1. Industrial dispute regarding reinstatement and back wages — recovery of awarded sums under Section 6-H of the U.P. Industrial Disputes Act, 1947. (Para 2 )
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1964 Supreme(SC) 320
SUPREME COURT OF INDIA
26th November 1964
P.B. GAJENDRAGADKAR, C.J.I., M. HIDAYATULLAH, J.C. SHAH, S.M. SIKRI AND R.S. BACHAWAT, JJ.
Kays Construction Co. (Private) Ltd., Appellant (In both the Appeals)
Versus
The State of U.P. and others, Respondent (In both the Appeals).
Civil Appeals Nos. 1108 and 1109 of 1963
Advocates appeared
Sir Iqbal Ahmed, Senior Advocate, (M/s. K. Rajendra Chaudhuri and K. R. Chaudhuri, Advocates, with him), for appellant (In both the Appeals); Mr. C. B. Aggarwala, Senior Advocate, (Mr. O. P. Rana, Advocate, with him), for Respondents Nos. 1 to 4 (In both the Appeals).
Advocates:
C.B.AGARWAL, IQBAL AHMED, K.R.CHAUDHARY, K.RAJENDRA CHAUDHARY, O.P.RANA
C.B.AGARWAL, IQBAL AHMED, K.R.CHAUDHARY, K.RAJENDRA CHAUDHARY, O.P.RANA
Back wages awarded under an industrial dispute are "money due" under the first sub-section of the Industrial Disputes Act and not a "benefit computable in terms of money" under the second sub-section, as simple arithmetical calculations do not require the elaborate computation procedure of the latter.
Headnote:(A) Industrial Disputes Act - Section 6-H(1) and (2) - Recovery of money due under award - Distinction between "money due" and "benefit computable in terms of money" - Back wages awarded by a Tribunal are considered "money due" under the first sub-section - Mere arithmetical calculation of the amount of back wages does not bring the case within the scope of the second sub-section, which deals with benefits like free quarters or electricity that require computation into monetary terms before recovery. (Paras 6, 7)
Facts of the case:
An industrial tribunal ordered the reinstatement of workmen and the payment of 50 per cent of their back wages. The workmen sought recovery of these wages through certificates issued by the government. The employer objected, contending that the exact amount had not been determined and therefore the matter should be referred to a Labour Court for computation of the benefit. The single judge of the High Court agreed with the employer, but the Division Bench reversed the decision, holding that back wages are money due.
Findings of Court:
The court found that the recovery of back wages falls under the first sub-section of the relevant section as "money due" and not under the second sub-section as a "benefit" requiring computation.
Issues: Whether the claim for back wages is to be considered as "money due" under the first sub-section or as a "benefit which is capable of being computed in terms of money" under the second sub-section of the Industrial Disputes Act.
Ratio Decidendi: The court held that there is a clear distinction between "money due" and a "benefit" that can be reckoned in terms of money. While benefits like free quarters require an inquiry to determine their monetary value, back wages are inherently monetary. Simple arithmetical calculations to verify the amount due do not necessitate the elaborate procedure of the second sub-section. Verification of the claim is a prerequisite for the government's satisfaction under the first sub-section.
Result: Appeals dismissed.
Legal Category Hierarchy
Table of Contents
2. Whether recovery of back wages requiring arithmetical calculation falls under Section 6-H(1) as money due or Section 6-H(2) as a benefit computable in money. (Para 4 , 6 )
3. Distinction between money due and benefits computable in money; arithmetical calculation of wages does not transform money due into a benefit requiring elaborate computation procedures. (Para 6 , 7 )
4. Back wages for unemployment are money due under Section 6-H(1), not a benefit computable in money under Section 6-H(2), despite requiring arithmetical calculation. (Para 7 )
5. Appeals dismissed; judgment of the Division Bench upheld. (Para 7 )
6. What is the distinction between money due under Section 6-H(1) and a benefit computable in terms of money under Section 6-H(2) of the U.P. Industrial Disputes Act?
Money due refers to sums already owed, whereas a benefit is an advantage or perquisite, such as free quarters, which is not money until its value is reckoned through inquiry and equation. (Para 7 )
7. Does the need for arithmetical calculation of back wages necessitate proceedings under Section 6-H(2) for the determination of a benefit?
No. Mere arithmetical calculation of back wages does not fit the definition of a benefit computable in money; such claims are covered by Section 6-H(1) as money due. (Para 7 )
8. Is the verification of the amount claimed by workmen a determination of a benefit under Section 6-H(2)?
No. Verification of the claim is an inquiry to satisfy the State Government that the amount is actually due under Section 6-H(1), not a determination of a benefit's value. (Para 7 )
Judgment
HIDAYATULLAH, J. : These are two appeals by special leave in which Kays Construction Co. (P) Ltd. is the appellant. Civil Appeal No. 1108 of 1963 is against a judgment of the Allahabad High Court dated March 15, 1962 and Civil Appeal No. 1109 of 1963 is against an order of the same High Court dated May, 9, 1962 declining to certify the case under Art. 133 of the Constitution as in the opinion of the High Court the proceeding from which the appeal arose before the High Court was not a civil proceeding within Art. 133. As special leave has been granted against the judgment of the High Court and we are of opinion that the appeal against that judgment must be dismissed, we do not think it necessary to decide the other appeal.
2. The facts of the case may now be stated briefly. The appellant Company is the successor of a private concern which went under the name of Kays Construction Company and was owned by one Mr. H. M. Khosla who is now Managing Director of the appellant Company. It appears that Mr. Khosla found it unprofitable to continue the business as his own and he stopped it for a while before Kays Construction Co. (Private) Ltd. came into existence. The appellant Company took over the business and with it, some of the workmen of the former concern but not all. This led to an Industrial dispute before the Allahabad Industrial Tribunal (Sugar) and an award was made on January 31, 1958. One of the question in dispute before the Tribunal was the reinstatement and back wages of the workmen who were not reemployed by the appellant Company. The Tribunal delivered an award. The parties to this appeal have not cared to produce the award but an extract from it relevant to this part of the controversy is on the record and it runs as follows :
"As a result of my finding above, I hold that management of Messrs Kays Construction Co. (Private) Limited, Allahabad, are required to reinstate the old workmen given in the Annexure of Messrs Kays Construction Co., Allahabad. They will be restored in their old or equivalent jobs and given continuity of service. In view of the somewhat peculiar features of this case and in the larger interest of the Industry, I would, however, order that the workmen be paid only 50 per cent, of their back wages for the period they were forcibly kept out of employment."
After this award a large number of the workmen preferred claims for their back wages purporting to do so under the first sub-section of S. 6-H of the U. P. Industrial Disputes Act, 1947. That section, shorn of provisions which do not concern us, reads as follows :
"6-H (1) Where any money is due to the workmen from an employer under the provisions of Ss. 6-H to 6-R under a settlement or award, or under an award given by an adjudicator or the State Industrial Tribunal appointed or constituted under this Act, before the commencement of the Uttar Pradesh Industrial Disputes (Amendment and Miscellaneous Provisions) Act, 1956, the workman may, without prejudice to any other mode of recovery, make an application to the State Government for the recovery of the money due to him, and if the State Government is satisfied that any money is so due, it shall issue a certificate for the amount to the collector who shall proceed to recover the same as if it were an arrear of land revenue.
(2) Where any workman is entitled to receive from the employer any benefit which is capable of being computed in terms of money, the amount at which such benefit should be computed may subject to any rule that may be made under this Act be determined by such Labour Court as may be specified in this behalf by the State Government, and the amount so determined may be recovered as provided for in sub-section (1).
(3) * * * * *"
The appellant Company made a large number of objections to this demand before the Labour Commissioner, U. P., to whom the powers of the State Government under the first sub-section of S. 6-H had been delegated. These objections, shortly stated, were that s
