Case: Shell Oil Storage and Distributing Company of India, Limited Vs. Burmah-Their Workmen and Another

Hegde, J.1. In this appeal by special leave against the award made by the additional industrial tribunal, Delhi, the only question that arises for decision in whether the tribunal erred in fixing the age of superannuation of the workmen of the appellant-company at 60 years.2. The tribunal, after examining the material placed before it, came to the conclusion that there is a general trend in Delhi area to raise the age of superannuation of workmen to 60 years. Herein we have two categories of workmen, namely,(i) clerical staff, and(ii) other workmen, such as peons, daftries, drivers, fitters, etc.So far as clercial staff is concerned, there is a pension scheme, which provides for payment of pension to those who are superannuated, the quantum of pension being fixed at 40 per centum of the average basic salary of the workmen concerned during the last five years of his service.3. In the appellant-company, there was no age of superannuation till 1955. Thereafter, the age of superannuation was fixed at 55 years. The age of superannuation thus fixed was not altered in the various agreements entered into between the parties ever since 1955. As mentioned earlier, according to the impugned award, the tribunal has raised the age of superannuation to 60 years. The tribunal rejected the appellants contention that in determining the age of superannuation of its workmen, the comparable concerns to be taken into consideration are the other oil companies only and not the remaining concerns and consequently it did not attach importance to the circumstance that at the time it made the award the age of superannuation of workmen in Caltex was 55 years and that in Esso was 57 years. We may mention at this stage that as per the agreements entered into between the Caltex Company and its workmen on 20 September 1967, the age of superannuation of workmen in the said company has been raised to 58 years. The tribunal also rejected the contention of the appellant that it being an all-India concern it is necessary to have a uniform age of superannuation for its workmen throughout the country. It was said on behalf of the appellant that as per the agreements entered into between the management and its workmen at Bombay and at Calcutta, the age of superannuation of its workmen in those areas had been fixed at 58 years. Sri G. B. Pai, learned counsel for the appellant, offered to apply the same rule to the appellants workmen in the Delhi area.4. The complaint of the appellant was that while fixing the wage-scale and dearness allowance of its workmen, the same tribunal considered the other all companies, particularly Esso, as comparable concerns, but while deciding the age of superannuation it adopted a different standard. This we were told was impermissible.5. As observed by this Court in Dunlop Rubber Company (India), Ltd. v. Its workmen and others [1959 - II L.L.J. 826 at 827-828] :"There is no doubt that in the case of an all-India concern it would be advisable to have uniform conditions of service throughout India it uniform conditions prevail in any such concern, they should not be lightly changed. At the same time it cannot be forgotten that industrial adjudication is based, in this country at least, on what is known as industry-cum-region basis and cases may arise where it may be necessary in following this principle to make changes even where the conditions of service of an all-India concern are uniform. Besides, however, desirable uniformity may be in the case of all-India concerns, the tribunal cannot abstain from seeing that fair conditions of service prevail in the industry with which it is concerned. If, therefore, any scheme, which may be uniformly in force throughout India in the case of an all-India concern, appears to be unfair and not in accord with the prevailing conditions, in such matters, it would be the duty of the tribunal to make be the duty of the tribunal to make changes in the scheme to make it fair and bring it into line with the prevailing conditions in such matters, particularly in the region in which the tribunal is functioning ..."It is not the case of the appellant that there is any uniform age of superannuation for its workmen throughout India. The agreements referred to earlier relate only to Bombay and Calcutta areas. it does not appear that there are similar agreements between the management and the workmen in other areas. Therefore, the fact that the appellant-company is an all-India concern has no significance for our present purpose.6. In fixing the age of superannuation the most important that has to be taken into consideration is the trend in a particular area. That position is made clear by this Court in Talang (G. M.) and others v. Shaw Wallace & Co., Ltd., and other [1964-II L.L.J. 644]. There is no denying the fact that life-expectation has greatly increased in recent years due to healthier living conditions, better food and improved medical facilities though we have still a long way to go in that regard. Under modern conditions, speaking generally, the efficiency of workmen is not impaired till about 60 years. The needs of a workmen are likely to be greater between the age of 50 to 60 years as during that period he has to educate his children, marry his daughters, in addition to maintaining his family. If one looks at the word trend it is obvious that the age of superannuation is gradually pushed up. In some countries it is as high as 70 years. The same trend is where in this country and Delhi area is no exception. From the material placed before the tribunal, it is clear that trend is pronounced in Delhi area.7. We shall proceed to examine the facts established in this case bearing in mind the principles discussed above. But it must also be remembered that this Court does not interfere with the award given by a tribunal unless it suffers from some grave error such as ignoring any important factor that bears on the question under consideration.8. As we said earlier, in the matter of fixing the age of superannuation the trend in a particular area is the most important factor through in the matter of determining the other conditions of service of workmen, the principle of region-cum-industry is by and large the determinative factor.9. In Hindustan Times, Ltd. v. Their workmen [1963-I L.L.J. 108], this Court fixed the age of superannuation of workmen at 58 years. This is the only decision of this Court brought to our notice dealing with the age of superannuation of workmen in the Delhi area. But from the award of the the tribunal, it is seen that in as many as 22 concerns in Delhi area, the age of superannuation of workmen has been fixed either by settlements or by awards at 60 years. In Workmen of Jessop & Co., Ltd. v. Jessop & Co. [1964-I L.L.J. 451], a company situate in West Bengal, this Court fixed the age of superannuation at 58 years. Again in Workmen of Balmer Lawrie & Co., Ltd. v. Balmer Lawrie & Co., Ltd. and another [1964-I L.L.J. 380], a company situated in West Bengal, this Court fixed the age of superannuation at 58 years. That judgment was delivered on 7 November 1963.10. From the various decisions rendered by this Court and by the tribunals, it is obvious that the trend is to raise the age of superannuation. It is also from those decisions that so far as Bombay, Calcutta and Delhi areas are concerned, the trend appears to raise the age of superannuation to 60 years.11. In fixing the age of superannuation, several circumstances have to be taken into consideration, as observed by this Court in Guest, Keen, Williams (Private), Ltd. v. Sterling (P. J.) and others [1959-II L.L.J. 405.]. Speaking for the Court, Gajendragadkar, J. (as he then was), observed therein (at p. 415) :"..... In fixing the age of superannuation industrial tribunals have to take into account several relevant factors. What is the nature of the work assigned to the employees in the course of their employment ? What is the nature of the wage-structure paid to them ? What are the retirement benefits and other amenities available to them ? What is the character of the climate where the employees work and what is the age of superannuation fixed in comparable industries in the same region ? What is generally the practice prevailing in the industry in the past in the matter of retiring its employees ? These and other relevant facts have to be weighed by the tribunal in every case when it is called upon to fix an age of superannuation in an industrial dispute ...."In the instant case, the tribunal did not find that, as compared with other concerns, the wage structure in the appellant-company is unsatisfactory. Taking into consideration the wage structure in other comparable concerns, the wages paid by the appellant-company must be considered as reasonable. As mentioned earlier, so far as clerical staff is concerned, a pension scheme is in operation in the appellant-concern. The tribunal did not find that that scheme is not a fair one. We have ourselves examined the scheme; compared with the pension scheme prevailing either in the Union Government, or in the State Governments, that scheme must be considered as a fair one. So far as the other workmen are concerned, there is no pension scheme. Those workmen are no doubt paid some gratuity at the time of their retirement; but that payment is wholly inadequate to meet their obligations during their retired life. We are told that they are paid fifteen months salary as gratuity. This cannot be considered as an adequate substitute for pension.12. In Imperial Chemical Industries (India) (Private), Ltd., Bombay v. Its workmen [1960-II L.L.J. 716], this Court observed (at p. 719) :"... It is generally recognized in industrial adjudication that where an employer adopts a fair and reasonable pension scheme, that would play an important part in fixing the age of retirement at a comparatively earlier stage. If a retired employee can legitimately look forward to the prospect of earning a pension, then the hardship resulting from early compulsory retirement is considerably mitigated; that is why cases where there is a fair and reasonable scheme of pension in vogue would not be comparable or even relevant in dealing with the age of retirement in a concern where there is no such pension scheme ...."It is true that the pension payable is not adequate to meet the obligations of the superannuated workman. The same is the case with the retired Government servants; probably their position is worse. That is one of the hardships of an undeveloped or a developing country.13. Out of the 22 concerns, which the tribunal considered as comparable concerns in the matter of fixing the retirement age, 20 had no pension schemes. The remaining 2 are the banks and the Imperial Chemicals (India) (Private), Ltd, Company. In those concerns the age of superannuation is 60 years. In addition, they have pension schemes. But, it must be noted that a pension scheme was introduced in the Imperial Chemicals (Private), Ltd., by a settlement after the age of superannuation was raised to 60 years by this Court. In the case of banks also the age of superannuation as well as the pension schemes were settled by settlements between the employers and the workmen. From these two stray instances it is not possible to draw the inference that in the Delhi area there is a trend to fix the age of retirement at 60 years even in the case of companies where there fair pension schemes. Social security for the weaker sections of our nation is of utmost importance. But then we cannot forget the limitations under which we are living. While we should not forget our social goals, our purpose may be defeated if we do not approach our problems in a pragmatic way. It is one thing to settle dispute by agreement, which affects only the interests of the parties to the agreement; it is a quite different thing for this Court to lay down a rule which will have a wider application.14. We are of the opinion that the tribunal failed to attach sufficient significance to the fact that in the appellant company there is a fair pension scheme for the clerical staff and that circumstance distinguished their case from of the other workmen.

Decision reasoning: 0[ds]We have ourselves examined the scheme; compared with the pension scheme prevailing either in the Union Government, or in the State Governments, that scheme must be considered as a fair one. So far as the other workmen are concerned, there is no pension scheme. Those workmen are no doubt paid some gratuity at the time of their retirement; but that payment is wholly inadequate to meet their obligations during their retired life. We are told that they are paid fifteen months salary as gratuity. This cannot be considered as an adequate substitute for pension.Out of the 22 concerns, which the tribunal considered as comparable concerns in the matter of fixing the retirement age, 20 had no pension schemes. The remaining 2 are the banks and the Imperial Chemicals (India) (Private), Ltd, Company. In those concerns the age of superannuation is 60 years. In addition, they have pension schemes. But, it must be noted that a pension scheme was introduced in the Imperial Chemicals (Private), Ltd., by a settlement after the age of superannuation was raised to 60 years by this Court. In the case of banks also the age of superannuation as well as the pension schemes were settled by settlements between the employers and the workmen. From these two stray instances it is not possible to draw the inference that in the Delhi area there is a trend to fix the age of retirement at 60 years even in the case of companies where there fair pension schemes. Social security for the weaker sections of our nation is of utmost importance. But then we cannot forget the limitations under which we are living. While we should not forget our social goals, our purpose may be defeated if we do not approach our problems in a pragmatic way. It is one thing to settle dispute by agreement, which affects only the interests of the parties to the agreement; it is a quite different thing for this Court to lay down a rule which will have a wideris not the case of the appellant that there is any uniform age of superannuation for its workmen throughout India. The agreements referred to earlier relate only to Bombay and Calcutta areas. it does not appear that there are similar agreements between the management and the workmen in other areas. Therefore, the fact that thedia concern has no significance for our present purpose.We are of the opinion that the tribunal failed to attach sufficient significance to the fact that in the appellant company there is a fair pension scheme for the clerical staff and that circumstance distinguished their case from of the other workmen.