# Vir•PtJJ<•PP• Yur•P/NJ fi.idompur v. 1 lu Sl•f1 of My1or1 Das GufJta, .f

- **Citation:** [1963] Supp. 2 S.C.R. 16
- **Court:** Supreme Court of India
- **Decided:** 1961-12-23
- **Case number:** Civil Appeal No. 391 of 1962
- **Bench:** P. B. Ga.Trndrag.\Dkar, A. K. Sarkar, K. N. Wanchoo
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/vir-ptjj-pp-yur-p-nj-fi-idompur-v-1-lu-sl-f1-of-my1or1-das-gufjta-f-2764
- **Pages:** 14

## Headnote

lnd,1181rial
Di8pule-Fi.ration of wage sca/c-lnduslrJ•
C'U:1'n-rcgion baRis-Applica.tion-l .11 rge and rl-is.1Jimilar concerns,
1'f and ?f'lten can br tal.·en. for co1npari«1an-.-tr{ju.r.:tment-Pml'er
of Trlbu,nal.
'l'he three matters canvassed in this appeal from an award
of the Industrial Tribunal related to ( 1) wa'<es and scales of
pay for clerical staff, (2) dearness allowance for clerical staff·
and (3) provident fund. The Tribunal found that the business
of the appellant company was able to bear the burden it im·
posed. The Tribunal also went into the history of the company
and found there had been several revision of wage scales and
dearness allowance in the recent past, but since there had been a
larl!" increase in the cost of living index for workmen from 1955
'
'
2 S.C.R.
SUPREME COURT REPORTS
17
the dearness allowance had been reduced in 1954 by agreement,
it held that a case of further revision of wage-scales had been
made out. It was urged on behalf of the appellant that wages
s~ould
be fixed
on industry-cum-region basis and the
Tribunal was in errr1r in taking for comparision industrial
concerns which w<>re entirely dissimilar to the appellant's and
that since it was paying the highest scale of wages in the industry concerned, there could be no justification for increasing
the wages.
Held, tl,at it is well settled that in considering questions
of \vagc structure, dearness allo\-\·ance and similar conditions of
service, an industrial court has to proceed on industry·cum·
region b~sis and compare similar concerns in the region which
wou Id be those in the same line of business as the concern in
cl ispute. But such comparison must not be between a small
struggling concern and a large flourishing one.
Williamson• (India) Private Ltd. v. The Workmen, (1962)
IL. L.J. 302 and Novex Dry Cleanersv. Workmen, (1952) I
L.L.J. 271, referred to.
Since in fixing of wage scales for workshop employees,
the Tribunal took into consideration concerns much larger than
the appellant's and not in the sarne line of business, the award
to the extent it was thus affected could not be upheld. Although
the appellants were paying the highest wages in the particular
line of business, that could he no ground for not revisin~ the
scales having regard to the econo1nic conditions prevailing at
the time of the dispute ; in such a case the greater emphasis
should be on the region part of the industry-cum-region
principle ; but the industrial court n1ust see that the industrial
concerns tak4fn into account for purposes of comparison are as
nearly similar to the concern before it is possible.
Although the Tribunal was justified in looking to other
concerns in the region for purposes of comparison, it should
not have taken such concerns for comparison as were dispropor·
tionately large and absolutely dissimilar from the appellant's.
The wage structure fixed for the workshop employees must
therefore be set aside. The same rule cannot, however, apply
to clerical and subordinate staff \vho stand on a different footing
f10m that of the workshop employees who are skilled workers
in the pa1 ticular line of business.
Messrs.
Lipton Limited v. Their Employees, [1959] Supp.
2 S. C.R. 150, referred to.
There is nothing in law to prevent the Tribunal from
granting adjustment even in cases where previously pay scales
1962
French Motor Car
Co., Ltd.
v.
Workm1n
1962
Fr1nelt. Afotor Car
Co, 1 Ltd.
v.
Wod:m111
Wanelioo, J.
18
SUPREME COURT REPORTS [1963]SUPP.
were in existence, but this must be done sparingly and on a
consideration of the facts and circumstances in each case.

## Text

1912
Vir•PtJJ<•PP•
Yur•P/NJ fi.idompur
v.
1 lu Sl•f1 of My1or1
Das GufJta, .f.
1962
Jt/nrtmbtr, 13.
16
SUPREME COURT REPORTS [1963] SUPP.
"in any case of alleged offences" used words like "in
any case of offences against this Act." It appears
clear that the lei(islature deliberately gave the pro·
tection of s. 16 I ( l) to offences against any law and
there is no justification for our limiting that pro.
tection to offences under the Police Act only.
It
must accordingly be held that the prosecution against
the appellant should have been 'dismissed in accordance with the provisions of s. Ill! ( l) of the Bombay
Police Act.
We accordingly allow the appeal, set aside the
order of conviction anrl sentence passed against the
'
appellant and order that the case against him be
dismissed.
Appeal allmnd.
FRENCH MOTOR CAR CO., LIMITED
v.
WORKMEN
(P. B. GA.TRNDRAG.\DKAR, A. K. SARKAR and
K. N. WANCHOO, JJ.)
lnd,1181rial
Di8pule-Fi.ration of wage sca/c-lnduslrJ•
C'U:1'n-rcgion baRis-Applica.tion-l .11 rge and rl-is.1Jimilar concerns,
1'f and ?f'lten can br tal.·en. for co1npari«1an-.-tr{ju.r.:tment-Pml'er
of Trlbu,nal.
'l'he three matters canvassed in this appeal from an award
of the Industrial Tribunal related to ( 1) wa'<es and scales of
pay for clerical staff, (2) dearness allowance for clerical staff·
and (3) provident fund. The Tribunal found that the business
of the appellant company was able to bear the burden it im·
posed. The Tribunal also went into the history of the company
and found there had been several revision of wage scales and
dearness allowance in the recent past, but since there had been a
larl!" increase in the cost of living index for workmen from 1955
'
'
2 S.C.R.
SUPREME COURT REPORTS
17
the dearness allowance had been reduced in 1954 by agreement,
it held that a case of further revision of wage-scales had been
made out. It was urged on behalf of the appellant that wages
s~ould
be fixed
on industry-cum-region basis and the
Tribunal was in errr1r in taking for comparision industrial
concerns which w<>re entirely dissimilar to the appellant's and
that since it was paying the highest scale of wages in the industry concerned, there could be no justification for increasing
the wages.
Held, tl,at it is well settled that in considering questions
of \vagc structure, dearness allo\-\·ance and similar conditions of
service, an industrial court has to proceed on industry·cum·
region b~sis and compare similar concerns in the region which
wou Id be those in the same line of business as the concern in
cl ispute. But such comparison must not be between a small
struggling concern and a large flourishing one.
Williamson• (India) Private Ltd. v. The Workmen, (1962)
IL. L.J. 302 and Novex Dry Cleanersv. Workmen, (1952) I
L.L.J. 271, referred to.
Since in fixing of wage scales for workshop employees,
the Tribunal took into consideration concerns much larger than
the appellant's and not in the sarne line of business, the award
to the extent it was thus affected could not be upheld. Although
the appellants were paying the highest wages in the particular
line of business, that could he no ground for not revisin~ the
scales having regard to the econo1nic conditions prevailing at
the time of the dispute ; in such a case the greater emphasis
should be on the region part of the industry-cum-region
principle ; but the industrial court n1ust see that the industrial
concerns tak4fn into account for purposes of comparison are as
nearly similar to the concern before it is possible.
Although the Tribunal was justified in looking to other
concerns in the region for purposes of comparison, it should
not have taken such concerns for comparison as were dispropor·
tionately large and absolutely dissimilar from the appellant's.
The wage structure fixed for the workshop employees must
therefore be set aside. The same rule cannot, however, apply
to clerical and subordinate staff \vho stand on a different footing
f10m that of the workshop employees who are skilled workers
in the pa1 ticular line of business.
Messrs.
Lipton Limited v. Their Employees, [1959] Supp.
2 S. C.R. 150, referred to.
There is nothing in law to prevent the Tribunal from
granting adjustment even in cases where previously pay scales
1962
French Motor Car
Co., Ltd.
v.
Workm1n
1962
Fr1nelt. Afotor Car
Co, 1 Ltd.
v.
Wod:m111
Wanelioo, J.
18
SUPREME COURT REPORTS [1963]SUPP.
were in existence, but this must be done sparingly and on a
consideration of the facts and circumstances in each case.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 391 of 1962.
Appeal by special leave from the award part I
dated December 23, 1961 of the Industrial Tribunal
Maharashtra in Reference (IT) No. 127 of 1960.
O. K. Daphtary, Solicitor General of lndiri, J.B.
Darlachnnji:, 0. 0. Jlf11thur and Ravinder Narain,
for the Appellant.
R. J. Mehta, Secretary, Engineering Mazdoor
Sabha.
1 62. November 13. · The Judgment of the
Court was delivered by
WANCHOO, J.-This appeal by special leave
arises out of an industrial dispute between the appel·
lant, Messrs.
French Motor Car Co., Limited, and
their workmen, who are ihc respondents before us.
Four matters were referred for adjudication by the
Government of Maharashtra under s. 10 of the Industrial Disputes Act, No. XIV of 194i, to the Industrial Tribunal, lVIaharashtra. Of these we are
concerned in the present appeal with (i) wages and
scales of pay for clerical staff, workshop employees
and subordinate staff, (ii) dearness allowance for
clerical staff, and (iii) provident fund.
The case of the respondents was that the appel·
!ant company was in a very flourishing condition and
therefore the wage-scales should be revised. The
appellant did not contend that its financial position
was not good enough to bear an increased burden ;
it, however, contended that the wage scales had been
revised only a few years before and there was no
ground for further revision so soon thereafter. The
,
2 S.C.R.
SUPREME COURT REPORTS
19
tribunal went into the financial capacity of the
appellant to bear an increased burden of wage scales
and found that its finances would be able to bear the
burden which it was going to put on it by revision of
wage scales. It also went into the history of the
appellant company to consider whether a case had
been made out for further revision of wages. That
history shows that for the first time in 1948 there was
an agreement between the appellant and its workmen
by which scales of wages were fixed.
Soon thereafter
an award was made by another tribunal in the case
of United Motors (India) Limited, which is a concern
carrying on similar business as the appellant and
much higher wage scales were found to exist in that
concern and were confirmed by the award. These
higher scales were later adopted by two other similar
concerns in Bombay, namely, Dadajee Dhakjee and
J\frtro Motors. Then followed another dispute between the appellant and its workmen in 1953 with
respect to wage scales and an award was made by
which practically the same wage scales were prescribed
as in the other three concerns, with respect to workshop employees and subordinate staff. Then in 1954
there was another agreement between the appellant
and its workmen for fixing wage scales for clerical
staff. The present dispute started in 1958, and
eventually reference was made by the Government of
Maharashtra in 1960, and the contention of the
appellant was that there was no reason to revise so
soon the wage scales, which are expected to be a
long term arrangement. The tribunal has, however,
pointed out that there has been a large increase in
1he cost of living since 1955 and the cost of living
index number for workmen had gone up from 338 in
1955 to 420 in 1960. It had gone to 428 in 1961
when the award was made. In view of this change
in economic conditions the tribunal was of the opinion
that a case had been made out for a further revision
of wage scales, particularly as the dearness allowance
was also revised in 1954 by agreement and the effect
1962
P,,.eA Motor Cto
Co., Ltd.
v.
wonW'""Mo, J.
1961
Fr1nell Motor Car
Co., Ltd.
v.
1Vcirkmm
Wanehon, J.
20
SUPRE:ME COURT REPORTS (1963] SUPP.
of that was to reduce the dearness allowance. We
see no reason in these circumstances to disagree with
the view of the tribunal that a case has been made
out for revising the wage structure.
The main contention on behalf of the appellant
is that wages are fixed on industry-cum-region basis
and the tribunal went wrong when it took into account
for comparison industrial concerns which were entirely dissimilar to the appellant's. It is now well settled
that the principle of industry-cum-region has to be
applied by an industrial court, when it proceeds to
consider questions like wage structure, dearness
allowance and similar . conditions of service. In
applying that principle industrial courts have to
compare wage scales prevailing in similar concerns in
the region with which it is dealing, and generally
speaking similar concerns would be those in the same
line of business as the concern with respect to which
the dispute is under consideration.
Further, even in
the same line of business, it would not be proper to
compare (for example) a small struggling concern with
a large flourishing concern. In Williamsons (India)
Private Ltd. v. The Workmen('), this Court had to
consider this aspect of the matter, where Williamsons
Private Limited was compared by the tribunal with
Messrs. Gillanders Arbuthnot and Company for purposes of wage fixation, and it was observed that the
extent of the business carried on by the concerns, the
capital invested by them, the profits made by them,
the nature of the business carried on by them,
their standing, the strength of thrir labour force, the
presence or absence and the extent of reserves, the
dividends declared by them and the prospects about
the future of their busine3s and other relevant factors
have to be borne in mind for the purpose of comparison. These observations were made to show how
comparison should be made, even in the same line of
business and were intended to lay down that a small
concern cannot be compared even in the same line
of business with a large concern. Thus where there is
(I) (1962) IL. L.J. 302.
,
r
2 S.C.R.
SUPREME COURT REPORTS
21
a large disparity between the two concerns in the
same business, it would not be safe to fix the same
wage structure as in the large concern without any
other consideration. The question whether there is
large disparity between two concerns is, however,
always a question of fact and it is not necessary for
the purposes of comparison that the two concerns
must be exactly equal in all respects.
All that the
tribunal has to see is that the disparity is not so large
as to make the comparison unreal. In Novex Dry
Gleaners v. Workmen (1) this Court pointed out that
it would not be safe to compare a comparatively
small concern with a large concern in the same line
of business and impose a wage structure prevailing in
the large concern as a rule of thumb without considering the standing, the extent of labour force, the
extent of business and the extent of profits made by
the two concerns over a number of years.
The contention on behalf of the appellant is
that in fixing the wage structure for workshop
employees in particular, the tribunal has taken into
account for purposes of comparison concerns which
are in a different line of business altogether and
which are also very much bigger concerns than the
appellant company. There is in our opinion force in
this contention.
In dealing with the workshop
employees, the tribunal has taken into account wages
prevalent in concerns like Greaves Cotton and Dumex,
which are very much larger concerns than the appel·
!ant company and which are also not in the same line
of business. It is obvious that the fixing of wage
scales for workshop employees made by the tribunal
has been affected by taking into account these concerns, and to that extent the· award cannot be upheld.
At the same time it appears that the appellant company is practically paying the highest wage scales in
the particular line of business in which it is engaged,
and it is urged. on its behalf that if it is compared
with concerns in its own line of business, there would
(I) (1962) I I. L.J. 271.
1962
French Afotor Ca,
Co., ltd.
v.
Worknun
Wandwo1 J.
1962
FrneA Motor Cor
Co., Ltd.
v.
Workmm
22
SUPREME COURT REPORTS (1963] SUPP.
be no justification for increasing the wage scales for
it is already paying the highest scales in that line of
business. We are of opinion that this argument cannot be accepted, for it would then mean that if a
concern is paying the highest wages in a particular
line of business, there can be no increase in wages
in that concern whatever may be the economic conditions prevailing at the time of dispute. It seems to
us, therefore, that where a concern is paying the
highest wages in a particular line of business, there
should be greater emphasis on the region part of the
industry-cum-region principle, though it would be the
duty of the industrial court to see that for purposes
of comparison such other industries in the region are
taken into account as are as nearly similar to the concern before it as possible. Though, therefore, in a
case where a particular concern is already paying the
highest wages in its own line of business, the industrial
courts would be justified in looking at wages paid in
that region in other Jines of business, it should take
care to see that the concerns from other lines of business taken into account are such as are as nearly
similar as possible, to the line of business carried on
by the concern before it. It should also take care to
see t!.Mt such concerns are not so disproportionately
large as to afford no. proper basis for comparison. In
the present case even though ihe tribunal had justification to go beyond the concerns in the particular
industry in which the appellant company is engaged
for purposes of comparison, because the appellant is
already practically paying the highest wages in that
line of business, it was not right for the tribunal to
take for comparison concerns like Dumex and Greaves
Cotton which are in completely different and dissimilar lines of business and also so disproportionately
larger than the appellant company as not to afford
a proper basis of comparison. We are therefore of
opinion that the wage structure fixed by the tribunal
so far as workshop employees are concerned cannot be
upheld and must be set aside. In the circumstances
'
2 S.C.R.
SUPREME COURT REPORTS
23
the award with respect to the workshop employees is
set aside and the matter remanded to the tribunal .to
fix proper wage scales in the light of the observations
made by us.
It appears that evidence: was given before the
tribunal for purposes of comparison of concerns which
were in the line of business nearly similar to the business carried on by the appellant company. Consequently, it would not be necessary to take fresh
evidence on the point and the tribunal should proceed
to fix the wage structure afresh after excluding for
purposes of camparison concerns in absolutely different
lines of business and also concerns which are disproportionately larger than the appellant company.
Turning now to the wage scales for clerical and
subordinate staff, the argument on behalf of the
appellant is the same viz., that the tribunal has taken
for comparison concerns which were really not comparable. There is however, difference between workshop emplayees on the one hand and clerical and
subordinate staff on the other, for
worhshop
employees generally require a particular skill which
is yeculiar to the particular industry, while the same
cannot be said to a great extent with respect to the
clerical and subordinate staff. A somewhat similar
question was considered by this Court in Messrs.
Lipton Limited v. Their employees(').
In
that
case the tribunal was considering the question
of wage fixation for clerical and subordinate staff,
and the argument on behalf of the employer· was that
there was .no reliable evidence to show that in any
comparable industry in the same region the wages
were higher and therefore. the wage structure in the
particular case required · revision.
The employer
concerned in that case was Messrs. Lipton Limited,
carrying on tea business as merchants in Delhi. Evidence was given by the workmen in that case about
the scales of pay of employees in the Delhi office of a
Ill (1959] Supp. 2 S. C.R. 150,
1962
Fun.ch Motor Ctw
Co,, Ltd.
v.
WorA-mm
WancAioo, J.
1962
Fr1ncA Motor Car
Co., Ltd.
v.
Workmm
Wanchoo_ J.
24
SUPREME COURT REPORTS (1963] SUPP.
number of other concerns like the Standard Vacuum
Oil Company, Thomas Cook (Continental) Overseas,
Burmah Shell, Lever Brothers (India) Limited, and
Associated Companies and Marshall Sons and Company (India) Limited. But it was contended on behalf of the employer that these were not comparable
concerns. Some were oil concerns and some engineering and some manufacturing concerns. The workmen, however, contended that so far as drivers,
sweepers, peons, clerks, godown keepers, typists, stenographers, and the like were concerned, the nature of
their work was the same in all the aforesaid concerns
which were relied on for comparison, and therefore it
could not be said, as urged by the employer, that
there was no evidence of comparable concerns. This
Court observed in that connection that it was impossible to say that there was no evidence on which the
tribunal could proceed to revise the wage structure
and that on the contrary there was evidence which
justified a revision of the wage structure. In effect
this decision means that in case of employees of the
class mentioned therein it may be possible to take
into account even those concerns which are engaged
in entirely different lines of business for the •work of
employees of this class is more or less similar in ,all
concerns. We are in agreement with this view and
the argument therefore urged on behalf of the apJJ,ellant company cannot prevail so far as clerical 'Mid
subordinate staff are concerned.
It appears however that a mistake has been
made by the tribunal in respect of subordinate staff.
The subordinate staff in the. appellant company consists of drivers, watchmen, peons, cleaners and
sweepers. According to the system prevailing in the
company, drivers and watchmen stood by themselves
-_
· and had separate scales. Peons, cleaners and sweepers
were however in the same scale and were treated
similarly in this company. What the tribunal has
done is to prescribe one scale for drivers, another for
2 S.C.R.
SUPREME COURT REPORTS
25
watchmen, peons and cleaners and a third for
sweepers, thus distributing the system prevailing in
the appellant company without any reason given for
it. It appears that the tribunal made a mistake inadvertently when it said that in this company the
scales of watchmen, peons and cleaners had been uniform.
That was in fact not so and the respondents'
counsel also fairly admits it. In the circumstances
we direct that the order of the tribunal fixing the
scale of 50-3-77-4-85 for watchmen, peons and cleaners
will only apply to watchmen and not to peons and
cleaners. We also order that the scaie of 40-2-58-373 will apply not only to sweepers but also to peons
and cleaners. The.appeal therefore with respect to
clerical staff and subordinate staff must fail except
as to the modification pointed out above.
We now come to dearness allowance for clerical staff. We have already indicated that dearness
allowance was revised by agreement in 1954 with
respect to claical staff, and the revision resulted in
reduction. What the tribunal has done is to set
aside the agreement of 1954 and to bring back the
system of dearness allowance prevailing before that
agreement. In the circumstances we cannot see how
the system now introduced by the tribunal which is
also more in consonance with the pattern of dearness
allowance prevailing in Bombay and which was in
force in the appellant company itself before 1954 can
be successfully challenged.
We therefore reject the
contention of the appellant in this behalf.
We now come to provident fund.
It appears
that in this company there is a scheme of gratuity as
well as provident fund.
Originally, the rate of provident fund contribution in this company was 8 1/3
per centum of the basic pay but from July 1, 1960,
the rate has been changed to 6 1/4 per centum of the
gross earning i. e. basic pay plus dearness allowance, on
the application of the Employees Provident FundsAct,
(No. XIX of 1952) and the Employees Provident Funds
1962
l 11neh Motor Car
Co., Ltd
v.
Worknun
Wan&hoo, J.
1962
Frmch Motor Car
Co., Ltd.
v.
f¥tukm1n
i.Yanchoo, J,
26
SUPREME COURT REPORTS [1963] SUPP.
Scheme, 1052, to this industry. What the tribunal
has done is to fix the contribution at 8 per centum of
the gross earnings (i. e. basic pay plus dearness
allowance) instead of the present rate of 6 1/4 per
centum. This has been done on the sole ground that
a technical committee had reported some time before
the tribunal made its award that the rate should be
raised to eight per centum of the gross earnings (i.e.
basic pay plus dearness allowance). The Tribunal
therefore increa5ed the provident fund contribution
to eight per centum on the ground that that percentage was recommended by the technical committee
after a thorough study of the problem from all points
of view and it should be adopted by well-established
and prosperous concerns like the appellant, though
the tribunal was not unaware of the fact that this was
not the rate generally prevalent in that region. It is
urged on behalf of the respondents that legislation is
under contemplation in this respect; but the fact
remains that no law has so far been made making any
change in the rate of contribution. We see no reason why simply because some recommendation, which
is still to be implemented, has been made by a
Committee, that the contribution should be increased
to eight per centum in the case of the appellant company only, when the general rate is only 6 I/4•per
centum. In the circumstances, this part of the award
must be set aside and the rate of provident fund contribution so far as the appellant company is concerned
should remain at 6i per centum of the gross earnings
(i. e. basic pay plus dearness allowance) as at present.
We now come to the question of adjustment.
The contention on behalf of the appellant is that
when wage scales were introduced in the appellant
company, they were granted on a generous scale and
there was therefore no reason for adjustment in the
~
manner in which the tribunal has done in this case,
for it is'not usual to grant adjustment where wage
scales already existed, though adjustment is granted
2 S.C.R.
SUPREME COURT REPORTS
27
when wage scales are fixed for the first time by
tribunals. On the other hand, it is contended on
behalf of the respondents that industrial tribunals
have been granting adjustments even where wage
scales existed formerly
and that the grant of
. adjustment is not limited to those cases where wage
scales are being introduced for the first time. ln
this connection, reliance was placed on behalf of the
respondents on a number of awards which were
listed in Ex. U-15. We asked parties to give an
agreed statement as to what these awards provided
in the matter of adjustment and whether they showed that adjustment had been granted by industrial
tribunals even where there were wage scales from before. Such an agreed statement has been filed. The
large majority of the awards listed in Ex. U-15 show
that they are cases where wage scales were being fixed
for the first time and adjustment
was therefore
granted whether point to point or in such other
manner as the tribunals considered just on the facts
and circumstances of each case. In some of the
cases, however, it appears that adjustment was granted even though there were previous scales of pay
in existence. The ground for such grant of adjustment seems to have been that the previous scales
were found
to be low
and
the increments
prescribed thereunder were particularly
low. In
those circumstances, . the tribunal was of the view
that adjustment should be granted even though there
had been previous scales of pay.
A review therefore of the cases cited on behalf
of the respondents shows that generally adjustments
are granted when scales of wages are fixed for.the
first time. But there is nothing in law to prevent
the tribunal from granting adjustment even in cases
where previously pay scales were in existence; but
that has to be done sparingly taking into consideration the facts and circumstances of each case. The
usual reason for granting adjustment even where
1962
Fr1rula A!otor Car
Co., Ltd.
v.
Wo,kmm
Wanchoo, J .
1962
F11neh MtJtor Car
Co., Lid.
v.
Workmen
Wa11dwo, J.
28
SUPREME COURT REPORTS [1963) SUPP.
wage scales were formerly in existence is that the
increments provided in the former wage scales were
particularly low and therefore justice required that
adjustment should be granted a second time. In the
present case, however, grades of pay for clerical staff
which were existing previously providC"d increments
from Rs. 5/- to Rs. 10/- per year, which was in
accordance with the rate of increments prevailing
generally in the region for such staff.
Further in
the case of unskilled workshop employees and subordinate staff the previous rate of increment in the
appellant company was comparatively on a generous
scale as compared to even such companies as Dumex
Private Limited and Greaves Cotton Company.
The same could be said of the semi·skilled grade and
even of the skilled grade previously in force in this
company. In the circumstances, it seems to us that
there is no just iii cation for adjustment in the manner
provided by the tribunal when new scales are fixed
in the present case, and all that should be reasonably
provided in the matter of adjustment is that when an
employee is brought on to the new scale his pay
should be· stepped up to the next step in the new
scale in case there is no such pay in the new scale.
We ought to add that· in making the order of adjustment the tribunal did not consider the merits of the
rival contentions from this aspect. In a case of this
kind we do not think that adjustment should have
been ordered almost as a matter of course. Nor
have the respondents satisfied us that a case has been
made out for granting adjustments even when a com·
paratively generous rate of increment was in force
m this company previously and the company was
paying the highest wages in its own line of business.
We are therefore of opinion that the order as to adjustment should be modified as above.
The last point is with respect to clarification.
So far as that is concerned, the parties agreed that
after the publication of Part I of the award the
I
2 S.C.R.
SUPREME COURT REPORTS
29
company will classify its employees and send its
classification to the sabha (i. e. the union). The
sabha will then file its objection if any and finally
the disputed cases will be decided by the tribunal.
The tribunal therefore did not go into the question
of classification when it gave the award under
appeal, though there are some observations in the
award which appear to have some bearing on the
quC'ltion of classification.
However, in view of the
fact that the tribunal has not gone into the question
of classification at this Ftage any tentative obscrva·
tions made by it would not affect the agreement
"
between the parties, viz,. that the employees will
in the first instance be classified by the appellant
company and the classification will be sent to the
union which will have the right to object and there·
after the disputed cases will be decided by the tribu·
nal. In view of this agreement no question of
classification arises at the present stage.
We therefore partly allow the appeal and set
aside the order of the tribunal with respect to workshop employees and remand the case for fixing their
wages in the light of the observations made by us in
this judgment. We also set aside the order with
respect to provident fund and redu~e the coptribution
to 61 per centum. We also set aside the order as to
adjustment which shall be carried out hereafter in
the manner provided in this judgment. The appeal
as regards ~alary in the case of clerical staff and sub·
ordinate staff (except for the modification re: sub·
ordinate staff), and dearness allowance to the clerical
staff fails and is hereby dismiss~d. We may add
that the new scales of pay to be fixed on remand
shall take effect from July l, 1960, as already ordered
in the present award. In the circumstances the
parties will bear their own costs.
A ppetJl allowed in prJrt.
1962
French Mol~r C1t
Co., ltd.
v.
WorAmm
Wunchoo. J.