JUDGMENT

KHALID, J. :— This appeal, by special leave, is directed against the award of the Industrial Tribunal in IT No. 531 of 1975, dated 27th October, 1980. The appellants are the monthly-rated workmen at Wadala Factory of the Indian Hume Pipe Company Ltd., Bombay and the respondent the Company mentioned above.

We will briefly refer to the history of the demands of the workmen in this Company to appreciate how the dispute involved in this appeal originated. The respondent (hereinafter referred to as the Company) is an Engineering concern owning sixty factories spread throughout India. In Bombay, it has a factory at Wadala and head office at Bellard Estate. In this appeal, we are concerned with the monthly rated workmen at the Wadala Factory. In this factory there are about 375 daily rated workers and 80 monthly rated clerical and subordinate staff. The total labour strength all over India is about 3000 daily rated workers and 1000 monthly rated clerical and subordinate staff.

In the year 1950, there was an industrial dispute pertaining to the pay scales and dearness allowance of the workmen in this factory. An award was passed in this dispute by the concerned Industrial Tribunal in reference No. IT 82 of 1950. By this award pay. scales and fixed dearness allowance were introduced w.e.f. 1-7-1950, with the consumer price index in Bombay at 312 points in 1950. In 1957, the index rose by 55 points and stood at 367 points. There was another industrial dispute in 1958 in reference IT No. 77 of 1958 resulting in the award published on the 21st May, 1959, introducing the slab system of D.A. w.e.f 1-2-1958. This award was not challenged by the Company at any time.

In 1964, the labour sought revision in the pay scales for the monthly rated clerical and subordinate staff, as a consequence, of which reference IT No. 47 of 1964 was made resulting in an award published on 30-12-1965, which provided marginal increase in the basic pay scales, mainly on the ground that the slab system was working satisfactorily.

2. In this Company the daily rated operatives were getting the old textile scale since the year 1942 which was raised to the revised textile scale as D.A. by an award. Thus, the daily rated operatives and the monthly rated clerical and subordinate staff were paid D.A. on different basis and at different rates in this Company. As there was no revision in the pay scales from 1950, for about 22 years a demand was made for revision in pay scales for monthly rated clerical and subordinate staff in the year 1972. This demand was referred to adjudication in reference IT No. 42 of 1973 as a consequence of which an award was published on 7-7-1977. The clerical and subordinate staff in the head office of this Company were also being given the slab system of D.A. This award observed that there should not be any disparity in the D.A. between the monthly rated factory staff and the head office staff.

3. While the wage structure stood thus, the Company gave notice of change for doing away with slab system of D.A. by notice dated 15-7-1975, in respect of the head office staff and the monthly rated factory staff. The notice of change in respect of the head office staff was not pressed since a settlement was reached between the parties. As per this settlement arrived at in July 1976, the D.A. at consumer price index 1380 points was merged in the revised consolidated pay scale of different categories w.e.f. 1-9-1975. Although in September, 1975, the consumer price index figure was 1270 points, it was taken notionally as 1380 for the purpose of merger, indicated above providing for review of consolidated pay scales if the consumer price index moved high. The notice of change in respect of monthly rated factory staff was, however, referred to adjudication. The. Companys claim was to do away with the slab system of D.A. and to substitute it by revised textile scale. The Union filed a written statement justifying continuity of the slab system which was in vo