Madras High Court
Tneb Workers Progressive Union vs The Tamil Nadu Electricity Board on 10 April, 2014
Author: C.S.Karnan
Bench: C.S.Karnan
IN THE HIGH COURT OF JUDICATURE AT MADRAS CAV ON 11/01/2013 DATED: 10/04/2014 CORAM THE HONOURABLE MR.JUSTICE C.S.KARNAN W.P.No.46828 of 2002 TNEB Workers Progressive Union, rep. by it's General Secretary, (Registration No.38 CPT) 800 Anna Salai, Chennai-600 002. ... Petitioner vs. The Tamil Nadu Electricity Board, rep.by it's Chairman, No.800, Anna Salai, Chennai-600 002. ... Respondent PRAYER: Writ Petition filed under Article 226 of the Constitution of India for a Writ of Certiorari to call for the records of the order passed by the respondent, in Clause 3(ii) of (Permanent) BP(FB) No.58 (Secretariat Branch), dated 18.07.1998, in so far as it grants D.A., to the employees of the respondent Board from the same date as granted by the State Government to their employees and consequently the order of the respondent in Proceedings TNEB Order (Permanent) No.58 (FB) (Secretariat Branch), dated 29.10.2002, quash the same and consequently to direct the respondent Board to grant D.A., to the employees of the Board at the rate of 49% from 01.01.2002 and 52% from 01.07.2002. For Petitioner : Mr.Balan Haridas For Respondent : Mrs.R.Varalakshmi Standing Counsel for TNEB * * * * * O R D E R
The prayer in the writ petition is for issuance of a writ of certiorari to quash the order, dated 18.07.1998, passed by the respondent Board, in so far as Clause 3(ii) of (Permanent) BP(FB) No.58 (Secretariat Branch), which grants dearness allowance to the employees of the respondent Board from the same date as granted by the State Government to their employees and the consequent order, dated 29.10.2002, passed by the respondent Board and to direct the respondent Board to grant dearness allowance to the employees of the Board at the rate of 49% from 01.01.2002 and 52% from 01.07.2002.
2. The short facts of the case are as follows:
The petitioner Union is a registered Union under Trade Unions Act, 1926 and it is also a recognized Union under the code for discipline in industry and is the largest Union the Electricity Board and it represents most of the employees working in the Electricity Board. The membership of the Union is more than 20,000. The pay and allowances of the employees of the Board are fixed and revised by various settlements, which are made either under Section 12(3) or 18(1) of the Industrial Disputes Act (hereinafter, referred to as 'the Act') and as per these settlements, dearness allowance is to be revised on the basis of the consumer price index every six months and the dearness allowance will be paid in cash along with pay and allowances, which the employees are entitled to draw every month.
3. Further, the petitioner Union submits that by proceedings, dated 04.06.1992, in (Permanent) B.P.(Ch) No.83, Secretariat Branch, the Board decided that for the period from 01.01.1992 to 30.04.1992, the additional installments of dearness allowance would be credited to the General Provident Fund Account of these employees instead of paying the same in cash. The said order was challenged by five Unions including the petitioner Union by filing W.P.Nos.8574, 8575, 8576, 8577 and 8578 of 1992, before this Court and this Court, by order dated 15.10.1992, took a view that as long as the settlement is in force, both parties are bound by the settlement and one of the parties cannot unilaterally transgress with the terms of the settlement or ignore the same. Further, this Court held that Clause-4 referred to in the settlement does not enable the respondent Board to make payment in the mode adopted by the Government, but only direct that the formula, which is followed by the Government, should be adopted by the Board and this is only for the purpose of calculating the dearness allowance on the basis of the consumer price index. In other words, this Court took a view that the Board had wrongly interpreted the terms of the settlement to mean that even the mode of payment of dearness allowance would be the same as adopted by the Government.
4. The petitioner Union further submits that after the order, dated 15.10.1992, passed by this Court, a settlement was entered into for the period from 01.12.1992 to 30.11.1996 stating that dearness allowance will be sanctioned twice a year i.e., on 1st January and 1st July, taking into account the variations in the previous 12 months of the average of the All India Consumer Price Index Number, adopting the same formula adopted by the Government of Tamil Nadu and the mode of payment of additional installments of dearness allowance will also be on the same pattern as ordered by the Government of Tamil Nadu. Thus, this settlement not only settles the manner of calculation of the dearness allowance, but also sets out the mode of payment of the additional installments of dearness allowance by making it clear that the mode of payment would depend upon the mode adopted by the Government of Tamil Nadu. For the entire period, when this settlement was in force, the Government was paying the additional installments of dearness allowance in cash to the Government servants and therefore by virtue of this settlement, the employees of the Board were also receiving the additional installments of dearness allowance in cash.
5. Further, the petitioner Union submits that after the expiry of the settlement, a draft settlement was proposed by the Board and circulated to the Union stating that the mode of payment of additional installments of dearness allowance will also be on the same pattern as followed by the State Government. During the negotiations between the Union and the Management, one of the demands of the Union was that the mode of payment should not be based on the mode adopted by the Government of Tamil Nadu and therefore a request was made to the Board to delete this sentence in Clause 5 of the proposed settlement. Both the parties agreed that the sentence would be deleted and hence while arriving at the final settlement, the settlement did not talk about the mode of payment, but only stated that the dearness allowance will be revised twice a year taking into account the variations in the previous 12 months average of the All India Consumer Price Index Number, adopting the same formula as followed by the State Government. This settlement was entered into on 08.07.1998 and is effective for the period from 01.12.1996 to 30.11.2000. Clause 5 of the settlement, dated 08.07.1998, reads as under:
The revised rate of Dearness Allowance for various pay ranges will be as indicated in Annexure-3. The D.A., rates will be revised twice in a year, on 1st January and 1st July, taking into account the variations in the previous 12-Month average of the All India Consumer Price Index Numbers adopting the same formula as followed by the State Government.
6. The petitioner Union further submits that on the basis of the said settlement, the respondent issued proceedings, dated 18.07.1998. However, in respect of dearness allowance, a slight deviation was made from the settlement and the paragraph relating to dearness allowance reads as follows:-
The existing pay structure has been revised by All India consumer Price Index of 1510 points and the revised D.A., will be sanctioned to the employees of the Board as granted by the State Government to their employees at the same rate and from the same date. Though the settlement has stated that the same formula as followed by the State Government shall be adopted, the variation made in the Board's proceedings was that the payment will also be form the same day. However, though the Board proceedings were issued on 18.07.1998, it did not affect the members of the petitioner Union since for all these years, the dearness allowance was given for the whole year in two installments, once in six months.
7. Further, the petitioner Union submits that for the year 2002, the State Government did not pay the dearness allowance to it's employees during January 2002 and July 2002. Negotiations were conducted between the Government employees and the State Government and pursuant to the negotiations, the State Government took a decision to pay the dearness allowance from 01.10.2002 onwards. Following the said decision, the respondent Board has not issued a direction on 29.10.2002, in which they have stated that the employees of the Board will also get dearness allowance only from 01.10.2002. Moreover, they have also stated tin the order, dated 29.10.2002, that the dearness allowance will be paid at 49% of basic pay with effect from 01.10.2002. In the case of Central Government servants, they have received dearness allowance at the rate of 49% in respect of the first installments paid from January 2002 and in respect of the second installment, they have received at the rate of 52% from 01.07.2002. The State Government is following the All India Consumer Price Index Number and therefore there has been a deviation from this index also. Though the settlement, dated 08.07.1998, was for the period upto 30.11.2000, no fresh settlement has been entered into and therefore the same terms and conditions of the earlier settlement continues to be in force. As stated earlier, the petitioner Union did not have any occasion to challenge the Board's proceedings, dated 18.07.1998 and only after issuance of the impugned order, dated 29.10.2002, the cause of action has arisen to challenge the impugned proceedings, dated 18.07.1998 and hence the petitioner Union filed this writ petition seeking the relief as stated above.
8. The respondent has filed his counter affidavit stating that there are about 85,000 workmen, governed by the Industrial Disputes Act, 1947, working in Tamil Nadu Electricity Board throughout the State of Tamil Nadu. Among them, the petitioner Union has claimed to be representing 20,000 and the petitioner Union is put to strict proof of the same. Further, the petitioner Union is one among the Unions recognized under Board's Rule and not a Union recognized under the Code of Discipline in Industry. This writ petition is not maintainable as the payment of dearness allowance to the employees of the Tamil Nadu Electricity Board is only governed by Wage Settlement and the petitioner Union being a party to that settlement. The petitioner Union being a party to the settlement may well raise a dispute, if it is aggrieved against any violation of the terms of the settlement regarding the payment of dearness allowance before the appropriate forum. Therefore, this writ petition is not maintainable.
9. The respondent-Board further submits that the petitioner Union has referred to orders, dated 16.10.1992, in W.P.Nos.8574 to 8578 of 1992 and dated 11.08.1999, in W.P.Nos.10474, 11710, 11716, 11717 & 12704 of 1999 respectively, wherein the Union had challenged the orders issued by respondent Board in (Per.) B.P.(Ch) No.83, (S.B), dated 04.06.1992. The relevant portion of the order, dated 16.10.1992, in W.P.Nos.8574 to 8578 of 1992 is extracted hereunder:
(4) In short, the contention of the petitioners is that under the Settlement, the respondent is bound to pay the dearness allowance in cash and the respondent cannot unilaterally alter the mode of payment and direct the crediting of the amount to the General Provident Fund Account.
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(6) There is no substance in the arguments advanced by the respondent. The settlement, as long as it is in force, will govern both the parties. One of the parties cannot unilaterally transgress the terms of the agreement or ignore the same. Clause-4 referred to above does not enable the respondent to make the payment in the mode adopted by the Government. Clause-4 only directs that the formula, which is followed by the Government should be adopted by the Board and that is only for the purpose of calculating the dearness allowance on the basis of the Price Index and nothing more than that. Hence, the contention that the respondent is bound to adopt the method followed by the Government for payment is without any substance.
(7) There is also no substance in the contention that there is no express clause in the settlement directing payment of dearness allowance in cash. The statutory provisions relating to payment of wages are clear and they will certainly govern the position. Section 2(rr) of the Industrial Disputes Act defines 'wages' as meaning all remuneration capable of being expressed in terms of money and including such allowances (including dearness allowance), as the workmen is for the time being entitled to. Section-6 of the payment of Wages Act provides that all wages shall be paid in current coin or currency notes or in both. A proviso was introduced in 1976. Under that proviso, the employer may, after obtaining the written authorization of the employed person, pay him the wages either by Cheque or by crediting the wages in his bank account. The payment of Wages Act also defines 'wages' as meaning all remuneration (whether by way of salary, allowances or otherwise) expressed in terms of money or capable of being so expressed which would, if the terms of employment, express or implied, were fulfilled be payable to a person employed in respect of his employment or of work done in such employment. There is a similar provision in the Tamil Nadu Shops and Establishments Act, 1947, which would certainly apply to the respondent Board. Section 33 of the said Act provides that all wages shall be paid in current coin or in currency notes or in both. In the face of these statutory provisions, it is not open to the respondent to contend that in the absence of a specific clause in the bipartite settlement directing the payment of dearness allowance in cash, the respondent Board is not bound to pay it in cash and is entitled to credit the same in some other account, to be paid in future.
(8) In the circumstances, the writ petitions have to be allowed and they are hereby allowed. The order passed by the respondent in (Per) B.P.(Ch) No.83 (SB, dated 04.06.1992 is quashed. The respondent is directed to pay the amount of dearness allowance as calculated in accordance with the provisions of Clause-4 of the bipartite settlement, dated 31.07.1999, to the members of the petitioner Union immediately. There will be no order as to costs. The relevant portion of the order, dated 11.08.1999, in W.P.Nos.10474, 11710, 11716, 11717 & 12704 of 1999 is extracted hereunder:
(4) The only controversy that arises for consideration is as to (i) Whether the action of the respondent Electricity Board in directing the arrears of dearness allowance payable to the employees with effect from 1st May, 1999 to be credited to the Provident Fund Account of the employees is valid? (ii) Whether the arrears of Dearness Allowance should be paid in Cash to the employees?
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(10) With respect to the payment of Dearness Allowance in Cash with effect from 1st May, 1999, there is no controversy. The controversy is with respect to the arrears of Dearness Allowance payable for the period from 1.1.1999 to 30.04.1999. Identical question was raised in the earlier Batch of Writ Petitions and SRINIVASAN, J, as he then was, after considering the terms of the settlement, the provisions of the Payment of Wages Act, the provisions of the Tamil Nadu Shops and Establishments Act, the provisions of the Industrial Disputes Act, held that it is not open to the respondent Board to defer the payment or to contend that respondent Board is entitled to credit the arrears of Dearness Allowance in some other account to be paid in future.
(11) In my considered view and on the facts of this case, there being a difference only as to the period for which the Dearness Allowance is payable and in other respects, there being no difference at all and as such the said decision of SRINIVASAN, J., squarely applies to the facts of the present case. I am in respectful agreement with the pronouncement of SRINIVASAN, J., as he then was.
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(14) It is to be pointed out that the settlement entered between the petitioner-Union and the respondent Electricity Board in noway enables the respondent to postpone the payment of Dearness Allowance or to credit the same to the Provident Fund of the respective employee. It is incumbent on the part of the respondent to pay the Dearness Allowance along with the salary for each month. Merely because announcement is being made on a later date for the earlier period, there is no justification at all to postpone the payment or credit arrears of Dearness Allowance to the Provident Fund Account unless such a course is agreed to by the individual employee or the Settlement between the employer and the employees provides for the same.
(15) Concedingly, there is no stipulation in the Settlement and the respondent Board should have been vigilant and taken care and insisted for a stipulation being incorporated with respect to the arrears. It may be that the credit of arrears of Dearness Allowance for the past period to the Provident Fund Account of the employees would be in the interest of the individual employee or laudable, but it is for the employee to decide as to whether he wants immediate payment or the amount to be credited to his Provident Fund account as ultimately all accruals in the Provident Fund Account definitely goes to the hands of the employee. Having failed to introduce a stipulation in the Settlement, it is not open to the respondent to credit arrears of Dearness Allowance for the earlier period to the credit of Provident Fund Account of the respective employee and such a course is not in conformity with various statutory provisions such as Payment of Wages Act, Tamil Nadu Shops and Establishments Act as well as the provisions of the Industrial Disputes Act.
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(17) The respondent Board will be justified in crediting the arrears of Dearness Allowance in question if the individual had given a consent or Section 12(3) Settlement provides for the same. In this case, concedingly there is no such agreement or stipulation, nor there is any request or consent by the individual worker. In the circumstances, following the earlier decision of SRINIVASAN, J., in W.P.No.8574 to 8579 of 1992, all these writ petitions deserve to be allowed.
(18) In the circumstances, all the above writ petitions are allowed, but subject to the following decisions:
(i) Wherever the individual employee confirms and accepts the credit of arrears of Dearness Allowance to his Provident Fund Account, the same need not be withdrawn by the respondent Board and the individual employee may be permitted to avail a loan or part payment as and when he is eligible for the same.
(ii) the respondent Board shall withdraw the arrears of Dearness Allowance credited to the Provident Fund account of the individual employee after getting a written request from employee and disburse the same and all such disbursements shall be effected within three months from the date on which the individual employee of the respondent Board makes a request to his Pay Drawing Authority.
It could be seen from the above that the orders of this Court were only against crediting of the arrears of Dearness Allowance sanctioned, in the respective Provident Fund Account of the employees. This Court in the above writ petitions had ordered to make payment of the arrears in cash and restrained the Board from deducting any portion of the Dearness Allowance and crediting the same in the G.P.G., account of all workmen. Nowhere in the said orders of this Court, it has been stated that the Board may issue orders revising the Dearness Allowance without waiting for the issuance of orders by the State Government in this regard.
10. The respondent-Board further submits that the factual details of the position indicated in the affidavit of the petitioner are not denied. The relevant terms in the settlement, dated 08.07.1998 and the relevant portion of the consequential orders issued in pursuance of the said settlement, referred in the affidavit are as follows:
......The Dearness Allowance rates will be revised twice in a year on 1st January and 1st July taking into account the variations in the previous twelve months average of the All India Consumer Price Index numbers, adopting the same formula as followed by the State Government.
........the revised Dearness Allowance will be sanctioned to the employees of the Board as granted by the State Government to their employees at the same rates and from the same date. The increases in Dearness Allowance, which fell due with effect from 01.07.1998, 01.01.1999, 01.07.1999, 01.01.2000, 01.07.2000, 01.01.2001 and 01.07.2001 were all paid as per the above agreed term only.
11. The respondent-Board further submits that the Dearness Allowance payable from time to time is covered by the terms in the settlement, dated 08.07.1998. The Board was awaiting the orders of the State Government on the rate and effective date to be followed and the formula being adopted by the State Government. When the orders of the State Government were issued, the Tamil Nadu Electricity Board also adopted the orders of the State Government and ordered for the payment of enhanced Dearness Allowance with effect from the same date of 01.10.2002 and at the same rate of 49% in Cash in full without crediting any portion of the increase in Dearness Allowance into General Provident Fund account of the employees. The orders of this Court, dated 16.10.1992 and 11.08.1999 relate to payment of arrears of Dearness Allowance in Cash instead of impounding the arrears of Dearness Allowance and crediting to the General Provident Fund account of the employees concerned. The above orders of this Court were obeyed and no portion of the increase in Dearness Allowance was ordered to be credited into the General Provident Fund account of the employees. Thus, the respondent Board has acted only in the manner envisaged under the provisions of the Settlement and the petitioner Union has no reason to feel aggrieved upon this. The Tamil Nadu Electricity Board has been following the same procedure in sanctioning Dearness Allowance to it's employees based on the orders of the State Government as and when issued in the matter. This procedure has been well received by all concerned including the petitioner Union. Therefore, even in terms of the provisions contained in the Settlement dated 08.07.1998, the Board has to wait for the orders of the State Government in the matter and Board has awaited for the same and issued orders on receipt of Government orders. The position being as such, the insistence of the petitioner Union to consider it's submissions compelling the Board to sanction the revision of Dearness Allowance from 45% to 49% with effect from 01.01.2002 and 52% with effect from 01.07.2002 without reference to the settlement provision and without waiting for the orders of the State Government in the matter is untenable. The respondent Board is bound to act only in the manner expected by the provisions of the Settlement and the settled practice followed hitherto in the matter of sanction of revision of Dearness Allowance and not in any other manner sought for by the petitioner Union. There was no failure on the part of the respondent Board to sanction revision of Dearness Allowance in the past and the latest revision with effect from 01.10.2002 was also ordered without any delay.
12. The respondent-Board further submits that the rate and formula that could be adopted by the Government for the payment of Dearness Allowance with effect from 01.07.2002 @ 52% will be known to the Board only after issuance of orders by the State Government in this regard. In view of the above and in terms of the provisions contained in the settlement, the Board has to wait for the orders of the Government in this matter. The action of the respondent Board is only accordance with the law and not contrary to law as stated by the petitioner Union and the respondent Board has acted only in terms of the settlement. The Board has fulfilled it's commitment by issuing orders in (Per) B.P.(FB) No.58 (SB), dated 29.10.2002, for payment of enhanced Dearness Allowance at the rate of 49% to it's employees as was allowed by the Government to their employees, but without crediting any portion of the increase into the General Provident Fund account of the employees. If the petitioner Union in any case feel aggrieved, it has to seek remedy only in the appropriate forum and cannot invoke the jurisdiction of this Court under Article 226 of the Constitution of India. Hence, he prays this Court to dismiss this writ petition.
13. The highly competent counsel Mr.Balan Haridas appearing for the petitioner-Union submits that the respondent-Board is liable to pay Dearness Allowance to the employees at the rate of 49% from 01.01.2002 and 52% from 01.07.2002. The pay and allowance of the employees are revised by various settlements made among them. As per these earlier settlement, the D.A. is to be revised on the basis of consumer price index, every six months. The same was not done by the Board.
14. The highly competent standing counsel Mrs.R.Varalakshmi appearing for the respondent-Board submits that the petitioner-Union and the respondent-Board have already made a settlement on 18.11.2009, wherein the Union Office bearers had signed along with the respondent. If the petitioner Union is aggrieved as per the terms and conditions of the settlement, their remedy is before the appropriate forum. Further, similar issues had already been challenged by employees by way of separate writ proceedings and the same was dismissed. As such, the above writ petition is not maintainable.
15. On considering the facts and circumstances of the case and arguments advanced by the highly competent counsels on either side and on perusing the typed-set of papers, this Court does not find any discrepancy in the impugned order passed by the respondent. Hence, the above writ petition is dismissed. There is no order as to costs.
10/04/2014
Index : Yes.
Internet : Yes.
r n s
To
The Tamil Nadu Electricity Board,
rep.by it's Chairman,
No.800, Anna Salai,
Chennai-600 002.
C.S.KARNAN, J.
r n s
Pre-Delivery Order in
W.P.No.46828 of 2002
10 /04/2014