2001 (3) TMI 1018 - SC - Indian Laws

Issues Involved:
1. Legality of the 1976 and 1977 schemes.
2. Constitutionality of the 1985 Amendment Act.
3. Applicability of the Industrial Disputes Act to GIC employees.
4. Validity of retrospective effect given to the 1985 Amendment Act.
5. Discrimination against GIC employees.
6. Procedural fairness and collective bargaining rights.

Summary:

1. Legality of the 1976 and 1977 Schemes:
The Petitioners contended that the schemes of 1976 and 1977 were "ultra vires" the Nationalisation Act of 1972, as decided in Ajay Kumar Banerjee's case. The schemes were void "ab initio" and could not be revived by giving retrospective effect to the Amendment Act of 1985. However, the court held that the amendments were made while the process of rationalization of pay scales and other service conditions were still in progress and had not been finally completed.

2. Constitutionality of the 1985 Amendment Act:
The Petitioners argued that the 1985 Amendment Act was unconstitutional, violating Articles 14, 19, and 21 of the Constitution. It conferred unreasonable and unguided power on the Central Government to frame schemes affecting the conditions of service of the workmen without any scope for collective bargaining. The court rejected these contentions, stating that the legislature has the power to enact laws retrospectively to overcome judicial decisions, and such retrospective effect is not violative of Articles 14, 19, and 21.

3. Applicability of the Industrial Disputes Act to GIC Employees:
The Petitioners contended that the Industrial Disputes Act should apply to GIC employees, and the view taken by the Industrial Tribunal in its award dated 1.8.1980 in ID No.17 of 1980 is liable to be reversed. The court rejected this contention, stating that the exclusion of the Industrial Disputes Act does not affect the right to collective bargaining and is justified in the larger interest of the insurance business.

4. Validity of Retrospective Effect Given to the 1985 Amendment Act:
The Petitioners argued that the retrospective effect given to the 1985 Amendment Act with effect from 2.1.1973 is arbitrary and violates Articles 14, 19, and 21 of the Constitution. The court held that the legislature is competent to make laws retrospectively, and the retrospective effect given to the Amendment Act is to overcome the difficulty pointed out by the court in Ajay Kumar Banerjee's case.

5. Discrimination Against GIC Employees:
The Petitioners contended that the Act makes discrimination vis-à-vis the amendments to the Schemes made in 1976 and 1977 by specifically excluding the 1980 Scheme from the retrospective operation given to the 1985 Act. The court found no substance in this argument, stating that the rationalization of pay scales and service conditions was necessary to achieve uniformity and inter-se rationalization in terms and conditions of service of different categories of employees of merged companies.

6. Procedural Fairness and Collective Bargaining Rights:
The Petitioners argued that the exclusion of the Industrial Disputes Act affects their rights under Article 19(1)(c) of the Constitution and thereby their right to collective bargaining. The court held that the right to form a union is still available under Article 19(1)(c) of the Constitution, and collective bargaining is not barred. The exclusion of the Industrial Disputes Act is justified in the larger interest of the insurance business.

Conclusion:
The court dismissed the petitions, holding that the amendments and schemes were valid and justified. The retrospective effect given to the 1985 Amendment Act was necessary to overcome the judicial decision in Ajay Kumar Banerjee's case, and the exclusion of the Industrial Disputes Act does not affect the right to collective bargaining. The court found no violation of Articles 14, 19, and 21 of the Constitution.

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