Manager, M/s. Ibrahimji Isabhai v. Authority, under Minimum Wages Act
1995-03-16
R.D.SHUKLA, R.S.GARG
body1995
DigiLaw.ai
JUDGMENT R.S. Garg, J. -- 1. This is a Letters Patent Appeal under Clause 10 of the Letters Patent against the order dated 6.3.1985 passed in M.P. No. 357 of 1983 by Hon'ble Shri V.D. Gyani, J. confirming the order dated 13.1.83 passed by the Authority .under the Minimum Wages Act, 1948, Ujjain in Case No.3 of 81. 2. The brief facts in the nut-shell are that Mazdoor Sabha Ujjain, which is a registered Trade Union, for and on behalf of its five members filed an application under S. 20 of the Minimum Wages Act (hereinafter referred to as 'the Act') stating therein that the Manager of M/s Ibrahimji Isabhai and Sons has not paid the proper wages to the respondents Nos. 2 to 6. It was also alleged that the difference of the minimum wages for the period between January 79 to June 1991 be directed to be paid to respondents Nos. 2 to 6 in view of the Notification dated 7.12.1978. The appellant (original non-applicant) filed before the Authority inter alia contending that the claimants were not entitled to the alleged difference so also it was submitted that the Authority under the Minimum Wages Act had no jurisdiction to decide the classification as according to the appellant the matter related to classification of the employees into skilled, semi-skilled or unskilled worker. The Authority after recording the evidence and hearing the parties held that the case in relation to Shabbir Hussain does not need any decision as neither he appeared before the Authority nor did he lead any evidence in support of his claim. It held that it had the jurisdiction in relation to classification of the employees because that being a matter incidental to the decision of the question of the payment of minimum wages and ultimately it held that the four claimants, namely Hakimuddin, Kadarbhai, Ashokrao and Girishkumar were entitled to sum of Rs. 1020/-, Rs. 1494/-, Rs. 843/- and Rs. 969/- respectively. Being aggrieved by the said order, dated 13.1.83 passed in Case No.3 of 81 by the Authority, the appellant filed M.P. No. 357 of 1983. 3. It was contended before the learned Single Judge that the respondent No. 1 without deciding the preliminary objection as to its jurisdiction regarding classification recorded the evidence and passed the order on 13.1.1983.
Being aggrieved by the said order, dated 13.1.83 passed in Case No.3 of 81 by the Authority, the appellant filed M.P. No. 357 of 1983. 3. It was contended before the learned Single Judge that the respondent No. 1 without deciding the preliminary objection as to its jurisdiction regarding classification recorded the evidence and passed the order on 13.1.1983. The Hon'ble Single Judge by its order dated 6.3.1985 dismissed the petition holding that the order dated 13:1.83 was passed exercising the jurisdiction properly. 4. Shri S.S. Samvatsar appearing for the appellant contended that the Authority was not competent to classify the employees as skilled, semi-skilled or unskilled. It was also submitted that the jurisdiction vested in the Authority under S. 20 of the Act is summary in nature and it was beyond the scope of the Authority to make any such classification. According to him the Authority exceeded its jurisdiction. Reliance was placed on C.S. Parameswaran v. Authority, Minimum Wages Act (1970 Lab. I.C. 315) which holds that the Authority constituted under S. 20 cannot decide the question of classification of workmen. 5. A perusal of the application filed under S. 20 (3) of the Act would show that no dispute in relation to the classification was raised by the original applicant. It was the present appellant who by way of his preliminary objection submitted that the claimants were classified according to their seniority, nature of work, suitability and ability of the concerned employee to do a particular job. In their reply it was also contended that so long as the classification is not challenged or decided otherwise, the classification made by non-applicant (appellant) is correct at its place. The preliminary objection further reads that the Authority is not competent and has no jurisdiction to do the classification, therefore, the application filed by the applicants (respondents No.2 to 6) cannot be entertained. 6. In A.V. D'Costa v. B.C. Patel (AIR 1955 SC 452) the Supreme Court has observed as under: "....... it may be open to the authority to decide the controversy and find out what the terms of the contract with reference to those letters were. But, if an employee were to say that his wages were Rs.
6. In A.V. D'Costa v. B.C. Patel (AIR 1955 SC 452) the Supreme Court has observed as under: "....... it may be open to the authority to decide the controversy and find out what the terms of the contract with reference to those letters were. But, if an employee were to say that his wages were Rs. 100 per month which he actually received as and when they fell due, but that he would be entitled to higher wages if his claims to be placed on the higher wages scheme had been recognised and given effect to, that would not be a matter within the ambit of his jurisdiction. The authority has the jurisdiction to decide what actually the terms of the contract ....... were ..... but the authority has no jurisdiction to determine the question of potential wages." In Shri Ambika Mills Co. v. S.B. Bhatt ( AIR 1961 SC 970 ) in reference to the Payment of Wages Act, the Supreme Court has said: "......... 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." In 1970 LabIC 815 (C.S. Parameswaran v. Authority Minimum Wages Act) the Bombay High Court has clearly said that it is within the jurisdiction of the Authority to decide on such questions as necessarily arise in relation to the contract of employment. 7. In the matter of Bahadursingh Birsingh v. C.P. Fernandes (AIR 1955 Bombay, 95) the Bombay High Court held that the jurisdiction of the Authority was summary in nature, it could not go into the question whether the employee worked overtime or not and which fact was not admitted by the employer. It was further held that the Authority had jurisdiction to determine to which class of the scheduled employment the applicants belong, what are the minimum rates prescribed for that employment, which minimum rate applies to them, whether the payment has been made of less than the minimum rates and whether the employer was justified in not making payment at the rate demanded by the employees.
In exercise of that jurisdiction the Authority has also to decide whether the claimants had worked overtime and whether they were paid at the overtime rate then in force. Thus, matters even according to Parameswaran's case (supra) which legitimately fall within the ambit of minimus wages Act must necessarily be decided by the Authority. The question as to whether an employee belong to one employment or other will depend upon the terms of the contract which the Authority would have jurisdiction to decide and it is on the denial of the contract that the question of the application of the schedule could possibly arise. Parameswaran's judgment does not put an absolute no to the jurisdiction of the Authority. It merely says that if a pure and simple question of classification arises then the Authority under the Act S. 20 would have no jurisdiction. 8. According to S. 20 (2) of the Act where an employee has any claim of the nature referred to in sub-section (1), he may apply to such authority for direction under sub-section (3). According to sub-section (3) when any application under sub-section (2) is entertained the Authority shall hear the applicant and the employer, or give them an opportunity of being heard, and after such further inquiry, if any, as it may consider necessary, may, without prejudice to any other penalty to which the employer may be liable under the Act, direct in the case of a claim arising out payment of less than the minimum rates of wages, the payment of the employee of the amount by which the minimum wages payable to him exceed the amount actually paid, together with the payment of such compensation as the Authority may think fit, not exceeding ten times of amount of such excess. 9. It is to be noted that the moment an application under S. 20 is made under the provisions of the Act a notice is to be issued to the employer so that he may appear before the Authority and put forth his objections to the claim. If an objection regarding classification is raised then obviously it would be within the jurisdiction of the Authority to decide it prima facie as to whether it had the jurisdiction or not. If only on the objections the Authority is called upon to stay its hands then it would create a chaotic condition.
If an objection regarding classification is raised then obviously it would be within the jurisdiction of the Authority to decide it prima facie as to whether it had the jurisdiction or not. If only on the objections the Authority is called upon to stay its hands then it would create a chaotic condition. Every employer by raising a dispute whether genuine or frivolous will compel the authority not to proceed further in the matter. As said by the Supreme Court the matters incidental or arising for just determination even under S. 20, the Authority is duty bound to answer certain basic questions. The Authority certainly be called upon to decide the question as to whether the classification put forth by the employee is correct or the classification made by the employer is correct. If the Authority is of the opinion that the classification alleged by the employee is correct, then obviously it has to decide the matter in accordance with law and direct the payment of wages, but if after hearing the parties or making an enquiry as contemplated under S. 20 (3) of the Act, that the classification put forth by the employer is correct then under such circumstances at that point of time the Authority would not proceed further and direct the employee to raise his claim before a properly constituted forum. 10. The object and reasons for enacting the Minimum Wages Act are to provide for fixation of wages in industries. The Act itself intends to achieve a lofty ideal of doing social justice to workmen and employees employed in various industries by prescribing and providing minimum rates of wages. The Act in fact has been enacted and passed for the welfare of the labourers. The lofty ideal behind the enactment of the Act can never be lost sight ofwhi1e interpreting the provisions of this Act. S. 20 of the Act, provides for the claims in relation to the minimum wages. Such a claim cannot be permitted to become futile only on the question of classification. The question of classification as said above, is basically based upon the terms of the contract of employment. If the terms of the contract clearly state about a particular classification or categorisation, then obviously the Authority under the Act will have to decide in accordance with the terms of the contract. 11.
The question of classification as said above, is basically based upon the terms of the contract of employment. If the terms of the contract clearly state about a particular classification or categorisation, then obviously the Authority under the Act will have to decide in accordance with the terms of the contract. 11. In the instant case though the question was raised before the Authority but it appears that it was not seriously pressed and even if it was really argued before the authority then it has been properly answered by the Authority. The petitioner firm admittedly is engaged in manufacturing engineering goods and the Notification No.4 (C)-20-R1-L1h. XIV-A dated 28th December, 1981 contains the definition of skilled, semi-skilled and unskilled employees. The same question arose before and was considered by the Karnataka High Court in matter of M/s Chitradurga Copper Company Ltd. Bangalore v. Regional Lahour Commissioner (Central) Bangalore (1984 Lab IC-NOC 10). The Karnataka High Court has held that the Authority under the Act has power to investigate and test whether a particular employee falls into category of skilled, non-skilled or semi-skilled for purposes of enforcing the Act. We are in respectful agreement with the view pronounced by the Karnataka High Court. Even otherwise it is clear that there is no dispute in relation to classification and the same is not borne out from the original application filed before the Authority. 12. The object and reasons for enacting the Minimum Wages Act, 1948 is for justification for its statutory fixation of minimum wages. The objects further say that such provisions which exist in more advanced countries are even more necessary in India, where workers' organisations are yet poorly developed and the workers' bargaining power is consequently poor. 13. From the order dated 13.1.83 passed by the Authority which is based on appreciation of the evidence it is clear that the employees were working for a long period either on a particular post or were engaged in a particular work. The Authority after considering the evidence came to the conclusion that the nature of the work would certainly decide their placing or classification. The Authority further held that respondents Hakimuddin, Ashokrao and Kadar Bhai can be treated as skilled labour, while Girish Kumar would fall within the category of semi-skilled labour.
The Authority after considering the evidence came to the conclusion that the nature of the work would certainly decide their placing or classification. The Authority further held that respondents Hakimuddin, Ashokrao and Kadar Bhai can be treated as skilled labour, while Girish Kumar would fall within the category of semi-skilled labour. Once this question was decided by the Authority then obviously after applying the notification dated 7.12.1978 the Authority was justified in ordering the payment of the wages. In our opinion the contention raised by the counsel for the appellant that the Authority constituted under S. 20 cannot decide the question of classification of workmen, as it has no jurisdiction to do so, has to be rejected. As observed by us and even by the authorities on which reliance has been placed by the appellants the questions which are incidental or which relates to the jurisdiction of the Authority have certainly to be decided by the Authority itself first. If the Authority comes to the conclusion that a particular employee falls within a particular class then, it only has to implement the provisions of law or the notifications issued. An employer cannot be permitted to raise the question that in view of his allegation that employee belongs to a particular class the authority would have no jurisdiction to proceed further with the matter. 14. The appeal is liable to and is accordingly dismissed. However, there shall be no order as to costs. R.D. Shukla, J. -- 15.
An employer cannot be permitted to raise the question that in view of his allegation that employee belongs to a particular class the authority would have no jurisdiction to proceed further with the matter. 14. The appeal is liable to and is accordingly dismissed. However, there shall be no order as to costs. R.D. Shukla, J. -- 15. Section 20 (3) of the Minimum Wages Act, 1948 reads as follows :- "(3) When any application under sub-section (2) is entertained, the Authority shall hear the applicant and the employer, or give them an opportunity of being heard, and after such further inquiry, if any, as it may consider necessary, may, without prejudice to any other penalty to which the employer may be liable under this Act, direct— (i) in the case of a claim arising out of payment of less then the minimum rates of wages, the payment to the employee of the amount by which the minimum wages payable to him exceed the amount actually paid, together with the payment of such compensation as the authority may think fit, not exceeding ten times the amount of such excess, (ii) in any other case, the payment of the amount due to the employee, together with the payment of such compensation as the Authority may think fit, not exceeding ten rupees, and the authority may direct payment of such compensation in cases where the excess or the amount due is paid by the employer to the employee before the disposal of the application. -x- -x Part (ii) of sub-section (3) of section 20 above the word occurs 'the payment of the amount due to the employee'. The meaning of word 'Due' has been given in the Law Lexicon 1st Edition - 4th Reprint Edition 1992 Page 367 as below :- "Due. As a noun, an existing obligation; an indebtedness; a simple indebtedness without reference to the time of payment; a debt ascertained and fixed though payable in future; As an adjective, capable of being justify demanded; claimed as of right; owing and unpaid, remaining unpaid; payable; regular; formal; according to rule or form. (4 MHC 385) 'Due' in an instalment bond means payable." 16.
(4 MHC 385) 'Due' in an instalment bond means payable." 16. The meaning of 'Due' as an adjective is capable of being justly demanded or claimed as of right, whenever, a question of demand for payment of wages is made, the Authority shall be within its power to decide what is just. While deciding the amount capable of being justly demanded the matter incidentally thereto, can always be looked into. Thus, the simple meaning in such cases that can be given is that whenever an employee files an application U/s. 20 of the Minimum Wages Act, 1948 the matter incidentally thereto can be decided by the Authority under the Act. 17. However, if a simple question of classification is raised, that of course would not be within the jurisdiction of the competent authority under the Minimum Wages Act. 18. With the observations I agree with the view of my brother and hold that the appeal is liable to be dismissed. As such the appeal is dismissed with no order as to costs.