# Dr. N. B. Khare v. Election Commission of India

- **Citation:** [1958] 1 S.C.R. 651
- **Court:** Supreme Court of India
- **Decided:** 1955-07-11
- **Case number:** Civil Appeal No. 235 of 1956
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/dr-n-b-khare-v-election-commission-of-india-1410
- **Pages:** 16

## Headnote

S.C.R.
SUPR~E COURT REPORTS
651
And finally it is contended that the petitioner has
a right as a citizen to approach this Court under Art.
71(1) whenever an election has been held in breach of
the constitutional provisions. For the re~sons already
given, this contention must fail. The right of a person
to file an application for setting aside an election must
be determined by the statute which gives it, and that
statute is Act XXXI of 1952 passed under Art. 71(3).
The petitioner must strictly bring himself within the
four corners of that statute and has no rights apart
from it. The order appealed against is clearly right
and this appeal is dismissed.
Petition dismissed.
MESSRS. CROWN ALUMINIUM WORKS
'V.
THEIR WORKMEN.
(BHAGWATI, S. K. DAS and GAJENDRAGADKAR, JJ.~
Industrial Dispute-Adjudication-Constitution of wage structure-Revision of such structure, if can be made to the prejudice of
workmen-Convention-Governing principle.
Although there can be no rigid and inexorable convention
that a wage structure once fixed can never be changed to the
prejudice ·of the workmen, there are well-recognised principles on
which such revision must be founded, one important principle,
to which there can be no exceptions, is that the wages of workmen
cannot be allowed to fall below the bare subsistence level. Itfollows, therefore, that no industry can have the right to exist if
it cannot be maintained except by bringing the wages below that
level.
The Constitution of J ndia seeks to create a democratic
welfare state and secure social and economic justice to the citizens.
Growth of industries and the advent
of collective bargaining
between organized labour and capital with consequent industrial
legislation have made absolute
freedom of contract and thedoctrine of laissez faire things of the past and they have now to
yield place to principles of social welfare and common good.
Industrial adjudication has, thus, to keep in view the ideal of a
democratic welfare state and its immediate objectiye in constituting a wage structure must be to secure the genuine and wholehearted co-operation between labour and capital in the task of
production by a just adjustment of their conflicting interests by
1957
Dr. N. B. Khare
v.
Election
Commission
of India
Venkatarama
Aiyar, J.
1957
October, 15.
652
SUPREME COURT REPORTS
[1958)
1957
the application of several principles such as for instance the
principles of comparable wages. the productivity of the trade or
Messrs. Crown industry, cost of living and.ability of the industry to pay.
Alununuan Works
v.
In a case where the \vagc structure is of a higher category, it
Their Workn1en is open to the employer to claim its revision provided he can
satisfy the Tribunal that such revision is reasonable on
the
merits and fair and just to t.he parties.
Where, however, the employer's
financial
difficulties are
sought to be made a ground for such revision, the Tribunal has to
decide whether such difficulties could or could not be adequately
met by such retrenchment in personnel as has already been effected
by the employer and sanctioned by the Tribunal.
Consequently, in case where the Indistrial Tribunal fixed the
wage structure and the dearness allowance but gave the employer
liberty to abolish the two hours' concessions, facility bonus and
the food concession, holding them to be in the nature of bounty
gratuitously paid to the workmen by the employer,
and the
Labour Appellate Tribunal took the view that these concessions,
which had been enjoyed by the workmen for a pretty long time as of
right and as part of their basic wages and dearness allowance, had
become a term of the conditions of their service, and revised the
wage structure in respect of existing workmen by incorporating
the concessions into their basic wages and dearness allowance and
in doing so relied not merely on the convention that the existing
emoluments of workmen should not be reduced to their prejudice
but also on other considerations which were neither

## Text

S.C.R.
SUPR~E COURT REPORTS
651
And finally it is contended that the petitioner has
a right as a citizen to approach this Court under Art.
71(1) whenever an election has been held in breach of
the constitutional provisions. For the re~sons already
given, this contention must fail. The right of a person
to file an application for setting aside an election must
be determined by the statute which gives it, and that
statute is Act XXXI of 1952 passed under Art. 71(3).
The petitioner must strictly bring himself within the
four corners of that statute and has no rights apart
from it. The order appealed against is clearly right
and this appeal is dismissed.
Petition dismissed.
MESSRS. CROWN ALUMINIUM WORKS
'V.
THEIR WORKMEN.
(BHAGWATI, S. K. DAS and GAJENDRAGADKAR, JJ.~
Industrial Dispute-Adjudication-Constitution of wage structure-Revision of such structure, if can be made to the prejudice of
workmen-Convention-Governing principle.
Although there can be no rigid and inexorable convention
that a wage structure once fixed can never be changed to the
prejudice ·of the workmen, there are well-recognised principles on
which such revision must be founded, one important principle,
to which there can be no exceptions, is that the wages of workmen
cannot be allowed to fall below the bare subsistence level. Itfollows, therefore, that no industry can have the right to exist if
it cannot be maintained except by bringing the wages below that
level.
The Constitution of J ndia seeks to create a democratic
welfare state and secure social and economic justice to the citizens.
Growth of industries and the advent
of collective bargaining
between organized labour and capital with consequent industrial
legislation have made absolute
freedom of contract and thedoctrine of laissez faire things of the past and they have now to
yield place to principles of social welfare and common good.
Industrial adjudication has, thus, to keep in view the ideal of a
democratic welfare state and its immediate objectiye in constituting a wage structure must be to secure the genuine and wholehearted co-operation between labour and capital in the task of
production by a just adjustment of their conflicting interests by
1957
Dr. N. B. Khare
v.
Election
Commission
of India
Venkatarama
Aiyar, J.
1957
October, 15.
652
SUPREME COURT REPORTS
[1958)
1957
the application of several principles such as for instance the
principles of comparable wages. the productivity of the trade or
Messrs. Crown industry, cost of living and.ability of the industry to pay.
Alununuan Works
v.
In a case where the \vagc structure is of a higher category, it
Their Workn1en is open to the employer to claim its revision provided he can
satisfy the Tribunal that such revision is reasonable on
the
merits and fair and just to t.he parties.
Where, however, the employer's
financial
difficulties are
sought to be made a ground for such revision, the Tribunal has to
decide whether such difficulties could or could not be adequately
met by such retrenchment in personnel as has already been effected
by the employer and sanctioned by the Tribunal.
Consequently, in case where the Indistrial Tribunal fixed the
wage structure and the dearness allowance but gave the employer
liberty to abolish the two hours' concessions, facility bonus and
the food concession, holding them to be in the nature of bounty
gratuitously paid to the workmen by the employer,
and the
Labour Appellate Tribunal took the view that these concessions,
which had been enjoyed by the workmen for a pretty long time as of
right and as part of their basic wages and dearness allowance, had
become a term of the conditions of their service, and revised the
wage structure in respect of existing workmen by incorporating
the concessions into their basic wages and dearness allowance and
in doing so relied not merely on the convention that the existing
emoluments of workmen should not be reduced to their prejudice
but also on other considerations which were neither invalid nor
unwarranted by the evidence, its decision was ·valid in law.
Held, further, that this court would be normally reluctant to
entertain an objection
that any consideration
on \vhich
the
Appellate Tribunal had relied was either invalid or unwarranted
by the evidence on record. Where it finds that certain payments
\Vere in fact not gratuitous but were in substance part of the
wages and dearness allo\vancc, its decision is not liable to be set
aside.
CIVIL APPELLATE JURISDICTION: Civil Appeal No.
235 of 1956.
• Appeal by special leave from the judgment and
order dated the 29th July, 1955, of the Labour Appellate Tribunal of India, Calcutta, in Appeal No. Cal. 182
of 1953.
B. Sen. S. N. Mukherjee and B. N. Ghosh for the
appellant.
N. C. Chatterjee, D. I.. Sen Gupta and Dipak Datta
Chaudhury, for the respondent.
" .._
S.C.R.
SUPREME COURT REPORTS
653
1957
1957. October 15. The following Judgment of the
Court was delivered by
Messr.i. Crown
GAJENDRAGADKAR J.-This appeal by special leave Aluminium Works
v.
arises out of an industrial dispute between the appelTheir workme11
lant M/s. Crown Aluminium Works, Belur, represented by Jeewanlal (1929) Ltd., and its Workmen repre- Gajendragaclkar,J.
sented by Bengal Aluminium Workers' Union. By
their order dated July 31, 1952, the Government of
West Bengal referred thirteen matters for adjudication to Shri S. K. Niyogi who was appointed to constitute the Sixth Industrial Tribunal for adjudication
under s. 10 of the Industrial Disputes Act, 1947. The
learned adjudicator considered the pleas raised, and
the evidence led, by the parties before him, investigated into the financial position of the appellant and pronounced his award on October 9, 1953, on all matters
referred to him. Both parties were aggrieved by the
award and that led to two cross appeals. On July 11,
1955, the Labour ·Appellate Tribunal disposed of these
appeals by a consolidated order. The workmen appear to be satisfied with this order but the appellant
is not and so the present appeal. The main grievance
which Mr. Sen has made before us on behalf of the
appellant is in respect of the revision made by the
Appellate Tribunal.in the wage structure which wa.s
constituted by the original tribunal. Thus, the controversy br::t ween the parties in the present appP.al
lies within a very narrow compass; nevertheless, it
would be necessary to mention the history of the
dispute in some detail in order to appreciate properly
the points at issue between them.
It appears that in 1947, the first Omnibus Engineering Tribunal was constituted to adjudicate upon the
industrial disputes for the engineering industry in
West Bengal an.cl the matters referred to the tribuniil
included inter alia disputes in regard to basic wages,
dearness allowance and leave.
This tribunal gave
a comprehensive award which was published on June
30, 1948. The appellant was a party to these adjudication proceedings and was governed by the said
award. Soon thereafter industrial disputes again
arose between the engineering industry and its
employees and these were referred to another
654
SUPREME COURT REPORTS
[1958}
1957
tribunal
which
in due
course
examined
the
Messrs. Crow/I disputes and pronounced its award.
This award
Aluminium Works was
published
on
September
21,
1950.
By
v.
this award the dearness allowance fixed by the first
Their Workmen tribunal was increased on the ground of rise in the
Gajend~ , J. cost of living index and the leave rules prescribed by
0
'
the earlier award were modified in the light of the provisions of the Indian Factories Act, 1948. After the
first award had come into force the appellant revised
its facility bonus from time to time with the object
of keeping pace with the rise in the cost of living
index. The result was that several components which
constituted the wage structure paid by the appellant
to his workmen left no cause for grievance to the workmen. So they did not raise any dispute for increase
in their dearness allowance and the appellant and its
workmen were not parties to the second arbitration
proceedings. Meanwhile, a minor industrial dispute
arose between the appellant and its workmen and it
was referred to the arbitration of Shri G. Palit by the
Government of West Bengal by tll.eir order dated
November 24, 1950.
One of the points referred to
the Tribunal was in regard to the amount of increment
which should be granted to workers in 1950 and the
date from which it should be so granted. 'The appellant denied its liability to pay the increment on the
ground that there was no wage structure which permitted such a claim. The appellant also urged before
Shri Palit that its workers were on the whole handsomely remunerated. In this connection relian~e was
placed by the appellant on the payments made by the
appellant to its workmen by way of special allowance
and bonus, besides dearness allowance and standard
wages. It would thus appear that the appellant
resisted the claim of its workmen for the increment in
wages on the ground that in the wage structure of the
appellant additional components had been introduced
which made ample provision for the rise in the cost
of living. Shri. Palit was, however, not impressed
with this plea. He thought that by introducing these
components in the wage structure the Managing
Director "chose to hold the key in his own hands so
S.C.R.
SUPREME COURT REPORTS
655
that he can manipulate the quantum of benefit under
· 1951
this head and could adjust it to the output in the facMessrs. O:owtt
tory". Shri Palit, therefore, granted the workmen's Aluminium Works
demands· by allowing one anna per ~ increment
. v.
.
though he frankly confessed that this was not based Their Workmen.
on any actual calculation. He accordingly, directed Gojendragadka~. J.
the appellant to pay the arrears within one month of
the award coming into operation to all workmen who
were in the roll of the appellant at the end of 1950.
Then Shri Palit addressed a word of caution to the
appellant and said that it was necessary that the appellant should fix a wage structure as soon as practicable
to secure durable peace in the factory. "It will be prudent", observed Shri Palit in his award, "for the company to have a hide bound wage structure instead of
having so many flexible component parts of the wage
which merely will create unrest". This in brief is;
the previous history of the dispute between the appellant and its workmen.
On March 28, 1952, the appellant issued a notice
to its workmen proposing to make certain modifications. The notice indicated that a reduction of the
factory hours from 47 to 40 would be made, the facility bonus would be reduced by 3 as. per day and
temporary dearness allowance for the salaried workers
would be similarly reduced by 10% of the then current rates. The appellant pleaded in this notice that
these economy measures had become necessary owing
to the financial set-back of the appellant. and would
come into effect on June 1, 1952. The Union opposed
these changes. A joint discussion was then arranged
on June 2 and June 26, 1952. It appears that further
economy measures were introduced for discussion
between the parties by the notice dated May 30, 1952.
These further economy measures related to the reduction of the facility bonus by a further amount of 6 as.
per day, withdrawal of two hours' concession of special
bonus ·and discharge of workers of the rolling mills
department. The Union did not agree to any of these
measures except the reduction of working hours from
47 to 42! hours a week. Since joint consultations did
not lead to any agreement, the appellant, by its notice
656
SUPREME COURT REPORTS
(1958]
1957
dated June 27, 1952, intimated to the workers that the
Messrs. Crown reduction of working hours and in the facility bonus
Aluminium Worksand dearness allowance as notified on March 28, 1952,
v.
would be brought into operation from June 1, 1952.
Their Workmen The workers were also told that the two hours' con-
.Gujeiulragadkar J. cession would be withdrawn from July 1, 1952, and
' the workers in the rolling mills department would be
discharged with effect from August 1, 1952. The
workmen resisted these proposals and took the industrial dispute arising therefrom to the Labour Commissioner immediately. Thereafter a joint conference
of the appellant and its workmen was held on July 4,
1952. The int~rvention of the Labour Commissioner
was not effective as the proposals made by him to
resolve the dispute between the parties amicably were
not acceptable to the parties. The appellant thereupon
discharged the workmen of the rolling mills department, 52 in number, with 14 days' notice pay and retrenched other 227 workers of various categories as
from July 26, 1952, with a similar notice pay. The
Government of West Bengal found that conciliation
was not possible and so the industrial dispute in question was referred to the Sixth Industrial Tribunal for
adjudication.
As we are concerned in the present appeal only
with the constitution of the wage structure and some
questions incidental thereto we will now refer to the .
decisions of the lower tribunals only in respect of these
matters. The Sixth· Industrial Tribunal considered
the financial position of the appellant and revised and
reconstituted the wage structure and the dearness
allowance in the light of the Omnibus Engineering
Awards in West Bengal published in 1948 and 1950.
The tribunn.l held that the two hours' concession,
facility bonus and the food concession were in the
nature of bounty gratuitously paid by the appellant
and as such thElY could be withdrawn by the appellant at its pleasure. The tribunal also came to the
conclusion that since the wage structure had been
revised and reconstituted properly, the appellant
should be given liberty to abolish the said three concessional payments. It may be relevant to observe
S.C.R.
SUPREME COURT REPORTS
657
that the tribunal's conclusion in regard to the
1957
character of the alleged concessional payments· was
Messrs. crow11
based principally on the view that in his award Aluminium Works
Shri Palit had held that these payments were purely
v.
concessional payments and that the workmen had no Their Workmen
right to claim them as constituents of their wage Gafenclragadkar;1,
structure.
The Labour Appellate Tribunal has not agreed with
this conclusion. The view that the Appellate Tribunal has taken is that these so-called concessional payments have been enjoyed by the workmen for a pretty
long time as of right and as part of their basic wages
and dearness allowance and as such they have become
a term of the conditions of their service. Besides, the
appellate tribunal has observed that it has been the
convention with industrial tribunals not to reduce the
existing emoluments of the workmen to their prejudice. In the result the wage structure constituted
by
the tribunal was modified by the .award of the
appellate tribunal in respect of existing workm.en.
The main conditions introduced by these modifications
were three:
"l. The total basic wages of a time-rated worker
together with the two hours' concession immediately
before 1-6-'52 shall hereinafter be called his existing
basic wage.
.
2. The total of the temporary dearness allowance
and the facility bonus as was available to a worker
prior to 1-6-'52 and the food concession wherever
admissible to a worker under the rules of the company
shall hereinafter be called his existing dearness allowance, no matte~ i~ any portion of these benefits has
been curtailed or stopped in the meantime.
3. The two hours' concession, the facility bonus
and the food concession shall cease to have any separate existence distinct from the basic wages and dearness allowance of the worker on and from the date
when this decision comes into force, hereinafter called
the relevant date."
Both the original and the appellate tribunals have
agreed in providing that the. existing basic wages and
the existing total emoluments shall not be reduced.
L2SC/6t-S
658
SUPREME COURT REPORTS
[1958]
1957
F.or the appellant Mr. Sen has contended that the
Messrs. Crown Labour Appellate Tribunal was in error in assuming
Aluminium works' that it has been the convention in industrial adjudicav.
tions not to reduce the existing emoluments of the
Their workmen workmen to their prejudice in any case. He contends
Ga) di -
dka 1 that just as the rise in the cost of living index or simi-
•• raga
'· · • lar relevant factors may justify the revision of the
wage structure in favour of the workmen, so should the
revision of the wage structure be permissible in
favour of the employer in case the financial position
of the employer has considerably deteriorated or
other relevant factors indicate such a revision. Indeed
Mr. Sen made it clear during the course of his arguments that in the present appeal he was more concerned to challenge the validity of the assumption
made by the Labour Appellate Tribunal in that behalf,
rather than the propriety or correctness of the actual
modifications made by the Appellate Tribunal in its
award. The point thus raised by Mr. Sen is no doubt
of general importance and it must be considered in
all its aspects.
Before dealing with this point, it would be relevant to refer to the findings made by both the tribunals
in regard to the financial position of the appellant.
The present unit of the aluminium industry which
was originally started by the Americans was taken
over by the appellant from the Americans on August
9, 1951. The main business of the appellant is to
manufacture household utensils from aluminium circles. These circles were imported until the last war.
During the war, import of these articles became difficult and so a rolling mills department for manufacturing ·circles from scrap materials was started. It is
true that utensils made from such circles were inferior
in quality; but import difficulties were insurmountable
and so even these inferior utensils found a good market. As soon, however, as better quality circles became available the demand for these utensils rapidly
decreased and the business began to incur loss. The
management was thus compelled to close down the
rolling mills permanently in February, 1952. As we
have already mentioned, the workmen employed in
S.C.R.
SUPREME COURT REPORTS
659
19S7
the rolling mills were ultimately discharged on July
15, 1952.
· Messrs. Crown
Al11minJHm Works
The appellant placed before the tribunals below the
v.
relevant figures from the statements of accounts from Their Workmen
1947 . to September 1952. Both the tribunals have Ga"endr-;;dkor. J.
examined these figures and have .::ome to the conclu-
~
g
·
sion that the economic position of the appellant on
the whole was none too bright. Fall in the sale of
utensils was noticeable during these years and if the
utensils were not disposed of in the market quickly
they are likely to lose their lustre and glaze and would
be even stained if they were to be stored in the godown
for any length of time. This in turn would involve
extra expenditure and would contribute to further
losses. It appears to be the concurrent finding of both
the tribunals that the manufacturing cost in 1952, as in
some preceding years, exceeded the sale price and this
undoubtedly would be a disquieting feature in any
industrial concern. The original tribunal did not see
any prospect of improvement in the appellant's financial position; whereas the Appellate Tribunal was
disposed to take the view that as a result of the substantial retrenchment effected by the appellant "finanCial position of the relevant unit of the aluminium
industry appears to have improved". It is in the
background of these findings that Mr. Sen has contended that the wage structure constituted by the
Appellate Tribunal would work a hardship on the
appellant and his grievance is that in reconstituting
the wage structure the Appellate Tribunal was very
much influenced by the assumption that the wage
structure can never be revised to the prejudice of
workmen.
In dealing with this question, it is essential to bear
in mind the main objectives which industrial adjudication in a modern democratic welfare state inevitably
keeps in view in fixing wage structures. "It is well
known" observes Sir Frank Tillyard, "that· English
Common Law still regards the wage bargain as a contract between an individual employer and an individual worker, and that the general policy of the law
has been and is to leave to the two contracting parties
660
SUPREME COURT REPORTS
(1958]
19$7
a general liberty of bargaining, so long as there are no
Messrs. CTDWn terms against public policy" (1). In India as well as
Aluminium Works in England and other democratic welfare states great
rn.e· ,!; """ inroad has been made on this view of the Common
"~ • Law by labour welfare legislation such as the MiniGajendtagadkar, J. mum Wages Act and the Industrial Disputes Act.
With the emergence of the concept of a welfare state,
collective bargaining between trade unions and capital has come into its own and has received statutory
recognition; the state is no longer content to play the
part of a passive onlooker in an industrial dispute.
The old principle of the absolute freedom of contract
and the doctrine of laissez faire have.yielded place to
new principles of social welfare and common good.
Labour natilrally looks upon the constitution of wage
structures as affording "a bulwark against the dangers
of a depression, safeguard against unfair methods of
competition between employers and a guarantee of
wages necessary for the minimum requirements of
employees"(°). There can be no doubt that in fixing
wage structures in different industries, industrial
adjudication attempts, gradually and by stages though
it may be, to attain the principal objective of a welfare state, to secure "to all citizens justice, social and.
economic". To the attainment of this ideal the Indian
Constitution has given a place of pride and that is the
basis of the new guiding principles of social welfare
and common good to which we have just referred.
Though social and economic justice is the ultimate
ideal of industrial adjudication, its immediate objective in an industrial dispute as to the wage structure
is to settle the dispute by constituting such a wage
structure as would do justice to the interests of both
labour and capital, would establish harmony between
them and lead to their genuine and wholehearted cooperation in the task of production. It is obvious that
co-operation between capital and labour would lead
to more production and that naturally helps national
economy and progress. In achieving this immediate
(i) ''The Worker and the State" by Sir Frank Tillyard, 3rd Ed., p. 97.
(•) "Wege Hour Law" Coverage-By Herman A. Wccht, p. o.
S.C.R.
SUPREME COURT REPORTS
661
objective, industrial adjudication takes into account
I9S7
several principles such as, for instance, the principle
u
s c
. .
messr .
ruw1r
of comparable wages, productivity of the trade or Aluml1rium works
industry, cost of living and ability of the industry to
v.
pay. The application of these and other relevant Their Workmen
principles leads to the constitution of different cate- G . ,,-dk
1
.
f
Th
.
u)enuraga ·or, •
gories o wage structures.
ese categories are sometimes described as living wage, fair wage and minimum wage. These terms, or their variants, the comfort or decency level, the subsistence level and the
poverty or the floor level, cannot and do not mean
the same thing in all countries nor even in different
industries in the same country. It is very difficult to
define or even to describe accurately the content of
these different concepts. In the case of an expanding
national economy the contents of these expressions
are also apt to expand and vary. What may be a fair
wage in a particular industry in one country may be
a living wage in the same industry in another country.
Similarly, what may be a fair wage in a given industry
today may cease to be fair and may border on the
minimum wage in future. Industrial adjudication has
naturally to apply carefully the relevant principles of
wage structure and decide every industrial dispute so
as to do justice to both labour and capital. In deciding
industrial disputes in regard to wage structure, one of
the primary objectives is and has to be the restoration
of peace and goodwill in the industry itself on a fair
and just basis· to be determined in the light of all
relevant considerations. There is, however, one
principle which admits of no exceptions. No industry
has a right t-0 exist unless it is able to pay its workmen at least a bare minimum wage. It is quite likely
that in under-developed countries, where unemployment prevails on a very large scale, unorganised labour
may be available Qn starvation wages; but the employment of labour on starvation wages cannot be
encouraged or favoured in a modern democratic welfare state. If an employer cannot maintain his enterprise without cutting down the wages of his employees
below even a bare subsistence or minimum wage, he
would have no right to conduct his enterprise on such
662
SUPREME COURT REPORTS
[1958]
1957
terms. In considering the pros and cons of the arguM
C
ment urged before us by Mr. Sen, this position must
essrs.
rown be b
.
. d
Aluminium Workl'
Orne lO mm '
v.
Their Workmen
The question posed before us by Mr. Sen is : Can
-
the wage structure fixed in a given industry be never
Gajenc/ragadkar, 1· revised to the prejudice of its workmen ? Considered
as a general question in the abstract it must be answered in favour of Mr. Sen. We do not think it would
be correct to say that in no conceivable circumstances
can the wage structure be revised to the prejudice of
workmen. When we make this observation, we must
add that even theoretically no wage structure can or
should be revised to the prejudice of workmen if the
structure in question falls in the category of the bare
subsistence or the minimum wage. If the wage struc-
. ture in question falls io a higher category, then it
would be open to the employer to claim its revision
even to the prejudice of the workmen provided a case
for such revision is made out on the merits to the satisfaction of the tribunal. In dealing with a claim for
such revision, the tribunal may have to consider, as
in the present case whether the employer's financial
difficulties could not be adequately met by retrenchment in personnel already effected by the employer
and sanctioned by the tribunal. The tribunal may also
enquire whether the financial difficulties facing the
employer are likely to be of a short duration or are
going to face the employer for a fairly long time. It
is not necessary, and would indeed be very difficult,
to state exhaustively all considerations which may be
relevant in a given case. It would, however, be enough
to observe that, after considering all the relevant facts,
if the tribunal is satisfied that a case for reduction in
the wage structure has been established then it would
be open to the tribunal to accede to the request of the
employer to make appropriate reduction in the wage
structure, subject to such conditions as to time or
otherwise that the tribunal may deem fit or expedient
to impose. The tribunal must also keep in mind some
important practical considerations. Substantial reduction in the wage structure is likely to lea.d to dis-
S.C.R.
SUPREME COURT REPORTS
663
content among workmen and may result in disbar1957
mony between the employer and his employees; and Mess;,crown
that would never be for the benefit of the industry as Aluminium Works
a whole. On the other. hand, in asses1:11ng the value
v.
or importance of possible discontent amongst workTheir Workmen
men resulting from the reduction of wages, industrial Gafendragadkar, J.
tribunals will also have to take into account the fact
thatif any industry is burdened with a wage structure
beyond its financial capacity, its very existence may
be in jeopardy and that would ultimately lead to unemployment. It is thus clear that in all such cases all
relevant considerations have to be carefully weighed
and an attempt has to be made in each case to reach
a conclusion which would be reasonable on the merits
and would be fair and just to both the parties. It
would be interesting to notice in this connection that
all the tribunals that have dealt with the present dispute have consistently directed that existing wages
should not be reduced to the prejudice of the workmen. In other words, though each tribunal attempted to constitute a wage structure in the light of materials funiished to it, a saving clause has been added
every time protecting the interests of such workmen
as were drawing higher wages before. Eeven so, it
would not be right to hold that there is a rigid and
inexorable convention that the wage structure once
fixed by industrial tribunals can never be changed to
the prejudice of workmen. In our opinion, therefore,
the point raised by Mr. Sen must be answered in his
favour subject to such relevant considerations and
limitations as we have briefly indicated.
Mr. Sen is, however, not right in contending that
the final decision of the Appellate Tribunal is based
solely or even chiefly on the alleged convention to
which the Appellate Tribunal has referred. As we
have already pointed out, the tribunal has also found
that substantial retrenchment which has been sanctioned by both the tribunals would improve the financial position of the appellant. In the opinion of the
Appellate Tribunal, the downward tendency in the
cost of living index on which the appellant partly
relied could not be considered in the present.proceedings since no specific issue had been referred to the
664
SUPREME COURT REPORTS
[1958}
1957
tribunal in that behalf. Besides, enough material had
Messrs. C.·ow11 not been produced to show to what extent the cost of
Aluminium Works l' ·
· d
h d f 11
d h h
h' f Jl
v.
1vmg m ex a
a en an w et er t 1s a was temTheir Work111e11 porary or had come to stay. The Appellate Tribunal,
Gajendragadkar,J. it appears, thought that the wages paid by the appellant to its workmen "are the irreducible minimum or
may at best be in the region of fair wages with a small
margin over the minimum wage." If, in reaching its
final conclusions, the Appellate Tribunal has relied not
only upon the alleged convention but also upon the
other circumstances just mentioned, it would not be
fair to say that its conclusion is vitiated in law or is
otherwise unsound. Normally, this court would be
slow to entertain an objection that some of the considerations which have weighed with the Appellate
Tribunal in reaching its final decision are either in valid
or are not borne out by sufficient evidence on record.
There is another point which Mr. Sen has raised
before us in regard to the true character of the concessional payments made by the appellant to its workmen and which have been incorporated by the Appellate Tribunal in the wage structure. The Appellate
Tribunal has taken the view that these concessional
payments really amounted to payments made to the
workmen as a matter of right and it is the correctness
of this conclusion that is challenged before us by Mr.
Sen. Let us then consider the genesis of these payments. Prior to the new Factories Act, the appellant's
workmen worked on an average for 59 hours of work
made up of the usual 54 hours of work and overtime.
After the Factories Act came into force, the working
hours had to be reduced but in order to compensate
the time-rate workers for reduction in· their wages,
the management added to the daily earnings of such
workers the wages for two hours. The additional two
hours' wages thus awarded to the workers came to be
known as two hours' concession or special bonus.
This bonus was introduced in August, 1946. In April,
1945, facility bonus had been introduced at 3 as. per
day for workers getting basic wages equal to or less
than 10 as. per day and 4 as. per day for workers whose
basic wages were over 10 as. per day. It appears that
S.C.R.
SUPREME COURT REPOR'l'S
665
1957
this facility bonus was revised from time to time in
the upward direction, and it used to be paid prior to Messl's. Crowi:
June 1952 at a graduated scale linked to the basic Atuminium Work"
wages in slabs varying from 6 as. to 12 as. per day.
v.
B 'd
11
·
d
d f d
•
Their IVorkmeu
es1 es, the appe ant mtro uce
oo concession to
_
workers employed prior to 1951. Thus the constitu- Gajend,.agadka,. J.
tion of the wage structure in the appellant's concern
included dearness allowance, facility bonus aμd food
concession. In dealing with the true nature of these
payments it is necessary to take into account the appellant's case as deposed to by the appellant's Labour
Officer and Assistant to the Manager, Shri J aisuklal
Shah. According to Shri Shah, the facility bonus was
an additional allowance for the high cost of living very
much on the same footing as dearness allowance. "Two .
hours' allowance",.said Shri Shah, "is referred to as
special bonus or extra bonus. It was paid because the
workers demanded a11d it was possible to pay it at that
time". These statements lend considerable support
to the workmen's case that the payments in question
constituted a part of the wage strueture of the appellant. Indeed, even in the statement of the appellant
before the industrial tribunal in the present proceedings, it is specifically averred in paragraph 2 that
prior to June, 1952, the company's pay structure consisted of five items, viz., ( 1) basic wage, ( 2) dearness
allowance, ( 3) special bonus or extra bonus, ( 4) facility bonus or special allowance, and (5) food concession. The attitude adopted by the appellant before
Shri Palit is also consistent with this pleading and
with the evidence given by Shri Shah in the present
proceedings. Before Shri Palit, the appellant had
urged that there was no occasion to grant increment
to its workmen because under the categories of several
allowances the company had substantially constituted
its wage structure to the benefit of the workmen. In
this connect.ion, it would also be material to point out
that it was because these additional payments were
made by the appellant to its workmen· that the workmen did not raise any dispute and did not join the
arbitration before the Second Engitleering Tribunal.
666
SUPREME COURT REPORTS
[1958]
1957
Besides, these payments have been made for some
Messrs. Crown years and that also is a relevant factor to consider in
Aluminium Works dealing with the true character of these payments. If
v.
the Labour Appellate Tribunal took into account all
Their Workmen these facts and held that the payments in question are
Ga;endragadkor, J. not matters of bounty but that, in essence and in sub-
.
stance, they form part of the basic wage and dearness
allowance payable to the workmen, we see no reason
to interfere with its conclusion. It is not disputed
before us that if this conclusion is right, the Labour
Appellate Tribunal has properly· revised the wage
structure as constituted by the original tribunal and
included the payments in question in appropriate categories.
There is one more paint which may be mentioned
before we part with this case. Mr. Sen incidentally
argued that the result of the award passed by the
Labour Appellate Tribunal is that there will be two
scales of wage structure, one for those who are already
in the employment of the appellant and the other for
the new entrants. Since we have held that the modifications made by the Appellate Tribunal in favour of
the existing workmen cannot be successfully challenged by the appellant, we do not think it necessary to
consider.whether wage structure which has been fixed
by the Appellate Tribunal in regard to new entrants
into the service of the appellant is justified or not.
The result is that both the contentions raised by
Mr. Sen substantially fail. The appeal must accordingly be dismissed with costs.
Appeal dismissed.