# Hindalco Industries Limited v. Industrial Tribunal-I, U.P. at Allahabad and others

- **Citation:** (2012) 1 ILRA 474
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2012-04-27
- **Case number:** Civil Misc. Writ Petition No. 11997 of 1992
- **Bench:** Sudhir Agarwal
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/hindalco-industries-limited-v-industrial-tribunal-i-u-p-at-allahabad-and-others-42096
- **Pages:** 7

## Headnote

Constitution of India, Article 226-House
Rent
allowance-Labor
Court
allowed
reference in favor of workers-Hindalco
Company
situated
in
forest
areaconsidering shortage of accommodation
management given residential houses
those
who
worked
without
having
residential Quarter for 10 years-it can
work and wait the availability-for such
considerable
period-management
can
not
be
burdened
by
House
Rent
allowance-ignoring
this
aspect-award
not sustainable.

Held: Para 22

If some workmen have already worked
for decades together without being
dissatisfied
with
non-availability
of
housing accommodation or HRA in lieu
thereof, and they are given housing
accommodation seniority-wise as soon
as it becomes available, the Court finds
no justification to allow payment of HRA
to such workmen with such a long
retrospectivity causing an extraordinary
financial burden on the employer. In
fact, on this aspect also the tribunal has
not at all considered anything and in a
most casual and abrupt manner, also
without application of mind, it has
passed the award granting relief of
house
allowance
from
the
date
of
appointment. This direction, therefore,
also
in
my
view
is
illegal
and
unsustainable.
Case law discussed:
AIR 1960 SC 886; AIR 1959 SC 1035

## Text

474 INDIAN LAW REPORTS ALLAHABAD SERIES [2012
such, direct that the lady, Smt. Kavita, be
set at liberty immediately so that she
could go to the place or to a person, she
likes or chooses to.

7. With the above directions, we
dispose of the present petition.

8. Let a copy of this order be made
over to Sri R. A. Mishra, for onward
communication
to
the
concerned
authorities. Sri Mishra shall, in the
meantime, communicate by any means of
communication, the gist of this order and
that may be treated as the result of the
petition, so that the lady may not be
confined further.
---------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLHABAD 27.04.2012

BEFORE
THE HON'BLE SUDHIR AGARWAL, J.

Civil Misc. Writ Petition No. 11997 of 1992

Hindalco Industries Limited ...Petitioner
Versus
Industrial Tribunal-I, U.P. at Allahabad
and others

 ...Respondents

Counsel for the Petitioner:
Sri N.B. Singh
Sri Ritvik Upadhaya
Sri Vinod Upadhyay

Counsel for the Respondent:
Sri P.C. Jhingam
S.C.

Constitution of India, Article 226-House
Rent
allowance-Labor
Court
allowed
reference in favor of workers-Hindalco
Company
situated
in
forest
areaconsidering shortage of accommodation
management given residential houses
those
who
worked
without
having
residential Quarter for 10 years-it can
work and wait the availability-for such
considerable
period-management
can
not
be
burdened
by
House
Rent
allowance-ignoring
this
aspect-award
not sustainable.

Held: Para 22

If some workmen have already worked
for decades together without being
dissatisfied
with
non-availability
of
housing accommodation or HRA in lieu
thereof, and they are given housing
accommodation seniority-wise as soon
as it becomes available, the Court finds
no justification to allow payment of HRA
to such workmen with such a long
retrospectivity causing an extraordinary
financial burden on the employer. In
fact, on this aspect also the tribunal has
not at all considered anything and in a
most casual and abrupt manner, also
without application of mind, it has
passed the award granting relief of
house
allowance
from
the
date
of
appointment. This direction, therefore,
also
in
my
view
is
illegal
and
unsustainable.
Case law discussed:
AIR 1960 SC 886; AIR 1959 SC 1035

(Delivered by Hon'ble Sudhir Agarwal, J. )

1. Sri Vinod Upadhyay, Senior
Advocate, assisted by Sri Ritvik Updhyay
for the petitioner and learned Standing
Counsel for respondent no.1 and 3.
Initially, Sri P.C. Jhingam had put in
appearance and filed counter affidavit and
after his death notice was issued to
respondent no.2 to engage another counsel
vide order dated 21.10.2011. None has
appeared on behalf of respondent no.2
though the case has been called in revised
list.

2. The writ petition is directed
against the award dated 29th April 1991
1 All] Hinladco Industries Limited V. Industrial Tribunal-I, U.P. at Allahabad and others
475
of Industrial Tribunal-I, U.P. at Allahabad
(hereinafter referred to as "the Tribunal")
in Adjudication Case No. 40 of 1989
whereby the Tribunal has directed the
petitioner i.e., M/S Hindalco Industries
Ltd. (hereinafter referred to as "the
employer") to pay 10% of the basic pay
towards house allowance to workers who
are not provided housing accommodation
by the employer, from the date of their
appointment
till
such
time
housing
accommodation is not offered to them.

3. Respondent no.2 is a union of
workers
of
Hindustan
Aluminium
Corporation Limited, Renukoot, in district
Sonbhadra. An industrial dispute was
raised by the Union that some of the
workers who are not provided with
housing
accommodation
should
be
provided
house
rent
allowance.
A
reference was made for adjudication of the
above dispute vide State Government
notification dated 1.5.1989 under Section
4-K of U.P. Industrial Disputes Act to the
following effect:

"Kya Sewayojkon dwara apne kuchh
shrmikon ko avas suvidha athva avas
bharra na diya jana uchit tatha/athva
baidhanik hai? Yadi nahin, to sambandhit
shramika kya laabh/kshatpurti paane ke
adhikari hai, kis tithi se tatha anya kis
vivaran sahit?"

"Whether non-providing of housing
facility or housing allowance by the
employer to some of its workmen is
justified and/or legal. If not, whether the
concerned workmen are entitled to any
benefit or compensation and from which
date and with what details." (English
translation by Court)

4. It is this reference which has been
answered by the Tribunal in favour of
workmen as said above.

5. The area in which the petitioner's
industrial establishment is established was
basically a forest area in which about more
than 50 years ago, on the initiative taken
by State Government and the management
of the petitioner's industrial establishment,
a heavy industry was set up with multiple
objectives of contributing to the national
resources and also providing development
and employment to local inhabitants. The
adjacent area was mostly inhabited by
Adivasis and other very poor rural
inhabitants. It is the establishment of the
large industrial undertaking HINDALCO
which increased employment potential in
the area attracting a huge labour force from
the adjacent area as also the distant ones.
The basic requirement i.e. establishment of
industry obviously is to be catered first and
therefore, land became available to the
petitioner was mostly used for establishing
industrial undertakings. Besides thereto,
some residential accommodation had also
been
constructed
including
schools,
playgrounds
etc.
Some
residential
accommodation has been constructed for
the benefit of State's administrative
departments which is again for the larger
benefit of the industrial working force in
petitioner's industry, which at the time of
dispute in question was about 15000/-.

6. Outside industrial establishment,
private residential accommodation was
scanty and virtually people find it very
difficult to get a suitable accommodation
in and around 70 KM area in which the
industry
is
situated.
Since
the
accommodation available with the industry
is limited, the management followed
principle
of
seniority
for
allocating
476 INDIAN LAW REPORTS ALLAHABAD SERIES [2012
residential accommodation to labourers.
Such accommodation is provided free of
cost subject to charge of nominal amount
towards maintenance.

7. The case of the workmen is that
since the housing accommodation having
been provided free of cost to some of the
workers while others did not get it, they are
entitled for suitable house rent allowance
otherwise treatment of the industry would
be arbitrary and discriminatory. The
workers initially claimed housing rent
allowance (for short 'HRA') at the rate of
20%.

8. Sri Upadhyay contended that there
is no express or implied condition of
service obliging the employer to provide
residential accommodation or HRA to the
entire industrial force. Facility of housing
accommodation provided by the employer
was voluntary. The industry though
inclined to allot housing accommodation to
all its employees so that the workers may
serve the industry with much efficiency but
it has its own limitations inasmuch as the
land is not available. The industry is
corresponding and approaching the State
Government for acquisition of more land
but has not been successful therein so far.
In any case, the voluntary act on the part of
employer cannot be treated to be an
express or implied conditions of service to
provide free accommodation to labourers
or payment of HRA. The Tribunal having
failed to consider relevant aspects had
erred in law and therefore, the impugned
award is liable to be set-aside. Reliance is
placed on Apex Court's decisions in B.N.
Elias and Co. Ltd. Employees' Union
and others Vs. B.N. Elias and Co. Ltd.
and others AIR 1960 SC 886, Patna
Electric Supply Company Limited,
Patna
Vs.
Patna
Electric
Supply
Workers' Union AIR 1959 SC 1035.

9. Sri Vinod Upadhyay, learned
Senior Advocate further contended that the
basic obligation of providing housing
facility to the public at large is that of the
Government and not of the petitioner
Industry. There is no agreement between
the petitioner and respondent no.2 i.e., the
employer and employees that either
housing accommodation or allowance in
lieu thereof shall be provided. There is no
service condition to this effect. No
assurance ever held by the petitioner
industry to the workmen that after their
engagement/employment in service with
the petitioner industry, they would be
provided
housing
accommodation
or
allowance in lieu thereof. He contended
that in view of absence of any service
condition, the award of the Tribunal is
wholly illegal, unjust, unreasonable and,
therefore, liable to be set aside.

10. Learned Standing Counsel on the
contrary attempted to support the award for
the reasons stated therein

11. I have heard learned counsel
present for respective parties and perused
the record.

12. The award of Labour Court itself
shows that the place it is now known as
Renukoot was previously a village named
Jhokhai.
There
was
only
Adivasi
population in this village used to live in
hutments. The petitioner industry was
established
in
1960
and
production
commenced in 1962. The land was
acquired by the State Government for
establishment of the above industry and the
petitioner industry undertaking, besides set
up of their factory/plant also set up a
1 All] Hinladco Industries Limited V. Industrial Tribunal-I, U.P. at Allahabad and others
477
power generation unit and also built
residential colonies, schools, playgrounds
etc. for their employees.

13. Admittedly, there is no written
service condition agreement, contract or
anything alike which may entitle the
workmen either to get free housing
accommodation
or
HRA
from
the
petitioner
industry.
Considering
the
peculiar facts and nature of industrial unit
in its own interest, the industry has
constructed a number of residential houses
and allotted to its workmen/employees
who are permanent. Allotment is founded
on the criteria of seniority since number of
accommodation is lesser than the number
of workers claiming it. At the relevant
time, the industry was charging Rs.6/- per
month towards maintenance charges. The
employer's stand that there is no condition
of service obliging it to provide free
residential accommodation or HRA in lieu
thereof, was not found incorrect by the
Tribunal. There is no such representation
also by the employer. This is evident from
the following findings:

"It is also true that the basic duty to
provide industrial housing is that of the
Government and not of the employers. It is
also true that there is no agreement
between the workers and the employers
according to which house accommodation
is to be provided to workers. There is no
service condition to that effect. No
assurance is given to the workmen when
they enter into service that they will be
provided with house or else house rent."

14. However, having said so the
Tribunal then proceeded to observe that
since some of the workmen have been
provided
housing
accommodation
voluntarily, non-providing of housing
accommodation or HRA in lieu thereof to
others would be arbitrary. If the employer
on
its
own
has
provided
housing
accommodation, free of cost to some of the
workers i.e., about 50% , it amounts to an
implied service condition though there is
no any express condition in any agreement
to this effect. The Tribunal has further
applauded the welfare measures taken by
the employer of suo motu extending
facility of free housing accommodation to
its employees despite there being no lsuch
conditions of service and has also noticed
bona fide of the employer to provide
further
accommodation
subject
to
availability of land and construction of
houses thereon. However, this attempt on
the part of the employer has been
construed as an implied condition making
obligatory upon it to pay HRA to the
workers who are not provided with free
housing accommodation. In absence of any
other criteria, the Tribunal has upheld
HRA
rate
prescribed by
the
State
Government for its employees and has
followed the same by issuing direction to
this effect to the petitioner employer.

15. To my mind, this approach of the
Tribunal is not justified and reasonable in
the context of the entire matter. To
constitute a condition of service, there
must be something more than mere
conduct on the part of employer showing
that it has given some benefit to to some of
its employees. There must be something to
show that the employer intends to provide
the benefit as a part and parcel of the
condition of service to workmen. If
something is found in the agreement, there
would be no difficulty but otherwise, the
mere fact of granting certain benefit to
some of the employees, ipso facto, would
not and may not constitute an implied
condition of service unless intention of the
478 INDIAN LAW REPORTS ALLAHABAD SERIES [2012
employer and kind of representation to the
workmen to this effect is borne out from
some material.

16. In the present case, the employer
industry on their own have allotted
residential accommodation available with
them to the seniormost workers, free of
cost, and even to those workers there does
not appear to be any express or implied
condition of service that such benefit or
amenity
shall
be
extended
by
the
employer. The fact that nominal and
negligible amount is charged from the
workmen
who
are
allotted
housing
accommodation also shows that the
employer never intended to create any
interest in the housing accommodation on
the part of the concerned workmen and
that is how only token amount is payable
by the workmen which is termed as
"maintenance charges".

17. In providing voluntary facility of
housing accommodation, the industry
follows a genuine principle of seniority so
that those having longer service in industry
may get facility of free accommodation
first comparing to those who have lesser
service. The issue in question in my view
is squarely covered by Apex Court's
decision in Patna Electric Supply Co.
Ltd. (Supra). The Court, on the one hand,
upheld the power of industrial adjudicatory
forum to extend an existing agreement or
making of new one or creation of new
obligation or modification of old ones. It
also held that it cannot be doubted that in
appropriate cases, industrial adjudication
may impose new obligations on the
employer in the interest of social justice
and with the object of securing peace and
harmony between the employer and his
workmen and full co-operation between
them. In settling the dispute between the
employer and workmen the adjudicatory
forum under industrial law is not confined
to administration of justice in accordance
with agreement strictly. It can confer rights
and privileges on either party which it
considers reasonable and proper, though
they may not be within the terms of any
existing agreement. Its power is not
confined
to
mere
interpretation
or
executing
contractual
rights
and
obligations of the parties but it can create
new rights and obligations between them
which it considers essential for keeping
industrial peace. However, that itself does
not mean that whatever is considered by
the Tribunal in interest of workers can be
allowed
without
having
a
realistic
approach in the context of the entire
scenario, namely, the industry as well as
workers and public at large. Once an
industry is established, its sole object is not
confined to generation of employment but
the production which results in adding to
public resources contribute for national
development. Employment is one of the
ancillary and subsidiary developmental
activity which results due to establishment
of the industry going for production.
Health of the industry, its potential of
survival and continuance, contribution
towards national resources, etc., therefore,
cannot be undermined. The general interest
of entire public at large has also to be seen
in such matters.

18. The Tribunal found, in the
present case, that the area was extremely
backward where the industry in question
was set up in 1960. The State Government
invited establishment of the petitioner
industry offering certain exemptions and
concessions at the relevant time so that in
one of the most backward area in the State
of U.P. an industry of substantial potential
and of national importance may be
1 All] Hinladco Industries Limited V. Industrial Tribunal-I, U.P. at Allahabad and others
479
established. The petitioner industry is
contributing
to
national
development
which also includes defence requirement
since it produces aluminium. The industry,
instead of taking any undue advantage of
lack of bargaining power of workmen, on
its own and voluntarily constructed houses,
colonies,
etc.
and
to
the
extent
accommodation is available, the same is
being provided to workmen, following a
valid criteria of seniority.

19. The Apex Court in Patna
Electric Supply Co. Ltd. (Supra) has
observed that housing accommodation of
industrial
labour
is
the
primary
responsibility of the State. In the context
of
present
economic
conditions
of
industries, it would not be expedient to
impose
an
obligation
of
providing
housing
accommodation
upon
the
industry. It also said that scheme of wages
normally fixes the wages taking into
account factors relating to availability of
accommodation in the area concerned and
other relevant factors. It has also taken
note of the fact that Tribunals usually do
not
entertain
employees'
claim
for
housing accommodation and do not even
allow a separate demand of house
allowance as such. The Court has also
deprecated casual approach of imposing
obligation relating to housing facilities
upon the industry. In para 22 of the
judgment it said:

"..........The discussion of the problem
in these two chapters shows that housing
shortage can be conquered only by
sustained and well-planned efforts made
by the States and the industry together. It
is a very big problem and involves the
expenditure of a huge amount. Efforts are
being made by the Central Government to
invite the cooperation of industrial
employers to tackle this problem with the
progressively increasing financial and
other assistance offered by the State
Governments. But it is obvious that this
problem cannot at present be tackled in
isolation by Industrial Tribunals in
dealing with housing demands made by
employees in individual cases. In the
present
economic
condition
of
our
industries it would be inexpedient to
impose this additional burden on the
employers. Such an imposition may retard
the
progress
of
our
industrial
development and production and thereby
prejudicially affect the national economy.
Besides such an imposition on the
employers would ultimately be passed by
them to the consumers and that may result
in an increase in prices which is not
desirable from a national point of view. It
is true that the concept of social justice is
not static and may expand with the
growth and prosperity of our industries
and a rise in our production and national
income, but so far as the present state of
our national economy, and the general
financial condition of our industry are
concerned, it would be undesirable to
think of introducing such an obligation on
the employers today. That is why we think
the Industrial Tribunals have very wisely
refused to entertain pleas for housing
accommodation made by workmen from
time to time against their employers."

20. It is also said that before taking
any view with respect to housing facility
or HRA, in favour of the workmen,
financial ability of industry to meet the
additional burden must have to be
considered.

21. Admittedly, from a perusal of
the
impugned
award
any
such
consideration
is
apparently
lacking.
480 INDIAN LAW REPORTS ALLAHABAD SERIES [2012
Further, assumption on the part of the
Tribunal that giving free accommodation
to about 50% of workmen while depriving
others even from house allowance is
discriminatory, also has no basis for the
reason that the facility of housing
accommodation has not been extended by
employer on a pick and choose method
but subject to availability and is provided
following the valid criterion of seniority.
It is voluntary also.

22. Parity with State Government
employees is also something which has
misguided the Tribunal, inasmuch as,
once
it
is
held
that
housing
accommodation
is
the
prime
responsibility of State, what is applicable
to employees of the State Government
would not apply suo motu to employees
of a private industrial establishment.
Besides, the Tribunal has also not
considered anything as to how and why it
was justified in awarding HRA at the rate
of 10% of the basic salary from the date
of appointment of workmen, inasmuch as,
there is nothing on record to show that the
workmen
raised
any
such
dispute
immediately after their appointment or
within a reasonable time thereafter. If
some workmen have already worked for
decades
together
without
being
dissatisfied
with
non-availability
of
housing accommodation or HRA in lieu
thereof, and they are given housing
accommodation seniority-wise as soon as
it becomes available, the Court finds no
justification to allow payment of HRA to
such
workmen
with
such
a
long
retrospectivity causing an extraordinary
financial burden on the employer. In fact,
on this aspect also the tribunal has not at
all considered anything and in a most
casual and abrupt manner, also without
application of mind, it has passed the
award granting relief of house allowance
from the date of appointment. This
direction, therefore, also in my view is
illegal and unsustainable.

23. In view of the above discussion,
the
Tribunal
was
not
justified
in
answering the reference in favour of
workmen and the amount of housing
allowance awarded with retrospective
effect, cannot sustain.

24. Resultantly, the writ petition
succeeds and is allowed. The impugned
award
dated
29th
April
1991
in
Adjudication Case no. 40 of 1989
(Annexure 4 to the writ petition) is hereby
quashed.

25. No order as to costs.
---------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 20.04.2012

BEFORE
THE HON'BLE MANOJ MISRA,J.

Civil Misc. Writ Petition No. 15378 of 2009

Kuldeep Kr. Misra

 ...Petitioner
Versus
The Zila Prabhandhak and others

 ...Respondents

Counsel for the Petitioner:
Sri Manoj Kumar (Sharma)
Sri Sant Ran Sharma

Counsel for the Respondents:
Sri N.P. Singh
Sri N.P. Singh
Sri M.P. Singh

Constitution
of
India,
Article
226compassionate
appointment-claimed
after
18
years
delay-only
reason
disclosed
pendency
of
dispute
of