# C · 855· POLYCHEM LIMITED v. R. D. TULPULE, INDUSTRIAL TRIBUNAL, BOMBA\ &. ANR - **Citation:** [1972] 3 S.C.R. 855 - **Court:** Supreme Court of India - **Decided:** 1972 - **Bench:** C. A. Vaidial!Ngam, I. D. Dua, G. K. M!Tter - **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/c-855-polychem-limited-v-r-d-tulpule-industrial-tribunal-bomba-anr-5621 - **Pages:** 10 ## Headnote Lt.buur Luw-Wage · policy~Fi.wtion uf (11/on·cmce-Principleli (() hi! con.ridert'CI. TI.•: dcm1nd for vacation allowanc..'C of the workmen of. the appcl-· !ants, at the same rate as was granted to the higher 3taff, was granted bv th~ lmlu~lrial Tribunal. Th= Tribunal uccid:d tt .. : question on the hasis that the appellant-employer had th~ fln-:ancial capaqty to stand the bur of ~uch allo...,an;::: l:dng grnntcd to the workmen at the rate claimed. Allowing the appeal ROd remanding the mutter to be considered afre~h by rkmcn· m the K":1ety. th::i~ ccmmitment to in:hJ5try, tl"•!ir ;•ttitude tOwards the manaj!C· m_:n_t. th~ir m0tivation towurds productivity. and their standard ~nd w~y -~: ,:,r:. ~rt "'· couditi uncJ by 111ac~·'· ~ ! is not :.1 pure!v econom1c pohc\' 1il 11 h:t., an ·~rTJ'llo yer <~nd 1111 employe<: olonc are entercst:d. but. •h:: . fon,umer and the wciety at large and t'! fortiori ,the State, ar~ al~ vttull)' :~11¢rc •t:J. No WUJF policy t:~n ever he upplicd in "acuum m drsrc~:ard f\( the r~ilitie~ or the &oeial and ~conomic condition' in our ~Un!rY C~:l\i.'krin' th~ qu~ tion or' wages In the b11ckgroun.l of th.: D•rcchv.: Prrncrpl~ 1n the Con~titution, a wage' ~tructure shou14 sl!l've to p_romotc II f,.,, r,·murl':r"rion to labour en~uring due: social dign•ty, personahty 1rnd \~~ •·:.a·. :1 lair rdurn to cupibl, 11nd sn-cngthen incentives to eff!c•:ncy~ . ...,nl':.- .tt 1-.:.:inr. unmindful or !he legitimate interests and e~pe_ctaho.n~ of rt,e c~n\Utr.r!T in tho: m~tttcr of prk:e•. Guided by th.s prmc•plc. •f. the fh •nc•~l c;~pacity ot 11n indu~try oermit• the ~~~rkmcn· m the K":1ety. th::i~ ccmmitment to in:hJ5try, tl"•!ir ;•ttitude tOwards the manaj!C· m_:n_t. th~ir m0tivation towurds productivity. and their standard ~nd w~y -~: ,:,r:. ~rt "'· couditi uncJ by 111ac~·'· ~ ! is not :.1 pure!v econom1c pohc\' 1il 11 h:t., an ·~rTJ'llo yer <~nd 1111 employe<: olonc are entercst:d. but. •h:: . fon,umer and the wciety at large and t'! fortiori ,the State, ar~ al~ vttull)' :~11¢rc •t:J. No WUJF policy t:~n ever he upplicd in "acuum m drsrc~:ard f\( the r~ilitie~ or the &oeial and ~conomic condition' in our ~Un!rY C~:l\i.'krin' th~ qu~ tion or' wages In the b11ckgroun.l of th.: D•rcchv.: Prrncrpl~ 1n the Con~titution, a wage' ~tructure shou14 sl!l've to p_romotc II f,.,, r,·murl':r"rion to labour en~uring due: social dign•ty, personahty 1rnd \~~ •·:.a·. :1 lair rdurn to cupibl, 11nd sn-cngthen incentives to eff!c•:ncy~ . ...,nl':.- .tt 1-.:.:inr. unmindful or !he legitimate interests and e~pe_ctaho.n~ of rt,e c~n\Utr.r!T in tho: m~tttcr of prk:e•. Guided by th.s prmc•plc. •f. the fh •nc•~l c;~pacity ot 11n indu~try oermit• the ~~~rtand p(>i.o~ raised in thes~ ~~ the de e lndu_,trial T . es to the v~hdity of that part VI. • lanu .;::d for vacation ~~~nal, Maharashtra, Bombay, by whiC~ fl ed to it~ fu~lychem Ltd ~ce of the workmen of th~ .WC:t· Staff both. at th hbay, at the same rato as" ~ut , e ead. otflce and at its Chlllll B c 0 F G II POLYCHEM L TO. V, INDUSTRIAL TRIBUNAL. (Dr 10, 1.) 857 plant, was allowe?. These two appeals are directed . impugned award In two references under s lO(l) (d~a~nst the · Industrial Disputes Act, 1947, one of which (Ref No 2~f4 the 1968) related to the demands of the head office staff and th of (Ref~ renee No. 19 of 1969) to the workmen of Chembure ~~~~ The impugned po rtion of the award dated June 9, 1970, reads as under : "The only nthc~ demand which is now common to both the rcfcr~nt·c~ ts th.: demand for the vacation allowance. It :1p1~cars t~at tlle company pays to its officers or other ~l.:.tll Jrawmg R.s. 60.0 an~ more as basic wage one months . ~;llary for vacat1on m case his leave e:<:ceeds 15 Jays and is not accumulable. The demand of the workm.:n is that the minimum should be Rs. 300 and the maximum Rs. 2,000. It is pointed out for the compan~ that this was rcfu~ed by the Tribunals in Burmah Shell and Voltas. The Union on the other hand contended that it was ollowed in the banks and rcfincrie~ t-y ~.:ttl<>ments though refused by the Tribun:~ls. Thre~fficers), uniforms and medical fac1htleS. Our attent1on was drawn to a prepared statement produced. before ws on ~half of the appellants for showing the dlffe~ence tn ~e ·pay packet of -workmen t'tnploy~d at the appt"llant s head office as a result of the award given in Reference N_o. IT 2~4/68. The respon~ent did not accept this statement saymg that It was. based on the Interpretation placed by the appellant to. ~~pport 1ts case. In r~gard to B . overtime allowance and other fac1httes referred to by Shn Gupte. 1he learned counsel relying, Inter alia, on another statement relating to facilities accorded ;o the workmen in 1970-71 produced before us, submitted that the workmen were getting numerous other benefits not available to officers. This submission was. C 'however, sought to be founded on material not on the court record. The learned counsel strongly contended that the real criterion should have been to look to the overall pay structure of the workmen in the light of the standard prevailing in similar industries in the same: r~gion.. Mere capacity of the appellant to pay should not be the sole criterion, he added. Reference wa; D made to the de~ision of this Court in Remington Rand of lna'ia Limited v. The Workmm( 1) where it was observed: - "A~ regards the first ground it is true that in th: present case there WOLYCHEM LTD. V. INDUSTRIAL TRIBUNAL (Dua, J.) 859 workmen including those· who work. at the offices it w'ould in fact mean a double provision for the constituent of the cost of food already proYideu for in the wage se..les and the rates of dearne5s allowance. The force of this aspect was recognised by this Court in Mcleon & Co. Ltd. v. Workmen( 1 )", lt was said on behalf of the respondents that in the case cited there was no discriminatory treatment in the same concern among the emplorees of different grades of salaries at the same place. t The requirements of providing lunch to· those who could not return to the office from outdoor work outside the c1ty limits, as was the fact in the cited case, according to the respondents, furnish a distinguishing feature in that case from the present. Next reliance was plac~d by Shri Gupte on the following observations in Alembic Chemical Works Co. Ltd., v. The Workmene) : "Then it is urged that the provision made by the award for privilege leave introduces discrimination· between the clerical staff covered by the present reference and operatives covered by the earlier awards made by the same Tribunal. We were told that operatives had made a similar claim for privilege. leave before the same Tribunal, and the said claim had been rejected.· The argument is that the provision for privilege leave made by the present award would create discontent ~ amongst the operatives to whom similar leave has been denied, and that would d1sturh industrial peace. We are not impressed by this argument. It is not seriously . disputed . that a distinction has generally been made between .operatives who do manual work and clerical 'and other sta!f; in fact the appellant's standing arden themselves make different relevant provisions for the two categories of its employees. It is also not disputed · that in practice .such distinction is made by comparable concerns,. and awards based on the same distinction arc ~~nerally made in respect of the two separate categoG n.es of employees. We are, therefore, unable to appre- . c1ate the argument that. in granting privilege leave to \ the .present staff the Tnbunal has either overlooked its e*fhe~ award .or ~~ m~de d. decision which suffers from tm v1ce of d1Scrurunat10n. . The· practice prevailing in comparable concerns and the trend of a\;Vards both seem to show that a ?istinction is generally made between t~e . tw~ ca~egones of ,employees, and since the said d~ttn~wn lS perfectly justifiable no question of discriH mtnanon can arise." · (1.) [1964] S S.C.R. 568, .S7i. (2). (1961] 3 S.C.R. 297 at 306; 860 SUPREME COURT REPORTS [1972] 3 S.C.R. According to the respondents the distinction between operatives A doing manual work and clerical and other staff may be justified but that is not the case here. Besides, in the reported case this Court, in its concluding part said, that it was not satisfied that any case for interference under Art. 136 had been made out whereas in the present case the appellan't wants this Court to interfere and reverse the impugned part of the award on the f.l ground that it is grossly erroneous and unjust. . Reference was then made on behalf of the appellant to the decision in Delhi Cloth & General Mills Co., Ltd., v. Workmen(!), emphasis being laid on the following passage at p. 327 : 4 "But in the branch of law relating to industrial relations the temptation to be. crusaders instead of adjudicators must be firmly resisted. It would not be out of place to remember the 9tatement of the law made in a different context-but ponetheless appropriate here-by Doughlas, J., of the Supreme Court of the -United States in United Steel Workers of America v. Enterpri8e Wheel and Car Corporation('-') : ' ...... as arbitrator .... does not sit to dispense his own brand of industrial justice. He may of course look for guidance from many sources, yet his award is legiti· mate only so long as it draws its essence from the collective bargaining agreement. When the arbitrator's words manifest an infidelity to this obligation, courts have no choice but to refuse enforcement of the award.' r We may at once state that we are not for a moment suggesting that the law of industrial relations developed in our country has proceeded on lines parallel to the direction of the law in the United States." f The respondent, on the other hand, laid more emphasis on the last portion of the above observations, submitting that the problems of our country in regard to labour welfare at the present stage of our industrial development, particularly in the background of our egalitarian socialistic pattern of society as visualised in oux:_SConstitution, are materially different from the labour problems ~uir ing solution in the developed American society under that cquntry's constitution. The following passage from pp. 326-3~7 from the D.C.M.'s case (I) is also worth quoting: ;.. "We consider it right to observe that in adjudication of industrial disputes settled legal principles. have little play : the awards made by industrial tribunals are often the result of ad hoc determ~nation of disputed questions, {1).[1969) 2 S.C.R. 307. (2). [1960] 363 U.S. 593. c D E G H A c D ·E G H POLYCHEM LTD, V, INDUSTRIAL TRIBUNAL (Dua, J,) 861 and each determination fonns a precedent for determination of other disputes. An attempt to search for pJinciple from the law built up on those ·precedents is a futile exercise. To the Courts accustomed to apply sett~ed principles to facts determined by the application of ·the judicial process, an essay into the unsurveyed expanses of the law of industrial relations with neither a compass nor a guide," but only the pillars of precedents is a disheartening experience. The Constitution has however invested this Court with power to sit in appeal over the awards of Industrial Tribunals which are, it is said, founded on the somewhat hazy background of · maintenance of industrial oeace, which secures the prosperity of. the industry and improvement of the conditions of workmen employed in the industry, and in the ·absence of principles precedents may hav& to be adopted guides-somewhat reluctantly. to secure some reasonable degree of uniformity of harmony in the process." In o~r view the ultimate object of industrial adjudication in our coun~ry is to help the growtP. and progress of national economy and for. realising that object the industrial disputes are settled on principles of fairplay .and justice, hannonising the conflicting claims of capital and labour with full awareness of the current of socio-economic trends of thought. Our industrial law, is therefore, expected to effectively secure to the workers conditions of service reasonably conducive to the improvement of their social and economic standard of living and their moral and material development. The existing pe<;uliar problems, relating to industrial labour in our country, having their roots in the historical back_.!O'ound .of our s~ial, economic and political conditions have little in common with the current labour problems of America or other developed countries. We must, therefore, guard ourselves against the •temptation of too readily and indiscriminately following ~e American line of thought. Shri Gupte next referred us to. the·decision"'in /. K. Iron &Steel Co. Ltd. v. The Iron & Steel Mazdoor. Union, Kanpur(l) relying on the following passag.~ at p. 1322 : "In Bharat Bah.k Lid. v. Employees of Bharat Bank Ltd.( 2 ), this Court held by a majority that. though these Tribunals are not Courts in the strict sense .of."the term they have to . discharge qua5i-judicial ftmctions and as s·uch ~re subject to .the overriding jurisdiction of this Court un.(ler article 136 of .the Constitution. Their powers are derived from the statute that creates~ them and·they h~ve to function within.tne limits 1rnposed·there (l). [19~,;1 2 S.C.R. 1315. . (2). (1950] S.C.R •.. S9, 497 9-Ll 061SupCij72 862 SUPREME COURT REPORTS [1972] 3 S.C.R. ' and to act according to its provisions. Those proviA sions invest them with many of the 'trappings' of a court and deprive them of arbitrary or absolute discretion and power. There is, in our opinion, an even deeper reason which is hinted at in the judgment of Mahaj.an · J., (as he then was) at page 500 where he says that 'benevolent despotism is foreign to a democratic ConstiB tution'. That, in our opinion, is the heart of the matter." To give relief to the workmen merely because the appellant can bear the financial burden is, according to Shri Gupte, it by these observations. According to the respondents, on the other hand, the observations relied upon leave to .be construed in their own context and so read they do not prohibit the industrial adjuqication from granting just and fair remuneration to the labour in lieu of its contribution to· the prosperity of the industry, provided the employer can, consistently with its own fair and just claim in lieu of its contribution to the prosperity of the industry and withou~ detriment to its maintenance and betterment, bear the financial burden. The respondents' learned counsel Shri Chaudhri drew our attention to the admitted fact that in the case of Burmah SheJl, Esso and Caltex Refineries vacation allowance (which was consideJed to be identical with travelling allowance) was granted to the workmen by way of settlement and submitted that those industries, though different being refineries, are in the same region and the general standard of remuneration of workme.n in that region performing similar duties and functions should not be materially di-fferent. The fact that those in'dustries granted such allowance by settlement shows that such a demand by the workmen has not been considered by those industries to be unjust or unacceptable. Harmonious standardisation of wage:; in a region in the absence of marked difference in the character of the duties and functions of labour, according to the respondents: reduces the factors contributing discontentment and ·promotes the chancys of the workers' commitment to the industry whereas unjustified differential tr~at ment tends to serve as a potential source of industrial unrest. Shri Chaudhri also referred us to the decision in Express Newspapers (P) Ltd. v. Union of India(l) where at p. 81 it is observed: "It ~ill be seen from this summary of the concepts of the living wage held in various parts of the world that there is general agreement that the living wage shou.ld enable the male earner to provide for himself and his family not merely the bare es~entials of food, clothing and shelter but a measure of fru_gal comfort including education for the children, protection against ill-health, (1). [19S9] S.C.R. 12. c I> G H POLYCHEM LTD. v. INDUSTRIAL TRIBUNAL (Dua, }. ) 8 63 A r~uirements of essential social needs, and a measure of insurance against the more important misfortunes in6 c 0 E F G H cluding old age. · Article 43 of our Constitution has also adopted as one of tht Directive Principles of State Policy that : 'The State shall endeavour to secure, by suitable legislation or economic organisation or in any other way, to all workers, agricultural, industrial or otherwise, work, a living wage, conditions of work ensuring a decent standard of life and full enjqyment of leisure and social and cultural opportunities .... ' ' This is the ideal to which our social welfare State has to approximate in an attempt to ameliorate the living conditions of the workers." Shri Gupte, however, emphasised that in India living wage on standard prevalent in more advanced countries is not possible in the present level of our national i~come. Wage poliey relating to workmen appears to be a complex and sensitive area of public policy. The reason is. plain. The relative status of workmen in the society, their commitment to . industry and their attitude towards the management, their motivation towards productivity and their standard and way of life; are all conditioned by wages. It is accordingly not a purely economic policy in which the employer and the employee alone are interested. Besides the worker a!ld the management, the consumer and the society at large and a fortiori the State, are also vitally interested, and no wage policy can ever be applied in vacuum in disregard of the realities of the social and economic conditions in our country. Considering the question of wages in the back· ground of the Directive Principles enshrined in our Constitution a wage structure. should serve to promote, a fair remuneration to labour ensuring due social dignity, personality and security, a fair re.tum to capital, and strengthen incentives to efficiency, without being -yfunindful of the legitimate interest and expectation of the consumer in the matter of prices. Guided by this principle, if the financial capacity of the industry permits, the workers should, broadly speaking, be allowed their due share in the prosperity of the industry, to which they have contributed by their labour so as to enable them, within reasonable limits, to improve their standard of living. Turning now to the facts of the present case we are clearly of the view that the Tribunal has committed a serious error in not considering the other allowances and amf'nities allowed to the 864 SUPREME COU.ItT REPORTS {1972] 3 S.C.R. orkmen and comparing their total wage packet with A. respondents-w . ket' of those ~o;yees to whom the allowance the total wage pac · d · · · this · . ue:;tion has been allowed, when etenru~ . question. w q Tribunal has virtually decide:d the question ~ ISsue e_xclusi- ~e on the bruris that rttt employer h~ the finanaal -capaatf to st~d the burden of such aUowance ~rng granted to thl? yrorksnen t th same rate as the higher staff, 'Wlth the same conditions. The ~ffe:encc between the. amenities allowed t~ the workme ~ ~d to the staff to whom the vaca·uon allowan'7 lS granted. must 111 law and justice be looked into and the question then dectded whether or not the present workmen's demand is justified: ~e principle of region-cum-industry bas no doubt to be kept tn· vtew but then the comparable industries in the region have to be considered from C all the relevant aspects which have ~n laid down by this Court in various decisions to which it is unnecessary to refer, the .prind· pie being well settled. . The fact that in the re.fineries ·in the region similar allowance is granted as a result of settlement cannot, on that account alone, be ~nsidered to be irrelevant · because that may appropriately indicate that the demand of the workmen in those industries was not considcied:wijust .. ·But to :what extent Jl that should weigh with the l:.ribunal is for the Tribunal to decide in the light of all the relevant circurnstan~. The total wage i packet of ~e various categories of employees in the . appellant's j industty itself, including the question·of their nature of duties and i functions, ·hOwever, deserves to be given .primary importam:e · so j. that the~e ~IS ·no reusonable Chanee of .heart.:burning and discontenh 1 ment. amo~t the different .categories :of wotkmen an ..aceoWlt of 1· the differential tr~a~me:nt .which. though seemingly justifia•le. may; 1, in real e!fec.t. be diSCtlnUnatory. The importance of appropriate J stan~ard~uon of wag~ in the appellant-ind.u,my ori · a proper C?n.qtderauon of the dut1es and functions ot the different . categoi n.es of -employees ttlust ·be kept in 'View in deciding: the presont 1 l dispute. • l We ~ould accordingly allow the appeals, set aside.' the awa!d ~~ ~~ th:r case ba?lc t? the Tribunal with a direction .. to decide 1n the pec.uJia~r ~tde.ring all the· relevant factors. as . s~teJ. Costs, . ClrtWllStances of the . case there is DO order as to V.P.S. 0 '!