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2007 Supreme(SC) 470
SUPREME COURT OF INDIA
S.B. Sinha & Markandey Katju
M/s. Hamdard (Wakf) LaboratoriesPETITIONER
versus
Deputy Labour Commr. & OrsRESPONDENT
Appeal (civil) 2204 of 2007
Decided on 7/04/2007
Statutory definitions of 'wages' in industrial laws explicitly exclude 'bonus'. Therefore, terms used in a judicial award must be interpreted in conformity with these statutes, and a right to bonus cannot be enforced via execution proceedings unless explicitly granted in the award.
Headnote:(A) State Industrial Disputes Act - Section 2(y) and Section 6-H(1) - Payment of Bonus Act - Section 2(21) - Payment of Wages Act, 1936 - Section 2(vi) - Industrial Disputes Act, 1947 - Section 2(rr) and Section 33C(1) - Interpretation of "wages" in a judicial award - Whether the term "wages and allowances" includes "bonus" - Statutory definition of "wages" explicitly excludes bonus - A judicial award must be construed in conformity with statutory provisions - Terms used by a judicial officer in an award must be given the same meaning as provided in the statute. (Paras 24, 26, 27)
(B) Scope of execution proceedings - Proceedings under Section 6-H(1) of the State Industrial Disputes Act are in the nature of execution proceedings for the enforcement of a right - Such authority cannot determine complicated questions of law or disputes regarding the existence of a legal right - These proceedings cannot usurp the jurisdiction of the government to construe an award. (Paras 21, 22)
(C) Bonus - Not to be treated as "deferred wages" in the context of back-wages calculations unless explicitly stated in the award - A claim for bonus must be raised as an industrial dispute rather than through an execution application. (Paras 32, 52)
Facts of the case:
An employer terminated the services of several workmen. A Labour Court award subsequently directed the reinstatement of the workmen and the payment of 50% of back-wages and allowances. The workmen filed an application under the execution provisions of the State Industrial Disputes Act claiming bonus, arguing that bonus is a deferred wage and should be included in "wages and allowances". The Labour Commissioner and the High Court upheld the claim, ruling that the phrase "wages and allowances" in the award included bonus.
Findings of Court:
The term "wages" as defined in the State Industrial Disputes Act, the Industrial Disputes Act, and the Payment of Bonus Act specifically excludes bonus. Since the Labour Court award directed payment of "wages and allowances", it must be interpreted according to the statute. The Labour Commissioner and High Court erred in treating bonus as "deferred wages" and in using execution proceedings to determine a disputed legal right to bonus.
Issues: Whether "bonus" falls within the definition of "wages and allowances" for the purpose of executing a Labour Court award, and whether such a claim can be maintained via an execution application under Section 6-H(1) of the State Industrial Disputes Act.
Ratio Decidendi: A judgment or award must be construed in a manner that does not offend statutory provisions. Since "bonus" is explicitly excluded from the statutory definition of "wages" under the relevant Acts, it cannot be included in an award mentioning "wages and allowances" by implication. Furthermore, execution applications (analogous to Section 33C(1) of the Industrial Disputes Act) are for the enforcement of existing rights and cannot be used to adjudicate disputes over the existence of a legal right.
Result: Appeal allowed.
CIVIL APPEAL NO. 2204 OF 2007 [Arising out of SLP (Civil) No. 17526 of 2006]
S.B. SINHA, J :
Leave granted.
Relationship between the parties hereto is employer and workmen. As far back in the ear 1983, the appellant terminated the services of 37 workmen allegedly on the ground that they had gone on an illegal strike. It gave rise to an industrial dispute. The management and its 19 workmen entered into compromise. One workman died during pendency of the said dispute. Claim of 17 workmen, therefore, survived for adjudication in the aforementioned industrial dispute. By an award dated 26.05.1993, the industrial court, to which reference of the dispute was made by the appropriate government, directed:
"Accordingly, the Employers are directed to reinstate these 17 workers on duty on the original post and payscale within one month after the date of publication of this Award. So far as the question of back-wages is concerned, these workmen are to be paid 50% of their wages/ allowances which they were getting on 2-6-83, for the period 1-8-87 till the date of their joining the duty, within 2 months of publication of this Award. As regards the deceased Komal Singh, his Provident Fund, Insurance money and wages/ allowances upto 30-9-91 to be calculated in the same manner as was paid on 2-6-83 and 50% of the same is to be paid by the Employer to his wife Smt. Shakuntala. This is my Award in this dispute."
The said award ultimately attained finality as the writ petition preferred thereagainst by the appellant was dismissed by an order dated 3.11.1995. A Special Leave Petition filed thereagainst has also been dismissed.
On or about 2.08.1994, an application purported to be under Section 6-H(1) of the U.P. Industrial Disputes Act, 1947 (for short "the Act") claiming backwages and bonus was filed wherein the total amount of claim was for a sum of Rs. 20,70,020.44.
The Additional Labour Commissioner, however, on an objection raised by the appellant to the effect that the amount of bonus could not be included in the claim application issued a recovery certificate for a sum of Rs. 17,61,755.18. A review application, however, was filed inter alia on the premise that the workmen were not entitled to claim any bonus. By an order dated 9.11.1994, the said plea on the part of the appellant was accepted as a result whereof the claim was reduced to Rs. 5,31,030.90. The said direction
admittedly has been complied with.
The workmen, however, filed another application before the Labour Commissioner, Ghaziabad claiming bonus for the period 1987 to 1996. In its objection filed thereto, the appellant contended:
"It is respectfully submitted that the present claim of Bonus for the period 1987 to 1996 have been filed on the last date of hearing on 04.7.96. The workmen have earlier also filed a claim u/s 6-H(1) vide their application dtd. 02.8.94 and also submitted list claiming Bonus, yearly increments, leave with wages, etc. The predecessor of the office Sh. Arjun Ram the then Addl. Labour Commissioner heard the parties at length and passed an order dtd. 26.9.94 amounting to Rs. 17,61,755.18. The employers/ management filed an application to review the said order on 15.10.94. The review application was heard in presence of the parties and the earlier order dtd. 26.9.94, was reviewed, order modified to the extent of Rs. 5,31,030.00. The then Addl. Labour Commissioner rejected the claim of Bonus, yearly increments etc. since the claim of Bonus yearly increments etc. have already been rejected by a competent authority the same cant be heard again.
That the claim of Bonus does not fall in the definition of wages as defined in Section 2(y) of the U.P. I.D. Act, 1947 hence the said claim cannot be maintainable U/s 6-H(1) of the U.P. I.D. Act, 1947 and deserves to be dismissed outrightly.
That the Honble Labour Court (I), Ghaziabad who passed the Award in Adj. Case No. 275/87 have not given any consequential relief. Hence the work
