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1996 Supreme(SC) 1774
1997(6) Supreme 16
SUPREME COURT OF INDIA
J.S. Verma and B.N. Kirpal, JJ.
H.M.T. Ltd. etc. -Appellant
versus
H.M.T. Head Officer Employees Asso. & Ors. etc.-Respondents
Civil Appeal No. 1722 of 1990
(With C.A. Nos. 1723, 1724, 1725, 1726/90)
And
Civil Appeal No. 13380 of 1996
(Arising out of SLP (C) No. 5345 of 1990)
All Decided on 29-10-1996
Counsel for the Parties :
For the Appearing Parties : N.B. Shetye, (Hardev Singh) Sr. Advocate, (N.P.), Jitender Sharma, Sr. Advocates, Tripurari Ray, Vineet Kumar, Ms. Madhu Moolchandani, M.C. Narsimhan, Ms.Gunwant Dara, B.K. Pal, K.C. Gupta, Ms. Sheela Goel, Advocates.
Headnote:(i) Industrial Disputes Act, 1947-Section 10, 22-Illegal strike-Claim of wages-Whether workmen would be entitled to get any wages during the period of illegal strike ?-(No)-Declaration of lock out being in consequence of illegal strike-Lock out would not be deemed to be illegal even if provisions of Section 22 not complied with by managements-Workmen would not be entitled to any wages in respect of period of lock out-Syndicate Bank case, (1994) 5 SCC 572 : Relied on. (Paras 20 to 22)
Labour Law-Demands of unions of five Bangalore based public sector undertakings for parity in minimum wage with minimum wage payable to employees of BHEL after settlement of BHEL arrived at in June, 1980-Demand for a revision at the rate of Rs. 30/- p.m. w.e.f. 1.9.1978 - Settlement dated 9.6.1981 gave a lumpsum payment of Rs. 700/- to all employees-Claim raised by unions stood concluded by settlement of 1981-A sum of Rs. 25/- was given in addition to lump sum payment of Rs. 700/- -This Payment of Rs. 25/- is not adjustable-Direction of Tribunal not to allow demand of city compensatory allowance to workmen of I.T.I. was not correct-Award of Tribunal directing payment of 35 of wages during period of illegal strike and lock out modified.
Held : The settlement of 1978 was with regard to pay scales, allowance and other monetary benefits. The settlement of 9.6.1981 brought about a change whereby a sum of Rs. 25/- was given w.e.f. 1.1.1981 in addition to limp sum payment of Rs. 700/-. Clause (iv) of the settlement dated 9.6.1981 stated in no uncertain terms that all other conditions relating to pay allowances and other monetary benefits were to "continue for the extended period of the settlement" i.e. up to 31.12.1982. This would clearly show that the original settlement of 1978 with regard to pay-scales as well as allowances and other monetary benefits were to continue upto 31.12.1982 subject to the increase of Rs. 25/- p.m. plus lump sum payment of Rs. 700/-. This settlement of 9.6.1981 was arrived at during the conciliation proceedings and, therefore, was binding on the parties under Section 18(3) read with Section 19(2) of the Act. The term of settlement dated 9.6.1981 did not contemplate that the payment of Rs. 25/- p.m. w.e.f. 1.1.1981 was liable to the adjusted in any manner. It is no doubt true that the Tribunal by the impugned award was increased the minimum wage to Rs. 500/- p.m. because the Tribunal came to the conclusion that the settlement dated 9.6.1981 did not preclude the workmen from asking for a revision in the minimum wage consequent on the settlement having been arrived at in the case of BHEL. This conclusion of the Tribunal, in our opinion, was incorrect but as leave has not been granted to the management on this point, the decision of the Tribunal reviewing the minimum wage at the lowest rank of Rs. 500/- p.m. cannot be altered. However the payment of Rs. 25/- p.m. as contemplated by the settlement, is payable to all the workers in different scales of pay and the settlement does not contemplate the said amount being adjusted in any manner. (Para 28)
Further held that in the existing wage structure, city compensatory allowance was not being paid to the workmen of above-mentioned four companies because the local consumer price index used to be higher than the All India Consumer Price Index. In view of this difference in the price indices, C.C.A. was being paid to the employees of I.T.I. whose rise and fall in dearness allowance was controlled by the All India Consumer Price Index. The Tribunal while directing that city compensatory allowance will not be paid to the I.T.I. employees because it is not paid to the employees of other public sector undertakings at Bangalore, overlooked the fact that the local consumer price index was admittedly always higher than All India Consumer Prince Index. It is for this reason that the city compensatory allowance was being paid to the employees of I.T.I. Mr. Shetye frankly conceded that if city compensatory allowance is not paid to the employees of I.T.I. then over a period of time, the salary of workmen of I.T.I. would be less than the salary of the workmen of other companies because the variable dearness allowance of employees of B.E.L., B.E.M.L. and H.M.T. will increase at a higher rate than the variable dearness allowance of I.T.I. employees which is linked with the rise or fall in All India Consumer Price Index. In our opinion, therefore, the direction of the Tribunal dispensing with the payment of city compensatory allowance to I.T.I. employees was uncalled for. (Para 29)
JUDGMENT
Kirpal, J.-Leave granted.
2. The award of the National Industrial Tribunal, Bombay (hereinafter referred to as the Tribunal ) adjudicating on the demands of the unions of five Bangalore based public sector undertakings for parity in minimum wage with the minimum wage payable to the employees of another public sector undertaking namely; Bharat Heavy Electricals Limited (hereinafter referred to as BHEL ) is challenged by the managements as well as the workmen in these appeals.
3. The minimum wage of the lowest category of workmen of five Bangalore based public sector undertakings namely; Bharat Electronics Limited (hereinafter referred to as B.E.L. ), Bharat Earth Movers Limited (hereinafter referred to as B.E.M.L. ), Indian Telephone Industries Limited (hereinafter referred to as I.T.I. ) , Hindustan Aeronautics Limited (hereinafter referred to as H.A.L. ) and Hindustan Machine Tools Limited (hereinafter referred to as H.M.T. ) was the same in all these public sector undertakings. By settlements entered into various dates in 1974 between the managements and the workmen of these five undertakings except I.T.I., the minimum wage of the lowest category of workmen was fixed at Rs. 300/- consisting of basic pay of Rs. 200/- + Dearness Allowance of Rs. 100/- which was linked with Local Consumer Price Index. The minimum wage in I.T.I. was also fixed at Rs. 300/-. As dearness allowance was linked with All India Consumer Price Index, on the basis of the Index prevailing as on 1.12.1973, the Dearness Allowance payable on the basic wage of Rs. 200/- came to Rs. 91/- and, hence in order to bring uniformity in the minimum wage, the employees of the I.T.I. were paid City Compensatory Allowance (hereinafter referred to as C.C.A. ) of Rs. 9/- at 4 1/2 of the basic pay. The settlements in these five undertakings were to be in force till 31.12.1976.
4. In BHEL, with whom parity was being claimed by the workmen of these five industries, an agreement dated 17/18.9.73 had been entered into whereby the minimum wage was fixed at Rs. 258.70/- comprising of basic pay of Rs. 200/- as Dearness Allowance of Rs. 58/- at the All India Consumer Price Index of 200 points for industrial workers with 1960 base. A revision was effected by agreement dated 17/18.1.1974 and the minimum wage of the workers of BHEL was fixed at Rs. 300/-. This minimum wage, and the wage structure constructed on this basis, came into force with effect from 1.9.1973 and was to be in force for a period of four years. This agreement expired at the end of August 1977 and negotiations for the review and revision of the same w.e.f. 1.9.1977 were commenced between the management and the workers in March 1978. A final agreement between the management and the workers was reached on 8/9.1.1980. By this agreement, the wages as on 1.1.1978 for an unskilled employee in BHEL at the lowest level was fixed at Rs. 500/- per month at All India Consumer Price Index of 327 points. This agreement was to be effective from 1.1.1978 and was implemented in April, 1980.
5. The 1974 settlements between the managements of B.E.L., I.T.I., H.A.L., and B.E.M.L. expired on 31.12.1976 and hence the workmen unions submitted charters of demands in early part of 1977. Conciliation proceedings were held between the managements of five public sector undertakings and their workmen and amicable settlements were arrived at between the parties on 25.5.1978. Term number 1 of these settlements was uniform and is as follows :
"The Union agrees to accept the offer of the Management with regard to pay scales, quantum of Dearness Allowance and Fitment benefits and method of fixation of pay in the revised pay scales as detailed in Annexure-1. This, however, is without prejudice to the Union s right to take up the issues of revision of minimum wages and the enhancement of the rate of neutralisation of Dearness Allowance beyond Rs. 1.30 per point with the Government of India and if the Government of India agrees t
