1. This petition is by the employer of Silk-printing factory against the award of the industrial tribunal dated November 15, 1963. The dispute is between the employer on the one hand and the employees of the other petitioner on the other. Respondents 3 and 4 are two of the workers representing the workers of the petitioners' firm. On July 31, 1956 there was an agreement between the employees and the employers regarding wage-scales and classification. Under this agreement wages for different classes of employees were fixed. It appears that by a notice the employers terminated the agreement on May 1, 1959 on the ground of stringent financial circumstances. The workmen made a demand for revision of the scales and other matters and accordingly a reference was made on January 27, 1963. They had made five demands and all these were referred to the industrial tribunal. They were as follows :
(1) All the workmen should be classified and paid basic wages as per the scheme of wages in the annexure.
(2) All the workmen be paid dearness allowance at the rate of 95 per cent neutralization of the rise in the cost of living over the pre-war period.
(3) All the workmen be given twelve days' casual leave with pay every year.
(4) All the workmen be given fifteen days' sick leave with pay every year.
(5) Demands (1), (2) and (4) be granted with retrospective effect from May 1, 1962.
2. The tribunal did not think it necessary to reclassify the employees, nor did it make any change in the structure of wages; but awarded eighty paise per day for the daily rated workers as dearness allowance and Rs. 20.80 per mensem for the monthly-rated. As to demand (3) he granted four days' casual leave. As regards demand (5) he rejected it and apparently also the demand (4). The petitioners seek to challenge the award.
3. The first contention made by Sri Phadke is that the tribunal had no authority or jurisdiction to grant something which was never demanded and in respect of which no reference was made. A complaint was made during the hearing to the tribunal that increments due to the workmen under the agreement of July 31, 1956 were stopped by the petitioners. The tribunal directed that the arrears of the increments due under the agreement which were withheld should be paid within two months of the publication of this award. It is argued that this, not being one of the matters referred to the tribunal, should not have been allowed. The real method of recovery for these affected workmen was to approach other tribunals but not make a grievance in the present proceedings. There is justification in this comment.
4. The learned counsel for the respondents though he attempted to support the award in this respect, could not urge any valid reason against the same.
5. It is then argued by Sri Phadke that the tribunal, while increasing the dearness allowance, has ignored the principles laid down by the Supreme Court in connexion with these matters. He referred to us the decision of the Supreme Court in Express Newspapers and others v. Union of India and others : (1961)ILLJ339SC wherein the following principles were formulated :
'(1) That in the fixation of rates of wages which include within its compass the fixation of scales of wages also, the capacity of the industry to pay is one of the essential circumstances to be taken in to consideration except in cases of bare subsistence or minimum wage where the employer is bound to pay the same irrespective of such capacity;
(2) that the capacity of the industry to pay is to be considered on an industry-cum-region basis after taking a fair cross-section of the industry; and
(3) that the proper measure for gauging the capacity of the industry to pay should take into account the elasticity of demand for the product, the possibility of tightening up the organization so that the industry could pay higher wages without difficulty and the possibility of increase in the efficiency of the lowest-paid workers resulting in increase in production considered in conjunction with the elasticity of demand for the product no doubt against the ultimate background that the burden of the increased rate should not be such as to drive the employer out of business.'
6. Now the tribunal, while determining this question, accepted that the financial position of the company was not very reassuring and for that purpose relied upon the fact that it had made losses in 1956 of Rs. 7,000; in 1957 of Rs. 50,000; in 1958 of Rs. 10,000; in 1961 of Rs. 8,000 and in 1962 of Rs. 37,945 while in 1959 it made a profit of Rs. 9 and in 1960 a profit of Rs. 32,000. One must sometime wonder as to whether any private firm would continue to work at heavy loss for such a continuous period. How the balance sheet is made is not for us to say. It is a matter for workers to raise before the tribunal and if this finding is correct, then evidently the tribunal had to regard this aspect as a very important aspect in deciding the question as to what should be the relevant wages.
7. Sri Sowani on behalf of the respondents made a suggestion that the accounts may not be correct. That is, however, a contention which cannot be allowed to be raised here in this petition. The second contention urged by Sri Phadke is that the tribunal has not only not considered the first aspect of the matter but has also not considered the second principle formulated in the Supreme Court judgment referred to above. Sri Sowani pointed out that on behalf of the union a statement was produced at Ex. E. showing the wage-scales in comparable concerns, while on behalf of the petitioners nothing was produced to show that in any of the concerns the wages were any less. It appears, however, from the proceedings before the tribunal that the statement was produced on behalf of the union only at the time of the arguments and the petitioners had no opportunity of meeting this statement. The rojnama shows that the document was produced only on October 28, 1963 on the date of the argument. On the other hand on behalf of the petitioners' firm three agreements entered into by the employees of Kohinoor Dyeing and Printing Works, Maharaj Dyeing and Printing Works, both at Ghatkopar and Fashion Prints (Private), Ltd., a Bhandup, were sought to be produced. Apparently wage-structures of these concerns were much less than that of the petitioner-firm. In view of the fact that there is nothing to show how the tribunal came to the conclusion that the dearness allowance should be increased in the manner suggested by him, the award cannot be allowed to stand. We therefore set aside the award and remand the matter to the industrial tribunal for a further hearing and disposal on merits. It is agreed between both the parties that the parties will be entitled to lead all such evidence as they desire including the one challenging the balance sheet of the petitioner-firm.
8. There will be no orders as to costs.