# ATIC INDUSTRIES LTD. ETC. ETC v. WORKMEN ETC. ETC

- **Citation:** [1972] 3 S.C.R. 770
- **Court:** Supreme Court of India
- **Decided:** 1972-03-14
- **Case number:** CIVIL APPEAL No. 809 OF 1968
- **Bench:** C. A. Vaidialingam, I. D. Dua
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/atic-industries-ltd-etc-etc-v-workmen-etc-etc-5613
- **Pages:** 14

## Headnote

Indus.'Tial Dispute-Transport Allowance Award of Tribunal making
~mptoyers liable to pay 15 pa se per day to entployee who had to tr vel
more than five mile!:.' to place of work-Awa. d ju~tified-Tribun1l when
may take into account principles
of social
justice
and
region-cum-1
indust.~.
The appellant companies cai'ried on the
busine~s of manufac\!uring
chemk:al in a vil:agr3.
There were disputes bet\\-een the companLs and
t.Uir workmen regarding
dearness allowance, trans;iort al owance
'3Dd
other demands.
In regard to transpdrt allowance the Tribunal in
its
award directed the employers to pay 1$ pabJ per day to workmen who
lived more th'3.n five miles away from the place of work exo~:::>t on days
when a workman was on leave.
In doing so the Tribunal took into ac ..
count the fact that in tl".e same region a pharmaceut'cal company was
paying transport allow:.lnce to its workmen.
The Tribunal rej.ec.ted the
contention of the companie that it was not t1e ob igafon of· an em·
ployer le provide transport facili cies for the wc:irkmen or to pay in whole
or in part their transport expemes.
In appeal by special leave,
HELD : ( i) The principle that in " proper case the Industrial Tribunal can imp<Y.c new obligation on the employer in the interest of social
justiee a'ld can also involve the parties in a new co.,tract has bee'l ac:.
cepted by this Court. There can be no doubt that an Jndmtrial Tribti·
.r h:i jurisdiction to make a propelr and reasonable order in an indJJs ..
Jrial dispute. [779 F; 780 Bl
(ii) Tu,, Tribunal was justified in having regard to the ]Jracti¢ ob·
ta"1ing_ in the region on the principle of reg·on-cum industry when considering the claim of the workmen for payme'1t of tra"'sport allowaice.
Tb.e foundation of the princi.,Je of region·cum-industry is that as far as
possible the1•! should be uniformity of conditions of service in com-oarable concerns in the indu try in the region as that thefe is no :m'iaJance
in the conditions of rr.rvice between workm·n in one 1!stablishment and
those in the rest.
The. danger otherwise would be migrafon of labour
to 'he one wt.ere th"'re are more r~vonrable conditions from those where
conditions are less favourable. (780 B-C; 781 A-Bl
(iii) When tbe Tribunal w:is fixing the wage scales and d,.rne-s al·
lowanCe it was aware that it had also to arljudi ~ate on a claim for .transport allowance.
Havin~ reg?rd to this claim it m11st h'lve fixr>..d the W"g~
sc<1Jes anrt dearness allowance.
Jn the scale of deafness allowance fiX·"d
by the Tribunal complete neutralisation ha~ "Ot beeri. awarded. The Tribunal had also proceeded on the basis that the \VOrkmen must bear, from
and out 'of the wages earned by them, a part of trans'"'IOrt exrr,nses.
It w•< only when the Tribunal found th~t t~e ext>en<e ;ncurred bv the
workmen for transport was rather high that it had afforded some lelief.
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AT!C INDUSTll!ES v. WORKMEN (V'aidialingam, J.)
771
A
No material had been placed before this Court on behalf of the com·
panies concerned to how that in the prepafat.on of the cos~ of l1v ng
inOOx in the arf3. concjerned transport expense can be taken int a ... ,...... n .
l/ol D-F; 777 GI
(iv) In the circumstances of the case it could not be stated that I.le
award of th.e sum of 15 paise per day was in any· man.ier tor ~aion .. ble
8
or arbitrary. The pay~nt had ':l!so beon hedipd in by the conJiiion
~.
that the employer had to be satisfied that the workman was s:ay'ing at
a piace five mile
and over from the p'ace of work and that it
n.i~d
not be paid on days when the workman was either on earned leave or
any type of leav~ authorised or- Otherwise. The Tri -iunal had also 'aken
into account the financial capacity of the appellants and there was no
flow in its reasoning. [782 F; 783 Al
C
Ahmedabad Mill Owners' Associa•ion e'c, v. The Tedfo Labour
Association, [19661 I S.C.R. 382; The Patna Electric Supoiy Co. Lt1.
Paino v. The Patna. Electrlc Supply Worker<
Union, [19B] Supp'. 2,
S.C.R. 761; Moham

## Text

770
ATIC INDUSTRIES LTD. ETC. ETC.
v.
WORKMEN ETC. ETC.
(Wilh Connec'.ied appeals)
March 14, 1972
[C. A. VAIDIALINGAM AND I. D. DUA, JJ.]
Indus.'Tial Dispute-Transport Allowance Award of Tribunal making
~mptoyers liable to pay 15 pa se per day to entployee who had to tr vel
more than five mile!:.' to place of work-Awa. d ju~tified-Tribun1l when
may take into account principles
of social
justice
and
region-cum-1
indust.~.
The appellant companies cai'ried on the
busine~s of manufac\!uring
chemk:al in a vil:agr3.
There were disputes bet\\-een the companLs and
t.Uir workmen regarding
dearness allowance, trans;iort al owance
'3Dd
other demands.
In regard to transpdrt allowance the Tribunal in
its
award directed the employers to pay 1$ pabJ per day to workmen who
lived more th'3.n five miles away from the place of work exo~:::>t on days
when a workman was on leave.
In doing so the Tribunal took into ac ..
count the fact that in tl".e same region a pharmaceut'cal company was
paying transport allow:.lnce to its workmen.
The Tribunal rej.ec.ted the
contention of the companie that it was not t1e ob igafon of· an em·
ployer le provide transport facili cies for the wc:irkmen or to pay in whole
or in part their transport expemes.
In appeal by special leave,
HELD : ( i) The principle that in " proper case the Industrial Tribunal can imp<Y.c new obligation on the employer in the interest of social
justiee a'ld can also involve the parties in a new co.,tract has bee'l ac:.
cepted by this Court. There can be no doubt that an Jndmtrial Tribti·
.r h:i jurisdiction to make a propelr and reasonable order in an indJJs ..
Jrial dispute. [779 F; 780 Bl
(ii) Tu,, Tribunal was justified in having regard to the ]Jracti¢ ob·
ta"1ing_ in the region on the principle of reg·on-cum industry when considering the claim of the workmen for payme'1t of tra"'sport allowaice.
Tb.e foundation of the princi.,Je of region·cum-industry is that as far as
possible the1•! should be uniformity of conditions of service in com-oarable concerns in the indu try in the region as that thefe is no :m'iaJance
in the conditions of rr.rvice between workm·n in one 1!stablishment and
those in the rest.
The. danger otherwise would be migrafon of labour
to 'he one wt.ere th"'re are more r~vonrable conditions from those where
conditions are less favourable. (780 B-C; 781 A-Bl
(iii) When tbe Tribunal w:is fixing the wage scales and d,.rne-s al·
lowanCe it was aware that it had also to arljudi ~ate on a claim for .transport allowance.
Havin~ reg?rd to this claim it m11st h'lve fixr>..d the W"g~
sc<1Jes anrt dearness allowance.
Jn the scale of deafness allowance fiX·"d
by the Tribunal complete neutralisation ha~ "Ot beeri. awarded. The Tribunal had also proceeded on the basis that the \VOrkmen must bear, from
and out 'of the wages earned by them, a part of trans'"'IOrt exrr,nses.
It w•< only when the Tribunal found th~t t~e ext>en<e ;ncurred bv the
workmen for transport was rather high that it had afforded some lelief.
A
B
c
D
E
G
AT!C INDUSTll!ES v. WORKMEN (V'aidialingam, J.)
771
A
No material had been placed before this Court on behalf of the com·
panies concerned to how that in the prepafat.on of the cos~ of l1v ng
inOOx in the arf3. concjerned transport expense can be taken int a ... ,...... n .
l/ol D-F; 777 GI
(iv) In the circumstances of the case it could not be stated that I.le
award of th.e sum of 15 paise per day was in any· man.ier tor ~aion .. ble
8
or arbitrary. The pay~nt had ':l!so beon hedipd in by the conJiiion
~.
that the employer had to be satisfied that the workman was s:ay'ing at
a piace five mile
and over from the p'ace of work and that it
n.i~d
not be paid on days when the workman was either on earned leave or
any type of leav~ authorised or- Otherwise. The Tri -iunal had also 'aken
into account the financial capacity of the appellants and there was no
flow in its reasoning. [782 F; 783 Al
C
Ahmedabad Mill Owners' Associa•ion e'c, v. The Tedfo Labour
Association, [19661 I S.C.R. 382; The Patna Electric Supoiy Co. Lt1.
Paino v. The Patna. Electrlc Supply Worker<
Union, [19B] Supp'. 2,
S.C.R. 761; Mohamed and Sons v.
Their Workmen,
[1968] 1 LL.I.
536, Remington Rand of Jnd'a ·Ltd. v. Workm•n, [1969] ( IY I
F.L.R.
46 and The New Maneck Chowk
Spinning/ and
W•aving Co,
Ltd.
Ahmedabad and others v. The Textile Labour Association
Ahmedabad,
D
f19611 3 S.C.R. I, applied.
.
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 742 of.
1968.
Appeal by special leave from the Award dated November 15,
1967 of tl!e Indus;trial Trib,unal, Gujarat In Reference (l.T.) No.
E 65 of 1966.
AND
CIVIL APPEAL No. 809 OF 1968.
Appeal by special leave from the Award dated October 16,
'1967 of the Industrial Tribunal, Gujarat in Reference (l.T.) No.
r
60 of 1966.
AND
CIVIL APPEAL No. 2086 OF 1968.
Appeal by special leave from· the Awards Part I & II dated
G September 27, 1967 aiid Novembei 1$, 1967 of the Inchistri-1
Tribllllal, Guja~at in Reference (I.T.) No. 65 of 1966.
H
A •. K. Sen, V. B. Patel, I. N. Shroff and M. N. Shroff, for the
appcJJant, (in C.A. No .. 742 of 1968).
M. C. Setalvad, V. B Patel and I. N. Shroff, for the appellant
(in C.A. No. 809 Of 1968).
Nat/ml G. Phillinis, Janardmi Sharma and Indira lai Sing~. fllr
Ike appellants (in C.A. No. 2086 of 1968) respolldenls (in C . .A.
772
SUPREME COURT REPORTS
[1972] 3 S.C.R.
. No. 742 of 1968) and respondent No. 1 (in C.A. No. 809 of
1968).
M. C. Setalvad, V. B. Patel, I. N. Shroff and M. N. Shroff, for
respo'.ldent No. 1 (in C,A. No. 2086 of 1968).
The Judgment of the Court was delivered by
Vaidialingam, J.-Civil Appeal Nos. 742 and 2086 of 1968,
by sp~cial leav~, arise out of the decision regardmg demand No. 4
under Award Part II, dated November 15, 1967 of the Industrial
Tribunal, Gujarat, in Reference (IT) 65 of 1966.
As
Alic
Industries Ltd., and its workmen could not settle the various
demands made by the latter, on the joint application of both, the
Deputy Commissioner of Labour, Ahmedabad, by order dated
February 19, 1966 referred for adjudication to the Industrial Tribunal, Gujarat, nine demands made by the workmen.
The
~demands cover various matters and have been elaborately set out
in the Schedule annexed to the order of reference. It is enough
to note that the demands covered revision of wage scales, dearness
rulowance, shift allowance, vacation travelilng allowance, housing
facilities etc. Demand No. 4, with which we are concerned was as
follows :
"All workmen who make use of the S.T. Bus Service ·
shall be paid Rs. 20/- j)er month as Bus Allowance and
those workmen who come Cycling from places where
S. T. Bus Service is not available shall be oaid Rs. 15 /-
per month as Cycle Allowance and also those workmen
who come by train shall be paid Rs. 10 /- per month as
Train Allowance."
The Industrial Tribunal by its Award, Part I, dated Seotember 27,
1967 disnosed of demands Nos. I, 2, 3, 6 and 9. By iis Award,
Part H, dated November 15, 1967, the Tribunal
disposed of
ch-n°nd Nns. 4. 5. 7 ancl 8. Jn resnect of demand No. 4, the
Tribunal directed the Company (A tic Industries Ltd.) to pay an
allowance of 15 paise per day to every employee who siavs at a
distonr.e of five miles or more from villa~e Atul.
The Tribunal
directed this payment to be made with effect from fanuarv
I,
1968. The Tribunal further directed that the allowance need not
be paid for days on which the wor1<man is on earTJed leove or
any tvne of foave authorised or otherwise.
Atic Industries Ltd.
has fil•d Civil Apneal No. 742 of 191'i8 challenqing the grat\t of
this allowance to its workmen.
The workmen have filed
Civil
A'>n•al No. 20% of 1968 chollenqinrr the various m"tters covered
bv the Award Parts I and. JI, reqarding warre scales, dearne<s
allowance etr.. in <O far•• the Aw.rel was """inst them. In narticular, regarding demand No. 4 they have claimed, in the appeal,
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ATJC INDUSTRIES v. WORKMEN (Vaidialingam, !.)
773
that a higher allowance should have been granted by the Tribunal.
But this Court, by its order dated September 24, 1.968 has restricted the Special Leave only to the question of transport ailowance.
Therefore, the various other points raised by the workmen in
their ar:ieal no longer survive. While the Company in its appeal
No. 742 of 1968 wants the allowance granted under demand No.
4 to be set aside, the workmen, on the other hand, in their appeal
No. 20~ 5 of 1968 require the aHowance to be enhanced.
Civil Appeal No. 809 of 1968 i> by special leave; and the
appellant therein is Atul Products Ltd., which also is an industry
located h Atul village.
Here again, on the joint application of
the said Company and its workmen, nine demands were referred
for adjudication to the Industrial Tribunal, Gujarat, by order
dated June 30, 1966 of the Deputy Commissioner of Labour,.
Ahmedabad.
The demands related to dearness allowance, shift
allowance, housing facilities, vacation travelling allowance etc.
Demand No. 6 wW1 which we are concerned in this appeal was
as follows :
"Company shall provide free transport facility to all
workmen. Till such time free transport is made available every workmen shall be paid an
allowance of
Rs. 15/- per month."
The Industrial Tribunal, by its. Award Part I, disposed o!
demand Nos. 1 to 4 and 7. By its Award Part II, dated October
16, 1967, the Tribunal disposed of demand Nos. 5, 6, 8 and 9.
The decision of the Tribunal under its Award Parts I and II in
resoect of demand Nos. 1 to 5 and 7 to 9 is not the subject of consideration before us. In resoect of demand No. 6, the Trib1rnal
rejected the demand re~arding the Comnany b
0in~ made to nrovide free transport facilities.
However, the Tribunal directed the
Com.,anv to nay an allowance of 15 naise ner dav to everv employee who stays at a distance of five miles and above from village
A•uL
The said nayment was made effective from December 1,
1967. Here a2ain a llirection was 2iven that the Comna11v need
not nay allowance to i's worl<:men who is either on earned leave or
any tvne of leave authorised or o•herwi,e. The Co111,.,anv de<ires
in, thi, anneal to ]love the direction given by the Tribunal under
this demand set aside.
From the facts stated above, it will be se
0 n that the common
que,tio'l that ari,es fnr con'i~erati<ln in all the'e three anne1ls
rehtes to the claim of the workmen for navme"t of transoort allowanre t() enflhl~ them to ~O from thPif T'lll"e Of rec:ir1~t1"P, to-thP: nlqcc
Of WOT1<-,
W~ Jl1RV fll~O ~t3tP that the fPferf"nrP,~ in both the l''lqf+CfS
were made by the Deputy Commissioner of Labour, Ahmedahad,
774
SUPREME COURT REPORTS
(1972]3 S.C.R
as such a power had been delegated to him by the State GovernA
ment under s. 39 of the lndusmal Disputes Act, 1947 ..
Both Atic Industries Ltd. and Atul Products Ltd., are public
limited compames.
They manufacture dyes and chemical
and
o.ther 1menhed,a,es. Both thJ compames were havmg tneir factories m village Atul.
The basis of the claim made by the workmen of bolh these Companies for payment of transport allowance
·B
and the defence raised by the two concerns were substantially the
same. ln support of its demand .the Union had stated that the
majority of the workmen employ~d in the two Companies come
from a distance of about five to ten miles .. As the factories are
not situateJ in a place where labour force ii available easily, the
majority of the workmen have to come from distant villages or ·c
the town of Bulsar. The.re is no adequate transport reaching the
site of the factories. The Stare Road Transport Corporation runs
buses to reach the site of the factories, but the service is not
regular or adequate. A workman has to incur a ·bus fare of 40
pai;e per trip from Bulsar to Atul and another 40 paise for the
return journ:y. Therefore, each day a workman had to incur 80
paise as bus fare in going to village Atul from Bulsar and this was
too much of an ex.,ense which could not be borne by an employee
from and out of his wages.
[)
In the case of Atul Products, the demand was for a uniform
allowance of Rs. 15/- per month, though in the case of Atic
Industries Ltd., the demand was slightly different. The Union in
this connection relied on the Award in the case of Cynamid India
Ltd., which was a pharmaceutical industry in Atul region.
Both the Companies opposed the demands of the workmen on
the ground that it is not the function or dutv of an employer to
provide transport facilities for its workmen to come to their place
of work. It was further pleaded that there is a good road from
Bulsar to village Atul and the State Transport Service, which was
running buses on the said route was easily available to all the
workmen both for coming to vi!lage Atul and also for going ba~k
home. In addition to t)le bus service, there was also a tram
service which was available to the workmen. The Com1'anies
further nleaded that most of the workmen employed in the two
Com,,anies were Iivin11; in the nearby villa~es and
they ne.ver
d~oended upon ei•her the bus service or the train service. Even
at the time when the workmen took ll" emnlovm
0 nt in the far.tories,
thev should have known that thev will have to go •o their Pl~ce of
work at their own ex.,,,mes. On all the<;e grounds the claim of
the workmen was resisted by both the Comnanies.
,
It is seen that in re<'.)ect of Cynamid India: Ltd., .which was in
the same region, though in the pharmaceutical mdustry, the
E
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ATIC INDUSTRIES v. WORKMEN (Vaidialingam, J.)
775
Tribunal had occasion to consider a claim made by its workmen
for free transport facllites or for paym~nt of fixed transport altowance at the rate of Rs. 15 /- per month. It is further seen that
Cynamid lndla Ld., was already paymg 15 pahe per day for
ev~ry wrokmen who was staying five miles and more from village
Atul.
The workmen demanded that whole of
the transp()rt
expmses incurred by them, which was of 80 paise per day, must
be paid.
This demand w~s considered by the Tribunal in its
Award published in State Gazette on September 3, 1966. In t)lis
award, a copy of which has been placed before us, it is seen that
the Tribunal has rejected the claim of the workmen for directing
the Company concerned to provide free transport. But in respect
of the further claim for increasing the transport allowance, the
Tribunal has ultimately.increased the allowance from 15 p~ise to
3 7 paise per day to every employee who was staying at a distance
of five miles and more from village Atul. The Tribunal has also
granted an allowance of 12 paise per day to the workmen of
Cynamid India Ltd., who were staying beyond three miles but less
than five miles.
As we have mentioned earlier, the claim for transport allowance was made by the Unioμ mainly on the basis of the award of
the Industrial Tribunal in the case of Cynamid India Ltd. Though
the Tribunal did 11ot grant the enhanced allowance fixed by it in
the case of Cynamid India Ltd. and also the further allowance
granted therein to employees Staying beyond three miles but less
than five miles, the Tribunal in the case of Atic Jndustries Ltd.
and Alu! Products Ltd. has awarded only a sum of 15 paise per
dav for those workmen who were staying five miles and more from
village Atul.
In Civil Appeal No. 809 of 1968 Mr. M. C. Seta!vad, learned
counsel for the appellant, apart from conte,ting the grant 0f transport allowance to the emnloyees on the ground that it is not the
function of an employer to provide transnort facilities or to pay
allowance for the same, has raised an objection to the jurisdiction
of the Tribunal to give ·any such direction.
We have already referred to demand No. 6, which is the subject ef consideration in this apneal.
According to Mr. Se'alvad,
the demand is to the effect that the Com,,any should provide free
trans'10rt facilities to its workmen and till such facility is provided the wor1<men should be paid an allowance of. Rs.
15 /-
per
mon•h. The counsel further poin•ed out that in. this case the
Tribunal has rejected the d0 mand of the workmen for provision
for free transnort. Once this claim wa, reiected on the ground
that •he emoloyee are no• entitled to be nrovided free tran<nori. no
further question arose for consideration before the Tripunal.
776
SUPREME COURT REPORTS
[1972] 3 S.C.R.
According to Mr. Setalvad the claim for payment of an allowance
of Rs. 15 /- per month is only for the interim period th3t will necessarily be ta\cen by the Com!:Jany to make arrangements for providing free transport, if the claim in that regard of the workmen had
been acc~ted. The latter part of the demand beipg only for an
interim period, had to be straightaway rejected when ··once the
main demand providing free transport made by the workmen was
rejected. Therefore, it is the contention of Mr. Setalvad that the
Tribunal's direction regarding payment of
allowance under
demand No. 6 is without jurisdiction.
The above contention of Mr. Setalvad has been controverted
by Mr. Phadnis, learned counsel for the Union. According to
the learned counsel, the demand is really in the alternative, namely, that the Company should be made to provide free transport
facility. If this is not feasible, the Company should pay an
allowance of Rs. 15/- per month.
The counsel has also drawn
our attmtion to the reasons given by the Tribunal in the case
of Cynamid India Ltd. for rejecting the claim for orovision of free
transport.
The Tribunal has itself referred to those reasons in the
present Award in resoect of both the Com-ianies. Therefore, even
though the claim for provision for free transoort was rejected, the
Tribunal had to deal with the alternative claim for payment of
Rs. 15/- per month.
We are not inclined to accept the contention of Mr. Setalvad
that the Tribunal had no jurisdiction to consider the quantum of
trans'lort allowance to be oaid to the workmen when once it has
rejected.the claim of •:he Union for provision of free
transpcirt.
The cbim was a very t~U one, namely, that the Company should
provide free transport facilities to all its workmen.
The latterpart of the demand should really be understood as an alternative
claim if free transport is not provided by the Company. If the
Company was wiiling to provide free transnort facilities,
then
there will be no question of any transport aliowance being paid
to the workmen and the second par: of the deman:I may not arise
for consideration. But it does not follow that when the claim for
fre, transport facilities is rejected, the cl~im for transoort allowance no longer survives.
In our opinion, the proper way of looking at the demand is to treat the claim as one for provision of free
trans~ort facility and in the alternative for payment of an allowance of Rs. 15/-·per month. The claim for payment of allowance
is not, as contended by Mr. Setalvad for an interim sta~e covering the period taken by the Company to make arrarigement' for
providing transport facilities, when once it has been directed to the
so by the Tribunal.
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ATIC INDUSTRIES v. WORKMEN (Vaidialingam, J.)
777
A
The contention of Mr. Setalvad that the Tribunal had no
jurisdiction to give direction for paying transport aliowance after
rejecting the claim of the Union for the Company making provision for free transport, will have considerable force, if the Tribunal
had rejected the claim for free transport on the ground that the
employer is not under any circumstance liable to make any such
B
arrangement or bear transport expenses incurred by the workmen
either in whole or in part. As we will show presently the ground
on which the Tribunal rejected the claim of the Union that the
employer should provide free transport was not on the ground
that the employer is under no circumstance liable to provide the
same, but because of the fact that a sound transport system existed
c on the route and as such was conveniently available. to the workmen.
D
It will be pertinent to note the reasons given by the Tribunal
in Cynamid India Ltd. for rejecting the claim of the workmen in
that concern for making provision for free transport facilities. We
are . referring to this aspect because the Tribunal in the case of
Atul Products Ltd. has rejected the claim for free transport on
the same ground as given by it in Cynamid India Ltd. The reason
given by the Tribunal is that there whould be justification for a
Company being made to provide free transport only if a sound
public transport sytem did not exjst or was not conveniently available. The Tribunal has held that for going to village Atul from
E
Bulsar, public transport is available. It is on this ground that the
Tribunal held that it will not be justified in conceding the demand
for free transport. It may be mentioned that Cynamid India Ltd.
was admittedly providing free transport for its supervisory staff
and for that purpose it was maintaining a fleet of vehicles. But,
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nevertheless, the Tribunal rejected the claim of . the workmen
therein for provision being made for free transoort. It was represented by Mr. Phadnis, learned counsel for the union, that Atul
Products Ltd. and Atic Industries Ltd. give a special conveyance
allowanee to their sunervisory staff. But so far as this is concerned, the counsel also frankly admitted that no material in this regard
has been placed in the record of these appeals. Hence we leave
that aspect out of consideration.
Now coming to the attack on behalf of the two Comoanies
regarding the grant of transnort allowance, Mr. A. K. Sen and
Mr. V. B. Patel, who followed him, urged, that the workmen when
thev took uo em11loyment in the factories at village Atul knew full
H
well that they have to incur expenses for going to their place of
work. It wa, also noin•ed out that the de~rne's allowance had
been revis•d by the Tribunal by its award Part I and that is sufficient to enable the workmen to meet the transport charges that
718
SUPREME COURT IU!PORTS
[1972] l S.C.R.
they will have to incur for going to their place of work. In any
even~, it was urged, it is not the obligation of the employer to
provide transport taciiites or to bear either in whole or in part the
transport expenses of an employee incurred by him for going to
his place of work.
On the other hand, Mr. Phadnis, learned counsel for the Union
pointed out that ihe Tribunal has QOt accepted the entire clam;
made by the Union, nor has it gran.~ transport allowance at the
same rate given by it in the case of Cynamid India Ltd., The
counsel pointed out that Atul Products Ltd. and Atic Industries
Ltd. and Cynamid India Ltd. are all situated in village Atul.
Atic Industries Ltd. and Atul Products Ltd. are no doubt doing
business in manufacturing dyes, whereas Cynamid India Ltd. is a
pharmaceutical industry.
The employees working in the same
region should have the same facilities and it is on this principle
that the Tribunal has awarded transport a!lowan~e and that to a
lesser degree than that prevailing in Cynamid India Ltd. The
Tribunal itself has held that the workmen must share a part of the
expenses and it is on that ground that though a workmen has to
incur 80 paise per day, he has been granted only 15 paise per day.
Accordin~ to the learned counsel, the circumstances of the case
also justify the said grant.
We are of the opinion that the grant of 15 paise per day as
transport allowance to those employees staying live miles and
beyond is justified in the circumstances of this case. The Tribunal
itself has held that the Company must be satisfied that the workmen come from a place like Bulsar or places equally distant und
no allowance need be paid on days when the workman is on
earned leave or any type of leave authorised or otherwise.
On
behalf of the Companies it was stated that in calculating the cost
of living index, bus fare also is taken into account. No doubt in
Ahmedabad Mill Owners' Association Etc. v. The Textile Labour
Association,(1) it is stated that In the preparaiiail of the wst of
livincr inucx, various items including lius fare ure
taken into
acco~nt. But it is to be noted that the observation in the said
decision is that ucually the items mcnioned :hcr.::in inc!u<ling •he
bus for·e urc tal;c:i· in•o a:couqt.
But Mr. Phac:!nis, roimeJ out
by reference to the book "Cost of Living Incle' Numbe.r; in
Ind'a'' a Mon~g;aph, published by the Lnbour Buronu, Mn!rsr;y
of Lab-:iur, Gov::rnin-:nt of India that so far as /-\hn1cdab:.tJ
is
co;icerned, bus .far~ is r.ct ta!~en into account in th•~
pre~"!ora.;.ion
of cost of Jiving i:1d ~x. In contrast, he referr~<l us to the R<tnr:hi
area w1'ere trave]ii'g cxc.•'lse is taken into a:cou·1t in 'he p· epara·ion of cost of living index.
No material has
been rbced
b~fore us on behalf of the Companies concerned to show that in
(1) [1966] I S.C.R. 382.
A
B
c
D
E
F
c
n
A
B
c
D
E
G
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Atl<: ~DUSTR!ES \I. WORKMEN (Vaidialingam, !.)
779
the preparation of the cost of living index m the area concerned
trans,,on expense IS ta..cn mto account.
l'ne dec.s10ns m 1'he Patna Electric Supply Co., Ltd. Pama
v. 1'ne t'Wflu c..OClrtC ;:,upp1y workers' Umon\ 1) and Mohammea a/Id .JOflS v. l'netr Workmen(•) we.e rererreJ to us oy
Mr. P •tel wn.:rern n has been he1d that proviu,115 or noushlg
accommodauon is qot tile dmy o! an e1npioyer amt u1at tne rcspons.oJ,.y ror the same is tnat of the uovernmem.
ln our
opm.on, a c.atlll wr providing housing accommodauon is totaJy
dilferent from a 1:1aim maoe ror tran.port allowance, 1n fact m
th~ presenc awaros, th~ Tnbunal has rejected the claim or the
wor.:H\e,, 10r nousrng tacmues being provided- by both the Companies. Similarly, the decision in l<em.ng1on Rand of India Lid.
v. workmen ( •) of this Court regarding lunch allowance does
not also assist the Companies before us.
It was held in tM said
decision that normally when the wage structure iS fair· and dearness ailowance is paid to the workmen lm.:ed with the index of .
cost of living, they must take care of the rise in the cost of living
from time to time and therewre a company cannot be compelled
to pay lunch allowance to all workmen.
In that decision, it
wt!J be noted, that the lunch allowance was b~ing paid by the
company _concerned .to workmen who had to go to distant places
and could not remm to the office during lunch oeriod. But the
rate of allowance to such employees was raised by this Co<lft no
douDt by consent of the Company.
But the extension of that
allowance to other employees who had to work only in the
factory or office premises was rejected. In this connection it
was observed that the financial ability of an employer to
~ar
the , dditfonal burden is not criterion. The principle that in a
proper case the Industrial Tribunal can impose 1.ew obligation
on the employer in the interest of social justice and can
aiso.
involve tht parties in a new contract has b;:en recognised by this
Court in The Patna Electric Supply Co., Ltd. f'.atna v. The Pa;na
Electric Supply. Workers' Union('), and The New Maneck Chowk
Spinning and Weaving Co. Ltd. Ahmedabad and others v.
T~e
Textile Labour Associatio~. Ahmda?ad('). No doubt the said
jurisdiction of the Tribunal is condi•ioned by l"e l.aws . and
judicial pronouncements. In fois cc~nec1ion the lullowm3 oo>ervation of Ludwig Teller in "Lab:im Disnutcs & L.:ollecuve Bargaining" (Volume I, page 536) is r.pposite :
"Industrial arbitration may involn the
extension
of an existin~ a~reement or the m~•'--in.~ o~ a new on'.,
or, in general, the creation of new ob1Ig1t1ons o'. m~d1lica•ion of old ones
while commercial
arb;trat10n
(i)[1959] Suool. 2 S.C.R. 761.
(') [1969] (19) F.L.R. 46.
(') [19681 TL.L.J. 536.
(') 119611 l S.C.R. I.
780
SUPRl!ME COURT REPORTS
(1972] 3 S.C.R.
generally concerns itself with interpretation of existing
A
obligations and disputes relating to existihg agreemenJ.s."
. The ab~:>Ve observations have been quoted with approval by
this Court m some of its earlier decisions. Therefore, there can
be no doubt that an Industrial Tribunal has jurisdiction to make
a proper ~nd ~easonable order in any, industrial dispute. It should
be borne m mmd that the foundation of the principle of industrycum-region is that as far as possible there should be uniformity of
conditions of service in comparable concerns in ihe industry in
the region so that there is no imbalance in the conditions of a
service between workmen in one establishment and those in the
B.
rest.
The danger otherwise would be migration of labour to the c
one where there are more favourable conditions from those where
conditions are less favourable.
It is pertinent to note that though this Court in °1{emington
Rand of India Ltd. v. Workmen(') declined to extend the
benefit of lunch allowanee to employees who had no occasion
to go for out door work, nevertheless it recognised in a limited
measure the obligation of an employer to provide medical facilities for its workmen.
The demand for provision for medical
facilities made by the workmen was contested by the Company
therein on the ground that making provision for medical facilities
is the responsibility of the Government and not of the employer.
Even on the basis that it is the obligation of the employer, it \\as
further contended that medical expenses which a workman would
ordinarily have to incur are looked after aμd taken into account
when fair wages are settled. This Court accepted as correct the
contention that the primary responsibility for providing medical
facilities for citizens is that of the State. This Court also accepted the contention that while fixing fair wages, medical expenses
which may have to. be ordinarily incurred by a workman will be
taken into consideration. But on the basis that the expenses for
medical facilities would have been taken into account in the fixaD
E
F
G
tion of wages only to a. l~n_tlted extent artd as the ~t~te can!lot
discharge its full respons1b1hty in t~e mattei: of pro".1d1!1g.rn.ec1ic:U
facilities, this Court held that a Tnbunal will have 1unsd1cuon m
a proper case to .call u~n an emoloy~r to shoulde~ a part of
the.burden regardmg medical expenses mcurred by his v;orktnan
in the in•erest of industrial harmony and good co-onerat1".e relations. We are emohasisin~.the said decision which reco.gmsed an
emolover being maae to s)toulder a o.art of the burd~n •.n respe~t
of medical exoenses, as more or l~s the same prmcmle will
apply in the matter of an emoloyer bein~ asked to reimburse the
workman at least to· a limited exten~ regard!ng
the transoort
H
expenses incurred by the latter for gomg to htS place of work.
(') [1969] (19) F.L.R. 46.
I••
ATIC INDUSTRIES v. WORKMEN (Vaidialingam, J.)
781
We have already pointed out that in Atul village apart from
the !WO C.ompani~. there is another ~On~ern also.. Though Cynamtd India Ltd. 1s m the pharmaceutical mdustry, m our opinion
the Tribunal was justified in having regard to the practice obtain'.
ing in that region on the principle of region-cum-industry when
considering the claim of the workmen for payment of transport
8
allowance. It is no doubt true that in the case of Cynamid India
Ltd. that Company was already paying 15 paise per day to every
one of its workmen as transport allowance and that amount has
been raised by the Tribunal to 37 paise per day.
It has also
granted even to workmen living beyond three miles but less than
five miles a sum of 12 paise per day. ·But the very fact that
C
Cynamid India Ltd. was paying even originally 15 paise per day
was a relevant factor to be taken into account as the said industry
was also in the same region and most of its employees were also
coming from distant places like the workmen in the case of the
two Companies before us.
It should also be remembered that
the Tribunal, in the awards in question, was not considering an
o isolated claim for payment of transport allowance. That demand
was only one of the demands, which was being dealt with by the
Tribunal along with various other demands such as revision of
wage scales, dearness allowance etc. The Tribunal can certainly
be expected to be aware of the fact, when it was fixing the wage
scales and dearness allowance that it has also to adjudicate ori a
E
claim for transport allowance. Having due regard to this c'!aim,
it must have fixed the wage scales and dearness allowance. We
have gone through the scale of dearness allowance fixed under
the two awards and it is to be seen that complete neutralisation
has not been awarded. The Tribunal has also proceeded on the
basis that the workmen must bear, from and out of the wages
earned by them, a part of transport expenses. It is only when
F
the Tribunal found that the expense incurred by the workmen for
transport was rather, very high and excessive that it has afforded
some relief. If the entire body of workmen come from dist?nt
places and they all have to incur heavy expenses for using tran~
port, the question may pertinently arise whether it is not a case
for revision of wage scales or dearness allowance in such a manG ner as to include also this item of expense. The Companies have
provided some accommodation in the village itself for about
25 % of its workmen on a nominal rent. Some other are living
near about the village itself and they have no necessity to spend
any amount for transport. In resnect of these two categories of
work111en, there cannot be a general rise in the wages ·paid to
them. On the other hand, the case of workmen who come from
H
distant places, due to no fault of theirs, stands on
~ di.fferent
footing,
It is not oossible for them to cover the entire distance
walking and they have necessarily to use
some transport for
4-L!06!Sup Cl/72
782
SUPREME COURT REPORTS
(1972] 3 S.C.R.
coming to their place of work.
Quite naturally, one can expect
the workmen to choose only that type of transport which will cost
them the minimum. Even if they choose the train service, which
will be compartively cheaper, they will have to incur additional
expense for coming to their place of work and return home.
,
It must be noted that though the claim was for payment of
80 paise per day per worker to cover the entire cost of transport
to and fro, the Tribunal has awarded only a moderate sum of 15
paise which was the amount that was being paid by .Cynanud
India Ltd. originally.
In_ the case of Atul Products Ltd.
as
against the claim made for an allowance of Rs. 15 /- per month,
for every workman, the Tribunal has allowed only 15 paise per
day and that too op the days when the workman comes for duty.
Similarly, in the cace of Atic Industries Ltd. the demands were :
(a) Rs. 20/· per month to be paid to every workman using State
Transport Bus Service; (b) Rs. 15/- per month to be paid to
every workman coming by cycle from places where State Transport Bus Service was not available; and ( c) The workmen who
come by train should be paid Rs. 10/-
per month as train
allowance. As against these varying demands, the Tribunal has
only allowed 15 paise per day and that too on the days wijen the
workman comes for work.
Thus it will be seen that even on the
basis that a workman staying at a distance of five miles or more
comes for work for 30 days in a month, the allowance he ge~
is only a sum of Rs. 4.50 p under the Award.
In the circumstances mentioned above, it cannot be stated
that the award of the sum of 15 paise per day is in any manner
unreasonable or arbitrary.
The payment has also been hedged
in by the condition that the employer has to be satisfied that the
workman is staying at a place five miles and over from Atul
village and that it need not be paid on days when the workman is
either on earned leave or any type of leave authorised or otherwise.
Therefore, We are satisfied that the direction given by the
Tribunal under demand No. 4 in Civil Appeal No. 742 of 1968
and demand No. 6 in Civil Appeal No. 809 of 1968 is justified.
The Union in Civil Appeal No. 2086 of 1968 has asked for
enhanced rate of transport allowance being given to the Cmployee
in Atic Industries Ltd.
Its claim is that 80 paise has to be paid
to every workman per day or in the alternative the allowance .must
be, as directed by the Tribunal in Cynamid In<tia Ltd. All these
aspects have been discussed by the Tribunal when it fixed the
quantum in the case of Atic Industries Ltd. Though the Tribunal
cannot impose any new obligation on an employer merely on the
ground that the financial capacity of the employer is sound, nevertheless the Tribunal when imposing the new obligation has also
B
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ATIC INDUSTRIES v. WORKMEN (Vaidialingam, J.)
783
A
to consider the capacity of the employer to bear the burden. In
the case of Atic Industries Ltd. the Tribunal has held that it does
not want to cast additional financial burden and that is why it
has fixed the allowance at a very reduced scale. We see no error
in this reasoning of the Tribunal and as such Civil Appeal No.
208 6 will have to be dismissed.
B
In the result, the Awards of the Industrial Tribunal in respect
of demand No. 4 in Civil Appeal No. 7 42 of 1968 and demand
No. 6 in Civil Appeal No. 809 of 1968 are confirmed and both
the appeals are dismissed.
Civil Appeal No. 2086 of 1968 is
also dismissed.
Parties will bear their own costs
in .all the
C
,appeals.
G.C.
Appeal dismissed:.