THE HON’BLE SRI JUSTICE K.C. BHANU WRIT PETITION No.27008 OF 2010 ORDER: This Writ Petition is filed seeking to declare Notice and consequential show-cause notice Lr.No.E/1253/2009, dated 20.07.2010 and 05.08.2010, respectively issued by respondent No.3 and Notice No.C/RR Act/1212/10, dated 29.09.2010 issued by respondent No.5, as illegal and further, direct respondent Nos.1 to 5 not to proceed further. 2. The averments in the Writ Petition, in brief, may be stated as follows: The petitioner is a reputed Newspaper organization engaged in business of printing, publishing and distributing various Newspapers. The petitioner is a ‘Newspaper Establishment’ as defined under Section 2 (d) of the Working Journalists & Other Newspaper Employees (Conditions of Service) And Miscellaneous Provisions Act, 1955 (for short, “the Act”). The service conditions of the employees of the petitioner establishment are governed by Certified Standing Orders framed under the Indian Employment Standing Orders Act. Insofar as the wages are concerned, it is implementing the Awards of Wage Boards constituted by the Central Government, which fixes wages for the employees of various categories. One of the earliest Awards passed by Justice Sri Bachawat, which was the Wage Board Award, dated 26.05.1998, was challenged by the petitioner and the Honourable Supreme Court held in its judgment that despite the Award, a settlement can be arrived at. Time and again Wage Boards are constituted for the purpose of fixing wages. The latest Award was passed by Justice Sri Manisana on 25.07.2000. Keeping in view the recommendations of the Wage Board, the petitioner entered into a long-term settlement with the Recognized Union of the petitioner establishment on 22.11.2002, under Section 18 (1) of the Industrial Dispute Act, 1947 (for short, “ID ACT”), wherein the parties have agreed to implement the Manisana Award with effect from 01.01.2002. Industrial Tribunal in M.P.No.2 of 2004, I.D.No.60 of 2005 and I.D.No.7 of 2007 has held that the settlement, dated 22.11.2002, is valid and that the settlement is implementable with effect from 01.01.2002. In view of the settlement, the petitioner started paying the Wages inclusive of Dearness Allowance (DA) to its employees with effect from 01.01.2002, the date of implementation of Manisana Award, which was entered in the settlement. All the employees received Wages including DA and signed the fitment sheets fixing the Wages including DA from 01.01.2002. While the matter stood thus, some of the employees of the petitioner establishment, including respondent Nos.6 to 17 herein, approached respondent No.3 and respondent No.6 filed an application on 29.07.2009 before respondent No.3 for payment of alleged difference of DA for the period from 15.12.2000 to March, 2009. Based on the said application, respondent No.3 issued a show-cause notice, dated 24.09.2009, to the petitioner under Section 17 (1) of the Act. The petitioner herein sent a detailed reply to respondent No.3 on 29.01.2010 informing that it was paying wages to all its employees based on the settlement, dated 22.11.2002, including DA and that the claim made by its employees is baseless and requested to reject the claim. Though initially 28 employees approached respondent No.3 for implementation of DA as per Manisana Award, later 11 employees after realizing that their claim is incorrect, invalid and unsustainable, withdrew their applications from respondent No.3. Respondent No.3 basing on the reply submitted by the petitioner, through proceedings No.E/1253/2009, dated 06.04.2010, came to a conclusion that since there was a dispute in existence, alternate remedy is that the disputed issue has to be referred to an appropriate Labour Court constituted under ID Act, as per Section 17 (2) of the Act. Thereafter, the petitioner received another notice, dated 02.06.2010, from respondent No.3 on the same subject along with an Office Memo No.L1/11452/2009, dated 21.05.2010, of the Office of the Commissioner of Labour, Andhra Pradesh, Hyderabad, in which it was stated that the Additional Commissioner of Labour i.e., respondent No.2, has returned 12 (4) report to respondent No.3 on certain grounds directing to take necessary action under Section 17 (1) of the Act, besides asking the petitioner to submit its remarks based on the observations made by respondent No.2. In response to the said notice and particularly with reference to the remarks made by respondent No.2, the petitioner submitted its reply on 21.06.2010 stating that petitioner has already filed a detailed reply to the effect that the Management had entered into settlement with its workmen, under Section 18 (1) of the ID Act, to implement the Manisana Wage Board Award from January, 2002; that the said settlement, dated 22.11.2002, includes payment of DA as well; that the petitioner has been paying DA and other allowances to its employees with effect from 01.01.2002; that the Industrial Tribunal in M.P.No.2 of 2004, I.D.No.60 of 2005 and I.D.No.7 of 2007, upheld the settlement, dated 22.11.2002, entered into between the Management and employees for implementation of Manisana Award from 01.01.2002 and stated that the said settlement is final and binding on all parties; that the Labour Department ignoring the said settlement and judicial pronouncement, again made an attempt to examine the same aspect by issuing the notice for the second time; and that all the employees, including respondent Nos.6 to 17 herein, were given fitment sheets and they have accepted the same without any protest and have received salaries and DA, including DA revision, as per quarterly price index based on the settlement for the last eight years. As there was a dispute between the parties, respondent No.3, which had earlier recommended the matter for adjudication, ought to have again referred the matter to the Labour Court for adjudication. Instead, respondent No.3 again sent notice, dated 30.06.2010, for joint meeting on the already closed issue, by making his own calculations for different periods in the said claim petition. Respondent No.3 sent another notice on the same subject on 20.07.2010, ignoring the earlier submissions of the petitioner. Respondent No.3 on his own arrived at a quantum payable and came to a hypothetical conclusion that the petitioner failed to pay the said amounts. Though the petitioner sent a detailed reply earlier, it again sent another reply on 29.07.2010 to the notice, dated 20.07.2010, wherein it reiterated that it has implemented the Wage Revision including DA as per Manisana Award read with Section 18 (1) of the ID Act settlement and categorically disputed the calculation made by respondent No.3 in respect of claim of respondent No.6, as the same was wholly incorrect and without any basis. Ignoring the submissions/objections made by the petitioner, respondent No.3 through proceedings, dated 05.08.2010, issued a show-cause notice, to the petitioner to show cause as to why the alleged claims shall not be recovered from it under Section 17 (1) of the Act and proceeded further for recovery of the amount under the provisions of Revenue Recovery Act, 1890. Respondent No.5 issued the notice No.C/RR Act/1212/10, dated 29.09.2010, showing the reference of letter of respondent No.4. This Court in W.P.No.6939 of 2008, by order, dated 14.01.2008, passed orders stating that the legality or enforceability of such claim, is very much at issue. Therefore, the claims made by the employees are totally outside the scope of Section 17 (1) of the Act. Further, it is a matter to be adjudicated under the provisions of ID Act and the provision of Section 10 of the ID Act, which are made applicable to Working Journalists also. Therefore, in the absence of adjudication of the claims of the employees, whether under ID Act or Section 17 (2) of the Act on the basis of evidence on record, respondent Nos.4 and 5 shall not have any jurisdiction to initiate action for recovery of the amounts, if any, due under Revenue Recovery Act. Respondent No.5 even without issuing a show-cause notice, directly made a demand to pay huge amount. Further, an individual can raise the issue of Wages disputed only by a reference under Section 10 of the ID Act and not directly under Section 17 (2) of the Act, which is similar to Section 33-C (2) of the ID Act and unless his right is resolved by duly made reference, no claim can be adjudicated. Even Section 17 (2) of the Act would not apply because it is similar to Section 33-C (2) of ID Act. A disputed claim has to be properly adjudicated under Section 10 of the ID Act, which is applicable to provisions of the Act. Equally non-exposal of the matter by a Recognized Union with substantial representative capacity is fatal to the petition filed by respondent Nos.6 to 17, and so, no directions can be given on such an incompetent petition. Therefore, issuance of the notice dated 29.09.2010 by respondent No.5 is outside the purview of the Act, as it is premature and a hasty action. The procedure that has been adopted by respondent Nos.1 to 3 is contrary to the provisions of the labour jurisprudence. Respondent No.3 while acting under the Act has straight away started making roving enquiry under the provisions of Section 17 (1) of the Act without taking any evidence on both sides, which is contrary to the procedure. That once respondent No.3 comes to a conclusion that there was a dispute about the claims and that the said matter was referred by him for adjudication to the appropriate Government for reference, he becomes functus officio of the same subject. Hence, the Writ Petition. 3. Counter affidavit is filed by respondent No.7 and on behalf of respondent Nos.6 and 8 to 17. The counter averments may be stated as follows: The contention of the petitioner that insofar as wages are concerned, it is implementing the Awards of Wage Board constituted by the Central Board, which fix wages for the employees of various categories, is not correct. It is true that the latest Award was passed by Justice Sri P. Manisana on 25.07.2000, and that the petitioner has entered into settlement with the Registered Union to implement the Manisana Award with effect from 01.01.2002. The averment that in view of the settlement, the petitioner started paying wages inclusive of DA with effect from 01.01.2002 to its employees is not correct. The petitioner is not paying the DA as fixed in the Manisana Award and in this regard, these respondents have approached respondent No.3 for payment of the difference of DA from 15.12.2000 to March, 2009, and therefore, a show-cause notice was issued by respondent No.3 under Section 17 (1) of the Act to the petitioner. The averment that initially 28 employees have approached respondent No.3 and later realizing that their claims are incorrect, 11 employees have withdrawn their application is not correct. Respondent No.3 addressed a letter to respondent No.2 on 06.04.2010, seeking reference to the labour Court with regard to the issue as to whether these respondents are justified or not in claiming the DA amounts shown against each employee with effect from 15.12.2000 from the Management of the petitioner. On receipt of the said report, respondent No.2 issued a memo, dated 21.05.2010, wherein he examined the failure report with reference to the Judgment of the Supreme Court and held that the agreement reached under Section 18 (1) of the ID Act only relates to the implementation of Manisana Wage Board recommendations but not on the implementation of DA announced from time to time notified by Manisana Board. It is clear that as per the agreement, respondent Nos. 6 to 17 are entitled to DA based on scales, that were in existence prior to 01.01.2002 and after 01.01.2002, as per Section 18 (1) agreement they are entitled to the DA as per the revised scales of Wage Board recommendations. Their claims shall also be calculated for subsequent period i.e., from 01.04.2009 to till the date of transfer. On the basis of the above reasoning, respondent No.2 observed that respondent No.3 ought to have examined this aspect and disposed of the claim notice, dated 24.09.2009, in respect of 28 employees under Section 17 (1) of the Act. After the order is passed, the respondent No.3 issued another notice, dated 02.06.2010. To the notice so issued, the petitioner has submitted a reply, dated 21.06.2010, and in the said reply, the petitioner has not replied with regard to the payment of variable DA payable to the various categories of employees. The petitioner referred to the Award of the Industrial Tribunal, which has got nothing to do with regard to the payment of the variable DA from the date of settlement. Only the implementation of the Manisana Award was postponed and the settlement entered between the Management and the Registered Union is that instead of implementing the Manisana Wage Board recommendations from 25.07.2000, it should be implemented from 01.01.2002. Therefore, the petitioner is bound to pay the Wages and the DA in terms of the Award passed by the Manisana Wage Board with effect from 01.01.2002. There is no dispute about it and hence, the question of referring the matter for adjudication does not arise. Respondent No.3 calculated the amount as per the Manisana Wage Board Award and issued a notice to the petitioner. The contention of the petitioner that respondent No.3 on his own arrived at a quantum payable and came to a hypothetical conclusion that the petitioner failed to pay the amounts is wholly untenable. Except stating that the petitioner has complied with the Wage Board Regulations, the petitioner has not placed any proof with regard to the payment of the amount. The contention of the petitioner that the provisions of Section 17 (1) of the Act have no application to the facts of the case is not correct. There is no adjudication involved and it is only the mathematical calculation with regard to the variable DA as per the Formula fixed in the Award. The petitioner is liable to pay the wages and the variable DA from the date of settlement. Except alleging that the petitioner has paid the amount, it has not produced any documentary evidence to substantiate its contention that the variable DA is paid. Respondent No.3 after taking the said factor into consideration has rightly issued the impugned notice and consequential show-cause notice. The contention of the petitioner that respondent No.3 became functus officio and cannot issue the notice on the same subject is untenable. The action of respondent No.3 in directing the petitioner to pay the difference in variable DA to respondent Nos.6 to 17 is perfectly legal and valid. Respondent Nos.6 to 17 are entitled to the variable DA amount. The entitlement of the amount is already mentioned in the Manisana Wage Award and though the petitioner has agreed to implement the Award from 01.01.2002, it is not paying the variable DA as fixed in the Manisana Award. Hence, it is prayed to dismiss the Writ Petition. 4. Learned counsel for the petitioner contended that under Section 17 (1) of the Act, the Joint Commissioner of Labour, respondent No.3, who issued the impugned notices, dated 20.07.2010 and 05.08.2010, has no jurisdiction to determine the Wages payable to the employees; that such an objection has to be referred to the Labour Court, but the said objection has not been taken whole heartedly; that invoking the jurisdiction by Joint Commissioner of Labour, under Section 17 (1) of the Act, would come into play only when the determination or adjudication of DA has been adjudicated by a competent authority or a Court of law; that straightaway respondent Nos.6 to 17 invoked the jurisdiction of Joint Commissioner of Labour, who in turn calculated the amount due basing on the Formula prepared by the Manisana Wage Board and the same has been adopted by the Joint Commissioner of Labour and therefore, it is wholly without jurisdiction and hence, he prays to set aside the impugned Notices. 5. On the other hand, learned counsel for the respondents contended that in view of the fact that there is no dispute about the amount payable towards DA, as the Formula has been fixed under the Manisana Wage Board Award, the Joint Commissioner simply followed the Formula; that it is only an arithmetical calculation in arriving at a particular figure; that therefore, for such purpose, the Joint Commissioner can calculate the arrears of DA payable to the employees; that the question with regard to the quantum of DA has not been raised in the petition and hence, he prays to dismiss the Writ Petition. 6. It is not in dispute before this Court that Justice Manisana Wage Board passed an Award on 25.07.2000, whereunder and whereby, a Formula is fixed for ascertaining the DA payable to respondent Nos.6 to 17. Though as per the original Award, the DA has to be paid from the year 1998 onwards, at the same time, as per the settlement arrived in between the parties, under Section 18 (1) of the ID Act, the Award shall be given effect to, from 01.01.2002 onwards. As that has not been implemented, respondent Nos.6 to 17 filed representations, requesting the competent authority that their claim for certain amount may be recovered from the Management of the petitioner under Section 17(1) of the Act. Basing on the representation made by respondent No.6, respondent No.3 issued show-cause notice, dated 24.09.2009, to the petitioner to show cause why the amount claimed should not be recovered from the Management of the petitioner under Section 17 (1) of the Act. In pursuance of this show-cause notice, the petitioner sent a reply, dated 29.01.2010, stating that the calculation of DA was arrived at and paid from 01.01.2002 onwards. So, it is clear that there was a serious dispute with regard to the payment of DA to the employees/working journalists. It is not a mere calculation of amounts basing on a Formula adopted by Manisana Wage Board Award. That has to be determined or adjudicated by a competent authority or Court. When the wage of an employee has been adjudicated or determined by a competent authority or by a Court and thereafter, in case, the employer fails to pay the amount as determined, then only an employee can approach the Joint Commissioner under Section 17 (1) of the Act, who shall issue a certificate for that amount to the Collector, and the Collector shall proceed to recover that amount in the same manner as an arrear of land revenue. 7. On this aspect, the learned counsel for the petitioner placed strong reliance on a Constitution Bench decision of the Honourable Supreme Court in Kasturi and Sons (Private) Ltd. v. N. Salivateswaran[1], wherein it is held thus: “On the other hand, the case for the petitioner is that the section provides for a procedure to recover the amount due from an employer, not for the determination of the question as to what amount is due. The condition precedent for the application of S.17 is a prior determination by a competent authority or the Court of the amount due to the employee from his employer. It is only if and after the amount due to the employee has been duly determined that the stage is reached to recover that amount and it is at this stage that the employee is given the additional advantage provided by S.17 without prejudice to any other mode of recovery available to him. According to this view, the State Government or the authority specified by the State Government has to hold a summary enquiry on a very narrow and limited point: Is the amount which is found due to the employee still due when the employee makes an application under S.17, or, has any amount been paid, and , if yes, how much still remains to be paid? It is only a limited enquiry of this type which is contemplated by S.17. Within the scope of the enquiry permitted by this section are not included the examination and decision of the merits of the claim made by the employee. When the section refers to the application made by the employee for the recovery of the money due to him, it really contemplates the stage of execution which follows the passing of the decree or the making of an award or order by an appropriate Court or authority. In our opinion, the construction suggested by the petitioner should be accepted because we feel that this construction is more reasonable and more consistent with the scheme of the Act.” So, from the above decision it is clear that condition precedent for invoking Section 17 (1) of the Act is that there must be a determination by a competent authority or Court. Admittedly, there is no such adjudication of dispute by a competent authority or Court. 8. The learned counsel for the respondents contended that in view of the fact that DA has to be calculated in pursuance of the Formula fixed in the Award itself, the Joint Commissioner can hold summary enquiry. But, this Court is unable to accept the same. Holding of summary enquiry by a Joint Commissioner comes into play only when there was determination of the wages by a competent authority or Court, and if, in pursuance of that determination, no amount has been paid or if certain amount has been paid, how much amount still remains to be paid to the employee. Therefore, from the above decision it is very clear that the impugned notices are issued by the Joint Commissioner by exercising the powers under Section 17 (1) of the Act. But issuing of such notices under Section 17 (1) of the Act has no application to the present facts of the case because the wage of the employee has not been determined by a competent authority or by Court. Furthermore, it is not a simple calculation of amount of DA based upon the Formula prescribed in the Award itself. As contended by the learned counsel for the respondents, no doubt, a Formula has been prescribed in the Award but that has to be adjudicated basing on the DA payable to an employee. The case of the petitioner herein is that in pursuance of the agreement entered between the Management and the employees, it has already paid the DA to its employees from 01.01.2002 onwards. Whereas, the claim of respondent Nos.6 to 17 is that no DA in pursuance of the Formula prescribed under the Award has been paid to them. So, there is a serious dispute in existence with regard to the payment of wages, namely, DA, to the employees of the petitioner establishment. In such circumstances, it has to be decided by a competent forum. Unless a competent forum decides the issue, the question of issuing certificate or issuing a show-cause notice under Section 17 (1) of the Act does not arise. That stage has not yet come in the present case. Hence, from the above decision it is clear that the Joint Commissioner, who issued the impugned notice and show-cause notice, dated 20.07.2010 and 05.08.2010, respectively, has no jurisdiction to adjudicate the claim except for issuing the certificate. Hence, the impugned notices are liable to be set aside. 9. Accordingly, the Writ Petition is allowed setting aside the impugned notices and leaving open the remedies available to the respondents under law. There shall be no order as to costs. _______________ K.C. BHANU, J June 10, 2011 MD IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD FRIDAY, THE TENTH DAY OF JUNE TWO THOUSAND AND ELEVEN PRESENT THE HON'BLE SRI JUSTICE K.C. BHANU WRIT PETITION No.27008 OF 2010 Between: M/s. Express Publications (Madurai) Ltd. .....PETITIONER AND The Commissioner of Labour and others ....RESPONDENTS The Court made the following: THE HON’BLE SRI JUSTICE K.C. BHANU WRIT PETITION No.27008 OF 2010 June 10, 2011 [1] AIR 1958 SC 507