HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH AFR Court No. - 17 Case :- SERVICE SINGLE No. - 719 of 1998 Petitioner :- Central Bank Of India Through R.M. Respondent :- IInd. A.D.J. Gonda and others Counsel for Petitioner :- N.K.Seth, Gopal Kumar Srivastava Counsel for Respondent :- C.S.C.,In Person Hon'ble Sudhir Agarwal,J.
1. Heard Sri Gopal Kumar Srivastava, learned counsel for the petitioner and Sri Radhey Shyam Mishra-respondent no. 3, in person.
2. This writ petition, under Article 226 of the Constitution of India, has come up against the order dated 04.08.1988 passed by Prescribed Authority under Payment of Wages Act, 1936 (hereinafter referred to as the "Act, 1936") read with Section 18 of U.P Shops & Commercial Establishment Act, 1962 (hereinafter referred to as the "U.P. Act, 1962"), claiming bonus for the period of 1986 allowing same with compensation of five times and appellate order dated 05.11.1997 dismissing petitioner's appeal against aforesaid order.
3. Learned counsel appearing for petitioner-Bank has raised two points. Firstly, that the Prescribed Authority under Act, 1936 has no jurisdiction to entertain the said application in the year 1986 since by notification dated 23.05.1985, issued by State Government, all the provisions of U.P. Act, 1962 were exempted in respect of all the Schedule Banks as defined in Reserve Bank of India Act, 1934 (hereinafter referred to as the "Act, 1934"), which included Central Bank of India also. He further submitted that several provisions of U.P. Act, 1962 were exempted by notification dated 15.12.1982 and, therefore, also the U.P. Act, 1962 was not applicable. It is said that there is no notification issued under the provisions of Act, 1936 to apply the same to Central Bank of India, therefore, the impugned orders are patently without jurisdiction. His second point is that as per the Bank's circular dated 05.08.1985 (Annexure-5 to the writ petition) no bonus was payable during period of suspension as provided in Para 12(ii) for the year 1984 and, therefore, also impugned orders are wholly illegal and without jurisdiction.
4. Sri Radhey Shyam Mishra-respondent no. 3, has appeared in person and drew my attention to Section 18 of U.P. Act, 1962 which empowers the Prescribed Authority under Act, 1936 to adjudicate claim of wages payable under U.P. Act, 1962. He further drew my attention to Section 9 of the Payment of Bonus Act, 1965 (hereinafter referred to as the "Act, 1965") stating that under this Act the only disqualification for payment of bonus is a case where the employee is dismissed from service for fraud or riotous or violent behaviour while on the premises of establishment or theft, misappropriation or sabotage of any property of the establishment. He, therefore, submitted that the circular in question, i.e., Annexure-5 to the writ petition, cannot override a statutory provision and since under Act, 1965, for the period of suspension also an employee is entitled for bonus, that amount could not have been denied to respondent-workman and has rightly been allowed by courts below.
5. I have heard the rival submissions and perused the record.
6. The two questions up for consideration in this petition are:
(i) Whether the orders passed by Appellate Authority and Prescribed Authority under Act, 1936 are within jurisdiction?
(ii) Whether respondent no. 3 was disentitled for payment of bonus during the period of suspension in view of Bank's circular dated 05.08.1985 (Annexure-5 to the writ petition)?
7. The Bank is admittedly covered by the term "commercial establishment" as defined under Section 2(4) of U.P. Act, 1962, which reads as under:
"(4) 'commercial establishment' means any premises, not being the premises of a factory, or a shop, wherein any trade, business, manufacture, or any work in connection with, or incidental or ancillary thereto, is carried on for profit and includes a premises wherein, journalistic or printing work, business of banking, insurance, stocks and shares, brokerage or produce exchange is carried on, or which is used as theatre, cinema, for any other public amusement or entertainment or where the clerical and other establishment of a factory, to whom the provisions of the Factories Act, 1948, do not apply, work." (emphasis added)
8. It is also not in dispute that the term 'wages', as defined under Section 2(18) of U.P. Act, 1962, includes amount of bonus. The definition of 'wages' under Section 2(18) of U.P. Act, 1962, reads as under:
"(18) 'wages' means all remuneration (whether by way of salary, allowances or otherwise) expressed in terms of money, or capable of being so expressed, which would, if the terms of employment, express or implied, were fulfilled, be payable to an employee, and includes--
(a) any bonus;
(b) any sum payable to the employee by reason of the termination of his employment; and
(c) any additional remuneration payable under the terms of his employment." (emphasis added)
9. Section 3 makes provisions to certain persons, shops and commercial establishments to which the U.P. Act, 1962 would not apply. Sub-section (3) of Section 3, reads as under:
"3. The provisions of the Act not to apply to certain persons, shops and commercial establishments-
....
(3) Powers of the Government to exempt any class of shops or commercial establishment from the operation of the Act.--The State Government may, in public interest, by notification in the Gazette, exempt, subject to such conditions as it may impose in this behalf, any shop' or commercial establishment or any class of shops or commercial establishments from the operation of all or any of the provisions of this Act." (emphasis added)
10. Learned counsel appearing for petitioner-Bank pointed out that commercial banks situate in State of U.P. were exempted from operation of certain provisions of U.P. Act, 1962 by State Government's notification dated 15.12.1982, issued under Section 3(3) of U.P. Act, 1962. The said notification reads as under:
"Notification No. 3802/XXXVI-3-708-76, dated December 15, 1982 Commercial banks.--In exercise of the powers under sub-section (3) of Section 3 of the U.P. Dookan Aur Vanijya Adhishthan Adhiniyam, 1962 (U.P. Act No. XXXVI of 1962), the Governor is pleased to exempt, in public interest, all commercial banks situated in the state of Uttar Pradesh from the operation of the provisions of Sections 8, 9, 10, 11, 13, 14, 19, 20, 32 and 38 of the said Adhiniyam." (emphasis added)
11. Apparently all the provisions of U.P. Act, 1962 were not exempted and exemption granted was only in respect of Sections 8, 9, 10, 11, 13, 14, 19, 20, 32 and 38. In the present case we are concerned with Section 18 of U.P. Act, 1962, which reads as under:
"18. Recovery of wages-The wages of an employee, if not paid as provided by or under this Act, shall be recoverable in the' manner provided in the Payment of Wages Act, 1936, as if the same wages were payable under that Act."
12. Admittedly Section 18 was not exempted by notification dated 15.12.1982. It leads to the conclusion that despite notification dated 15.12.1982 an employee of Bank, if has not been paid wages by or under U.P. Act, 1962, he can proceed for recovery thereof in the manner provided in Act, 1936, as if the same wages are payable under that Act.
13. It is pleaded that respondent no. 3 was placed under suspension on 25.01.1983 and reinstated on 18.09.1984. On reinstatement he was posted at Partappur, District Auraiya vide transfer order dated 18.09.1984 but did not join thereat and ultimately was dismissed from service on 22.04.1985. The workman claimed bonus for the year 1984 when Section 18 of U.P. Act, 1962 was duly applicable. It is also said that by notification dated 23.05.1985, State Government in exercise of powers under Section 3(3) of U.P. Act, 1962, granted exemption from all the provisions of U.P. Act, 1962 to all the Schedule Banks as defined in Act, 1934. Admittedly, notification dated 23.05.1985 is prospective and has no application to the dispute relating to period earlier to 23.05.1985.
14. An application under Section 15(2) of Act, 1936 was filed by respondent no. 3 on 24.02.1986, which was contested by Bank by filing written statement dated 14.04.1986 in which it had not taken any objection with regard to jurisdiction of Prescribed Authority to entertain the said application. Workman's application was registered as D.C.P.W. 9 of 1986 and Prescribed Authority passed order on 04.08.1988 directing for payment of bonus of Rs. 1600/- for the year 1984 with five times compensation determined to Rs. 8,000/-.
15. The Bank filed appeal registered as M.R.A. 31 of 1988 but therein also no such objection was taken that U.P. Act, 1962 having been exempted from its operation to Bank, Prescribed Authority has no jurisdiction. The reason is quite obvious that the dispute relates to 1984 and at that time all the provisions of U.P. Act, 1962 were not exempted, therefore, Bank's representative before court below did not take any such objection.
16. I thus, have no manner of doubt that in respect of dispute of 1984 Prescribed Authority had jurisdiction to entertain an application under Section 18 of U.P. Act, 1962 read with Section 15 of Act, 1936 and, therefore, the impugned orders cannot be said to lack jurisdiction.
17. Now comes the second question, i.e., application of circular dated 05.08.1985 (Annexure-5 to the writ petition).
18. The workman-respondent no. 3, who has appeared in person and argued with ability, drew attention of this Court to Section 9 of Act, 1965. It says that employer is liable to declare bonus if the amount of bonus declared is higher than the minimum prescribed in Act, 1965 or minimum bonus, as the case may be. Section 8 talks of eligibility for bonus and Section 9 talks of disqualification of bonus. Both reads as under:
"8. Eligibility for bonus-Every employee shall be entitled to be paid by his employer in an accounting year, bonus, in accordance with the provisions of this Act, provided he has worked in the establishment for not less than thirty working days in that year.
9. Disqualification for bonus-Notwithstanding anything contained in this Act, an employee shall be disqualified from receiving bonus under this Act, if he is dismissed from service for--
(a) fraud; or
(b) riotous or violent behaviour while on the premises of the establishment; or
(c) theft, misappropriation or sabotage of any property of the establishment."
19. It is no doubt true that vide order dated 18.09.1984 the petitioner was reinstated. Imposition of punishment of stoppage of three increments permanently was vide order dated 17.09.1984. The following terms and conditions for reinstatement were mentioned in the order dated 18.09.1984:
"1. That the payment of any difference between actual pay and subsistence allowance paid during the period of suspension shall not be paid.
2. That Shri Mishra shall be treated as reinstated in service on the date when he reports for duty at Gonda Branch.
3. That Shri Mishra after reinstatement in service will discharge his duties with utmost sincerity, honesty and devotion.
4. That Shri Mishra should note that on his reporting at Gonda Branch, he will be informed of his further posting."
20. The aforesaid conditions clearly show that for the period of suspension workman was treated in duty but not paid entire salary except the amount of subsistence allowance paid during suspension period.
21. Learned counsel for petitioner-Bank submitted that Bank's circular dated 05.08.1985 disentitled payment of bonus to a Bank employee who was under period of suspension. The disqualification in para 12 of circular dated 05.08.1985 reads as under:
"12. (i) No bonus should be paid to an employee who has been dismissed from the service of the Bank for-
a) fraud;
b) riotous or violent behaviour on the premises of the establishment;
c) theft, misappropriation or sabotage of any property of the establishment.
(ii) Employees under suspension belonging to any category shall not be eligible for any bonus during the period they were under suspension during the year 1984. The employee under suspension will, however, be entitled to bonus for the period he was working in the office (i.e. period he was not under suspension) during the year 1984.
(iii) Those employees who are already under suspension or who are dismissed or discharged from service on account of their involvement in fraud, will not be entitled to any bonus for the year 1984."
22. Relying on para 12(ii) and (iii), learned counsel for the petitioner-Bank submitted that petitioner was not entitled for payment of bonus.
23. In this regard, this Court is of the view that disqualification of bonus is already governed by Section 9 of Act, 1965. No provision of Act, 1965 has been brought to the notice of this Court which entitle employer to add or include some other conditions which may disqualify an employee for bonus, over and above what is prescribed in Section 9 of Act, 1965. In absence of any such provision, circular of Bank, in so far as it exceeds the provisions of Act, 1965, is clearly unauthorized, illegal and without jurisdiction. The said provision made by employer in the teeth of Act, 1965 cannot help employer and deprive an employee from claiming benefit of bonus under Act, 1965, if otherwise it is payable thereunder.
24. It is well settled that the statutory rules cannot be modified or amended by executive orders. In Indra Sawhney and others Vs. Union of India and others, 1992 (Suppl) 3 SCC 217 the Apex Court held that though the executive orders can be issued to fill up the gaps in the rules if the rules are silent on the subject but the executive orders cannot be issued which are inconsistent with the statutory rules already framed. In Laxman Dundappa Dhamanekar and another Vs. Management of Vishwa Bharata Seva Smithi and another, JT 2001 (8) SC 171 also the same view was taken. In K. Kuppusamy and another Vs. State of T.N. and others, 1998 (8) SCC 469 the Court said that statutory rules cannot be overridden by executive orders or executive practice and merely because the government has taken a decision to amend the rules does not mean that the rule stood obligated. So long as the rules are not amended in accordance with the procedure prescribed under law the same would continue to apply and would have to be observed in words and spirit. In Chandra Prakash Madhavrao Dadwa and others Vs. Union of India and others, 1998(8) SCC 154 also the Apex Court expressed the same view holding that the executive orders cannot be conflicted with the statutory rules of 1977.
25. The reliance, therefore, placed on circular dated 05.08.1985 (Annexure-5 to the writ petition) in so far as it is over and above the provisions of Act, 1965, is non-est, void ab initio and will not help the Bank to deny bonus to an employee, who is otherwise entitled under Act, 1965. This question, therefore, is also answered in favour of workman.
26. No other issue has been argued.
27. The above discussion leads to inescapable conclusion that the judgments and orders passed by courts below, impugned in this writ petition, are just, valid and in accordance with law and warrant no interference.
28. The writ petition is accordingly dismissed with costs, which I quantify to Rs. 25,000/-, which shall be paid by petitioner to respondent no. 3-workman within two months from the date of production of a certified copy of this order, failing which the workman may apply to Registrar of this Court, who shall issue a certificate and the amount of cost shall be recovered as arrears of land revenue.
Dt/-30.09.2015 AK