Indian Kanoon - Search engine for Indian Law

Section 37 A&C Act Section 34

2. The Awards assailed in the Impugned Judgment directed the Appellants to pay wage arrears along with interest and costs on the footing that arrears were payable w.e.f. 01.01.1997, and that the Appellant could not deny such arrears by relying upon the Department of Public Enterprise (DPE) Guidelines and/or Presidential Directives (PD) to contend that payments were only prospective or contingent. The Appellants assailed the Awards alleging that the Arbitral Tribunal [hereinafter referred to as „Tribunal‟] exceeded the scope of reference, disregarded binding PDs governing pay revision, and rendered findings contrary to the contractual settlements. However, the learned Single Judge dismissed the Appellants‟ Section 34 Petitions, reiterating the limited scope of interference under Section 34 and rejecting the grounds urged to assail both liability and the interest component.

6. On 14.01.1999, the DPE called for the commencement of the Sixth Round of Wage Negotiations in Public Sector Enterprises (PSEs) and issued DPE Guidelines therefor. The Managements of these aviation PSEs were now charged with conducting wage negotiations with their respective workers in accordance with the DPE Guidelines. In the aforesaid guidelines, it is noted that wage negotiations for Central PSEs had fallen due on 01.01.1997. It is clearly recorded in the DPE Guidelines that the Managements were at liberty to implement the negotiated wages after verifying with DPE and the concerned Ministry that the revisions were within approved parameters and not in conflict with the wage revisions of officers and non-unionized supervisors.

7. Subsequently, on 25.06.1999, the DPE further supplemented the earlier guidelines by issuing OM No. 2(49)/98-DPE(WC), which, inter alia, provided that:

i. In enterprises that had adopted pay scales different from those prescribed by the DPE, or had granted increment rates higher than those stipulated, the Management could introduce intermediary scales or suitably modify the prescribed scales, provided that the minimum and maximum limits of each pay scale remained unchanged, and such modifications were effected only in consultation with the concerned administrative Ministries and the DPE; and ii. All Ministries/Departments were required to issue PDs in the format set out in Annexure IV to the OM, prescribing ceilings for pay scales and perquisites and providing for dearness allowance. The DPE Guidelines further stipulated that the next pay revision would be due after a period of ten years.

50. Further, the learned Single Judge has also correctly noted that the DPE Guidelines dated 14.01.1999 and 25.06.1999 consistently proceeded on the premise that revised wages were payable w.e.f. 01.01.1997 and only required PDs to prescribe ceiling limits, leaving actual payments to the enterprise‟s capacity to pay. The introduction of "notional fixation" by the PD was not expressly contemplated by the DPE Guidelines and effectively deferred a benefit which had already accrued. The Tribunal was therefore justified in examining whether such deferment could defeat the employees‟ entitlement.