Retrenchment compensation under S. 25F(b) of the Industrial Disputes Act, 1947, is 'wages' within the meaning of the Payment of Wages Act, 1936.

JUDGMENT :

BAVDEKAR, J.

1. This is an application under Articles 226 and 227 of the Constitution, which arises out of an application made by the district labour officer and inspector under the Payment of Wages Act to the authority under the Payment of Wages Act at Baroda in respect of compensation payable to 450 workmen and 20 clerks of opponent 2, Sri Dinesh Mills Ltd. whose services were terminated by the mill on the ground that the mill was being closed. It was the contention of the inspector that there was payable to the employees of the mill, under the provisions of Section 25F, Clause (b), of the Industrial Disputes Act, retrenchment compensation was "wages" within the meaning of that term as defined in the Payment of Wages Act. The mill has failed to pay this amount, and consequently there was either deduction of wages or delay in payment of wages, upon which he was entitled to make an application to the authority under the Payment of Wages Act u/s 15 of that Act.

2. The application was opposed on behalf of the mill, and the only contentions which it will be necessary to state for the purpose of this application are that the authority under the Payment of Wages Act had no jurisdiction to hear the application of the inspector, and in the second instance the representative union, acting on behalf of the workers, had made an application to the industrial court that the services of the employees were not properly terminated and the employees continued in service. An appeal from the unfavourable decision of the court had been filed to the Appellate Tribunal, and the employees could not, in the same breath, contend in one of that their retrenchment was illegal and they still continued in service and then ask from another court compensation for retrenchment, which must be upon the basis that the termination of the services of the employees was perfectly legal. The mill contended that the authority under the Payment of Wages Act had no jurisdiction to hear the dispute, because Section 25F, Clause (b), was ultra vires the Constitution, because awarding compensation restricts the right of the employer to carry on his business, which included the right to close his business, when he liked. They contended, in the second instance, that even if the Act was not void of the Constitution, there was no compensation payable to the employees, inasmuch as the closure of the mills was obligatory upon the mill, as it could not carry on the business of manufacture profitably and the employees could not be said to be retrenched. The mills said, in the third Instance, that assuming that compensation was payable to the employees u/s 25F, Clause (b), of the Industrial Disputes Act, it could not be said that it was "wages." "Wages" have been defined in the Payment of Wages Act to include, among other things, sums payable upon the termination of services. But this Court has taken the view in Sarin vs. Patil, 53 Bom. L.R. 674, that damages claimed by a workman upon the wrongful dismissal of his services did not amount to "wages" within the meaning of that term as defined by the Payment of Wages Act. Compensation payable upon the termination of services would not, therefore, fall within the part of the definition, which includes therein sums payable to any person by reason of the termination of his employment. "wages" has also been defined to mean remuneration which would, if the terms of the contract of employment, express or implied, were fulfilled, be payable whether conditionally upon the regular attendance, good work or conduct or other behaviour of the person employed or otherwise....

But compensation payable upon termination of service would not amount to remuneration, nor could the amount claimed by the employee be said to be payable. The mill contended finally that in any case the contentions which they raised included questions like Section 25P, Clause (b), being void as contravening Article 19(1)(g) of the Constitution, and the authority under