Patna High Court
Md. Qasim Lari, Factory Manager ... vs Md. Shamsuddin And Anr. on 20 March, 1957
Equivalent citations: AIR1957PAT683, AIR 1957 PATNA 683
JUDGMENT Sinha, J.
1. This application has been made by the Manager, Sasamusa Sugar Works, Limited, who has been named as the Manager of the factory under Section 7 of the Factories Act.
2. Opposite Party No. 1 is the General Secretary of the Sasamusa Workers' Union and opposite party No. 2 claims to be one of the daily coolies employed by the Sasamusa Sugar Works, Limited.
3. On different dates a number of applications were filed by several persons including the opposite party claiming refund of the deductions made by the Sugar Works under Section 15 of the Payment or Wages Act (Act IV of 1936), before the District Magistrate, Chapra, who is the prescribed authority under the Payment of Wages Act. The matter came up to this Court on several occasions. On the last occasion the matter was remanded to the authority for decision of the preliminary point raised by the opposite party and other claimants in regard to the maintainability of the applications.
The petitioner on behalf of the Sugar Works contended that the applications were not maintainable because the opposite party as well as the other claimants had not made out a case of deduction from wages, and as such the prescribed authority had no jurisdiction to proceed under the Payment of Wages Act. When the matter went down, the prescribed authority has held that he has jurisdiction to proceed with the matter inasmuch as the claim is cognizable under the Payment of Wages Act.
4. The case of the opposite party is that opposite party No. 2 was entitled to Rs. 2-2-0 per day as wages, whereas he was paid at the rate of annas 10 per day, and, therefore, there was a deduction of Rs. 1-8-0 per day.
5. AS is found by the Court below it was not disputed before the Court that an Industrial Tribunal made an award fixing the pay of the employees of the Sasamusa Sugar Works at Rs. 2-2-0 per day and in pursuance of that award the management of the said Sugar Works came to an agreement that the employees would be paid Rs. 2-2-0 per day. The Court below has also held that Rs. 2-2-0 amounted as 'wages' as given in the Payment of Wages Act, and that as they were paid admittedly annas 10 per day, the balance out of Rs. 2-2-0 was deduction, and, therefore, the matter could be looked into under Section 15 of the Payment of Wages Act which will hereafter be referred to as the Act.
6. The only points urged by Mr. Sinha in support of the application are that as the aforesaid Sugar Works had at no point of time paid at the rate prescribed by the award, it could not be a case of deduction by the employer; and secondly, that as there were provisions in other Acts for recovery of claims under an award, the Court below had no jurisdiction to proceed under this Act.
7. The first question involves consideration of the definition of 'wages' given under the Act, but before I do so, I should like to refer to Section 15, the relevant part of it, under which the applications were made :
"15 (1).....
2. Where contrary to the provisions of this Act any deduction has been made from the wages of an employed person, or any payment of wages has been delayed, such person himself, or any legal practitioner or any official of a registered trade union authorised in writing to act on his behalf, or any Inspector under this Act, or any other persons acting with the permission of the authority appointed under Sub-section (1), may apply to such authority for a direction under Sub-section (3).
* * * * *
3. When any application under Sub-section (2) is entertained, the authority shall hear the applicant and the employer..... and, after such further inquiry (if any) as may be necessary, may, without prejudice to any other penalty to which such employer or other person is liable under this Act, direct the refund to the employed person of the amount deducted..... together with the payment of such compensation as the authority may think fit....."
8. For the application of this section, therefore, it must be held what the wages were, and whether there have been deductions from the wages, and whether those deductions were permissible under the Act.
9. Section 2, (vi) defines "wages" to mean "all remuneration, capable of being expressed in terms of money, which would if the terms of the contract of employment, express or implied, were fulfilled, be payable.....and includes any bonus or other additional remuneration of the nature aforesaid which would be so payable.....
but does not include....."
This definition as will be seen is couched in a very wide language, and if the terms of the contract of employment, express or implied, are fulfilled, the employee is entitled , to that remuneration. Now the question is whether a remuneration fixed by conciliation proceedings or by an award under the Industrial Disputes Act can be covered by the definition of "wages" as given in the Act. The principle behind the labour laws including the Industrial Disputes Act is the recognition of collective bargaining, and if I am right in that supposition, any wage fixed by the award of a tribunal or by a conciliation proceeding must necessarily mean the wages which, though not expressly agreed upon between the parties, must be taken to have been impliedly agreed upon between the parties.
At the time the employer enters into a contract with the employee and fixes certain remuneration, both the employer & the employee know that whatever be the contract in express terms In regard to remuneration, the employer is bound to pay the amount of remuneration mentioned in an award of a tribunal or fixed as per settlement in a conciliation proceeding under the Industrial Disputes Act, and the employee is entitled to that remuneration. As I have already mentioned in the Court below there was no dispute that a tribunal had made an award, fixing the pay of the employees at Rs. 2-2-0 per day.
In the petition reference is made to (paragraph 14) the award made on the 6th April, 1949, under the Industrial Disputes Act, 1947, which fixed Rs. 55 as the minimum wage payable by the Bihar Sugar Factories. It is not material for the purpose of the present application to hold whether Rs. 55 per month or Rs. 2-2-0 per day was fixed by the award or in other conciliation proceedings. That will be a matter for the Court below to decide on materials produced before that Court. I would, therefore, hold that the minimum wages fixed by the award or in conciliation proceedings are well within the definition of "wages" given in the Act.
10. Sections 7 to 13 of the Act refer to various permissible deductions from wages, and it is not the case of the petitioners that the present case is covered by any of those provisions. In that view, of the matter it must be held that the authority under Section 15 of the Act is entitled to entertain the application and proceed thereunder to give his decision.
11. Mr. Sinha referred in this connection to Modern Mills Ltd. v. R. Mangalvedhekar, AIR 1950 Bom 342 (A). This case, in my opinion, is not very material so far as the present case is concerned. In that case a certain employee of a mill had applied for payment to him of certain bonus which had been declared by an award of the Industrial Court made under Section 15 of the Payment of Wages Act after the applicant had ceased to be an employee of the mill. The authority under the Payment of Wages Act held in favour of the claimant. Thereupon the mill moved the High Court for a writ of certiorari against the order of the authority and this prayer was refused.
12. Another case to which reference is made is the case of V.B. Godse, Manager, Frabha Mills, Ltd. V.R.H. Naick, 1953-1 Lab LJ 577 (B). In that case it was decided (I am quoting from the placitum which correctly brings out the decision) :
"If the employee has served his master, carried out the terms of the contract, fulfilled his obligations and on that being done certain amount is payable by the employer to the employee, then that sum would be 'wages' within the meaning of the definition. Therefore, 'wages' do not only include the remuneration payable by the employer by reason of the terms of the contract, expressed or implied; it also includes any amount which the employer legally becomes liable to pay to the employee on the fulfilment of the contract.
Once the Industrial Court made the award (fixing higher wages and dearness allowance) the employer became legally liable to pay the additional wages and dearness allowance to the employees, and that such additional wages and dear-ness allowance amount to 'wages' within the meaning of Section 2 (vi) of the Act."
This decision, therefore, supports the view which I have taken.
13. Mr. Sinha, however, referred to the case of A.V. D'Costa v. B.C. Patel, (1955) 1 SCR 1353: ((S) AIR 1955 SC 412) (C). In this case the facts were entirely different. There a person worked as an employee of the Central Railway. Another person, junior to the claimant, had been promoted to a permanent job, and the claim was that the claimant was also entitled to payment at the same rate of scale applicable to the one promoted to a permanent job. In effect the grievance made by the applicant was that "he had not been paid wages on the scale to which he would have been entitled if he had been placed on the monthly wages scheme," and in that connection it was held by their Lordships that "the authority has the jurisdiction to decide what actually the terms of the contract between the parties were, that is to say, to determine the actual wages; but the authority has no jurisdiction to determine the question of potential wages. The respondent's complaint in the present case comes within the latter illustration."
"That case, therefore, is of no assistance to Mr. Sinha.
14. Another case to which reference was made is the case of Jogendra Nath Chatterjee and Song v. Chandreshwar Singh, AIR 1951 Cal 29 (D). In that case it was held as follows :
"It is quite clear from this definition (definition of 'wages') that wages consist of the amounts fixed by the parties by an agreement between them which resulted in a contract. It is true that the words used are "express or implied"..... We find it difficult to conceive how it can be said that the parties when they entered into the contract of employment agreed that if there was any industrial dispute between the employers and the employees and if the dispute was referred to the arbitration of an Industrial Tribunal and if the Industrial Tribunal increased the amount payable to the workman, the employer would pay such increased amount.
It seems to us that it would be very far-fetched if we are to take the view that these matters were in the minds of the parties when they entered into the contract. An implied term must be a term which was in the minds of the parties at the time of the contract and which although they did not so express they had agreed to carry out."
15. With great respect to their Lordships I find it difficult to agree. I have already said that if by an award or by means of a conciliation proceeding under the Industrial Disputes Act or by any other labour law certain wage is fixed which is binding on the employer, that wage must be deemed to have been impliedly agreed upon between the parties, because at the time when the contract was being made the parties must be deemed to know that if any award is made or if any settlement is arrived at under the Industrial Disputes Act, that is binding in law upon the employer and the employee.
16. In the result I would negative the contention of Mr. Sinha so far as the first point is concerned and hold that the authority is entitled to go into the matter.
17. So far as the second point is concerned, that is equally, in my opinion, devoid of substance, conceding that there is a remedy provided for in the Industrial Disputes (Appellate Tribunal) Act, 1950 (Act 48 of 1950) for recovery of any dues from an employer under an sward or decision (Section 20) or there may be some penalty provided for in the Industrial Disputes Act. I cannot for a moment be persuaded to hold that the remedy provided for by the Act is not available to the claimant from whose wages deductions have been made by the employer. If two remedies are provided, it is open to the person aggrieved to make his election, and if in the Present case the claimants have chosen to seek the forum provided for in the Payment of Wages Act, it cannot possibly be held that the authority under the Payment of Wages Act should refuse to exercise his jurisdiction under the Act. In that view of the matter in my opinion, the second contention also of Mr. Sinha is of no help to him.
18. In the result, the rule is discharged, and the application is dismissed with costs: hearing fee Rs. 32.
Dayal, J.
19. I agree.