Case: Cochin State Power, Light Corporation, Limited Vs. Its Workmen

2. The appellant is an electric supply company and its activity is only the distribution of electricity at Ernakulam. It does not generate the electricity which it distributes. There was a settlement between the appellant and its workmen which was arrived at on 25 November 1954. It provided that the settlement would remain in force for a period of five years from 1 October 1954. The settlement was thus to expire on 30 September 1959 but it would continue in force thereafter by virtue of S.19 (2) of the Industrial Disputes Act XIV of 1947 (hereinafter referred to as the Act) unless it was terminated by notice in writing. The case of the appellant is that the settlement was never terminated by notice in writing and therefore it was continuing when the reference was made and so the reference was bad. We are of opinion that there is no force in this contention. The charter of demands was presented to the appellant by the union of its workmen on 14 October 1959. That charter of demands referred to the settlement. It also said that the union on 13 October 1959 had resolved to terminate the existing settlement and submit the charter of demands to the management. Then followed the charter of demands. It is true that in the charter of demands it has not been specifically mentioned in so many words that the settlement was being terminated thereby. There is however no form prescribed for terminating settlements under S.19(2) of the Act and all that has to be seen is whether the Provisions of S. 19 (2) are complied with and in substance a notice is given as required thereunder. In the present case, we are of opinion that the charter of demands itself shows that the union terminated the existing settlement and thereafter submitted a charter of demands to the appellant. That was in our opinion sufficient notice to the appellant in substantial compliance with the provisions of S. 19(2). The objection therefore that the reference was bad in view of the existing settlement most fail.Re : (i).We now come to the specific points raised in appeal. So far as the revision of basic wages is concerned, the contention on behalf of the respondents before the tribunal was that they must be paid the same basic wages as prevailed in the Electricity Board. They also wanted the dearness allowance paid by the appellant to be increased. In this connexion the tribunal noticed the basic wages prevalent in Calicut where also the present appellant is distributing electricity. It seems that in Calicut there was a revision offrom 1 January 1959 and thefixed there were slightly higher than the Ernakulam rates. The tribunal also seems to have taken into consideration the rates prevailing in Cochin municipality as well as in the Trichur municipality where the rates were slightly higher than at Ernakulam. But the tribunal pointed out that the system on which the appellant paid dearness allowance was different from the system prevailing in the Electricity Board as well as in the Cochin and Trichur municipalities and consequently the dearness allowance paid by the appellant was much higher than in the case of these three comparable concerns. It seems that the highest rates of basic wages are being paid by the Electricity Board and that is why the respondent contended that they should be paid the same basic wages as are being paid by the Electricity Board. The tribunal considered this claim of the respondents and disposed it of in these words :"The union contends that they must be paid theprevailing under the Electricity Board and at the same time they want to retain the dearness allowance now given by the management. They want to retain the present dearness allowance and at the same time want to get the scale of pay paid to the Kerala Electricity Board employees. This is too much. If they want the Electricity Board rates they must also be prepared to accept the dearness allowance rates paid by the board."Thus the decision of the tribunal was that the respondents were not entitled to basic wages as paid by the Electricity Board, and at the same time retain the dearness allowance an paid by the appellant which was much higher than the dearness allowance paid by the Electricity Board. It may be mentioned that the respondents claim for increase of dearness allowance was rejected by the tribunal. Even so, the existing dearness allowance in thewas much higher than the dearness allowance paid by the Electricity Board. This being the decision of the tribunal we should have expected that the tribunal if it retained the present dearness allowance would fix rates which may have been higher than the then existing basic wages but which would be lower than the rates prevailing in the Electricity Board. The tribunal went on to say that considering all aspects of the matter it would fixas given in the annexure to the award.

Reasoning:
We are of opinion that there is force in this contention. As we have already said, we should have expected that having come to the conclusion that the respondents were not entitled to thepaid by the Electricity Board, the tribunal would have given basicwhich would be less than those paid by the Electricity Board. Also we should have expected the tribunal to take care to compare the various kinds of staff in thewith their counterparts in the Electricity Board and then fix basicwhich might have been higher than the existingbut should have been lower than theprevalent in the Electricity Board in view of the decision at which the tribunal had already arrived. But the tribunal dose not seem to have taken care to deal with the matter on the lines Indicated above. We may add that some of the designations in theare the same as in the case of the Electricity Board; but some of the designations do not tally. In such cases when the tribunal was making comparison with the Electricity Board and decided to grant rates of basic wages which would be lower than the basicin the Electricity Board for comparable categories, the tribunal should have taken care to point out the comparable categories from the Electricity Board which would correspond to the categories in existence in the appellant concern and then should have fixed the rates in accordance with its decision to the effect that the basic wages in theshould be lower than those in the Electricity Board. It is difficult for us in the circumstances where the categorization is not the same in theas in the Electricity Board to find cut whether the tribunal has given effect to its decision to the effect that the basic wagerates in theshould be lower than those in the Electricity Board. But there are some categories which bear the same name. If we compare the wages fixed in the annexure to the award for such categories with the wages fixed for the same categories in the Electricity Board, we find that in some cases at least the wages fixed in the annexure are higher than the Electricitywill be enough to show that though the tribunal said one thing in the body of the award while arriving at its decision, it does not seem to have kept that decision in mind when framing the annexure to the award. In the circumstances we are of opinion that the tribunal should have dealt with the matter more carefully than it seems to have done. Consequently, as the annexure is prima facie inconsistent with the decision of the tribunal, at least in respect of some categories, it must be set aside and the matter sent back to the tribunal to fix basicin accordance with its decision, which was to the effect that theappeal concern have to be lower than thein the Electricity Board.We may also add that it will be the duty of the tribunal where the designations do not tally to find out what are the comparably designations in the Electricity Board, for it appears that there is a dispute between the appellant and the respondents as to the correct corThe next point is with respect to the special allowance of four annas which the tribunal has granted to what are called street light scouts. It appears from the statement of claim filed by the union that no claim has been made for any special allowance to street light scouts. We hold that street light scouts are reallyand no more. There was thus no claim for any special allowance forwho happened to do the work of what are called street light scouts. Now there is no reference with respect to payment of special allowance to any category of employees; the reference was only with respect to revision of pay scales.Re : (iv).Lastly we come to the question of the retrospective operation of the award. We have already pointed out that the charter of demands was presented on 14 October 1959 and the reference was made on 15 March 1960. The award of the tribunal was given on 22 July 1961. What the tribunal did was to grant the new scales from January 1960. It also provided how the workmen would be fitted in the new grades from 1 January 1960 and directed that in making such fitment if the existing scale of pay was not a step in the new scale they would be fitted in the next appropriate higher step. It further provided that they would be given one increment on 1 January 1960 and another increment on 1 January 1961, over and above the increments under the settlement and would thereafter be given annual increments on 1 January every year. Lastly it provided that in making fitment and giving one additional increment on 1 January 1960 if an employee does not get a minimum of Rs. 5 on 1 January 1960, he will be at least given Rs. 5 increment with effect from 1 January 1960. Thecontention of the appellant is that these provisions in the award with respect to fitment are very onerous and create large liability on the appellant. It is also contended that under the Electricity (Supply) Act 54 of 1948, which governs the appellant, there are very stringent provisions in Sch. VI bearing on financial principles and their application and it will be very difficult after the accounts for the year have been made up to find money consistently with Sch. VI to pay the arrears which are likely to arise on orders of this kind.We are of opinion that there is force in this contention, though it is not necessary for us to pronounce finally on them, for we have set aside the order fixing the basic wages and in consequence the order as to fitment and Increment will also fall. But the tribunal when it fixes basic wages on remand should take into account the provisions in Sch. VI to the Electricity (Supply) Act when deciding from what date to give effect to the award which it shall be making on remand and will keep in mind the difficulties which may arise in the case of a concern like the appellant, which is governed by Sch. VI to the Electricity (Supply) Act.