Case Note & Summary
The case concerned challenges to a Central Government order accepting recommendations of a Wage Board constituted under the Working Journalists (Conditions of Service) and Miscellaneous Provisions Act, 1955. The Press Trust of India (P.T.I.) and Indian National Press (Bombay) Ltd. filed writ petitions and an appeal, alleging that the order violated Articles 14, 19 and 21 of the Constitution. The Wage Board had classified newspaper establishments, including news agencies, into seven classes based on gross revenue for accounting years 1963 to 1965. P.T.I., a national news agency with gross revenue below Rs 100 lakhs, should have been placed in Class III, but was placed in Class II citing its status as a national news agency serving top class papers. The Wage Board estimated a recurring annual burden of Rs 6.78 lakhs on P.T.I., while its average profit was Rs 3.67 lakhs. Indian National Press was placed in an appropriate class but still challenged the order. The Union of India raised preliminary objections that the appeal was not maintainable under Article 136 because the statutory order was subordinate legislation, not a judicial order, and that a limited company could not claim Article 19 rights. The court permitted substitution of a shareholder as second petitioner because the heavy financial burden affected shareholders' interests. On merits, the court held that while classification between newspapers and news agencies was permissible due to different functions, income sources and services, singling out P.T.I. for Class II without applying the Board's own gross revenue criteria was arbitrary and discriminatory under Article 14. The court followed Express Newspapers v. Union of India and held that Section 10 required the Wage Board to ascertain the employer's financial capacity; the burden of Rs 6.78 lakhs far exceeded average profits, and the Board's assumption that P.T.I. could increase subscriptions was insufficient. The court also found that the Wage Board recommended wages higher than those demanded by the employees, denying the employer an opportunity to meet the claim, which made the procedural restriction unreasonable under Article 19. Accordingly, the Supreme Court struck down the Central Government order insofar as it concerned P.T.I., directed P.T.I. to pay wages agreed with its employees from the date they were payable under the Wage Board recommendations until refixation by another Wage Board, and dismissed the Indian National Press petition because it failed to show lack of capacity. The appeal and writ petition of P.T.I. were allowed; the writ petition of Indian National Press was dismissed.
Headnote
A) Constitutional Law - Article 14 - Classification of News Agencies - Constitution of India, Article 14; Working Journalists (Conditions of Service) and Miscellaneous Provisions Act, 1955, Section 10 - The Wage Board classified newspaper establishments on gross revenue but placed P.T.I. in Class II despite its gross revenue below Rs 100 lakhs, without giving reasons for departing from its own criteria. Court held that classification must be based on intelligible differentia and rational nexus; singling out P.T.I. as a national news agency was arbitrary and discriminatory. Held that the order violated Article 14 insofar as P.T.I. was placed in Class II rather than Class III (Paras 509-513). B) Labour Law - Wage Fixation - Capacity to Pay - Working Journalists (Conditions of Service) and Miscellaneous Provisions Act, 1955, Section 10 - Wage Board required to consider employer's financial capacity before fixing wages. P.T.I.'s estimated recurring burden of Rs 6.78 lakhs exceeded its average profit of Rs 3.67 lakhs, and Board's assumption that P.T.I. could increase subscriptions was insufficient. Held that failure to properly consider capacity to pay rendered recommendations unreasonable and violative of Section 10 (Paras 514-515). C) Administrative Law - Procedural Fairness - Recommendation Exceeding Employee Demand - Working Journalists (Conditions of Service) and Miscellaneous Provisions Act, 1955, Section 10; Constitution of India, Article 19 - Board awarded wages higher than those demanded by employees, denying employer a fair opportunity to contest the higher claim. Court held procedural safeguard of representation under Section 10 was breached, making restrictions on Article 19 rights unreasonable. Held that recommendations in excess of employee demand and beyond capacity were arbitrary (Paras 517-518). D) Constitutional Law - Article 19 - Shareholder's Right to Challenge - Constitution of India, Article 19(1)(f) - A shareholder could challenge an order imposing heavy financial burden on company resources, as it affected their fundamental rights. Court allowed substitution of shareholder as second petitioner to prevent prolonging litigation. Held that substitution was permitted in interest of justice (Paras 506-507).
Issue of Consideration
Whether the Central Government's order accepting Wage Board recommendations violated Articles 14, 19 and 21; whether the Wage Board failed to consider P.T.I.'s capacity to pay under Section 10; whether the Board exceeded jurisdiction by recommending wages higher than demanded; whether a shareholder could be substituted to assert Article 19 rights; maintainability of appeal under Article 136.
Final Decision
The Supreme Court allowed the writ petition and appeal of P.T.I., struck down the Central Government order dated October 27, 1967 insofar as it concerned P.T.I., and directed P.T.I. to pay wages agreed between it and its employees from the date wages were payable under the Wage Board recommendations until refixation by the Central Government on recommendations of another Wage Board. The writ petition of Indian National Press was dismissed.
Law Points
- Classification based on intelligible differentia and rational nexus
- capacity to pay mandatory under Section 10 of Working Journalists Act
- procedural fairness in wage fixation
- Article 14 equality
- Article 19 reasonableness of restrictions
- shareholder's right to challenge
