Supreme Court of India
THE SECURITY ASSOCIATION OF INDIA & ANR.versusUNION OF INDIA & ORS.
- Citation
- 2014 INSC 331
- Decided
- 25 April 2014
- Disposal
- Disposed off
- Bench
- GYAN SUDHA MISRA
Holding
The two Acts occupy distinct fields— the Central Act regulates private security agencies, while the State Act regulates labour‑welfare of security guards—so there is no repugnancy and both may operate concurrently.
Summary
The Security Association of India and other private security agencies challenged the Maharashtra Private Security Guards (Regulation of Employment & Welfare) Act, 1981 on the ground that it was repugnant to the Private Security Agencies (Regulation) Act, 2005 and violated Articles 14 and 19(1)(g) of the Constitution. The appellants argued that the Central Act, being a complete code, should supersede the State Act and that Section 23 of the State Act made the operation of private security agencies contingent on state‑granted exemptions. The Court examined the pith and substance of both statutes, the entries under List‑III and List‑I of the Seventh Schedule, and the doctrine of occupied field. It held that the Central Act regulates the business of private security agencies, while the State Act deals with labour‑welfare matters of security guards, and therefore the two statutes operate in different fields with only incidental overlap. Consequently, there is no direct or irreconcilable conflict; the State Act is not repugnant, and the restrictions it imposes are reasonable under Articles 14 and 19. The appeals and the related contempt petitions were dismissed.
Issues considered
- Whether the Maharashtra Private Security Guards (Regulation of Employment & Welfare) Act, 1981 is repugnant to the Private Security Agencies (Regulation) Act, 2005.
- Whether the State Act violates Articles 14 and 19(1)(g) of the Constitution.
- Whether the Central Act occupies the field of labour welfare, thereby rendering the State Act inoperative.
- Whether the two Acts can coexist and operate concurrently.
Legislation cited
- Constitution of Indias. Art. 14, s. Art. 19(1)(g), s. Art. 200, s. Art. 246, s. Art. 248, s. Art. 254
- Maharashtra Private Security Guards (Regulation of Employment & Welfare) Act, 1981
- Maharashtra Private Security (Regulation of Employment & Welfare) Scheme, 2002
- Private Security Agencies (Regulation) Act, 2005
Subjects
repugnancyconcurrent legislationcentral vs state lawprivate security agencieslabour welfareconstitutional validityArticles 14, 19, 246, 254licensingexemptionScheme 2002occupied field doctrine
Judgment
[2014] 9 S.C.R. 880
A THE SECURITY ASSOCIATION OF INDIA & ANR.
v.
UNION OF INDIA & ORS.
· (Civil Appeal No. 8814 of 2011)
APRIL 25, 2014
B
[GYAN SUDHA MISRA AND
PINAKI CHANDRA GHOSE, JJ.]
Constitution of India, 1950 - Arts. 246 and 254 and
C Seventh Schedule, List Ill - Issue pertaining to repugnancy
of the State Act in light of the Central Act - When arises -
Held: Only if it is found that the two enactments cover the same
matter substantially and there is a direct and irreconcilable
conflict between the two, the issue of repugnancy arises.
D
Private Security Agencies (Regulation) Act, 2005 -
Maharashtra Private Security Guards (Regulation of
Employment & Welfare) Act, 1981 - Question of repugnancy
of the 1981 State Act in light of the 2005 Central Act -
E Whether after enactment of the 2005 Central Act by the
Parliament, the 1981 State Act is not applicable to the private
security agencies - Held: The subject matter of the two Acts
in question are substantially different - The two Acts operate
in different fields and there is only incidental connection
F between the two regarding the regulation of private security
agencies - The 2005 Central Act does not occupy the field
of labour welfare and thereby there cannot be any conflict
between the 1981 State Act and the 2005 Central Act - There
is no repugnancy between the 1981 State Act and the 2005
Central Act-in the given facts.
G
Maharashtra Private Security Guards (Regulation of
Employment & Welfare) Act, 1981 - Challenge to - On
ground of being violative of Arts. 14 and 19 of the Constitution
- Held: Not tenable - Restrictions imposed by the Act are
H 880
SECURITY ASSOCIATION OF INDIA v. UNION OF 881
INDIA
reasonable restrictions envisioned by the Constitution and A
protect the rights and ensure the welfare of private security
guards engaged by private security agencies by means of
s. 23 and relevant provisions of the Scheme of 2002 - The
Act does not violate Articles 14 and 19 or any other
Fundamental Rights contained in the Constitution - B
Maharashtra Private Security (Regulation of Employment and
Welfare) Scheme of 2002.
Interpretation of Statutes - Presumption towards
constitutionality of a Statute -Held: Courts should proceed to
construe a Statute with a view to uphold its constitutionality. C
Dismissing the appeals and disposing of the
contempt petitions, the Court
HELD:1.1. Prior to determining whether there is any o
repugnancy or not, it has to be determined that the State
Act and the Central Act both relate to the same entry in
List-Ill and there is a 'direct' and irreconcilable' conflict
between the two. i.e. both the provisions cannot stand
together. Only if it is found that the two enactments cover E
the same matter substantially and there is a direct and
irreconcilable conflict between the two, the issue of
repugnancy arises. [Paras 46, 47] [912-C, E-F]
1;2. In the case at hand, the subject matters of the
two Acts in question, viz. the Private Security Agencies F
(Regulation) Act, 2005 (the Central Act) and the
Maharashtra Private Security Guards (Regulation of
Employment & Welfare) Act, 1981 (the State Act) are
substantially different and the conflict in the operation of
the two Acts is incidental. Both the Acts operate in G
different fields and there is only incidental connection
between the two regarding the regulation of private
security agencies. The two statutes occupy distinct
fields. There is no repugnancy between the State Act and
the Central Act in the given facts. The Central Act does H
882 SUPREME COURT REPORTS [2014] 9 S.C.R.
A not occupy the field of labour welfare and thereby there
cannot be any conflict between the State Act and the
Central Act. The question of applicability of the Central
Act and the State Act apply concurrently. [Paras 50, 52
and 55] [913-F-G; 916-E-F; 918-G]
B
Welfare Association, A.R.P., Maharashtra & Anr. vs.
Ranjit P. Gohil & Ors. 2003 (2) SCR 139 = (2003) 9 SCC
358; State of Andhra Pradesh vs. K. Purushottam Reddy &
Ors. 2003 (2) SCR 832 = (2003) 9 SCC 564; State of Gujarat
C vs. Mirzapur Moti Kureshi Kassab Jamat & Ors. 2005 (4)
Suppl. SCR 582 = (2005) 8 SCC 534; State of MP vs .
. Rakesh Kohli & Anr. 2012 (6) SCR 661 = (2012) 6 SCC 312;
Offshore Holding Pvt. Ltd vs. Bangalore Development
Authority & Ors. 2011 ~1) SCR 453 = (2011) 3 SCC 139;
State of West Bengal vs. Kesoram Industries & Ors. 2004 (1)
D SCR 564 = (2004) 10 SCC 201; Deep Chand vs. State of
Uttar Pradesh & Ors. . 1959 Suppl. SCR 8 =AIR 1959 SC
648; Hoechst Pharamaceuticals Ltd & Ors. vs. State· of Bihar
& Ors. 1983 (3) SCR 130: (1983) 4 SCC 45; M. Karunanidhi
vs. Union of India & Anr. 1979 (3) SCR 254 = (1979) 3 SCC
E 431; Government of Andhra Pradesh & Ors vs. J.B.
Educational Society & Anr. 2005 (2) SCR 302 = (2005) 3
SCC 212; Vijay Kumar Sharma & Ors. vs. State of Kamataka
& Ors. 1990 (1) SCR 614 = (1990) 2 SCC 562; State of Uttar
Pradesh & Anr. vs. Synthetics and Chemicals Ltd. & Anr.
F (1991) 4 SCC 139 and State of Bihar & Ors. vs. Shree
Baidyanath Ayurved Bhawan (P.) Ltd. & Ors. 2005 (1)
SCR 334 = (2005) 2 sec 762 - relied on.
Mis Tradesvel Security Services vs. State of Maharashtra
G 1982 Born LR Vol. LXXXIV 608 - appr.oved.
In re Special Reference No. 1 of 2000, 2004 (3)
SCR 534 = (2004) 4 SCC 489; Security Guards Board for
GreaterBombay and Thane District vs. Security & Personnel
Services Pvt. Ltd. & Ors. 1987 (3) SCR 19 : (1987) 3 SCC
H 413; Maharashtra Suraksha Rakshak Aghadi vs. State of
SECURITY ASSOCIATION OF INDIA v. UNION OF 883
INDIA
A
Maharashtra; State of Punjab vs. Labour Court, Jallundhar &
Ors.1980 (1) SCR 953 : (1980) 1 SCC 4; Premier
Automobiles Ltd. vs. Kamlekar Shantaram Wadke of Bombay
& Ors.1976 (1) SCR 427 :(1976) 1 SCC 496; Krantikari
Suraksha Rakshak Sanghatana vs. Bharat Sanchar Nigam
Limited & Ors. 2008 (1.2) SCR 649 : (2008) 10 SCC 166; B
Bharathidasan University & Anr. vs. All India Council for
Technical Education & Ors. 2001 (3) Suppl. SCR 253 :
(2001) 8 SCC 676; State of West Bengal & Ors. vs.
Committee for Protection of Democratic Rights of West Bengal
& Ors. 201 o (2) SCR 979 = (201 O) 3 ·sec 571; State of C
Maharashtra vs. Sant Dnyaneshwar Shikshan Shastra
Mahavidya/aya & Ors. 2006 (3) SCR 638 = (2006) 9 SCC
1; Thirumuruga Kirupananda Variyar Thavathiru Sundara
Swamiga/ Medical Educational & Charitable Trust vs. State
of Tamil Nadu & Ors. 1996 (2) SCR, 422 = (1996) 3. SCC D
15; H.S. Srinivasa Raghavachar & Ors vs. State of Karnataka
& Ors. 1987 (2) SCR 1189 = (1987) 2 SCC 692; State of
Kera/a & Ors. vs. Mar Appraem Kuri Company Limited & Anr.
2012 (4) SCR 448 = (2012) 7 SCC 106; P. V. Hemlatha v.
Kattamkandi Puthiya Maliacka/ Saheeda, 2002 (3) E
SCR 1098 = (2002) 5 SCC 548; Ashoka Marketing Ltd. &
Anr vs. Punjab National Bank & Ors. 1990 (3) SCR 649 =
(1990) 4 SCC 406; Zaverbhai Amaidas vs. State of Bombay
(1955] 1 SCR 799; State of Orissa vs. M.A. Tulloch and Co.
(1964] 4 SCR 461; K.P. Varghese vs. Income Tax Officer F
1982 (1) SCR 629 = (1981) 4 SCC 173; State of Tamil Nadu
vs. Mahi Traders & Ors. 1989 (1) SCR 445 = (1989) 1 SCC
724; Sanjeev Coke Manufacturing Company vs. Mis Bharat
Coking Coal Ltd. & Anr. 1983 (1) SCR 1000 = (1983) 1 SCC
147; NDMC Vs. State of Punjab & Ors. 1996 (10) Suppl. G
' SCR 472 = (f997) 7 SCC 339; Pathumma & Ors vs. State
of Kera/a & Ors. 1978 (2) SCR 537 = (1978) 2 SCC 1; Rajiv
Sarin & Anr. vs. State of Uttarakhand & Ors. 2011 (9)
SCR1012= (2011) 8 SCC 708; Gram Panchayat vs.
H
884 SUPREME COURT REPORTS [2014] 9 S.C.R.
A Ma/winder Singh & Ors. (1985) 3 SCC 661; Gimar Traders
vs. State of Maharashtra & Ors. 2011 (3 ) SCR 1. = (2011) 3
SCC 1, State of Rajasthan vs. Vatan Medical &,General Store
& ors. 2001 (2) SCR 729 = (2001) 4 sec 642; K. K.
Bhaskaran vs. State 2011 (3) SCR 527 = (2011) 3 SCC
B 793; H. C. Narayanappa & Ors. vs. State of Mysore & Ors.
1960 SCR 742 =AIR 1960 SC 1073; Khoday Distilleries Ltd
& Ors. vs. State of Karnataka & Ors. 1994 (4) Suppl. SCR
477 = (1995) 1 sec 574 - referred to.
C Maharashtra ({ajya Suraksha Rakshak and General
Kamgar Union and Ors. vs. State of Maharashtra and Ors.
(1994) lllLLJ 946 Born; and Krantikari Suraksha Rakshak
Sanghatana vs. State of Maharashtra & Ors. 2006 (6) ALL
MR 401 - referred to.
D Canadian Western Bank vs. Alberta [2007] Canadian
S.C.R. 3 - referred to.
Case Law Reference:
1982· Born LR Vol. LXXXIV 608 approved Para 3
E
1987 (3) SCR 19 referred to Para 5
1980 (1) SCR 953 referred to Para 14
1976 (1) SCR 427 referred to Para 14
F 2008 (12) SCR 649 referred to Para 14
2001 (3) Suppl. SCR 253 referred to Para 15
1983 (3) SCR 130 relied on Para 17
G 2005 (2) SCR 302 relied on Para 17
2010 (2) SCR 979 referred to Para 17
2006 (3) SCR 638 referred to Para 17
1996 (2) SCR 422 referred to Para 18
H
SECURITY ASSOCIATION OF INDIA v. UNION OF 885
INDIA
1987 (2) SCR 1189 referred to Para 22 A
2012 (4) SCR448 referred to Para 23
2002 (3) SCR 1098 referred to Para 24
1990 (3) SCR 649 referred to Para 24
B
[1955] 1 SCR 799 • referred to Para 24
1959 Suppl. SCR 8 relied on Para 24
[1964] 4 SCR 461 referred to Para 24
1982 (1) SCR 629
c
referred to Para 24
1989 (1) SCR 445 referred to Para 24
1983 (1) SCR 1000 referred to Para 30
1996 (10) Suppl. SCR 472 referred to Para 30 D
2005 (4) Suppl. SCR 582 relied on Para 31
1978 (2) SCR 537 referred to Para 31
2011 (9) SCR 1012 referred to Para 31 E
(1985) 3 sec 661 referred to Para 31
2011 (1) SCR 453 relied on Para 32
2011 (3)_ SCR 1 referred to Para 32
F
c2011) 3 sec 1 referred to Para 32
2001 (2) SCR 729 referred to Para 32
2005 (1) SCR 334 relied on Para 32
G
2011 (3) SCR 527 referred to Para 33
1979 (3) SCR 254 relied on Para 33
1990 (1) SCR 614 relied on Para 33
H
886 SUPREME COURT REPORTS [2014] 9 S.C.R. _
A 1960 SCR 742 referred to Para 35
1994 (4) Suppl. SCR 477 referred to Para 35
[2007] Canadian S.C.R. 3 referred to Para 39
B 2003 (2) SCR 139 relied on Para 44
2003 (2) SCR 832 relied on Para 45
2012 (6) SCR 661 relied on Para 45
2004 (1) SCR 564 relied on Para 47
c
2004 (3) SCR 534 referred to Para 48
(1991) 4 sec 139 relied on Para 55
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
D 8814 of 2011.
From the Judgment & Order dated 14.08.2009 in WP No.
1804/2007 of the High Court of Bombay.
WITH
E
C.A. No. 8670, 8671, 8673, 8709/2011.
Contempt. Pet. (C) No. 268 of 2010 in Contempt Petition
(C) No. 68 of 2010.
F Contempt Pet. (C) No. 68 of 2010 in C.A. No. 8814 of
2011, C.A. No. 4889 of 2014.
J.P. Cama, C.U. Singh, J.S. Attri, Krishnan Venugopal,
Anand Grover, Sumit Goel, Shashank, Aditya Sharma, R.D.
G Suvarna (Parekh & Co.), Meenakshi Chattarji, Ashish Jha
("Coac"), Ashok Mathur, R. Sudhinder, Sunita Sharma, Manita
Verma, B.K. Prasad, S.N. Terdal, Priyanka Bharihoke, Aparna
Bhat, Parul Kumari, Gopal Singh, Devvrat, Vimal Chandra S.
Dave, 'Amardev J. U11Jiyal, Udai V.S. Rathore, A. Ragbunath,
H Ramesh K. Mishra, Krishna Kr. Singh, Rohit Kumar Singh,
SECURITY ASSOCIATION OF INDIA v. UNION OF 887
INDIA [PINAKI CHANDRA GHOSE, J.]
Uday B. Dube, Mihir Samson, Asha Gopalan Nair, Jayesh A
Kanaksinh Ashar for the appearing parties.
The Judgment of the Court was delivered by
PINAKI CHANDRA GHOSE, J. 1. Leave granted in
Special Leave Petition (Civil) No.8979 cif 2013. B
2. The present batch of appeals has arisen from the
common judgment and order dated 14th August, 2009 passed
by the High Court of Judicature at Bombay in a batch of writ
petitions being Writ Petition Nos. 1804 of 2007, 64 of 2004, c
2316 of 2008 and 200 of 2008.
3. The High Court by means of the common impugned
judgment disposed of the writ petitions filed by various security
agencies which claimed that after enactment of the Private
Security Agencies (Regulation) Act, 2005 (hereinafter referred D
to as the "Central Act") by the Parliament, the Maharashtra
Private Security Guards (Regulation of Employment & Welfare)
Act, 1981 (hereinafter referred to as the "State Act") is nol
applicable to the private security agencies and if the State Act
remains in operation with respect to private security agencies E
then the State Government be directed to expeditiously pass
orders on the pending applications for exemption under the
provisions of the State Act as allowed under Section 23 of the
State Act. The High Court found the State Act to be in
consonance with the Central Act and directed the State F
Government to pass orders on the applications for exemption
or applications for renewal o1 exemption filed by the security
agencies.
4. As the present appeals challenge the validity of a State G
Act in light of a Central Act, the legislative history of the same
has to be examined in the light of the current facts. The State
Act which came into force on June 29, 1981 received the
Presidential assent envisaged under Article 200 of the
Constitution of India on September 24, 1981. Under the said H
888 SUPREME COURT REPORTS (2014] 9 S.C.R.
A Act, the Maharashtra Private Security Guards (Regulation of
Employment and Welfare) Scheme, 1981 (hereinafter referred
to as 'Scheme of 1981 ') was put into place. The constitutional
validity of the State Act was challenged before the Bombay
High Court in Mis Tradesve/ Security Services vs. State of
B Maharashtra 1 and the High Court vide its order dated
November 2, 1982 upheld the Act on the ground of it being a
complete Code and allowed exemptions under Section 23 at
initial stage only. The matters came before this Court as special
leave petitions which were dismissed in 1983 and the Scheme
c of 1981 was stayed with a direction to the State Government
to dispose of all the applications for exemptions and the same
order was subsequently modified directing that the scheme be
brought into force.
5. The State Government duly considered and rejected all
D the applications and twenty five writ petitions were filed before
the High Court challenging the rejection by the State
Government. These writs were dismissed and the Division
Bench while disposing of the appeals arising therefrom, vide
order dated July 11, 1985 stated that the applications were
E rejected as a result of a policy decision not to grant exemption
and the same is incorrect, therefore it was directed that the
exemption applications be considered afresh on a case by
case basis. Against the same, the Security Guards Board
constituted under Section 6 of the State Act, filed special leave
F petitions before this Court. The said special leave petitions
were disposed of in term of the order passed by this Court on
April 28, 1987 in Security Guards Board for Greater Bombay
and Thane District vs. Security & Personnel Services Pvt. Ltd.
& Ors. 2, holding that the State Act being a welfare statute is
G enacted to prevent exploitation, that exemption is not for any
security guard but security guards working in factories or
establishments and the like and that agencies can also apply
for the same.
1. 1982 Born LR Vol. LXXXXIV 608.
H 2. (1987) 3 sec 413.
SECURITY ASSOCIATION OF INDIA v. UNION OF 889
INDIA [PINAKI CHANDRA GHOSE, J.]
6. The State Government vide Notification dated March 28, A
1990 under Section 23 of the State Act granted exemption to
security guards supplied by private security agencies without
any reference to a class or classes of factories. The said
Notification was challenged by the Trade Unions before the
High Court in Maharashtra Rajya Suraksha Rakshak and B
General Kamgar Union and Ors. vs. State of Maharashtra and
Ors. 3 . The High Court relying on the judgment of this Court in
Security Guards Board for Greater Bombay and Thane District
vs. Security & Personnel Services Pvt. Ltd & Ors. (supra) and
struck down the said Notification on the ground that exemption c
under Section 23 of the State Act can only be granted to security
guards in relation to a class or classes of factories and
establishments which were not mentioned in the Notification.
A Special Leave Petition was filed against the aforementioned
decision of the High Court and this Court issued directions that D
State Government should make certain clarifications by way of
amendments in the State Act
7. Subsequently, the State Act was amended by the
Maharashtra Private Security (Regulation of Employment and
Welfare) Amendment Act, 1996 and the amending Act explicitly E
stated that the amendments are clarificatory in nature. It must
be noted that the amendments to the State Act were challenged
in Krantikari Suraksha Rakshak Sanghatana vs. State of
Maharashtra & Ors 4 • and the Division Bench upheld the
amendments vide order dated October 10, 2006, and stated F
that the amendments only removed the ambiguities in the State
Act. In these backdrop facts arise Civil Appeal No. 8814 of
2011.
8. Appellant No.1 in this appeal is an Association of private G
security agencies (hereinafter referred to as the "Appellant
Association") whose members are engaged in the business of
employing training, outfitting and equipping security guards and
3. (rn94) lllLLJ 946 Born.
4. 2006 (6) ALL MR 401. H
-890 SUPREME COURT REPORTS [2014] 9 S.C.R.
A thereafter providing and/or supplying exempted security guards
to their clients/principal employers. Appellant No.2 is a member
of the Appellant Association.
9. Prior to January, 1997, some members of the Appellant
8 Association on application had obtained an exemption under
Section 23 of the State Act read with the Scheme of 1981 vide
a common Notification dated January 22, 1997 and amended
by Notification dated March 1, 1999. It has been claimed that
the agencies named in the Notification had sought renewal of
C exmeptions and that respondent No.6 being the State of
Maharashtra (hereinafter referred to as "respondent State")
failed and neglected to renew the said Notification, which led
to the filing of several writ petitions. Pursuant to the orders of
the High Court, tha members of the Appellant Association
continued to carry out their business.
D
10. In November 2002 the respondent State framed the
Maharshtra Private Security (Regulation of Employment and
Welfare) Scheme, 2002 (hereinafter referred to as 'Scheme of
2002'), replacing the Scheme of 1981. The Scheme of 2002
E was challenged in Maharashtra Suraksha Rakshak Aghadi vs.
State of Maharashtra in W.P. No.1085/2003 and upheld by the
Bombay High Court in the same writ by an order dated June
23, 2003. Subsequently, some of the members of the Appellant
Association, on application, obtained exemptions in respect of
F the security guards employed by them and deployed at the
establishments of tneir client/principal employers for a period
of three years each. Some of the notifications were to expire
in July, 2006 and some in 2007. Though all the concerned
agencies duly applied for renewal of exemption notifications,
G it has been alleged that the State Government wilfully and
deliberately delayed the consideration and decision on all such
applications for exemption.
11. The Parliament enacted the 'The Private Security
Agencies (Regulation) Act, 2005' (hereinafter referred to as tne ·
H
SECURITY ASSOCIATION OF INDIA v. UNION OF 891
INDIA [PINAKI CHANDRA GHOSE, J.]
"Central Act") which came into force on March 14, 2006. Under A
the provisions of the Central Act, the State of Maharashtra along
with other States were required to appoint the Controlling
Authority as contemplated under Section 3 thereof and frame
rules as contemplated under Section 25 of the Central Act.
However, it has been stated that the respondent State failed B
to appoint any Controlling Authority or frame rules, as a result
of which the members of the Appellant Association could not
obtain the requisite licences under the Central Act. Some of
the members of the Appellant Association, therefore, filed a writ
petition before the High Court in September, 2006, inter alia, C
praying for a direction to the respondent State for appointing
forthwith the Controlling Authority and framing the rules. Writ
Petition No.2633 of 2006 along with some other writ petitions
were disposed by the High Court as the writ petitioners did not
press the same when they learnt that the respondent State was D
in the process of complying with the Central Act.
12. On February 23, 2007, the State of Maharashtra
designated the Principal Secretary (Special), Home
Department, Government of Maharashtra (respondent No.2
herein) as the Controlling Authority and his powers and E
functions were delegated to respondent Nos.3 to 5. By
Notification dated 14th March, 2007, the State of Maharashtra
framed "The Maharashtra Private Security Agencies
(Regufation) Rules, 2007". Thereafter, the members of the
Appellant f.ssociation made applications for issue of licences F
under Section 7 of the Central Act so as to enable them to carry
on their business of security agency but the same were not
issued by the authorities concerned. The Security Guards
Board for Greater Mumbai and Thane District (hereinafter
referred to as "the Board") started threatening the principal G
employers with prosecution under the State Act unless the
principal employers get themselves registered with the Board
and engage security guards of the Board. The members of the
Appellant Association and their clients/principal employers
started receiving show cause notices for prosecuting them. H
892 SUPREME COURT REPORTS [2014] 9 S.C.R.
A 13. Aggrieved by the aforementioned act of the Board, the
members of the Appellant Association filed writ petitions
before the Bombay High Court. Upon the statement made by
the learned Advocate General that all the applications filed by
the writ petitioners under Section 23 of the State Act would be
B decided by the State Government within a period of three
months, the High Court directed the Board not to take coercive
action against the writ petitioners. The High Court by a common
judgment and order dated August 14, 2009 disposed of all the
writ petitions but directed the interim order to continue for a
c period of eight weeks. The appellants are thus before us in
these appeals.
14. Mr. J. P. Gama, learned senior counsel, who was
leading the case of the appellants in the titled appeal, during
the course of hearings submitted a Note, comparing the State
D Act, and the Central Act and on the basis of the same it has
been contended by him that the two enactments are in the
nature of a 'complete code' as they specify the rights, duties
and obligations of the parties governed and that there is no
provision in either of the enactments making the Central Act
E subject to any pre-condition of the State Act. In support of the
same, he submitted this Court's decisions in State of Punjab
vs. Labour Court, Jallundhar & Ors. 5 , Premier Automobiles
Ltd. vs. Kamlekar Shantaram Wadke of Bombay & Ors6. and
that in Krantikari Suraksha Rakshak Sanghatana vs. Bharat
F Sanchar Nigam Limited & Ors7• In those cases, this Court
while dealing with the same State Act held that the State Act
is a self contained Code applying only to the pool guards i.e
the Board Guards. It has been contended that the High Court
erroneously concluded that there is nothing in common between
G the two acts under different entries of the Union List and
Concurrent List; because then it is ex-facie unsustainable for
the High Court to hold that the operation of the Central Act must
s. (1980) 1 sec 4
6. (1976) 1 sec 496
H 7. (2008) 10 sec 166
SECURITY ASSOCIATION OF INDIA v. UNION OF 893
INDIA [PINAKI CHANDRA GHOSE, J.]
be subject to the State Act. Mr. Cama has further contended A
that if both the Acts are to survive then they must be construed
in a manner wherein the security guards get to choose between
joining the respondent Board under the State Act or work under
the coverage of the State Act without going through the
exemption provisions of the State Act and that there is no B
warrant which restricts or interferes with the rights of licensed
security agencies to commence work with the guards who have
chosen to work under them. However, if such contention of the
respondents is to be accepted then a Security Guard who wants
c
to be covered by the Central Act would first have to compulsorily
register and seek exemption under the State Act and then seek
employment under the Central Act. It has been submitted that
such a circuitous method to come under the Central Act has
not been contemplated and is absurd. That if such situation is
accepted by this Court then rights of the appellants are not 0
interfered with and the Acts operate separately, however, any
other position will lead to repugnancy.
15. Mr. Cama, learned senior counsel, without prejudice
to the above, has further submitted that the primary contention
between the two parties is that neither of the Acts prescribes E
that the rights of security agencies shall be subject to exemption
of security guards under Section 23 as concluded by the High
Court without any reasoning in support of the same. It has been
submitted that the language of the Acts is clear without intending
to bring any interdependence between the two Acts and that F
the holding in the impugned judgment is subjective ipse dixit
subject to their own inference on how the two statutes should
be read. The same amounts to judicial legislation which is not
permissible under the law as held by this Court in
Bharathida~an University & Anr. vs. All India Council for G
Technical Education & Ors8• It is submitted that in the impugned
judgment Section 9 of the Central Act has been incorrectly
interpreted ignoring the fact that though the Central Act does
a. c2001) a sec 676. H
894 SUPREME COURT REPORTS [2014] 9 S.C.R.
A not cast an obligation on security agencies to carry on business
it certainly recognizes their fundamental right to do so. It has
also been submitted that the State of Maharashtra never
complied with their statement that they will grant exemption
within six months. That the contention of the State and the Board
B before the High Court that Section 23 only applies to security
agencies who were in business on the date of enactment and
not thereafter, would completely exclude security agencies
starting business after 1981. If such contentions are allowed
then the right to carry on business under Article 19(1 )(g) of the
c Constitution would be violative. Furthermore, it has been
submitted that the High Court while upholding the validity of the
scheme ignored the pertinent submission that Clause 13(1)(b)
of the Scheme of 2002 which prohibited the principal employer
from engaging any private security guards is incorrect as it
0 allows State monopoly.
16. It has been submitted by Mr. Cama, learned senior
counsel that the two Acts are repugnant. Section 23 of the State
Act and Section 9 of the Central Act deal with the same issue
substantially and only through Section 23 of the State Act private
E security agencies are permitted to operate subject to conditions
imposed by the Board. Section 23 regulates the
commencement and operation of private security guard
agencies under the State Act, thereby in conflict with the Section
9 of the Central Act which admittedly regulated the
F commencement and operation of security guards agencies
under the Act. Furthermore, different pre-conditions are laid
down in both the statutes which created a direct and
substantive repugnancy between Section 23 of the State Act
and Section 9 of the Central Act. It has also been contended
G by learned senior counsel that the repugnancy is substantial and
not incidental and in light of the same it has been submitted,
as held by the High Court, that the commencement of the
Central Act and the rights and obligations of the parties under .
the same are subject to grant of exemption under Section 23
H of the State Act, then Section 23 acts as a condition precedent
_;
SECURITY ASSOCIATION OF INDIA v. UNION OF 895
INDIA [PINAKI CHANDRA GHOSE, J.]
for the operation of the Central Act. Such break in the operation A
of the Central Act clearly indicated that the encroachment is not
incidental but substantial, as incidental encroachment does not
affect the existence of two statutes simultaneously. Furthermore,
the holding of the High Court in this regard is also incorrect.
B
17. It has also been submitted by Mr. Cama, learned senior
counsel that Article 246(1) of the Constitution gives the
Parliament a blanket power to make law to govern the whole
of India. The non-obstante clause makes it clear that
irrespective of the rights of the States to legislate under List-II C
or List-Ill, the Parliament is supreme and there is no need for
the legislations to be in the concurrent list before a ban falls
upon the inconsistent State enactment. As per Article 246(1)
of the Constitution, legislation of the Parliament will govern and
there is no need for direct conflict. Mr. Cama in light of the
above submission drew our attention to the decisions of this D
Court in Hoechst Pharamaceuticals Ltd & Ors. vs. State of
Bihar & Ors. 9, Government of Andhra Pradesh & Ors vs. J.B.
Educational Society & Anr. 10, State of West Bengal & O[S. vs.
Committee for Protection of Democratic Rights of West
Bengal & Ors. 11 • Furthermore, Mr. Cama it has been submitted E
that the conflict between 'policy' of the State Government and
'express legislation' by the Parliament was settled in State of
Maharashtra vs. Sant Dnyaneshwar Shikshan Shastra
Mahavidyalaya & Ors., wherein this Court held that when
parliamentary enactment covers a subject then 'state policy' F
does not apply. Thus, when the Central Act legislates on the
issue of security guards at a national level then the State Act
which sets out State Policy must give way to the Central Act.
In light of the above, it has. been brought to our notice that the
Central Act which enables the application of nine labour G
statutes on private security guards, apart from regulation-of
9. (1983) 4 sec 45.
10. (2005) 3 sec 212.
11. (2010) 3 sec 571.
12. (2oos) 9 sec 1. H
896 SUPREME COURT REPORTS [2014] 9 S.C.R.
A agencies, deals with all matters relating to private security
guards and juxtaposed to the Central Act the State Act has a
narrower scope as it is applicable in certain parts of
Maharashtra with respect to employment in factories and
establishments. That the interpretation of the High Court
B creates a situation where two separate statutes apply to
security guards and Agencies in factories and establishments
in the same State.
18. Mr. Gama in his submissions drew our attention to
C Article 254 of the Constitution. He submitted that Article 254(1)
demonstrates that the Parliament has an overriding right to
make any enactment in respect of the items in the Concurrent
List and that as per Article 254 (2), when any law made by the
State Legislature under the Concurrent List is repugnant to the
provisions of a Parliamentary Law and unless the same has
D received Presidential assent the State Law will give way to the
Parliamentary Law. It has further been stated that when the High
Court held the State Act to fall within the ambit of List-Ill and
Central Act to fall under the residuary power in List-I, then the
High Court cannot simultaneously hold that State Act controls
E the Central Act as that is possible only when they fall under the
same list, thereby attracting Article 254(1 ). Furthermore, both
Section 9 and Section 23 regulate operation of security guard
agencies and both the Acts substantively deal with the
employment of private security agencies and private security
F guards engaged by them and the terms and conditions of their
individual employment. It is submitted that the aforementioned
submission must be considered in light of the decision in
Thirumuruga Kirupananda Variyar Thavathiru Sundara
Swamigal Medical Educational & Charitable Trust vs. State
G of Tamil Nadu & Ors. 13, wherein this Court held that even if two
Acts are not in direct conflict, there would be repugnancy of the
superior legislation if it shows an intention to cover the whole
field.
H 13. (1996) 3 sec 15.
SECURITY ASSOCIATION OF INDIA v. UNION OF . 897
INDIA [PINAKI CHANDRA GHOSE, J.]
19. Mr. Cama on behalf of the appellants has also A
contended that Section 23 of the Central Act violates Article
19( 1)(g) of the Constitution because Section 23 when read with
the licensing provisions of the Central Act creates a position
where a security agency to commence its business is made
subject to the vagaries of a possible exemption of necessary B
security guards and interferes with their fundamental right to
commence and carry on business. This position is further
worsened when the concerned agency is unable to find a guard
who wants to apply for exemption and especially in light of the
fact that there is no pool of exempted guards, that there is no c
time limit for the State Government to act on an exemption
application and that is subject to the discretion of the State
Government. It has been further submitted that the power of
discretion given to the State Government by means of Section
23 is uncanalized and unregulated upon their subjective
0
satisfaction for a specified period only for all or such class or
classes and such power interferes with the agency's right to
business which will be subject to the opinion of the State
Government. It has also been submitted that the benefits under
the Central Act are as good or even better than those provided
in the State Act. Mr. Cama placed reliance on the comparative E
Note submitted by him during the course of arguments and
stated that the Central Act also allows the State Government
to make rules and they can incorporate the beneficial
provisions in the Rules under the Central Act.
F
20. The submissions of the Appellant Association were
finally concluded by Mr. Cama on the Note that in light of the
unsustainable view of the High Court both the Acts can operate
simultaneously, it is submitted that as .canon of construction,
every Court can read two independents statutes subject to each G
other but it also must be noted that where the language of the
Act is unambiguous, nothing must be read into it. It was further
submitted that a statute must be read as it stands in the facts
of legislations by incorporation or legislation by reference, a
separate statute can be read into another statute and that H
898 SUPREME COURT REPORTS (2014] 9 S.C.R.
A requires an express statutory provision. In this light, the relief
sought before us is that either it must be clarified that the two
Acts operate in their own field and that the Central Act is not
subject to exemption under Section 23, and if not then the State
Act must give way to the Central Act on being repugnant to the
B same.
21. It is the case of Dr. A. M. Singhvi, learned senior
counsel, appearing for the appellants in the connected appeal,
being Civil Appeal No. 8671 of 2011, that Section 1(4) exempts
security guards who are direct and regular employees of a
C factory or establishment, however the appellant (being HSBC)
would prefer to hire security guards of private agencies due to
certain advantages. The two private security agencies being
respondent Nos. 7 and 8 (in Civil Appeal No. 8671 of 2011)
were supplying the appellant with security personnel exempted
D under Section 23 of the State Act. However, the application for
renewal made by the appellant under Section 23 was kept
pending by the State Government and the agency had applied
for a license under Section 4 of the Central Act and was entitled
to commence business in light of the proviso to Section 4.
E While the appellants awaited for their licence the State
Government initiated penal action against the appellants for
engaging non-exempted security guards, against which a writ
petition disposed by the impugned judgment was filed. In light
of the same, it has been submitted by Dr. Singhvi that certain
F parts of the State Act and the Scheme are repugnant to the
Central Act.
22. Mr C.U. Singh, learned senior counsel appeared on
behalf of Mumbai International Airport Pvt. Ltd. being the
G appellant in Civil Appeal No.8670 of 2011 and Convergys India
Services P. Ltd & Anr. being the appellants in Civil Appeal
No.8709 .of 2011. He adopted the arguments tendered by Mr.
Cama and ' Dr. Singhvi and in addition thereto, he advanced
arguments on six more grounds. The first ground being that the
provisions of the prior State Act of 1981 and the Scheme
H
SECURITY ASSOCIATION OF INDIA v. UNION OF 899
INDIA [PINAKI CHANDRA GHOSE, J.]
framed thereunder are inconsistent with the provisions of the A
later Central Act and they must give away to the extent of the
inconsistency. In light of the same it has been submitted that
regardless of the Central Act being traced to List-I of the
Seventh Schedule, the Central Act will prevail to the extent of
inconsistency in view .of Article 246( 1) and if the Act is traceable B
to List-Ill, then it will prevail due to the Proviso to Article 254(2).
Mr. Singh in furtherance of the same placed the decisions of
this Court in H. S. Srinivasa Raghavachar & Ors vs. State of
Karnataka & Ors 14 . and State of Kera/a & Ors. vs. Mar
Appraem Kuri Company Limited & Anr15 • c
23. The second ground raised by Mr Singh is that the State
Act does not have any express provisions for registration of
private security agencies or for regulating their activities and
business under the Scheme and therefore it is only the latter
Central Act of 2005 which can regulate or control their activities. D
In light of the same it has been put forth by Mr. Singh that the
State Act is an enabling legislation which operates through the
Scheme and in the entire corpus of the State Act and the
Scheme of 2002 there is no provision requiring registration of
private security agencies and that only the Central Act regulates E
and governs private security agencies, which fall out of the
scope of the State Act and cannot be forced to seek an
exemption from the same. Furthermore, this also indicates that
Section 23 is in conflict with the Central Act.
F
24. The third ground of submission raised by Mr. Singh is
that the Central Act juxtaposed to the State Act is a special
statute whereas the State Act is a special statute in relation to
the Board Guards and a general statute with respect to the
private security guards, who choose not to register with the G
Board and that the latter specific statute passed by the
Parliament must prevail over the prior general statute of a State
legislature. In furtherance of the same he placed before us the
14. (1987) 2 sec 692.
15. c2012) 1 sec 106. H
900 SUPREME COURT REPORTS [2014] 9 S.C.R.
A decision of this Court in P. V. Hemlatha v. Kattamkandi Puthiya
Maliackal Saheeda 16 and a Constitutional Bench decision in
Ashoka Marketing Ltd. & Anr vs. Punjab National Bank &
Ors. 17 , which upheld the maxim "leges posteriors priores
contrarias abrogant". The fourth ground of submission is that
B in any event the application and operation of the later Central
Act are made subject to compliance with the prior State Act,
then the State Act is clearly repugnant to the Central Act; and
being a prior statute, must give way either under Article 246(1)
read with Article 248, or under the proviso to Article 254(2). He
c has placed before the decisions in Zaverbhai Amaidas vs.
State of Bombay18, Deep Chand vs. State of Uttar Pradesh &
Ors. 19, State of Orissa vs. M.A. Tulloch and Co. 20 , and
Thirumuruga Kirupananda Variyar Thavathiru Sundara
Swamigal Medical Educational & Charitable Trust vs. State
0 of Tamil Nadu & Ors. (supra). The fifth contention raised by Mr.
Singh is that the State and/or the Board cannot purport to create
a monopoly for the Board and to make the very existence of
private security agencies dependent upon exemption granted
at the whims and fancies of the State Government, after the
E enactment of the Central Act in 2005 and that there is no
enabling power or authority conferred by the State Act to do
so. The final contention raised by Mr. Singh is that the Central
Government, which has enacted the later Central Statute and
is responsible for implementing the same, has filed a Counter
Affidavit in the in C.A. No. 8670 of 2011 completely supports
F the contentions of the appellants. Therefore, placing reliance
on the decisions of this Court in K.P. Varghese vs. Income Tax
Officef< 1 and State of Tamil Na du vs. Mahi Traders & Ors. 22, .
16. c2002) 5 sec 548.
G 17. (1990) 4 sec 406.
18. [1955] 1 SCR 799.
19. AIR 1959 SC 648.
20. (1964] 4 SCR 461.
21. (1981) 4 sec 1n.
H 22. (1989) 1 sec 724.
SECURITY ASSOCIATION OF INDIA v. UNION OF 901
INDIA [PINAKI CHANDRA GHOSE, J.)
it has been submitted that the statements made on oath by A
the Central Government are entitled to the highest weight based
on the principle of contemporanea expositio.
25. In light of the above contentions, Mr. Singh has
submitted that through the impugned judgment, a monopoly has
B
been created in favour of respondent No.1, being the Board,
as the principal employer has no freedom in choosing the
security agency or the security guards deployed in their
establishments. Thus, the High Court overlooked the interest
of the principal employer and private security agencies and that C
the State Act takes away the fundamental right of the private
security agencies from operating and conducting business
conferred by the Central Act. It was also submitted that the
Parliament clearly intended its legislation to be a complete and
an exhaustive Code relating to the subject and it is, therefore,
deemed that the Central Act has replaced the Maharashtra Act. D
It is also submitted that Clauses 8, 25 and 28 of the Scheme
of 2002 are arbitrary and violate the appellants' fundamental
rights under Articles 14 and 19(1 )(g) of the Constitution being
an unreasonable encroachment on the right of the appellants
to seek deployment of the most suitable class or classes of E
security guards from the Appellants' viewpoint. It is further
submitted that the Central Act and the State Act are enacted
under the same legislative entry of the seventh Schedule,
substantially covering the same field and as the Parliament
sought to cover the same field the State Act, insofar as the F
agency guards are concerned, must give way and after 2005,
the State Act applies only to guards deployed by the Board.
26. It is also the case of Mr. Singh that the Central Act is
a complete and self-contained code covering the entire G
business of security services through private security agencies
throughout the length and breadth of India, without exception or
limitation; furthermore, the Central Act constitutes a
comprehensive regulatory mechanism headed by a Controlling
Authority in each State which is in charge of all matters
H
902 SUPREME COURT REPORTS [2014] 9 S.C.R.
A pertaining to private security agencies and private security
guards with the State. It was also submitted that the prohibition
of agencies of m.iddlemen by the State Act cannot ban or
prohibit a private security agency which complies with the
requirements of the Central Act and is licensed thereunder,
B from functioning and supplying guards to factories or
establishments; that even if there is no repugnancy then the only
way to interpret the State Act and particularly Section 23 thereof,
which will save the Constitutionality of the State Act, is to read
it down and treat it as a purely regulatory provision for
C safeguarding those service conditions of private security
guards which are not governed or regulated by the Central Act.
27. Mr. Singh further submitted that the State Act operates
through the Scheme of 2002 which expressly allows principal
employers and guards the free choice of employment and
D deployment has not been challenged. That this free choice
cannot be curtailed by relying on an earlier interpretation given
by this Court in Security Guards Board for Greater Bombay
and Thane District vs. Security & Personnel Services Pvt. Ltd.
& Ors. (supra).
E
28. Mr Singh has also drawn our attention to Clauses 13(1)
(b), 25(2) and 26(4) of the Scheme of 2002 and submitted that
on account of the aforementioned clauses, a user or consumer
of security services is forced to use the Board and its sub-
F standard guards, even if the user is completely dissatisfied with
the services provided, solely on the ground that earlier they
were registered with the Board that sometime in the past, such
user (or even some imaginary predecessor of such user or
consumer) had made the mistake of registering with the Board.
G Moreover, Clause 42 creates a penal liability, if any of the
clauses of the Scheme of 2002 is contravened.
29. Furthermore, it has been submitted that the provisions
of the Scheme· of 2002 and the State Act which enable the
Board to monopolize the supply of security guards and
H restricting right of choice of a private security guard or a
SECURITY ASSOCIATION OF INDIA v. UNION OF 903
INDIA [PINAKI CHANDRA GHOSE, J.]
principal employer are ultra vires the provisions of the State A
Act as amended in 1996 and of Articles 14 and 19(1) (g). Mr.
Singh concluded by contending that any interpretation of the
State Act which prohibits or restricts the busir'less of agencies
will create an irreconcilable conflict between the two Acts, with
the Central Act prevailing. In light of the same, he submitted that B
courts should adopt an interpretation which sustains the
constitutionality of provisions, and avoid an interpretation which
would bring the provisions in conflict with other laws which might
prevail over them.
30. Mr. Krishnan Venugopal, learned senior counsel C
appearing for the State of Maharashtra, while replying to the
alleged violation of Articles 14 and 19(1 )(g) of the Constitution
of India and the repugnancy of the State Act to the Central Act,
submitted that there is a presumption of constitutionality to every
statute irrespective of it being passed by the Union or a State D
legislature and an apprehension of abuse by a statutory
authority is no ground for striking down the same. He further
contended that the reliance placed by Mr. C.U. Singh, learned
senior counsel on the counter affidavit of the Central
Government is misplaced as once a statute is passed by a E
legislature then only the Courts may iil~rpret it and determine
its constitutional validity. In supp9J:l-Oftlfs submissions he placed
reliance upon the decisions of this Court in Sanjeev Coke
Manufacturing Company vs. Mis Bharat Coking Coal Ltd. &
Anf-3 • and NDMC Vs. State of Punjab & Ors24 . It has been F
submitted by Mr. Venugopal that right to do business is a
fundamental right conferred by Article 19(1)(g) and a statute
cannot be interpreted to confer the same unless it expressly
says so. lri fact the Central Act is a regulatory mechanism
restricting the right to do business of private security agencies G
by making them subject to certain conditions and does not
confer on them any right. Furthermore, it has been submitted
23. (1983) 1 sec 147.
24. (1997) 1 sec 339. H
904 SUPREME COURT REPORTS [2014] 9 S.C.R.
A that the High Court in Tradesvel Case (supra) has already held
that Section 23 is valid and not violative of the Constitution. This
decision was also upheld by this Court vide Order dated
January 1, 1983. It has also been submitted that the State Act
is a beneficial legislation falling under the Directive Principles
B of State Policy and should be upheld as reasonable restriction
on the fundamental rights of the appellants under Articles 14
and 19. In support of the same he placed before us the
decisions of this Court in State of Gujarat vs. Mirzapur Moti
. Kureshi Kassab Jamat & Ors 25 . and Pathumma & Ors vs.
c State of Kera/a & Ors26 .
31. Mr. Venugopal has also raised the contention that the
State Act is not repugnant to the various labour statutes as
argued by the appellants as the President gave general assent
to the Bill of the State Act under Article 200 on September 24,
D 1981. He has put forth that it is a well settled position that if
Presidential assent is given in general terms to a State statute,
the State legislation will prevail over a Parliamentary law on
matters contained in the Concurrent List. Mr. Venugopal placed
reliance on the decisions of this Court in Rajiv Sarin & Anr.
E vs. State of Uttarakhand & Ors. 27 and Gram Panchayat vs.
Ma/winder Singh & Ors 28 • He further stated that for the
purposes of Article 254(2) the Presidential Assent is effective
to shield the Maharashtra Act from repugnancy.
F 32. On the ground of repugnancy it has been submitted by
Mr. Venugopal that a State Act is repugnant to a Central Act
when they are on the same subject and rlilate to the same entry
in the Concurrent List. The same is determined by a series of
tests including the determination of the pith and substance of
G the statute claimed to be repugnant, considering the "occupied
25. (2005) 8 sec 534.
26. (1978) 2 sec 1.
21. (2011) 8 sec 108 .
H 28. (1985) 3 sec 661.
SECURITY ASSOCIATION OF INDIA v. UNION OF 905
INDIA [PINAKI CHANDRA GHOSE, J.]
field". Mr. Venugopal Drew our attention to decisions of this A
Court in Rajiv Sarin & Anr. vs. State of Uttarakhand & Ors.
(supra), Offshore Holding Pvt. Ltd vs. Bangalore Development
Authority & Ors. 29 , Gimar Traders vs. State of Maharashtra &
Ors. 30, Gram Panchayat vs. Ma/winder Singh & Ors. (supra),
State of Gujarat vs. Mirzapur Moti Kureshi Kassab Jamat & B .
Ors. (supra), State of Rajasthan vs. Vatan Medical & General
Store & Ors. 31 and State of Bihar & Ors. vs. Shree Baidyanath
Ayurved Bhawan (P.) Ltd. & Ors32 . He further submitted that it
is clear from the statement of objects and reasons, the
preamble, the legislative scheme, the provisions of the Central c
Act, its scope and its nexus with its object, that it is in pith and
substance a law to regulate private security agencies in the
interest of national security relatable to Entry 97 and it does
not provide for the labour welfare of security guards. This is
juxtaposed to the provisions of the State Act which clearly D
indicate that it is a beneficial social welfare legislation relatable
to Entry 24 of List 111 insofar as it provides for regulation in the
interest of labour welfare of private security guards in notified
districts in the State of Maharashtra. Mr. Venugopal drew our
attention to the comparative table between the provisions of the E
two statutes submitted by him during the course of
proceedings.
33. It has been further submitted by Mr. Venugopal that an
incidental encroachment by the State law on a forbidden field
does not affect the competence of the legislature to enact the F
law as held by this Court in Gimar Traders vs. State of
Maharashta & Ors. (supra) and K.K. Bhaskaran vs. State33 ;
and that incidental encroachments by a State law into the field
covered by the Central law, are an exception even to the
G
29. (2011) 3 sec 139.
30. (2011) 3 sec 1.
31. (2001) 4 sec 642.
32. (2005) 2 sec 762.
33. (2011) 3 sec 793. H
906 SUPREME COURT REPORTS [2014] 9 S.C.R.
A doctrine of occupied field. That only ·if there is direct and
irreconcilable inconsistency between the Central Act and the
State Act, the issue of repugnancy can arise as held by this
Court in M. Karunanidhi vs. Union of India & Anr34 . and Vijay
Kumar Sharma & Ors. vs. State of Karnataka & Ors. 35 •
B
34. Mr. Venugopal, in furtherance of his argument on the
issue of repugnancy, stated that Section 13(1 )0) of the Central
Act which requires that licensed private agencies have to
comply with the nine Central labour law legislations, does not
turn the Central Act into a labour welfare statute or create an
C irreconcilable conflict with the State Act as it is merely an
incidental and ancillary provision in the Central Act and does
not turn it into a labour welfare statute. Similarly, the exemption
provision in Section 23 of the State Act does not create a
conflict between the two Acts it is purely regulatory in character
D for the purpose of ensuring decent labour conditions and a living
wage to private security guards; and removing the same would
result in great hardship and exploitation of private security
guards. Lastly, he concluded by submitting that if different
aspects of the same activity are regulated under a Central law
E and a State law, it will not render the State law unconstitutional
on the ground of being inconsistent with, or repugnant to, the
Central law so long as the Central law and the State law
operate in different fields and are relatable to different entries
in any of the lists in the Seventh Schedule. In support of this
F submission learned senior counsel placed reliance on two
earlier judgments, being State of Bihar & Ors. vs. Shree
Baidyanath Ayurved Bhawan (P.) Ltd. & Ors (supra) and Vijay
Kumar Sharma & Ors. vs. State of Karmataka & Ors. (supra).
G 35. Mr. Venugopal has countered the claim of the
appellants that the State cannot create monopoly in it favour
on the ground that the creation of a monopoly by a statute
including subordinate legislation by a competent legislature is
34. (1979) 3 sec 431.
H 35. (1990) 2 sec 562.
SECURJTY ASSOCIATION OF INDIA v. UNION OF 907
INDIA [PINAKI CHANDRA GHOSE, J,]
not open to challenge under Art.19(1 )(g) of the Coastitution in A
view of Article 19(6). Moreover, the State Act does not create
an absolute monopoly in favour of the Securities Board in view
of the exemption provision in Section 23 of the Maharashtra
Act for security guards or classes of security_.gugirds employed
by private security agencies. He strongly relied on the decision B
of the High Court in the Tradesvel Case (supra) pertaining to
the State Act wherein the restrictions imposed by the said Act
were held to be reasonable and also submitted the decisions
in H. C. Narayanappa & Ors. vs. State of Mysore & Ors 36 • and
Khoday Distilleries Ltd & Ors. vs. State of Karnataka & Ors. 37• c
36. It is also the case of Mr. Venugopal that from Section
13(1 )0) of the Central Act, it is clear that the labour statutes
mentioned in the schedule to the Act are not incorporated in
the Act. Further, neither the issue of both Acts being self-
contained codes, nor the issue of legislation by incorporation D
as opposed to legislation by reference, is relevant inasmuch
as both the Central Act and the State Act can co-exist
harmoniously without any conflict. .
37. Mr. Venugopal closed his arguments with the E
contention that the State Act has been upheld in numerous
challenges over the years on various grounds, including many
of the grounds urged in these civil appeals. In light of the same
he drew our attention to the decision of the High Court in the
Tradesve/ Case (supra) and the dismissal of the special leave F
petition challenging the same, the decision of this Court in
Security Guards Board for Greater Bombay and Thane District
vs. Security & Personnel Services Pvt. Ltd. & Ors. (supra), the
decision of the High Court in W.P. 1085 of 2002 wherein the
High Court upheld the Scheme of 2002, the decision which G
upheld the 1996 amendments to the State Act being the
Krantikari Suraksha Rakshak Sanghatana vs. State of
36. AIR 1960 SC 1073.
37. (1995) 1 sec 574.
H
908 SUPREME COURT REPORTS [2014] 9 S.C.R.
A Maharashtra & Ors. (supra) 38, which was further upheld by this
Court which held that the State Act and the Scheme constituted
a complete and self-contained Code in Krantikari Suraksha
Rakshak Sanghatana vs. Bharat Sancher Nigam Ltd. & Ors.
(supra) and lastly the unchallenged decision of the High Court
B in National Textile Corporation vs. The Secretary, Security
Guards Board for Brihan Mumbai and Thane District & Ors.
(WP No.2773/2006 decided on January 12, 2007) wherein it
was held that the Central Act regulated the private security
agencies so that they do their job within the legal framework
c and are accountable to the regulatory mechanism as provided
under the Act while the State Act is for the regulation of the
employment of the Private Security Guards employed in the
factories and establishment in the State of Maharashtra and for
making better provisions of their terms and conditions of
employment and welfare through the establishment of the
0
Security Board.
38. Mr. Anand Grover, learned senior counsel appeared
on behalf of the respondent No. 8, being one of the Trade
Unions consisting of private security guards. Mr. Grover in his
E arguments reiterated the grounds raised by Mr. Venugopal and
further contended that the Central Act does not occupy the field
of labour welfare of security guards, firstly, because Sections
4, 5, 6 & 7 of the Central Act do not make compliance with
labour welfare statues, listed in the Schedule to the Act, a
F condition for obtaining a licence under the Act; secondly, as it
is clear from the words of Section 13(1 )U) of the Central Act
that the applicability of the welfare Acts are at best discretionary
and the Controlling Authority "may" cancel a licence on non
compliance of the labour welfare Acts; thirdly, the Central Act
G contains no proactive and regular checks on compliance with
the Central labour laws. It has been further submitted that the
main objective of the State Act is labour welfare. In light of the
same he drew our attention to Sections 19, 20 and 21 of State
Act and referred to Section 3 of the State Act and the Scheme
H 38. 2006 (6) ALL MR 401.
SECURITY ASSOCIATION OF INDIA v. l.:JNION OF 909
INDIA [PINAKI CHANDRA GHOSE, J.]
of 2002. He further argued that the State Act proactively A
monitors the employment conditions of the private security
guards in spite of being exempted under Section 23, ensuring
their welfare for the exemption to continue and that the State
Act has a proper me~hanism ensuring that welfare provisions
are complied with. s
39. Mr. Grover heavily relied on the decision of the
Supreme Court of Canada in Canadian Western Bank vs.
Alberta 39 wherein the Court referred to the doctrine of co-
operative federalism, to support his contention that the Central
Act and State Act apply concurrently as the two Acts do not C
regulate the same aspects, the Central Act ends at licensing
and the State Act begins with labour welfare.
40. Mr. Grover concluded his arguments with the
submission that the Scheme of 2002 does not violate Articles o
14 and 19 of the Constitution. He stated that the parties. did
not bring the same challenge before the original court and
therefore, cannot raise the ground at this stage. He also drew
our attention to specific clauses of the Scheme of 2002 and
stated that they are not unconstitutional. Firstly, he put forth the E
provisions in Clause 13(1)(b) of the Scheme of 2002 and stated
that the conditions imposed by the same are in consonance
with the State Act enacted to ensure fair conditions of
employment and amelioration of security guards. Secondly, he
stated that Clause 25(2) is not arbitrary and unreasonable as F
it ensures fair conditions of employment and its restrictions are
in consonance with the Act. Thirdly, it has been contended that
Clause 26(4) is in consonance with the Act and the Scheme
and that it is an enabling provision to ensure that exemption is
granted to security guards to be deployed by the employer
agency only at those factories and establishments which are G
registered with the Boards.
41. Respondent No.9 in the titled appeal (C.A. No. 8814
39. (2007] Canadian S.C.R. 3 . H
910 SUPREME COURT REPORTS (2014] 9 S.C.R.
A of 2011) being Maharashtra Rajya Suraksha Rakshak &
General Kamgar Union, a registered Trade Union, also made
separate submissions through its counsel along with Bhartiya
Suraksha Rakshak Union, which is also a registered Trade
Union of security guards and filed an application for
B impleadmenUintervention in the matter which is registered as
I.A. No. 7. Their submissions are concerning the alleged
exploitation of security guards by the security agencies. It is
their case that security agencies in connivance with the
principal employers have been making several attempts to
c circumvent the welfare provisions of the State Act since the
inception of the State law and that the private security agencies
could not have made yet another attempt with the principal
employers to avoid the reasonable restriction imposed against
them on their right to business in connection with security
guards. It has been submitted that the State Act imposes
0
reasonable restrictions against security agencies and that the
Board acts as a watchdog ensuring that the exempted guards
are availing equally or more favourable terms and conditions
of employment, which has been determined by the mechanism
of the Board established under the State Act and the agencies
E undertook at the time of seeking exemption.
42. Both the Trade Unions being respondent No.9 and the
impleaded party, apart from accepting the submissions of Mr.
Venugopal and Mr. Grover, have sought that the State Act be
F enforced in toto for the welfare of the private security guards in
the State of Maharashtra which can only be ensured by the
State Act which has sufficient proactive measures for the
enfbrcement of the labour welfare provisions.
G 43. Having heard the arguments of all the parties and after
peru~ing the materials placed before us during the course of
hearing, we find that the primary issue in the present matter is
whether the State Act is repugnant to the Central Act. The
learned senior counsels appearing for both the parties
submitted a plethora of cases in this regard, however we will
H limit ourselves only to the pertinent cases.
SECURITY ASSOCIATION OF INDIA v. l:JNION OF 911
INDIA [PINAKI CHANDRA GHOSE, J.]
44. Article 246 of the Constitution does not provide for the A
competence of Parliament or the State Legislatures as
commonly perceived but merely provides for their respective
fields. Article 246 only empowers the Parliament to legislate
on the entries mentioned in List-I and List-Ill of the Seventh
Schedule and that in case of a conflict between a State Law B
and a Parliamentary Law under the entries mentioned in List-
111, the Parliamentary law will prevail. It does not follow that the
Parliament has a blanket power to legislate on entries
mentioned in List-II as well. Thus, the argument of the appellants
that the Parliament has supreme right to legislate over any area 8
as per Article 246(1) is misplaced. Furthermore, this Court in
Welfare Association, A.R.P., Maharashtra & Anr. vs. Ranjit P.
Gohil & Ors4°. also held that:
"The fountain source of legislative power exercised by
Parliament or the State Legislatures is not Schedule 7; the D
fountain source is Article 246 and other provisions of the
Constitution. The function of the three lists in the Seventh
Schedule is merely to demarcate legislative fields between
Parliament and States and not to confer any legislative
power." E
45. It has become a well-established principle that there
is a presumption towards the constitutionality of a statute and
the courts should proceed to construe a statute with a view to
uphold its constitutionality. (See: State of Andhra Pradesh vs. F
K. Purushottam Reddy & Ors. 4 1, State of Gujarat vs. Mirzapur
Moti Kureshi Kassab Jamat & Ors. (supra), (paras 20 and 70,
State of MP vs. Rakesh Kohli & Anr.42)
46. In light of the above, we will answer the question of
repugnancy of the State Act with respect to the Central Act. The G
question of repugnancy arises only in connection with the
40. c2003) 9 sec 358.
41. (2003) 9 sec 564.
42. c2012) e sec 312. H
912 SUPREME COURT REPORTS [2014] 9 S.C.R.
A subjects enumerated in the Concurrent List (List -Ill), on which
both the Union and the State Legislatures have concurrent
powers to legislate on the same subject i.e. when a Stale Law
and Central Law 1Jertain to the same entry in the Concurrent
List. Article 254(1) provides that if a State law relating to a
B concurrent subject is 'repugnant' to a Union law then irrespective
of the Union law being enacted prior to or later in time, the
Union law will prevail over the State law. Thus, prior to
determining whether there is any repugnancy or not, it has to
be determined that the State Act and the Central Act both relate
c to the same entry in List-Ill and there is a 'direct' and.
irreconcilable' conflict between the two. i.e. both the provisions
cannot stand together.
47. Article 254 of the Constitution is only applicable when
the State Law is in its 'pith and substance' a law relating to an
D entry of the Concurrent List on which the Parliament has
legislated. It has been well established that to determine the
validity of a statute with reference to the entries in the various
lists,, it is necessary to examine the pith and substance of the
Act and to find out if the matter comes within an entry in List-Ill.
E The Court while examining the pith and substance of a statute
must examine the whole enactment, its objects, scope and
effect of its provision. Only if it is found that the two enactments
cover the same matter substantially and that there is a direct
and irreconcilable conflict between the two, the issue of
F repugnancy arises. (See: State of Gujarat vs. Mirzapur Moti
Kureshi Kassab Jamat & Ors. (supra), Offshore Holding Pvt.
Ltd. vs. Bangalore Development Authority & Ors. (supra),
State of West Bengal vs. Kesoram Industries & Ors. 43}.
48. The Preamble of the Central Act reads as under:
G
"An Act to provide for the regulation of private security
agencies and for matters connected therewith or incidental
thereto."
H 43. (2004) 10 sec 201.
-
SECURITY ASSOCIATION OF !NOIA v. UNION OF 913
!NOIA [PINAKI CHANDRA GHOSE, J.]
On the other hand the Preamble of the State Act reads as A
under:
"An Act for regulating the employment of Private Security
Guards employed in factories and establishment in the
State of Maharashtra and for making better provisions for B
their terms and conditions of employment and welfare,
through the establishment of a Board therefore, and for
matters connected therewith."
As per this Court's decision in In re Special Reference
No. 1 of 20004 4 every attempt should be made to reconcile a C
conflict between two statutes by harmonious construction of the
provisions contained in the conflicting statutes. However, in the
present matter from a bare reading of the above extracts it is
evident that the Central Act only regulates the business of
private security agencies and connected and incidental matters D
thereto. Thus, Section 13(1 }U) of the Central Act which requires
compliance with the Central Labour laws as a condition to
ensure the validity of the licence obtained under the Act is a
provision incidental to the purpose of the Act. The statement
of object of the State Act clearly indicates that the State Act E
seeks to regulate the employment of Private Security Guards
employed in factories and establishment in the State of
Maharashtra and seeks to ensure better terms and conditions
of employment of such guards through the establishment of a
Board. F
50. It is evident from the above that the subject matters of
the two Acts are substantially different and the conflict in the
operation of the two Acts is incidental. Furthermore, after
comparing the provisions of both the Acts, that both the Acts
operate in different fields and that there is only incidental G
connection between the two regarding the regulation of private
security agencies, wherein Section 23 of the State Act exempts
private security guards for the operation of business of private
44. c2004) 4 sec 489. H
914 SUPREME COURT REPORTS [2014] 9 S.C.R.
A security agencies after ensuring that such exempted guards
enjoy benefits, either equal or better than those provided by the
State Act. Therefore, the High Court has correctly held that:
"25. It is clear that this group of petitions have been filed
after the enactment of the Central Act to claim that in view
8
of the enactment of the Central Act, the State Act has lost
its efficacy in relation to the security agencies. Perusal of
the preamble of the State Act shows; that the purpose; for
which that Act has been enacted is - regulating the
employment of security guards employed in factory and
c establishment 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 there for. It is thus clear that the State Act is a labour
Legislation enacted by the State Legislature for making
D better provisions for the terms and conditions of
employment of the private security guards and their
welfare. The Legislation, therefore, is referable to Entry 24
in List Ill (Concurrent List) in the Seventh Schedule of the
Constitution of India. The entry reads as under:
E
"24. Welfare of labour including conditions of work,
provident funds, employers' liability, workmen's
compensation, invalidity and old age pensions and
maternity benefits."
F We have, thus, no doubt, in our mind that the State Act is
a Labour Legislation, which the State Government is
competent to enact because of Entry 24 found in List Ill of
Seventh Schedule of Constitution. So far as the Central Act
is concerned, its preamble shows that the Act has been
G enacted by the Parliament - for the regulation of the Private
Security Agencies and for matters connected therewith and
incidental thereto. The subject matter of the State Act is
private security guards who may be engaged by the
principal employer either through the Board or through the
H security agencies. The subject matter of the Central
SECURITY ASSOCIATION OF INDIA v. UNION OF 915
INDIA [PINAKI CHANDRA GHOSE, J.]
Legislation is not the private security guards, but private A
security agencies. Thus, the subject of two Legislations is
different. Perusal of the Central Act shows that it makes
an endeavour to regulate the establishment and working
of private security agencies. Section 4 lays down that no
person shall carry on and commence the business of B
security agency unless he holds a licence issued under this
Act. Section 5 of the Central Act lays down as to who are
eligible for licence. From the scheme of the Central Act, it
is thus clear that it regulates the business of private
security agencies by making it obligatory on them to c
secure licence under the Central Act before commencing
their business. The provisions found in the Central Act
dealing with the eligibility of the security guards are
incidental to the subject of legislation namely business of
private security agency. The condition of service and 0
welfare of the security guards is not the subject matter of
Legislation in the Central Act. In list I or List Ill of the Seventh
Schedule there does not appear to be any entry in relation
to the regulation of business of security agency. Therefore,
the Central Legislation may be relatable to residuary Entry
E
97 In List I. Perusal of the provisions of the State Act shows
that it does not make any attempt to regulate the business
of private security agency."
51. The other test to determine the issue of repugnancy is
the "doctrine of occupied field" which stipulates that even where F
the Central Act is not exhaustive, repugnancy may arise if it
occupies the same field as the State Act. The question of
repugnancy arises only when the law made by the Parliament
and the State Legislature occupy the same field. (See: Deep
Chand vs. State of Uttar Pradesh & Ors. (supra), , Hoechst G
Pharamaceuticals Ltd & Ors. vs. State of Bihar & Ors. (supra)).
Furthermore this Court in M. Karunanidhi vs. Union of India &
Anr. (supra) held that:
"24. It is well settled that the presumption is always in
H
916 SUPREME COURT REPORTS [2014] 9 S.C.R.
A favour of the constitutionality of a statute and the onus lies
on the person assailing the Act to prove that it is
unconstitutional. Prima facie, there does not appear to us
to be any inconsistency between the State Act and the
Central Acts. Before any repugnancy can arise, the
s following conditions must be satisfied:
1. That there is a clear and direct inconsistency between
the Central Act and the State Act.
2. That such an inconsistency is absolutely irreconcilable.
c
3. That the inconsistency between the provisions of the two
Acts is of such a nature as to bring the two Acts into direct
collision with each other and a situation is reached where
it is impossible to obey the one without disobeying the
0 other"
The above was also upheld by this Court in the case of
Government of Andhra Pradesh & Anr. vs. J.B. Educational
Society & Anr. (supra).
E 52. In the present case, after perusing the two Acts in
entirety, we find that two statutes occupy different fields as
stated earlier. The Central Act aims to regulate the business
of private security agencies and Section 13(1 )0) of the Central
Act which reads as under, does not turn the Central Act into a
F labour welfare statute as the same is an incidental provision.
"13. Cancellation and suspension of licence.-(1) The
Controlling Authority may cancel any licence on any one
or more of the following grounds, namely:-
G
0) that the licence holder has violated the provisions of the
Acts given in the Schedule which may be modified by the
Central Government, by notification in the Official Gazette;
H
SECURITY ASSOCIATION OF INDIA v. UNION OF 917
INDIA [PINAKI CHANDRA GHOSE, J.]
,,
A
Thus, we accept the arguments of Mr. Venugopal with
regard to the same. The State Act is in contrast to the Central
Act as it contains express provisions pertaining to labour
welfare and contains mechanism to ensure that the same are 8
complied with. Furthermore, the State Act also imposes penal
liability if the said provisions are not complied with. The High
Court decision in the Tradesve/ Case (supra), challenge to
which was dismissed by this Court, also held the State Act to
be a welfare legislation. Therefore, we are of the opinion that C
the two st~tutes occupy distinct fields.
53. The appellants have also challenged the State Act to
be violative of Articles 14 and 19 of the Constitution. However,
we find that ·the same does not hold good as the restrictions
imposed by the State Act are reasonable restrictions D
envisioned by the Constitution and that they protect the rights
and ensure the welfare of private security guards engaged by
private security agencies by means of Section 23 and relevant
provisions of the Scheme of 2002. Furthermore, the High Court
in the Tradesve/ Case (supra) while answering the same E
question and considering the situation of the private security
guards held the State Act is not to be in violation of Articles 14
and 19 or any other Fundamental Rights contained in the
Constitution. Therefore, we accept the arguments put forth by
Mr. Venugopal in this regard. F
54. The other impediment which tried to be pointed out by
the learned senior counsel appearing on behalf of the appellant
in respect of Section 23 of the State Act that it compels all the
security guards employed by the agencies and deployed with
various principal employers to seek exemption is totally G
misconceived because it would bring about total stoppage of
the agency's business. After analyzing Section 23 of the said
Act, it appears to us that exemption can be granted to a class
or classes of Security Guards, employed by agencies and
deployed with the principal employer and who are in the H
918 SUPREME COURT REPORTS [2014] 9 S.C.R.
A enjoyment of benefits which are on the whole not less favourable
to such security Guards than the benefits provided for or under
this Act or any Scheme made thereunder. We have noticed that
the High Court has duly taken care of that and considered the
said scheme and pointed out that to seek the benefit of
B exemption under Section 23, three conditions are necessary.
Firstly, the class or classes of Security Guards should be
employed by the agency or agent. Secondly, those Guards
must be deployed by the concerned agency in a factory or
establishment or in any class or classes of factories or
c establishments and thirdly, in the opinion of the State
Government, all such Security Guards or such class or classes
of Security Guards at the time of seeking exemption 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 thereunder. Now, since after the
0
enactment of the State Act, the principal employer was
prohibited from taking private Security Guards from Security
Agencies, the exemption could be asked only in respect of
private Security Guards who satisfied the aforementioned three
conditions. Thus, it was only a one time exercise for seeking
E exemption for private Security Guards who were employed by
the agency and deployed by that agency in factory or
establishment. That exercise could be repeated as and when
the provisions of the Security Guards Act are made applicable
to different areas of the State on different dates as provided
F under Sub-section (3) of Section 1 of the Security Guards Act.
55. The discussion which we have in the preceding
paragraphs are reasons to come to the conclusion, and we hold
that there is no repugnancy between the State Act and the
G Central Act in the given facts. We have also found that the
Central Act does not occupy the field of labour welfare and
thereby there cannot be any conflict between the State Act and
the Central Act. The question of applicability of the Central Act
and the State Act, in our opinion, apply concurrently and we
H accept the submission of Mr. Grover to that extent relying upon
SECURITY ASSOCIATION OF INDIA v. UNION OF 919
INDIA [PINAKI CHANDRA GHOSE, J.]
the decisions cited before us (See: Vijay Kumar Sharma & A
Ors. vs. State of Karnataka & Ors. (supra), State of Uttar
Pradesh & Anr. vs. Synthetics and Chemicals Ltd. & Anr" 5 .]
and State of Bihar & Ors. vs. Shree Baidyanath Ayurved
Bhawan (P.) Ltd. & Ors. (supra). Furthermore, we have also
noticed that the State Act duly received the assent of the B
President. We have further noticed that Clause 28(1) of the
Scheme of 2002 provides that every registered principal
employer may either engage a security guard registered with
the Board or private employer agency or directly and the said
clause is nothing but declaratory of the object of the Act and c
the Scheme. Therefore, it cannot stand in the way of performing
the business by the private security agencies.
56. For the reasons stated hereinabove, we do not find
any merit in these appeals. Hence, the appeals are dismissed.
Consequently, the contempt petitions are also disposed of 0
accordingly. There will be no order as to costs.
Bibhuti Bhushan Bose Appeals dismissed &
Contempt Petition disposed of.
45. (1991) 4 sec 139.
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