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1974 DIGILAW 391 (ALL)

Shiv Kumar Gaur, Manager, Bijli Cotton Mills v. R. B. Lal Inspector of Factories

1974-09-19

G.C.MATHUR

body1974
JUDGMENT G. C. Mathur, J. - These five revisions and five writ petitions arise out of five applications under Sec. 15 (2) of the Payment of Wages Act, 1936 made by the Inspector of Factories, Agra Region, against the Bijli Cotton Mills, Hathras. 2. The Inspector made inspection of the factory premises on five different dates, namely, August 12, 1966, October 11, 1966, April 12, 1967, May 11, 1967 and June 23, 1967. On each inspection he found that the wages of certain number of workmen for the previous months had not been paid though they should have been paid by the tenth of the month. He accordingly filed applications under Sec. 15(2) of the Act, before the Sub-Divisional Magistrate, Hathras, who was the authority under the Payment of Wages Act, for the payment of the delayed wages. The applications in respect of the delay in payment of wages found on these inspections, were received by the Sub-Divisional Magistrate on September 9, 1966, October 29, 1966, April 22, 1967, May 24, 1967 and July 1, 1967, respectively. The applicant who is the Manager of the Mills, filed a written statement, contending that the delay in the payments was due o the fact that there was failure in the supply of electricity on account of which the mills suffered heavy losses. He further contended that the wages were paid soon after the visits of the Inspector of Factories. The Sub-Divisional Magistrate held in all the five cases that there were no exceptional circumstances beyond the control of mills for the delay in the payment of Wages. It further held that the payment of wages had been made after inspect on and there was no case for the issue of directions for payment of delayed wages. But he was of opinion that since the payment was delayed causing financial hardship to the workers, it was a fit case for the payment of compensation. He accordingly directed, in each case, the mills to pay compensation at the rate of Rs. 10/- per worker the payment of whose wages had been delayed. Against these orders of the Sub-Divisional Magistrate, the applicant filed appeals before the D strict Judge. All those appeals were dismissed on the ground that the applicant had failed to deposit the amount of compensation directed by the Sub-Divisional Magistrate to be paid to the workers. 10/- per worker the payment of whose wages had been delayed. Against these orders of the Sub-Divisional Magistrate, the applicant filed appeals before the D strict Judge. All those appeals were dismissed on the ground that the applicant had failed to deposit the amount of compensation directed by the Sub-Divisional Magistrate to be paid to the workers. Against the orders of the District Judge, five civil revisions were filed in this Court. Subsequently, five writ petitions were filed under Article 227 of the Constitution of India, challenging the order of the Sub-Divisional Magistrate as well as of the District Judge. Since identical questions of law and fact arise in all the cases, they can conveniently be disposed of by one judgment. 3. The only point urged by Sri V. K. Barman, learned counsel for the applicant-petitioner, is that the payment of Wages Authority had no jurisdiction to direct payment of compensation as the delayed wages had been paid before the applications under Sec. 15(2) of the Act were filed. This contention involves two questions, namely, (1) whether the Payment of Wages Authority has jurisdiction to direct payment of compensation for delay in payment of wages when the delayed wages have been paid before the filing of applications under Sec. 15 (2); and (i) whether in these cases the delayed wages had, in fact, been paid before the filing of the applications under Sec. 15(2). These questions were not raised before lie Sub-Divisional Magistrate. I have permitted these questions to be raised in these cases for the first time in this Court as is a question of the jurisdiction of Payment of Wages Authority. 4. It will be convenient to consider the question of law first. The relevant part of Sec. 15 (2) reads thus: "Where contrary to the provisions of this Act any deduction has been made from the wages of an employed person, or any payment of wages has been delayed, such person himself...... or any Inspector under this Act,.... may apply to such authority for a direction under sub-sec. (3)." The provisos to this subject on lay down the limitation of 12 months for presenting an application under Sec. 15 (2). The relevant part of sub-sec. (3) is in these words:- "When any application under sub-sec. (2) is entertained, the authority shall hear the applicant and the employer .... may apply to such authority for a direction under sub-sec. (3)." The provisos to this subject on lay down the limitation of 12 months for presenting an application under Sec. 15 (2). The relevant part of sub-sec. (3) is in these words:- "When any application under sub-sec. (2) is entertained, the authority shall hear the applicant and the employer .... and, after such further enquiry (if any) as may be necessary may .... direct the refund to the employed person of the amount deducted, or the payment of the delayed wages, together with the payment of such compensation as the authority may think fit, not exceeding ten times the amount deducted in the former case and (not exceeding twenty five rupees in the latter, and even if the amount deducted or the delayed wages are paid before the disposal of the application, directed the payment of such compensation, as the authority may think fit, not exceeding twenty-five rupees)." The words within (.....................) were substituted in 1964 for the words "not exceeding Rs. 10/- in the latter". The argument is that the payment of compensation can only be directed when there is a direction either to refund the deducted wages or to pay the delayed wages. Emphasis is laid on the words "together" in sub-sec. (3) and it is urged that compensation can only be awarded "together" with the refund of deducted wages or payment of delayed wages. Independently of the direction for refund of deducted wages or for the payment of delayed wages, no direction for payment of compensation can be made. 5. The question first arose before the Bombay High Court in Chimanlal (Ishwarlal Mahta v. Junior Inspector of Factories, A.I.R. 1942 Bombay 273. The question was answered in the negative and it was observed : "In my opinion, this sub-section on means that the order for compensation could be passed along with the order for the payment of delayed wages; but there could not be any order for the payment of delayed wages they were paid before the application was made. I do not think it is open to the applicant to apply for a direction for the payment of delayed wages, and it is only in such an application that the authority might pass an order for compensation along with the order for payment of delayed wages. I do not think it is open to the applicant to apply for a direction for the payment of delayed wages, and it is only in such an application that the authority might pass an order for compensation along with the order for payment of delayed wages. I can only say that if it was the intention of the legislature that an application for compensation alone could be preferred after the payment of delayed wages, it has not used appropriate words in the section. The only construct on that I can put on the section is that an order for compensation could be made along with the order for the wages, but not by itself, and that, therefore, an application for compensation alone is not competent. In my view, therefore, the Magistrate had no jurisdiction to entertain the application for compensation." 6. In Chief Inspector of Factories, U.P. v. V.K. Modi, A.I.R. 1952 Allahabad 804, Desai, J., as he then was, took the same view and held : The language of Sec. 15 makes it clear that an order of payment of compensation alone is beyond the jurisdiction of a Magistrate. If compensation can be ordered to be paid, it can be ordered to be paid only along with the wages. If no wages are ordered to be paid, no compensation also can be ordered to be paid." In this case also, the delayed wages had been paid before the application under Sec. 15 (2) was filed. 7. In Cachar Chah Sramik Union v. S.K. Datta, Director, Chincoorie T.E., A.I.R. 1960 Assam 26, the delayed wages were paid after the application under Sec. 15 (2) had been filed. Still following the above two cases, the Assam High Court held that a direction for payment of Compensation alone could not be made. It observed : "It would thus appear that compensation alone could not be claimed and the authority, while directing payment of delayed wages, could also grant such compensation as it thought fit. A mere direction for payment of compensation could not be given by the authority." 8. A different view was taken by the Patna High Court in Manager, Searchlight Press, Patna v. The Factories Inspector, Patna, A.I.R. 1960 Patna 33. In this case also, the delayed wages were paid after the application under Sec. 15 (2) had been filed. A mere direction for payment of compensation could not be given by the authority." 8. A different view was taken by the Patna High Court in Manager, Searchlight Press, Patna v. The Factories Inspector, Patna, A.I.R. 1960 Patna 33. In this case also, the delayed wages were paid after the application under Sec. 15 (2) had been filed. The learned Judges did not agree with the view of Desai, J. and held that the authority was empowered to award compensation alone if it thought fit. It was observed in this case. "When once the default has occurred and action has been taken in accordance with the provisions of the Act, I do not see why the payment of compensation cannot be allowed, if, in the meantime, the deductions from the wages have been made good or delayed wages have been paid. It is the delay or the unauthorised deduction which subjects the employer to penalty provided in sub-sec. (3) and subsequent payment, in my opinion, is not sufficient to exonerate the employer from payment of compensation in the absence of any satisfactory explanation." 9. It is now unnecessary to consider whether the view taken by the Assam High Court or by the Patna High Court in respect of cases where the deducted wages or the delayed wages are paid after the filing of the application under Sec. 15 (2), is correct. The matter is now covered by the amendment of sub-sec. (3) in 1964. The amendment now specifically provides that if the deducted wages or the delayed wages are paid before the disposal of the application under Sec. 15 (2), the authority may direct the payment of such compensation as it thinks fit. But the question whether the authority has any jurisdiction to direct payment of compensation where the deducted wages or the delayed wages are paid before the filing of the application under Sec. 15 (2), still remains for consideration. On this question I see no reason to differ from the view taken by the Bombay High Court and by Desai, J. in this Court. 10. An application under Sec. 15(2) can only be made in two contingencies, that is to say, when there is a deduction in the wages or there is delay in the payment of wages. The sub-section is directed towards recovery of such wages. 10. An application under Sec. 15(2) can only be made in two contingencies, that is to say, when there is a deduction in the wages or there is delay in the payment of wages. The sub-section is directed towards recovery of such wages. If may be said that the cause of action for making the application under Sec. 15(2) is the deduction in wages or the delay in payment of wages. This cause of action must subsist at the time when the application under Sec. 15(2) is made. It follows that if the payment has already been made, then the cause of action disappears and no application under Sec. 15(2) can be filed. The matter can be looked at from another angle. The authority has been conferred a power to direct payment of compensation if it finds that the employer has either deducted wages or has made delay in the payment of wages. It is not a case where a right to compensation accrues immediately to the worker on the deduction or delay being made by the employer. I am unable to agree with the Patna High Court that the employer becomes liable to a "penalty" when there is delay or un-authorised deduction in wages. No right accrues at the time there is deduction or delay to the workmen to obtain compensation. There is only a power in the authority to direct payment of compensation when a case complaining of deducted wages or delayed wages come before it. Once the deducted wages or the delayed wages have been paid, there is no right left in the workmen or other persons enumerated n sub-sec. (2) to approach the authority under Sec. 15 (2). 11. It was urged by the learned Chief Standing Counsel that the words "even if the amount deducted or the delayed wages are paid before the disposal of the application", introduced in 1964, are wide enough to cover a case of payment before the filing of the application under Sec. 15(2). I am unable to agree with this. These words have to be read with the opening words of sub-sec. (3) which are "when any application under sub-sec. (2) is entertained." So read, it is clear that the words "before the disposal of the application" mean after the application under sub-sec. I am unable to agree with this. These words have to be read with the opening words of sub-sec. (3) which are "when any application under sub-sec. (2) is entertained." So read, it is clear that the words "before the disposal of the application" mean after the application under sub-sec. (2) is entertained and before its disposal, that is to say, during the pendency of the application under Sec. 15(2). I am, therefore, of opinion that if the deducted wages or the delayed wages are paid before the filing of the application under Sec. 15(2) no application can be filed for a direction for payment of compensation alone. 12. It now remains to consider the question of fact whether in all these cases or in some of them, the delayed wages were paid up before the applications under Sec. 15 (2) were received by the Sub-Divisional Magistrate, Hathras. As already observed above, the question was not raised before the authority and there is no finding on this question in the orders of the authority, But the applicant had pleaded before the authority that payment of the delayed wages had been made shortly after the inspections and the authority has also observed that the payments of the wages had been made after the inspection. It is on this finding that no order for payment of the delayed wages was passed by the authority and only a direction for payment of Compensation was given. In this Court, the applicant has filed supplementary affidavits in the writ petitions giving the dates on which the payments were made in each case. In the counter-affidavits, the averment regarding the dates of the payment has not been accepted on the ground that the relevant registers are not available. In my opinion, since from the very beginning, it was pleaded that payment had been made shortly after the inspections, these are fit cases in which the authority should be directed to investigate this question. On the basis of the orders of the authority in the five cases, a huge amount is payable by the applicant on account of compensation. If it is a fact that the delayed wages to any of the workmen were paid before the date when the applications under Sec. 15 (2) were received by the authority then there would be no Liability on the applicant to pay compensation to such workmen. If it is a fact that the delayed wages to any of the workmen were paid before the date when the applications under Sec. 15 (2) were received by the authority then there would be no Liability on the applicant to pay compensation to such workmen. According to the supplementary affidavits themselves, it appears that some parts of the delayed wages were paid to some of the workmen either on the dates the applications under Sec. 15(2) were made or sometime thereafter but that a major part of the delayed wages were paid before the dates on which the applications were received by the authority. It is necessary that the question about the dates of these payments be investigated by the authority as a finding in favour of the applicant will oust the jurisdiction of the authority to direct payment of compensation. 13. The revisions and writ petitions are accordingly allowed and the orders of the Sub-Divisional Magistrate, Hathras, in the five cases are set aside. The Sub-Divisional Magistrate will, after giving the parties a fresh opportunity of being heard, determine the question as to on what dates the delayed wages were paid to the workmen concerned and whether, in the light of the law as clarified above, any directions should be issued to the applicant to pay compensation and at what rates and to which workmen. In the circumstances of these cases, parties will bear their own costs of these revisions and the writ petitions.