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SUPREME COURT OF INDIA
M. HIDAYATULLAH, S.M. SIKRI AND C.A. VAIDIALINGAM, JJ.
The Kamani Metals and Alloys Ltd., Appellant
Versus
The Workmen, Respondents.
Civil Appeal No. 634 of 1965,
D/- 24- 1 - 1 1967.
Advocates appeared
Mr. H. R. Gokhale, Senior Advocate (Mr. I. N. Shroff, Advocate with him), for Appellant; M/s. K. K. Singhvi and R. S. Kulkarni, Advocates and M/s. S. C. Agarwala and D P. Singh, Advocates of M/s. Ramamurthi and Co. for Respondents.
INDUSTRIAL DISPUTE - WAGE REVISION - PRINCIPLES - INDUSTRY-CUM-REGION FORMULA - ADJUSTMENT OF WAGES - RETROSPECTIVE OPERATION - DEARNESS ALLOWANCE - CALCULATION - RELEVANCE OF INCENTIVE BONUS.
Fact of the Case:
The appellant company, Kamani Metals and Alloys Ltd., challenged the award of the Maharashtra Industrial Tribunal, Bombay, which revised the wage scales, dearness allowance, and other benefits for its employees. The revision was based on a reference made by the Bombay Government under Section 10(1)(d) of the Industrial Disputes Act, 1947, following a demand raised by the Kamani Employees Union Bombay.
Finding of the Court:
The Supreme Court upheld the award, finding that the Tribunal had followed the correct principles in revising the wages and dearness allowance. The Court held that the Tribunal had properly considered the industry-cum-region formula, taking into account the wages and conditions in comparable industries and regions. The Court also found that the Tribunal had not erred in adjusting the wages of existing employees based on their length of service, as this was a fair way to address the concerns of both the employees and the employer. Additionally, the Court held that the Tribunal was justified in making the award retrospective from October 1, 1962, considering the circumstances of the case.
Issues: 1. Whether the Tribunal erred in revising the wages and dearness allowance without considering relevant factors and principles. 2. Whether the Tribunal erred in comparing the appellant company with dissimilar concerns and not considering comparable units. 3. Whether the Tribunal erred in taking into account the yield from incentive bonus in fixing the wages. 4. Whether the Tribunal erred in adjusting the wages of existing employees based on their length of service. 5. Whether the Tribunal erred in making the award retrospective from October 1, 1962.
Ratio Decidendi: 1. The Tribunal considered all relevant factors and principles in revising the wages and dearness allowance, including the industry-cum-region formula, comparable industries and regions, and the financial capacity of the appellant company. 2. The Tribunal did not err in comparing the appellant company with the Kamani Engineering Corporation, as there was an affinity between the two companies and the comparison was relevant to the industry-cum-region formula. 3. The Tribunal did not rely solely on the yield from incentive bonus in fixing the wages, but considered it as one factor among many in determining the appropriate wage scales. 4. The Tribunal did not err in adjusting the wages of existing employees based on their length of service, as this was a fair and reasonable way to address the concerns of both the employees and the employer. 5. The Tribunal was justified in making the award retrospective from October 1, 1962, considering the circumstances of the case, including the delay in conciliation and the frustration of the conciliation process.
Final Decision: The appeal was dismissed, and the award of the Tribunal was upheld.
Judgement
HIDAYATULLAH, J. : This is an appeal against the Award, April 23, 1964, of the Maharashtra Industrial Tribunal, Bombay (Mr. Meher) in reference (IT) 271 of 1962. The Award was given in a dispute between the Kamani Employees Union Bombay and the Kamani Metals and Alloys Ltd. The Company is the appellant before us. The reference was occasioned by a demand raised by the Union on February 25, 1960 in relation to wage scales and classifications, dearness allowance, production bonus, permanency for daily-rated workmen and grades and scales of pay, dearness allowance and abolition of marriage-clause for monthly paid employees. At first a reference was made to a Conciliation Board by the Government on September 8, 1962. The conciliation was frustrated for some reasons and on December 14, 1962, the Bombay Government acting under S. 10 (1) (d) of the Industrial Disputes Act, 1947 referred the dispute to the Tribunal for adjudication. By the Award now under appeal, some points were decided in favour of the Company and some others in favour of the workmen. The workmen have not appealed and the Company has also confined this appeal to some of the points decided against it.
2. We are concerned with a Company which is carrying on the business of melting and manufacturing all kinds of rolled products of non-ferrous metals and alloys, copper and copper-based alloys such as sheets, strips, coils etc. According to the Company the process of manufacture unlike the general engineering industry, involves only the melting of the non-ferrous metals and casting them into suitable slabs for the subsequent processes of hot and cold rolling to alter their shape, size and metallurgical properties. The product so wrought serves as a base raw material for making products such as automobiles, telephones, radios and other electrical gadgets, etc. The Company claims that it cannot be described as a general engineering industry.
3. The main contentions in this appeal concern the revision of wages and monthly pays and the fixing of wage scales and time scales in respect thereof, respectively, and the increase in dearness allowance by adopting a new system of calculation. The Company also complains that: the Award has been given retrospective operation entailing heavy burden upon it. In support of the above contentions the Company states that its financial capacity does not bear the revision either of the wages and pays on the one hand or the dearness allowance on the other. It submits that the Tribunal in revising the wages, pays and the dearness allowance has followed wrong principles and ignored those laid down by this Court. Much of the argument in respect of wages to daily rated workmen and pays to monthly-rated workmen is common and it will not be necessary to refer to the argument twice over in the course of this judgment.
4. This is the first revision of wages and the dearness allowance in this Company during the last 20 years. The wage-scales and the dearness allowance were fixed unilaterally to start with. The minimum basic wage was fixed at Rs. 30 per month or Rs. 1.16 per day which was the minimum settled by the Bombay Textile Standardization Award and the First Central Pay Commission for Government servants in or about 1950. The Tribunal has raised the minimum wage to Rs. 1.35 per day, which is equivalent to a wage of Rs. 35 per month. The maxima have also been raised proportionately. Similarly, in the case of monthly-rated workmen the minimum monthly salary, which was Rs. 60 for the lowest grade clerk, has been raised to Rs. 85 and the maximum has been increased in almost the same proportion. The Company contends that this increase is based upon wrong principles inasmuch as the wages and pays in this Company have been compared not only with the companies operating non-ferrous metals in the same way but with general engineering concerns and has taken an irrelevant factor, namely, the yield from incentive bonus into consideration has made wrong
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