Chandra Bhavan Boarding and Lodging v. State of Mysore (1969) 3 SCC 84

CHANDRA BHAVAN BOARDING AND LODGING V. STATE OF MYSORE

Whether the Minimum Wages Act, 1948 (“the Act”), which allows the government to fix minimum wages, violates the fundamental rights of employers under Article 19(1)(g) (right to practice any profession, or to carry on any occupation, trade, or business) and Article 14 (right to equality) of the Indian Constitution?
Whether the Act constitutes an unreasonable restriction on the freedom of trade and business?
Whether the principle of natural justice is applicable in this case?

The right to carry on business is subject to reasonable restrictions in the interest of social justice and the welfare of workers, and the Minimum Wages Act, 1948, is a legitimate exercise of this principle.
The question of whether a particular principle of natural justice applies in a case depends on the facts and circumstances of each case.

The case revolves around the validity of a notification issued by the State government of Mysore under the Minimum Wages Act, 1948.
The notification aimed to fix the minimum wages for different classes of employees in residential hotels and eating houses within the state.
The State government has the authority to determine minimum wages after collecting relevant data and consulting with advisory committees.
The Appellants challenged the notification on grounds of alleged violation of Articles 14 and Article 19(1)(g) of the Constitution before the High Court of Mysore, which rejected the petition.
The Appellant preferred an appeal before the Supreme Court against the decision of the High Court of Mysore, giving rise to the instant case.
The Appellants argued that the government’s failure to appoint a committee under Section 5(1)(a) of the Act for advice rendered the fixation of minimum wages arbitrary, violating the principles of natural justice.

The Supreme Court held that the Minimum Wages Act, 1948, does not violate the fundamental rights of employers under Article 19(1)(g). The Act was deemed to be a reasonable restriction in the interest of the public.
The Supreme Court held that the government’s discretion to choose procedure under the Act is not arbitrary or violative of Article 14.
Further, the Supreme Court upheld the government’s power to fix minimum wages as it aims to ensure that workers receive fair wages and are not exploited by employers.
The constitutional validity of the notification fixing minimum wages for employees in residential hotels and eating houses was upheld by the Supreme Court.
The Supreme Court held that the notification is not rendered invalid by reason of non-constitution of committee under Section 5 of the Act.
In the particular facts and circumstances of the case, the Supreme Court found that the procedure adopted by the government in issuing the notification was adequate and effective. As such, there is no violation of the principles of natural justice.
The Supreme Court dismissed the appeal, while granting a six-month extension to the owners of residential hotels and eating houses for payment of arrears of minimum wages accrued with 6% interest per annum.