Karnataka High Court
Spun Silk Mills vs Parthasarathy And Ors. on 20 February, 1996
Equivalent citations: [1997(75)FLR71], ILR1996KAR2497, 1996(5)KARLJ487
ORDER Kumar Rajaratnam, J.
1. These Writ Petitions are taken up with consent of the parties. Notice to R-21 dispensed with.
2. The petitioner is a Corporation owned by the Government of Karnataka. According to petitioner, the respondents before this Court requested the petitioner-Management to purchase consumer durables on instalment basis. The petitioner had discussion with M/s. Nagarjuna Investment Trust Ltd, Hyderabad which is a private agency in respect of extension of finance to the employees under hire purchase scheme for purchase of consumer durables. The said Company came forward to extend the facilities. The Management agreed to remit the amount after recovering from the employees in instalments to the investment Corporation. The Management put up a notice on the Notice Board dated 18/19.7.1990 informing the employees to submit their applications for availing the benefit on or before 20.7.1990. About 82 employees at Channapatna came forward to avail the benefit of the scheme and signed the requisite forms. The said 82 employees purchased TV sets from a reputed Company M/s. Dyanora Ltd., through the agency of M/s. Mohini Electronics, Bangalore. It is also stated that the prices of the TVs differed from set to set. The respondents were required to pay the instalment amount on the date of receiving their salary every month from the Management. The Management was remitting it to the financial agency. The respondents paid 7 instalments due under the hire purchase without any demur. However, subsequently they filed a complaint of illegal deductions from their salaries before the III Additional Labour Court, Bangalore on the ground that the payment of Wages Act does not authorise such deductions from their salaries and claimed refund of deductions already made. The application was allowed which is the subject matter of Writ Petition filed by the Management.
3. The learned counsel for the petitioner-Management submits that the scope of Section 33(C)(2) of the I.D. Act is very limited and on the facts and circumstances of this case, no application could be made under Section 33(C)(2) of the I.D. Act. He also submitted that the workmen had voluntarily agreed to an agreement and also had authorised the Management to deduct the amount which had been advanced for purchase of the T.V. by hire-purchase company. In the light of authorisation, the Management had acted by means of a contractual agreement to deduct the amounts that were due for the purchase of the T.V. set.
4. The learned Counsel for the petitioner relied on Section 7(2)(f) of the Payment of Wages Act and submits that such deductions are possible under Section 7(2)(f).
Section 7(2)(f) reads as follows :
"7(2) Deductions from the wages of an employed person shall be made only in accordance with the provisions of this Act, and may be of the following kinds only, namely :
(a) xxx xxx xxx
(f) deductions for recovery of advances of whatever nature (including advances for travelling allowance or convenience allowance), and the interest due in respect thereof, or for adjustment over payments of wages;"
In my view the facts and the circumstances of the case would bring the deductions by the Management under Section 7(2)(f) of the Act. It is also my view that this is not a fit case which falls within the scope and ambit of Section 33(C)(2) of the I.D. Act since the respondent by a private treaty had entered into an agreement for purchasing the T.V. set and the consideration having been passed, they are bound by the agreement entered into between them and the financial Company. It is a voluntary act whereby the respondents had the advantage of purchasing the T.V. set on hire-purchase agreement. The reasoning of the Labour Court is contrary to the legal position stated above. Therefore, the order dated 13.7.1995 passed by the III Additional Labour Court in Application Nos. 41-47/93 and 50/93 (Annexure-A) is set aside. No order as to costs.