Civil Appeal No 34 of 1980
From the Judgment and Order dated 7 11 1979 of the Madras High Court in Writ Petition No 288676
Soli J Sorabjee DN Gupta and H K Dutt for the Appellant
R K Garg and V J Francis for the Respondent
The Judgment of the Court was delivered by SEN J
This appeal on certificate from the judgment of the Madras High Court raises a question of some complexity
The ques 304 tion is whether an employer is statutorily bound to pay wages if the workmen are on strike for any of the national or festival holidays falling within the period of strike under s3 read with sub s1 of s5 of the Tamil Nadu Industrial Establishments National and Festival Holidays Act 1958 hereinafter to referred to as the Act 
The facts of the case are not in dispute
Messrs Madura Coats Limited are an industrial establishment within the meaning of s2e of the Act owning textile mills at Madurai Ambasamudram and Tuticorin in the State of Tamil Nadu
The cotton textile industry had been declared to be a public utility service for purposes of the 
In respect of claim for bonus for the year 1974 75 a settlement was entered into which stood superseded by the Payment of Bonus Ordinance 1975
The management accordingly took the view that no bonus was payable for the year in question since its payment would be against the provisions of the Act as amended by the Ordinance
This resulted in a strike by the workmen of the concerned mills
The workmen were on strike from January 21 1976 to February 5 1976
The strike was called off by the workmen on February 6 1976 due to the intervention of the Commissioner of Labour Madras who brought about a settlement
The proceedings of the Commissioner of Labour dated February 5 1976 show that the parties ie the management and the workmen had agreed to abide by his decision in the matter
The terms of the settlement were inter alia that the strike was to be called off forthwith and the workmen would commence work on February 6 1976 that the management s proposal 10 make a penal cut of eight days  wages of the workmen for going on an illegal strike would be waived and that there would be no wages payable for the period of the strike
In accordance therewith the workmen resumed work on February 6 1976 and the management paid them wages for the month of January 1976 after excluding there from the wages payable for the period of strike during January namely for the period from January 21 to 31 1976
The management having withheld the wages payable for January 26 1976 the Inspector of Factories Ist Circle Madurai addressed a communication dated May 22 1976 stating that in view of s5 of the Act payment of wages for January 26 1976 had to be made
The management challenged the order by a writ petition but the High Court declined to interfere
It held that the appellant was bound to pay to the workmen wages for January 26 1976 having regard to the provisions contained in s3 and sub s1 of s5 of the Act even though the workmen were on strike on that day
The correctness of that decision is in question
305 It is urged firstly that in view of the term wages  in s2g of the Act no wages were payable to the workmen for January 26 1976 in terms of the contract of employment since they were not available for work and thereby the management were deprived of the right given to them under sub s2 of s5 of the Act to call upon the workmen to come and do the work and secondly the right of the workmen to receive wages for the national or festival holidays under s3 of the Act is subject to the right of the management under sub s2 of s5 to call upon them to come and work on such holidays
It is said that when a person creates a situation by going on a strike whereby he is not available for work the terms of employment cannot be fulfilled and therefore a fortiori no wages are payable
It is suggested that the right of the workmen to wages is not dependent on their status as such but on the fulfilment of the contract of employment
It would be convenient in the first instance to set out the relevant provisions of the Act
In the Act the term wages  as defined in s2g insofar as relevant is in these terms 2g Wages means all remuneration capable of being expressed in terms of money which would if the terms of employment express or implied were fulfilled be payable to an employee in respect of his employment or of the work done by him in such employment 
Section 3 of the Act provides as follows 3
Grant of National and Festival holidays Every employee shall be allowed in each calendar year a holiday of one whole day on the 26th January the first May the 15th August and the 2nd October and five other holidays each of one whole day for such festivals as the Inspector may in consultation with the employer and the employees specify in respect of any industrial establishment
 Sub sections 1 and 2 of s5 of the Act provide 5
Wages 1 Notwithstanding any contract to the contrary every employee shall be paid wages for each of the holidays allowed to him under section 3
2a Notwithstanding anything contained in section 3 any employee
may be required by the employer to work on 306 any holiday allowed under that section if the employer has not less than twenty four hours before such holiday i served in the prescribed manner on the employee a notice in writing requiring him to work as aforesaid and ii send to the Inspector having jurisdiction over the area in which the industrial establishment is situated and displayed in the premises of the industrial establishment a copy of such notice
b Where an employee works on any holiday allowed under section 3 he shall at his option be entitled to i twice the wages or ii wages for such day and to avail himself of a substituted holiday with wages on one of the three days immediately before or after the day on which he so works
 The legislation is intended to provide for national and festival holidays in industrial establishments in the State
Section 3 of the Act provides that every employee in an industrial establishment shall be entitled to four national and five festival holidays in each calendar year
Sub section 1 of s5 provides that notwithstanding any contract to the contrary  every employee shall be paid wages for each of the holidays allowed to him under s3
The matter is thus taken out of the realm of contract
There is a statutory obligation cast on the employer and a corresponding benefit conferred on the employees
The word allowed  in sub section
1 of s5 means holidays allowed under s3
In other words the employer has no option in the matter
There can be no contracting out of the liability to pay wages for such holidays
It will be noticed that both sub sections
1 and 2 of s5 contain non obstante clauses
While the non obstante clause in sub s1 of s5 gives to the workmen the right to claim wages for such holidays notwithstanding any contract to the contrary  the non obstante clause in sub section
2 of s5 subordinates the right of the workmen to claim wages for the national or festival holidays notwithstanding anything contained in s3 
Sub sections 1 and 2 of s5 have been enacted with separate and distinct objects and they operate on different planes
Sub section 2 of s5 confers upon the employer the right to call 307 upon the workmen to come and work on such holidays on the fulfilment of the conditions set out therein
As a matter of construction the non obstante clause contained in sub section
2 of s5 has an overriding effect over s3
The right of the workmen to claim wages under sub section
1 of s5 for any of the national and festival holidays under s3 is therefore co extensive with the right of the management under sub s2 of s5 to call upon the workmen to come and work on such holidays subject to the compliance with the conditions laid down therein
On the construction of sub s2 of s5 of the Act and its impact on s3 and sub s1 of s5 of the Act there is a conflict of opinion in the High Court
In Vasudevan RMS Union vs Lotus Mills Ltd Koshal J in dealing with a case where the workers of a textile mill went on a strike and in between there were two paid holidays held that wages for the holidays in question were payable despite the strike since sub s1 of s5 was absolute and unconditional and gave to the employees the right to stay away from work
He was of the view that s3 and sub s1 of s5 operate independently without reference to sub s2 of s5 and as such even if the management had no opportunity to call upon the workmen to come and work on national and festival holidays as provided for in sub s2 of s5 they were bound to declare such national and festival holidays under s3 and pay wages for these holidays to the workmen as provided by sub s1 of s5
In substance Koshal J was of the view that the legislature never intended to give to sub s2 of s5 an overriding effect so as to make the fulfilment of the terms of contract of employment and of the work done a condition prerequisite for the payment of wages for the national or festival holidays
When the matter came before Natarajan J he expressed his doubts about the correctness of the view taken in Lotus Mills case
In his view the benefit conferred on the workmen under s3 and sub s1 of s5 cannot be taken to be independent of sub s2 of s5 which confers a special right on the management to call upon the workmen to come and work on national and festival holidays declared under s3 and so long as that right of the management could not be exercised as the workmen were on strike on these days the benefits cannot be enforced by the workmen
He accordingly referred the case to a Division Bench for a reconsideration of the decision in Lotus Mills case
The Division Bench Ramanujam and Padmanabhan JJ however disagreed with him and preferred to 308 follow the view taken by Koshal J expressed in Lotus Mills case
The question is which of the two views is in accord with the provisions of the Act
Ramanujan J speaking for the Division Bench while accepting that sub s2 of s5 conferred a special right on the management which is somewhat inconsistent with s3 and sub s1 of s5 comments that these provisions confer two benefits on the employees viz 1 not to work on a holiday and 2 to get wages from the management for such holiday  and observes If the right conferred on the management under section 52 is intended to override the right given to the employees under section 3 and 51 the legislature would have specially said so by giving an overriding effect to section 52
But so long as section 52 does not specifically override section 3 and 51 it is not possible for us to say that sections 3 and 51 are subject to section 52
The right conferred on the management under section 52 and the right conferred on employees under sections 3 and 51 should be taken to be independent of each other Emphasis supplied This observation virtually renders sub s2 of s5 a mere superfluity
Furthermore the assumption that the Act confers the right not to work on a holiday  appears to be unwarranted
The ultimate conclusion of the High Court was that the contract of service continues even during the period of strike and therefore though in the instant case the employees were on strike they still continued to enjoy the benefits of the Act and must be paid their wages for 26th January 1976 even though they were on strike
In our judgment the construction placed by the High Court on sub s2 of s5 of the Act cannot be accepted
It is apparently wrong in observing that if the legislature intended such a result the language used would have been different 
That precisely is the effect of the non obstante clause in sub s2 of s5 which clearly has an overriding effect over s3
Under the scheme of the Act the workmen are entitled to wages for the national and festival holidays under s3 read with sub section
1 of s5 but this right of theirs  is subject to the right of the management given under sub s2 of s5 to call upon the workmen to come and work on such holidays
Any other construction would make the provisions contained in sub section
2 of s5 wholly nugatory
309 It would depend on the facts and circumstances of each case whether or not wages become payable in the context of strike
It is true that where a strike is neither illegal being not in contravention or any statutory provision nor unjustified having been lodged as a protest against the unreasonable attitude of the management there is no reason to deprive the workmen of their wages
It must nevertheless be observed that workmen cannot resort to strike with impunity for any kind of demand without first exhausting reasonable avenues for possible achievement of their object
In the present case the affidavit of the Inspector of Factories First Circle Madurai shows that the dispute between the management and their workmen as to payment of bonus for the year 1974 75 had been referred to the Special Industrial Tribunal Madras which gave a decision in favour of the workmen
That has a bearing on the claim for bonus but has no relevance to the question in controversy
It appears that the workmen went on a strike without serving a notice under section 22 of the 
That being so the strike resorted to by the workmen was wholly unjustified if not illegal
When the workmen themselves brought about a situation by going on a strike they cannot be permitted to claim wages under sub s1 of s5 of the Act since the management were deprived of their right under sub s2 of s5 of the Act
In Buckingham and Carnatic Co Ltd vs Workers of the Buckingham and Carnatic Co Ltd the night shift operatives of a textile mills stopped work from about 4 pm upto about 8 pm on a certain day the apparent cause of the strike being that the management had expressed their inability to comply with the request of the workers to declare the forenoon of that day as a holiday for solar eclipse
The stoppage of work was the result of a concerted action and fell within the definition of a strike  in s2q of the 
The strike was an illegal strike as the textile mills was a public utility industry and no notice had been given to the management even though the refusal to work continued only for a few hours
It was held that the continuity of service of the workers was interrupted by the illegal strike and therefore they were not entitled to claim holidays with pay under section 49 B1 of the Factories Act 1934
In Management of Chandramalai Estate Ernakulam vs Its Workmen the workmen made certain demands and the matter was referred for conciliation
After conciliation efforts failed the workmen struck work
The question was whether the workmen were entitled to 310 paid holidays for the period of strike
It was held on the facts of the case that the strike was unjustified and the workmen were not entitled to any wages for the period
The question ultimately is one of fact
The liability of the management to pay wages for the national and festival holidays under s3 read with sub s1 of s5 of the Act is subject to their right under sub s2 of s5 of the Act to call upon the workmen to come and work on such holidays
That depends upon whether or not the strike was illegal or unjustified
In the result the appeal succeeds and is allowed
The judgment of the High Court is reversed
The writ petition filed by the appellant is allowed and the impugned notice issued by the Inspector of Factories is quashed
We wish to mention that the appellant has undertaken to pay wages to the workmen for 26th January 1976 irrespective of the result of the appeal
There shall be no order as to costs
NVK Appeal allowed


Summary:
The Tamil Nadu Industrial Establishment National and Festival Holidays Act 1958 was a legislation intended to provide for national and festival holidays in industrial establishments in the State of Tamil Nadu
Section 3 of the Act provides that every employee in an industrial establishment shall be entitled to four national and five festival holidays in each calender year
Sub section 1 of section 5 provides that notwithstanding any contract to the contrary every employee shall be paid wages for each of the holidays allowed to him under section 3
Sub section 2 of section 5 confers upon the employer the right to call upon the workmen to come and work on such holidays on the fulfilment of the conditions set out therein The appellant was an industrial establishment owning textile mills in the State of Tamil Nadu
In respect of a claim for bonus for the year 1974 75 there was a dispute between the management and its workmen
This resulted in a strike by the workmen from January 21 1976 to February 5 1976 which was called off by the workmen on February 6 1976
The management paid the workmen wages for the month of January 1976 after excluding therefrom the wages payable for the period of strike during January namely January 21 to January 31 1976
The Management having withheld the wages payable for January 26 1976 the first respondent addressed a communication stating that in view of section 5 of the Act payment of wages for January 26 1976 had to be made
The management challenged the order by a Writ Petition in the High Court
The High Court held that having regard to the provisions contained in sections and sub section I of section 5 of the Act the appellant was bound to pay the workmen wages for January 26 1976 even though the workmen were on strike on that date and dismissed the Writ Petition Allowing the appeal to this Court  HELD 1 The liability of the Management to pay wages for the national and festival holidays under section 3 read with sub section 1 of section 5 of the Act is subject to the rights under sub section 2 of section 5 of the Act to call upon the workmen to come and work on such holidays
303 2 The construction placed by the High Court on sub Section 2 of section 5 of the Act cannot be accepted
Under the scheme of the Act the workmen are entitled to wages for the national and festival holidays under section 3 read with sub section I of section 5 but this right of theirs  is subject to the right of management given under sub section 2 of section 5 to call upon the workmen to come and work on such holidays
Any other construction would make the provision contained in sub section 2 of section 5 wholly nugatory
308H 309A 3 Both sub sections 1 and 2 of section 5 contain non obstante clauses
While the non obstante clause in sub section I of section 5 gives to the workmen the right to claim wages for the national or festival holidays notwithstanding any contract to the contrary  the non obstante clause in sub section 2 of section 5 subordinates the right of the workmen to claim wages for the national or festival holidays notwithstanding anything contained in section 3
sub sections 1 and 2 of section 5 have been enacted with separate and distinct objects and they operate on different planes
306H 307A Vasudevan RMS Union vs Lotus Mills Ltd 1977 II LLJ 483 overruled
4 It would depend on the facts and circumstances of each case whether or not wages become payable in the context of strike
When a Strike is neither illegal being not in contravention of any statutory provision nor unjustified having been lodged as a protest against the unreasonable attitude of the management there is no reason to deprive the workmen of their wages
309B Buckingham and Carnatic Co Ltd vs Workers of the Buckingham and Carnatic Co Ltd  and Management of Chandramalai Estate Ernakulam vs Its Workmen  referred to
In the instant case the workmen went on strike without serving a notice under section 22 of the Industrial Dispute Act 1947
That being so the strike resorted to by the workmen was wholly unjustified if not illegal
When the workmen themselves brought about a situation by going on a strike they cannot be permitted to claim wages under sub section 1 of section 5 of the Act since the management were deprived of their right under sub section 2 of section 5 of the Act
309E