1. Dispute regarding pay computation and fitment of bank employees under an industrial award, initiated via applications under Section 33-C(2) of the Industrial Disputes Act. (Para 1 , 2 )
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1965 Supreme(SC) 340
SUPREME COURT OF INDIA
P.B. GAJENDRAGADKAR C.J.I., K.N. WANCHOO, M. HIDAYATULLAH, V. RAMASWAMI AND P. SATYANARAYANA RAJU, JJ.
State Bank of Patiala (in both appeals), Appellant
Versus
1.. Ram Parkash (In C. A. No. 1008 of 1965),
2. Tek Chand Sharma (In C. A. No. 1009 of 1965) Respondents.
Civil Appeals Nos.1008and 1009 of 1965.
Advocates appeared
Mr. C. K. Daphtary, Attorney General for India, Mr. S. V. Gupte, Solicitor General for India and Mr. Niren De, Additional Solicitor-General of India, (Mr. K. B. Mehta, Advocate, and M/s. V. Sagar H.L. Anand and B. C. Das Gupta, Advocates of M/s. Anand, Das Gupta and Sagar, with them), for Appellant (in both the appeals); Mr. M. K. Ramamurti, Advocate of M/s. Ramamurti and Co., for Respondents (in both the appeals).
Advocates:
Anand Das Gupta, B.C.DAS, C.K.DAFTARY, H.L.Anand, K.B.MEHTA, M.K.RAMAMURTHI, NIREN DEY, RAMAMURTHI, S.V.Gupta, V.SAGAR
Anand Das Gupta, B.C.DAS, C.K.DAFTARY, H.L.Anand, K.B.MEHTA, M.K.RAMAMURTHI, NIREN DEY, RAMAMURTHI, S.V.Gupta, V.SAGAR
Limits placed on 'adjusted basic pay' as of a specific reference date in an industrial award do not restrict subsequent annual increments provided for years following that date, as such increments are additive and pertain to a later period.
Headnote:(A) Industrial Disputes Act, 1947 - Section 33-C(2) - Interpretation of Industrial Award - Fitment of pay scales - Determination and computation of benefits under an industrial award - Where an award provides that basic pay as of a certain date shall not be reduced and that adjusted basic pay shall not exceed point-to-point adjustment or the maximum of the scale, such limits apply to the initial fixation and increments based on past service, but not to subsequent annual increments provided for years following that reference date. (Paras 8, 9)
(B) Interpretation of Awards - When a subsequent award provides directions similar to a previous award, subject to changes necessitated by the lapse of time, the substance of the previous award's interpretation by the court remains applicable. (Para 7)
Facts of the case:
The respondents filed applications for the determination and computation of benefits under an industrial award, contesting the fixation of their pay by the appellant-bank. The dispute centered on whether the maximum limit for adjusted basic pay specified in the award applied to subsequent annual increments provided for specific years following the reference date of January 1, 1959.
Findings of Court:
The court found that the limit on adjusted basic pay refers to the date of initial fitment. Increments provided for subsequent years are to be added over and above the adjusted basic pay arrived at for the reference date, as these increments pertain to a period beyond the scope of the limiting clause.
Issues: Whether the annual increments provided for the years 1960 and 1961 under the award are subject to the ceiling on adjusted basic pay as of January 1, 1959.
Ratio Decidendi: The court ruled that since the limiting clause applies to the adjusted basic pay as of the reference date, and the subsequent increments are for years following that date, these increments must be granted over and above the adjustments made for the reference date, regardless of whether the result exceeds the point-to-point adjustment limit of the reference date. (Paras 8, 9)
Result: Civil Appeal No. 1008 allowed; Civil Appeal No. 1009 dismissed.
Legal Category Hierarchy
Table of Contents
2. Whether the maximum basic pay limit established by point-to-point adjustment precludes the grant of subsequent annual increments provided for in the award. (Para 6 )
3. The award's provisions are substantially identical to a prior award; adjusted basic pay must be determined as of the specified service entry date. (Para 7 , 8 )
4. Annual increments for years following the date of basic pay adjustment are granted over and above the adjusted basic pay limit. (Para 9 )
5. One appeal allowed and another dismissed, resulting in the dismissal of one application and the upholding of another's pay fixation. (Para 12 )
6. How should the date for determining adjusted basic pay be interpreted when an award refers to a specific entry period?
The adjusted basic pay must be taken as of the date specified for the workman's entry into service, rather than the date the award was given, to ensure basic pay is not reduced. (Para 8 )
7. Does the limit on adjusted basic pay via point-to-point adjustment restrict subsequent annual increments?
While initial fitment and increments for the base period are subject to the point-to-point adjustment limit, annual increments for subsequent years are granted over and above that limit. (Para 8 , 9 )
8. Can a court apply the interpretation of one industrial award to another if the language is substantially the same?
Yes, if the substantive provisions are identical and verbal changes are merely due to the lapse of time, the same interpretation applies to both awards. (Para 7 , 9 )
Judgement
WANCHOO, J. : These two appeals by special leave raise a common question as to the interpretation of Para 5.356 of the National Industrial Tribunal (Bank Disputes) Award of June 1962 (popularly known as the Desai award) and will be dealt with together. It is unnecessary to set out the facts of the two appeals at this stage. It is sufficient to say that the respondents made applications under S. 33-C (2) of the Industrial Disputes Act, No. 14 of 1947 praying for determination and computation of the benefit to which they were entitled under the Desai award as they were not satisfied with the fixation of their pay by the appellant-bank under Para. 5.356.
2. The Desai award dealt with the method of adjustment in the scales of pay fixed by it from Para 5,329 onwards. It divided the employees of the banks with which it was concerned in two groups. The first group consisted of workmen who were drawing basic pay on January 1, 1962 according to scales of pay provided by the All-India Industrial Tribunal (Bank Disputes) Award, 1953 (popularly known as the Sastry award) as modified by the Labour Appellate Tribunal Decision (Bank Disputes). The second group consisted of workmen who on January 1, 1962 were employed in banks which were not governed by the provisions of the Sastry award as modified and were not thus drawing basic pay on the footing of scales of pay provided by that award. In the first case the Desai award provided that the workmen would be fitted in the new scales of pay from January 1, 1962 on stage to stage adjustment basis i.e. workmen who were drawing basic pay at a particular stage in the time scale of the Sastry award as modified would draw basic pay at the same stage in the new scale applicable to them under the Desai award. Examples of how this would be done were given in Para. 5,348 of the Desai award. As to the second group, the Desai award provided that these employees would first be fitted in the appropriate scales provided in the Sastry award as modified as on January 1, 1962 and thereafter they would be fitted in the new scales of pay provided by the Desai award as laid down in Para. 5,348. Paragraph 5,356 then went on to provide how these workmen would be fitted in the Sastry award. Here again the workmen were divided into two groups, namely, those who entered service before January 1, 1959 and those who entered service on or after January 1, 1959. In the present appeals we are concerned with workmen who entered service before January 1, 1959, and the fitment of these workmen was dealt with in Para, 5.356 of the Desai award, and it is this paragraph which calls for interpretation in the present appeals.
3. We may at this stage mention that a similar question of fitment was considered by the Sastry award in Para 292 and certain provisions were made thereunder. This paragraph was considered by the Labour Appellate Tribunal in appeal from the Sastry award and certain modifications were made thereunder by Paras. 164 and 166 of the Labour Appellate Tribunal decision in appeal. Paragraph 292 as modified by the Labour Appellate Tribunal decision came up for interpretation before this Court in State Bank of India v. Parkash Chand Mehra , 1961-2 Lab LJ 383 As the words of Para, 292 of the Sastry award as modified by the Labour Appellate Tribunal Decision are almost the same as the words of Para, 5.356 of the Desai award, we may set out the two paragraphs in parallel columns for comparison.
Sastri award as modified by the Labour Appellate Tribunal decision : Desai award. For workmen who entered service of the bank before 31st January, 1950 : For workmen who entered service of the bank before 1st January 1959 :
1. The workman s basic pay as on 31st January, 1950 shall not be reduced in any case. (i) The workman s basic pay as on January, 1959 shall not be reduced in any case.
2. Subject to rule (1) the adjusted basic pay in the new scale shall not exceed what point-to-point adjustment would give him or the maximum
