Hindustan Steel Construction Ltd. vs Union of India and Others

Heard

The petitioners is Hindustan Steel Construction Ltd. Employees Union. They have challenged the proceedings of the Government of India, Ministry of Labour and Employment, dated 21-5-1996, in letter No.50/38/95-B2. By the impugned proceedings the application filed by the petitioners u/s 33-C(1) of the Industrial Disputes Act, 1947 (for short ''the Act'') is dismissed by the appropriate Government,

The learned Counsel for the petitioners strenuously submitted that the petitioners are entitled for the enhanced wages as per the revision of pay scales that have taken place right from the date of retrenchment to the dale the Supreme Court rendered the Judgment, in terms of Section 17B of the Act. The respondents had resisted this application of the petitioners on two grounds, (1)that there was no permanent sum on the basis of any award or settlement for the alleged recovery in terms of Section 33-C(1) of the Act; and (2) at any rate the petitioners have been paid the wages till the Judgment is rendered by the Supreme Court in terms of Section 17B of the Act, on the basis of the wages last drawn as on the date of retrenchment and as such they are not entitled for any sum in terms of Section 33-C(1), on the basis of enhancement or revision of pay scales that have taken place from the date of retrenchment to the date of Judgment of the Supreme Court. But the learned Counsel for the petitioners submitted that in terms of Section 17B of the Act when they are entitled to the last drawn wages that includes also the subsequent revisions effected to the pay scales and therefore the petitioners are entitled, for such wages and respondent No.1 is in error in dismissing that application. On the other hand the learned Counsel appearing for respondents 2 and 3 submitted that Section 17B itself states, that such wages payable, after the award of retrenchment passed by the Industrial Tribunal, during the pendency of the proceedings either before the High Court or the Supreme Court would be on the basis of the last drawn wages. Therefore, in terms of the said Section the wages are already paid to the workers of the petitioners'' Union till the disposal of the SLP by the Supreme Court. Therefore, the Management is not liable to pay any amount and the present application filed by the petitioners is misconceived. He also invited my attention to the Judgment of the Hon''ble Supreme Court reported in 1995 FLR 946 pertaining to the very petitioners and he also relied upon another Judgment of the Supreme Court reported in Dena Bank v. Kiritikumar T.Patel 1997(9) SC 428, contending that the Supreme Court had already interpreted Section 17B and held that the amounts that are payable in terms of Section 17B by the Management would be on the basis of the last drawn wages.

In order to appreciate the rival contentions I have to note few facts of the present case.

Respondents 2 and 3 is a construction Company. Regarding its unit at Hyderabad about 100 workmen were retrenched on the ground that the work undertaken by the Company at Hyderabad was completed. In those circumstances the workers of the petitioners'' Union preferred I.D.No.21 of 1982. The lndustrial Tribunal, Hyderabad, vide its Judgment and award dated 19-12-1983 directed reinstatement of the workers of the petitioners'' Union with consequential benefits. In those circumstances the Management preferred a writ petition in this Court in W.P.No. 6655/84. The learned Single Judge of this Court held that out of the 100 employees, retrenchment of 97 employees was correct and consequently the order of the Tribunal to that extent was set aside. Aggrieved by this Judgment and order of the learned single Judges, of this Court, two writ appeals were preferred before this Court in WANo.1528/84and 1529/84 and the Division Bench of this Court set aside the order of the learned Single Judge by restoring the order passed by the Tribunal. Being aggrieved by the Judgment and order of the Division Bench of this Court, the Management preferred Special Leave (Civil) Petition No. 10236-37 of 1985 before the Hon''ble Supreme Court. After granting the Special Leave the Hon''ble Supreme Court directed the Management to pay the D. A. and other allowances with effect from August,1985 within two months from 24-2-1996. It is submitted by the teamed Counsel for respondents 2 and 3 that amount was paid. Thereafter the Hon''ble Supreme Court also further directed in Civil Appeal Nos. 4079-80 of 1985, while disposing of CMP No. 17393-94 of 1988, that the Management shall pay to the workers the additional D. A. also within two months from 2-1 -1989. It is submitted by the Management that now that also was paid and the Management continued to pay the same till the disposal of the Civil Appeal by the Hon'' ble Supreme Court. These payments are admitted by the petitioners'' Union, but their contention is that those payments were made on the basis of the old pay scales instead of new pay scales. But the contention of the Management is that the workers of the petitioners Union are not entitled to the D.A etc., on the basis of the new pay scales introduced after the petitioners were retrenched on 28-3-1981,and the Hon''ble Supreme Court has already upheld their retrenchment and in those circumstances they contended that the workers of the petitioners Union were entitled to additional D. A. etc. if any, on the basis of the pay scales that existed as on the date of retrenchment and not any other allowance as per the revision of pay scales that have taken place after their retrenchment.

From the above narration of facts it is clear that there are few facts which are admitted. It is admitted that the petitioners/ workmen were retrenched w.e.f 28-3-1981 and that retrenchment order was set aside by the Industrial Tribunal directing reinstatement of the workers and the Division Bench of this Court by reversing the Judgment of the learned Single Judge upheld the order of the Industrial Tribunal. But, subsequently the Hon''ble Supreme Court set aside the award passed by the Industrial Tribunal confirming the order of retrenchment passed by the management. In view of these admitted facts now the short point for my consideration would be whether the petitioners would be entitled to the additional allowances etc. on the basis of the revised pay scales after the date of retrenchment in terms of Section 17B of the Act.

Section 17B of the Act provides that where an award directs reinstatement of any workman and the employer prefers any proceedings against such award in a High Court or the Supreme Court, the employer shall be liable to pay such workman, during the period of pendency of such proceedings in the High Court or in the Supreme Court, full wages last drawn by him, inclusive of any maintenance allowance admissible to him under any rule, if the workman had not been employed in any establishment, during such period, and an affidavit by such workman had been filed to that effect in such Court. From the reading of the above section it is clear that during the pendency of the proceedings before the High Court or the Supreme Court, the workman is entitled to full wages last drawn by him. The phrase ''last drawn'' would definitely indicate to the pay the workman was drawing as on the date of the retrenchment and it is not disputed that on the basis of that last drawn wages, as on the date of the retrenchment, the entire amount has been paid to the workers of the petitioners'' Union. But relying on Section 17B now the workers are contending that they are entitled to further additional allowances or other amounts as per the revised pay scales that have taken place w.e.f 28-3-1981 after their retrenchment. Here I may note that Section 17B is enacted so as to provide some sustenance allowance to the worker in case of any wrongful dismissal or termination, and the Management unrighteous prolongs the litigation by initiating proceedings either before the High Court or the Supreme Court. If the order of reinstatement as ordered by the Tribunal were to be upheld by the Apex Court the consequences would have been entirely different, since in case of wrongful dismissal or retrenchment the employee would be entitled to get all the amounts as if he has been in service and consequently the other benefits flowing thereto would definitely accrue to his benefit. But the consequences would be entirely different in case the order of retrenchment or dismissal or termination passed by the Management were confirmed by the highest Court. In such a situation his dismissal, termination or retrenchment would reach the finality and accordingly the legal consequences would be that he would not be deemed to be in service after the date of retrenchment, termination or dismissal. The intendment of Section 17B appears to be that the employer should reimburse the workmen in case if it fails to justify its order of termination, dismissal or retrenchment. Such a reimbursement by the management would not arise in terms of Section 17B of the Act, if the action of the management terminating, retrenching or dismissing of an employee stands confirmed by the highest Court. Even the proviso to Section 17B states that if the employee is employed elsewhere during the pendency of the proceedings, before the High Court or the Supreme Court, he would not be entitled to any remuneration during such period. In other words an employee shall not be denied remuneration wrongly if he is otherwise entitled to it but for the illegal action of the management. In these circumstances the only legal consequence, that follows from Section 17B is that, a person is entitled to wages during the pendency of the proceedings either before the High Court or the Supreme Court, in case the order of reinstatement ordered by the Tribunal is confirmed, on the basis of the revised wages, accorded after the date of retrenchment, termination or dismissal. But in case of an order of retrenchment, termination or dismissal assuming finality being confirmed by the highest Court he would not be entitled to any emoluments or remuneration in terms of the pay scales revised after such dates of termination, retrenchment or dismissal To the same effect also is the Judgment of the Hon''ble Supreme Court reported in Dena Bank''s case (1) (supra), the relevant part of the Judgment is extracted as below:

"As per the decisions of the High Courts referred to above the expression "full wages last drawn" in Section 17B can mean as under:

(1) Wages only at the rate last drawn and not at the same rate at which the wages are being paid to the workmen who are actually working. (Daladdi Cooperative Agriculture Service Society Ltd, v, Gurcharan Singh).

(2) Wages drawn on the date of termination of the services plus the yearly increment and the Deamess Allowance to be worked out till the date of the award (Vishveswaraya Iron and Steel Ltd. v. M. Chandrappa & Anr. and Kirtiben B.Amin v. Mafatlal Apparels).

(3) Full wages which the workman was entitled to draw in pursuance of the award and the implementation of which is suspended during the pendency of the proceedings (Carona Sahu Co.Ltd. v. A.K. Munakhan & Ors. Macneil and Magor Ltd. v. 1st Additional labour Court &Anr. and P. Channaiah v. Dy.Ex.Eng.)

The first construction gives to the words "full wages last drawn" their plain and material meaning. The second as well as the third constructions read something more than their plain and material meaning in those words. In substance these constructions read the words '''' full wages last drawn'''' as'' ''full wages which would have been drawn". Such an extended meaning to the words "full wages last drawn" does not find support in the language of Section 17B. Nor can this extended meaning be based on the object underlying the enactment of Section 17B.

As indicated earlier Section 17B has been enacted by Parliament with a view to give relief to a workman who has been ordered to be reinstated under the award of a Labour Court or the Industrial Tribunal during the pendency of proceedings in which the said award is under challenge before the High Court or the Supreme Court The object underlying the provision is to relieve to a certain extent the hardship that is caused to the workman due to delay in the implementation of the award. The payment which is required to be made by the employer to the workman is in the nature of subsistence allowance which would not be refundable or recoverable from the workman even if the award is set aside by the High Court or this Court. Since the payment is of such a character, Parliament thought it proper to limit it to the extent of the wages which were drawn by the workman when he was in service and when his services were terminated and therefore used the words "full wages last drawn". To read these words to mean wages which would have been drawn by the workman if he had continue in service if the order terminating his services had not passed since it has been set aside by the award of the Labour Court or Industrial Tribunal, would result in so enlarging the benefit as to comprehend the relief that has been granted under the award that is under challenge. Since the amount is not refundable or recoverable in the event of the award being set aside it would result in the employer being required to give effect to the award during the pendency of the proceedings challenging the award before the High Court or the Supreme Court without his being able to recover the said amount in the event of the award being set aside. We are unable to construe the provisions contained in Section 17B to cast such a burden on the employer. In our opinion, therefore, the words ``full wages last drawn" must be given their plain and material meaning and they cannot be given the extended meaning as given by the Karnataka High Court in Visveswaraya Iron & Steel Ltd. or the Bombay High Court in ''Carona Sahu Co. Ltd.

Shri Jitendra Sharma has laid emphasis on the word "full'''' in the expression "full wages last drawn" and has submitted that the said word'' implies that the wages last drawn must be the wages which the workman would have drawn under the award. We are unable to agree. In our opinion, the expression "full" only emphasizes that all the emoluments which are included in "wages" as defined in clause (rr) of Section 2 of the Act so as to include the amounts referred to in sub-clauses (i) to (iv) are required to be paid. In this context, it may also be mentioned that in Section 17B Parliament has also used the words "inclusive of any maintenance allowance admissible to him under any rules". These words indicate that maintenance allowance that is admissible under any rule is required to be paid irrespective of the amount which was actually being paid as maintenance allowance to the workman. But with regard to wages, Parliament has used the words "full wages last drawn" indicating that the wages that were actually paid and not the amount that would be payable are required to be paid."

In view of the above law declared by the Supreme Court, I hold that the petitioners are not entitled to wages on the basis of the revised pay scales effected after their retrenchment.

Before parting with the case I have to note that the present application in terms of Section 33-C(1) of the Act would not be prima facie maintainable. If the earlier award of reinstatement passed by the Industrial Tribunal were to stand perhaps such an application could have been maintained. In the instant case, the award of reinstatement passed by the Industrial Tribunal itself being set aside by the Hon''ble Supreme Court, confirming the order of management retrenching the petitioners, the present application u/s 33-C(1) of the Act is not maintainable.

For the above reasons the impugned order does not suffer from any illegality calling for interference at the hands of this Court under Articles 226 and 227 of the Constitution of India Accordingly I pass the order as under

The Writ Petition is dismissed, but in the circumstances without costs.