Mrs.Kiran Uppal Prop. M/S Clas vs Ashok Kumar & Ors.
2012 Latest Caselaw 3255 Del

*    IN THE HIGH COURT OF DELHI AT NEW DELHI

+            CM No.6323/2006 in W.P.(C) No.11871/2005

%            Judgment reserved on:07th May, 2012
             Judgment delivered on:16th May,2012

MRS.KIRAN UPPAL PROP. M/S CLAS            ..... Petitioner
                  Through : Mr.Vinay Sabharwal, Adv.

                     versus

ASHOK KUMAR & ORS.                       ..... Respondents
                Through : Ms.Kittu Bajaj, Adv.

CORAM:
HON'BLE MR. JUSTICE SURESH KAIT

SURESH KAIT, J.

1. Vide the instant application, filed on behalf of respondent/ workmen under Section 17B of the Industrial Dispute Act, 1947 (hereinafter referred as the ID Act), direction against the petitioner/ management has been sought to pay the minimum wages as applicable from time to time.

2. Ms. Kittu Bajaj, learned Advocate appearing on behalf of the applicant-workman has submitted that the Learned Industrial Tribunal

-II, passed the impugned award dated 10.01.2005, enforceable with effect from 11.03.2005, while holding the termination of the services of the respondent/ workmen was illegal and unjustified, directed the petitioner to reinstate the workmen back in service with 50% back wages.

3. She further submitted, the instant application was filed on behalf of respondent/ workmen Nos.1,4 to 11, 14,17, 19, 21, 22, 24, 27, 30, 32, 33, 39, 43, 45, 47, and 54 to 58. However, during the pendency of instant petition, above mentioned respondents have compromised the matter with the petitioner/management and no more party in these proceedings, barring respondent Nos.8, 21, 22, 24, & 32, who have not compromised the matter and they are contesting the instant petition. It is submitted that the vide impugned award dated 10.01.2005 the management has failed to take the respondents-workman back in service, in compliance of the award which was enforceable with effect from 11.03.2005. The management had belatedly challenged the award which has become final and binding upon the petitioner - management.

4. The respondents/workmen have no other source of income or livelihood and are suffering extremely from financial hardships on account of loss of employment.

5. The respondents are ready and willing to join the duty and for perform work in accordance with the award dated 10.01.2005; however, petitioner-management is adamant, in not taking the respondents/ workmen on duty.

6. Learned counsel submitted, thus, respondents/workmen are entitled to payment of minimum wages, as prescribed by the statute, during the pendency of the writ petition. Moreso, the petitioner/ management obtained ex- parte stay of the effect of the operation of the award dated 10.01.2005, vide order dated 25.07.2005 passed by

this Court.

7. She further submitted that it is a fit case in which the petitioner/management should be directed to take the respondents/workmen in service and also pay their salary and wages. In case the petitioner/ management insist not to take the respondent back on duty, the petitioner should be directed to pay minimum wages as per the revised rates from the date of the award and continue to pay the same till the decision of the writ petition.

8. She has relied upon Ircon International Ltd v. UOI & Ors : 130 (2006) DLT 309 wherein this Court has held in para Nos.20 & 31 as under:-

"20. The jurisdiction to grant interim wages during the pendency of an establishment's challenge to an industrial award granting reinstatement to workman is contained in Section 17B of the Industrial Disputes Act, 1947. The statutory provision reads thus:

'17B. Payment of full wages to workman pending proceedings in higher courts - Where in any case, a Labour Court, Tribunal or National Tribunal by its award directs reinstatement of any workman and the employer prefers any proceedings against such award in a High Court or the Supreme Court, the employer shall be liable to pay such workman, during the period of pendency of such proceedings in the High Court or the Supreme Court, full wages last drawn by him, inclusive of any maintenance allowance admissible to him under any rule if the workman had not been employed in any establishment during such period and an

affidavit by such workman had been filed to that effect in such Court.‟ Provided that where it is proved to the satisfaction of the High Court or the Supreme Court that such workman had been employed and had been receiving adequate remuneration during any such period or part thereof, the Court shall order that no wages shall be payable under this section for such period or part, as the case may be. By judicial expansion, it has been held by the Apex Court that the jurisdiction of the High Court which is seized of a writ petition making such a challenge on behalf of the management, is not confined to the rigors and restrictions laid down under Section 17B. It has also been held that the wages which are awarded to the workman are in the nature of non-refundable subsistence allowance and that equities have to be balanced while considering an application for grant of interim wages. The wages which are amended are not confined to the last drawn wages and the workman however has to establish that he is not gainfully employed in order to be entitled to an order for award of wages.

31. In Taj Services Limited v. Industrial Tribunal - 1 and Ors: 2000 1 LLJ 1012 it has been held that:

6. Workmen can be denied the benefits under Section 17B of the Industrial Disputes Act only when it is proved to the satisfaction of the Court that the workmen have been employed and have been receiving adequate remuneration during the period of pendency of the writ petition. In the case

there is no allegation by the management that they have been employed and have been receiving adequate remuneration during the pendency of the writ petition. Even in the case of the respondent

Nos.2, 4 & 10 the allegation is that they are running their own business but the said allegation is denied by the learned Counsel for the respondents. According to the learned Counsel for the respondents, even if the survival of himself and his family, it will not disentitle the workman for the benefits under Section 17B of the Industrial Disputes Act. The learned Counsel for the respondents also contended that the proviso to Section 17B of the Industrial Disputes Act would be attracted only in the case of the employment under another employer and receiving adequate remuneration. I find force in the contention of the learned Counsel. As per Section 17B the workman is required to file an affidavit to the effect that he had not been 'employed in any establishment'. Hence under the proviso to Section 17B of the Industrial Disputes Act what is required to be proved by the employer is that the workman had been employed in any establishment and had been receiving adequate remuneration from such employment. Being employed for remuneration in an establishment means employment under another employer. It is different from running one's own business or trade in order to remain alive to see the end of the litigation. Hence I accept the contention of the learned Counsel for workmen that respondents 2, 4 and 10 cannot be denied the benefit under Section 17B of the Industrial Disputes Act on the ground that they are running their own business and are receiving profit from such business.

7. At any rate, apart from the averments in the reply of the employer, there is no sufficient material before this Court to come to the conclusion that respondent Nos. 2, 4 and 10 have been running the alleged business. Also there is

nothing to prove that they have been receiving adequate remuneration. Once the workman has filed an affidavit to the effect that he had not been employed in any establishment during the period of pendency of the proceedings in Court, t he onus is on the employer to prove to the satisfaction of the Court that the workman had been so employed and had been receiving adequate remuneration. In this case the employer has not discharged his duty of proving to the satisfaction of this Court that the above mentioned three workmen had been employed in any establishment and had been receiving adequate remuneration during the pendency of the writ petition. Hence I do not find any reason to deny the benefits of Section 17B of the Industrial Disputes Act to the workmen including respondent Nos. 2, 4 & 10."

9. She also relied upon M/s.Birdhi Chand Naunag Ram Jain v. P.O.Labour Court No.IV & Ors : 109(2004) DLT 1 wherein this Court in para No.3 has held as under:-

"3. In any event, self-employment is not a norm for denying back wages as the Section 17-B of the ID Act clearly stipulates employment in an establishment. Respondent No. 3/applicant is clearly not employed in any establishment. If in

enters into a self-employed vocation, it cannot be termed as `employment in an establishment' contemplated by Section 17-B so as to deny him emoluments under Section 17-B of the ID Act. However, therefore the plea of Mr.Sbharwal which merits consideration is that the writ petition was filed in September, 1999 and the application under Section 17-B of the ID Act was filed only on 1st September, 2001. There is no explanation given for

this delay. Accordingly, payment under Section 17- B is not to be made for the period starting from October, 1999 to August, 2001 as the respondent No.3/applicant has failed to give any reason for not filing the application earlier."

10. By summing up, she relied upon Kishan Lal & Sons v. Govt. of NCT of Delhi & Ors : CM No.48/2005 decided on 28.04.2006 wherein this Court in para Nos.63 & 64 held as under:-

"63. The Full Bench of this court in a judgment reported at 2005 V AD (DELHI) 261 DTC vs Jagdish Chander held that the provisions of Section 17B of the Industrial Disputes Act, 1947 will be applicable in a case where the management in the writ petition has challenged the order of the labour court/industrial tribunal whereby its application under Section 33(2)(b) of the Act seeking approval of the order of dismissal of the workman was dismissed by such court or tribunal, subject to the conditions stated in Section 17B itself.

64. The principles laid down in the various judicial pronouncements noticed above for grant of interim relief to a workman can be culled out thus:-

(i) An application under Section 17B can be made only in proceedings wherein an industrial award directing reinstatement of the workman has been assailed.

(ii) This court has no jurisdiction not to direct compliance with the provisions of Section 17B of the Industrial Disputes Act if all the other conditions precedent for passing an order in terms of the Section 17B of the Act are satisfied [Re : (1999) 9 SCC 229 entitled Choudhary Sharai vs

Executive Engineer Panchayati Raj Department & Anr.].

(iii) As the interim relief is being granted in exercise of jurisdiction under article 226 of the Constitution of India, the High Court can grant better benefits which may be more just and equitable on the facts of the case than the relief contemplated by Section 17B. Therefore, dehors the powers of the court under Section 17B, the court can pass an order directing payment of an amount higher than the last drawn wages to the workman (Re : (1999) 2 SCC 106 (para 22) Dena Bank vs Kirtikumar T. Patel

(iv) Such higher amount has to be considered necessary in the interest of justice and the workman must plead and make out a case that such an order is necessary in the facts of the case.

(v) The court can enforce the spirit, intendment and purpose of legislation that the workman who is to get the wages from the date of the award till the challenge to the award is finally decided as per the statement of the objections and reasons of the Industrial Disputes(Amendment) Act, 1982 by which Section 17B was inserted in the act. [Re : JT 2001 (Suppl.1) SC 229 Dena Bank vs Ghanshyam (para 12)].

(vi) An application under Section 17B should be disposed of expeditiously and before disposal of the writ petition [Re : 2000 (9) SCC 534 entitled Workman vs Hindustan Vegetable Oil Corporation Ltd.]

(vii) Interim relief can be granted with effect from the date of the Award [Re: JT 2001 Supplementary

(1) SC entitled Regional Authority Dena Bank vs Ghanshyam; 2004 (3) AD (DELHI) 337 entitled Indra Perfumery Company vs Sudarshab Oberoi vs Presiding Officer.]

(viii) Transient employment and self employment would not be a bar to relief under Section 17B of the Industrial Disputes Act [Re : 2000 (1) LLJ 1012 entitled Taj Services Limited vs Industrial Tribunal ; 1984 (4) SCC 635 entitled Rajinder Kumar Kundra vs Delhi Administration; 109 (2004) DLT 1 entitled M/s Birdhi Chand Naunag Ram Jain Vs. P.O., Labour Court No.IV & Others].

(ix) The court while considering an application under Section 17B of the ID Act cannot go into the merits of the case, the court can only consider whether the requirements mentioned in Section 17B have been satisfied or not and, if it is so, then the court has no option but to direct the employer to pass an order in terms of the statute. It would be immaterial as to whether the petitioner had a very good case on merits (Re : 2000 (5) AD Delhi 413 entitled Anil Jain vs Jagdish Chander).

(x) A reasonable standard for arriving at the conclusion of the quantum of a fair amount towards subsistence allowance payable to a workman would be the minimum wages notified by the statutory authorities under the provisions of the Minimum Wages Act, 1948 in respect of an employee who may be performing the same or similar functions in scheduled employments.[Re: Rajinder Kumar Kundra Vs. Delhi Administration (1984) 4 SCC 635; Sanjit Roy Vs. State of Rajasthan, AIR 1983 SC 328; decision dated 3rd January, 2003 in writ petition(civil) no. 3654 &

3675/1999 entitled Delhi Council for Child Welfare vs Union of India; DTC vs The P.O., Labour Court No. 1, Delhi & Ors. 2002 II AD (Delhi) 112( para 12, 13)]

(xi). Interim orders directing payment to a workman can be made even on the application of the management seeking stay of the operation and effect of the industrial Award and order. Such interim orders of stay sought by the employer can be granted unconditionally or made conditional subject to payment or deposits of the entire or portion of the awarded amount together with a direction to the petitioner employer to make payment of the wages at an appropriate rate to the workman. Such an order would be based on considerations of interests of justice when balancing equities.

(xii) For the same reason, I find that there is no prohibition in law to a direction by the court to make an order directing payment of the wages with effect from the date of the Award. On the contrary, it has been so held in several judgments that this would be the proper course. (Re :Regional Authority, Dena Bank & Anr. vs Ghanshyam reported at JT 2001 (Suppl. 1) SC 229 and Indra Perfumery Co. Thr. Sudershab Oberoi vs. Presiding Officer & Ors. 2004 III AD (Delhi)

337)

(xiii) while passing an interlocutory direction for payment of wages, the court may also secure the interests of the employer by making orders regarding refund or recovery of the amount which is in excess of the last drawn wages in the event of the industrial award being set aside so as to do justice to the employer.

(xiv) A repayment to the employer could be secured by directing a workman to given an undertaking or offer security to the satisfaction of the Registrar (General) of the court or any other authority [Re : para 12, 2002 (61) DRJ 521 (DB) Hindustan Carbide Pvt. Ltd. Vs Govt. of NCT of Delhi & Ors.(supra)]

(xv) in exercise of powers under Article 226 and Article 136 of the Constitution, if the requisites of Section 17B of the Industrial Disputes Act, 1947 are satisfied, no order can be passed denying the workman the benefit granted under the statutory provisions of Section 17B of the Industrial Disputes Act, 1947. [Re: 1999 (2) SCC 106 Dena Bank vs. Kritikumar T. Patel (para 23)].

(xvi) gainful employment of the workman; unreasonable and unexplained delay in making the application by the workman after the filing of the petition challenging the award/order; offer by the employer to give employment to the workman would be a relevant factors and consideration for the date from which the wages are to be permitted.

(xvii) It will be in the interest of justice to ensure if the facts of the case so justify, that payment of the amount over and above the amount which could be directed to be paid under Section 17B to a workman, is ordered to be paid only on satisfaction of terms and conditions as would enable the employer to recover the same. [para 13 of Regional Manager, Dena Bank vs Ghanshyam].

(xviii) The same principles would apply to any interim order in respect of a pendentelite payment in favour of the workman."

11. On the other hand, Mr.Vinay Sabharwal, learned counsel appearing on behalf of petitioner/management has submitted that address furnished by respondent No.22 Kamlesh Kumar is wrong; therefore, petitioner could not verify whether he has been working somewhere or not.

12. Further submitted that all the respondents are working; somehow they have produced the photographs while working in respective establishments. As far as respondent No.22 Kamlesh Kumar is concerned, his employer has issued the employment certificate regarding his employment as Tailor for the period from 01.04.2007 to 22.05.2007 which is Annexure P-2. Regarding the other respondents, the photographs are annexed with the reply to instant application.

13. He has further submitted that the respondents are not entitled for any relief under Section 17 B of the ID Act, and relied upon Dena Bank v. Kritikumar T Patel : (1999) 2 SCC 106 wherein the Apex Court in para Nos.7 & 21 held as under:-

"7. It would be convenient at this stage to set out the provisions contained in Section 17-B of the Act which reads as under:

Section 17-B. Payment of full wages to workman pending proceeding is higher courts. - Where in any case a Labour court, Tribunal or National Tribunal by its award directs reinstatement of any workman and the employer prefers any proceedings against such award in a High Court or the Supreme Court, the employer shall be liable to pay such workman, during the period of

pendency of such proceeding in the High Court or the Supreme Court, full wages last drawn by him, inclusive of any maintenance allowance admissible to him under any rule if the workman had not been employed in any establishment during such period and an affidavit by such workman had been filed to that effect in such Court:

Provided that where it is proved to the satisfaction of the High Court or the Supreme Court that such workman had been employed and had been receiving adequate remuneration during any period or part thereof, the Court shall order that no wages shall be payable under this section for such period or part, as the case may be."

The objects and reasons for enacting the said provisions were as follows:-

"When Labour Courts pass award of reinstatement, these are often contested by an employer in the Supreme Court of High Courts. It was felt that the delay in the implementation of the award cause hardship to the workman concerned. It was, therefore, proposed to provide the payment of the wages last drawn by the workman concerned, under certain conditions, from the date of the award till the case is finally decided in the Supreme Court High courts."

It would thus appear that the object underlying the enacting of the provisions contained in Section 17- B is to give relief to the workman in whose favour an award of reinstatement has been passed by the Labour Court and the said award is under challenge in the High Court of this Court. The said relief has been given with a view to relieve the hardship that would be caused to a workman on account of delay in implementation of the award as

a result of the pendency of the proceedings in the High Court or this Court. The question for consideration is: what is the extent to which such relief has been granted to a workman under this provision? The objects and reason do not indicate an answer to this question and its answer has to be found in the provisions of the enactment. Since the expression "full wages last drawn" in Section 17-B has been construed by the various High Court in the decisions referred to above we would briefly refer to the same.

21. As indicated earlier Section 17-B has been enacted by Parliament with a view to give relief to a workman who has been ordered to be reinstated under the award of a Labour Court or the Industrial Tribunal during the pendency of proceedings in which the said award is under challenge before the High Court or the Supreme Court. The object underlying the provision is to relieve a certain extent the hardship that is caused to the workman due to delay in the implementation to the workman is in the nature of subsistence allowance which would not be refundable or recoverable from the workman even if the award is set aside by the High Court or this Court. Since the payment is of such a character Parliament thought it proper to limit it to the extent of the wages which were drawn by the workman when he was in service and when his services were terminated and therefore used the words "full wages last drawn". To read these words to mean wages which would have been drawn by the workman if he had continued in service if the order terminating his services had not passed since it has been by the award of the Labour of Industrial Tribunal, would result in so enlarging the benefit as to comprehend the relief that has been granted under the award

that is under challenge. Since the amount is not refundable or recoverable in the eventuality of the award being set aside it would result in the employer being required to give effect to the award during the pendency of the proceeding challenging the award before the High Court or the supreme Court without his being able to recover the said amount in the event of the awarded being set aside. We are unable to constitute the provisions contained in Section 17-B, to cast such a burden on the employer. In our opinion, therefore, the words "full wages last drawn" must be given their plain and material meaning and they cannot be given the extended meaning as given by the Karnataka High Court Visveswarya Iron & Steel Ltd. [supra] or the Bombay High Court in Carona Sahu Co. Ltd. [supra]."

14. He further relied upon Dena Bank v. Ghanshyam : (2001) 5 SCC 169 wherein the Apex Court in para Nos. 5 & 13 held as under:-

"5.The short question that arises for consideration is : whether the order of the High Court directing payment of regular salary payable on reinstatement as on the date of the order to the respondent, which is over and above full wages last drawn occurring in Section 17-B of the Act, is sustainable.

13. It must, however, be pointed out that while passing an interlocutory order the interests of the employer should not be lost sight of. Even though the amount paid by the employer under Section 17- B to the workman cannot be directed to be refunded in the event he loses the case in the writ petition, [See : Dena Banks case (supra)] any amount over and above the sum payable under the said provision, has to be refunded by him. It will, therefore, be in the interests of justice to ensure, if

the facts of the case so justify, that payment of any amounts over and above the amount payable under Section 17-B to him, is ordered to be paid on such terms and conditions as would enable the employer to recover the same."

15. In rejoinder, learned counsel for respondent submitted that the photographs produced on behalf of petitioner does not establish that the applicants/workmen are self - employed or employed with any other establishment. Moreover, petitioner has taken ex-parte stay against the impugned award by suppressing material facts. There is no imbargo to grant relief under Section 17B, even the stay being granted.

16. I have heard learned counsel for parties and gone through the material available on record including the case law relied upon by them.

17. The law has been settled in case of Ircon International Ltd. (Supra) that if the Tribunal has passed award and directs the reinstatement of any workman and the employer prefers any proceedings against such award in a High Court or the Supreme Court, the employer shall be liable to pay such workman, during the period of pendency of such proceedings in the High Court or the Supreme Court, full wages last drawn by him, inclusive of any maintenance allowance admissible to him under any Rule, if the workman had not been employed in any establishment during such period and an affidavit by such workman had been filed to that effect in such Court.

18. In the present case, the workmen have established their case that they have not been in an employment during this period, and to this effect they have filed affidavits also.

19. I am conscious of the fact that if the satisfaction has been by the High Court or Supreme Court that such workmen had been employed and had been receiving 'adequate remuneration' during any such period or part thereof, the Court shall order that no wages shall be payable under this section for such period or part, as the case may be.

20. However, the indictment given in Ircon International Ltd. (supra) the Apex Court that the jurisdiction of the High Court which is seized of a writ petition making such a challenge on behalf of the management, is not confined to the rigors and restrictions laid down under Section 17(b) of the Industrial Disputes Act.

21. It has been held that the wages which are awarded to the workman are in the nature of non-refundable subsistence allowance and that equities have to be balanced while considering an application for grant of interim wages. The wages which are amended are not confined to the last drawn wages. The workman however has to be establish that he is not gainfully employed in order to be entitled to an order for award of wages.

22. The petitioners' allegations are, as mentioned in their response to the instant application that they are running their own business, or they are self-employed and working with some other establishment, but the said allegation has been denied by the learned counsel for the

applicant-respondents. It is submitted, even if it is, for the survival of himself and his family, it will not dis-entitle the workman for the benefit under Section 17(b) of the Industrial Disputes Act. The Court has to see that the employment under another employer should be proved that the workman has been receiving 'adequate remuneration'.

23. In case of Taj Services Limited (Supra) held that the benefit under Section 17(b) of the Industrial Disputes Act cannot be denied on the ground that they are running their own business and are receiving profit from such business. Until and unless, it is proved that they have been receiving „adequate remuneration', the petitioners in the present case have not furnished the proof of 'adequate remuneration'.

24. It is decided in case of 'Kirti Kumar T Patel' that the Court can enforce the spirit intentment and purpose of litigation that the workman who is to get the wages from the date of award till the challenged to the award is finally decided as per the statement of the objects and reasons of the Industrial Disputes (Amendment Clauses) Act, 1982, by which Section 17(b) was inserted in the Act. The interim relief can be granted with effect from the date of the award. The transient employment and self-employment would not be a bar to relief under Section 17(b) of the Industrial Disputes Act.

25. In view of the discussion above and the settled law, I am of the considered opinion that the applicant-respondents are entitled to the relief sought under Section 17(b) of the Industrial Disputes Act.

26. Accordingly, the instant application is allowed.

27. Consequently, the petitioners are directed to calculate their benefits and be disbursed in favour of the applicant-respondents as per law, within four weeks from today.

28. Copy of order be given dasti to both the parties for compliance.

+ W.P.(C) No.11871/2005 & CM No.8814/2005(Stay)

Pleadings are complete.

Rule.

Re-notify for 'Final-hearing' on 26.09.2012.

SURESH KAIT, J

MAY 16, 2012 Mk/P