Ram Niwas and Others vs Jind Co-operative Sugar Mills Ltd. and Others

T.H.B. Chalapathi, J.—This writ petition is filed to quash the order of the Appellate Authority under the Payment of Wages Act dated January 13. 1993.

All the petitioners are working as Cane Clerks in Jind Co-operative Sugar Mills Limited, Jind. They are deputed to various purchasing Centres during the crushing season 1986-87. Their main function was to weigh the sugar cane brought to the Sugarcane Centres and thereafter transport the same to the mill. According to the management of the mill there was loss and shortage in the sugarcane which was transported to the mill. The management of the Sugar Mill thereafter started deduction of the amount of loss sustained by the mill due to the shortage of sugarcane due to the difference weighed at the Sugarcane Centre and the mill. It appears that show-cause notice has been given to the petitioners calling for their explanation in the month of October, 1987. Some of the petitioners submitted their replies in November, 1987, but the management started deduction from the wages of the petitioners-employees from the salary from the month ot October, 1987. Challenging the deduction made by the management, the petitioners approached the Authority under the Payment of Wages Act. The Authority under the Payment of Wages Act allowed the application of the employees and directed the management to pay the employees the amount deducted from their wages u/s 15(3) of the Payment of Wages Act. Against the said order, an appeal had been preferred by the management to the Additional District Judge, Jind. who is the Appellate Authority under the Payment of Wages Act, 1936. The Appellate Authority by the impugned order held that the deductions made are legal and the employees are not entitled to any refund of the amount deducted.

Challenging the said order of the Appellate. Authority the employees petitioners filed this writ petition. There cannot be any dispute that when there is a loss to the management, the management is entitled to make deductions from the wages of the employees as provided in Clause (c) of subsection 2 of Section 7 of the Payment of Wages Act. But before making any such deduction, an opportunity of showing against the deductions should be given to the employees concerned for making such deduction as provided under Subsection 6(1-A) of Section 10 of the Act. Admittedly the management started deducting the amount from the wages of the employees even before issuing a show-cause notice as required under Subsection (1a) of Section 10 of the Act. Therefore, there is a clear non-compliance of the provisions of the Payment of Wages Act. It also does not appear that any specific order has been passed for making deductions from the wages of the employees after considering their explanations to the show-cause notice. Admittedly, the employees have submitted their explanations in the month of November, 1987, while the deductions started from the month of October, 1987. Therefore, the management is not right in making the deductions from the wages of the employees for the alleged loss sustained by the mill due to the shortage of sugar-cane supplied to the mill after weighing at the Purchasing Centre without considering the explanation given by the petitioner for the shortage in weighment. On this ground alone the order of the Appellate Authority is liable to be set aside. But however the fact remains that there is some shortage in the Sugarcane when it was weighed at the mill. Whether the shortage was due to the fault of the employees, i.e. sugarcane clerks or whether this loss of shortage occurred during transport of the sugarcane from the weighing centre to the mill has not been determined. It is also pertinent to note that there can be shortage in weighing due to efflux of time in transporting the sugarcane from the Purchasing Centre to the mill. This aspect of the matter was also not considered by the Management. The management, is.therefore, under an obligation under Sub-section (1-A) of Section 10 to pass an order after considering the explanation submitted by the Sugar cane clerks and determining the loss, if any, sustained by the management due to the shortage of sugar cane supplied at the mill from the purchasing centre. This necessitates an enquiry to be made by the management. Without determining the actual loss after considering whether the shortage was due to the fault of the employees (sugar cane clerks) or due to the loss in transit or loss in weighing or delay in transporting the sugar cane, the management cannot effect the recovery from the wages of the employees under Clause (c) of sub-section 2 of Section 7.

I, therefore, set aside the order of the Additional District Judge-cum-Appellate Authority under the Payment of Wages Act and direct the management to consider the explanations submitted by the employees (sugarcane clerks)namely the petitioners herein and pass a speaking order after considering all the points raised by the petitioners herein and pass a speaking order after considering all the points raised by the petitioners n their explanations within three months from today. If no order is passed within the said period of three months the management shall refund the amount deducted from the wages of the employees sugar cane clerks) with interest at the rate of 12 percent from the date of deduction till payment. It is made further clear that if no order is passed within the aforesaid period of three months, the orders of the Authority under the Payment of Wages Act will stand remain and no further action shall be taken by the management for the deduction of the loss from wages. The petitioners are also permitted to inspect the record and adduce such evidence as they deem fit before the management which is hereby directed to afford an opportunity to the petitioners in this regard.