Case: Payment Of Wages Inspector Vs. Surajmal Mehta &amp; Anr

the Authority under the Act had no jurisdiction to enter into a question of potential wages, i. e., where the workman pleads that he ought to have been up-graded as persons junior to him were up-graded and that he ought to have been paid wages on a scale paid to those so up-grade . This Court held that the Authority had jurisdiction to interpret the terms of a contract of employment to find out the actual wages payable to the workmen where deduction from or delay in payment of such wages is alleged, but not to enter into the question whether the workman should have been up-graded from being a daily rated worker to a monthly rated workman. In Shri Ambica Mills Co. Ltd. v. S. B. Bhatt, 1961-3 SCR 220 = (AIR 1961 SC 970 ) this Court again examined the scheme of the Act and held that the only claims which could be entertained by the Authority were claims arising out of deductions or delay made in the payment of wages. The Court, however, observed that in dealing with claims arising out of deductions or delay made in payment of wages the Authority inevitably would have to consider questions incidental to these matters, but in determining the scope of these incidental matters care must be taken to see that under the guise of deciding incidental matters the limited jurisdiction was not unreasonably or unduly expanded. Equally, care must also be taken to see that the scope of these incidental matters was not unduly curtailed so as to affect or impair the limited jurisdiction conferred on the Authority. The Court declined to lay down any hard and fast rule which would afford a determining test to demarcate the field of incidental facts which could be legitimately considered by the Authority and those which could not be so considered.10. It is true, as stated above, that the Authority has the jurisdiction to try matters which are incidental to the claim in question. Indeed Section 15 (1) itself provides that the Authority has the power to determine all matters incidental to the claim arising from deductions from or delay in payment of wages. It is also true that while deciding whether a particular matter is incidental to claim or not care should be taken neither to unduly expand nor curtail the jurisdiction of the Authority. But it has at the same time to be kept in mind that the jurisdiction under Section 15 is a special jurisdiction. The Authority is conferred with the power to award compensation over and above the liability for penalty of fine which an employer is liable to incur under Section 20.11. The question, therefore, is whether on the footing that compensation payable under Sections 25FF and 25FFF of the Industrial Disputes Act being wages within the meaning of Section 2 (vi) (d) of the Act, a claim for it on the ground that its payment was delayed by an employer could be entertained under Section 15 (2) of the Act. In our view it could not be so entertained. In the first place, the claim made in the instant case is not a simple case of deductions having been unauthorisedly made or payment having been delayed beyond the wage periods and the time of payment fixed under Sections 4 and 5 of the Act. In the second place, in view of the defence taken by Respondent 1, the Authority would inevitably have to enter into questions arising under the proviso to Section 25FF, viz., whether there was any interruption in the employment of the workmen, whether the conditions of service under the Board were any the less favourable than those under the company and whether the Board, as the new employer, had become liable to pay compensation to the workmen if there was retrenchment in the future. Such an inquiry would necessarily be a prolonged inquiry involving questions of fact and of law. Besides, the failure to pay compensation on the ground of such a plea cannot be said to be either a deduction which is unauthorised under the Act, nor can it fall under the class of delayed wages as envisaged by Ss. 4 and 5 of the Act.It may be that there may conceivably be cases of claims of compensation which are either admitted or which cannot be disputed which by reason of its falling under the definition of wages the Authority may have jurisdiction to try and determine. But we do not think that a claim for compensation under Section 25FF which is denied by the employer on the ground that it was defeated by the proviso to that Section, of which all the conditions were fulfilled, is one such claim which can fall within the ambit of Section 15 (2).When the definition of wages was expanded to include cases of sums payable under a contract, instrument or a law it could not have been intended that such a claim for compensation which is denied on grounds which inevitably would have to be inquired into and which might entail prolonged inquiry into questions of fact as well as law was one which should be summarily determined by the Authority under Section 15. Nor could the Authority have been intended to try as matters incidental to such a claim questions arising under the proviso to Section 25FF. In our view it would be the Labour Court in such cases which would be the proper forum which can determine such questions under Section 33C(2) of the Industrial Disputes Act which also possesses power to appoint a commissioner to take evidence where questions of facts require detailed evidence.Mr. Shroff, however, drew our attention to the decision in Uttam Chand v. Kartar Singh, 1967-1 Lab LJ 232 (Punj) a decision of a learned Single Judge of the High Court of Punjab, taking a view contrary to the one which we are inclined to take. But that decision contains no reasons and is, therefore, hardly of any assistance.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]The High Court thought that it was not but Mr. Shroff relied on certain decisions of this Court to contest that part of the conclusion of the High Court. The Industrial Disputes Act, which as enacted in 1947 was a piece of legislation which mainly provided machinery for investigation and settlement of industrial disputes, has since then undergone frequent modifications. In 1953, by Act 43 of that year Chapter VA consisting of Sections 25A to 25J was incorporated providing therein compensation for layoff and retrenchment. It also provided a definition of retrenchment in Sec. 2 (oo). Chapter VA, as it then stood, did not expressly provide for compensation for termination of service on account of transfer of an undertaking by an agreement or as a result of operation of law or the closure of the undertaking.It must, however, be remembered that though such compensation falls within the definition of wages, cases may arise where it would not be a simple question of recovery of wages.In the present case, for instance, the defence taken by respondent 1 was that he was not the person responsible for payment of compensation and that the right of the workmen was defeated by reason of the proviso to Section 25FF being, according to him, applicable inasmuch as these workmen were continued in the employment by the said Board, the new employer, that therefore there had been no interruption in their employment, that the terms and conditions of service given to them by the new employer were in no way less favourable than those they had when the company was the employer, and that the new employer was responsible for payment of compensation if any retrenchment took place in future. The question, therefore, is whether in view of the limited jurisdiction of the Authority under Section 15 (2) of the Act, it was intended to deal with such questions, which in some cases might well raise complicated problems of both fact and law.It is explicit from the terms of Section 15 (2) that the Authority appointed under sub-section (1) has jurisdiction to entertain applications only in two classes of cases, namely, of deductions and fines not authorised under Sections 7 to 13 and of delay in payment of wages beyond the wage periods fixed under Section 4 and the time of payment laid down in Section 5. This is clear from the opening words of sub-section (2) of Section 15, namely, "where contrary to the provisions of this Act any deduction has been made or any payment of wages has been delayed. These being the governing words in the sub-section the only applications which the Authority can entertain are those where deductions unauthorised under the Act are made from wages or there has been delay in payment beyond the wage period and the time of payment of wages fixed or prescribed under Sections 4 and 5 of the Act. Section 15 (2) postulates that the wages payable by the person responsible for payment under Section 3 are certain and such that they cannot be disputed.It is true, as stated above, that the Authority has the jurisdiction to try matters which are incidental to the claim in question. Indeed Section 15 (1) itself provides that the Authority has the power to determine all matters incidental to the claim arising from deductions from or delay in payment of wages. It is also true that while deciding whether a particular matter is incidental to claim or not care should be taken neither to unduly expand nor curtail the jurisdiction of the Authority. But it has at the same time to be kept in mind that the jurisdiction under Section 15 is a special jurisdiction. The Authority is conferred with the power to award compensation over and above the liability for penalty of fine which an employer is liable to incur under Sectionour view it could not be so entertained. In the first place, the claim made in the instant case is not a simple case of deductions having been unauthorisedly made or payment having been delayed beyond the wage periods and the time of payment fixed under Sections 4 and 5 of the Act. In the second place, in view of the defence taken by Respondent 1, the Authority would inevitably have to enter into questions arising under the proviso to Section 25FF, viz., whether there was any interruption in the employment of the workmen, whether the conditions of service under the Board were any the less favourable than those under the company and whether the Board, as the new employer, had become liable to pay compensation to the workmen if there was retrenchment in the future. Such an inquiry would necessarily be a prolonged inquiry involving questions of fact and of law. Besides, the failure to pay compensation on the ground of such a plea cannot be said to be either a deduction which is unauthorised under the Act, nor can it fall under the class of delayed wages as envisaged by Ss. 4 and 5 of the Act.