# Z7fi KAYS CONSTRUCTION CO. (P)LTD v. STATE OF UITAR PRADESH AND OTHERS - **Citation:** [1965] 2 S.C.R. 276 - **Court:** Supreme Court of India - **Decided:** 1964-11-26 - **Case number:** Civil Appeals Nos. 1108 G and 1109 of 1963 - **Bench:** P. B. Gajendragadkar, M. Hidayatullah, J. c. SHAH, s. M. Surn, R. s. BACHAWAT - **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/z7fi-kays-construction-co-p-ltd-v-state-of-uitar-pradesh-and-others-3405 - **Pages:** 7 ## Headnote U.P. Industrial Disputes Act, 1947, sub-ss. (1) and (2) of s. 6-HBack wages of workmen-Exact amount not calculated but amendable 10 arithmetical calcula1lon-Such am~unt whether 'money due' under first clause or 'benefii capable of being computed in terms of money' ~nder second clause. The appellant company had lo pay under an award of the Labour Tribunal the back wages of some workmen. The Labour Commissioner issued a recovery certificate in respect of part of these wages to the Collector under s. 6-H(l) of the U.P. Industrial Disputes Act, 1927, and stated A B c that for the rest of the amount due be would issue another certificate later when the exact amount had been worked out. The appellant company challenged the certificate before the High Court, contending that it was not in respect of 'money due' for which proceedings under sub.s. ( 1) of· D •· 6-H could be taken, but was a 'benefit' to be compuied in terms of money for which the appropriate proceedings couli: be only under sub .... (2) of that section. A single Judge of the High Court accepted the contention of the appellant company, but his judgment was reYersed by a Division Bench of the High Court. The company appealed to the Supreme Court by special leave. HELD : The Division Bench had correctly confined the term 'benefits' £ under the second clause to benefits like rent free quarters, free electricity etc. which were not things which a man earned through his labour. In the present case what was required was not computation of money-value of 'benefits' but only an arithmetical calculation of total money wages over a certain period. The elaborate procedure under sub-s. ( 2) of 1. 6-H w"" not mean for cases where only arithmetical calculation was required. The appeal therefore could not succeed. (281 C-GJ r M.S.N.S. Transport.<, Tiruchirapalli v. Rajaram and another, [1960] I L.L.J. 336, Seshmusa Sugar Works Md. v. State of Bihar, A.LR. 1955 Patna 49, S. S. Shetty v. Bharat Nidhi Ltd., (1958] S.C.R 442, Kasturi & So113 (P) Ltd. v. N. Salivaresaram, (1959] S.C.R. I, Punjab National Bank Ltd. v. Kharbunda, [1962] Supp. 2 S.C.R. 977 and Shri Amarsinghii Mills Ltd. '" Nagarashua (M.P.), (1961] I L.L.J. 581, referred to. CrvIL APPELLATE JuR1smcnoN : Civil Appeals Nos. 1108 G and 1109 of 1963. Appeals by special leave from the judgment and order, dated March, 15, 1962 of the Allahabad High Court in Special Appeal No. 574 of 1960 and Supreme Court Appeal No. 53 of 1962 respectively. H Sir Iqbal Ahmad, K. Rajendra Chaudhuri and K. R. Chaudhuri for the appellant (in both the appeals). ,_ !CAYS CONSTRUCTION v. STATE (Hidayatullah, J.) 277 A C. B. Agarwala and 0. P. Rana, for respondents Nos. 1 to 4 (in both the appeals). ## Text Z7fi KAYS CONSTRUCTION CO. (P)LTD. v. STATE OF UITAR PRADESH AND OTHERS November 26, 1964 [P. B. GAJENDRAGADKAR, C.J., M. HIDAYATULLAH, J. c. SHAH, s. M. Surn AND R. s. BACHAWAT, JJ.] U.P. Industrial Disputes Act, 1947, sub-ss. (1) and (2) of s. 6-HBack wages of workmen-Exact amount not calculated but amendable 10 arithmetical calcula1lon-Such am~unt whether 'money due' under first clause or 'benefii capable of being computed in terms of money' ~nder second clause. The appellant company had lo pay under an award of the Labour Tribunal the back wages of some workmen. The Labour Commissioner issued a recovery certificate in respect of part of these wages to the Collector under s. 6-H(l) of the U.P. Industrial Disputes Act, 1927, and stated A B c that for the rest of the amount due be would issue another certificate later when the exact amount had been worked out. The appellant company challenged the certificate before the High Court, contending that it was not in respect of 'money due' for which proceedings under sub.s. ( 1) of· D •· 6-H could be taken, but was a 'benefit' to be compuied in terms of money for which the appropriate proceedings couli: be only under sub .... (2) of that section. A single Judge of the High Court accepted the contention of the appellant company, but his judgment was reYersed by a Division Bench of the High Court. The company appealed to the Supreme Court by special leave. HELD : The Division Bench had correctly confined the term 'benefits' £ under the second clause to benefits like rent free quarters, free electricity etc. which were not things which a man earned through his labour. In the present case what was required was not computation of money-value of 'benefits' but only an arithmetical calculation of total money wages over a certain period. The elaborate procedure under sub-s. ( 2) of 1. 6-H w"" not mean for cases where only arithmetical calculation was required. The appeal therefore could not succeed. (281 C-GJ r M.S.N.S. Transport.<, Tiruchirapalli v. Rajaram and another, [1960] I L.L.J. 336, Seshmusa Sugar Works Md. v. State of Bihar, A.LR. 1955 Patna 49, S. S. Shetty v. Bharat Nidhi Ltd., (1958] S.C.R 442, Kasturi & So113 (P) Ltd. v. N. Salivaresaram, (1959] S.C.R. I, Punjab National Bank Ltd. v. Kharbunda, [1962] Supp. 2 S.C.R. 977 and Shri Amarsinghii Mills Ltd. '" Nagarashua (M.P.), (1961] I L.L.J. 581, referred to. CrvIL APPELLATE JuR1smcnoN : Civil Appeals Nos. 1108 G and 1109 of 1963. Appeals by special leave from the judgment and order, dated March, 15, 1962 of the Allahabad High Court in Special Appeal No. 574 of 1960 and Supreme Court Appeal No. 53 of 1962 respectively. H Sir Iqbal Ahmad, K. Rajendra Chaudhuri and K. R. Chaudhuri for the appellant (in both the appeals). ,_ !CAYS CONSTRUCTION v. STATE (Hidayatullah, J.) 277 A C. B. Agarwala and 0. P. Rana, for respondents Nos. 1 to 4 (in both the appeals). The Judgment of the Court was delivered by Hidayatullab, J. These are two appeals by special leave in B which Kays Construction Co. ( P) Ltd. is the appellant. Civil Appeal No. 1108 of 1963 is against a judgment of the Allahabad High Court, dated March 15, 1962 and Civil Appeal No. 1109 of 1963 is against an order of the same High Court, dated May 9, 1962 declining to certify the case under Art. 133 of the Constitution as in the opinion of the High Court the proceedings from c which the appeal arose before the High Court was not a civil proceeding within Art. 133. As special leave has been granted against the judgment of the High Court and we are of opinion that the appeal against thilt judgment must be dismissed, we do not think it necessary to decide the other appeal. 0 The facts of the case may now be stated briefly. The appellant Company is the successor of a private concern which went under th<> name of Kays Construction Company and was owned by one Mr. H. M. Khosla who is now Managing Director of the appellant Comvany. It appears that Mr. Khosla found it unprofitable to continue the business as his own and he stopped it for a while E before Kays Construction Co. (Private) Ltd. came into existence. The appellant Company took over the business and with it, some of the workmen of the former concern but not all. This led to an Industiial dispute before the Allahabad Industrial Tribunal (Sugar) and an award was made on January 31, 1958. One of the questions in dispute before the Tribunal was the reinstatement and back wages F of the workmen who were not re-employed by the appellant Company. The Tribunal delivered an award. The parties to this appeal have not cared to produce the award but an extract from it relevant to this part of the controversy is on the record and it runs as follows :- G "As a result of my findings above, I hold that management of Messrs. Kays Construction Co. (Private) Limited, Allahabad, are required to reinstate the old workmen given in the Annexure of Messrs. Kays Construction Co., Allahabad. They will be restored in their old or equivalent jobs and given continuity of service. H In view of the somewhat peculiar features of this case and in the largest interest of the Industry, I would, however, order that the workmen be paid only 50 per cent, of their 278 SUPREME COURT REPORTS [1965) 2 S.C.R. back wages for the period they were forcibly kept out of A employment." After this award a large number of the workmen preferred claims · for their back wages purporting to do so under the fiJJSt subsection of s. 6-H of the U.P. Industrial Disputes Act, 1947. That section, shorn of provisions which do not concern us, reads as B follows:- .. 6-H( 1) Where any money is due to the workmen from an employer under the provisions of Section 6-H to 6-R under a settlement or award, or under an award given by an adjudicator or the State Industrial Tribunal appointed or constituted under this Act, before the commencement of the Uttar Pradesh Industrial Disputes (Amendment and Miscellaneous Provisions) Act, 1956, the workman may, without prejudice to any other mode of recovery, make an application to the State Government for the recovery of the money due to him, and if the State Government is satisfied that any money is so due, it shall issue a certificate for the amount to the collector who shall proceed to recover the same as if it were an arre.ar of land revenue. ( 2) Where any workman is entitled to receive from the employer any benefit which is capable of being computed in terms of money, the amount at which such (3) benefit should be computed may subject to any rule that may be made under this Act be determined by such Labour Court as may be specified in this behalf by the State Government, and the amount so determined may be recovered as provided for in subsection ( 1) . " c D E F The appellant Company made a large number of objections to this demand before the Labour Commissioner, U.P. to whom the G powers of the State Government under the first sub-section of S; 6-H had been delegated. These objections; briefly stated, were that some of the workmen had already accepted employment either with the appellant Company or elsewhere and that some of them were either not parties to the original dispute or had died subsequent to the award. The appellant Company also contended that 11 as the exact number of days for which different workmen had been forcibly kept out of employment was not determined an order KAYS CONSTRUCTION V, STATE (Hidayatu/lah, /.) 279 A under s. 6-H (I ) could not be passed. There were some other contentions into which it is not necessary to go because the case now lies within a narrow compass. On July 2 J, 1958 the Labour Commissioner, purporting to act under the first sub-section of s. 6-H issued a certificate to the B Collector, Allah.abad for the recovery of Rs. 1,06,588-6-6. Certain objections having been filed by the appellant Company before the State Government, the Regional Conciliation Officer, Allahubad was ordered to verify the claims. In the meantime, the Labour Commissioner issued another certificate on September 9, j959 by which the sum to be recovered was reduced to C Rs. 50,654-9-6. This was said to be certainly due and it was stated that for the balance another certificate would issue after the claims were fully verified. On September 10, 1959, the Collector passed' an order which was communicated telegraphically to the Chief Mechanical Engineer, North-East Railway, Gorukhpur demanding the said sum for payment to the workmen, from the security depoD sited by the appellant Company with the Chief Mechanical Engineer. On November 2, 1959 the appellant Company filed a• petition under Art. 226 of the Constitution to have the orders dated September 9 and 10, 1959 quashed by a writ of certiorari or by any other suitable order or direction and for release of some E property which, it may be mentioned, was under attachment after the first certificate was issued. The petition was heard by Mr. Justice Broome of the Allahabad High Court and was allowed by him. He quashed the two orders of the Labour Commissioner and t~1e attachment of the property on condition that the Company furnished adequate security to the satisfaction of the District f" Magistrate of Allahabad. The dispute was considerably narrowed before Broom J. The only question that was considered was whether the claim of the workmen before tbe Labour Commissioner fell to be considered under the first or the second sub-section of s. 6-H. Mr. Justice G Broome relying upon the analogy of M. S. N. S. Transports, Tiruchirapa!li v. Rajaram and Another(') decided under s. 33-C of the Industrial Disputes Act and Sesamusa Sugar Works Ltd. v. State of Bihar and Others(2) decided under s. 20 of the Industrial Disputes (Appellate Tribunal) Act, 1950, held that as the exact amount vms rt"<)uired to be determined, proceedings had to be taken before l r the Labour Court under the second sub-section to determine the money equivalent of the "benefit" t0 which the workmen were (I) [196'11IL.LJ.336. (2) A.l.R. 1935 Patr.a 49. LJSup./65-· 2 280 SUPRJ!MB COURT llEPORTS [1965) 2 S.C.R. entitled before the certificate could issue: In other words, Broome A J. was of opinion that the application of the first sub-section of s. 6-H was premature and thus erroneous. Against this decision an appeal was filed under the Letters Patent of the High Court and by the order, now under appeal, the judgment of Broome J. was reversed. The Division Bench B held that the words of the second sub-section "any benefit which is capable of being computed in terms of money" indicated benefits like free quarters or free electricity and not something which a workman earne'ti through his Jabour. Reliance was placed upon a decision of this ~ourt in S. S. Shetty v. Bharat Nidhi Ltd.(') where Bhagwati J. has pointed out that if any benefit awarded by C the Tribunal was not expressed in terms of money it was necessary to have it compμJed in, terms of money before the appropriate Government could be aslced tO help in the recovery under s. 20(2) of the Industrial Disputes (Appellate Tribunal) Act 1950. In the opinion of the Division Bench this decision supported their conclusion that the computation in terms of money of a 'benefit' was D something different: from mere arithmetical calculation of the amount of back wages. The Divisional Bench distinguished Kasturi & Sons (P) Ltd. v. N. Salivatesaram & Anr.(') on the ground that s. 17 of the )Vorking Journalists (Conditions of Service & Miscellaneous Provisions) Act, 1955 referred expressly to money due by way of compensation, gratuity and wages. The case in E Punjab National Bank Ltd. v. Kharbunda,( 3 ) where it was held that monetary advantage.or profit was not necessarily outside the word 'benefit' as used in s. 3 3C of the . Industrial Disputes Act 194 7, was also distinguished. In view of these cases the Division Bench did not follow the two rulings of the High Courts cited F earlier and another rep