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1974 DIGILAW 450 (ALL)

Jaggannath v. Union of India

1974-11-05

K.N.SETH

body1974
JUDGMENT K. N. Seth, J. - In this appeal by the plaintiff the only question that arises for consideration is whether the suit was barred under Sec. 22 of the Payment of Wages Act (hereinafter referred to as the Act). The reliefs claimed in the suit were (1) for a declaration that the order of removal of the plaintiff from service was invalid, (2) that a decree for Rs. 5,587.97 be passed as arrears of wages, and (3) that a mandatory injunction be issued directing the defendant to reinstate the plaintiff in service. 2. The trial Court decreed the suit holding that the order dated 13th December, 1967 terminating the plaintiffs service was illegal and ultra vires. A mandatory injunction was also issued commanding the defendant to reinstate the plaintiff in service. The trial court also granted a decree for recovery of the amount claimed as arrears of wages for the period December, 16, 1957 and February 14, 1961. On appeal the learned Additional District Judge held that the suit was not cognizable by the Civil Court and directed that the plaint be returned for presentation to the proper authority. 3. The impugned order of the learned Additional District Judge dated 17-3-1969 is not appealable as a decree. The suit of the plaintiff has not been dismissed. The impugned order is in the nature of an order under Rule 10, Order VII, C. P. C. However, that order would be appealable as an order under Order XLIII, Rule 1(a), C. P. C. and I entertain the present appeal as an appeal from Order. 4. It was urged on behalf of the appellant that the main relief claimed in the suit was for a declaration that the order of his removal from service was illegal and for a mandatory injunction commanding the defendant to reinstate the plaintiff. The relief for payment of salary from the date of his removal from service was incidental to the main relief for declaring the order of removal illegal. It was contended that the cognizance of such a suit was not barred under Sec. 22 of the Act. The relief for payment of salary from the date of his removal from service was incidental to the main relief for declaring the order of removal illegal. It was contended that the cognizance of such a suit was not barred under Sec. 22 of the Act. Sec. 22 of the Act provides : "No Court shall entertain any suit for the recovery of wages or of any deduction from wages insofar as the sum so claimed - (a) forms the subject of an application under Sec. 15 which has been presented by the plaintiff and which is pending before the authority appointed under that section or of an appeal under Sec. 17; or (b) has formed the subject of a direction under Sec. 15 in favour of the plaintiff; or (c) has been adjudged, in any proceeding under Sec. 15 not to be owed to the plaintiff; or an application under Sec. 15." (d) could have been recovered by Section 15 of the Act relates to claims arising out of deduction from wages or delay in payment of wages. The jurisdiction conferred on the Authority to deal with these two categories of claims is exclusive. As pointed out by the Supreme Court in Shri Ambica Mills Co. Ltd. v. Shri S.B. Bhatt, A.I.R. 1961 S.C. 970, 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 the said matters. In determining the scope of these incidental questions care must be taken to see that under the guise of deciding incidental matters the limited jurisdiction is not unreasonably or unduly extended. Care must also be taken to see that the scope of these incidental questions is not unduly limited so as to affect or impair the limited jurisdiction conferred on the authority. The authority under Sec. 15 has jurisdiction to determine what the terms of the contract between the parties are, and if the terms of the contract are admitted and the only dispute is whether or not a particular employee falls within one category or another, that would be incidental to the decision of the main question as to what the terms of the contract are. Where the terms of a contract are admitted and the only point in dispute is which of the two subsisting contracts applies to the particular employee in question the authority has jurisdiction to decide the same. Relying on these observations the learned counsel for the respondent contended that the main question involved in the present case was the claim for recovery of wages and the validity of the order of removal was only incidental which was within the competence of the Authority to decide it, I am unable to agree with this contention. The claim for wages could not possibly be accepted unless it was held that the order of removal of the plaintiff was illegal and invalid. The claim for wages was directly dependant on the claim that the plaintiff had been wrongly and illegally removed from service. Similarly the relief for a mandatory injunction that the plaintiff be reinstated in service could not be held to be a relief ancillary to the relief for payment of wages. 5. Reliance was also placed on certain observations made in the Union of India v. Babu Ram, 1961 A.L.J. 776. A learned single Judge of this Court observed that the Authority under the Act has the jurisdiction to decide whether the relationship of master and servant came into existence or continued to exist even after the order of removal. In deciding this question that Authority can construe the terms of the contract or decide the legality of the order purporting to remove the claimant from service, as the case may be. This power flows from the jurisdiction to determine if any wages are due to the employee. The crucial test for the jurisdiction to determine any question is whether the claimant asks for his wages or damages for wrongful dismissal. If the former, the Authority can decide whether any wages are due or would be due to him if the terms of contract, were fulfilled. It was held that an employee claiming his wages on the ground that the order of his removal was illegal need not have filed a suit at all, for the Authority under the Act had the power to adjudicate upon the legality of the order of removal. It was held that an employee claiming his wages on the ground that the order of his removal was illegal need not have filed a suit at all, for the Authority under the Act had the power to adjudicate upon the legality of the order of removal. It may be pointed out that in this case the Union of India had challenged the decision of the Additional District Judge, Moradabad, dismissing their appeal against an order of the Additional District Magistrate, Moradabad, functioning as Commissioner under the Act, by which be directed the Union of India to pay certain sums as wages claimed by the workman. It appears that Babu Ram was in the employment of the Northern Railway. He was served with an order removing him from service against which he preferred appeals to the competent Authorities which were rejected. Finally he filed a suit for declaration that the order removing him from service was illegal which was decreed and an appeal by the Union of India was dismissed. A second appeal was preferred in this Court and during its pendency Babu Ram applied under Sec. 15(1) of the Act claiming wages for the entire period after his removal. The Railway contested the claim on the ground inter alia that the application was time barred. Babu Ram's application was allowed and he was held to be entitled to his wages. The Commissioner directed the Railway to pay the amount subject to the decision of the Hon'ble High Court in the Second Appeal. On appeal by the Railway under Sec. 17, the Additional District Judge, Moradabad, held that Babu Ram had sufficient cause for not making his application within the prescribed period of six months and condoned the delay. On merits he upheld the decision of the Commissioner but slightly reduced the claim. The Union of India challenged the order of the Additional District Judge under Sec. 115, C. P. C. It appears from the reported decision that the second appeal preferred by the Union of India was ultimately dismissed by this Court. It is obvious that in the aforesaid case the claim of the employee that his order of removal was illegal had been decided by the Civil Court in his favour and the only question before the Authority was with regard to the quantum of the claim as wages. It is obvious that in the aforesaid case the claim of the employee that his order of removal was illegal had been decided by the Civil Court in his favour and the only question before the Authority was with regard to the quantum of the claim as wages. The controversy before the High Court in the revision was whether the learned Additional District Judge had, jurisdiction to condone the delay in preferring the claim. The learned Judge declined to interfere with the discretion exercised by the learned Additional District Judge in condoning the delay. On the facts of the case it is obvious that the Court was not called upon to decide the question whether a civil suit claiming the relief for a declaration that the order of removal of the plaintiff was illegal and also claiming a decree for salary consequent upon the declaration sought was within the competence of the Civil Court. The observations made in the judgment with regard to the scope of the bar imposed by Sec. 22 of the Act were not necessary for the decision of the revision and must be treated as obiter. 6. Reliance was also placed on Ram Prakash Agnihotri v. The Union of India, A.I.R. 1967 Alld. 228. That case related to a claim for wages for the period between dismissal and reinstatement. This Court held that the suit was barred under Sec. 22(d) of the Act. The principle laid down in that case has no application to the facts of the present case where the order of removal itself has been challenged. 7. 228. That case related to a claim for wages for the period between dismissal and reinstatement. This Court held that the suit was barred under Sec. 22(d) of the Act. The principle laid down in that case has no application to the facts of the present case where the order of removal itself has been challenged. 7. The nature and ambit of the jurisdiction of the Authority acting under the Act were fully considered by a Full Bench of the Bombay High Court in Vishwanath Tukaram v. General Manager, A.I.R. 1958 Bombay 111 and it was laid down that (1) the Authority has no jurisdiction to decide whether the services of an employee have been rightly or wrongly terminated or whether the dismissal is lawful or unlawful ; (2) the primary function of the Authority is to determine what the wages of the employee are and whether there has been a delay in the payment of those wages or a deduction from those wages; (3) in order to determine the wages it may be necessary to determine what the terms of the contract were under which the employee was employed and under which he was claiming his wages (4) in order to determine what the contract was, what the terms of the contract were, what were the wages due under the contract, it might become necessary for the Authority to determine whether in the first place there was an employment or not; and (5) when there is dispute as to which is the contract that governs the relationship of the parties and if two rival contracts are in the field, then the Authority under the Act has no jurisdiction to decide which of the contracts should regulate the rights of the parties. The Full Bench approved the principles laid down in Sarin v. Patil, A.I.R. 1951 Bombay 423. Where a Division Bench of the Bombay High Court considered the scheme of the Act and the jurisdiction of the Authority under the Act. 8. In C.V. Narayan Swami Iyer v. K.A. Yasudeya Iyer, A.I.R. 1958 Mad. 360, it was held that under Sec. 22(d) a Civil Court is barred from entertaining a suit for the recovery of wages in so far as the sum so claimed could have been recovered by an application under Sec. 15. 8. In C.V. Narayan Swami Iyer v. K.A. Yasudeya Iyer, A.I.R. 1958 Mad. 360, it was held that under Sec. 22(d) a Civil Court is barred from entertaining a suit for the recovery of wages in so far as the sum so claimed could have been recovered by an application under Sec. 15. The expression `in so far as the sum so claimed as it occurs in Sec. 22, has to be construed with reference to the expression suit for recovery of wages.' So construed Sec. 22 does not contemplate and provide for the splitting up of a claim preferred by an employee in good faith for recovery of a specified sum into its component parts, to verify whether a portion or portions of the claim could have been preferred under Sec. 15(2) of the Act. The test should be, does the suit taken as a whole, on a fair reading of the averments in the plaint amount to a suit for recovery of wages or for the recovery of any deduction from wages within the meaning of Sec. 22 of the Act. In that case a suit was brought by the employee claiming salary for a certain period, daily wages for certain days, leave salary earned by the plaintiff in his service and fifteen days salary in lieu of notice. It was held that the suit being of composite character did not satisfy the test mentioned above, and therefore, the bar imposed by Sec. 22 did not apply and the Civil Court was not divested of its jurisdiction to entertain the suit. 9. I am in respectful agreement with the views expressed in the aforesaid Bombay and Madras decisions. It is not open to the Authority under the Act to adjudicate upon the question whether the services of an employee had been legally or unlawfully terminated. When there is a dispute whether the relationship of employer and employee existed during the relevant period for which the wages are claimed, the dispute can be adjudicated upon only in the Civil Court and not in an application under Sec. 15 of the Act. The Authority, which is a Tribunal of limited jurisdiction and whose powers are controlled by the provisions of the Act, is not competent to determine a controversy which does not fall within the ambit of the provisions of the Act. The Authority, which is a Tribunal of limited jurisdiction and whose powers are controlled by the provisions of the Act, is not competent to determine a controversy which does not fall within the ambit of the provisions of the Act. The jurisdiction of Civil Court is ousted only to the extent that special jurisdiction is conferred upon the special tribunal. Under Sec. 15 of the Act the only claims that can be entertained are claims relating to deductions or delay in payment of wages. It does not extend to determination of the question of validity of the termination of employment of the claimant. The object and scheme of the Act, the nature of jurisdiction conferred and the procedure prescribed preclude the Authority under the Act to entertain complicated questions of law and fact. The Legislative intent could not have been that such questions should be summarily determined by the Payment of Wages Authority under Sec. 15. In view of the nature of the reliefs claimed and the questions involved in the suit giving rise to the appeal, it must be held that the Authority under the Act was not competent to entertain the claim and the Civil Court alone had the jurisdiction to adjudicate upon it. 10. In the result the appeal is allowed with costs. The order of the learned II Additional District Judge, Allahabad, dated 17-3-1969 is set aside. The appeal shall be restored to its original number and decided in accordance with law.