# PAYMENT OF WAGES INSPECTOR v. SURAJMAL MEHTA & ANR

- **Citation:** [1969] 2 S.C.R. 1051
- **Court:** Supreme Court of India
- **Decided:** 1968-12-03
- **Case number:** Civil Appeal No. 1577 of 1966
- **Bench:** J. M. Shelat, C. A. Vaidialingam
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/payment-of-wages-inspector-v-surajmal-mehta-anr-4554
- **Pages:** 10

## Headnote

Payment of Wages Act (4 of 1936), ss. 2(vi)d and 15, and Industrial
Disputes Act (14 of 1947), SS, 25FF and 33C(2)-Retrenchment compensation under s. 25FF, Industrial Disputes Act-If wages under Payment of
Wages Act-Jurisdiction of Authority under s. 15, Payment, of Wages
Act-Scope of.
·
The State Electricity Board revoked the licence of a company and took
over the undertaking. The !st respondent, who was the director of the
company, served notices on the employees that their services would not be
required. Thereupon, the appellant filed an application under s. 15(2) o'f
the Payment of Wages Act, 1936, on behalf of the employees, for re·
covering from the !st respondent wages for the notice month and retrenchment compensation under s. 25FF of tlie Industrial Disputes Act, 1947.
The !st respondent contested the claim as well as the jurisdiction of the
authority under the Payment of Wages Act to deal with the application, on
the ground that he was not the person responsible !for payment of. compensation and that the right of the workmen was defeated by reason of the
proviso to s. 25FF of the Industrial Disputes Act, because there was no
interruption in their employment and the new employer (the Electricity
Board) was responsible:for payment of the compensation. But the Authority held against the !st respondent. The !st respondent then filed a writ
petition in the High Court and the High Court held that s. 15 of .the Act
did not apply and that the proper forum for such an application was the
Labour Court under s. 33C(2) o'f the Industrial Disputes Act, 1947.
In appeal to this Court, on the questions : (1) Whether compensation
payable w1der s. 25FF of the Industrial Disputes Act can fall under the
amended definition of wages ins. 2(vi)d of the payment of Wages Act, as
it is a 'sum which by reason of the termination of employment of the person employed, is ·payable under any law .... which provides for the payment df such sum whethe·r with or without deductions but does not provide
for the time within which the payment is to be made' and . (2) Whether
the authority under s. .15 of the Payment of Wages Act had jurisdiction to
entertain the application,
HELD : (I) The three sections, namely
s. 25F introduced into the
Industrial Disputes Act, by Act 43 of 1951, and ss. 25FF and 25FFF incorporated by Act 18 of 1957, involve termination of service in consequence of retrenchment, transfer and closure respectively. In ss. 25FF and
25FFF notice and compensation have been provided for 'in accordance
with the provisions oif s. 25F. These words are used only as a measure of
compensation and are not used for laying down any time within which the
employer must pay compensation. . Since section 25FF unlike s. 25F, does
not contain any conditions precedent, it can be said not to have provided
any time within which such compensation is to be paid. Therefore, the
compensation payable under s. 25FF read with s. 25F of the Indμstria,I ..
Disputes Act would be wages within the meanin.g of s. 2(vi) (tl) t>f the Pity-''",
ment of Wages Act. [1055 C-E]
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1052
SUPRE:ME COURT REPORTS
.. [1969] 2 S.C.R.
Ml•. Hatisjngh
Mfg. Co. Ltd. v. Union of India,
[1960] 3 S.C.R.
A
528 and Anakapa/la Co-operative Agricultural and
Industrial
Society
Ltd. v. Workmen, [1963] Supp. I S.C.R. 730, followed.
( 2) The words 'where
contrary
to the provisions of the Act, in
s. 15(2) of the Payment of Wages Act being the governing words, the
Authority appointed under s. 15 ( 1) has jurisdiction to entertain applications only in two classes of cases, namely, of deductions and fines not
authorised under ss. 7 to 13 of the Payment of Wages Act and of delay
in payment of wages beyond the wage periods fixed und<:r s. 4 and time
c:Jf payment laid down in s. 5. Section 15(1) provides that the Authority has the power to determine all matters incidental to the claim arising
from deductions from or delay in payment of wages, but while deciding
whether a particular matter is

## Text

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PAYMENT OF WAGES INSPECTOR
v.
SURAJMAL MEHTA & ANR.
December 3, 1968
(J. M. SHELAT AND C. A. VAIDIALINGAM, JJ.]
Payment of Wages Act (4 of 1936), ss. 2(vi)d and 15, and Industrial
Disputes Act (14 of 1947), SS, 25FF and 33C(2)-Retrenchment compensation under s. 25FF, Industrial Disputes Act-If wages under Payment of
Wages Act-Jurisdiction of Authority under s. 15, Payment, of Wages
Act-Scope of.
·
The State Electricity Board revoked the licence of a company and took
over the undertaking. The !st respondent, who was the director of the
company, served notices on the employees that their services would not be
required. Thereupon, the appellant filed an application under s. 15(2) o'f
the Payment of Wages Act, 1936, on behalf of the employees, for re·
covering from the !st respondent wages for the notice month and retrenchment compensation under s. 25FF of tlie Industrial Disputes Act, 1947.
The !st respondent contested the claim as well as the jurisdiction of the
authority under the Payment of Wages Act to deal with the application, on
the ground that he was not the person responsible !for payment of. compensation and that the right of the workmen was defeated by reason of the
proviso to s. 25FF of the Industrial Disputes Act, because there was no
interruption in their employment and the new employer (the Electricity
Board) was responsible:for payment of the compensation. But the Authority held against the !st respondent. The !st respondent then filed a writ
petition in the High Court and the High Court held that s. 15 of .the Act
did not apply and that the proper forum for such an application was the
Labour Court under s. 33C(2) o'f the Industrial Disputes Act, 1947.
In appeal to this Court, on the questions : (1) Whether compensation
payable w1der s. 25FF of the Industrial Disputes Act can fall under the
amended definition of wages ins. 2(vi)d of the payment of Wages Act, as
it is a 'sum which by reason of the termination of employment of the person employed, is ·payable under any law .... which provides for the payment df such sum whethe·r with or without deductions but does not provide
for the time within which the payment is to be made' and . (2) Whether
the authority under s. .15 of the Payment of Wages Act had jurisdiction to
entertain the application,
HELD : (I) The three sections, namely
s. 25F introduced into the
Industrial Disputes Act, by Act 43 of 1951, and ss. 25FF and 25FFF incorporated by Act 18 of 1957, involve termination of service in consequence of retrenchment, transfer and closure respectively. In ss. 25FF and
25FFF notice and compensation have been provided for 'in accordance
with the provisions oif s. 25F. These words are used only as a measure of
compensation and are not used for laying down any time within which the
employer must pay compensation. . Since section 25FF unlike s. 25F, does
not contain any conditions precedent, it can be said not to have provided
any time within which such compensation is to be paid. Therefore, the
compensation payable under s. 25FF read with s. 25F of the Indμstria,I ..
Disputes Act would be wages within the meanin.g of s. 2(vi) (tl) t>f the Pity-''",
ment of Wages Act. [1055 C-E]
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1052
SUPRE:ME COURT REPORTS
.. [1969] 2 S.C.R.
Ml•. Hatisjngh
Mfg. Co. Ltd. v. Union of India,
[1960] 3 S.C.R.
A
528 and Anakapa/la Co-operative Agricultural and
Industrial
Society
Ltd. v. Workmen, [1963] Supp. I S.C.R. 730, followed.
( 2) The words 'where
contrary
to the provisions of the Act, in
s. 15(2) of the Payment of Wages Act being the governing words, the
Authority appointed under s. 15 ( 1) has jurisdiction to entertain applications only in two classes of cases, namely, of deductions and fines not
authorised under ss. 7 to 13 of the Payment of Wages Act and of delay
in payment of wages beyond the wage periods fixed und<:r s. 4 and time
c:Jf payment laid down in s. 5. Section 15(1) provides that the Authority has the power to determine all matters incidental to the claim arising
from deductions from or delay in payment of wages, but while deciding
whether a particular matter is incidental to the claim or not, care should
be taken neither to unduly
expand or curtail the jurisdiction of the
Authority, because, the jurisdiction
is a special
jurisdiction.
Section
15(2) postulates that the wages payable by the person responsible for
payment under s. 3 are certain and such that they cannot be disputed.
[1058 B-Dl
In the present case, (a) the claim was not a simple case of deduc·
!ions having been unauthorisedly made or payment having been delayed
beyond the wage periods or the time of payment fixed under ss. 4 and
5 of the Act;
(b) In view of the. de'fence taken by the !st respondent, the failure
to pay compensation did not fall under ss. 4 and 5 of the Act; and
· ( c) The claim for compensation
denied by the
employer
in the
circumstance could not fall within the ambit of s. 15(2). [1059 HJ
It could not have been intended that such matters could be tried by
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the Authority under the Act as matters incidental to the claim of comE
pensation under s. 25FF. The proper forum would
be the
Labour
Court which can decide sm:h questions under s. 33C(2) of the Industrial Disputes Act, since such court can go up into those matters fully,
expeditiously and without expense. [1060 C]
Punjab National Bank Ltd. v. Kharbanda,
[1962] Supp. 2 S.C.R.
977, Central Bank of India Ltd. v. Rajagopalan,
[1964] 3 S.C.R. 14-0,
Bombay Gas Co. Ltd. v. Gopal Bhiva, (1964] 3 S.C.R. 709, D'Costa v.
F
B. C. Patel, [1955] I S.C.R. 1353 andi Shri Ambica Mills Co. Ltd. v. S. B.
Bhatt; [1961] 3 S.C.R. 220, referred to.
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1577 of
1966.
Appeal from the judgment aJ!ld order dated March 25, 1964
of the Madhya Pradesh High Court in Misc. Petition No. 31 of
1963.
I. N. Shroff, for the appellant.
The respondent did not appear.
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The Judgment of the Court was delivered by
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ShelJit, J . . This appeal, by certificate, is directed against the
judgment and order of the High Court of Madhya Pradesh and
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l'AYMllNT OF WAGES INSTR. v. SURAJMAL (She/at, J.) 1053
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raises the question of the scope of jurisdiction of the Authority
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under the Payment of Wages Act, 4 of 1936 (hereinafter referred
to. as the Act.)
On the licence of the Barnagar Electric Supply and Industrial Company, of which respondent 1 was at all material times
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'the managing diredtor, having been revoked by the Madhya
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Pradesh Government and the company's undertaking having been
taken over by the Madhya Pradesh' Electricity Board, respondent
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1 served notices on the company's employees that their services
would no longer be required as from October l, 1962. Thereupon the appellant on behalf of 20 employees of the company
filed an application under sec. 15(2) of the Act to recover from
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respondent 1 wages for the notice month and retrenchment compensation amounting to Rs. 12,853.60P. payable to the employees
under sec. 25FF of the Industrial Disputes Act, 194 7.
On respondent 1 contesting the claim as also the jurisdiction of the
Authority, the Authority raised certain preliminary issues, namely :
(1) whether the said application was maintainable in view of the
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revocation of the company's licence, (2) whether the Authority
had jurisdiction to determine the liability of respondent 1 for retrenchment compensation before the amount thereof was ascertained under sec. 3 3C(2) of the Industrial Disputes Act and (3)
whether in view of the services of the workmen not having been
interrupted by the said transfer and the terms and conditions of
service applicable to them after the said transfer being not in any
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way less favourable than before and the said Board as the new
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employer being liable after the transfer for compensation in the
event of retrenchment, the employees were entitled to claim any
compensation. By his order dated May 21, 1963 the Authority
held against respondent 1 on the question of jurisdiction. Respondent 1 thereupon filed a writ petition in. the High Court and
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Division Bench of the High Court held that sec. 15 of the Act
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did not apply and that the proper forum for such an application
was a Labour Court under sec. 33C(2) of the Industrial Disputes
Act. This appeal challenges the correctness of this order.
Mr. Shroff for the appellant contended ihat after the amendment of the definition of 'wages' in the Act by Act 68 of 1957
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and the amended definition having now included "any sum which
by reason of the termination of employment of the person emII! '
ployed is payable under any law, contract or instrument which
provides for payment of such sum whether with or without deductions but does not provide for the time within which the pay-
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ment is to be made" as wages, there could be no doubt that the
legislature has conferred jurisdiction on the Authority under the
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Act to determine compensation payable under sec. 25FF of the
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Industrial Disputes Act in an application under sec. 15(2) of the ·
Act and that therefore the Hi~h Court was in error. in quashing the
order passed by the Authority.
Mr. Chagla, appearing for the
1054
SUPREME COURT· REPORTS
-(1969] 2 $.C.R.
Respondents 1 and 2 i\11 the next appeal, on th_e other hand, conA \
tended ( 1) that the Authority under the Act was a special Authority with_ limited jurisdiction, that it_ has _to deal only with the
subject matters specified in the Act and its jurisdiction must there.-
fore be strictly construed, and ( 2) that the Act a.nd the Industrial Disputes Act deal with different subjects, provide different
tribunals with different jurisdictions and therefore it is not possible
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to hold that Parliament which enacted _ b\)th the Acts
could
possibly have contemplated that claim arising under the Industrial Disputes Act_ should be determined by a tribunal set up under
a different- Act. ·
On these contentions the first question which arises for determination is whether compensation payable under sec. 25FF of the
Industrial Disputes Act can fall under the _amended definition in
sec. 2(vi)(d) of the Act and can be called 'wages'. The High Court
thought that it was not but Mr. Shroff relied on ceirtain decisions
of this Court to contest that part of the'' conclusion of the High
Court. The Industrial -Disputes Act, which as ·enacted in .194 7,
was a piece of legislation which mainly provided :machinery for
investigation and settlement of industrial disputes, has since then
undergone frequent modifications. .In 1953, by Act 43 of that
year Chapter VA consisting of secs. 25A to 25J was incorporated
providing therein compensation for lay-off and retrenchment. It
also provided a definition of retrenchment in sec. 2(00). Chapter
VA, as it then stood, did not expressly provide for compensation
for termination of service on account of transfer of an undertaking by an agreement or as a result of operation _of law or the
closure of the undertaking. Consequently, in Hariprasad, v.
Divikar(') this Court held that retrenchment as d<efined in sec.
2( oo) and the word 'retrenched' in sec. 25F meant discharge of
surplus labour or staff by the employer for any reason whatsoever
otherwise than as a punishment inflicted by way of disciplinary
action and did not include termination of services of all workmen
on a bona fide closure of an undertaking or on a change of ownership or management thereof. This decision was followed first by
an ordinance and then by_ Act 18 of 1957 incorporating in the
Act the present ss. 25FF and 25FFF. It will be noticed that
both these sections use the words "as -if the workman had been
retrenched". The intention of the legislature was, tl1erefore, clear
that it did not wish to place transfer and closure on the same footing as retrenchment under sec. 25F.
This is apparent also from
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the fact that it left the dt~finition of retrenchment in sec. 2(oo) untouched in spite of the decision in Hariprasad's case('). The
three sections, ss. 25F, 25FF and 25FFF also show that
\Vhile under sec. 25F no retrenchment can be mad<~ until condiI{
tions therein set out are carried oht, the·other:twq:sections <lo nqt.
lay down any such conditions. · A.U tbe .. three secti·ons, llowe.Yei·,"
(I) [1957] S.C.R. 121.
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PAYMENT OF WAGES INSTR. v. SURAJMAL (ShcJat, J.) 1055
involve termination of service whether it results in consequence of
retrenchment or transfer or closure, and notice and compensation
in both ss. 25FF and 25FFF have been provided for "in accordance with the provisions of sec. 25F".
(se.e M/s Hatisingh Mfg.
Co. Ltd. v. Union of India(') and Anakapalla Co-operative Agricultural and Industr.ial Society Ltd. v. Workmen( 2 ). That being
the position a workman whose service is terminated in consequence of a transfer of an undertaking, whether by agreement or by
operation of law, has a statutory right under sec. 25FF to compensation unless such right is defeated under the proviso to that
section. The same is the position in the case of closure under sec.
25FFF. Such compensation would be wages as defined by sec.
2(vi)(d) of the Act as it is a "sum which by reason of the termination of employment of the person employed, is payable under any
law .... which provides for the payment of such sum whether
with or without deductions but does not provide for the time within
which the payment is to be made." Since ss. 25FF and 25FFF
do not contain any conditions precedent, as in the case of retrenchment under sec. 25F, and transfer and closure can validly take
place without notice or payment of a month's wages in lieu thereof
or payment of compensation, sec. 25FF can be said not to have
provided any time within which such compensation is to be paid.
It is well established that the words "in accordance with the provisions of sec. 25F" in ss. 25FF and 25FFF are used only as a
mea.sure of compensation and are not used for laying down any
time within which the employer must pay the compensation. It
would, therefore, appear that compensation payable under ss.
25FF and 25FFF read with sec. 25F would be 'wages' within the
meaning of sec. 2(vi)(d) of the Act.
It must, however, be remembered that though such compensation falls within the definition of wages, cases may arise where it
would not be a simple question of recovery of wages. In the present case, for instance, the defence taken by respondent 1 was that
he was not the person responsible for payment of compensation
and that the right of the workmen was defeated by reason of the
proviso to sec. 25FF being, according to him, applicable inasmuch
as these workmen were continued in the employment by the said
Board, the new employer, that therefore there had been no interruption in their employment, that the terms and conditions of service given to them by the new employer were in no way less favourable than those they had when the company was the employer,
and that the new employer was responsible for payment of compensation if any retrenchment took place in future.
The question,
therefore, is whether in view of the limited jurisdiction of the Authority under sec. 15(2) of the Act, it was intended to deal with such
questions, which in some cases might well raise complicated problems of both fact and law.
(1) [1960] 3 S.C.R. 528.
(2) [1963] Supp, (!) S.C.R. 730.
L 6Su1> Cl/69-16
I 0$6
SUPREME COVRT REPORTS
(1969) 2 s.c.R
While considering the scope of jurisdiction of the Authority
under sec. 15 of the Act it is relevant to bear in mind the fact that
the right to compensation is conferred by the Industrial Disputes
Act which itself provides a special tribunal for trying cases of
individual workmen to whom compensation payable under Ch.
VA has not been paid. Section 33C of that Act provides both a
forum and the procedure for computing both monetary as well as
non-monetary benefits in terms of money and further provides
machinery for recovery of such claims. In Punjab National Bank
Ltd. v. Kharbanda(') this Court held that while sub-sec. 1 of sec.
3 3C applied to cases where any money was due to a workman from
an employer under a settlement, award or under the provisions of
Ch. VA and the amount was already computed or calculated or at
any rate there could be no dispute about its calculation or compu·
tation, sub-sec. 2 applied to benefits including monetary bel)efits
conferred on a workman under an award, settlement etc., but which
had not been calculated or computed and there was a dispute as
to their calculation or computation. The Court rejected the contention that sub-sec. 2 applied only to a non-monetary benefit
which had to be converted in terms of money.
The Court also
observed that sec. 33C was a provision in the nature of execution
and where the amount to be executed was worked out or where
it might be worked out wit!Jout any dispute sub-sec. 1 would
apply, but where such amount due to the workman was not stated
or worked out and there was a dispute as to its calculation, sub.-
sec. 2 would apply and the workman would be entitled to apply
·t!Jereunder to have the amount computed provided he was entitled
to a benefit, whether monetary or non-monetary, which was capable of being paid in terms of money. In the Central Bank of
India Ltd. v. Rajagopalan( 2 ) this Court held t!Jat where the right
of a workman was disputed by his employer the Labour Court
c.ould go into t!Je question as to whether he had a right to receive
such a benefit.
Sub-sec. 3 of sec. 33C under which the Labour
Court can appoint a commissioner to take evidence for computing
the benefit postulates 1hat it has the jurisdiction to decide whether
the workman claiming benefit was entitled to it where such right
was disputed by the employer. In Bombay Gas Co. Ltd. v. Gopal
Bhiva( 3 ) this Court held that the Labour Court could in an application unier sec. 33C(2) go even into the question whether the
award under whic)l the workman had made a claim was a nullity.
Being in the nature of an executing court it could interpret the
award and also consider the plea that the award sought to be
enforced was a nullity. It is thus clear that a workman whose
claim, monetary or otherwise, is disputed by his employer can
lodge such a claim before a specified Labour Court. under sec.
33C and obtain ail inexpensive and expeditious remedy.
The
(1)
(1962] Supp. 2 S.C.R. 977.
(2)
[1964] 3 S.C.R. 140.
(3) (1964] 3 S.CR. 709.
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PAYMENT OF WAGES INSTR. v. SURAJMAL (She/at, J.) 1057
question then is whether for such a claim the legislature intended
to provide alternative remedies both under the Industrial Disputes
Act and the Payment of Wages Act. For deciding this question
it is necessary to refer to some of the provisions of and the scheme
of the Payment of Wages Act.
The Act was passed to regulate the payment of wages to certain classes of persons employed in any tactory or by a railway
administration or by a person fulfilling a contract with a railway
adnunistration or in any industrial establislunent to which a State
Government by notification has extended the Act. Section 3 lays
down as to who shaJ! be responsible for payment of wages.
Section 4 provides for the hxation of wage periods and sec. 5
lays down the time within which payment of wages has to be
made. Sec. 7 provides that wages shaJl be paid without any deductions except those authorised by the Act and sec. 8 provides
that no fine shall be imposed on any employed person save in
respect of such acts or omissions on his part as the employer with
the previous approval of the State Government or the prescribed
authority may have specified by notice.
Sections 9 to 13 lay
down the deductions which an employer is authorised to make
and the conditions under which such deduction can be made.
Section 13A provides for the maintenance of certain registers and
records by the employer and ss. 14 and l 4A provide for appointment of inspectors under the Act, their powers and the facilities
to be afforded by the employer to such inspectors. Section 15 ( 1)
provides for the appointment of a person to be the Authority
under the Act to hear and decide for any specified area claims
arising out of (a) deduction from wages or ( b) delay in payment of wai;es .of persons employ~d or paid in that area including
all matters mc1dental to such claims. Sub-sec. 2 provides that
"Where contrary to the provisions of this Act any deduction has
been made from the wages of an employed person, or any payment.~£ wages has been .delayed,. su.ch person himself, or any legal
pract1110ner or any official of a registered trade union .
. .
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or any inspector under this Act, or any other person acting with
the permission of the authority .
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may apply to such
authority for
a direction under sub-sec.
3." The first
proviso to sub-sec. 2 lays down a period of limitatio,n of 12
months from the date of deduction or the due date of payment and
the second proviso empowers the Authority to admit applications
beyond the period of limitation on sufficient cause being shown.
Sub·sec. 3 empowers the Authority to direct refund to the employed person of the amount deducted, or the payment of the delayed
wages and also empowers it to award compensation specified
therein without prejudice to any other penalty to which the employer guilty of unauthorised deduction or delay in payment is
liable under the Act.
Under sub-sec. 5 of sec. 15 the amount
1058
SUPREME COuRT REPORTS
[l.969j 2 S.CR.
awarded by the authority can be recovered as if it were a fine
imposed by a magistrate.
Section 20 provides for penalty for
offences under certain provisions of ss. 5, 7, 8, 9, 10 and 11 to
13 extending upto Rs. 500/·.
It is explicit from the terms of sec. 15(2) that the Authority
appointed under sub-sec. 1 has jurisdiction to entertain applications only in two classes of cases, namely, of deductions and fines
not authorised under ss. 7 to 13 and of delay in payment of
wages beyond the wage periods fixed under sec. 4 and the time
of payment laid down in sec. 5. This is clear from the opening
words of sub-sec. 2 of sec. 15, namely, "where contrary to the
provisions of this Act" any deduction has been made or any payment of wages has been delayed.
These being the governing
words in the sub-sec. the only applications which the Authority
can entertain are those where deductions unauthorised under the
Act are made from wages or tliere has been delay in payment
beyond the wage period and the time of payment of wages fixed
or prescribed under ss. 4 and 5 of the Act. Section 15(2) postu·
!ates that the wages payable by the person responsible for payment under sec.
3 are certain and such that they cannot be
disputed.
In D'Costa v. B. C. Pate/(1) this Court held after considering
the scheme of the Act that the jurisdiction of the Authority under
sec. 15 was confined to deductions and delay in payment of the
actual wages to which the workman was entitled and that the
Authority under the Act had no jurisdiction to enter into a question of potential wages, i.e., where the workman pleads . that he
ought to have been up-graded as persons junior to him were upgraded and that he ought to have been paid wages on a scale
paid to those so up-graded. This Court held that the Authority
had judisdiction to interpret the terms of a contract of employment to find out the actual wages payable to the workman where
deduction from or delay in payment of such wages is alleged, but
not to enter into the question whether the workman should have·
been up-graded from being a daily rated worker to a monthly
rated workman. In Shri Ambica Mills Co. Ltd. v. S. B. Bhatt(')
this Court again examined the scheme of the Act and held that
the only claims which could be entertained by the Authority were
claims arising out of deductions or delay made in the payment
of wages.
The Court, however, observed that in dealing with
claims arising out of deductions or delay .made in payment of
wages the Authority inevitably would have to consider questions
incidental to these matters, but in determining the scope of these
incidental matters care must be taken to see that under the guise
of deciding incidental matters the limited jurisdiction was not unreasonably or unduly expanded. Equally, care must also _be taken
(1)
[19:i5] 1 S.C.R. 1353.
(2)
[1961] 3 S.C.R. 220.
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PAYMENT OF WAGES INSTR. v. SURAJMAL (She/at, J.) 1059
to see that the scope of these incidental matters was not unduly
curtailed so as to affect or impair the limited jurisdiction conferred on the Authority.
The Court declined to Jay down any
hard
and fast rule which would afford a determining test to
demarcate the field of incidental facts which could be legitimately
c~nsidered by the Authority and those which could not be so
considered.
It is true, as stated above; that the Authority has the jurisdiction to try matters which are incidental to the claim in question.
Indeed, sec. 15 (1) itself provides that the Authority has the power
to determine all matters incidental to the claim arising from
deduction from or delay in payment of wages. It is also true that
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while deciding whether a particular matter is incidental to the
claim or not care should be taken neither to unduly expand nor
curtail the jurisdiction of the Authority. But it has at the same
time to be kept in mind that the jurisdiction under sec. 15 is a
special jurisdiction. The Authority is conferred with the power
to award compensation over and above the liability for penalty of
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fine which an employer is liable to incur under sec. 20.
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The question, therefore, is whether on the footing that compensation payable under ss. 25FF and 25FFF of the Industrial
Disputes Act being wages within· the meaning of sec. 2 (vi) ( d) of
the Act, a claim for it on the ground that its payment was delayed
by an employer could be entertained under sec. 15(2) of the Act.
In our view it could not be so entertained. In the first place, the
claim made in the instant case is not a simple case of deductions
having been unauthorisedly made or payment having been delayed
beyond the wage-periods and the time of payment fixed under
ss. 4 and 5 of the Act. In the second place, in view of the defence
taken by Respondent 1, the Authority would inevitablv have to
enter into questions arising under the proviso to sec. 25FF, viz.,
whether there was any interruption in the employment of the workmeu, whether the conditions ot service under the Board were
any the less favourable than those under the comoany and whether
the Board, as the new employer, had become liable to oay compensation to the workmen if there was retrenchment in the future.
Such an inquiry would necessarily be a prolonged inquirv involving questions of fact and of law. Besides, the failure to pay compensation on the ground of such a plea cannot be said to be either
a deduction which is unauthorised under the Act. nor can it fall
under the class of delayed wages as envisaged by ss. 4 and 5
of the Act. It may be that there may conceiYeably be cases of
claims of compensation which are either admitted or which cannot be disputed which by reason of its falling under the definition
of wages the Authoritv may have iurisdiction to trv nnd determine. But we do not think that a claim for compensation under
sec. 25FF which is denied by the employer on the ground that it
1060
SUPREME COURT REPORTS
(196')] 2 5.CR.
was defeated by the proviso to that section, of which all the conditions were fulfilled, is one such claim which can fall within the
ambit of sec. 15(2). When the definition of wages was expanded
to include cases of sums payable under a contract, instrument or
a law it could not have been intended that such a claim Jor compensation which is denied on grounds which inevitably would
have to be inquired into and which might entail prolonged inquiry
into questions of fact as well as law was one which should be
summarily determined by the Authority under seo. 15.
Nor
could the Au_thority have been intended to try as matters inciden- ·
ta! to such a claim questions arising under the proviso to sec.
25FF. In our view it would be the Labour Court in such cases
which would be the proper forum which can determine such questions under sec. 3 3C(2) of the Industrial Disputes Act which also
possesses power to appoint a commissioner to take evidence where
question of facts require detailed evidence. Mr. Shroff, however,
drew our attention to the decision in Uttam Chand v. · Kartar
Singh(') a decision of a learned Single Judge of th!~ High Court
of Punjab, taking a view contrary to the one which we are inclined to take.
But that decision contains no reasons and is,
therefore, hardly of any assistal)ce.
In the result we agree with the_ High Court that the Authority
had no jurisdiction under sec. 15(2) of the Act to try these applications.
The appeal consequently must fail and is
dismissed.
But we make no order· as to costs.
Y.P.
Appeal dismissed.
(1)]1967] 1 LL.J. 232,
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