Wage fixation must reflect real capacity to pay; arbitrary classification invalidated for one establishment but upheld for another.

Wage fixation under the statute must rest on relevant classification and the employer's real capacity to pay. The SC held that the Wage Board's placement of Press Trust of India in a higher class, despite its revenue position, and its assumption that a heavy wage burden could be met by increased subscriptions and tighter organisation, made the recommendation arbitrary and discriminatory; the fixation was struck down for that establishment. By contrast, Indian National Press failed to show more than a small deficit between profits and the wage burden, which was insufficient to invalidate the wage fixation, so the challenge failed there. The impugned order was invalid only as against Press Trust of India.

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Issues: (i) Whether the Wage Board's classification of the Press Trust of India in Class II and the fixation of wages for it were arbitrary, discriminatory, and beyond the establishment's capacity to pay, rendering the Central Government's order invalid; (ii) whether the Indian National Press had shown sufficient grounds to invalidate the wage fixation applicable to it.

Issue (i): Whether the Wage Board's classification of the Press Trust of India in Class II and the fixation of wages for it were arbitrary, discriminatory, and beyond the establishment's capacity to pay, rendering the Central Government's order invalid.

Analysis: The classification adopted by the Wage Board was required to rest on relevant criteria, including gross revenue and capacity to pay, and to satisfy the test of reasonable classification. The material before the Court showed that the Press Trust of India had been placed in a higher class notwithstanding its revenue position, while the Board itself recognised that the financial burden of its recommendations was heavy and assumed, without adequate basis, that the burden could be met by increasing subscriptions and tightening the organisation. The recommendations also went beyond the scale asked for by the employees, and the statutory procedure required the Board to consider the representations before making its recommendations. On these facts, the impugned fixation was held to be arbitrary and discriminatory and not justified by the establishment's financial capacity.

Conclusion: The challenge succeeded in relation to the Press Trust of India, and the wage fixation was struck down in its case.

Issue (ii): Whether the Indian National Press had shown sufficient grounds to invalidate the wage fixation applicable to it.

Analysis: The only objection raised by the Indian National Press was a comparatively small deficit between average profits and the annual wage burden. The Court found that this did not establish inability to meet the wage increase, particularly as the establishment had been placed in the appropriate class and no other substantial ground of challenge was made out.

Conclusion: The challenge failed in relation to the Indian National Press.

Final Conclusion: The impugned order was invalid only as against the Press Trust of India, but it remained undisturbed in relation to the Indian National Press.

Ratio Decidendi: Wage fixation under the statute must be based on relevant classification and the employer's real capacity to pay; an arbitrary elevation of an establishment to a higher class, or a recommendation exceeding that capacity, is vulnerable to constitutional challenge.

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