative benefits under the Act and NJMC's Medical Rules.

45. I, therefore, dispose of the writ application by directing the Central Government to consider and dispose of the representation made by the petitioners dated April 30, 1992, under the provisions of Section 87 of the Act after giving the petitioners, NJMC and the Employees' State Insurance Corporation an opportunity of being heard, within a period of three months from the date of service of the operative portion of this judgment.

46. There will be no order as to costs.

47. All parties are to act in a signed copy of the operative portion of this judgment in the usual undertaking.