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Jaswant Sugar Mills Ltd. Vs. Authority Under the Payment of Wages Act and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtAllahabad High Court
Decided On
Case NumberCivil Misc. Writ No. 1921 of 1959
Judge
Reported inAIR1962All77
ActsPayment of Wages Act, 1936 - Sections 2, 15 and 17; Constitution of India - Article 226
AppellantJaswant Sugar Mills Ltd.
RespondentAuthority Under the Payment of Wages Act and ors.
Appellant AdvocateR.S. Pathak, Adv.
Respondent AdvocateS.N. Misra and ;H.N. Seth, Advs.
DispositionPetition allowed
Excerpt:
.....- allowance - sections 2(vi), 15 and 17 of payment of wages act, 1936 - retainer's allowance to seasonal workman in sugar factory - not wages - held, payment of allowance to workmen under section 15 beyond jurisdiction of authority also, order not passed in respect of wages, not appealable according to section17.  (ii) writ petition - article 226 of constitution of india - order for payment of wages to several workers - same interest - challenged - held, joint writ petition maintainable.  - cantonments act[c.a. no. 41/2006]. section 346 & cantonment fund (servants rules, 1937, rules 13, 14 & 15: [h.l. gokhale, ag. cj, p.v. hardas, naresh h. patil, r.m. borde & r.m. savant, jj] jurisdiction of school tribunal constituted under maharashtra employees of private schools..........'seasonal workman' also is to the effect that he is a person who is engaged only for the crushing season. crushing season does not cover the whole of the period of twelve months in any year. it, therefore, a seasonal workman is engaged for the crushing season only his engagement or rather employment as a workman comes to an end with the expiry of the crushing season; it runs out and there is no engagement which can be said to continue thereafter. he is re-remployed by reason of the standing order k. the employment which he gets in the current season is not the same employment under which he worked in the preceding season. no doubt, his employment in the preceding season entitles him on its strength to ask that he will be employed in the current season also but the fact that he has to be.....
Judgment:
ORDER

J.K. Tandon, J.

1. The above petition which is under Article 226 of the Constitution raises an important question of law as to the true meaning and scope of the term 'wages' defined in the Payment of Wages Act, 1936, and consequently as to the scope of Section 15 of the said Act under which the authority empowered therein can direct the payment of what has been claimed to be in this case delayed wages. It will be necessary at the very outset to state certain facts peculiar to the case.

2. The petitioner is a sugar undertaking owing its mills in the town of Meerut. The respondents, who are twenty-eight in number, besides the authority which made the order under Section 15 of the Act, are some of the seasonal labourers who happened to be employed in the petitioner's mills season after season during the last few years. The fact is not disputed that these respondents are seasonal workmen. The Standing Orders governing the conditions of employment of workmen in Vacuum Pan Sugar Factories in this State--the petitioner factory is One such factory--classify workmen in six different categories viz., (1) Permanent, (2) Seasonal, (3) Temporary, (4) Probationers, (5) Apprentices and (6) Substitutes. The seasonal workman is one who is engaged only for the crushing season but who is liable to be called on duty at any time in the off season and if he refuses to join or does not join he loses his lien as well as his retaining allowance. The expression 'season' is also defined in these Standing Orders and means 'the period commencing from the date when the crushing commences till the date when crushing ends.' It is not contested that the crushing season does not last during the whole of the length of the year.

3. During the period when the crushing season is not continuing the seasonal workmen who are engaged only for the crushing season are, since they are no longer engaged and are in off-season, paid retainer's allowance. The twenty-eight respondents claiming that they were entitled to this allowance for the off-period during the year 1957-58 moved the appropriate authority under Section 15 of the Payment of Wages Act for a direction that the employer be directed to pay the amount of the retainer's allowance which according to them was payable but had not been paid. The petitioners contested their liability on the ground, firstly, that no such allowance was payable and, finally, on the ground, with which this petition is presently concerned, that the payment claimed or asked for by the respondents was not included in the term 'wages' defined in the Payment of Wages Act, 1936, and, therefore, the authority hearing the applications by these persons was incompetent to act under the said Act. The petitioners' objection having failed before that authority they have come up by this petition impugning the order passed by it. The order is dated the 15th June, 1959, and has directed different amounts, as mentioned in col. 5 of the Schedule part of the above order, to be paid to the several persons.

4. The relief asked is a writ in the nature of certiorari quashing the said order and a direction also that it may not be given effect to. The grounds urged are, as previously noticed, that the retainer's allowance was not included within the term 'wages' defined in the Act and that that being so the authority acted without) jurisdiction in making the order under Section 15.

5. The relevant extract from the definition of the term, 'wages' contained in the Payment of Wages Act 1936 is thus:

''Wages' means 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, and includes-

(a) any remunoration payable under any award or settlement between the parties or order of a court;

(b) any remuneration to which the person employed is entitled in respect of overtime work or holidays or any leave period;

(c) any additional remuneration payable under the terms of employment (whether called a bonus or by any other name);

(d) any sum which by reason of the termination of employment of the person employed is payable under any law, contract or instrument which provides for the payment of such sum, whether with or without deductions but does not provide for the time within which the payment is to be made;

(e) any sum to which the person employed is entitled under any scheme framed under any law for the time being in force; but does not include-

(1) ....................

(2) ....................

(3) ....................

(4) ....................

(5) ....................

(6) ....................

It will be necessary to refer to the following provision also contained in the Standing Orders governing the conditions of employment of workmen in Vacuum Pan Factories. Standing Order K lays down that

'A seasonal workman who has worked or, but for illness or any other unavoidable cause, would have worked under a factory during the whole of the second half of the last preceding season will be employed by the factory in the current season.'

Referring to the above provision in the Standing Orders the petitioner has contended that a seasonal workman is freshly employed in the current season. There is no continuous employment in his case. The definition of 'seasonal workman' also is to the effect that he is a person who is engaged only for the crushing season. Crushing season does not cover the whole of the period of twelve months in any year. It, therefore, a seasonal workman is engaged for the crushing season only his engagement or rather employment as a workman comes to an end with the expiry of the crushing season; it runs out and there is no engagement which can be said to continue thereafter. He is re-remployed by reason of the Standing Order K. The employment which he gets in the current season is not the same employment under which he worked in the preceding season. No doubt, his employment in the preceding season entitles him on its strength to ask that he will be employed in the current season also but the fact that he has to be re-employed in the current season proves that his engagement in the current season is a fresh employment.

6. The learned counsel for the respondents would, however, contend that a seasonal workman when he is paid retainer's allowance is paid the same for the work done by him in the preceding season, as well as for his employment in that season, it is, therefore, not only remuneration given to him in respect off these periods but further that his employment does not cease at any time. During the off season when the retainer's allowance is being paid to him he is continuing in employment though on a reduced scale of wage.

7. This makes it necessary to judge the true nature of a retainer's allowance. It is payable to a workman who, being a seasonal workman, was engaged for the crushing season. It is paid to him during the off season, i.e. after the preceding crushing season is over and before the new season starts. During the off season the workman in receipt of the allowance is not working though he is under an obligation to be called on duty at any time during the season and similarly to be employed at the current season or rather the succeeding season. It is a payment to him for his liability to be so called or required to join employment at the next season. During the off season, when this allowance is paid to him, he is not actually employed; this is clear from the nature of his employment itself which is for the crushing season. The device of retainer's allowance is thus partly something to reduce the hardship which is inherent in seasonal appointments, and, partly also, to assure that the services of the person who is paid the allowance will be made available when the new season starts. The allowance thus paid to him is, since he is neither working for the employer during that period nor is employed under him, not a payment in respect of the one or the other. It is in the nature of an unemployment benefit for the promise that he shall join when so called upon or will take up employment at the succeeding season.

8. Since the eligibility for payment of retainer's allowance is related to employment during the later half of the preceding crushing season--Standing Order K contains this condition--the respondent's contention has also been that it is a payment for the work done in the past. Referring to the definition of the term 'wages' the learned counsel has further contended that all that is necessary under its provisions is that the remuneration is for work done and not necessarily for any work to be done during the off season, so that the work done during the preceding crushing season will be work done within the meaning of this definition. I have considered his contention carefully and to my mind the expression 'work done' found in the definition cannot be divested from its context, also the words 'in such employment' immediately following. The 'work done' will be work done if the employment is continuing but if the employment has ceased it will not be payment for 'work done' in such employment.

9. There is another difficulty also which the respondents cannot escape. In order that retainer's allowance may be wage it must be 'remuneration.' Any payment made to the past or present employee will not be wage unless it can be held to be 'remuneration,' whether expressed in terms of money or capable of being so expressed, payable to the person employed. Instances falling under Clauses (b) and (e) of the definition of 'wage' will clearly not include a case of retainer's allowance and for the purposes of the remaining portions of the definition its incidence as remuneration is essential. What is remuneration has accordingly to be judged.

10. The word 'remuneration' in the definition of 'Wage' given in the Payment of Wages Act, 1936 was recently considered by the Bombay High Court in Anusuya Vithal v. J. H. Mehta, AIR 1960 Bom 201. That was a case relating to the allowance payable for the period of lay-off. The learned Judges quoting from Stroud's Judicial Dictionary pointed out that the word 'remuneration' meant any consideration which a person received for giving his services. It was a payment made for services rendered. To quote from the judgment it was held:

'when no services are rendered and when in fact there is no obligation to render services, and when the amount becomes payable owing to the failure of the employer to provide work, it would be difficult to hold that it is remuneration.'

This was a case of lay-off but there is no fundamental difference between the case of lay-off and of 'off-season' so far as the particular point in issue here is concerned. In either case there is absence of any services rendered. There is similarly failure of the employer to provide work to the workman. The only difference is that in an industry which does not work for the whole year the failure to provide work during the off-season is inherent in the kind of the work itself. During the off-season the workman has no obligation to offer services. His liability to be recalled during this period cannot be treated as an obligation to render services which arises only after he has been recalled. The only obligation that he has is that if recalled he shall render service and that at the next season he will report himself for service.

11. In the case of Anusuya Vithal, AIR 1960 Bom 201 it was further held that compensation payable for lay-off was not 'remuneration' and was also not payable to a worker in respect of his employment or work done in such employment. If I may say so with profound respect I entirely agree with the reasoning in the above case which equally applies to the case of retainer's allowance.

12. The term 'remuneration' as was observed in the case of Bala Subrahmanya Raja Ram v. B. C. Patil, AIR 1958 SC 518 'is only a more formal version of payment and payment is a recompense for service rendered.'

The essential condition which must be present before the payment can be said to be remuneration, therefore, is that it is for services rendered. Where no service is rendered at the time nor is it a payment for the service to be rendered, the payment cannot be termed 'remuneration.'

13. The Bombay case was followed by the Madhya Pradesh High Court in Burhanpur Tapti Mills Ltd., Burhanpur v. Labour Officer, Government of Madhya Pradesh, AIR 1960 Madh Pra 370. This too was a case of lay-off and the question arose whether lay-off compensation was a wage within the meaning of the Payment of Wages Act, 1936. It was held that it was not so.

14. There is in my opinion no essential difference between a retainer's allowance and layoff compensation though they are payments arising under different circumstances. They are alike not payments for services rendered. They are, therefore, not remuneration within the meaning of the word used in the definition of 'wage'. On this finding, proceedings commenced under Section 15 of the Payment of Wages Act before the Authority under that Act were outside the competence of that Authority. Any order made by that Authority will also be an order without jurisdiction.

15. The learned counsel for the respondents raised two preliminary objections which I consider will be appropriate to answer. One of the objections by him was that the order sought to be impugned related to 28 workmen, there should, therefore, have been, 28 separate petitions and not a single petition as has been done. The next objection was that Section 17 of the Payment of Wages Act entitled the petitioner to go in appeal against the impugned order, admittedly no appeal was taken against it, hence, he has claimed that the writ should be refused on the ground of alternative remedy.

16. Either objection cannot be sustained. Indeed, there were 28 applications for award of wages before the appropriate authority but all these applications were heard together and disposed of by a single judgment. The proceedings may therefore, have commenced on 28 different applications but they were ultimately heard as a single case and disposed of by a single judgment. As a matter of fact, for the purpose of determining the right of appeal it is one consolidated amount which has been awarded by the authority which matters. Further the issue raised is identical in all and everyone of the applicants, i.e. the respondents, has the same interest in the order sought to be challenged. For the above reasons the relative preliminary objection cannot be allowed to prevail.

17. As regards the second objection the answer is plain. The petitioner has attacked the order on the ground that the authority which made it was incompetent to do so; his jurisdiction to make the order is itself challenged A certiorari will lie against an order which is held to be without jurisdiction; the presence of an alternative remedy where the initial competence is wanting is no answer. It further seems that the so-called alternative remedy itself cannot be of any avail here. The appeal provided by Section 17 of the Payment of Wages Act lies against an order in respect of wage made under Section 15. If the order sought to be impugned is an order not in respect of wage, it will cease to be a case under Section 15, and therefore, Section 17 also will be inapplicable. For the above reason too I am of the view that the preliminary objections cannot succeed.

18. In view of the above discussion thepetition should succeed. The order dated the 15thJune, 1959, made under Section 15(3) of the Payment of Wages Act, 1936 (Annexure B) is quashed. No order is made as to costs.


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